NewLead Holdings Ltd. Closes Acquisition of Coal Excavation Rights
PIRAEUS, GREECE, April 15, 2013
PIRAEUS, GREECE, April 15, 2013 /PRNewswire/ --NewLead Holdings Ltd. (NASDAQ:
NEWL) ("NewLead") today announced that the Company has renegotiated previously
announced agreements to acquire title and coal excavation rights in 5,000
acres of land in Kentucky containing 18.6 million tons of estimated coal
reserves and ownership and leasehold interests in 18,335 acres of land in
Tennessee containing 143.1 million tons of estimated coal, natural gas and
other natural resource reserves. The agreements have also been modified to
permit NewLead to extract coal and collect royalties.
Under the amended agreements, NewLead is not required to now fund the $66
million aggregate acquisition price of the two properties. Instead, NewLead
must pay $850,000 per month through May 2013, which payments will be credited
against the $66 million aggregate acquisition price. At that time, the
remainder of approximately $40 million of the initial aggregate acquisition
price will become payable in nine monthly installments, with a payment of
approximately $23 million due a year after the last installment is due.
NewLead is currently seeking financing for the $66 million aggregate
acquisition price. While NewLead has signed a preliminary term sheet with a
lending party to enable it to fund this transaction, no assurance can be
provided that this or any other party will be able to provide the financing
required in the timeline required, or at all.
NewLead is also pleased to announce that it has hired coal mining executives
to lead its efforts in managing NewLead's commitment in the development of
mineral interests in the United States. These executives shall be responsible
for managing the daily operations of the coal mines and the excavation of coal
from the properties.
Michael Zolotas, Chairman and Chief Executive Officer of NewLead, stated, "We
continue to develop our commodity arm by hiring experienced professionals to
help exploit this opportunity. In addition, by amending the agreements to
allow NewLead to extract minerals from the coal mines, we are in a position to
leverage these assets and commence supplying coal to our growing customer
base. As previously announced, we have signed coal supply agreements expected
to generate $873.5 million of revenue over a three year period."
The estimated reserves stated above are as determined by independent
appraisals. The methodology used by the independent appraisers was not
compliant with the methodology required by the Securities and Exchange
Commission ("SEC") in reserve reports and, accordingly, should not be relied
upon. Such reserve information is only provided to give the best currently
available information. NewLead is undertaking to obtain reserve reports that
comply with SEC methodology. Such reports may differ materially from the
information provided herein.
About NewLead Holdings Ltd.
NewLead Holdings Ltd. is an international, vertically integrated shipping and
commodity company that manages product tankers and dry bulk vessels. NewLead
currently controls four vessels, two tankers and two dry bulk vessels.
NewLead's common shares are traded under the symbol "NEWL" on the NASDAQ
Global Select Market. To learn more about NewLead Holdings Ltd., please visit
the new website at http://www.newleadholdings.com/.
"Safe Harbor" Statement under the Private Securities Litigation Reform Act of
This press release includes assumptions, expectations, projections, intentions
and beliefs about future events. These statements, as well as words such as
"anticipate," "estimate," "project," "plan," and "expect," are intended to be
''forward-looking" statements. We caution that assumptions, expectations,
projections, intentions and beliefs about future events may vary from actual
results and the differences can be material. Forward-looking statements
include, but are not limited to, such matters as the creditworthiness of our
counterparties, the reliability of the reserve reports, our ability to extract
or acquire coal to fulfill contracts, future operating or financial results;
our liquidity position and cash flows, our ability to borrow additional
amounts under our revolving credit facility and, if needed, to obtain waivers
from our lenders and restructure our debt, and our ability to continue as a
going concern; statements about planned, pending or recent vessel disposals
and/or acquisitions, business strategy, future dividend payments and expected
capital spending or operating expenses, including dry-docking and insurance
costs; statements about trends in the product tanker and dry bulk vessel
shipping segments, including charter rates and factors affecting supply and
demand; expectations regarding the availability of vessel acquisitions;
completion of repairs; length of off-hire; availability of charters; and
anticipated developments with respect to any pending litigation. The
forward-looking statements in this press release are based upon various
assumptions, many of which are based, in turn, upon further assumptions,
including without limitation, management's examination of historical operating
trends, data contained in our records and other data available from third
parties. Although NewLead believes that these assumptions were reasonable when
made, because these assumptions are inherently subject to significant
uncertainties and contingencies which are difficult or impossible to predict
and are beyond our control, NewLead cannot assure you that it will achieve or
accomplish these expectations, beliefs or projections described in the forward
looking statements. Important factors that, in our view, could cause actual
results to differ materially from those discussed in the forward-looking
statements include the strength of world economies and currencies, general
market conditions, including changes in charter rates and vessel values,
failure of a seller to deliver one or more vessels, and other factors
discussed in NewLead's filings with the U.S. Securities and Exchange
Commission from time to time. NewLead expressly disclaims any obligations or
undertaking to release publicly any updates or revisions to any
forward-looking statements contained herein to reflect any change in NewLead's
expectations with respect thereto or any change in events, conditions or
circumstances on which any statement is based.
Cautionary Note to U.S. Investors
The United States Securities and Exchange Commission limits disclosure for
reporting purposes to mineral deposits that a company can economically and
legally extract or produce. We use certain terms on this press release, such
as "reserves," "resources," "geologic resources," "proven," or "probable,"
which may not be consistent with the reserve definitions established by the
SEC. U.S. Investors are cautioned not to assume that any part or all of
mineral deposits in these categories will ever be converted into SEC Industry
Guide 7 reserves. U.S. investors are urged to consider closely the disclosure
in our SEC filings to be filed in the future. You can review and obtain copies
of these filings from our website or at http://www.sec.gov/edgar.shtml.
Investor and Media Relations:
Telephone: + 30 213 014 8023
SOURCE NewLead Holdings Ltd.
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