paragon AG Increases Share Capital to Accelerate Company Growth

paragon AG Increases Share Capital to Accelerate Company Growth

- Capital increase approved from authorized capital

- Share capital to be increased by up to 10%

- Private placement by means of accelerated book-building process

- Founder Klaus Dieter Frers to retain majority interest

Delbrück, Germany, October 4, 2016 - With the approval of the Supervisory Board, the Management Board of paragon AG (ISIN DE0005558696) has today resolved to increase the company's share capital by up to 10 percent in exchange for a cash contribution in order to further accelerate company growth, particularly in the Electromobility division.

The company's share capital is to be increased by up to EUR 411,478.00 with the partial use of the existing authorized capital. As part of a private placement by means of an accelerated book-building process, the plan is to offer the new shares, which will carry dividend rights as of January 1, 2016, to qualified and other investors in accordance with the applicable exemption provisions governing domestic and foreign private placements.

Majority shareholder and company founder Klaus Dieter Frers, who sits on the Management Board, has committed himself to the company by signing a subscription declaration agreement with the company to subscribe for the new shares as part of the accelerated book-building process, thus safeguarding his majority interest in the future. Upon completion of the accelerated book-building process, the company's Management Board will announce the placement price of the new shares. It will not be significantly below the current share price of the paragon AG share. The transaction will be supported by Hauck & Aufhäuser as sole global coordinator and sole bookrunner.

The automotive sector is undergoing a dynamic change, with developments largely driven by the technological trends of electrification and connectivity. At the same time, consumers all over the world are changing their mobility requirements in line with their increasingly mobile lifestyles and heightened awareness of environmental and health issues.

"We are currently experiencing a particularly exciting phase in our almost 30-year history - one in which we can make great use of our unique competitive advantages," explains Klaus Dieter Frers, founder and CEO of paragon AG. "The great interest shown by automotive manufacturers in our technological innovations provides us with a solid foundation in terms of sustainably occupying the new market niches that will shape future generations."

As a long-standing partner of premium German auto manufacturers, paragon AG has used its business model - which is based on the independent development and production of innovative products and solutions that enhance individual driver experience - to successfully position itself to benefit considerably from the dynamism on the global market. With its particle sensor, its in-car communication technology, and its MirrorPilot(R), for example, the company is an innovation leader in its established divisions. At the same time, the younger Body Kinematics division is currently developing complete aerodynamics concepts that will improve the energy consumption - and consequently the range - of future generations of passenger vehicles.

The most recently established division, Electromobility, was spun off into the two wholly owned Voltabox subsidiaries in Germany and the US back in 2014, thus laying the groundwork to occupy this particularly dynamic market segment in a speedy and focused manner. Since 2015, the successful start-up has been developing and producing high-performance lithium-ion battery systems in Germany and the US for use in large commercial vehicles, which make exceptionally high demands in terms of safety and intelligent battery management systems optimized for the application concerned.

In the field of public transportation, Voltabox - via its partner company Vossloh Kiepe - already supplies public sector organizations in Germany, Italy, Austria, Switzerland, and the US with special battery systems for trolleybuses. In the field of intralogistics, customized Voltabox battery solutions for forklift trucks are already being distributed by Triathlon. A very wide-ranging strategic partnership with Joy Global concerning the deployment of intelligent battery systems in commercial vehicles used in the global mining sector was announced most recently, with the partnership encompassing all platforms. As a result, the Electromobility division now accounts for almost half of the lifetime order backlog at paragon AG.

The resolved capital increase is intended to safeguard dynamic company growth in existing and new market segments and to ensure a balance sheet structure that is appropriate to this level of growth.

Disclaimer:

THIS PUBLICATION IS FOR INFORMATIONAL PURPOSES ONLY AND CONSTITUTES NEITHER AN OFFER TO SELL NOR AN INVITATION TO TREAT NOR AN INVITATION TO SUBSCRIBE TO SHARES OR OTHER SECURITIES OF PARAGON AG. A PUBLIC OFFERING OF SECURITIES IS NOT TAKING PLACE AND IS NOT INTENDED.

THIS PUBLICATION AND THE INFORMATION CONTAINED HEREIN ARE NOT INTENDED FOR DIRECT OR INDIRECT DISCLOSURE OR PUBLICATION IN THE UNITED STATES OF AMERICA, CANADA, AUSTRALIA, OR JAPAN. THE PARAGON AG SECURITIES DESCRIBED HEREIN ARE NOT AND WILL NOT BE REGISTERED PURSUANT TO THE APPLICABLE VERSION OF THE U.S. SECURITIES ACT OF 1933 ("SECURITIES ACT") OR THE LAWS OF A U.S. STATE AND MAY ONLY BE SOLD OR OFFERED FOR SALE IN THE UNITED STATES OF AMERICA ON THE BASIS OF AN EXEMPTION FROM THE REGISTRATION REQUIREMENT SET OUT IN THE SECURITIES ACT OR THE LAWS OF A U.S. STATE OR IN THE EVENT OF SUCH REGULATIONS BEING NON-APPLICABLE. THERE WILL BE NO PUBLIC OFFERING OF SECURITIES IN THE UNITED STATES OF AMERICA.

Further information is available at www.paragon.ag/en/investors. Follow us on Twitter @paragon_ir

Company Profile

Listed in the regulated market (Prime Standard) of Deutsche Börse AG in Frankfurt am Main, paragon AG (ISIN DE0005558696) develops, produces, and sells innovative automotive electronics solutions. The portfolio of this direct supplier to the automotive industry includes products in the business segments of Sensors, Acoustics, Cockpit, E-mobility and Body Kinematics. In addition to its headquarters in Delbrück (North Rhine-Westphalia), paragon AG and its subsidiaries have locations in Suhl (Thuringia), Nuremberg (Bavaria), St. Georgen (Baden-Württemberg), and Bexbach (Saarland), as well as in Kunshan (China) and Austin (Texas, USA).

Financial Press Contact & Investor Relations

paragon AG
Dr. Kai Holtmann
Artegastraße 1
D-33129 Delbrück
Phone: +49 (0) 52 50 - 97 62-140
Fax: +49 (0) 52 50 - 97 62-63
E-Mail: kai.holtmann@paragon.ag