Euroseas Ltd. Announces Commencement of Rights Offering

News Release Euroseas Ltd. May 25, 2012

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<DIV>05/25/12 - Maroussi, Athens,
Greece - Euroseas Ltd. (the "Company") (NASDAQ: ESEA), an owner and operator of
drybulk and container carrier vessels and provider of seaborne transportation
for drybulk and containerized cargoes, announced today that it has commenced its
previously announced rights offering to shareholders of the Company.
 Pursuant to the rights offering, the Company will offer approximately
13,852,094 shares of common stock (the "Offered Shares") only to holders of
record of its common stock (the "Record Date Holders") as of the close of
business on May 14, 2012 (the "Record Date"). As soon as practicable, the
Company will commence the mailing of an offering subscription package to Record
Date Holders. The Company intends to raise gross proceeds of
approximately $15.2 million through the rights offering and use the proceeds to
renew and expand its fleet, to participate in joint ventures with the objective
to acquire vessels and for general corporate purposes. The Offered
Shares will be sold to Record Date Holders pursuant to non-transferable
subscription rights. Basic subscription rights will be allocated in one
non-transferable subscription right for each 2.25 shares of common stock owned
by Record Date Holders on the Record Date. Each subscription right represents
the right to purchase one share of common stock of the Company at a subscription
price of $1.10 per share and consists of a basic subscription privilege and an
oversubscription privilege, which will be available if the rights offering is
not fully subscribed under the basic subscription privilege. Offered Shares not
purchased under the basic subscription privilege can be purchased pursuant to
the oversubscription privilege and will be allocated to Record Date Holders
choosing to exercise their oversubscription privilege. If there more requests
for oversubscription shares are received than shares are available, shares not
purchased under the basic subscription privilege will be allocated to Record
Date Holders exercising their oversubscription pro rata to each oversubscribing
holder based on the number of shares such holder purchased pursuant to the
exercise of its basic subscription privilege in proportion to the total number
of shares purchased by all oversubscribing holders pursuant to the exercise of
their basic subscription privileges. The offering will expire on June
15, 2012, unless extended by the Company. Should the rights offering be
extended, the Company will announce the extension as soon as practicable by
issuing a press release. Important Dates: Record Date May 14,
2012 Subscription period May 25 - June 15, 2012 Expiration date June 15,
2012(1) ________ (1) Shares will be issued as
soon as practicable following the expiration date. Conference
Call On Wednesday, May 30, 2012, at 10:00 a.m., EDT, the management of
Euroseas Ltd. will host a conference call to discuss the rights offering.
Participants should dial into the call 10 minutes before the scheduled time
using the following numbers: 1 (866) 819-7111 (from the US), 0(800) 953-0329
(from the UK) or +(44) (0) 1452 542 301 (from outside the US). Please quote
"Euroseas." A replay of the conference call will be available until June
15, 2012. The United States replay number is 1(866) 247-4222; from the UK 0(800)
953-1533; the standard international replay number is (+44) (0) 1452 550 000 and
the access code required for the replay is: 6973591#. The Company has
filed a registration statement (including a prospectus) on Form F-3 with the
Securities and Exchange Commission ("SEC") for the offering to which this
communication relates. The offering will be made only by means of the prospectus
dated February 17, 2012 set forth in the registration statement, as supplemented
by a prospectus supplement dated May 25, 2012. Copies of the registration
statement, prospectus and prospectus supplement may be obtained for free by
accessing the SEC's website at www.sec.gov or by calling Phoenix Advisory
Partners, the information agent for the rights offering, toll-free at (877)
478-5038. This press release shall not constitute an offer to sell or a
solicitation of an offer to buy, nor shall there be any sale of these securities
in any state or jurisdiction in which such an offer, solicitation or sale would
be unlawful prior to registration or qualification under the securities laws of
any such state or jurisdiction. </DIV></BODY></HTML>