Canterbury Park enters into agreement to convert its notes of

Paragon Pharmacies Limited 
WINNIPEG, July 31 /CNW/ - Canterbury Park Capital GP L.P., on behalf of private 
equity funds of which it is the general partner ("Canterbury"), announced today 
that it has entered into an agreement with Paragon Pharmacies Limited (PGN - 
TSXV) ("Paragon"), to convert its $20 million of Paragon notes, accrued 
interest, accrued interest adjustment and conversion inducement fee into 
additional common Shares ("Shares") of Paragon at a combined average price of 
approximately $0.65 per share ( the "Proposed Transaction" ). Specifically, 
Canterbury would: 

    -   Convert the $20,000,000 principal convertible notes (the "Notes") it
        holds to Paragon shares at $0.8028 per share;
    -   Receive accrued interest and accrued interest adjustment on the
        Notes, in the aggregate amount of $1,775,003, via additional Paragon
        shares at $0.35 per share; and
    -   Receive a conversion inducement fee equal to forgone interest for
        early conversion at the rate otherwise payable to the scheduled
        maturity of May 2, 2009 and an agreed interest adjustment amount, in
        the aggregate amount of $2,871,988, via additional Paragon shares at
        $0.35 per share.

The Proposed Transaction is conditional on, among other things, reaching a 
satisfactory agreement with Paragon's bank lender, approvals of other 
creditors, completion of the Autonomy Transaction described in the 
Corporation's press release of January 31, 2008, satisfactory completion of due 
diligence by Canterbury Park and all requisite regulatory approvals, including 
approval of the TSX Venture Exchange and the Competition Bureau. A special 
meeting of Paragon shareholders has been called for August 29, 2008 to consider 
the Autonomy Transaction. Meeting materials are expected to be mailed to 
Paragon shareholders for that meeting shortly. 
This transaction would result, assuming an August 31, 2008 closing date, in 
Canterbury acquiring, an additional 24,912,805 Shares. 
Prior to the proposed acquisition of these additional Shares, Canterbury owned 
10,072,455 Shares, and may have been deemed to own 36,860,260 Shares, 
representing approximately 49.7% of the issued and outstanding Shares. In the 
event of the completion of the proposed acquisition and the Autonomy 
Transaction, Canterbury would own approximately 48,262,377 Shares and may be 
deemed to own approximately 1,875,000 additional Shares, representing 
approximately 63% of the issued and outstanding Shares of the Company, 
calculated as if the warrants to acquire 1,875,000 additional Shares held by 
Canterbury were fully exercised. 
The proposed transactions are set out in the terms of a Note Conversion 
Agreement between Canterbury and Paragon. Given the conditions that remain to 
be satisfied, there can be no assurance that closing will occur. Following 
closing, Canterbury and Paragon will continue to be parties to a number of 
agreements, including an Advisory Agreement, whereby Canterbury provides advice 
to Paragon in return for a fee, and a Registration Rights Agreement. As well, 
Canterbury nominees will comprise the majority of Paragon's Board members. 
The Shares would, if acquired, be acquired from treasury. Canterbury would 
acquire and hold all of its Shares for investment purposes, and may acquire 
further Shares, or dispose of its holdings of Shares, both as investment 
conditions warrant. 
Canterbury is located at c/o Canterbury Park Management Inc., Suite 300, 1001 
Corydon Avenue, Winnipeg Manitoba, R3M 0B6. 
For further information: Bruce Warnock, Tel: (204) 954-5104, Fax: (204) 954-5185 
CO: Paragon Pharmacies Limited
ST: Manitoba
-0- Jul/31/2008 19:23 GMT
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