Diana Shipping - 20-F annual report 2022

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C.

20549

FORM

20-F

(Mark One)

☐

REGISTRATION STATEMENT

PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934

OR

☑

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended

December 31, 2022

OR

☐

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

OR

☐

SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Date of event requiring this shell company report:

Not applicable

For the transition period from ___________________________

to ___________________________

Commission file number

001-32458

DIANA SHIPPING INC.

____________________________________________________________________________________________________________________________________________________________________________________________________________

(

Exact name of Registrant as specified in its charter)

Diana Shipping Inc.

____________________________________________________________________________________________________________________________________________________________________________________________________________

(Translation of Registrant’s

name into English)

Republic of the Marshall Islands

____________________________________________________________________________________________________________________________________________________________________________________________________________

(Jurisdiction of incorporation or organization)

Pendelis 16

,

175 64 Palaio Faliro

,

Athens

,

Greece

____________________________________________________________________________________________________________________________________________________________________________________________________________

(Address of principal executive offices)

Mr. Ioannis Zafirakis

Pendelis 16, 175 64 Palaio Faliro,

Athens, Greece

Tel:

+ 30-

210

-

9470-100

, Fax: +

30-210-9470-101

E-mail:

izafirakis@dianashippinginc.com

____________________________________________________________________________________________________________________________________________________________________________________________________________

(Name, Telephone, E-mail and/or

Facsimile number and Address of Company Contact Person)

Securities registered or to be

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, $0.01 par value including the Preferred Stock Purchase Rights

DSX

New York Stock Exchange

8.875% Series B Cumulative Redeemable Perpetual Preferred Shares, $0.01 par value

DSXPRB

New York Stock Exchange

Securities registered or to be registered pursuant

to Section 12(g) of the Act.

None

____________________________________________________________________________________________________________________________________________________________________________________________________________

(Title of Class)

Securities for which there is a reporting obligation pursuant to Section

15(d) of the Act.

None

____________________________________________________________________________________________________________________________________________________________________________________________________________

(Title of Class)

Indicate the number of outstanding shares of each of the issuer’s classes of capital or common stock

as of the close of the period covered by

the annual report.

As of December 31, 2022, there were

102,653,619

shares of the registrant’s

common stock outstanding

Indicate by check mark if the registrant is a well-known seasoned issuer,

as defined in Rule 405 of the Securities Act.

☐

Yes

☑

No

If this report is an annual or transition report, indicate by check mark if the registrant

is not required to file reports pursuant to Section 13

or 15(d) of the Securities Exchange Act of 1934.

☐

Yes

☑

No

Note – Checking the box above will not relieve any registrant

required to file reports pursuant to Section 13 or

15(d) of the Securities

Exchange Act of 1934 from their obligations under those Sections.

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

☐

No

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

☐

No

Indicate by check mark whether the registrant is a large accelerated

filer, an accelerated filer,

a non-accelerated filer,

or an emerging

growth company.

See definition of “large accelerated filer”,

“accelerated filer” and "emerging growth company" in Rule 12b-2 of the

Exchange Act.

Large accelerated filer

☐

Accelerated filer

☑

Non-accelerated filer

☐

Emerging growth company

☐

If an emerging growth company that prepares its financial statements

in accordance with U.S. GAAP,

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. □

† The term “new or revised financial accounting standard” refers

to any update issued by the Financial Accounting Standards

Board to its Accounting Standards Codification after April 5, 2012.

Indicate by check mark whether the registrant has filed a report on and attestation

to its management’s assessment of the

effectiveness of its internal control

over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the

registered public accounting firm that prepared or issued its audit report.

☑

If securities are registered pursuant to Section 12(b) of the Act, indicate

by check mark whether the financial statements of the

registrant included in the filing reflect the correction of an error to

previously issued financial statements.

☐

Indicate by check mark whether any of those error corrections are restatements

that required a recovery analysis of incentive-

based compensation received by any of the registrant’s

executive officers during the relevant recovery

period pursuant to §240.10D-

1(b).

☐

Indicate by check mark which basis of accounting the registrant has used to

prepare the financial statements included in this

filing:

U.S. GAAP

☑

International Financial Reporting Standards as issued

Other

☐

by the International Accounting Standards Board □

If “Other” has been checked in response to the previous question, indicate by check mark which financial statement

item the registrant has

elected to follow.

☐

Item 17

☐

Item 18

If this is an annual report, indicate by check mark whether the registrant is a shell company

(as defined in Rule 12b-2 of the Exchange Act).

☐

Yes

☑

No

(APPLICABLE ONLY TO

ISSUERS INVOLVED IN BANKRUPTCY

PROCEEDINGS DURING THE PAST FIVE YEARS)

Indicate by check mark whether the registrant has filed all documents and reports required

to be filed by Sections 12, 13 or 15(d) of the

Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court.

☐

Yes

☐

No

4

TABLE OF CONTENTS

FORWARD-LOOKING STATEMENTS

5

PART I

Item 1.

Identity of Directors, Senior Management and Advisers

8

Item 2.

Offer Statistics and Expected Timetable

8

Item 3.

Key Information

8

Item 4.

Information on the Company

44

Item 4A.

Unresolved Staff Comments

68

Item 5.

Operating and Financial Review and Prospects

68

Item 6.

Directors, Senior Management and Employees

85

Item 7.

Major Shareholders and Related Party Transactions

92

Item 8.

Financial Information

97

Item 9.

The Offer and Listing

98

Item 10.

Additional Information

99

Item 11.

Quantitative and Qualitative Disclosures about Market Risk

108

Item 12.

Description of Securities Other than Equity Securities

109

PART II

Item 13.

Defaults, Dividend Arrearages and Delinquencies

110

Item 14.

Material Modifications to the Rights of Security Holders and Use of

Proceeds

110

Item 15.

Controls and Procedures

110

Item 16A.

Audit Committee Financial Expert

111

Item 16B.

Code of Ethics

111

Item 16C.

Principal Accountant Fees and Services

111

Item 16D.

Exemptions from the Listing Standards for Audit Committees

112

Item 16E.

Purchases of Equity Securities by the Issuer and Affiliated Purchasers

112

Item 16F.

Change in Registrant’s Certifying Accountant

113

Item 16G.

Corporate Governance

113

Item 16H.

Mine Safety Disclosure

114

PART III

Item 17.

Financial Statements

115

Item 18.

Financial Statements

115

Item 19.

Exhibits

115

5

FORWARD-LOOKING STATEMENTS

Matters

discussed

in

this

annual

report

and

the

documents

incorporated

by

reference

may

constitute

forward-looking

statements.

The

Private

Securities

Litigation

Reform

Act

of

1995

provides

safe

harbor

protections

for

forward-looking

statements

in

order

to

encourage

companies

to

provide

prospective

information about

their business.

Forward-looking statements

include, but

are not

limited to,

statements

concerning plans, objectives, goals,

strategies, future events

or performance, underlying

assumptions and

other statements, which are other than statements of historical facts.

Diana Shipping

Inc., or

the Company, desires

to take

advantage of

the safe

harbor provisions

of the

Private

Securities Litigation Reform Act of

1995 and is including this

cautionary statement in connection with this

safe harbor legislation.

This document and any other written or oral statements made by the Company

or

on its behalf may include forward-looking statements, which reflect its current views with respect to future

events and financial performance, and

are not intended to

give any assurance as to

future results. When

used in this document, the words “believe”,

“anticipate,” “intends,” “estimate,” “forecast,” “project,” “plan,”

“potential,”

“will,”

“may,”

“should,”

“expect,”

“targets,”

“likely,”

“would,”

“could,”

“seeks,”

“continue,”

“possible,”

“might,”

“pending,”

and

similar

expressions,

terms

or

phrases

may

identify

forward-looking

statements.

Please note in this annual report, “we”,

“us”, “our” and “the Company” all refer to

Diana Shipping Inc. and

its subsidiaries, unless otherwise indicated.

The forward-looking statements in

this document are based

upon various assumptions,

many of which are

based,

in

turn,

upon

further

assumptions,

including

without

limitation,

management’s

examination

of

historical

operating

trends,

data

contained

in

its

records

and

other

data

available

from

third

parties.

Although the

Company believes that

these assumptions

were reasonable when

made, because

these assumptions are inherently

subject to significant uncertainties and

contingencies which are difficult

or impossible to predict and are beyond its control, the Company

cannot assure you that it will achieve or

accomplish these expectations, beliefs or projections.

Such

statements

reflect

the

Company’s

current

views

with

respect

to

future

events

and

are

subject

to

certain risks,

uncertainties and

assumptions. Should

one or

more of

these risks

or uncertainties

materialize,

or should underlying assumptions prove

incorrect, actual results may vary

materially from those described

herein as anticipated, believed,

estimated, expected or

intended. The Company

is making investors

aware

that such forward-looking

statements, because

they relate to

future events, are

by their very

nature subject

to many important factors that could cause actual results

to differ materially from those contemplated.

In addition

to these important

factors and

matters discussed

elsewhere herein,

including under

the heading

"Item

3.

Key

Information—D.

Risk

Factors,"

and

in

the

documents

incorporated

by

reference

herein,

important factors that, in

its view, could cause actual results

to differ materially from those

discussed in the

forward-looking statements include, but are not limited to:

●

the strength of world economies;

●

fluctuations in

currencies and

interest rates,

and the

impact of

the discontinuance

of the

London

Interbank Offered

Rate for

US Dollars,

or LIBOR,

after June

30, 2023

on any

of our

debt referencing

LIBOR in the interest rate;

●

general market conditions, including fluctuations in charter hire rates and

vessel values;

●

changes in demand in the dry-bulk shipping industry;

6

●

changes

in

the

supply

of

vessels,

including

when

caused

by

new

newbuilding

vessel

orders

or

changes to or terminations of existing orders, and vessel scrapping

levels;

●

changes

in

the

Company's operating

expenses, including

bunker

prices, crew

costs,

drydocking

and insurance costs;

●

the Company’s future operating or financial results;

●

availability

of

financing

and

refinancing

and

changes

to

the

Company’s

financial

condition

and

liquidity, including the Company’s

ability to pay

amounts that

it owes and

obtain additional

financing

to fund capital expenditures,

acquisitions and other

general corporate activities

and the Company’s

ability to

obtain financing

and comply

with the

restrictions and

other covenants in

the Company’s

financing arrangements;

●

changes in governmental rules and regulations or actions taken by

regulatory authorities;

●

potential liability from pending or future litigation;

●

compliance with governmental, tax, environmental and safety regulation, any non-compliance with

the U.S.

Foreign Corrupt Practices

Act of

1977 (FCPA)

or other

applicable regulations relating

to

bribery;

●

the failure of counter parties to fully perform their contracts with

the Company;

●

the Company’s dependence on key personnel;

●

adequacy of insurance coverage;

●

the volatility of the price of the Company’s common shares;

●

the Company’s incorporation under the

laws of the Marshall

Islands and the different rights

to relief

that may be available compared to other countries, including the United

States;

●

general domestic and international political conditions or labor disruptions;

●

the impact of port or canal congestion or disruptions;

●

the length and severity of

the continuing novel coronavirus (COVID-19) outbreak and its

impact in

the dry-bulk shipping industry;

●

potential physical

disruption of

shipping routes

due to

accidents, climate-related

reasons (acute

and

chronic), political events, public health threats, international

hostilities and instability, piracy or acts

by terrorists; and

●

other

important factors

described from

time to

time

in the

reports filed

by the

Company with

the

Securities and

Exchange Commission,

or the

SEC, including

those factors

discussed in

“Item 3.

Key

Information-

D.

Risk

Factors” in

this

Annual Report

on

Form

20-F

and

the

New

York

Stock

Exchange, or the NYSE.

This report may

contain assumptions,

expectations, projections,

intentions and

beliefs about future

events.

These statements are intended as forward-looking statements.

The Company may also from time

to time

make forward-

looking statements

in other

documents and

reports that

are filed

with or

submitted to

the

Commission, in

other information sent

to the

Company’s security

holders, and in

other written

materials.

7

The Company

also cautions

that assumptions,

expectations, projections,

intentions and

beliefs about

future

events

may

and

often

do

vary

from

actual

results

and

the

differences

can

be

material.

The

Company

undertakes no

obligation to

publicly update

or revise

any forward-looking

statement contained

in this

report,

whether as a result of new information, future events or otherwise,

except as required by law.

8

PART I

Item 1.

Identity of Directors, Senior Management and Advisers

Not Applicable.

Item 2.

Offer Statistics and Expected Timetable

Not Applicable.

Item 3.

Key Information

A.

[Reserved]

B.

Capitalization and Indebtedness

Not Applicable.

C.

Reasons for the Offer and Use of Proceeds

Not Applicable.

D.

Risk Factors

Summary of Risk Factors

The below bullets summarize the principal risk factors related

to an investment in our Company.

Industry Specific Risk Factors

●

Charter hire rates

for dry bulk

vessels are

volatile and

have fluctuated

significantly in

the

past years, which may adversely affect

our earnings, revenues and profitability and our

ability to comply with our loan covenants.

●

The current

state of

the global

financial markets

and economic

conditions may

adversely

impact

our

ability

to

obtain

additional

financing

on

acceptable

terms

and

otherwise

negatively impact our business.

●

Our operating results may be affected by seasonal fluctuations.

●

An increase in the price of fuel, or bunkers, may adversely affect our

profits.

●

We

are

subject

to

complex laws

and

regulations, including

environmental regulations

that can adversely affect the cost, manner or feasibility of doing business.

●

Increased inspection

procedures, tighter

import

and export

controls and

new

security

regulations could increase costs and disrupt our business.

9

●

Operational risks and damage to our vessels could adversely

impact our performance.

●

If

our

vessels

call

on

ports

located

in

countries

or

territories

that

are

the

subject

of

sanctions

or

embargoes

imposed

by

the

U.S.

government,

the

European

Union,

the

United

Nations,

or

other

governmental

authorities,

it

could

lead

to

monetary

fines

or

penalties and may adversely affect our reputation and the market for

our securities.

●

We

conduct business

in China,

where the

legal system

is not

fully developed

and has

inherent uncertainties that could limit the legal protections available

to us.

●

Failure

to

comply

with

the

U.S.

Foreign

Corrupt

Practices

Act

could

result

in

fines,

criminal penalties and an adverse effect on our business.

●

Changing laws and

evolving reporting requirements

could have an

adverse effect on

our

business.

Company Specific Risk Factors

●

The market

values of

our vessels could

decline, which could

limit the

amount of

funds

that we can borrow and could trigger breaches of certain financial covenants contained

in

our

loan

facilities,

which

could

adversely

affect

our

operating

results,

and

we

may

incur a loss if we sell vessels following a decline in their market values.

●

We

charter

some

of

our

vessels

on

short-term

time

charters

in

a

volatile

shipping

industry and a decline

in charter hire rates

could affect our results

of operations and

our

ability to pay dividends.

●

Rising crew costs could adversely affect our results of operations.

●

Our investment in

Diana Wilhelmsen Management

Limited may expose us

to additional

risks.

●

A cyber-attack could materially disrupt our business.

●

Climate change

and greenhouse

gas restrictions

may adversely

impact our

operations

and markets.

●

Increasing scrutiny and

changing expectations

from investors,

lenders and other

market

participants

with

respect

to

our

ESG

policies

may

impose

additional

costs

on

us

or

expose us to additional risks.

●

Our earnings may be

adversely affected if we

are not able to

take advantage of favorable

charter rates.

●

Investment in derivative instruments such as forward

freight agreements could result in

losses.

●

We cannot

assure you that

we will be

able to borrow

amounts under loan

facilities and

restrictive covenants in our loan facilities impose financial and

other restrictions on us.

10

●

We

are

subject

to

certain

risks

with

respect

to

our

counterparties

on

contracts,

and

failure of such

counterparties to meet

their obligations could

cause us to

suffer losses

or otherwise adversely affect our business.

●

In the highly competitive

international shipping industry, we

may not be able

to compete

for charters with new entrants or established companies with greater resources, and as

a result, we may be unable to employ our vessels profitably.

●

We may be unable

to attract and

retain key management

personnel and other

employees

in

the

shipping

industry,

which

may

negatively

impact

the

effectiveness

of

our

management and results of operations.

●

Technological

innovation and

quality and

efficiency requirements

from our

customers

could reduce our charter hire income and the value of our vessels.

●

We

may

not

have

adequate

insurance

to

compensate

us

if

we

lose

our

vessels

or

to

compensate third parties.

●

Our vessels

may suffer

damage and we

may face

unexpected drydocking costs,

which

could adversely affect our cash flow and financial condition.

●

The aging of our fleet may result in increased operating costs in the future, which could

adversely affect our earnings.

●

We

are exposed

to U.S.

dollar and

foreign currency

fluctuations and

devaluations that

could harm our reported revenue and results of operations.

●

Volatility

of

London

Interbank

Offered

Rate

(“LIBOR”),

the

cessation

of

LIBOR

and

replacement

of

our

interest

rate

in

our

debt

agreements

could

affect

our

profitability,

earnings and cash flow.

●

We

depend upon

a few

significant customers

for

a large

part of

our revenues

and the

loss of

one or

more of

these customers

could adversely

affect our

financial performance.

●

We are a holding

company, and we depend

on the ability

of our subsidiaries

to distribute

funds to us in order to satisfy our financial obligations.

●

Because we

are organized under

the laws

of the

Marshall Islands, it

may be

difficult to

serve

us

with

legal

process

or

enforce

judgments

against

us,

our

directors

or

our

management.

●

If we expand our

business further, we

may need to improve our

operating and financial

systems and will need to recruit suitable employees and crew for our

vessels.

●

We may have to pay tax on U.S. source income, which would reduce

our earnings.

●

United States tax authorities could treat us as a “passive foreign investment company,”

which

could

have

adverse

United

States

federal

income

tax

consequences

to

United

States holders.

Risks Relating to Our Common Stock

11

●

We cannot assure

you that our board

of directors will continue

to declare dividends on

shares of our common stock in the future.

●

The market

prices and trading

volume of our

shares of

common stock may

experience

rapid

and

substantial

price

volatility,

which

could

cause

purchasers

of

our

common

stock to incur substantial losses.

●

Since we are

incorporated in the

Marshall Islands,

which does not

have a well-developed

body

of

corporate

law,

you

may

have

more

difficulty

protecting

your

interests

than

shareholders of a U.S. corporation.

●

As

a

Marshall

Islands

corporation

and

with

some

of

our

subsidiaries

being

Marshall

Islands

entities

and

also

having

subsidiaries

in

other

offshore

jurisdictions,

our

operations may

be subject

to economic

substance requirements,

which could

impact our

business.

●

Certain existing shareholders will be able to exert

considerable control over matters on

which our shareholders are entitled to vote.

●

Future sales of our

common stock could

cause the market

price of our common

stock to

decline.

●

Our

Series

B

Preferred

Shares

are

senior

obligations

of

ours

and

rank

prior

to

our

common shares with respect

to dividends, distributions

and payments upon

liquidation,

which could have an adverse effect on the value of our common shares.

Risks Relating to Our Series B Preferred Stock

●

We may

not have sufficient

cash from our

operations to enable

us to pay

dividends on

our Series B Preferred

Shares following the payment

of expenses and

the establishment

of any reserves.

●

Our Series B

Preferred Shares are subordinate

to our indebtedness, and

your interests

could

be

diluted

by

the

issuance

of

additional

preferred

shares,

including

additional

Series B Preferred Shares, and by other transactions.

●

We may redeem the Series

B Preferred Shares, and you may not

be able to reinvest the

redemption price you receive in a similar security.

Some

of

the

following

risks

relate

principally

to

the

industry

in

which

we

operate

and

our

business

in

general. Other

risks relate

principally to

the securities

market and ownership

of our securities,

including our

common stock and our Series

B Preferred Shares. The occurrence

of any of the

events described in this

section could

significantly and

negatively affect

our business,

financial condition,

operating results,

cash

available for

the payment

of dividends

on our

shares and

interest on

our loan

facilities and

Bond, or

the

trading price of our securities.

Industry Specific Risk Factors

Charter

hire

rates

for

dry

bulk

vessels

are

volatile

and

have

fluctuated

significantly

in

the

past

years, which

may adversely

affect our earnings,

revenues and

profitability and

our ability

to comply

with our loan covenants.

12

Substantially all of our revenues

are derived from a single

market, the dry bulk segment,

and therefore our

financial results

are subject

to

cyclicality of

the

dry bulk

shipping industry

and any

attendant volatility

in

charter hire

rates and profitability. The

degree of

charter hire

rate volatility

among different types

of dry

bulk

vessels has

varied widely,

and time

charter and spot

market rates

for dry

bulk vessel

have in

the recent

past declined below

the operating costs

of vessels. When

we charter our

vessels pursuant

to spot or

short-

term time

charters, we

are exposed

to changes

in spot

market and

short-term charter

rates for

dry bulk

carriers and such changes

may affect our earnings

and the value

of our dry

bulk carriers at any

given time.

