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Lookout Below....MAJOR DILUTION Coming
Common Shares $0.01 par value, 1 billion shares authorized, 3.07 million and 0.0013 million shares issued and outstanding as of June 30, 2014 and December 31, 2013, respectively
6K More Bad News For SCAM NEWL
Total Liabilities UP
As of
June 30,2014...296,454,000.00
As of
December 31,2013...292,680,000.00
Major Dilution Coming
Common Shares $0.01 par value, 1 billion shares authorized, 3.07 million and 0.0013 million shares issued and outstanding as of June 30, 2014 and December 31, 2013, respectively
Major dilution Coming Again....1 billion shares authorized
Common Shares $0.01 par value, 1 billion shares authorized, 3.07 million and 0.0013 million shares issued and outstanding as of June 30, 2014 and December 31, 2013, respectively
BANKRUPTCY COMING-Substantial DOUBT about our Ability to Continue as a Going Concern
''As of December 31, 2013, our currents assets amounted to $12.4 million, while current liabilities amounted to $291.7 million, resulting in a negative working capital position of $279.3 million. Our independent registered public accounting firm has indicated in their report that there is substantial doubt about our ability to continue as a going concern''
NEWL ADMITS THEY MAY HAVE TO FILE BANKRUPTCY...........
''cause us to become bankrupt or insolvent''
''Our ability to comply with the covenants and restrictions contained in our existing and future debt agreements and other indebtedness may be affected by economic, financial and industry conditions and other factors beyond our control. If we are not able to come to a resolution with our lenders regarding our existing defaults or, if we are able to come to a successful resolution, but default on our future debt obligations, and such defaults are not waived by the required lenders, the applicable creditors may accelerate such indebtedness and, in the absence of any agreement with the lenders, if such indebtedness is secured, such creditors could proceed against the collateral securing that indebtedness. In any such case, we may be unable to borrow under our credit facility agreements, if any are available at such time, and may not be able to repay the outstanding amounts due under our credit facility agreements and our outstanding notes. Furthermore, if any of our debt is accelerated, all of our other indebtedness may be accelerated pursuant to cross-acceleration or cross-default provisions. This could have serious consequences to our financial condition and results of operations and could cause us to become bankrupt or insolvent. Our ability to comply with these covenants will also depend substantially on the value of our assets, our charter rates, our success at keeping our costs low and our ability to successfully implement our overall business strategy. Any future credit agreement or amendment or debt instrument may contain similar or more restrictive covenants.''
Smart Traders Would NEVER Buy a stock trading on the Greys. Smart traders would NEVER Buy & Hold a POS Like NEWL.A few Amateurs get attracted to this POS SCAM when it occasionally has a little run,then they don't sell right away and then find themselves Losing Money Fast. NEWL SCAM Has NEVER Been a Buy & Hold.
Now NEWL SCAM Trading on the Greys is A WORTHLESS POS Stock.
BK COMING SOON. Shareholders Will be WIPED OUT.
NEWL Is A PATHETIC POS Stock.
The ONLY Ones that EVER Made money on this Garbage,are the SMART Ones that ACTUALLY DID Their DD BEFORE They Bought,and were Then SMART Enough to not buy and hold.
NEWL Will File BK,Wiping out ALL Shareholders.
NEWL SCAM has clearly turned the corner,Yep Almost 0 now Trading on the Grey's. LOL
Down Another 17% Today.
Just read the SEC Filings,read up on the lawsuit,Then You Will Not be FOOLISH And Buy This POS.
As of December 31, 2013, our cash and cash equivalents were $2.3 million and current liabilities of $291.7 million were payable within the next twelve months.
The above conditions raise substantial doubt about our ability to continue as a going concern. The financial statements do not include any adjustments relating to the recoverability and classification of asset carrying amounts or the amount and classification of liabilities that might result should we are unable to continue as a going concern.
12 months is Almost here.Lookout Below!!!!
Bankruptcy WILL WIPE OUT SHAREHOLDERS.
NEWL Is Garbage,Like LOSING Money......Buy this POS SCAM
NEWL IS A PUMP and DUMP.
