FreeSeas to Close $8.5 Million Second and Final Tranche of Previously Announced $10 Million Investment

FreeSeas to Close $8.5 Million Second and Final Tranche of Previously
Announced $10 Million Investment

Athens, Greece, Dec. 30, 2013 (GLOBE NEWSWIRE) -- December 30, 2013 - FreeSeas
Inc. (Nasdaq  CM:  FREE)  ("FreeSeas"  or the  "Company"),  a  transporter  of 
dry-bulk cargoes  through  the ownership  and  operation  of a  fleet  of  six 
Handysize vessels  and  one Handymax  vessel,  announced today  that  it  will 
consummate the  second  and  final  tranche  of  the  $10  million  previously 
announced investment by Crede  CG III, Ltd.  (the "Investor"), a  wholly-owned 
subsidiary of  Crede  Capital  Group,  LLC, an  existing  shareholder  of  the 
Company.

Mr. Ion G. Varouxakis, Chairman, President and Chief Executive Officer of  the 
Company commented:  "We  are very  pleased  to close  this  transaction  which 
injects much needed  cash into  the Company.  The Company  shall now  be in  a 
financial position  to finance  the  dry-dockings of  its fleet  enabling  the 
return to operation of  the vessels at  a very opportune  time, as the  market 
recovery gathers pace. This injection shall also position the Company for  the 
acquisition of vessels that can immediately  produce income. We look into  the 
coming year with great expectations."

At the closing, the  Company will sell  to the Investor  85,000 shares of  the 
Company's Series  C  Convertible  Preferred Stock  (the  "Series  C  Preferred 
Stock") for $8.5 million. The shares of Series C Preferred Stock to be  issued 
will be convertible into shares of the Company's common stock at the lower  of 
(i) $2.00 and  (ii) the closing  bid price  of the Company's  common stock  on 
December 30,  2013,  and  such  conversion  price will  be  the  same  as  the 
conversion price  of  the  shares  of Series  B  Convertible  Preferred  Stock 
previously issued to the Investor on November 4, 2013.

The foregoing descriptions  of the transaction  and the transaction  documents 
are not  complete  and are  subject  to and  qualified  in their  entirety  by 
reference to the transaction documents, all of which are filed as exhibits to,
and more fully described in,  a Report of Foreign  Private Issuer on Form  6-K 
previously being filed with the SEC on November 4, 2013.

The securities to be sold and  issuable upon conversion thereof have not  been 
registered under  the Securities  Act of  1933, as  amended, (the  "Securities 
Act"), or any state securities laws, and unless so registered, the  securities 
may not  be  offered or  sold  in the  United  States except  pursuant  to  an 
effective registration statement or an exemption from, or in a transaction not
subject to, the registration requirements of the Securities Act and applicable
state securities laws. The shares of Series C Preferred Stock will be sold  to 
an accredited investor pursuant to Rule 506 promulgated under Regulation D  of 
the Securities Act. A registration statement for the resale of shares issuable
upon conversion of  the Series  C Preferred  Stock was  declared effective  on 
Friday December 27, 2013.

About FreeSeas Inc.

FreeSeas Inc.  is a  Marshall Islands  corporation with  principal offices  in 
Athens, Greece. FreeSeas is engaged  in the transportation of drybulk  cargoes 
through the ownership and operation of  drybulk carriers. Currently, it has  a 
fleet of Handysize and Handymax vessels. FreeSeas' common stock trades on  the 
Nasdaq Capital  Market under  the  symbol FREE.  Risks and  uncertainties  are 
described in  reports  filed by  FreeSeas  Inc. with  the  SEC, which  can  be 
obtained free of charge on the  SEC's website at http://www.sec.gov. For  more 
information  about  FreeSeas  Inc.,   please  visit  the  corporate   website, 
www.freeseas.gr.

Forward-Looking Statements

This press release contains forward-looking statements (as defined in  Section 
27A of  the  Securities Act  of  1933, as  amended,  and Section  21E  of  the 
Securities Exchange Act of 1934, as amended) concerning future events and  the 
Company's growth strategy and measures to implement such strategy. Words  such 
as  ''expects,''   ''intends,''  ''plans,''   ''believes,''   ''anticipates,'' 
''hopes,'' ''estimates,'' and variations of such words and similar expressions
are intended  to identify  forward-looking  statements. Although  the  Company 
believes that the  expectations reflected in  such forward-looking  statements 
are reasonable, no assurance can be given that such expectations will prove to
be correct. These  statements involve known  and unknown risks  and are  based 
upon a number of  assumptions and estimates, which  are inherently subject  to 
significant uncertainties  and contingencies,  many of  which are  beyond  the 
control of  the  Company. Actual  results  may differ  materially  from  those 
expressed or implied  by such forward-looking  statements. Factors that  could 
cause actual results  to differ materially  include, but are  not limited  to, 
changes in the demand for dry bulk vessels; competitive factors in the  market 
in which the Company  operates; risks associated  with operations outside  the 
United States; and  other factors listed  from time to  time in the  Company's 
filings with the  Securities and  Exchange Commission.  The Company  expressly 
disclaims any obligation  or undertaking  to release publicly  any updates  or 
revisions to any  forward-looking statements contained  herein to reflect  any 
change in the  Company's expectations with  respect thereto or  any change  in 
events, conditions or circumstances on which any statement is based.

Contact Information:

At the Company

FreeSeas Inc.

Dimitris Papadopoulos, Chief Financial Officer

011-30-210-45-28-770

Fax: 011-30-210-429-10-10

dp@freeseas.gr

www.freeseas.gr
 
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