We cannot

assure you

that we

will be

able to

successfully charter

our vessels

in the

future or

renew existing

charters at

rates sufficient

to allow

us to

meet our

obligations

or pay

any dividends

in the

future. Fluctuations

in charter rates

result from changes

in the supply

of and demand

for vessel capacity

and changes in

the

supply

of

and

demand

for

the

major

commodities

carried

by

water

internationally.

Because

the

factors

affecting the supply

of and demand

for vessels are

outside of

our control and

are unpredictable,

the nature,

timing, direction

and degree

of changes

in industry

conditions are

also unpredictable.

A significant

decrease

in charter rates would

adversely affect our

profitability, cash flows and may

cause vessel values

to decline,

and,

as a

result, we

may have

to record

an impairment

charge in

our consolidated

financial statements

which could adversely affect our financial results.

Dry bulk market conditions

remained volatile in

2022, reflecting the

impact of a

broad economic slowdown,

easing of

port congestion,

and the

war in

Ukraine. With

the

exception of

a temporary

sharp increase

in

rates in

the immediate

aftermath of

Russia’s invasion

of Ukraine,

rates generally

trended downwards

during

the

course

of

the

year.

In

January

and

February

2023,

we

saw

spot

rates

fall

to

extremely

low

levels,

following normal seasonal patterns as well as

Chinese New Year,

which has reduced industrial activity in

the

region. Market

conditions

have

improved since

the

lows

of

February and

are

expected to

gradually

improve over the course of 2023 as China’s re-opening takes hold, however we cannot guarantee a trend

towards recovery.

Factors that influence demand for dry bulk vessel capacity include:

●

supply

of

and

demand

for

energy

resources,

commodities,

and

semi-finished

and

finished

consumer and industrial products;

●

changes in the exploration or production of

energy resources, commodities, and semi-finished

and finished consumer and industrial products;

●

the location of regional and global exploration, production and manufacturing

facilities;

●

the location

of consuming

regions for

energy resources,

commodities, and

semi-finished and

finished consumer and industrial products;

●

the globalization of production and manufacturing;

●

global and

regional economic

and political

conditions, armed

conflicts, including

the

ongoing

conflict between Russia and Ukraine and fluctuations in industrial

and agricultural production;

●

disruptions and developments in international trade;

●

changes

in

seaborne

and

other

transportation

patterns,

including

the

distance

cargo

is

transported by sea;

●

international sanctions, embargoes,

import and export

restrictions, nationalizations, piracy, and

terrorist attacks;

13

●

legal and regulatory changes including regulations

adopted by supranational authorities and/or

industry bodies, such as safety and environmental regulations and

requirements;

●

weather and acts of God and natural disasters;

●

environmental and other regulatory developments;

●

currency exchange rates, specifically versus USD; and

●

the continuing impact of the COVID-19 pandemic on the global

economy.

Demand for

our dry

bulk oceangoing

vessels is

dependent upon

economic

growth in

the world’s

economies,

seasonal and regional changes in

demand and changes to the

capacity of the global dry

bulk fleet and the

sources and supply for dry bulk cargo transported by sea. Continued adverse economic, political

or social

conditions

or

other

developments

could

further

negatively

impact

charter

rates

and

therefore

have

a

material adverse effect on our business results, results of operations and

ability to pay dividends.

Factors that influence the supply of dry bulk vessel capacity include:

●

the number of newbuilding orders and deliveries, including

slippage in deliveries;

●

the number of shipyards and ability of shipyards to deliver vessels;

●

port or canal congestion;

●

potential disruption,

including supply chain

disruptions, of

shipping routes due

to accidents

or

political events;

●

the scrapping of older vessels;

●

speed of vessel operation;

●

vessel casualties;

●

technological advances in vessel design and capacity;

●

the

degree

of

scrapping

or

recycling

of

older

vessels,

depending,

among

other

things,

on

scrapping or recycling rates and international scrapping or recycling

regulations;

●

the price of steel and vessel equipment;

●

product imbalances (affecting level of trading activity) and developments

in international trade;

●

the number

of vessels

that are

out of

service, namely

those that

are laid-up,

drydocked, awaiting

repairs or otherwise not available for hire;

●

availability of financing for new vessels and shipping activity;

●

changes

in

international

regulations

that

may

effectively

cause

reductions

in

the

carrying

capacity of vessels or early obsolescence of tonnage; and

●

changes

in

environmental

and

other

regulations

that

may

limit

the

useful

lives

and

trading

patterns of vessels.

14

In

addition

to

the

prevailing

and

anticipated

freight

rates,

factors

that

affect

the

rate

of

newbuilding,

scrapping and laying-up include newbuilding prices, secondhand vessel values in relation to scrap prices,

costs of

bunkers and

other operating

costs, costs

associated with

classification society

surveys, normal

maintenance and insurance coverage costs,

the efficiency and

age profile of the

existing dry bulk fleet

in

the

market

and

government

and

industry

regulation

of

maritime

transportation

practices,

particularly

environmental

protection

laws

and regulations.

These factors

influencing the

supply

of

and

demand

for

shipping capacity are outside of our

control, and we may not be able

to correctly assess the nature, timing

and degree of changes in industry conditions.

We anticipate that the future demand for our dry bulk carriers will be dependent upon economic growth in

the world’s economies, including China and India, seasonal and regional changes in demand, changes in

the capacity of the global

dry bulk carrier fleet

and the sources and

supply of dry bulk

cargo transported by

sea. While there has been a general decrease in new dry bulk carrier ordering

since 2014, the capacity of

the global

dry bulk

carrier fleet

could increase

and economic

growth may

not resume

in areas

that have

experienced

a

recession

or

continue

in

other

areas.

Adverse

economic,

political,

social

or

other

developments could have a material adverse effect on our business and operating

results.

The current

state of

the global

financial markets

and economic

conditions may

adversely impact

our ability to obtain additional financing on acceptable terms and otherwise negatively impact our

business.

Global

financial

markets

can

be

volatile

and

contraction

in

available

credit

may

occur

as

economic

conditions change.

In recent

years, operating

businesses in

the global

economy have

faced

weakening

demand for

goods and

services, deteriorating

international liquidity

conditions, and

declining markets

which

lead

to

a

general

decline

in

the

willingness

of

banks

and

other

financial

institutions

to

extend

credit,

particularly in

the shipping industry. As

the shipping industry

is highly dependent

on the

availability of

credit

to finance and expand operations, it may be negatively affected by such

changes and volatility.

Also,

as

a

result

of

concerns

about

the

stability

of

financial

markets

generally,

and

the

solvency

of

counterparties specifically,

the

cost of

obtaining money

from the

credit markets

may

increase if

lenders

increase interest rates, enact tighter lending standards, refuse to refinance existing debt at all or on terms

similar

to

current

debt,

and

reduce,

or

cease

to

provide

funding

to

borrowers.

Due

to

these

factors,

additional financing may not be available to the extent required, on acceptable terms or at all. If additional

financing is

not available

when needed,

or is

available only

on unfavorable

terms, we

may be

unable to

expand or meet our obligations as they come due or we may be unable to

enhance our existing business,

complete

additional

vessel

acquisitions

or

otherwise

take

advantage

of

business

opportunities

as

they

arise.

Credit

markets

in

the

United

States

and

Europe

have

in

the

past

experienced

significant

contraction,

deleveraging

and

reduced

liquidity,

and

there

is

a

risk

that

the

U.S.

federal

government

and

state

governments

and

European

authorities

continue

to

implement

a

broad

variety

of

governmental

action

and/or

new

regulation

of

the

financial

markets.

Global

financial

markets

and

economic

conditions

have

been,

and

continue

to

be,

disrupted

and

volatile.

We

face

risks

attendant

to

changes

in

economic

environments, changes in

interest rates, and

instability in the

banking and securities

markets around the

world,

among

other

factors

which may

have

a material

adverse

effect

on

our

results

of

operations and

financial condition and may

cause the price of

our common shares to decline.

As of December 31, 2022,

we had total outstanding indebtedness of $530.1 million under our various credit facilities and bond and a

further $142.4 million of finance liabilities.

15

Global economic conditions may continue to negatively impact

the drybulk shipping industry.

Major market disruptions

and adverse changes

in market conditions

and regulatory climate

in China, the

United States, the European Union and

worldwide may adversely affect our business

or impair our ability

to borrow amounts under credit facilities or any future financial

arrangements.

Chinese dry bulk imports have accounted

for the majority of global dry bulk

transportation growth annually

over the

last decade.

Accordingly,

our financial

condition and results

of operations,

as well

as our

future

prospects,

would

likely

be

hindered

by

an

economic

downturn

in

any

of

these

countries

or

geographic

regions. In recent

years China and

India have been

among the world’s

fastest growing economies

in terms

of gross domestic product, and any

economic slowdown in the Asia Pacific region particularly

in China or

India

may

adversely

affect

demand

for

seaborne

transportation

of

our

products

and

our

results

of

operations. Moreover, any deterioration in the economy of

the United States or the European Union, may

further adversely affect economic growth in Asia.

Economic growth is

expected to slow, including

due to supply-chain

disruption, the

recent surge in

inflation

and related actions

by central

banks and geopolitical

conditions, with

a significant

risk of recession

in many

parts

of

the

worlds

in

the

near

term.

In

particular,

an

adverse

change

in

economic

conditions

affecting

China, Japan, India or Southeast Asia generally could have a negative

effect on the drybulk market.

The dry bulk carrier charter market has improved but

remains significantly below its high in 2008,

which may affect

our revenues, earnings and

profitability, and our

ability to comply with

our loan

covenants.

The abrupt and

dramatic downturn in the

dry bulk charter

market until the

beginning of 2021,

from which

we

derive

substantially

all

of

our

revenues,

severely

affected

the

dry

bulk

shipping

industry

and

our

business. The

Baltic Dry

Index, or

the BDI,

a daily

average of

charter rates

for key

dry bulk

routes published

by the Baltic Exchange Limited, has long been viewed as the main benchmark to monitor the movements

of the dry bulk vessel charter market and the performance of the entire dry bulk shipping market. The BDI

declined

94%

in

2008

from

a

peak

of

11,793

in

May

2008

to

a

low

of

663

in

December 2008

and

has

remained volatile since then,

reaching a record low of

290 in February 2016. In

2022, the BDI ranged from

a

high

of

3369

on May

23,

2022 to

a

low

of

965

on

August

31,

2022 to

drop

again to

a

low

of 530

on

February 16,

2023. The

BDI has

since recovered

from the

February 2023

levels and

closed at

1484 on

March 23, 2023. There

can be no assurance that

the dry bulk charter

market will not decline

further. The

decline

and

volatility

in

charter

rates

is

due

to

various

factors,

including

the

lack

of

trade

financing

for

purchases of commodities carried

by sea, which

has resulted in

a significant decline in

cargo shipments,

and

the

excess

supply

of

iron

ore

in

China,

which

has

resulted

in

falling

iron

ore

prices

and

increased

stockpiles in Chinese

ports. The decline

and volatility in

charter rates in

the dry bulk

market also affects

the

value

of

our

dry

bulk

vessels,

which

follows

the

trends

of

dry

bulk

charter

rates,

and

earnings

on

our

charters, and similarly, affects our

cash flows, liquidity

and compliance with

the covenants contained

in our

loan agreements.

Any

decline

in

the

dry

bulk

carrier

charter

market

may

have

additional

adverse

consequences

for

our

industry,

including

an

absence

of

financing

for

vessels,

no

active

secondhand

market

for

the

sale

of

vessels,

charterers

seeking

to

renegotiate

the

rates

for

existing

time

charters,

and

widespread

loan

covenant defaults in the dry bulk shipping

industry. Accordingly, the value of our common shares could be

substantially reduced or eliminated.

Worldwide inflationary

pressures could

negatively impact

our results

of operations

and cash

flows.

It

has

been

recently

observed

that

worldwide

economies

have

experienced inflationary

pressures,

with

price

increases

seen

across

many

sectors

globally.

For

example,

the

U.S.

consumer

price

index,

an

inflation gauge

that measures

costs across

dozens of

items, rose

6.5% in

December 2022

compared to

16

the prior year, driven in large part by increases in energy costs. It remains to be seen whether inflationary

pressures will continue, and

to what degree,

as central banks begin

to respond to

price increases. In the

event that

inflation becomes

a significant

factor in

the global

economy generally

and in

the shipping

industry

more

specifically,

inflationary

pressures

would

result

in

increased

operating,

voyage

and

administrative

costs. Furthermore, the

effects of

inflation on the

supply and demand

of the products

we transport could

alter demand

for our

services. Interventions

in the

economy by

central banks

in response

to inflationary

pressures

may

slow

down

economic

activity,

including

by

altering

consumer

purchasing

habits

and

reducing demand for the commodities and products we carry,

and cause a reduction in trade. As a result,

the volumes of goods we

deliver and/or charter rates

for our vessels may be

affected. Any of these factors

could have an adverse effect on our business, financial condition, cash flows and operating

results.

Regulations relating to

ballast water discharge

may adversely affect our

revenues and profitability.

The IMO has imposed

updated guidelines for

ballast water management

systems specifying

the maximum

amount of viable

organisms allowed

to be discharged

from a vessel’s

ballast water. Depending on

the date

of the

International Oil

Pollution Prevention

('IOPP') renewal

survey,

existing vessels

constructed before

September 8, 2017 must

comply with the

updated D-2 Discharge Performance

Standard ('D-2 standard')

on or after September 8, 2019. For most vessels, compliance

with the D-2 standard involves installing on-

board

systems

to

treat

ballast

water

and

eliminate

unwanted

organisms.

Ships

constructed

on

or

after

September 8, 2017 are to comply with the D-2 standard upon delivery.

We currently have one vessel that

does not comply with the updated guideline,

which is scheduled to undergo such works in 2023.

Furthermore, United States regulations are currently changing. Although the 2013 Vessel

General Permit

(“VGP”) program and U.S. National

Invasive Species Act (“NISA”)

are currently in effect to regulate

ballast

discharge, exchange and installation, the Vessel Incidental Discharge

Act (“VIDA”), which was signed

into

law

on

December

4,

2018,

requires

that

the

EPA

develop

national

standards

of

performance

for

approximately 30 discharges,

similar to those

found in the

VGP within

two years. On

October 26, 2020,

the

EPA

published a

Notice of

Proposed Rulemaking

for Vessel

Incidental Discharge

National Standards

of

Performance under

VIDA. Within two

years after

the EPA

publishes its final

Vessel

Incidental Discharge

National Standards

of Performance,

the U.S.

Coast Guard

must develop

corresponding implementation,

compliance, and

enforcement regulations regarding

ballast water.

The new regulations

could require the

installation of new equipment, which may cause us to incur substantial

costs.

Risks

associated

with

operating

ocean-going

vessels

could

affect

our

business

and

reputation,

which could have a material adverse effect on our results of operations and

financial condition.

The operation of ocean-going vessels carries inherent risks. These

risks include the possibility of:

●

marine disaster;

●

acts of God;

●

terrorism;

●

environmental accidents;

●

cargo and property losses or damage;

●

business

interruptions

caused

by

mechanical

failures,

human

error,

war,

political

action

in

various countries, labor strikes or adverse weather conditions; and

●

piracy or robbery.

17

In

addition,

international

shipping

is

subject

to

various

security

and

customs

inspection

and

in

countries of

origin

and

destination and

trans-shipment points.

Inspection

procedures can

result in the

seizure of the

cargo and/or our

vessels, delays in

the loading, offloading

or delivery and

the

levying

of

customs

duties,

fines

or

other

penalties

against

us.

It

is

possible

that

changes

to

inspection

procedures

could

impose

additional

financial

and

legal

obligations

on

us.

Furthermore,

changes

to

inspection procedures

could also

impose additional

costs and

obligations on

our customers

and may,

in

certain

cases,

render

the

shipment

of

certain

types

of

cargo

uneconomical

or

impractical.

Any

such

changes or developments may

have a material adverse

effect on our business, results

of operations, cash

flows, financial condition and available cash.

Our

operations outside

the

United States

expose us

to

global risks,

such as

political instability,

terrorist

or

other

attacks,

war,

international

hostilities

and

global

public

health

concerns,

which

may affect the seaborne transportation industry and adversely affect our business.

We are an international

shipping company and

primarily conduct most

of our operations

outside the United

States, and our business,

results of operations, cash

flows, financial condition

and ability to pay dividends,

if any, in the future may be adversely affected by changing economic, political and government conditions

in

the

countries and

regions where

our

vessels are

employed or

registered. Moreover,

we

operate in

a

sector of the economy that is likely to be adversely impacted by the effects of political

conflicts.

Currently, the world economy faces a number of challenges, including trade tensions between the

United States and China,

stabilizing growth in China, continuing threat

of terrorist attacks around

the world,

continuing instability and

conflicts and other

ongoing occurrences in

the Middle

East,

Ukraine,

and

in

other

geographic

areas

and

countries,

as

well

as

the

public

health

concerns

stemming from the ongoing COVID-19 outbreak.

In the

past, political

instability has

also resulted

in attacks

on vessels,

mining of

waterways and

other efforts

to disrupt international shipping, particularly in the Arabian Gulf region and most recently in the Black Sea

in connection with the

recent conflicts between

Russia and Ukraine. Acts

of terrorism and piracy

have also

affected

vessels trading

in

regions

such

as the

South

China Sea

and

the

Gulf

of

Aden

off

the

coast

of

Somalia. Any

of these

occurrences could

have a

material adverse

impact

on our

future performance,

results

of operation, cash flows and financial position.

Beginning

in

February

of

2022,

President

Biden

and

several

European

leaders

announced

various

economic sanctions against Russia in connection with the aforementioned conflicts in the Ukraine region,

which may adversely impact our business.

The United

States Department

of the

Treasury’s

Office

of Foreign

Assets Control

(“OFAC”)

administers

and

enforces

multiple

authorities

under

which

sanctions

have

been

imposed

on

Russia,

including:

the

Russian

Harmful

Foreign

Activities

sanctions

program,

established

by

the

Russia-related

national

emergency declared in

Executive Order (E.O.)

14024 and subsequently

expanded and addressed

through

certain

additional

authorities,

and

the

Ukraine-Russia-related

sanctions

program,

established

with

the

Ukraine-related national emergency

declared in E.O.

13660 and subsequently

expanded and addressed

through

certain additional

authorities.

The

United

States

has

also

issued

several

Executive Orders

that

prohibit

certain

transactions

Russia,

including

the

importation

of

certain

energy

products

of

Russian Federation origin

(including crude oil,

petroleum, petroleum fuels,

oils, liquefied

natural gas and

coal), and all new investments in Russian by U.S. persons,

among other prohibitions and export controls.

Furthermore, the United

States has also

prohibited a variety

of specified services related

to the maritime

transport

of

Russian

Federation

origin

crude

oil

and

petroleum

products,

including

trading/commodities

brokering, financing,

shipping, insurance

(including reinsurance

and protection

and indemnity),

flagging,

and customs brokering. These prohibitions

took effect on

December 5, 2022 with respect

to the maritime

transport

of

crude

oil

and

February

5,

2023

with

respect

to

the

maritime

transport

of

other

petroleum

products.

An exception exists

to permit such

services when the

price of the

seaborne Russian oil

does not

18

exceed the

relevant price

cap; but

implementation of

this price

exception relies

on a

recordkeeping and

attestation process that

allows each

party in

the supply chain

of seaborne Russian

oil to

demonstrate or

confirm that oil has been purchased

at or below the price cap.

Violations of the price cap policy

or the risk

that information,

documentation, or

attestations provided

by parties

in the

supply chain

are later

determined

to be false may pose additional risks adversely affecting our business.

The ongoing conflict could result in

the imposition of further economic sanctions or new categories of export restrictions against persons in or

connected to Russia.

While in general

much uncertainty remains

regarding the global

impact of the conflict

in

Ukraine,

it

is

possible

that

such

tensions

could

adversely

affect

the

Company’s

business,

financial

condition, results

of operation

and cash

flows. For

instance, on

February 24,

2023 OFAC

issued a

new

determination

pursuant

to

Section

1(a)(i)

of

Executive

Order

14024,

which

enables

the

imposition

of

sanctions on individuals and entities who operate or have operated in the metals and mining sector of the

Russian

economy.

Increased

restrictions

on

the

metals

and

mining

sector

may

pose

additional

risks

adversely affecting our business.

Our

business

could

also

be

adversely

impacted

by

trade

tariffs,

trade

embargoes

or

other

economic

sanctions that limit trading activities

by the United States or

other countries against countries

in the Middle

East, Asia or elsewhere as a result of terrorist attacks, hostilities

or diplomatic or political pressures.