The ones that Actually Do REAL DD,Will NOT Be Foolish and buy NEWL.
Wrong Again,it Needs to go UP Over 10,000% From the First time you've said that.
NEWL SCAM Down 33% Today=BK Coming Soon
NEWL SCAM Will be SUB Penney Soon
Looks Like Bankruptcy is Coming SOON....Beware of this SCAM
''We have experienced net losses, negative operating cash flows, working capital deficiencies, negative operating cash flow and shareholders’ deficiency, which have affected, and which are expected to continue to affect, our ability to satisfy our obligations. In addition, as described in Item 5.-Operating and Financial Review and Prospects-Liquidity and Capital Resources, we are in default under various debt obligations which are currently due on demand. Charter rates for bulkers have experienced a high degree of volatility and continue to be distressed. To date, we have also been unable to generate sustainable positive cash flows from operating activities. For the year ended December 31, 2013, we have a loss from continuing operations in the amount of $146.8 million. As of December 31, 2013, our cash and cash equivalents were $2.3 million and current liabilities of $291.7 million were payable within the next twelve months.
The above conditions raise substantial doubt about our ability to continue as a going concern. The financial statements do not include any adjustments relating to the recoverability and classification of asset carrying amounts or the amount and classification of liabilities that might result should we are unable to continue as a going concern.
Our existence is dependent upon our ability to obtain necessary financing, which we are currently in the process of securing. We believe that our existing cash resources, combined with projected cash flows from operations, will not be sufficient to execute our business plan and continue operations for the next twelve months without additional funding. We intend to continue to explore various strategic alternatives, including the sale of equity or debt to raise additional capital. Management is also actively taking steps to increase future revenues and reduce our future operating expenses. However, wes cannot provide any assurance that operating results will generate sufficient cash flow to meet our working capital needs or that we will be able to raise additional capital as needed.
If all of our indebtedness was accelerated as a result of our current events of default, we may not have sufficient funds at the time of acceleration to repay our indebtedness and we may not be able to find additional or alternative financing to refinance any such accelerated obligations on terms acceptable to us or on any terms, which could have a material adverse effect on our ability to continue as a going concern.''
Looks Like Bankruptcy is Close....Beware of this SCAM
''We have experienced net losses, negative operating cash flows, working capital deficiencies, negative operating cash flow and shareholders’ deficiency, which have affected, and which are expected to continue to affect, our ability to satisfy our obligations. In addition, as described in Item 5.-Operating and Financial Review and Prospects-Liquidity and Capital Resources, we are in default under various debt obligations which are currently due on demand. Charter rates for bulkers have experienced a high degree of volatility and continue to be distressed. To date, we have also been unable to generate sustainable positive cash flows from operating activities. For the year ended December 31, 2013, we have a loss from continuing operations in the amount of $146.8 million. As of December 31, 2013, our cash and cash equivalents were $2.3 million and current liabilities of $291.7 million were payable within the next twelve months.
The above conditions raise substantial doubt about our ability to continue as a going concern. The financial statements do not include any adjustments relating to the recoverability and classification of asset carrying amounts or the amount and classification of liabilities that might result should we are unable to continue as a going concern.
Our existence is dependent upon our ability to obtain necessary financing, which we are currently in the process of securing. We believe that our existing cash resources, combined with projected cash flows from operations, will not be sufficient to execute our business plan and continue operations for the next twelve months without additional funding. We intend to continue to explore various strategic alternatives, including the sale of equity or debt to raise additional capital. Management is also actively taking steps to increase future revenues and reduce our future operating expenses. However, wes cannot provide any assurance that operating results will generate sufficient cash flow to meet our working capital needs or that we will be able to raise additional capital as needed.
If all of our indebtedness was accelerated as a result of our current events of default, we may not have sufficient funds at the time of acceleration to repay our indebtedness and we may not be able to find additional or alternative financing to refinance any such accelerated obligations on terms acceptable to us or on any terms, which could have a material adverse effect on our ability to continue as a going concern.''
