Paragon Shipping Inc. raises US$ 10-million working capital in sale of newly-issued shares to an entity affiliated to its own chairman.
The Paragon Board agreed to sell 4,901,961 newly-issued shares of the Company's common stock to an entity affiliated with Mr. Michael Bodouroglou , the Company's Chairman and Chief Executive Officer, for total consideration of $10 million.
The proceeds will be used by the Company for working capital purposes. In addition, the Company will have the right, but not the obligation, to repurchase these newly-issued shares, at the same price per share at which they were sold in this private placement.
Commenting on the private placement, Michael Bodouroglou, the Company's Chairman and Chief Executive Officer stated, "In order to remove any uncertainty in satisfying a key condition precedent stipulated under our amended loan agreements, I have agreed with the Independent Members of the Board of Directors to purchase $10 million worth of shares in Paragon. This transaction strengthens the Company's financial position and ensures that it continues to meet NYSE listing requirements."
Paragon Shipping is a Marshall Islands-based international shipping company with executive offices in Athens, Greece, specializing in the transportation of drybulk cargoes. The Company's current fleet consists of twelve drybulk vessels with a total carrying capacity of 779,270 dwt. In addition, the Company's current newbuilding program consists of two Handysize drybulk carriers that are scheduled to be delivered in 2013 and two 4,800 TEU containerships that are scheduled to be delivered in 2014.