In addition,

public health threats,

such as

COVID-19, influenza and

other highly communicable

diseases

or viruses,

outbreaks of which

have from

time to

time occurred

in various

parts of

the world

in which we

operate,

including

China,

Japan

and

South

Korea,

which

may

even

become

pandemics,

such

as

the

COVID-19 virus, could lead to a significant

decrease of demand for the transportation

of dry bulk cargoes.

Such events may also

adversely impact our

operations, including timely

rotation of our crews,

the timing of

completion

of

any

outstanding

or

future

newbuilding

projects

or

repair

works

in

drydock

as

well

as

the

operations of our customers.

Delayed rotation of

crew may adversely

affect the mental and

physical health

of our crew and the safe operation of our vessels as a consequence.

Outbreaks of epidemic and pandemic diseases,

including COVID-19, and governmental responses

thereto could adversely affect our business.

Since the beginning

of 2020, the

COVID-19 pandemic

has negatively

affected economic conditions,

supply

chains,

labor

markets,

demand

for

certain

shipped

goods

both

regionally

and

globally,

and

has

also

negatively impacted and may continue to impact

our operations and the operations of

our customers and

suppliers. Over the course of the pandemic,

measures taken to mitigate the spread of

the COVID-19 virus

have included travel bans,

quarantines, social distancing, limitations on

public gatherings, impositions on

supply chain

logistics, lockdowns and

other emergency public

health measures,

resulting in

a significant

reduction in

overall global

economic activity

and extreme

volatility in

the global

financial markets.

Relatively

weak global economic conditions

during periods of volatility

have and may

continue to have a

number of

adverse consequences for the dry bulk shipping sectors.

While many of the measures taken were relaxed

starting

in

2021,

we

cannot

predict

whether

and

to

what

degree

emergency

public

health

and

other

measures will be reinstituted in

the event of any resurgence

in the COVID-19 virus or

any variants thereof.

This

year,

we

have

experienced

increases

in

crew

travel

and

medical

costs

due

to

COVID-19.

If

a

resurgence

of

COVID-19,

including

due

to

new

variants,

results

in

travel

restrictions,

supply

chain

disruptions, and

other impediments

to

the

orderly conduct

of

seaborne trade,

such

as those

caused by

China’s “zero-covid” policy, there

may be an

additional material

adverse effect on

our results of

operations,

cash

flows

and

financial

condition.

Further,

prolongment

of

the

COVID-19

pandemic

could

also

impact

credit markets

and financial

institutions and

result in

increased interest

rate spreads

and other

costs of,

and difficulty

in obtaining,

bank financing

and our

ability to

finance the

purchase price

of vessel

acquisitions,

which could limit our ability to grow our business in line with our

strategy.

Our operating results may be affected by seasonal fluctuations.

19

We operate our vessels in markets that have

historically exhibited seasonal variations in demand and, as

a result,

in charter

hire rates.

This seasonality

may result

in quarter-to-quarter

volatility in

our operating

results.

The

dry

bulk

carrier

market

is

typically

stronger

in

the

fall

and

winter

months

in

anticipation

of

increased

consumption

of

coal

and

other

raw

materials

in

the

northern

hemisphere

during

the

winter

months. In addition, unpredictable

weather patterns in these

months tend to disrupt vessel

scheduling and

supplies of certain

commodities. As

a result, our

revenues may

be weaker during

the fiscal quarters

ending

June 30

and

September 30,

and,

conversely,

our

revenues

may

be

stronger

in

fiscal

quarters

ending

December 31 and March 31.

While this seasonality

does not directly

affect our operating

results, it could

materially

affect

our

operating results

to

the

extent

our

vessels

are

employed

in

the

spot

market

in

the

future.

An increase in the price of fuel, or bunkers, may adversely affect our

profits.

While we generally will not bear the cost

of fuel or bunkers for vessels

operating on time charters, fuel is

a

significant

factor

in

negotiating

charter

rates.

As

a

result,

an

increase

in

the

price

of

fuel

beyond

our

expectations

may

adversely

affect

our

profitability

at

the

time

of

charter

negotiation.

Fuel

is

also

a

significant, if not

the largest, expense

in shipping when

vessels are under

voyage charter.

The price and

supply of

fuel is

unpredictable and

fluctuates based

on events

outside our

control, including

geopolitical

developments, supply

and demand

for

oil

and

gas,

actions by

the

Organization of

Petroleum Exporting

Countries (the

"OPEC"), and

other oil

and gas

producers, war

and unrest

in oil

producing countries

and

regions, regional production patterns

and environmental concerns. Any

future increase in the

cost of fuel

may reduce the profitability and competitiveness of our business.

We

are

subject

to

complex

laws

and

regulations,

including

environmental

regulations

that

can

adversely affect the cost, manner or feasibility of doing business.

Our business and the operations of our vessels

are materially affected by environmental regulation in the

form of international conventions, national, state

and local laws and regulations in force in

the jurisdictions

in which

our vessels

operate, as

well as

in the

country or

countries of

their registration,

including those

governing the

management and

disposal of

hazardous substances

and wastes,

the cleanup

of oil

spills

and other contamination, air emissions (including greenhouse gases), water discharges and ballast water

management. These regulations include, but

are not limited

to, European Union

regulations, the U.S.

Oil

Pollution

Act

of

1990,

requirements

of

the

U.S.

Coast

Guard,

or

USCG

and

the

U.S.

Environmental

Protection Agency, the U.S. Clean Air Act of 1970 (including

its amendments of 1977 and 1990)

, the U.S.

Clean Water

Act, and the U.S.

Maritime Transportation Security

Act of 2002, and

regulations of the IMO,

including the International Convention on Civil Liability for Oil Pollution Damage of

1969, the International

Convention

for

the

Prevention

of

Pollution

from

Ships

of

1973,

as

modified

by

the

Protocol

of

1978,

collectively referred to as MARPOL 73/78 or MARPOL, including designations of Emission Control Areas,

thereunder, SOLAS,

the International Convention on

Load Lines of 1966,

the International Convention of

Civil Liability for

Bunker Oil Pollution

Damage, and the

ISM Code. Because such

conventions, laws, and

regulations are often revised, we

cannot predict the ultimate cost

of complying with such requirements or

the impact

thereof on the

re-sale price

or useful life

of any

vessel that

we own

or will acquire.

Additional

conventions, laws

and regulations may

be adopted

that could

limit our

ability to

do business

or increase

the

cost

of

our

doing

business

and

which

may

materially

adversely

affect

our

operations.

Government

regulation

of

vessels,

particularly

in

the

areas

of

safety

and

environmental

requirements,

continue

to

change, requiring us

to incur significant

capital expenditures on our

vessels to keep

them in compliance,

or even

to scrap

or sell

certain vessels

altogether.

In addition,

we may

incur significant

costs in

meeting

new

maintenance

and

inspection

requirements,

in

developing

contingency

arrangements

for

potential

environmental violations and in obtaining insurance coverage.

In addition, we

are required by

various governmental and

quasi-governmental agencies to

obtain certain

permits,

licenses,

certificates,

approvals

and

financial

assurances

with

respect

to

our

operations.

Our

failure to

maintain necessary

permits, licenses,

certificates, approvals

or financial

assurances could

require

20

us to incur substantial costs or temporarily suspend operation of one or more of the vessels in our fleet or

lead to the invalidation or reduction of our insurance coverage.

Environmental

requirements

can

also

affect

the

resale

value

or

useful

lives

of

our

vessels,

require

a

reduction in

cargo capacity,

ship modifications

or operational

changes or

restrictions, lead

to decreased

availability

of

insurance

coverage

for

environmental

matters

or

result

in

the

denial

of

access

to

certain

jurisdictional waters or

ports, or detention

in certain ports.

Under local, national and

foreign laws, as

well

as

international

treaties

and

conventions,

we

could

incur

material

liabilities,

including

for

cleanup

obligations and natural resource damages, in

the event that there is

a release of petroleum or hazardous

substances from

our vessels

or otherwise

in connection

with our

operations. We

could also

become subject

to personal injury

or property damage claims

relating to the

release of hazardous substances

associated

with our

existing or

historic operations. Violations

of, or

liabilities under,

environmental requirements can

result in substantial

penalties, fines

and other

sanctions, including

in certain

instances, seizure

or detention

of our vessels.

Increased inspection procedures, tighter import and export controls and new security regulations

could increase costs and disrupt our business.

International

shipping

is

subject

to

various

security

and

customs

inspection

and

in

countries of origin,

destination and trans-shipment

points. Under the

U.S. Maritime Transportation Security

Act

of

2002 (“MTSA”),

the

U.S.

Coast Guard

issued regulations

requiring

the

implementation of

certain

security requirements

aboard vessels

operating in

waters subject

to the

jurisdiction of

the United

States

and

at

certain ports

and facilities.

These security

procedures may

result

in

cargo seizure,

delays in

the

loading, offloading,

trans-shipment or delivery

and the

levying of customs

duties, fines or

other penalties

against us. It is possible

that changes to inspection

procedures could impose additional

financial and legal

obligations on us.

Changes to inspection

procedures could also

impose additional

costs and obligations

on

our customers and

may,

in certain cases,

render the shipment of

certain types of

cargo uneconomical or

impractical.

Any

such

changes

or

developments

may

have

a

material

adverse

effect

on

our

business,

customer relations, financial

condition and earnings.

Operational risks and damage to our vessels could adversely

impact our performance.

The operation of an ocean-going vessel carries inherent

risks. Our vessels and their cargoes are

at risk of

being damaged or

lost because of

events such as

marine disasters, bad weather

and other acts

of God,

business

interruptions caused

by

mechanical failures,

grounding, fire,

explosions and

collisions, human

error, war, terrorism,

piracy, labor strikes,

boycotts and

other circumstances

or events.

Changing

economic,

regulatory

and

political conditions

in

some

countries, including

political and

military

conflicts, have

from

time

to

time

resulted

in

attacks

on

vessels,

mining

of

waterways,

piracy,

terrorism,

labor

strikes

and

boycotts. Damage to the

environment could also

result from our operations,

particularly through spillage

of

fuel,

lubricants

or

other

chemicals

and

substances

used

in

operations,

or

extensive

uncontrolled

fires.

These

hazards

may

result

in

death

or

injury

to

persons,

loss

of

revenues

or

property,

the

payment

of

ransoms,

environmental

damage,

higher

insurance

rates,

damage

to

our

customer

relationships

and

market disruptions, delay

or rerouting, any

of which may

subject us to

litigation. As a

result, we could

be

exposed

to

substantial

liabilities

not

recoverable

under

our

insurances.

Further,

the

involvement

of

our

vessels in a serious accident could harm our reputation as a safe and reliable vessel operator and lead to

a

loss

of

business. Epidemics

and

other

public health

incidents

may

also

lead

to

crew member

illness,

which

can

disrupt

the

operations

of

our

vessels,

or

to

public

health

measures,

which

may

prevent

our

vessels from calling

on ports or

discharging cargo in

the affected

areas or in

other locations after

having

visited the affected areas.

If our vessels suffer

damage, they may need

to be repaired at

a drydocking facility.

The costs of drydock

repairs are unpredictable

and may

be substantial.

We may have

to pay

drydocking costs

that our

insurance

does not

cover at

all or

in full.

The loss

of revenues

while these

vessels are

being repaired

and repositioned,

21

as well

as the

actual cost

of these

repairs, may

adversely affect

our business

and financial

condition. In

addition, space

at drydocking

facilities is

sometimes limited

and not

all drydocking

facilities are

conveniently

located. We may be

unable to find space at

a suitable drydocking facility or our vessels

may be forced to

travel to a drydocking facility that is not conveniently located relative to

our vessels' positions. The loss of

earnings while these

vessels are forced

to wait for

space or to

travel to more

distant drydocking facilities

may adversely affect our business and financial condition.

The operation

of dry

bulk vessels has

certain unique operational

risks. With

a dry

bulk vessel, the

cargo

itself and its

interaction with the

ship can be a

risk factor. By their nature,

dry bulk cargoes

are often heavy,

dense

and

easily

shifted,

and

react

badly

to

water

exposure.

In

addition,

dry

bulk

vessels

are

often

subjected to

battering treatment

during unloading

operations with

grabs, jackhammers

(to pry

encrusted

cargoes out of the

hold), and small bulldozers. This

treatment may cause damage to

the dry bulk vessel.

Dry bulk

vessels damaged

due to

treatment during

unloading procedures

may be

more susceptible

to a

breach at sea. Hull breaches in dry

bulk vessels may lead to the flooding of

their holds. If flooding occurs

in the forward holds, the bulk

cargo may become so waterlogged that

the vessel's bulkheads may buckle

under the resulting

pressure leading

to the loss of

the dry bulk vessel.

These risks may

also impact the

risk

of loss of life or harm to our crew.

If

we

are

unable to

adequately maintain

or

safeguard

our

vessels,

we may

be

unable to

prevent these

events. Any of these circumstances or events could negatively impact our business, financial condition or

results of operations. In addition, the loss of any

of our vessels could harm our crew and our

reputation as

a safe and reliable vessel owner and operator.

If our

vessels call

on ports

located in

countries or

territories that

are the

subject of

sanctions or

embargoes

imposed

by

the

U.S.

government,

the

European

Union,

the

United

Nations,

or

other

governmental authorities, it

could lead to

monetary fines or penalties

and may adversely affect

our

reputation and the market for our securities.

We have not engaged in

shipping activities in countries

or territories or with

government-controlled entities

in 2022

in violation

of any

applicable sanctions or

embargoes imposed by

the U.S.

government, the EU,

the

United

Nations

or

other

applicable governmental

authorities. Our

contracts with

our

charterers may

prohibit

them

from

causing

our

vessels

to

call

on

ports

located

in

sanctioned

countries

or

territories

or

carrying cargo for

entities that are

the subject of

sanctions. Although

our charterers may, in

certain causes,

control the

operation of

our vessels,

we have

monitoring processes

in place

reasonably designed

to ensure

our compliance with applicable economic sanctions and embargo laws. Nevertheless, it

remains possible

that our charterers may

cause our vessels to

trade in violation

of sanctions provisions without

our consent.

If

such

activities

result

in

a

violation

of

applicable

sanctions

or

embargo

laws,

we

could

be

subject

to

monetary fines,

penalties, or other

sanctions, and our

reputation and the

market for

our common shares

could be adversely affected.

The applicable sanctions

and embargo laws

and regulations of

these difference jurisdictions

vary in their

application and do not all apply to the same covered persons or proscribe the same activities. In addition,

the sanctions

and embargo

laws and

regulations of

each jurisdiction

may be

amended to

increase or

reduce

the restrictions they

impose over time,

and the

lists of

persons and entities

designated under these

laws

and regulations are amended

frequently. Moreover, most sanctions regimes provide that entities

owned or

controlled by the

persons or entities

designated in such

lists are

also subject to

sanctions. The U.S.

and

EU have

enacted new

sanctions programs

in recent

years. Additional

countries or

territories, as

well as

additional persons or

entities within or affiliated

with those countries

or territories, have, and

in the future

will,

become

the

target

of

sanctions.

These

require

us

to

be

diligent

in

ensuring

our

compliance

with

sanctions

laws.

Further,

the

U.S.

has

increased

its

focus

on

sanctions

enforcement with

respect to

the

shipping sector. Current or

future counterparties of ours may be affiliated with

persons or entities that are

or may be

in the future

the subject of

sanctions or embargoes imposed

by the United

States, EU, and/or

other international

bodies. If

we determine

that such

sanctions require

us to

terminate existing

or future

22

contracts to which we, or our subsidiaries, are party or if we are found to be in violation

of such applicable

sanctions, our results of operations may be adversely affected, or we may

suffer reputational harm.

As a result

of Russia’s actions

in Ukraine, the

U.S., EU and

United Kingdom,

together with numerous

other

countries and self-sanctioning,

have imposed significant

sanctions on persons

and entities associated

with

Russia

and

Belarus, as

well

as

comprehensive sanctions

on

certain

areas within

the

Donbas

region

of

Ukraine, and such sanctions apply to entities owned or controlled by such designated persons or entities.

These sanctions adversely affect our ability to

operate in the region and also restrict

parties whose cargo

we may carry.

Although we believe that we

have been in compliance with

all applicable sanctions and

embargo laws and

regulations in 2022 and

up to the date of

this annual report, and intend

to maintain such compliance,

there

can be no assurance that we

or our charterers will be

in compliance in the future, particularly

as the scope

of certain

laws may be

unclear and may

be subject to

changing interpretations. Any

such violation could

result

in

fines,

penalties or

other

sanctions that

could severely

impact

our

ability to

access

U.S.

capital

markets and conduct our business and could result in our

reputation and the markets for our securities to

be adversely affected

and/or in some

investors deciding, or being

required, to divest their

interest, or not

to invest, in us. In

addition, certain institutional investors may have investment policies

or restrictions that

prevent them

from holding

securities of

companies that

have contracts

with countries

or territories

identified

by the U.S. government as state sponsors of terrorism. The determination

by these investors not to invest

in, or

to divest

from, our shares

may adversely

affect the

price at

which our

shares trade. Moreover,

our

charterers may violate applicable sanctions

and embargo laws and

regulations as a result

of actions that

do

not

involve

us

or

our

vessels,

and

those

violations

could

in

turn

negatively

affect

our

reputation.

In

addition, our reputation

and the market

for our securities

may be adversely

affected if we engage

in certain

other

activities,

such

as

entering

into

charters

with

individuals

or

entities

that

are

not

controlled

by

the

governments of countries

or territories that

are the subject

of certain U.S.

sanctions or embargo

laws, or

engaging in operations

associated with

those countries or

territories pursuant

to contracts with

third parties

that

are

unrelated

to

those

countries

or

territories

or

entities

controlled

by

their

governments.

Investor

perception of the value of our common stock may

be adversely affected by the consequences of war,

the

effects of terrorism, civil unrest and governmental actions in countries or

territories that we operate in.

The smuggling

of drugs

or

other contraband

onto our

vessels may

lead to

governmental claims

against us.

We

expect that

our vessels

will call

in

ports in

areas where

smugglers attempt

to

hide drugs

and other

contraband on

vessels, with

or

without the

knowledge of

crew members.

To

the

extent our

vessels are

found with contraband, whether inside

or attached to the hull

of our vessel and whether with

or without the

knowledge of any of our crew, we may

face governmental or other regulatory claims which could have an

adverse effect on our business, results of operations, cash flows and financial

condition.

Maritime claimants

could arrest

or

attach one

or

more

of our

vessels, which

could interrupt

our

business or have a negative effect on our cash flows.

Crew members, suppliers of goods and services to a vessel, shippers of cargo, lenders, and other parties

may

be

entitled

to

a

maritime

lien

against

a

vessel

for

unsatisfied

debts,

claims

or

damages.

In

many

jurisdictions, a

maritime lien

holder may

enforce its

lien by

“arresting” or

“attaching” a

vessel through

judicial

or foreclosure proceedings.

The arrest or

attachment of

one or

more of our

vessels could interrupt

the cash

flow of

the charterer

and/or require

us to

pay a

significant amount

of money

to have

the arrest

or attachment

lifted, which would have an adverse effect on our cash flows.

In addition, in some jurisdictions, such

as South Africa, under the “sister-ship”

theory of liability, a claimant

may arrest

both the

vessel that

is subject

to the claimant’s

maritime lien

and any

“associated” vessel,

which

is any

vessel owned

or controlled

by the

same owner.

Claimants could

try to

assert “sister-ship”

liability

23

against

one

vessel

in

our

fleet

for

claims

relating

to

another

of

our

ships.

Under

some

of

our

present

charters, if the vessel is arrested or detained as a result of a claim against us, we may be in default of our

charter

and

the

charterer

may

suspend

the

payment

of

hire

under

the

charter

and

charge

us

with

any

additional expenses

incurred during

that period,

which may

negatively impact

our revenues

and cash

flows.

We

conduct

business

in

China,

where

the

legal

system

is

not

fully

developed

and

has

inherent

uncertainties that could limit the legal protections available

to us.

Some

of

our

vessels may

be

chartered to

Chinese

customers and

from

time

to

time

on

our

charterers'

instructions,

our

vessels

may

call

on

Chinese

ports.

Such

charters

and

voyages

may

be

subject

to

regulations in China

that may require

us to incur

new or additional

compliance or other

administrative costs

and

may require

that

we pay

to

the

Chinese government

new taxes

or other

fees.

Applicable laws

and

regulations in

China may

not be

well publicized

and may

not be

known to

us or

to our

charterers in

advance

of us

or our

charterers becoming

subject to

them, and

the implementation

of such

laws and

regulations

may be

inconsistent. Changes in

Chinese laws and

regulations, including with

regards to

tax matters, or

changes

in

their

implementation

by

local

authorities

could

affect

our

vessels

if

chartered

to

Chinese

customers as well

as our vessels

calling to Chinese

ports and could

have a material

adverse impact

on our

business, financial condition and results of operations.

