The TOP Ships placement could raise $5 million in initial gross proceeds through the sale of senior convertible notes and warrants to one institutional investor. The tanker operator announced the agreement on October 27, 2026, and said it expected the first closing on or about October 28, subject to customary conditions.

Key Takeaways

  • The first tranche carries $5,555,555.56 in note principal and a 10% original issue discount.
  • A conditional second tranche could bring another $5 million in gross proceeds.
  • The notes, warrants and commitment shares can result in additional common shares being issued.

TOP Ships placement terms

The unsecured notes will pay annual interest of 8% if paid in cash or 10% if paid in common shares. They mature 12 months after issuance, though TOP Ships may extend the maturity to 18 months. An extension would increase the applicable note’s principal by 5%.

The initial conversion price will be the lower of the closing share price immediately before issuance or the average closing price over the preceding five days, subject to a $0.50 floor. At the investor’s option, an alternative conversion price will be the greater of that floor or 85% of the lowest daily volume-weighted average share price during the 10 trading days before conversion.

Warrants and additional shares

At the first closing, TOP Ships expects to issue warrants exercisable for 19,841,269 common shares at $0.28 per share. The warrants will be immediately exercisable and expire five years after issuance. The stated warrant exercise price is separate from the $0.50 floor applicable to note conversions.

The company also expects to issue 992,064 commitment shares, or pre-funded warrants in lieu of shares, at the first closing. Conversions and warrant exercises could increase the number of shares outstanding.

Second tranche and registration

Subject to conditions in the purchase agreement, TOP Ships may sell a further $5,555,555.56 in note principal and additional warrants in a second closing, for another $5 million in gross proceeds. Commitment shares or pre-funded warrants would also be issued at that closing.

The company agreed to file a registration statement with the US Securities and Exchange Commission covering resale of the commitment shares and shares underlying the notes and warrants. Maxim Group is acting as sole placement agent.

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