Mr. Gad Comments on Paragon's First Quarter Earnings Results, Citing Poor Financial Performance and Significant Waste of Stockholder Capital Under Current Unelected Directors - Seite 2

Company has stated it will likely incur over $3 million in legal costs in 6 months

In addition to results highlighted above, the "gain" of $450,000 on the sale of a fixed asset is principally due to the sale of one of our real estate assets, assets that were opportunistically acquired and which I have consistently expressed would be monetized for the benefit of the Company's stockholders. Under this Board, the assets are likely being monetized to pay for the legal fees incurred in the by the Board's self-serving entrenchment actions. In other words -assets are seemingly being liquidated to pay for costly entrenchment decisions, including illegal by law amendments and a poison pill, initiated by Weiser and perpetuated by Eriksen, Brownstein, and Lontini.

I have been sounding the alarm bells for months about the risks to the Company's financial strength and performance that the Weiser-led Board's conduct presented - and the risks are now becoming evident. The entrenchment actions implemented by these directors have exposed Paragon to a significant legal liability that has yet to be absorbed. And the biggest portion of that legal liability is almost certainly due to the poison pill that was passed by Eriksen, Brownstein, and Lontini and signed off by Weiser as the Company's earnings release indicated an expectation of $2 million more in legal spend during the second quarter

In December 2024, new directors were appointed by Weiser- who we now know was fabricating documents - and rather than address that concrete violation of fiduciary duty to the Company and its stockholders, Eriksen, Brownstein, and Lontini instead implemented a poison pill, claiming it served stockholder interests. In reality, the pill has done nothing but stifle open stockholder communication and expose the Company to further legal liability.

I have previously stated, I raised my concerns about Weiser's conduct with Eriksen in December. He and the other directors could have taken immediate action to look into Weiser, remove him from his position, and put an end to the self-serving entrenchment efforts. Had they done so, Paragon and its stockholders could have been spared from significant and unnecessary expenses.

Yet they chose not to intervene. Weiser's directors allowed him to remain in control, even as he fabricated internal records, undermined the confidence of key executives, and set the Board on a path toward adopting a poison pill designed to preserve his grip on power.