Form 4: International Seaways CEO Lois Zabrocky Awarded Restricted Stock Units and Performance Restricted Stock Units

Lois Zabrocky, CEO of International Seaways, received grants of restricted stock units and performance-based restricted stock units on March 12, 2025, under the company's 2020 Management Incentive Plan.

Summary

• On March 12, 2025, International Seaways (INSW) granted CEO Lois K. Zabrocky 42,300 restricted stock units (RSUs) and 42,300 performance restricted stock units (PRSUs) under the 2020 Management Incentive Plan.
• The RSUs vest in three equal installments on the first, second, and third anniversaries of the grant date, with each unit representing the right to acquire one share of INSW common stock.
• Settlement of vested RSUs may be in shares of common stock or cash, as determined by the Human Resources and Compensation Committee.
• The PRSUs' vesting is contingent upon achievement of an operating performance metric (return on invested capital, or ROIC) and a market performance metric (total shareholder return, or TSR, relative to a peer group), each accounting for half of the granted PRSUs.
• The performance period for the PRSUs is from January 2, 2025, to December 31, 2027.
• The number of shares vesting from the PRSUs can range from 50% to 150% of the target amount, depending on the performance factor, and will be reported after certification by the Compensation Committee.

Sentiment

Score: 7

Explanation: The sentiment is neutral to positive. It reflects standard executive compensation practices with performance-based incentives, which are generally viewed favorably.

Positives

• The grant of RSUs and PRSUs aligns the CEO's interests with those of the shareholders.
• The performance-based vesting of PRSUs incentivizes the CEO to improve the company's ROIC and TSR.
• The vesting schedule of the RSUs encourages long-term commitment from the CEO.

Risks

• The actual value of the PRSUs is uncertain and depends on the company's future performance.
• The Compensation Committee has discretion in determining the form of settlement for vested RSUs, which could impact the value received by the CEO.

Future Outlook

The vesting of the RSUs and PRSUs is contingent upon continued service and achievement of performance metrics over the next three years.

Industry Context

Equity compensation is a common practice in the shipping industry to incentivize executives and align their interests with those of shareholders. The use of performance-based metrics like ROIC and TSR is also typical to drive specific financial goals.

Comparison to Industry Standards

• Companies like Teekay Corporation and DHT Holdings also utilize restricted stock units and performance-based equity awards for executive compensation.
• The specific metrics and vesting schedules vary, but the overall goal is to incentivize performance and retain key personnel.
• The ROIC and TSR metrics used by International Seaways are standard measures of financial and market performance in the shipping industry.

Stakeholder Impact

• Shareholders: The equity grants align management's interests with shareholder value creation.
• Employees: The grants may have a positive impact on employee morale by demonstrating the company's commitment to its leadership.

Next Steps

• The Compensation Committee will certify the achievement of the performance metrics for the PRSUs following the end of the measurement period (December 31, 2027).
• The vesting of the RSUs will occur annually on the anniversaries of the grant date.

Key Dates