ATHENS, Greece, March 9, 2016 /PRNewswire/ -- Paragon
Shipping Inc. ("Paragon" or the "Company") today announced the
following updates on its debt agreements and newbuilding
contracts:
Syndicated Loan Facility dated May 6,
2014
On March 9, 2016, the Company
agreed with the syndicated banks, subject to certain conditions, to
sell the mortgaged vessels, namely the M/V Coral Seas, the M/V
Golden Seas, the M/V Prosperous Seas, the M/V Precious Seas, the
M/V Priceless Seas and the M/V Proud Seas, to unaffiliated third
parties in exchange for the full and final settlement of the
outstanding amount of the respective facility.
Newbuilding Contracts
The Company is currently in discussions with Jiangsu Yangzijiang
Shipbuilding Co., or Yangzijiang, to extend the deliveries of its
three Kamsarmax newbuilding drybulk carriers (Hull numbers YZJ1144,
YZJ1145 and YZJ1142), towards the end of 2016, subject to certain
conditions, at no extra cost to the Company. The balance due to
Yangzijiang for the delivery of the three Kamsarmax newbuildings is
currently higher than the estimated market value of these
vessels.
In addition, the Company did not take delivery of the Ultramax
newbuilding drybulk carrier with Hull no. DY4050 from Yangzhou
Dayang Shipbuilding Co. Ltd., or Dayang, that was scheduled to be
delivered in the fourth quarter of 2015. Furthermore, the Company
sent to Dayang a notice for the cancellation of the Ultramax
newbuilding drybulk carrier with Hull no. DY4052 that was scheduled
to be delivered before the end of December
2015. Dayang rejected such cancellation notice and the case
is currently under arbitration proceedings in London.
8.375% Senior Unsecured Notes due 2021 ("Unsecured
Notes")
In relation to the issued and outstanding Unsecured Notes, the
Company did not proceed with the interest payment of $0.5 million, which was originally due on
February 16, 2016, due to lack of
liquidity. Pursuant to the Unsecured Notes indenture, the Company
is under the 30-day grace period to make such payment that will
expire on March 17, 2016. The Company
is still lacking the liquidity to make the $0.5 million interest payment upon the expiration
of the said grace period.
The Company has already announced an offer, as further amended
and extended, to exchange all properly delivered and accepted
Unsecured Notes for shares of Paragon's common stock by
5:00 p.m. (New York City time) on March 18, 2016 (the "Extended Expiration Date").
Settlement for all of the Unsecured Notes validly delivered and not
withdrawn on or before the Extended Expiration Date, will be on
March 23, 2016. Each holder of an
Unsecured Note (each a "Holder" and collectively the "Holders") who
validly delivers and does not withdraw all Unsecured Notes held by
such Holder, shall receive four (4) shares of Paragon's common
stock for each Unsecured Note, which shall include any accrued and
unpaid interest thereon (the "Exchange Offer"). 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 Company is currently evaluating a number of strategic
alternatives.
Conference Call Details
The Company's management team will host a conference call to
discuss recent developments and details regarding the Exchange
Offer on March 15, 2016, at
9:00 am Eastern Time.
Participants should dial into the call ten minutes before the
scheduled time using the following numbers 1-888-348-8931
(USA) or +1-412-902-4248
(international) to access the call. A replay of the conference call
will be available for seven days and can be accessed by dialing
1-877-870-5176 (USA) or
+1-858-384-5517 (international) and using passcode 10082520.
Forward-Looking Statements
Certain statements in this press release are "forward-looking
statements" within the meaning of the Private Securities Litigation
Act of 1995. These forward-looking statements are based on our
current expectations and beliefs and are subject to a number of
risk factors and uncertainties that could cause actual results to
differ materially from those described in the forward-looking
statements. All statements other than statements of historical fact
are statements that could be deemed forward-looking statements,
including but not limited to any statements regarding the Exchange
Offer and Consent Solicitation. Risks, uncertainties and
assumptions include the possibility that expected benefits may not
materialize as expected as well as other risks that have been
included in filings with the Securities and Exchange Commission,
all of which are available at www.sec.gov.
About Paragon Shipping Inc.
Paragon Shipping is an international shipping company
incorporated under the laws of the Republic of the Marshall Islands with executive offices in
Athens, Greece, specializing in
the transportation of drybulk cargoes. Paragon Shipping's current
fleet consists of six drybulk vessels with a total carrying
capacity of 297,879 dwt. In addition, Paragon Shipping's current
newbuilding contracts consist of three Kamsarmax drybulk carriers.
The Company's common shares and Paragon Notes trade on the NASDAQ
Capital Market under the symbols "PRGN" and "PRGNL," respectively.
For more information, visit: www.paragonship.com. The
information contained on Paragon Shipping's website does not
constitute part of this press release.
Contacts:
Paragon Shipping Inc.
ir@paragonshipping.gr
DresnerAllenCaron
Rudy
Barrio (Investors)
rbarrio@dresnerallencaron.com
(212) 691-8087
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SOURCE Paragon Shipping Inc.