NEWL Being Sued by TransAsia=NEWL Will LOSE
Just Look at All the FRAUD NEWL Committed
This action arises from a fraudulent scheme by the Defendants to inflate the share price
of Defendant NewLead Holdings, Ltd ("NewLead Holdings"), a company traded on the
NASDAQ stock exchange, in order to prevent that company from being de-listed. In order to
achieve that goal, the Defendants created a shell company, Defendant NewLead JMEG, LLC
("NewLead JMEG") and represented to the stock buying public that NewLead JMEG, a
subsidiary of NewLead Holdings, Ltd., was an active, viable and profit-making coal mining and
trading company. In fact, NewLead JMEG had no coal mines, no coal, and no ability
whatsoever to engage in the coal business. Nonetheless, between December 2012 and
August 2013, the Defendants caused NewLead JMEG to sign a series of multi-million dollar
contracts for the sale of coal, despite its inability to perform on those contracts. The contracts
were then touted by the Defendant NewLead Holdings in its public filings and press releases, in
f
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Case 1:13-cv-07895-JGK Document 1 Filed 11/06/13 Page 1 of 25
an effort to inflate the stock price of NewLead Holdings and prevent the de-listing of that
company by the NASDAQ exchange.
The Plaintiff, TransAsia Commodities, signed a contract with NewLead JMEG in June
2013 to purchase several hundred thousand tons of coal. In reliance on that contract, TransAsia
signed contracts with a third-party purchaser of the coal, and hired a ship to transport the coal.
The Plaintiff was severely damaged when the Defendants failed to deliver the coal, and now
finds itself with liability to the purchaser of the coal and the owners of the vessel it chartered to
transport the coal, an inability to attract the capital it needs to finance future coal deals, and
severe damage to its business reputation. By this action, TransAsia seeks to recover the damages
caused by the Defendants' breach of contract and fraud.
PARTIES
Plaintiff TransAsia Commodities Limited ("TransAsia") is a foreign corporation
with its principal place of business located in London, United Kingdom.
NewLead Holdings Ltd. ("NewLead Holdings" and, collectively with the other
corporate entities and individuals, "Defendants") is a Bermuda corporation with its principal
place of business located at 83 Akti Miaouli & Flessa Street, 185 38 Piraeus, Greece. NewLead
Holdings is listed on the NASDAQ Global Select Stock Market where it is traded under the
symbol NEWL. NewLead Holdings describes itself as "an international, vertically integrated
shipping company that manages product tankers and dry bulk vessels."
2.
NewLead JMEG, LLC ("NewLea 3. d JMEG") is a Delaware limited liability
. corporation with its principal place of business located at 4000 Faber Place Drive, North
Charleston, South Carolina. Upon information and belief, NewLead JMEG is a Joint Venture
between NewLead US and J Mining and Energy Group, LLC ("JMEG") established on April 11,
2012. On information and belief, JMEG was a Kentucky limited liability company established
on November 8, 2007 and dissolved on November 1, 2008. On information and belief, Jan
Berkowitz was the owner of JMEG. According to NewLead Holdings' public filings, NewLead
JMEG is a "joint venture affiliate" of NewLead Holdings.
2
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Case 1:13-cv-07895-JGK Document 1 Filed 11/06/13 Page 2 of 25
4. NewLead Holdings (US) Corp ("NewLead US") is a Delaware Corporation. On
information and belief, NewLead US is a wholly owned subsidiary of NewLead Holdings.
Jan Berkowitz ("Berkowitz") is a citizen of North Carolina, who on information
and belief, resides at 122 Alton Court, Mooresville, NC 28117. Berkowitz is the owner of
JMEG, and is the CEO and managing member of NewLead JMEG.
6. Michael Zolotas ("Zolatas") is a citizen of Greece. He is the Chairman, President,
and Chief Executive Officer of NewLead Holdings and has represented himself as the Chairman
of NewLead JMEG. Zolotas describes himself as "a third generation ship-owner [who] has over
18 years of experience in commercial, operational, and technical management in the shipping
industry."
JURISDICTION AND VENUE
This Court has jurisdiction of this matter pursuant to 28 U.S.C. § 1332(a) in that
the matter in controversy exceeds the sum or value of $75,000, exclusive of interest and costs,
and diversity of citizenship exists between plaintiff, a foreign corporation with its principal place
of business in the United Kingdom, and Defendants.
