DryShips announced that the independent members of its Board of Directors have approved the exercise of the Company’s right under its previously announced Secured Revolving Facility Agreement with Sifnos Shareholders Inc. (“Sifnos”), a company controlled by Mr. George Economou.
Specifically, the Company has elected to convert $10,000,000 of the outstanding principal amount of the loan into 100,000,000 preferred shares of the Company. Each preferred share will have five votes and will be mandatorily converted into common shares of the Company on a one to one basis within three months after the issuance thereof on a date selected by the Company.
Ziad Nakhleh, Chief Financial Officer of the Company, commented:
“We are pleased to have strengthened our balance sheet by $10 million in line with the current trading price of our stock in this difficult environment for drybulk companies. In addition, to avoid being delisted from the NASDAQ during the first half of 2016, the Company believes it will be necessary to effect a reverse stock split of its common shares. The issuance of the preferred stock, together with the continued support of Sifnos, which has expressed its support of the Company’s intention to maintain its NASDAQ listing, will assist us in obtaining the required shareholder approval to effect a reverse stock split.”