Governments could

requisition our

vessels during

a period

of war

or emergency, resulting

in a

loss

of earnings.

A government could

requisition one or

more of

our vessels for

title or

for hire.

Requisition for title

occurs

when

a

government takes

control of

a vessel

and becomes

her

owner,

while requisition

for

hire occurs

when

a

government takes

control of

a

vessel and

effectively

becomes her

charterer at

dictated charter

rates. Generally, requisitions occur

during periods of war or emergency,

although governments may elect

to requisition vessels in other circumstances. Although we would be entitled to compensation in the event

of

a

requisition

of

one

or

more

of

our

vessels,

the

amount

and

timing

of

payment

would

be

uncertain.

Government requisition of one or

more of our vessels may negatively

impact our revenues and reduce

the

amount

of

cash

we

may

have

available

for

distribution

as

dividends

to

our

shareholders,

if

any

such

dividends are declared.

Failure

to

comply

with

the

U.S.

Foreign

Corrupt

Practices

Act

could

result

in

fines,

criminal

penalties and an adverse effect on our business.

We may

operate in a

number of countries

throughout the world,

including countries suspected

to have

a

risk of corruption. We are committed to doing business in accordance with applicable anti-corruption laws

and have adopted measures

designed to ensure compliance with

the U.S. Foreign Corrupt

Practices Act

of 1977, as

amended (the “FCPA”).

We are

subject, however,

to the risk

that we, our

affiliated entities or

our

or

their

respective

officers,

directors,

employees

and

agents

may

take

actions

determined to

be

in

violation of

such anti-corruption

laws, including

the FCPA.

Any such

violation could

result in

substantial

fines, sanctions, civil and/or criminal penalties, curtailment of operations in certain jurisdictions, and might

adversely affect our business,

earnings or financial

condition. In addition,

actual or alleged violations

could

damage

our

reputation

and

ability

to

do

business.

Furthermore,

detecting,

investigating,

and

resolving

actual

or

alleged

violations

is

expensive

and

can

consume

significant

time

and

attention

of

our

senior

management.

Changing laws and

evolving reporting requirements

could have an

adverse effect on

our business.

Changing laws,

regulations and

standards relating

to reporting

requirements, including

the European

Union

General Data Protection Regulation, or GDPR, may create additional

compliance requirements for us.

24

GDPR broadens the

scope of personal

privacy laws to

protect the rights

of European Union

citizens and

requires organizations to

report on

data breaches within

72 hours

and be bound

by more

stringent rules

for obtaining the consent of individuals

on how their data can be used.

GDPR has become enforceable

on

May 25, 2018

and non-compliance

may expose entities

to significant fines

or other regulatory

claims which

could have an adverse effect on our business, financial condition, and operations.

Company Specific Risk Factors

The market values of our vessels could decline,

which could limit the amount of funds

that we can

borrow and

could trigger

breaches of

certain financial

covenants contained

in our

loan facilities,

which

could

adversely

affect

our

operating

results,

and

we

may

incur

a

loss

if

we

sell

vessels

following a decline in their market values.

While the

market values

of vessels

and the

freight charter

market have

a very

close relationship

as the

charter market

moves from

trough to

peak, the

time lag

between the

effect of

charter rates

on market

values

of ships can vary.

The market

values of

our vessels

have generally

experienced high

volatility,

and you

should expect

the

market values of our vessels to fluctuate depending on a number of factors

including:

●

the prevailing level of charter hire rates;

●

general economic and market conditions affecting the shipping industry;

●

competition from other shipping companies and other modes

of transportation;

●

the types, sizes and ages of vessels;

●

the supply of and demand for vessels;

●

applicable governmental or other regulations;

●

technological advances;

●

the need

to upgrade

vessels as

a result

of charterer

requirements, technological

advances in

vessel

design or equipment or otherwise; and

●

the cost of newbuildings.

If the market values of

our vessels decline, we

may not be in compliance

with certain covenants contained

in our

loan facilities

and we

may not

be able

to refinance

our debt

or obtain

additional financing or

incur

debt on terms that are acceptable

to us or at all. As of December

31, 2022, we were in compliance

with all

of the covenants in our loan facilities. If

we are not able to comply with the

covenants in our loan facilities

or are unable

to obtain

waivers or

amendments or

otherwise remedy

the relevant

breach, our

lenders could

accelerate our debt and foreclose on our vessels.

Furthermore, if

we sell

any of

our owned

vessels at

a time

when prices

are depressed,

our business,

results

of operations, cash flow and financial condition

could be adversely affected. Moreover,

if we sell a vessel

at a time when vessel prices have fallen, the sale may be at less than the vessel's carrying amount in our

financial statements, resulting

in a

loss and

a reduction

in earnings.

In addition,

if vessel

values decline,

we may have to record an impairment adjustment in our financial statements which

could adversely affect

our financial results.

25

We charter

some of

our vessels

on short-term time

charters in

a volatile

shipping industry and

a

decline in charter hire rates could affect our results of operations and our ability

to pay dividends.

Although significant exposure to

short-term time charters is

not unusual in the

dry bulk shipping industry,

the short-term

time charter

market is

highly competitive

and spot

market charter

hire rates

(which affect

time charter

rates) may

fluctuate significantly

based upon

available charters

and the

supply of,

and demand

for,

seaborne

shipping

capacity.

While

the

short-term

time

charter

market

may

enable

us

to

benefit

in

periods

of

increasing charter

hire

rates,

we

must

consistently

renew

our

charters

and

this

dependence

makes us

vulnerable to

declining charter

rates. As

a result

of the

volatility in

the dry

bulk carrier

charter

market, we may

not be able

to employ our

vessels upon the

termination of their

existing charters at their

current charter

hire rates

or at

all. The

dry bulk

carrier charter

market is

volatile, and

in the

recent past,

short-term

time

charter

and

spot

market

charter

rates

for

some

dry

bulk

carriers

declined

below

the

operating

costs

of

those

vessels

before

rising.

We

cannot

assure

you

that

future

charter

hire

rates

will

enable us to operate our vessels profitably, or to pay dividends.

Rising crew costs could adversely affect our results of operations.

Due to an increase in the size of the global shipping fleet, the limited supply of

and increased demand for

crew

has

created

upward

pressure

on

crew

costs.

Additionally,

the

return

of

a

number

of

Ukrainian

seafarers to

their homes as

a result

of the

ongoing war in

Ukraine has

reduced the number

of seafarers

globally,

and

thereby

increased

the

pressure

on

crew

wages.

Continued

higher

crew

costs

or

further

increases in crew costs could adversely affect our results of operations.

Our investment in Diana Wilhelmsen Management Limited

may expose us to additional risks.

During

2015

we

invested

in

a

50/50

joint

venture

with

Wilhelmsen

Ship

Management

which

provides

management

services

to

a

limited

number

of

vessels

in

our

fleet

and

to

affiliated

companies,

but

our

eventual goal

is to

provide fleet

management services

to unaffiliated

third party

vessel operators.

While

this joint

venture may

provide us

in the

future with

a potential

revenue source,

it may

also expose

us to

risks such

as low

customer satisfaction, increased

operating costs compared

to those we

would achieve

for our

vessels, and

inability to

adequately staff

our vessels

with crew

that meets

our expectations

or to

maintain our vessels according to our standards, which would adversely

affect our financial condition.

A cyber-attack could materially disrupt our business.

We

rely

on

information

technology

systems

and

networks

in

our

operations

and

administration

of

our

business.

Information

systems

are

vulnerable

to

security

breaches

by

computer

hackers

and

cyber

terrorists. We

rely on

industry accepted

security measures

and technology

to securely

maintain confidential

and

proprietary

information

maintained

on

our

information

systems.

However,

these

measures

and

technology may not adequately prevent security breaches. Our

business operations could be targeted by

individuals or groups seeking to sabotage or disrupt our information technology systems and networks, or

to steal data. A successful cyber-attack could materially disrupt our operations, including the safety of our

operations, or lead to unauthorized release of

information or alteration of information in our

systems. Any

such attack or other

breach of our information

technology systems could

have a material

adverse effect on

our

business

and

results

of

operations.

In

addition,

the

unavailability

of

the

information

systems

or

the

failure

of

these

systems to

perform

as

anticipated for

any reason

could

disrupt

our

business

and could

result

in

decreased

performance

and

increased

operating

costs,

causing

our

business

and

results

of

operations

to

suffer.

Any

significant

interruption

or

failure

of

our

information

systems

or

any

significant

breach of

security could

adversely affect

our business

and results

of operations.

Our systems

were the

subject of a malicious attack

in September 2020 that resulted in

disruptions to our computer networks for

a period of several days. We were able

to successfully fully restore our systems

without interruption to our

business

or

operations.

Since

then, we

have

taken

extensive

measures

to

enhance

our

security

infrastructure, reform network

architecture, and implement

rigorous security policies

in line with

ISO27001.

26

Key

initiatives

include

establishing

security

testing,

business

continuity,

disaster

recovery,

and

incident

response programs, as

well as

implementing multi-factor

authentication and a

vulnerability management

framework. Despite these improvements we cannot assure you that we will be able to successfully thwart

all future attacks with causing material and adverse effect on our business.

Moreover,

cyber-attacks against

the Ukrainian

government and

other countries

in the

region have

been

reported in

connection with

the recent

conflict between

Russia and

Ukraine. To

the extent

such attacks

have

collateral

effects

on

global

critical

infrastructure

or

financial

institutions,

such

developments could

adversely affect our business, operating results and financial condition. At this time, it is difficult to assess

the likelihood of such threat and any potential impact at this

time.

Even

without

actual

breaches

of

information

security,

protection

against

increasingly

sophisticated

and

prevalent cyberattacks

may result

in significant

future prevention,

detection, response

and management

costs, or

other costs,

including the

deployment of

additional cybersecurity

technologies, engaging

third-

party

experts,

deploying

additional

personnel

and

training

employees.

Further,

as

cyberthreats

are

continually evolving,

our

controls and

procedures may

become inadequate,

and we

may be

required to

devote additional resources to modify or enhance our systems in the future. Such expenses could have a

material adverse effect on our future performance, results of operations,

cash flows and financial position.

Climate

change

and

greenhouse

gas

restrictions

may

adversely

impact

our

operations

and

markets.

Due to concern over the risk

of climate change, a number of

countries and the IMO have adopted, or

are

considering the

adoption of,

regulatory frameworks

to reduce

greenhouse gas

emissions. These

regulatory

measures

may

include,

among

others,

adoption

of

cap

and

trade

regimes,

carbon

taxes,

increased

efficiency standards and incentives

or mandates for renewable

energy.

More specifically,

on October 27,

2016,

the

International

Maritime

Organization’s

Marine

Environment

Protection

Committee

(“MEPC”)

announced

its

decision

concerning

the

implementation

of

regulations

mandating

a

reduction

in

sulfur

emissions from 3.5% currently to 0.5% as of the beginning of January 1, 2020. Additionally,

in April 2018,

nations at the MEPC

72 adopted an

initial strategy to reduce

greenhouse gas emissions from

ships. The

initial

strategy

identifies

―levels

of

ambition

to

reducing

greenhouse

gas

emissions,

including

(1)

decreasing the carbon intensity from

ships through implementation of further phases

of the EEDI for

new

ships;

(2)

reducing

carbon

dioxide

emissions

per

transport

work,

as

an

average

across

international

shipping, by

at

least 40%

by 2030,

pursuing efforts

towards 70%

by 2050,

compared to

2008 emission

levels; and (3)

reducing the total

annual greenhouse

emissions by at

least 50% by

2050 compared to

2008

while pursuing efforts towards phasing them out entirely.

Since January

1, 2020,

ships have

to either

remove sulfur

from emissions

or buy

fuel with

low sulfur

content,

which may lead to

increased costs and supplementary investments for

ship owners. The interpretation of

"fuel

oil used

on board"

includes use

in main

engine, auxiliary

engines and

boilers. We

have elected

to

comply with this regulation

by using 0.5% sulfur fuels

on board, which are

available around the world but

often at a higher cost

and may result in higher

costs than other companies

that elected to install scrubbers

on their vessels.

In

addition,

although

the

emissions

of

greenhouse

gases

from

international

shipping

currently

are

not

subject

to

the

Kyoto

Protocol

to

the

United

Nations

Framework

Convention

on

Climate

Change,

which

required adopting countries

to implement national programs

to reduce emissions

of certain gases,

or the

Paris

Agreement

(discussed

further

below),

a

new

treaty

may

be

adopted

in

the

future

that

includes

restrictions on shipping emissions. Compliance with

changes in laws, regulations and

obligations relating

to climate

change could increase

our costs related

to operating

and maintaining our

vessels and require

us

to

install

new

emission

controls,

acquire

allowances

or

pay

taxes

our

greenhouse

gas

emissions

or

administer

and

manage

a

greenhouse

gas

emissions

program.

Revenue

generation

and

strategic growth opportunities may also be adversely affected.

27

Increasing

scrutiny

and

changing

expectations

from

investors,

lenders

and

other

market

participants with respect

to our ESG

policies may impose

additional costs on

us or

expose us to

additional risks.

Companies

across

all

industries

are

facing

increasing

scrutiny

relating

to

their

ESG

policies.

Investor

advocacy groups,

certain institutional

investors, investment

funds, lenders

and other

market participants

are increasingly focused on ESG practices and in recent years have placed increasing importance on the

implications and

social cost

of their

investments. The

increased focus

and activism

related to

ESG and

similar matters may hinder access to

capital, as investors and lenders may decide

to reallocate capital or

to not commit capital as a result of their assessment of a company’s ESG practices. Companies which do

not

adapt

to

or

comply

with

investor,

lender

or

other

industry

shareholder

expectations

and

standards,

which are evolving, or

which are perceived

to have not responded

appropriately to the

growing concern for

ESG

issues,

regardless

of

whether

there

is

a

legal

requirement

to

do

so,

may

suffer

from

reputational

damage and

the business,

financial condition,

and/or stock

price of

such a

company could

be materially

and adversely affected.

In

February 2021,

the

Acting Chair

of the

SEC issued

a statement

directing the

Division of

Corporation

Finance to enhance

its focus on

climate-related disclosure in

public company filings

and in March

2021 the

SEC announced the creation of a Climate and ESG Task

Force in the Division of Enforcement (the “Task

Force”).

The

Task

Force’s

goal

is

to

develop

initiatives

to

proactively

identify

ESG-related

misconduct

consistent

with

increased

investor

reliance

on

climate

and

ESG-related

disclosure

and

investment.

To

implement

the

Task

Force’s

purpose,

the

SEC

has

taken

several

enforcement

actions,

with

the

first

enforcement action taking

place in May

2022, and promulgated

new rules. On

March 21, 2022,

the SEC

proposed that all

public companies are

to include extensive

climate-related information in

their SEC filings.

On May 25, 2022, SEC proposed

a second set of rules aiming

to curb the practice of "greenwashing"

(i.e.,

making unfounded

claims about

one's ESG

efforts)

and would

add proposed

amendments to

rules and

reporting

forms

that

apply

to

registered

investment

companies

and

advisers,

advisers

exempt

from

registration, and

business development companies.

As of

the date

of this

annual report,

these proposed

rules have not yet taken effect.

We

may

face

increasing

pressures

from

investors,

lenders

and

other

market

participants,

who

are

increasingly

focused

on

climate

change,

to

prioritize

sustainable

energy

practices,

reduce

our

carbon

footprint and

promote sustainability.

As a

result, we

may

be required

to

implement more

stringent ESG

procedures or

standards so that

our existing and

future investors

and lenders remain

invested in us

and

make further investments

in us. For

example, in February

2021, we established

a Sustainability

Committee

and in March 2021, we signed an agreement with American Bureau of Shipping (“ABS”) to implement the

ABS

Environmental

MonitorTM

digital

sustainability

solution

across

all

our

vessels

managed

by

Diana

Shipping Services S.A. Additionally, in May 2021, we signed a sustainability - linked loan facility with ABN

AMRO Bank N.V., through six wholly-owned subsidiaries. Under this loan, the margin amount that we are

required

to

pay

can

be

either

increased

or

decreased

depending

on

our

ability

to

achieve

certain

sustainability performance targets related to our fleet’s carbon emissions.

If we do not meet the standards

in this loan, our business could be harmed.

Additionally,

certain

investors

and

lenders

may

exclude

companies,

such

as

us,

from

their

investing

portfolios

altogether

due

to environmental,

social and

governance

factors.

These

limitations

in

both

the

debt and

equity capital

markets may

affect our

ability to

grow as

our plans

for growth

may include

accessing

the

equity

and

debt

capital

markets.

If

those

markets

are

unavailable,

or

if

we

are

unable

to

access

alternative means of

financing on acceptable

terms, or at all,

we may be unable

to implement our

business

strategy,

which would have

a material

adverse effect

on our

financial condition and

results of

operations

and impair our ability to service

our indebtedness. Further, it is likely that we

will incur additional costs and

require

additional

resources

to

monitor,

report

and

comply

with

wide

ranging

ESG

requirements.

The

28

occurrence

of

any

of

the

foregoing

could

have

a

material

adverse

effect

on

our

business

and

financial

condition.

Moreover,

from time to

time, in

alignment with

our sustainability priorities,

we may

establish and publicly

announce

goals

and

commitments

in

respect

of

certain

ESG

items.

While

we

may

create

and

publish

voluntary disclosures regarding ESG matters from time to time,

many of the statements in those voluntary

disclosures are

based on

hypothetical expectations

and assumptions

that may

or may

not be

representative

of current or actual risks or events or forecasts of expected risks or events, including the costs associated

therewith.

Such

expectations and

assumptions

are

necessarily uncertain

and

may

be

prone to

error

or

subject to

misinterpretation given

the long

timelines involved

and the

lack of

an established

single approach

to identifying, measuring and reporting on many ESG matters. If we fail to achieve

or improperly report on

our progress toward achieving our environmental goals and commitments, the resulting negative publicity

could adversely affect our reputation and/or our access to capital.

The Public Company Accounting Oversight Board inspection of our independent accounting firm,

could lead to findings

in our auditors’ reports

and challenge the accuracy

of our published audited

consolidated financial statements.

Auditors of

U.S. public

companies are

required by

law to

undergo periodic

Public Company

Accounting

Oversight

Board,

or

PCAOB,

inspections

that

assess

their

compliance

with

U.S.

law

and

professional

standards in connection with performance of audits of financial statements filed with the SEC. For several

years

certain

European

Union

countries,

including

Greece,

did

not

permit

the

PCAOB

to

conduct

inspections of accounting firms established and operating in such European Union countries, even if

they

were part of

major international firms.

Accordingly, unlike for most U.S.

public companies, the

PCAOB was

prevented

from

evaluating

our

auditor’s

performance

of

audits

and

its

quality

control

procedures,

and,

unlike stockholders of

most U.S. public

companies, we and

our stockholders were

deprived of the

possible

benefits of such inspections. Since 2015, Greece

has agreed to allow the PCAOB

to conduct inspections

of accounting firms operating in Greece. In the

future, such PCAOB inspections could result in findings in

our

auditors’

quality

control

procedures,

question

the

validity

of

the

auditor’s

reports

on

our

published

consolidated financial statements and

the effectiveness of our internal

control over financial reporting,

and

cast doubt upon the accuracy of our published audited financial

statements.

Our earnings

may be

adversely affected

if we

are not

able to

take advantage of

favorable charter

rates.

We

charter

our

dry

bulk

carriers

to

customers

pursuant

to

short,

medium

or

long-term

time

charters.

However, as part of our business strategy,

the majority of our vessels are currently fixed on medium-term

time charters. We

may extend the

charter periods

for additional vessels

in our

fleet, including additional

dry

bulk carriers that

we may purchase in

the future, to

take advantage of the

relatively stable cash flow

and

high

utilization

rates

that

are

associated

with

long-term

time

charters.

While

we

believe

that

long-term

charters provide us with relatively

stable cash flows and higher

utilization rates than shorter-term charters,

our vessels that

are committed to

long-term charters may not

be available for

employment on short-term

charters

during

periods

of

increasing

short-term

charter

hire

rates

when

these

charters

may

be

more

profitable than long-term charters.

Investment in derivative instruments such as forward

freight agreements could result in losses.