Jurisdiction and venue are also proper because pursuant to the operative
agreement upon which this litigation is based the parties have consented to the jurisdiction and
venue of this Court. Additionally, NewLead Holdings is currently and has at all relevant times
been traded on the NASDAQ Global Select Stock Market, which stock exchange is
headquartered in New York City, in this district. Additionally, and on information and belief,
individual defendants Zolotas and Berkowitz have frequently traveled to and conducted business
in this district. Moreover, NewLead Holdings has previously consented to jurisdiction in New
York City in other litigation matters.
8.
FACTS GIVING RISE TO A CAUSE OF ACTION
Trans Asia is a UK based company focused on trading commodities in niche
markets, including coal, crude oil and oil products, throughout the world. The company is also
involved in production, processing, transportation, and storage in a range of energy commodities.
()
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17582660.2
Case 1:13-cv-07895-JGK Document 1 Filed 11/06/13 Page 3 of 25
TransAsia is owned and operated by Serge Turko, a commodities trader with several decades of
experience in the commodities trading business.
NewLead Holdings is an international shipping company headquartered in
Beginning in 2009 and continuing through August 30, 2013, NewLead Holdings
embarked upon a reorganization of their shipping business, in the course of which they sold,
disposed of, or handed over control to their lenders a total of 20 vessels or hulls under
construction. As part of the reorganization, NewLead Holdings entered into the commodities
business in an effort to become a "vertically integrated shipping and commodity company." As
of the present time, upon information and belief, NewLead Holdings owns two dry bulk vessels.
Despite the reduction of approximately $460 million iii indebtedness through the restructuring,
as of August 30, 2013, NewLead Holdings' total indebtedness was approximately $124.8 million
10.
Greece.
In April 2012, NewLead Holdings, through its wholly-owned subsidiary
NewLead US, entered into a joint venture agreement with J Mining & Energy Group. J Mining
& Energy Group, although dissolved in 2008, was owned by Berkowitz. The joint venture
established NewLead JMEG for the purposes of purchasing and trading energy commodities,
principally coal.
11.
According to NewLead Holding's public filings, on December 20, 2012,
Berkowitz was "nominated, constituted and appointed with full power to execute and legally
bind [NewLead Holdings] in any and all contracts relating to coal mining and sales of coal in the
United States and to act on behalf of [NewLead Holdings] in the negotiation of deals related to
coal-bearing properties in the United States."
12.
On March 4, 2013, again as evidenced in the public filings of NewLead Holdings,
NewLead JMEG obtained a credit facility of up to $0.5 million with a financial institution
bearing an annual interest rate of 24%. On March 8, 2013, NewLead JMEG entered into an
agreement with a financial institution for a revolving credit facility of up to $1.35 million.
Borrowings under this facility also bear an interest rate of 24% per annum on the unpaid
principal balance.
13.
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Case 1:13-cv-07895-JGK Document 1 Filed 11/06/13 Page 4 of 25
In August 2012, shortly after NewLead JMEG was formed, NewLead Holdings
received written notification from the NASDAQ exchange that it was not in compliance with the
requirements for NASDAQ listed entities because the market value of NewLead Holdings'
publicly traded shares did not meet NASDAQ's minimum threshold.
14.
15. According to NewLead Holdings' public filings, in late 2012 and early 2013, its
joint venture affiliate NewLead JMEG entered into several large Sales Purchase Agreements
pursuant to which NewLead JMEG was to supply coal to third parties from mines it owned
and/or operated in Kentucky. According to subsequent filings by NewLead Holdings, virtually
all of these contracts for the sale of coal have since been terminated due to NewLead JMEG's
inability to perform by delivering coal to the purchasers.
16. By way of example, during January and February of 2013, it is claimed that
NewLead JMEG entered into three Sale Purchase agreements with two parties to supply over
$800 million of thermal coal to be mined in Kentucky. NewLead Holdings' public filings and
press releases repeatedly pointed to these and other large coal sale contracts as an indication that
NewLead Holdings was regaining financial strength.
