Paragon Shipping Inc. (the “Company”) announced the extension of
its previously announced offer to exchange all properly delivered and accepted 8.375% senior notes due 2021 issued in $25.00 denominations with CUSIP number 69913R-507 (each a “Paragon Note” and collectively the “Paragon Notes”) for shares of common stock (the “Common Stock”) of Paragon (the “Exchange Offer”) to 5:00 p.m. (New York City time) on March 18, 2016 (the “Extended Expiration Date”). Unless there is another extension, settlement for all of the Paragon Notes validly delivered and not withdrawn on or before the Extended Expiration Date, whether made prior to or after this announcement, will be on March 23, 2016 (the “Settlement Date”). Deliveries of Paragon Notes, whether made prior to or after this announcement, may be withdrawn and consents delivered pursuant to the Consent Solicitation, as defined below, may be revoked at any time until the Extended Expiration Date.
Based on information provided by the depository for the Exchange Offer, as of 5:00 p.m. (New York City time) on Friday March 4, 2016, approximately 95,813 Notes or 9.8% of the outstanding Paragon Notes had been delivered and not validly withdrawn from the Exchange Offer.
Each holder of a Paragon Note (each a “Holder” and collectively the “Holders”) who validly delivers and does not withdraw all Paragon Notes held by such Holder, shall receive four (4) shares of Common Stock on a post-reverse stock split basis for each Paragon Note, which shall include any accrued and unpaid interest thereon. Prior to this announcement and on an as adjusted basis, taking into account the 38-to-1 reverse stock split effectuated by the Company on March 1, 2016, all Holders that validly delivered and did not withdraw all Paragon Notes held by such Holder would have received two (2) shares of Common Stock regardless of the date the Notes were delivered. As part of the Exchange Offer, Holders will also be required to consent to the removal of certain covenants and sections of the Paragon Notes’ Indenture dated August 8, 2014 (the “Consent Solicitation” and together with the Exchange Offer, “Exchange Offer and Consent Solicitation”).
Holders who deliver and do not withdraw their Paragon Notes in the Exchange Offer and the Consent Solicitation by the Extended Expiration Date will not be entitled to any future interest on such Paragon Notes or any accrued but unpaid interest as of March 23, 2016, regardless of when the Exchange Offer and the Consent Solicitation closes, and any subsequent interest that would otherwise have been earned on such Paragon Notes will be deemed paid in full upon receipt of the Common Stock in the Exchange Offer and the Consent Solicitation.
Paragon also waives the minimum exchange condition that at least 80% of the aggregate principal amount of all outstanding Paragon Notes be validly delivered for exchange and not withdrawn.