Forward

freight

agreements, or

FFAs

and

other derivative

instruments may

be

used

to

hedge

a vessel

owner's

exposure

to

the

charter

market

by

providing

for

the

sale

of

a

contracted

charter

rate

along

a

specified route and period of time. Upon settlement, if the contracted charter rate is less than the average

of the rates, as

reported by an identified index, for

the specified route and period,

the seller of the

FFA is

required to

pay the

buyer an

amount equal

to the

difference between

the contracted

rate and

the settlement

rate, multiplied by the number of days in the specified period. Conversely,

if the contracted rate is greater

29

than the settlement rate, the buyer is required to pay the seller the settlement sum. If we

take positions in

FFAs

or

other

derivative

instruments

and

do

not

correctly

anticipate

charter

rate

movements

over

the

specified route and time period, we could suffer losses in

the settling or termination of the FFA. This could

adversely affect our results of operations and cash flows.

We may have difficulty effectively managing our growth, which may adversely affect our earnings.

Since the completion of our initial public offering in

March 2005, we have increased our fleet to 51

vessels

in operation in 2017, and as of the date of this annual report we have 41 vessels in operation,

owned and

chartered-in. We may grow our

fleet further in the future

and this may require us

to increase the number

of

our personnel. We may also have to increase

our customer base to provide

continued employment for the

new vessels.

Any future growth will primarily depend on our ability to:

●

locate and acquire suitable vessels;

●

identify and consummate acquisitions or joint ventures;

●

enhance our customer base;

●

manage our expansion; and

●

obtain required financing on acceptable terms.

Growing

any

business

by

acquisition

presents

numerous

risks,

such

as

undisclosed

liabilities

and

obligations, the

possibility that

indemnification agreements

will be

unenforceable or

insufficient to

cover

potential

losses

and

difficulties

associated

with

imposing

common

standards,

controls,

procedures

and

policies, obtaining

additional qualified

personnel, managing

relationships with

customers and

integrating

newly acquired assets and

operations into existing infrastructure. We

cannot give any assurance that

we

will be

successful in

executing any future

growth plans or

that we

will not incur

significant expenses and

losses in connection with our future growth.

We cannot assure

you that we will

be able to borrow

amounts under loan facilities

and restrictive

covenants in our loan facilities impose financial and other restrictions

on us.

Historically, we have entered into several loan agreements

to finance vessel acquisitions,

the construction

of newbuildings and working capital.

As of December 31,

2022, we had $530.1 million

outstanding under

our

facilities

and

bond. Our

ability

to

borrow

amounts

under

our

facilities

is

subject

to

the

execution

of

customary

documentation

relating

to

the

facility,

including

security

documents,

satisfaction

of

certain

customary conditions

precedent and

compliance with

terms and

conditions included

in the

loan documents.

Prior

to

each

drawdown,

we

are

required,

among

other

things,

to

provide

the

lender

with

acceptable

valuations of the

vessels in our

fleet confirming that

the vessels in our

fleet have a minimum

value and that

the

vessels

in

our

fleet

that

secure

our

obligations under

the

facilities

are

sufficient

to

satisfy

minimum

security requirements.

To the extent that

we are

not able

to satisfy

these requirements,

including as

a result

of a decline

in the

value of

our vessels,

we may

not be

able to

draw down

the full

amount under

the facilities

without obtaining

a waiver

or consent

from the

lender.

We will

also not

be permitted

to borrow

amounts

under the facilities if we experience a change of control.

The loan facilities

also impose operating

and financial restrictions

on us. These

restrictions may limit

our

ability to, among other things:

30

●

pay dividends

if there

is a

default under

the loan

facilities or

if the payment

of the

dividend would

result in a default or breach of a loan covenants;

●

incur additional indebtedness, including through the issuance of guarantees;

●

change the flag, class or management of our vessels;

●

create liens on our assets;

●

sell our vessels;

●

enter into a

time charter

or consecutive

voyage charters

that have a

term that

exceeds, or

which

by virtue of any optional extensions may exceed a certain period;

●

merge or consolidate with, or transfer all or substantially all

our assets to, another person; and

●

enter into a new line of business.

Therefore, we

may need

to seek

permission from

our lenders

in order

to engage

in some

corporate actions.

Our lenders’ interests

may be different

from ours and

we cannot guarantee that

we will be

able to obtain

our

lenders'

permission when

needed.

This

may

limit

our

ability to

finance

our

future

operations, make

acquisitions or pursue business opportunities.

We

cannot

assure

you

that

we

will

be

able

to

refinance

indebtedness

incurred

under

our

loan

facilities and bond.

We cannot assure

you that we

will be able

to refinance our

indebtedness with

equity offerings or

otherwise,

on

terms that

are

acceptable to

us or

at

all. If

we

are

not able

to

refinance these

amounts with

the

net

proceeds of

equity offerings

or otherwise,

on terms

acceptable to us

or at

all, we

will have

to dedicate

a

greater portion of our cash flow from operations to pay the principal and interest of

this indebtedness than

if we were able to refinance such amounts. If we are not able to satisfy these obligations, we may have to

undertake alternative financing plans. The

actual or perceived credit quality

of our charterers, any defaults

by them, and

the market value of

our fleet, among other

things, may materially affect

our ability to obtain

alternative financing.

In addition,

debt service

payments under

our loan

facilities or

alternative financing

may limit funds otherwise available for working capital, capital expenditures and other purposes. If we are

unable to

meet our

debt obligations,

or if

we otherwise

default under

our loan

facilities or

an alternative

financing arrangement, our lenders could declare the

debt, together with accrued interest

and fees, to be

immediately due

and payable

and foreclose

on our

fleet, which

could result

in the

acceleration of

other

indebtedness that we

may have at

such time and

the commencement of

similar foreclosure proceedings

by other lenders.

Purchasing

and

operating

secondhand

vessels

may

result

in

increased

operating

costs

and

reduced operating days, which may adversely affect our earnings.

As part of our

current business

strategy to increase

our owned fleet,

we may acquire

new and secondhand

vessels. While we rigorously

inspect previously owned

or secondhand vessels prior

to purchase, this does

not

provide us

with the

same

knowledge about

their

condition and

cost of

any required

(or

anticipated)

repairs

that

we

would

have

had

if

these

vessels

had

been

built

for

and

operated

exclusively

by

us.

Accordingly, we may

not discover defects or other problems with secondhand vessels prior to purchasing

or

chartering-in,

or

may

incur

costs

to

terminate

a

purchase

agreement.

Any

such

hidden

defects

or

problems may require

us to put

a vessel into

drydock, which would

reduce our fleet

utilization and increase

our

operating

costs.

If

a

hidden

defect

or

problem

is

not

detected,

it

may

result

in

accidents

or

other

incidents for which we may become liable to third parties.

31

In general, the costs to maintain a vessel in

good operating condition increase with the age of the vessel.

Older vessels are typically less fuel-efficient than more recently constructed vessels due to improvements

in engine technology.

Cargo insurance rates increase with the age of a

vessel, making older vessels less

desirable to charterers.

Furthermore, governmental regulations, safety or other equipment

standards related to the age of vessels

may

require

expenditures for

alterations, or

the addition

of

new equipment

and may

restrict the

type

of

activities

in which

the

vessel may

engage. As

our

vessels age,

market conditions

may

not justify

those

expenditures or enable us to operate our vessels profitably during

the remainder of their useful lives.

We are subject to certain risks with respect to our counterparties

on contracts, and failure of such

counterparties

to

meet

their

obligations could

cause

us

to

suffer

losses

or

otherwise adversely

affect our business.

We

enter

into,

among

other

things,

charter

parties with

our

customers. Such

agreements

subject

us

to

counterparty risks. The

ability and willingness

of each of

our counterparties to

perform its obligations

under

a contract with us will depend on

a number of factors that are beyond

our control and may include, among

other things, general

economic conditions,

the condition of

the maritime and

offshore industries, the

overall

financial

condition

of

the

counterparty,

charter

rates

received

for

specific

types

of

vessels,

and

various

expenses. Should a counterparty fail to

honor its obligations under agreements with

us, we could sustain

significant losses, which could have a material adverse effect

on our business, financial condition, results

of operations and cash flows.

In addition, in

depressed market conditions, our

charterers may no

longer need a

vessel that is

currently

under charter

or may

be able

to obtain

a comparable

vessel at

lower rates.

As a

result, charterers

may

seek to

renegotiate the

terms of

their existing

charter agreements

or avoid

their obligations

under those

contracts.

If

our

charterers

fail

to

meet

their

obligations

to

us

or

attempt

to

renegotiate

our

charter

agreements,

it

may

be

difficult

to

secure substitute

employment for

such vessels,

and

any

new

charter

arrangements we

secure may

be

at

lower rates.

As

a result,

we

could

sustain significant

losses, which

could have

a material

adverse effect

on our

business, financial condition,

results of

operations and cash

flows.

In

the

highly

competitive

international

shipping

industry,

we

may

not

be

able

to

compete

for

charters with

new entrants

or established

companies with

greater resources,

and as

a result,

we

may be unable to employ our vessels profitably.

The

operation

of

dry

bulk

vessels

and

transportation

of

dry

bulk

cargoes

is

extremely

competitive

and

fragmented. Competition

for the transportation

of dry bulk

cargoes by sea

is intense and

depends on

price,

location,

size,

age,

condition

and

the

acceptability

of

the

vessel

and

its

operators

to

the

charterers.

Competition arises

primarily from

other vessel

owners, some

of whom

have substantially

greater resources

than we do. Due in part

to the highly fragmented market,

competitors with greater resources

than us could

enter the

dry bulk

shipping industry

and operate

larger fleets

through consolidations

or acquisitions

and

may

be able

to

offer

lower

charter rates

and

higher quality

vessels than

we

are

able to

offer.

If we

are

unable to successfully compete with other

dry bulk shipping companies, our results

of operations may be

adversely impacted.

We

may

be

unable to

attract

and

retain

key management

personnel and

other

employees in

the

shipping industry, which may

negatively impact the effectiveness of our

management and results

of operations.

Our success

depends to

a significant

extent upon

the abilities

and efforts

of our

management team.

We

have

entered

into

employment

contracts

with

our

Chief

Executive

Officer

Mrs. Semiramis

Paliou;

our

32

President, Mr.

Anastasios Margaronis;

our Chief

Financial Officer,

Chief Strategy

Officer,

Treasurer

and

Secretary Mr. Ioannis Zafirakis

and our Chief

Operating Officer Mr. Eleftherios

Papatrifon. On

February 22,

2023, Mr.

Eleftherios Papatrifon

resigned from

his position

of the

Chief Operating

Officer and

since that

date serves as a member of the board of

directors. Our success will depend upon our ability to retain key

members of

our management

team and

to hire

new members

as may

be necessary.

The loss

of any

of

these individuals could adversely

affect our business prospects

and financial condition. Difficulty

in hiring

and retaining replacement personnel could have

a similar effect. We do not currently, nor do we intend to,

maintain “key man” life insurance on any of our officers or other members of

our management team.

Technological

innovation

and

quality

and

efficiency

requirements

from

our

customers

could

reduce our charter hire income and the value of our vessels.

Our customers have a high and increasing focus on quality and compliance standards with their suppliers

across

the

entire

supply

chain,

including

the

shipping

and

transportation

segment.

Our

continued

compliance with these

standards and quality

requirements is vital

for our operations.

The charter hire

rates

and the value and operational life

of a vessel are determined by a number

of factors including the vessel’s

efficiency, operational flexibility and physical

life. Efficiency includes

speed, fuel economy

and the ability

to

load

and

discharge

cargo quickly.

Flexibility includes

the

ability to

enter harbors,

utilize related

docking

facilities and pass through canals and straits. The length of a vessel’s physical life is

related to its original

design and construction, its maintenance and the impact of the stress

of operations. We face competition

from

companies

with

more

modern

vessels

having

more

fuel

efficient

designs

than

our

vessels, or

eco

vessels, and if

new dry bulk

vessels are built

that are

more efficient or

more flexible or

have longer

physical

lives than the current eco vessels, competition from the current eco vessels and any more technologically

advanced vessels could adversely

affect the amount

of charter hire payments

we receive for our

vessels

and

the

resale

value

of

our

vessels

could

significantly

decrease.

Similarly,

technologically

advanced

vessels are

needed to

comply with

environmental laws the

investment in

which along

with the

foregoing

could have a material adverse effect on

our results of operations, charter hire payments and resale value

of vessels. This could

have an adverse effect

on our results of

operations, cash flows, financial condition

and ability to pay dividends.

We may

not have adequate

insurance to

compensate us if

we lose

our vessels or

to compensate

third parties.

We procure

insurance for

our fleet

against risks

commonly insured

against by

vessel owners

and operators.

Our

current

insurance

includes

hull

and

machinery

insurance,

war

risks

insurance

and

protection

and

indemnity

insurance

(which

includes

environmental

damage

and

pollution

insurance).

We

can

give

no

assurance that we are

adequately insured against all risks

or that our insurers

will pay a particular

claim.

Even if

our insurance

coverage is

adequate to

cover our

losses, we

may not

be able

to timely

obtain a

replacement vessel

in the

event of

a loss.

Furthermore, in

the future,

we may

not be

able to

obtain adequate

insurance

coverage at

reasonable rates

for

our fleet.

We

may

also

be

subject to

calls,

or

premiums, in

amounts based not only

on our own

claim records but

also the claim records

of all other members

of the

protection

and

indemnity

associations

through

which

we

receive

indemnity

insurance

coverage

for

tort

liability.

Our

insurance

policies

also

contain

deductibles,

limitations

and

exclusions

which,

although

we

believe are standard in the shipping industry, may nevertheless increase our costs.

Our

vessels

may

suffer

damage

and

we

may

face

unexpected

drydocking

costs,

which

could

adversely affect our cash flow and financial condition.

If our vessels suffer

damage, they may need

to be repaired at

a drydocking facility.

The costs of drydock

repairs are unpredictable

and can be substantial.

The loss of earnings

while a vessel is

being repaired and

repositioned, as well as the actual

cost of these repairs not covered

by our insurance, would decrease

our

earnings and available cash. We

may not have insurance that

is sufficient to cover

all or any of the

costs

or losses for damages

to our vessels and

may have to pay

drydocking costs not

covered by our insurance.

33

The aging of our fleet may result in increased operating costs in the future, which could adversely

affect our earnings.

In general,

the cost

of maintaining

a vessel

in good

operating condition

increases with

the age

of the

vessel.

As of the date of this annual report,

our fleet consists of 41 vessels in operation, owned and chartered-in,

having a combined carrying capacity of 4.7 million dead weight tons, or dwt, and a

weighted average age

of 9.9 years. As our fleet ages, we will incur

increased costs. Older vessels are typically less fuel efficient

and

more

costly

to

maintain

than

more

recently

constructed

vessels

due

to

improvements

in

engine

technology. Cargo

insurance rates increase with the age of a

vessel, making older vessels less desirable

to

charterers.

Governmental regulations

and

safety

or

other

equipment standards

the

age

of

vessels may also require expenditures for alterations or the addition of new equipment to our vessels and

may restrict

the type

of activities

in which

our vessels

may engage.

We cannot

assure you

that, as

our

vessels age, market

conditions will

justify those expenditures

or enable us

to operate our

vessels profitably

during the remainder of their useful lives.

We are exposed to U.S. dollar and foreign currency fluctuations and devaluations that could harm

our reported revenue and results of operations.

We generate

all of

our revenues

in U.S.

dollars but incur

around half of

our operating

expenses and our

general and administrative expenses in currencies other than the U.S. dollar, primarily the Euro. Because

a significant portion of

our expenses is incurred

in currencies other

than the U.S. dollar, our expenses

may

from time to

time increase relative

to our revenues

as a result

of fluctuations in

exchange rates, particularly

between the U.S. dollar and the Euro,

which could affect the amount of net

income that we report in future

periods. While

we historically

have not

mitigated the

risk associated

with exchange

rate fluctuations

through

the use of financial derivatives, we

may employ such instruments

from time to time in the future

in order to

minimize this risk. Our use of

financial derivatives would involve

certain risks, including the risk

that losses

on a

hedged position

could exceed

the nominal

amount invested

in the

instrument and

the risk

that the

counterparty to the derivative transaction

may be unable or

unwilling to satisfy its

contractual obligations,

which could have an adverse effect on our results.

Volatility of London Interbank Offered Rate (“LIBOR”), the cessation of LIBOR and replacement of

our interest rate in our debt agreements could affect our profitability, earnings and cash flow.

As certain

of

our current

financing agreements

have, and

our future

financing arrangements

may have,

floating interest

rates, typically based

on LIBOR,

movements in

interest rates

could negatively affect

our

financial performance. The publication of

U.S. Dollar LIBOR for

the one-week and two-month

U.S. Dollar

LIBOR

tenors

ceased

on

December

31,

2021,

and

the

ICE

Benchmark

Administration

(“IBA”),

the

administrator of LIBOR, with the support of

the United States Federal Reserve and the

United Kingdom’s

Financial Conduct Authority, announced the publication

of all other U.S.

Dollar LIBOR tenors will

cease on

June

30,

2023.

The

United

States

Federal

Reserve

concurrently

issued

a

statement

advising

banks

to

cease issuing U.S. Dollar LIBOR

instruments after 2021. As such,

any new loan agreements we

enter into

will not

use LIBOR

as an

interest rate,

and we

will need

to transition

our existing

loan agreements

from

U.S. Dollar LIBOR to an alternative reference rate prior to June 2023.

In

order

to

manage

our

exposure

to

interest

rate

fluctuations

under

LIBOR,

the

Secured

Overnight

Financing Rate, or “SOFR”, or any other alternative rate,

we have and may from time to time

use interest

rate derivatives to effectively fix some

of our floating rate debt obligations. No assurance can however

be

given that the use of

these derivative instruments, if any,

may effectively protect us from

adverse interest

rate

movements.

The

use

of

interest

rate

derivatives

may

affect

our

results

through

mark

to

market

valuation of these derivatives. Also,

adverse movements in interest

rate derivatives may require

us to post

cash as collateral,

which may impact

our free cash

position. Interest rate

derivatives may also

be impacted

by the transition from LIBOR to SOFR or other alternative rates.

34

Our financing agreements contain a provision requiring or permitting us to enter into negotiations with our

lenders to

agree to

an alternative

interest rate

or an

alternative basis

for determining

the interest

rate in

anticipation of

the cessation

of LIBOR.

These clauses

present significant

uncertainties as

to how

alternative

reference

rates

or

alternative

bases

for

determination

of

rates

would

be

agreed

upon,

as

well

as

the

potential for disputes

or litigation with

our lenders regarding

the appropriateness or

comparability to

LIBOR

of any substitute indices, such as SOFR, and any

credit adjustment spread between the two benchmarks.

In the

absence of

an agreement between

us and our

lenders, most of

our financing

agreements provide

that LIBOR would

be replaced with

some variation of

the lenders’ cost-of-funds rate.

The discontinuation

of LIBOR presents a number

of risks to our business, including

volatility in applicable interest

rates among

our

financing

agreements,

potential

increased

borrowing

costs

for

future

financing

agreements

or

unavailability

of

or

difficulty

in

attaining

financing,

which

could

in

turn

have

an

adverse

effect

on

our

profitability, earnings and cash flow.

We depend

upon a few

significant customers for a

large part of

our revenues and the

loss of one

or more of these customers could adversely affect our financial performance.

We have historically

derived a significant part

of our revenues from

a small number of

charterers. During

2022, 2021, and

2020, approximately

34%, 10%

and 34%, respectively, of

our revenues

were derived

from

two,

one

and

two

charterers,

respectively.

If

one

or

more

of

our

charterers

chooses

not

to

charter

our

vessels

or

is

unable

to

perform

under

one

or

more

charters

with

us

and

we

are

not

able

to

find

a

replacement charter, we could suffer

a loss of revenues that could adversely affect our financial condition

and results of operations.

We are a holding company, and we

depend on the ability of our subsidiaries to distribute funds to

us in order to satisfy our financial obligations.

We are a holding company and our subsidiaries conduct all of our operations and own all of our

operating

assets. We

have no significant

assets other than

the equity

interests in our

subsidiaries. As a

result, our

ability to satisfy our financial obligations depends on our subsidiaries and their ability to distribute

funds to

us.

If

we

are

unable

to

obtain

funds

from

our

subsidiaries,

we

may

not

be

able

to

satisfy

our

financial

obligations.

Because we

are organized

under the

laws of

the Marshall

Islands, it

may be

difficult to

serve us

with legal process or enforce judgments against us, our directors

or our management.

We are

organized under

the laws

of the

Marshall Islands,

and substantially

all of

our assets

are located

outside of the United States. In addition, the majority of our directors and officers are non-residents of the

United States, and all or a substantial portion of the assets of these non-residents are located outside the

United States.

As a

result, it

may be

difficult or

impossible for

someone to

bring an

action against

us or

against these

individuals in

the

United

States if

they

believe that

their

rights

have been

infringed under

securities laws or

otherwise. Even if

you are successful

in bringing an

action of this

kind, the laws

of the

Marshall Islands and of other jurisdictions may prevent or restrict them from enforcing a judgment against

our assets or the assets of our directors or officers.