17. In May and June, 2013, NewLead JMEG received notices of termination on the
contracts signed in January and February, 2013 due to ongoing defaults by NewLead JMEG
under the agreements. During 2012 and 2013, NewLead Holdings repeatedly informed potential
investors that NewLead JMEG had signed contracts to deliver hundreds of millions of dollars'
worth of coal. On information and belief, NewLead JMEG has defaulted on every contract it
signed for the sale and delivery of coal.
NewLead Holdings' public filings state that in December 2012, the company
entered into an agreement to purchase ownership and mineral rights to approximately 7,695 acres
of land in Kentucky and 18,335 acres in Tennessee - the purported source of the coal they were
selling. According to its subsequent public filings and news releases, NewLead Holdings has
been unsuccessful in efforts to obtain financing to satisfy payments under those agreements, and
"as a result, the transactions did not close on their intended closing dates, and as of August 30,
2013, have still not closed."
18.
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Case 1:13-cv-07895-JGK Document 1 Filed 11/06/13 Page 5 of 25
19. Following the announcements of the new coal Sales Purchase Agreements and the
supposed land deals, NewLead Holdings' stock price rebounded, and the company was informed
by NASDAQ in January 2013 that it had regained compliance with NASDAQ listing
requirements and would not be delisted, as had previously been threatened. In the following
months, the company repeatedly sought and obtained amendments of the sales agreements for
the purchase of the Kentucky and Tennessee properties, extending the dates for the closing on
those properties multiple times due to the company's inability to obtain the financing necessary
to proceed to closing. Upon information and belief, as of the present date, NewLead Holdings is
in default of its obligations under those agreements.
20. On September 13, 2012, NewLead Holdings received another written notification
from NASDAQ indicating they were not in compliance with NASDAQ Listing Rule
5450(b)(3)(C) for continued listing on the NASDAQ Global Select Market because the market
value of the Company's publicly held shares was below $15 million for the previous 30
consecutive business days. On that same date, they were also informed in writing that they were
not in compliance with NASDAQ Listing Rule 5450 (a)(1) because the minimum bid price of
their common shares was below $1.00 per share for the previous 30 consecutive business days.
NewLead Holdings was then granted a 180 day compliance period to regain compliance with the
NASDAQ Listing Rules, and on January 24, 2013, they were notified that they had regained
compliance with the minimum bid price requirement because the closing bid price of their
common shares had exceeded $1.00 for ten consecutive business days.
Then, on April 4, 2013, NewLead Holdings was informed once again by
NASDAQ that the minimum bid price of the company's shares was below the $1.00 minimum
bid requirement and were granted a 180 day compliance period ending on October 1, 2013. In a
press release dated October 4, 2013, NewLead Holdings announced that it had failed to meet the
minimum $1.00 per share bid price for a ten day period, and had been notified that it had not
regained compliance. The company's stock will therefore be delisted unless the company
requests a hearing on or before October 9, 2013. According to a NewLead Holdings press
release, the company expects to regain compliance through a 1-to -15 reverse split of its common
shares that is scheduled to occur on or before October 17, 2013. As of October 15, 2013, the
common stock of NewLead Holdings was trading at nine cents per share.
21.
. 6
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Case 1:13-cv-07895-JGK Document 1 Filed 11/06/13 Page 6 of 25
TransAsia enters into a Coal Purchase Agreement with NewLead JMEG
In the spring of 2013, contemporaneously with NewLead Holdings' renewed
difficulties in qualifying for continued listing on NASDAQ, Berkowitz, acting on behalf of
NewLead JMEG, met with Tom Zabrodsky, an experienced commodities trader and independent
contractor who was working for TransAsia in the United States, regarding a potential deal for the
sale of coal. At that time, Berkowitz represented to Zabrodsky that he worked for a company
called "New Coal Holdings".
22.
23. In the Spring of 2013, TransAsia was becoming active in the purchase and resale
of coal to be sold to buyers in Asia and South America. At that time there was strong demand for
high-sulfur coal from certain Indian companies, and TransAsia was looking for coal to sell to the
Indian customers.
