NewLead Holdings Ltd., a leading vertically integrated global shipping company specializing in the dry bulk and products tanker shipping industry, today reported its financial results for the fourth quarter and full year ended December 31, 2009. Michael S. Zolotas, President and Chief Executive Officer, stated,

“Since taking control of the Company four months ago, we have
revitalized and rebranded the operating activities of NewLead. As a
result of this and a renewed focus on technical management, NewLead has
improved operating efficiencies. The balance of 2010 will be focused on
continuing the transition to profitability by reconfiguring the fleet
mix to more appropriately reflect opportunity.”

RECENT DEVELOPMENTS

•???
Completed $400.0 million recapitalization.

•??? Deleveraged balance
sheet by converting $20.0 million of the 7% convertible senior notes
into equity and using vessel sale proceeds to repay debt.

•??? Agreed
to purchase two geared new-build Kamsarmax vessels, with long-term
charters. The vessels are projected to add approximately $16.1 million
in EBITDA annually and $104.0 million in aggregate EBITDA over the term
of the time charters.

•??? Exited the container market with the sale
of Saronikos Bridge and Seine.

•??? Agreed to sell non-productive
asset, Chinook, a Romanian product tanker. It is expected that the sale
will generate approximately $2.0 million in annual savings.

•???
Rebranded Company by adopting new trade name and commercial policies.

$400.0
Million Recapitalization

In October 2009, as part of the approximate
$400.0 recapitalization, the Company entered into a new $221.4 million
loan agreement refinancing its revolving credit facility with its
syndicate of lenders, and issued $145.0 million aggregate principal
amount of 7% convertible senior notes. NewLead also assumed a $37.4
million credit facility for the three vessels transferred to it in
exchange for approximately 18.98 million of newly issued common shares.?

In conjunction with the recapitalization, the Company underwent a
complete change in leadership, resulting in the reconstitution of the
Board of Directors and the appointment of new senior management.

Deleveraging
Activities

In November 2009, $20.0 million of the outstanding 7%
senior convertible notes were converted into 26.67 million common shares
at a conversion price of $0.75 per share. Following the conversion, the
remaining amount of outstanding 7% senior convertible notes is $125.0
million and such notes are convertible into approximately 166.67 million
common shares.

Furthermore, the sale of non-productive assets
generated aggregate proceeds of $21.5 million; a portion of these
proceeds was utilized to pay down debt.

Agreement to Purchase
New-build Vessels

In February 2010, the Company signed a Stock
Purchase Agreement providing for the purchase of two geared Kamsarmaxes
for an aggregate purchase price of $112.7 million. The Company will
acquire two geared, 80,000 DWT Kamsarmaxes from COSCO Dalian Shipyard
Co. Ltd. to be delivered in the fourth quarter of 2010 and 2011. The
charter for the first vessel is for a five-year initial term at $28,710
(net) per day. The charter for the second vessel is for a seven-year
term at $27,300 (net) per day. These time charters are projected to add
approximately $16.1 million in EBITDA annually and $104.0 million in
aggregate EBITDA.

Exited Container Market

In January 2010, the
Company completed the sale of the Seine and the Saronikos Bridge for
$13.0 million of gross cash proceeds. A portion of such proceeds were
used to pay down outstanding debt. The Saronikos Bridge and the Seine
were delivered to their new owners in January 2010. As a result of the
sale and delivery of these vessels, the Company exited the container
market.

Fleet Expansion and Technical Management

During the fourth
quarter of 2009, the Company entered into a non-binding Letter of
Intent to acquire Newlead Shipping S.A. and six vessels, consisting of
four dry bulk carriers and two product tankers, in a transaction valued
at approximately $180.0 million, of which approximately $20.0 million
will be paid through the issuance of common shares at a price no less
than $2.25 per share, a premium of over 156% from the recent closing
price of NewLead’s common shares. The balance of the purchase price will
be paid through the assumption of existing liabilities. The transaction
is subject to Board approval and consents from existing creditors. It
is anticipated the transaction will provide a meaningfully impact on
operating results by the end of the second quarter of 2010. ?

FINANCIAL
RESULTS

For the following results and the selected financial data
presented herein, NewLead has compiled consolidated statement of
operations for the three and twelve months ended December 31, 2009 and
2008 (including the predecessor business from January 1, 2009 to October
13, 2009 and successor business for the period from October 14, 2009 to
December 31, 2009). The information was derived from the unaudited
financial statements of the successor and predecessor business. The
successor period in the consolidated statement of operations is not
directly comparable to the predecessor period because it includes the
effects of fair value purchase accounting adjustments. Adjusted EBITDA
is a non-US GAAP financial measure and should not be used in isolation
or substitution for the predecessor and successor results. ?
Furthermore, with the exit from the container market and the addition of
three dry bulk vessels, the Company will focus its operations and
strategic initiatives on the tanker and dry bulk shipping markets. As a
result, the Company will report its operations in two operating
segments, the “Wet” and “Dry” which will include the results of
operations for the product tankers and dry bulk vessels, respectively.

Source:
NewLead Holdings Ltd.

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