The international nature of our operations may make the

outcome of any bankruptcy proceedings

difficult to predict.

We are incorporated under the laws of the Republic of the

Marshall Islands and we conduct operations in

countries

around

the

world.

Consequently,

in

the

event

of

any

bankruptcy,

insolvency,

liquidation,

dissolution, reorganization or

similar proceeding involving

us or

any of

our subsidiaries,

bankruptcy laws

other

than

those

of

the

United

States

could

apply.

If

we

become

a

debtor

under

U.S.

bankruptcy

law,

bankruptcy

courts

in

the

United

States

may

seek

to

assert

jurisdiction

over

all

of

our

assets,

wherever

35

located, including

property situated

in other countries.

There can

be no assurance,

however, that we would

become

a

debtor

in

the

United

States,

or

that

a

U.S.

bankruptcy

court

would

be

entitled

to,

or

accept,

jurisdiction over such a

bankruptcy case, or

that courts in other

countries that have

jurisdiction over us

and

our operations would recognize a

U.S. bankruptcy court’s jurisdiction

if any other bankruptcy

court would

determine it had jurisdiction.

If we

expand our

business further,

we may

need to

improve our

operating and

financial systems

and will need to recruit suitable employees and crew for our vessels.

Our current operating and financial

systems may not be adequate

if we further expand the size

of our fleet

and our attempts to

improve those systems may be

ineffective. In addition, if we

expand our fleet further,

we

will

need

to

recruit

suitable

additional

seafarers

and

shoreside

administrative

and

management

personnel. While we have not

experienced any difficulty in recruiting

to date, we cannot guarantee

that we

will

be

able

to

continue

to

hire

suitable

employees

if

we

expand

our

fleet.

If

we

or

our

crewing

agents

encounter business or

financial difficulties,

we may not

be able to

adequately staff our

vessels. If we

are

unable to grow our financial and

operating systems or to recruit suitable employees

should we determine

to expand our fleet, our financial performance may be adversely affected,

among other things.

We may have to pay tax on U.S. source income, which would reduce

our earnings.

Under

the

U.S.

Internal

Revenue

Code

of

1986, as

amended,

or

the

Code,

50%

of

the

gross

shipping

income

of

a

vessel-owning

or

chartering

corporation,

such

as

ourselves

and

our

subsidiaries,

that

is

attributable to

transportation that

begins or

ends, but

that does

not both

begin and

end, in

the United

States

is characterized as

U.S. source shipping

income and such

income is generally

subject to a

4% U.S. federal

income tax

without allowance

for deductions,

unless that

corporation qualifies

for exemption

from tax under

Section 883 of the Code and the Treasury Regulations promulgated thereunder.

We expect that

we and each

of our subsidiaries

qualify for this

statutory tax exemption

for the 2022

taxable

year and

we will take

this position

for U.S. federal

income tax return

reporting purposes. However,

there

are factual circumstances beyond our control that could cause us to lose the benefit of this tax exemption

in future years

and thereby

become subject

to U.S.

federal income

tax on

our U.S. source

shipping income.

For example, in

certain circumstances we

may no longer

qualify for exemption

under Code Section 883

for

a particular taxable year if shareholders, other than “qualified shareholders”, with a five percent or greater

interest in our common shares owned, in the aggregate, 50% or more of our outstanding common shares

for more

than half

the days

during the

taxable year.

Due to

the factual

nature of the

issues involved, we

can give no assurances on our tax-exempt status or that of any of our subsidiaries.

If we or

our subsidiaries are not

entitled to this exemption

under Section 883 of

the Code for any

taxable

year, we or our subsidiaries would

be subject for those

years to a 4%

U.S. federal income

tax on our gross

U.S.-source shipping income. The imposition of this taxation

could have a negative effect on our business

and would

result in

decreased earnings

available for

distribution to

our shareholders,

although, for

the 2022

taxable year, we estimate

our maximum

U.S. federal

income tax

liability to be

immaterial if

we were

subject

to

this

U.S.

federal

income

tax.

See

“Item

10.

Additional

Information—E.

Taxation"

for

a

more

comprehensive discussion of U.S. federal income tax considerations.

U.S. federal tax authorities

could treat us as

a “passive foreign investment

company”, which could

have adverse U.S. federal income tax consequences to U.S. shareholders.

A foreign corporation will be treated as a

“passive foreign investment company”, or PFIC, for U.S. federal

income tax purposes if

either (1) at least 75%

of its gross income

for any taxable year

consists of certain

types of “passive income”

or (2) at least 50% of

the average value of the

corporation's assets produce or

are

held

for

the

production

of

those

types

of

“passive

income.”

For

purposes

of

these

tests,

“passive

income” includes

dividends, interest,

gains from

the sale

or exchange

of investment

property,

and rents

36

and royalties

other than rents

and royalties which

are received

from unrelated parties

in connection with

the

active

conduct

of

a

trade

or

business.

For

purposes

of

these

tests,

income

derived

from

the

performance of services does not constitute “passive income.” U.S. shareholders of a PFIC are subject to

a disadvantageous

U.S. federal

income tax

regime with

respect to

the income

derived by

the PFIC,

the

distributions they receive from the PFIC and the gain, if any, they derive from the sale or other disposition

of their shares in the PFIC.

Based on

our current

and proposed

method of

operation, we

do not

believe that

we will

be a

PFIC with

respect to any taxable

year. In this regard, we intend

to treat the gross income

we derive or are

deemed to

derive from

our time

chartering activities

as services

income, rather

than rental

income. Accordingly,

we

believe that

our income

from our

time chartering activities

does not

constitute “passive

income,” and the

assets that we own and operate in connection with

the production of that income do not constitute assets

that produce or are held for the production of “passive income”.

There

is

substantial

legal

authority

supporting

this

position

consisting

of

case

law

and

U.S.

Internal

Revenue Service, or “IRS”, pronouncements concerning the characterization of income derived from time

charters and voyage charters as services income for other

tax purposes. However, it should be noted that

there

is

also

authority

which

characterizes

time

charter

income

as

rental

income

rather

than

services

income for other tax

purposes. Accordingly,

no assurance can be given

that the IRS or

a court of law will

accept this position, and there is a risk

that the IRS or a court of

law could determine that we are a PFIC.

Moreover, no assurance can be

given that we

would not constitute

a PFIC for any

future taxable year

if the

nature and extent of our operations changed.

If the

IRS or

a court

of law

were to

find that

we are

or have

been a

PFIC for

any taxable

year,

our U.S.

shareholders would

face adverse

U.S. federal

income tax

consequences. Under

the PFIC

rules, unless

those shareholders make

an election available

under the Code

(which election could

itself have adverse

consequences for such shareholders),

such shareholders would

be subject to

U.S. federal income

tax at

the then

prevailing U.S.

federal income

tax rates

on ordinary

income plus

interest upon

excess distributions

and upon any gain

from the disposition of

our common stock,

as if the excess

distribution or gain

had been

recognized ratably

over the

shareholder's holding

period of

our common

stock. See

“Item 10.

Additional

Information—E.

Taxation–United

States

Taxation

of

U.S.

Holders–PFIC

Status

and

Significant

Tax

Consequences" for

a more

comprehensive discussion

of the

U.S. federal

income tax

consequences to

U.S.

holders of our common stock if we are or were to be treated as a PFIC.

Risks Relating to Our Common Stock

We cannot

assure you that

our board of

directors will continue to

declare dividends on shares

of

our common stock in the future.

In order to position us to take advantage of market opportunities in a then-deteriorating market, our board

of directors, beginning with the fourth quarter of 2008, suspended

our common stock dividend. As a result

of improving market conditions in

2022, our board of directors

elected to declare quarterly dividends

and a

special non-cash dividend.

Our board of

directors have also declared

a cash dividend

paid on March

20,

2023 and a noncash dividend payable

on May 16, 2023 and

we intend to declare and

pay quarterly cash

dividends with

respect to

the next three

quarters of

2023 in

an amount

of not

less than $0.15

per share.

The actual

declaration of

future cash

dividends, and

the establishment

of record

and payment

dates, is

subject

to

final

determination

by

our

board

of

directors

each

quarter

after

its

review

of

the

company's

financial performance.

We

cannot assure

you that

our board

of directors

will declare

and pay

dividends

going

forward.

Our

dividend

policy

is

assessed

by

our

board

of

directors

from

time

to

time,

based

on

prevailing market

conditions,

available cash,

uses of

capital,

contingent liabilities,

the

terms

of

our

loan

facilities, our

growth

strategy and

other cash

needs, the

requirements of

Marshall Islands

law and

other

factors deemed relevant to

our board of directors.

In addition, other external

factors, such as

our lenders

imposing restrictions

on our

ability to

pay

dividends under

the

terms

of

our

loan

facilities, may

limit

our

37

ability to pay dividends.

Further, under the terms of our loan agreements, we

may not be permitted to pay

dividends that would result in an event of default or if an event of default

has occurred and is continuing.

Our

growth

strategy

contemplates

that

we

will

finance

the

acquisition

of

additional

vessels

through

a

combination of debt

and equity financing

on terms acceptable

to us.

If financing is

not available to

us on

acceptable terms, our

board of directors

may determine to

finance or refinance

acquisitions with cash

from

operations, which

could also

reduce or

even eliminate

the amount

of cash

available for

the

payment of

dividends.

Marshall

Islands

law

generally

prohibits

the

payment

of

dividends

other

than

from

surplus

(retained

earnings and

the excess

of consideration

received for

the sale of

shares above

the par value

of the shares)

or while

a company

is insolvent

or would

be rendered

insolvent by

the payment

of such

a dividend.

We

may not have sufficient surplus in the future to pay dividends.

In

addition, our

ability to

pay dividends

to holders

of our

common shares

will be

subject to

the rights

of

holders

of

our

Series

B

Preferred

Shares,

which

rank

senior

to

our

common

shares

with

respect

to

dividends,

distributions and

payments

upon

liquidation. No

cash dividend

may

be

paid

on

our

common

stock unless full cumulative dividends have been or contemporaneously are being paid or provided for on

all outstanding

Series B

Preferred Shares

for all

prior and

the then-ending

dividend periods.

Cumulative

dividends

on

our

Series

B

Preferred

Shares

accrue

at

a

rate

of

8.875%

per

annum

per

$25.00

stated

liquidation preference

per Series

B Preferred

Share, subject

to increase

upon the

occurrence of

certain

events, and are payable, as and if declared

by our board of directors, on January

15, April 15, July 15 and

October 15 of each year, or, if any such dividend payment date otherwise would

fall on a date that is not a

business

day,

the

immediately succeeding

business

day.

For

additional information

about

our

Series

B

Preferred Shares, please see the section entitled "Description of Registrant's Securities to be Registered"

of our

registration statement

on Form

8-A filed

with the

SEC on

February 13,

2014 and

incorporated by

reference herein.

The

market

prices

and

trading

volume

of

our

shares

of

common

stock

may

experience

rapid

and

substantial price

volatility, which

could cause

purchasers of

our common

stock to

incur substantial

losses.

Our shares of our common stock may experience

similar rapid and substantial price volatility unrelated

to our financial

performance, which

could cause purchasers

of our common

stock to

incur substantial

losses,

which

may

be

unpredictable

and

not

bear

any

relationship

to

our

business

and

financial

performance. Extreme fluctuations in

the market price of

our common stock may

occur in response to

strong

and

atypical

retail

investor

interest,

including

on

social

media

and

online

forums,

the

direct

access by retail investors

to broadly available trading

platforms, the amount and

status of short interest

in

our

common

stock

and

our

other

securities,

access

to

margin

debt,

trading

in

options

and

other

derivatives on our shares of common

stock and any related hedging

and other trading factors:

If

there

is

extreme

market

volatility

and

trading

patterns

in

our

common

stock,

it

may

create

several

risks for purchasers of

our shares, including the following:

●

the market

price

of our

common stock

may

experience

rapid and

substantial

increases or

decreases

unrelated

to

our

operating

performance

or

prospects,

or

macro

or

industry

fundamentals;

●

if

our

future

market

capitalization

reflects

trading

dynamics

unrelated

to

our

financial

performance or

prospects, purchasers

of our

common stock

could incur

substantial losses

as prices decline once

the level of market volatility

has abated;

38

●

if the

future market

price of

our common

stock declines,

purchasers of

shares of

common

stock in this offering may be unable to

resell such shares at or above the price

at which they

acquired

them.

We

cannot

assure

such

purchasers

that

the

market

of

our

common

stock

will not fluctuate or decline significantly in the

future, in which case investors in this offering

could incur substantial losses.

Further, we may

incur rapid and

substantial increases

or decreases

in our common

stock price in

the

foreseeable future

that may

not coincide

in timing

with the

disclosure of

news or

developments by

or

affecting us.

Accordingly, the

market price

of our

common stock

may fluctuate

dramatically, and

may

decline

rapidly,

regardless

of

any

developments

in

our

business.

Overall,

there

are

various

factors,

many

of

which

are

beyond

our

control,

that

could

negatively

affect

the

market

price

of

our

common

stock or result in

fluctuations in the price or trading

volume of our common

stock, including:

●

actual or anticipated variations in our annual or quarterly

results of operations, including our

earnings estimates and whether we

meet market expectations with regard

to our earnings;

●

our ability to pay dividends or

other distributions;

●

publication

of

research

reports

by

analysts

or

others

about

us

or

the

shipping

industry

in

which we

operate which

may be

unfavorable, inaccurate,

inconsistent or

not disseminated

on a regular basis;

●

changes in market valuations of similar

companies;

●

market reaction

to any

additional

equity, debt

or other

securities that

we may

issue in

the

future, and which may or

may not dilute the holdings

of our existing stockholders;

●

additions or departures of key

personnel;

●

actions by institutional or

significant stockholders;

●

short interest in our

common stock or our

other securities and the market

response to such

short interest;

●

the

dramatic

increase

in

the

number

of

individual

holders

of

our

common

stock

and

their

participation in social media platforms

targeted at speculative investing;

●

speculation in the press or investment community about our company or industries in which

we operate;

●

strategic actions by us or

our competitors, such as

acquisitions or other investments;

●

legislative, administrative, regulatory or

other actions affecting our business,

our industry;

●

investigations, proceedings, or litigation

that involve or affect

us;

●

the occurrence of

any of the

other risk factors

included in this

registration statement of

which

this prospectus forms a part;

and

●

general market and economic

conditions.

39

Since we are

incorporated in the Marshall

Islands, which does

not have a

well-developed body of

corporate law, you

may have more difficulty

protecting your interests than

shareholders of a U.S.

corporation.

Our corporate affairs are governed by our amended and restated articles of incorporation and bylaws and

by

the

Marshall

Islands

Business

Corporations

Act,

or

the

BCA.

The

provisions

of

the

BCA

resemble

provisions of the

corporation laws of

a number of

states in the

United States. However,

there have been

few judicial cases in the

Marshall Islands interpreting the BCA. The

rights and fiduciary responsibilities of

directors under the

laws of the

Marshall Islands are

not as clearly

established as the

rights and fiduciary

responsibilities of

directors under statutes

or judicial

precedent in existence

in the United

States. The

rights

of

shareholders

of

the

Marshall

Islands

may

differ

from

the

rights

of

shareholders

of

companies

incorporated in the United States. While the BCA

provides that it is to be interpreted according to the

laws

of the State of Delaware and other states with substantially similar legislative provisions, there have been

few, if any, court

cases interpreting

the BCA

in the

Marshall Islands

and we

cannot predict

whether Marshall

Islands courts

would reach

the same

conclusions as

U.S. courts.

Thus, you

may have

more difficulty

in

protecting your

interests in

the face

of actions

by the

management, directors

or controlling

shareholders

than

would

shareholders

of

a

corporation

incorporated

in

a

U.S.

jurisdiction

which

has

developed

a

relatively more substantial body of case law.

As a

Marshall Islands

corporation and

with some

of our

subsidiaries being

Marshall Islands

entities

and

also

having

subsidiaries

in

other

offshore

jurisdictions,

our

operations

may

be

subject

to

economic substance requirements, which could impact our business.

We

are

a

Marshall

Islands

corporation

and

some

of

our

subsidiaries

are

Marshall

Islands

entities.

The

Marshall Islands has

enacted economic substance laws and

regulations with which we

may be obligated

to

comply.

We

believe

that

we

and

our

subsidiaries

are

compliant

with

the

Marshall

Islands

economic

substance requirements. However, if there were a change in the requirements or interpretation thereof, or

if there were

an unexpected

change to our

operations, any

such change

could result

in noncompliance

with

the economic substance legislation and

related fines or other

penalties, increased monitoring and audits,

and dissolution of the non-compliant entity,

which could have an adverse effect on our business, financial

condition or operating results.

EU Finance ministers rate jurisdictions for tax rates and tax transparency,

governance and real economic

activity.

Countries that are

viewed by such

finance ministers as

not adequately cooperating,

including by

not implementing sufficient

standards in

respect of

the foregoing,

may be put

on a “grey

list” or a

“blacklist”.

As of December 31, 2022, the Marshall Islands remained "white-listed" by

the EU. However,

on February

14,

2023,

the

Marshall

Islands

was

placed

by

the

EU

on

its

list

of

non-cooperative jurisdictions

for

tax

purposes, on the grounds that Marshall Islands

facilitates offshore structures and arrangements aimed at

attracting profits without real economic substance as they

failed to fulfil their commitments to

the Code of

Conduct Group with regard to economic

substance requirements. At present,

the impact of being included

on the

list of

non-cooperative jurisdictions

for tax

purposes is

unclear.

Although we

understand that

the

Marshall Islands is committed to full cooperation with the

EU and expects to be moved back to

the "white

list" in

October 2023,

subject to

review by

the EU

Council, there

is no assurance

that such

a reclassification

will occur.

If

the

Marshall

Islands

is

not

removed

from

the

list

and

sanctions

or

other

financial,

tax

or

regulatory

measures were applied

by European Member

States to countries

on the list

or further economic

substance

requirements were imposed by the Marshall Islands, our business

could be harmed.

EU member states have agreed upon a set of measures, which they can choose to apply against grey-

or

blacklisted

countries,

including

monitoring

and

audits,

withholding

taxes,

special

documentation

requirements and anti-abuse provisions. The European Commission has stated

it will continue to support

member states'

efforts to

develop a

more coordinated

approach to

sanctions for

the listed

countries. EU

40

legislation

prohibits

EU

funds

from

being

channeled

or

transited

through

entities

in

countries

on

the

blacklist. Other jurisdictions in which we operate could be put on

the blacklist in the future.

Certain existing

shareholders will

be able

to exert

considerable influence

over matters

on which

our shareholders are entitled to vote.

As

of

the

date

of

this

annual

report,

Mrs.

Semiramis

Paliou,

our

Chief

Executive

Officer

and

Director,

beneficially owns 16,883,779 shares, or approximately 15.9% of

our outstanding common stock, which is

held indirectly

through entities

over which

she exercises

sole voting

power.

Mrs. Paliou

controls 10,675

shares of

Series C

Preferred Stock,

par value

$0.01 per

share, issued

on January

31, 2019,

and 400

shares

of Series D

Preferred Stock,

issued on

June 22,

2021. The

Series C Preferred

Stock vote

with our common

shares and

each share

of the

Series C

Preferred Stock

entitles the

holder thereof

to 1,000

votes on

all

matters submitted to a vote of the common stockholders of the Issuer.

The Series D Preferred Stock vote

with

the

common

shares of

the

Company,

and

each share

of

the

Series D

Preferred

Stock

entitles the

holder thereof

to up

to 100,000

votes, on

all matters

submitted

to a

vote of

the stockholders

of the

Company,

subject

to

a

maximum

number

of

votes

eligible

to

be

cast

by

such

holder

derived

from

the

Series

D

Preferred

Shares

and

any

other

voting

security

of

the

Company

held

by

the

holder

to

be

equal

to

the lesser of (i) 36% of the

total number of votes entitled

to vote on any

matter put to shareholders of the

Company and

(ii) the

sum of

the holder’s

aggregate voting

power derived

from securities

other than

the

Series

D

Preferred

Stock

and

15%

of

the

total

number

of

votes

entitled

to

be

cast

on

matters

put

to

shareholders of the Company.

Through her beneficial ownership of common shares and shares of Series

C

Preferred

Stock

and

Series

D

Preferred

Stock,

Mrs.

Paliou

controls

36%

of

the

vote

of

any

matter

submitted to the vote

of the common shareholders.

Please see "Item 7.

Major Shareholders and Related

Party Transactions—A. Major

Shareholders." While Mrs. Paliou and the entities

controlled by Mrs. Paliou

have no

agreement, arrangement

or understanding

relating to

the voting

of their

shares of

our common

stock, they

are able

to influence

the outcome

of matters

on which

our shareholders

are entitled

to vote,

including the election of directors and other significant corporate actions. This concentration of ownership

may

have

the

effect

of

delaying,

deferring

or

preventing

a

change

in

control,

merger,

consolidation,

takeover or other

business combination.

This concentration of

ownership could

also discourage a

potential

acquirer from

making a

tender offer or

otherwise attempting

to obtain

control of

us, which

could in

turn have

an adverse effect

on the market

price of our

shares. So long

as our

Chief Executive Officer

continues to

own a significant amount

of our equity,

even though the amount

held by her represents

less than 50% of

our voting power,

she will continue to

be able to exercise

considerable influence over our

decisions. The

interests of these shareholders may be different from your interests.

Future sales of our common stock could cause the market price

of our common stock to decline.

Our

amended

and

restated

articles

of

incorporation

authorize

us

to

issue

up

to

200,000,000

shares

of

common stock, of which, as

of December 31, 2022, 102,653,619

shares were outstanding. The

number of

shares of

common stock available

for sale

in the public

market is

limited by restrictions

applicable under

securities laws

and agreements

that we

and our

executive officers,

directors and

principal shareholders

have entered into.

Sales of a substantial

number of shares of our

common stock in the public

market, or the perception that

these

sales

could

occur,

may

depress the

market

price

for

our

common

stock.

These

sales

could

also

impair our ability to raise additional capital through the sale of our equity

securities in the future.

41

Anti-takeover

provisions

in

our

organizational

documents

could

make

it

difficult

for

our

shareholders to

replace or

remove our

current board

of directors

or have

the effect

of discouraging,

delaying or

preventing a

merger or

acquisition, which

could adversely

affect

the market

price of

our common stock.

Several provisions of our amended and

restated articles of incorporation and

bylaws could make it difficult

for our shareholders to change the composition of our board

of directors in any one year, preventing them

from changing the composition

of management. In addition,

the same provisions

may discourage, delay

or

prevent a merger or acquisition that shareholders may consider

favorable.

These provisions include:

●

authorizing

our board

of directors

to

issue “blank

check” preferred

stock without

shareholder

approval;

●

providing for a classified board of directors with staggered, three-year

terms;

●

prohibiting cumulative voting in the election of directors;

●

authorizing

the

removal of

directors

only for

cause and

only

upon

the

affirmative

vote

of

the

holders

of

a

majority

of

the

outstanding shares

of

our

common

stock

entitled

to

vote

for

the

directors;

●

prohibiting shareholder action by written consent;

●

limiting the persons who may call special meetings of shareholders;

and

●

establishing advance notice requirements for nominations for election to our board of directors

or for proposing matters that can be acted on by shareholders at shareholder

meetings.

In addition,

we have

adopted a

Stockholders Rights

Agreement, dated

January 15,

2016, pursuant

to which

our board of directors may cause the substantial dilution of any person

that attempts to acquire us without

the approval of our board of directors.

These

anti-takeover

provisions,

including

provisions

of

our

Stockholders

Rights

Agreement,

could

substantially impede the ability of public shareholders to benefit from a change in control and, as a result,

may adversely affect the

market price of our

common stock and

your ability to

realize any potential

change

of control premium.

Our Series B Preferred Shares

are senior obligations of ours

and rank prior to our common

shares

with

respect

to

dividends,

distributions

and

payments

upon

liquidation,

which

could

have

an

adverse effect on the value of our common shares.

The rights of the holders

of our Series B Preferred Shares

rank senior to the obligations to

holders of our

common shares. Upon our liquidation, the holders of Series

B Preferred Shares will be entitled to receive

a liquidation preference

of $25.00 per share,

plus all accrued but

unpaid dividends, prior and

in preference

to any distribution to the holders of any other class of our equity securities, including our common shares.

The existence of the Series B Preferred

Shares could have an adverse effect on the value

of our common

shares.

Risks Relating to Our Series B Preferred Stock

42

We may not have

sufficient cash from our operations to

enable us to pay dividends on

our Series

B Preferred Shares following the payment of expenses and the establishment

of any reserves.

We

pay quarterly

dividends on

our Series

B Preferred

Shares only

from funds

legally available

for such

purpose when,

as and

if

declared by

our board

of

directors. We

may

not have

sufficient

cash available

each

quarter to

pay dividends.

The amount

of

dividends we

can pay

on our

Series B

Preferred Shares

depends upon the amount of cash we generate from and use in our

operations, which may fluctuate.

The

amount of

cash we

have

available for

dividends on

our Series

B Preferred

Shares will

not

depend

solely on our

profitability. The

actual amount of cash

we have available to

pay dividends on our

Series B

Preferred Shares depends on many factors, including the

following:

●

changes in

our operating

cash flow, capital expenditure

requirements, working

capital requirements

and other cash needs;

●

restrictions under our existing or future credit facilities or any future debt securities on our

ability to

pay dividends if an

event of default has

occurred and is

continuing or if

the payment of the

dividend

would result in

an event of

default, or under

certain facilities

if it would

result in the

breach of certain

financial covenants;

●

the amount of any cash reserves established by our board of directors;

and

●

restrictions under

Marshall Islands

law,

which generally

prohibits the

payment of

dividends other

than from

surplus (retained

earnings and

the excess

of consideration

received for

the sale

of shares

above the par value of the shares) or while a company is insolvent or would be rendered insolvent

by the payment of such a dividend.

The amount of cash we generate from our operations may differ materially

from our net income or loss for

the period, which

is affected by

non-cash items, and

our board of

directors in its discretion

may elect not

to declare

any dividends.

As a

result of

these and

the other

factors mentioned

above, we

may pay

dividends

during

periods

when

we

record

losses

and

may

not

pay

dividends

during

periods

when

we

record

net

income.

The Series B Preferred Shares represent perpetual equity

interests.

The Series B

Preferred Shares represent

perpetual equity interests

in us and,

unlike our indebtedness,

will

not give

rise to

a claim for

payment of a

principal amount at

a particular date.

As a

result, holders of

the

Series

B Preferred

Shares may

be required

to

bear the

financial risks

of

an investment

in the

Series B

Preferred Shares for an indefinite period

of time. In addition, the Series B

Preferred Shares will rank junior

to all our

indebtedness and other

liabilities, and to

any other senior

securities we may

issue in the

future

with respect to assets available to satisfy claims against us.

Our Series

B Preferred

Shares are

subordinate to

our indebtedness,

and your

interests could

be

diluted

by

the

issuance

of

additional

preferred

shares,

including

additional

Series

B

Preferred

Shares, and by other transactions.

Our Series B Preferred Shares are subordinated to all of our existing and future indebtedness. Therefore,

our ability to pay dividends on, redeem

or pay the liquidation preference on

our Series B Preferred Shares

in liquidation or

otherwise may be

subject to prior

payments due to

the holders of

our indebtedness. Our

existing indebtedness restricts, and our future indebtedness may include restrictions on, our

ability to pay

dividends on

or

redeem preferred

shares. Our

amended and

restated

articles of

incorporation currently

authorize the issuance

of up to

25,000,000 preferred

shares, par value

$0.01 per share.

Of these preferred

shares, 1,000,000 shares have been

designated Series A Participating

Preferred Stock, 5,000,000 shares

43

have been

designated Series

B Preferred

Shares, 10,675

are designated

as Series

C Preferred

Shares

and 400 are designated as

Series D Preferred Shares. The

Series B Preferred Shares

are senior in rank

to the

Series A

Participating Preferred

Shares. The

issuance of

additional Series

B Preferred

Shares or

other preferred shares

on a parity

with or senior

to the Series B

Preferred Shares would

dilute the interests

of holders of our

Series B Preferred Shares, and any issuance

of preferred shares senior to

our Series B

Preferred Shares or of additional indebtedness could affect our ability to pay dividends on, redeem or pay

the liquidation preference

on our Series

B Preferred Shares.

The Series B

Preferred Shares do

not contain

any provisions

affording the

holders of

our Series

B Preferred

Shares protection

in the

event of

a highly

leveraged or other transaction,

including a merger or the

sale, lease or conveyance

of all or substantially

all our assets

or business, which might

adversely affect the

holders of our Series

B Preferred Shares, so

long as the rights of our Series B Preferred Shares are not directly

materially and adversely affected.

We may redeem the

Series B Preferred

Shares, and you

may not be

able to reinvest

the redemption

price you receive in a similar security.

Since February 14, 2019, we

may, at our option, redeem Series B Preferred Shares,

in whole or in part, at

any time or from time to time. We may have an incentive to redeem Series B Preferred Shares voluntarily

if market conditions allow us

to issue other preferred shares

or debt securities at a

rate that is lower than

the dividend

on the

Series B

Preferred Shares.

If we

redeem Series

B Preferred

Shares, then

from and

after the

redemption date,

your dividends

will cease

to accrue

on your

Series B

Preferred Shares,

your

Series B Preferred Shares shall no longer be deemed outstanding and all your rights as a holder of those

shares

will

terminate,

except

the

right

to

receive

the

redemption

price

plus

accumulated

and

unpaid

dividends, if any,

payable upon redemption. If

we redeem the

Series B Preferred

Shares for any

reason,

you may not be able to reinvest the redemption price you receive

in a similar security.

Market interest rates may adversely affect the value of our Series B Preferred

Shares.

One of

the factors that

may influence the

price of

our Series B

Preferred Shares is

the dividend yield

on

the Series B Preferred

Shares (as a percentage of

the price of our

Series B Preferred Shares) relative to

market

interest

rates.

An

increase

in

market

interest

rates,

which

are

currently

at

low

levels

relative

to

historical

rates,

may

lead

prospective

purchasers

of

our

Series

B

Preferred

Shares

to

expect

a

higher

dividend yield, and

higher interest rates

would likely increase

our borrowing costs

and potentially decrease

funds available for

distribution. Accordingly,

higher market

interest rates could

cause the

market price

of

our Series B Preferred Shares to decrease.

As a holder of Series B Preferred Shares you have extremely

limited voting rights.

Your voting rights as a holder of Series

B Preferred Shares are

extremely limited. Our common

shares are

the only outstanding class or series of our shares carrying full voting rights. Holders of Series B Preferred

Shares have

no voting

rights other

than the

ability,

subject to

certain exceptions,

to elect

one director

if

dividends for six

quarterly dividend

periods (whether

or not consecutive)

payable on

our Series B

Preferred

Shares are in arrears and certain other limited protective voting

rights.

Our

ability

to

pay

dividends

on

and

to

redeem

our

Series

B

Preferred

Shares

is

limited

by

the

requirements of Marshall Islands law.

Marshall Islands

law provides that

we may

pay dividends on

and redeem the

Series B

Preferred Shares

only to the

extent that assets

are legally available

for such purposes.

Legally available

assets generally

are

limited to our surplus, which essentially represents our retained earnings and

the excess of consideration

received by us for

the sale of shares

above the par value

of the shares. In

addition, under Marshall Islands

law we

may not

pay dividends

on or

redeem Series

B Preferred

Shares if

we are

insolvent or

would be

rendered insolvent by the payment of such a dividend or the making

of such redemption.

44

The amount of your

liquidation preference is

fixed and you will

have no right

to receive any greater

payment regardless of the circumstances.

The

payment

due

upon

a

liquidation

is

fixed

at

the

redemption

preference

of

$25.00

per

share

plus

accumulated and

unpaid dividends

to

the

date

of

liquidation. If,

in the

case of

our

liquidation, there

are

remaining

assets

to

be distributed

after

payment

of

this

amount,

you

will

have

no right

to

receive

or

to

participate in these

amounts. Furthermore,

if the market

price for your

Series B Preferred

Shares is greater

than

the

liquidation

preference,

you

will

have

no

right

to

receive

the

market

price

from

us

upon

our

liquidation.

Item 4.

Information on the Company

A.

History and development of the Company

Diana Shipping Inc. is a holding company

incorporated under the laws of Liberia in

March 1999 as Diana

Shipping

Investments

Corp.

In

February

2005,

the

Company’s

articles

of

incorporation

were

amended.

Under the amended

and restated articles

of incorporation, the

Company was

renamed Diana Shipping

Inc.

and was re-domiciled from the Republic

of Liberia to the Republic of

the Marshall Islands.

Our executive

offices

are located

at Pendelis

16,

175 64

Palaio Faliro,

Athens, Greece.

Our telephone

number at

this

address is +30-210-947-0100. Our agent and

authorized representative in the

United States is our wholly-

owned

subsidiary,

Bulk

Carriers

(USA)

LLC,

established in

September

2006,

in

the

State

of

Delaware,

which is located

at 2711 Centerville Road, Suite

400, Wilmington, Delaware

19808. The SEC

maintains an

Internet

site

that

contains

reports,

proxy

and

information

statements,

and

other

information

regarding

issuers that file electronically with

the SEC. The address of

the SEC's Internet site

is http://www.sec.gov.

The address of the Company's Internet site is http://www.dianashippinginc.com.

Vessel acquisitions

In February

2022, we

took delivery

of Leonidas

P.C. (ex Magnolia), a

2011 built Kamsarmax

dry bulk

vessel

of 82,165 dwt,

which we agreed

to acquire from

an unaffiliated third

party in July

2021, for a

purchase price

of $22.0 million.

In

March

2022,

we

also

took

delivery

of

Florida,

a

Japanese

new-building

Capesize

dry

bulk

vessel

of

approximately 181,500 dwt,

which we agreed

to acquire from an

unaffiliated third party in

December 2020,

for a purchase price of $60.2 million including commissions.

In August

2022, we

entered into

a master

agreement with

Sea Trade

Holdings Inc.

(or “Sea

Trade”),

an

unaffiliated third party,

to acquire nine

Ultramax vessels for an

aggregate purchase price of

$330 million,

of which $220

million would be

paid in cash

and $110

million through an

aggregate of 18,487,393

newly

issued common shares of the Company, issuable on the delivery of each vessel. In addition to the master

agreement,

in

August

2022,

we

also

entered

into

nine

separate

memoranda

of

agreement

for

the

acquisition

of

each

vessel

and

issued

nine

warrants

to

Sea

Trade,

for

the

issuance

of

the

shares,

exercisable

on

the

delivery

date

of

each

vessel.

During

the

fourth

quarter

of

2022,

the

Company

took

delivery of eight vessels for

an aggregate value of

$263.7 million, of which $67.9

million was the value of

the newly

issued common

shares. On

January 30,

2023, we

took delivery

of the

ninth vessel

for $24.2

million in cash, funded through our loan with Nordea,

and issued 2,033,613 common shares to Sea Trade

of $7.8 million value.

In February 2023, we

signed a Memorandum of Agreement

to acquire from an

unaffiliated third party the

vessel

Nord Potomac

, a 2016

built Ultramax dry bulk

vessel, for a

purchase price of

$27.9 million, which

we intend to finance

through debt financing. We

expect to take

delivery of the vessel

by the beginning of

April 2023.

45

Vessel disposals

In June 2022, we

sold to OceanPal Inc.,

or OceanPal, a related party

company, the

vessel

Baltimore

, for

a sale price of $22.0 million before commissions, of which $4.4 million was paid in cash and

$17.6 million

through

25,000

Series

D

Convertible

Preferred

shares.

The

vessel

was

delivered

to

OceanPal

on

September 20, 2022.

In January

2023, we

sold to

an unrelated

third party

the vessel

Aliki

for the

purchase price

of $15.08

million.

The vessel was delivered to her new owners on February 8, 2023.

In February 2023, we sold to OceanPal, the

vessel

Melia

for the purchase price of $14.0 million, of

which

$4.0 million

was paid

in cash and

$10.0 million

through 13,157

of OceanPal

Series D Convertible

Preferred

Shares. The vessel was delivered to her new owners on February 8,

2023.

Please

read

Note

4

– Advances

for

vessel

acquisitions

and

Vessels,

net to

our

consolidated

financial

statements, included elsewhere in

this Annual Report for

a full description of

the Company’s acquisitions

and sales of vessels as of December 31, 2022.

Sale and leaseback agreements

In

March

2022,

we

sold

Florida

to

an

unrelated

third

party

for

$50.0

million

in

a

sale

and

leaseback

transaction and we chartered the vessel back from the buyer for a period of ten years at $13,500 per day.

The

Company

has

purchase

options

beginning

at

the

end

of

the

third

year

of

the

agreement.

If

not

repurchased earlier,

the

Company

has the

obligation to

repurchase the

vessel for

$16.4 million,

on

the

expiration of the lease on the tenth year.

In August, 2022, we entered into two sale and leaseback agreements with two unaffiliated Japanese third

parties

to

sell

New Orleans

and

Santa Barbara,

for

an

aggregate amount

of

$66.4 million.

The vessels

were

delivered

to

their

buyers

on

September

8,

2022

and

September

12,

2022,

respectively

and

the

Company chartered in both

vessels under bareboat charter

parties for a

period of eight

years, each, and

has purchase options beginning

at the end of the

third year of each vessel's

bareboat charter period. If

not

repurchased earlier,

the Company

has the

obligation to

repurchase the

vessels for

$13 million

each, on

the expiration of each lease on the eighth year.

On December

6, 2022,

we sold

DSI Andromeda

to an

unrelated third

party for

$29.9 million

and leased

back the

vessel under

a bareboat

agreement, for

a period

of ten

years, under

which the

Company pays

hire, monthly in advance. The Company

has purchase options beginning

at the end of the third

year of the

bareboat charter period and if not repurchased earlier,

the Company has the obligation to repurchase the

vessel for $8.05 million,

on the expiration of the lease on the tenth year.

Dividends

During 2022,

we paid

total dividends of

$0.9 per

share, or

$79.8 million. More

specifically,

on March

21,

2022, we paid a cash dividend on our common stock amounting

to $17.2 million, or $0.20 per share, to all

shareholders of record as of March 9, 2022.

On June 17, 2022, we

paid a cash dividend

on our common stock

amounting to $21.6 million,

or $0.25 per

share, to all shareholders of record as of June 6, 2022.

On August 19, 2022, we paid a cash dividend

on our common stock amounting to

$23.7 million, or $0.275

per share, to all shareholders of record as of August 8, 2022.

On

December 15,

2022, we

paid

a

cash

dividend on

our

common

stock amounting

to

$17.3 million,

or

46

$0.175 per share, to all shareholders of record as of November

28, 2022.

In

addition

to

the

cash

dividends,

on

December

15,

2022,

we

distributed

25,000

Series

D

Convertible

Preferred Shares

of OceanPal,

acquired as

part of

the non-cash

consideration for

the sale

of

Baltimore

described above,

as a

non-cash dividend amounting

to $18.2

million to

our shareholders

of record

as of

November 28, 2022.

On March 20, 2023, we paid a cash dividend

on our common stock amounting to $16

million, or $0.15 per

share, to

all shareholders

of record

as of

March 13,

2023. We

have also

declared the

distribution to

our

shareholders

of

record

as

of

April

24,

2023

of

the

13,157

Series

D

Convertible

Preferred

Shares

of

OceanPal acquired as part of the non-cash consideration of the

sale of

Melia

described above.

Please

read

Note

9

– Capital

Stock

and

Changes

in

Capital

Accounts

to

our

consolidated

financial

statements,

included

elsewhere

in

this

Annual

Report for

a

full

description of

the

Company’s

dividends

distribution as of December 31, 2022.

Loans

On September

30, 2022,

the Company

entered into

a $200

million loan

agreement to

finance the

acquisition

price of 9 Ultramax vessels. The Company drew down $197.2 million under the loan, in tranches for each

vessel on their delivery to the Company.

During 2022, we early prepaid

an aggregate amount of

$57.5 million of outstanding

debt due to the

sale of

Baltimore

to OceanPal, and

DSI Andromeda

,

Santa Barbara

and

New Orleans

, following their sale under

a sale and leaseback.

In February 2023,

we early prepaid

an additional amount

of $8.1 million

of outstanding debt

due to the

sale

of

Melia

to OceanPal and

Alik

i to an unaffiliated third party. In March 2023, we early prepaid $11.8 million,

being the outstanding balance of our loan with DNB Bank ASA.

Please read Note 6 – Long-term debt to

our consolidated financial statements, included elsewhere in this

Annual Report for a full description of the Company’s loan facilities as of December

31, 2022.

B.

Business overview

We specialize

in the ownership

and bareboat charter-in

of dry bulk

vessels, determined as one

business

segment. Each of our vessels is owned through a separate wholly-owned

subsidiary.

As of the date of

this report, our fleet, owned

and chartered-in, consisted of 41 dry

bulk carriers, of which

nine

were

Ultramax,

seven

were

Panamax,

six

were

Kamsarmax,

five

were

Post-Panamax,

ten

were

Capesize and four

were Newcastlemax vessels,

having a combined

carrying capacity of

approximately 4.7

million dwt

and a

weighted average

age of

9.9 years.

We

have also

agreed to

acquire the

vessel

Nord

Potomac

, a 2016 built Ultramax dry bulk vessel, expected to be delivered

by the beginning of April 2023.

As

of

December

31,

2022,

our

operating

fleet

consisted

of

42

dry

bulk

carriers,

of

which

eight

were

Ultramax, eight

were Panamax,

six were

Kamsarmax, five

were Post-Panamax,

eleven were

Capesize and

four were

Newcastlemax vessels,

having a

combined carrying

capacity of

approximately 4.9

million dwt

and a weighted

average age of

10.2 years. As

of December 31,

2022, the Company

had agreed to

acquire

a 2016 built Ultramax dry bulk vessel of 60,309 dwt, delivered on

January 30, 2023.

As

of

December

31,

2021,

our

operating

fleet

consisted

of

33

dry

bulk

carriers,

of

which

eight

were

Panamax,

five

were

Kamsarmax,

five

were

Post-Panamax,

eleven

were

Capesize

and

four

were

Newcastlemax

vessels,

having

a

combined

carrying

capacity

of

approximately

4.3

million

dwt

and

a

47

weighted average

age of

10.4 years.

As of

December 31,

2021, the

Company had

agreed to

acquire a

2011 built Kamsarmax dry bulk vessel of 82,165 dwt, delivered on February 16, 2022 and a Capesize dry

bulk vessel of 181,500

dwt, which was

sold and leased

back under a

bare boat charter

on March 29,

2022.

As of December

31, 2020, our

operating fleet

consisted of 40

dry bulk carriers,

of which 13

were Panamax,

five were Kamsarmax, five were Post-Panamax, 13 were Capesize

and four were Newcastlemax vessels,

having a combined carrying capacity of approximately 5.0

million dwt and a weighted average age of 10.2

years. As of

December 31, 2020, the

Company had agreed to

sell the vessels

Coronis, Sideris G.S.

and

Oceanis, of

which Coronis

and Sideris

GS were

delivered to

their buyers

in January

2021 and

Oceanis

was delivered in March 2021.

During

2022,

2021

and

2020,

we

had

a

fleet

utilization

of

98.9%,

99.1%

and

97.9%,

respectively,

our

vessels achieved daily

time charter equivalent

rates of

$22,735, $15,759 and

$10,910, respectively,

and

we generated revenues of $290.0 million, $214.2 million and $169.7

million, respectively.

We

operate

our

vessels

worldwide,

in

markets

that

have

historically

exhibited

seasonal

variations

in

demand and,

as a

result, in

charter hire

rates. The

dry bulk

carrier market

is typically

stronger in the

fall

and winter months in

anticipation of increased

consumption of coal and

other raw materials

in the northern

hemisphere during the winter months. In addition, unpredictable weather patterns

in these months tend to

disrupt vessel scheduling

and supplies of certain

commodities. This seasonality

has a limited direct

impact

on our operating

results as we

charter our vessels to

customers pursuant to medium-term

and long-term

time charter agreements.

Management of Our Fleet

The commercial and technical management of our fleet, owned and

bareboat chartered-in, as well as the

provision of administrative services

relating to the fleet’s

operations, are carried out

by our wholly-owned

subsidiary, Diana Shipping Services S.A., which we refer to as DSS, and Diana Wilhelmsen Management

Limited, a 50/50 joint

venture with Wilhelmsen

Ship Management, which

we refer to as

DWM. In exchange

for

providing

us

with

commercial

and

technical

services,

personnel

and

office

space,

we

pay

DSS

a

commission,

which

is

a

percentage

of

the

managed

vessels’

gross

revenues,

a

fixed

monthly

fee

per

managed vessel and an additional monthly fee for the administrative services provided to Diana Shipping

Inc. Such services may

include budgeting, reporting,

monitoring of bank accounts,

compliance with banks,

payroll

services

and

any

other

possible

service

that

Diana

Shipping

Inc.

would

require

to

perform

its

operations. Similarly, in exchange

for providing

us with

commercial and

technical services,

we pay

to DWM

a commission

which is

a percentage

of the

managed vessels’

gross revenues

and a

fixed management

monthly fee

for each

managed vessel.

The amounts

deriving from

the agreements

with DSS

are considered

inter-company transactions and, therefore, are eliminated from

our consolidated financial statements. The

management fees

and commissions

deriving from

the agreements

with DWM

are included

in our

statement

of

operations

in

“Management

fees

to

“Voyage

Expenses”,

“Advances

for

vessel

acquisitions” and “Vessels, net”.

Steamship Shipbroking Enterprises

Inc., or Steamship,

a related party

controlled by our

Chairman of the

Board, Mr. Simeon Palios until January 15, 2023

and our CEO Mrs. Semiramis Paliou

thereafter, provides

brokerage services to us, since June 1, 2010. Brokerage

fees are included in “General and Administrative

expenses”

in

our

statement

of

operations.

The

terms

of

this

relationship

are

currently

governed

by

a

Brokerage Services Agreement dated July 1, 2022.

The following table presents certain information

concerning the dry bulk carriers in

our fleet, as of the date

of this annual report.

Fleet Employment (As of March 17, 2023)

48

VESSEL

SISTER

SHIPS*

GROSS

RATE (USD

PER DAY)

COM**

CHARTERERS

DELIVERY DATE

TO

CHARTERERS***

REDELIVERY DATE TO

OWNERS****

NOTES

BUILT DWT

9 Ultramax Bulk Carriers

1

DSI Phoenix

A

13,250

5.00%

ASL Bulk Marine

Limited

4/Nov/22

4/Mar/2024 - 4/May/2024

2017 60,456

2

DSI Pollux

A

17,000

5.00%

Delta Corp Shipping

Pte. Ltd.

27/Oct/22

27/Dec/2023 - 27/Feb/2024

2015 60,446

3

DSI Pyxis

A

17,100

4.75%

Cargill Ocean

Transportation

Singapore Pte. Ltd.

16/Oct/22

16/Aug/2023 - 16/Oct/2023

2018 60,362

4

DSI Polaris

A

13,100

5.00%

ASL Bulk Marine

Limited

12/Nov/22

12/May/2024 - 12/Jul/2024

2018 60,404

5

DSI Pegasus

A

14,000

5.00%

Reachy Shipping

(SGP) Pte. Ltd.

7/Dec/22

15/Jul/2024 - 15/Sep/2024

2015 60,508

6

DSI Aquarius

B

14,200

5.00%

Engelhart CTP Freight

(Switzerland) SA

1/Feb/23

10/Jan/2024 - 25/Mar/2024

2016 60,309

7

DSI Aquila

B

13,300

5.00%

Western Bulk Carriers

AS

22/Nov/22

15/Sep/2023 - 15/Nov/2023

2015 60,309

8

DSI Altair

B

14,400

5.00%

Western Bulk Pte. Ltd.

28/Dec/22

25/Jun/2023 - 25/Aug/2023

2016 60,309

9

DSI Andromeda

B

14,250

5.00%

Western Bulk Carriers

AS

17/Nov/22

16/Oct/2023 - 16/Dec/2023

1, 2

2016 60,309

10

Nord Potomac (tbr.

DSI Drammen)

-

3

2016 63,379

8 Panamax Bulk Carriers

11

MELIA

11,000

5.00%

Asahi Shipping Co.,

Ltd.

10/Dec/22

04/Feb/2023

4

2005 76,225

12

ARTEMIS

21,250

4.75%

Cargill International

S.A., Geneva

21/Mar/22

20/Jun/2023 -20/Aug/2023

2006 76,942

13

LETO

25,500

4.75%

Aquavita International

S.A.

3/Oct/21

29/Jan/2023

5

2010 81,297

14,500

4.75%

Cargill International

S.A., Geneva

29/Jan/23

1/Mar/2024 - 30/Apr/2024

14

SELINA

C

22,000

5.00%

Speed Logistics

Marine Limited

18/Jun/22

15/Apr/2023 - 30/Apr/2023

6

2010 75,700

15

MAERA

C

12,000

4.75%

Cargill International

S.A., Geneva

16/Dec/22

28/Oct/2023 - 28/Dec/2023

2013 75,403

16

ISMENE

18,500

4.75%

Cargill International

S.A., Geneva

23/Nov/21

10/Jan/2023

2013 77,901

14,000

5.00%

ST Shipping and

Transport Pte. Ltd.

10/Jan/23

20/Aug/2023 - 10/Oct/2023

17

CRYSTALIA

D

12,500

5.00%

Reachy Shipping

(SGP) Pte. Ltd.

12/Nov/22

1/Sep/2023 - 15/Oct/2023

2014 77,525

18

ATALANDI

D

24,500

4.75%

Aquavita International

S.A.

5/Oct/21

15/Feb/2023

2014 77,529

13,250

4.75%

15/Feb/23

5/Mar/2024 - 5/May/2024

6 Kamsarmax Bulk Carriers

19

MAIA

E

25,000

5.00%

Hyundai Glovis Co.

Ltd.

24/May/22

20/Sep/2023 -20/Nov/2023

7

49

2009 82,193

20

MYRSINI

E

15,000

5.00%

Salanc Pte. Ltd.

22/Nov/22

20/Apr/2024 - 28/Jun/2024

2010 82,117

21

MEDUSA

E

26,000

4.75%

Cargill International

S.A., Geneva

9/Mar/22

15/May/2023 - 15/Jul/2023

2010 82,194

22

MYRTO

E

18,000

5.00%

Tata NYK Shipping

Pte. Ltd.

3/Aug/22

15/Jul/2023 - 15/Sep/2023

8

2013 82,131

23

ASTARTE

21,500

5.00%

Tongli Shipping Pte.

Ltd.

30/Jan/22

15/Apr/2023 - 15/Jun/2023

2013 81,513

24

LEONIDAS P. C.

24,500

4.75%

Cargill International

S.A., Geneva

18/Feb/22

28/Feb/2023

9

2011 82,165

17,000

4.75%

17/Mar/23

17 Feb 2024 - 17 Apr 2024

5 Post-Panamax Bulk Carriers

25

ALCMENE

17,100

5.00%

SwissMarine Pte. Ltd.,

Singapore

25/Nov/21

02/Jan/2023

2010 93,193

13,000

5.00%

2/Jan/23

10/Jan/2024 - 25/Mar/2024

26

AMPHITRITE

F

14,250

5.00%

Cobelfret S.A.

9/Nov/22

1/Dec/2023 - 15/Feb/2024

2012 98,697

27

POLYMNIA

F

24,750

5.00%

CLdN Cobelfret SA,

Luxembourg

4/Feb/22

14/Jan/2023

10

2012 98,704

15,000

5.00%

14/Jan/23

1/Apr/2024 - 31/May/2024

28

ELECTRA

G

17,500

5.00%

Refined Success

Limited

2/Jul/22

1/Apr/2023 - 15/May/2023

6

2013 87,150

29

PHAIDRA

G

25,000

5.00%

Comerge Shipping

Co., Limited

24/Nov/22

04/Mar/2023

11,12

2013 87,146

10,000

5.00%

Salanc Pte. Ltd.

4/Mar/23

17/Apr/2023

13

11 Capesize Bulk Carriers

30

ALIKI

24,500

5.00%

Koch Shipping Pte.

Ltd., Singapore

21/Feb/22

02/Feb/2023

4

2005 180,235

31

SEMIRIO

H

19,700

5.00%

C Transport Maritime

Ltd., Bermuda

15/Dec/21

15/Aug/2023 - 15/Nov/2023

2007 174,261

32

BOSTON

H

20,500

5.00%

Aquavita International

S.A.

15/Jul/22

1/Apr/2023 - 31/May/2023

2007 177,828

33

HOUSTON

H

13,000

5.00%

EGPN Bulk Carrier

Co., Limited

21/Nov/22

1/Jul/2024 - 31/Aug/2024

2009 177,729

34

NEW YORK

H

23,000

5.00%

C Transport Maritime

Ltd., Bermuda

2/Jul/22

10/Jun/2023 - 25/Aug/2023

2010 177,773

35

SEATTLE

I

26,500

5.00%

Solebay Shipping

Cape Company

Limited, Hong Kong

2/Mar/22

1/Oct/2023 - 15/Dec/2023

2011 179,362

36

P.

S. PALIOS

I

31,000

5.00%

Classic Maritime Inc.

11/Jun/22

15/Apr/2024 - 30/Jun/2024

2013 179,134

37

G. P. ZAFIRAKIS

J

22,750

4.75%

Cargill International

S.A., Geneva

1/Dec/21

12/Jan/2023

14

2014 179,492

17,000

5.00%

Solebay Shipping

Cape Company

Limited, Hong Kong

12/Jan/23

15/Jun/2024 - 15/Aug/2024

38

SANTA BARBARA

J

29,500

4.75%

Cargill International

S.A., Geneva

19/Mar/22

10/May/2023 - 10/Jul/2023

15

2015 179,426

39

NEW ORLEANS

32,000

5.00%

Engelhart CTP Freight

(Switzerland) SA

25/Mar/22

20/Nov/2023 - 31/Jan/2024

15

2015 180,960

50

40

FLORIDA

25,900

5.00%

Bunge S.A., Geneva

29/Mar/22

29/Jan/2027 - 29/May/2027

2

2022 182,063

4 Newcastlemax Bulk Carriers

41

LOS ANGELES

K

26,250

5.00%

Koch Shipping Pte.

Ltd., Singapore

30/Jan/22

15/Jan/2023

2012 206,104

17,700

5.00%

Nippon Yusen

Kabushiki Kaisha,

Tokyo

15/Jan/23

20/May/2024 - 5/Aug/2024

42

PHILADELPHIA

K

26,000

5.00%

C Transport Maritime

Ltd., Bermuda

12/Apr/22

1/Feb/2024 - 15/Apr/2024

2012 206,040

43

SAN FRANCISCO

L

30,500

5.00%

Koch Shipping Pte.

Ltd., Singapore

18/Feb/22

18/Feb/2023

16

2017 208,006

22,000

5.00%

SwissMarine Pte. Ltd.,

Singapore

18/Feb/23

5/Jan/2025 - 5/Mar/2025

44

NEWPORT NEWS

L

28,000

5.00%

Koch Shipping Pte.

Ltd., Singapore

16/Dec/21

1/Jul/2023 - 30/Sep/2023

2017 208,021

* Each dry bulk carrier is a “sister ship”, or closely similar, to other dry bulk carriers that have the same letter.

** Total

commission percentage paid to third parties.

*** In case of newly acquired vessel with time charter attached, this date refers to the expected/actual date of delivery of the vessel

to the Company.

**** Range of redelivery dates, with the actual date of redelivery being at the Charterers’ option, but subject to the terms, conditions,

and exceptions of the particular charterparty.

1The fixture includes the option for redelivery of vessel east of Suez against a gross ballast bonus of US$250,000.

2Bareboat chartered-in for a period of ten years.

3The Company expects to take delivery of the vessel by the beginning of April 2023.

4Vessel sold and delivered to her new Owners on February 8, 2023.

5Aquavita International S.A. has agreed to compensate the owners for the early redelivery of the vessel until the minimum agreed

redelivery date, February 1, 2023.

6Based on latest information.

7Vessel off hire for 3.93 days.

8Vessel on scheduled drydocking from October 12, 2022 to November 7, 2022.

9Vessel on scheduled drydocking from February 28, 2023 to March 17, 2023.

10The charter rate was US$10,000 per day for the first 30 days of the charter period.

11Redelivery date based on an estimated time charter trip duration of about 95 days.

12Charter includes a one time ballast bonus payment of US$300,000.

13Redelivery date based on an estimated time charter trip duration of about 45 days. In the event that the trip duration exceeds fifty

(50) days, the gross charter rate will be US$13,000 per day, minus a 5% commission paid to third parties, for each additional day.

14The Charterers will compensate the Owners for the excess of the charter party period at the rate of 123% of the average of the

Baltic Cape Index 5TC average for the days exceeding the period or the vessel’s present charter party rate whichever is higher.

15Bareboat chartered-in for a period of eight years.

16Koch Shipping Pte. Ltd. has agreed to compensate the owners for the early redelivery of the vessel by paying the difference

between the new rate and the previous rate, from the redelivery date from the Charterers, to March 1, 2023.

Our Customers

Our customers include regional and international companies, such

as Cargill International S.A., Glencore

Grain

B.V.,

Koch

Shipping

Pte

Ltd

and

Swissmarine

Services

S.A.

During

2022,

two

of

our

charterers

accounted for

34% of

our revenues:

Cargill (19%)

and Koch

(15%). During

2021, one

of our

charterers

51

accounted for 10% of our revenues: Cargill

(10%). During 2020, two of our charterers

accounted for 34%

of our revenues: Cargill (18%), Koch (16%).

We charter our

dry bulk

carriers, owned

and bareboat

chartered-in, to

customers pursuant

to time charters.

Under our time charters, the charterer typically

pays us a fixed daily charter hire rate and

bears all voyage

expenses, including the cost

of bunkers (fuel

oil) and canal and

port charges. We

remain responsible for

paying the

chartered vessel's

operating expenses,

including the

cost of

crewing, insuring,

repairing and

maintaining the

vessel. In

2022, we

paid commissions that

ranged from

4.75% to

5.0% of

the total

daily

charter hire

rate of

each charter

to unaffiliated

ship brokers

and to

in-house brokers

associated with

the

charterer, depending on the number of brokers involved with arranging the charter.

We strategically monitor developments in the dry bulk shipping industry on a regular basis and, subject to

market

demand,

seek

to

adjust

the

charter

hire

periods

for

our

vessels

according

to

prevailing

market

conditions. In order to take advantage of relatively stable cash flow and high utilization rates,

we fix some

of our vessels on long-term time

charters. Currently, the

majority of our vessels are employed on

short to

medium-term time

charters, which

provides us

with flexibility in

responding to

market developments.

We

continuously evaluate our balance of

short-

and long-term charters and extend

or reduce the charter hire

periods of the vessels in our fleet according to the developments in

the dry bulk shipping industry.

Charter Hire Rates

Charter hire

rates fluctuate

by varying

degrees among

dry bulk

carrier size

categories. The

volume and

pattern of

trade in

a small

number of

commodities

(major bulks)

affect demand

for larger

vessels. Therefore,

charter rates

and vessel

values of

larger vessels

often show

greater volatility. Conversely, trade

in a

greater

number

of

commodities (minor

bulks)

drives

demand

for

smaller

dry

bulk

carriers.

Accordingly,

charter

rates and vessel values for those vessels are usually subject

to less volatility.

Charter

hire

rates

paid

for

dry

bulk

carriers

are

primarily

a

function

of

the

underlying

balance

between

vessel supply and demand, although at

times other factors may play a

role. Furthermore, the pattern seen

in

charter

rates

is

broadly

mirrored

across

the

different

charter

types

and

the

different

dry

bulk

carrier

categories. In the

time charter market,

rates vary depending

on the length

of the charter

period and vessel-

specific factors such as age, speed and fuel consumption.

In the

voyage charter

market, rates

are, among

other things,

influenced by

cargo size,

commodity,

port

dues and canal transit fees, as well

as commencement and termination regions.

In general, a larger cargo

size is quoted

at a lower

rate per ton

than a smaller

cargo size.

Routes with

costly ports or

canals generally

command higher rates

than routes

with low port

dues and

no canals to

transit. Voyages

with a

load port

within a

region that

includes ports

where vessels

usually discharge

cargo or

a discharge

port within

a region

with

ports

where

vessels

load

cargo

also

are

generally

quoted

at

lower

rates,

because

such

voyages

generally increase vessel utilization by

reducing the unloaded portion

(or ballast leg) that is

included in the

calculation of the return charter to a loading area.

Within the dry bulk shipping industry,

the charter hire rate references, most likely to be monitored, are the

freight rate indices

issued by the

Baltic Exchange. These

references are based

on actual charter

hire rates

under

charters

entered

into

by

market

participants

as

well

as

daily

assessments

provided

to

the

Baltic

Exchange by a panel

of major shipbrokers.

The Baltic Panamax

Index is the index

with the longest

history.

The Baltic Capesize Index and Baltic Handymax Index are

of more recent origin.

The Baltic

Dry Index,

or BDI,

a daily

average of

charter rates

in 20

shipping routes

measured on

a time

charter and voyage

basis and covering Capesize,

Panamax, Supramax, and Handysize

dry bulk carriers

ranged from a low of 393

in May 2020 to a high of

2,097 in October. In 2021, the BDI ranged from

a low of

1,303 in February to a

high of 5,650 in October.

In 2022, the BDI ranged

from a high of 3369

on May 23,

52

2022 to a low of 965 on

August 31, 2022 to drop again

to a low of 530 on February 16,

2023. The BDI has

since recovered from the February 2023 levels and closed at 1484 on

March 23, 2023.

The Dry Bulk Shipping Industry

The

global

dry

bulk

carrier

fleet

could

be

divided

into

seven

Diana Shipping - 20-F annual report 2022

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