24. In order to learn more about NewLead and Berkowitz, in May, 2013, Zabrodsky,
acting on behalf of Trans Asia, flew to Charlotte, North Carolina, to meet with Berkowitz.
25. During that meeting, Berkowitz told Zabrodsky that NewLead JMEG and /or his
other company, "New Coal Holdings", owned coal mines and a "wash plant" (a facility that
cleans coal), all of which were located in Kentucky. Berkowitz represented to Zabrodsky that
NewLead JMEG owned the coal being offered for sale, and assured him that NewLead JMEG
was not a coal broker. TransAsia was an attractive target for NewLead JMEG because TransAsia
had access to credit facilities and to customers who were ready and able to sign contracts for the
delivery of large amounts of coal, both of which could be used to leverage the stock price of
NewLead Holdings.
TransAsia had relationships with potential customers for coal throughout the
world, as well as access to trade finance banks capable of providing letters of credits and other
financial securities necessary to secure a sale.
26.
27. Berkowitz and Zabrodsky initially discussed two potential long term coal deals
amounting to approximately $220 million. Berkowitz also raised the possibility of obtaining
financing from TransAsia by means of advance payments utilizing these two "offlake" contracts
7
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Case 1:13-cv-07895-JGK Document 1 Filed 11/06/13 Page 7 of 25
as security. Berkowitz stated that this would help NewLead acquire additional assets and ensure
TransAsia would have secure supply sources.
The first potential coal deal was with a Brazilian company that was seeking to
acquire "washed" coal of the type allegedly produced by NewLead JMEG's Kentucky mines and
"wash plant".
28.
29. As part of the Brazilians' due diligence in connection with the potential purchase
of washed coal from NewLead JMEG, they sent a team to the United States in order to meet
Berkowitz and visit the wash facility and coal mines purportedly owned by NewLead JMEG, and
from which the coal was supposed to be produced.
30. Berkowitz took the Brazilians to the wash plant in Kentucky, but their visit to the
facility was limited by Berkowitz to 15 minutes. Berkowitz never took the due diligence team to
"his" mine, supposedly because it was "too far" for the group to visit that day. Berkowitz also
refused to complete a mandatory environmental questionnaire that the Brazilians required their
coal suppliers to complete. These failures caused the Brazilians to abandon the potential deal.
At the same time they were working on the washed coal opportunity for the
Brazilians, Berkowitz and TransAsia began discussions regarding a separate deal for high sulfur
coal to be exported to a cement company in India.
31.
32. High sulfur coal mined in the United States is used by Indian cement companies
as an alternative to scarce and increasingly expensive petroleum coke. TransAsia knew that an
Indian company, Shree Cement, was interested in purchasing such coal.
33. After learning of this opportunity, Berkowitz represented to TransAsia that he
could supply high sulfur coal from NewLead JMEG's coal mines in Kentucky for shipment to
Shree Cement in India. The coal would be transported by NewLead JMEG from Kentucky down
the Mississippi River, where it would meet a vessel chartered by TransAsia that would be
waiting in New Orleans. From there, it would be shipped to India.
34. On June 14, 2013 in reliance upon representations made by Berkowitz regarding
his ability to deliver coal, TransAsia entered into a Coal Sales Agreement ("CSA") with Shree
17582660.2
Case 1:13-cv-07895-JGK Document 1 Filed 11/06/13 Page 8 of 25
Cement ("Shree"), a manufacturer of cement and cement products located in Kolkata, India. The
CSA is attached hereto, incorporated herein and marked as Exhibit "A". Pursuant to the terms of
the CSA, TransAsia agreed to sell and deliver 110,000 metric tons of coal to Shree. TransAsia
and Shree agreed that if the first transaction was successful, Shree would continue to purchase
coal from TransAsia on a monthly basis for a period of twelve months.
In order to satisfy its obligations to Shree under the CSA, TransAsia in turn
entered into a Coal Purchase Agreement ("CPA") with NewLead JMEG on June 21, 2013. The
CPA is attached hereto, incorporated herein and marked as Exhibit "B".
35.
36. The CPA provides that NewLead JMEG will provide TransAsia with an initial
shipment of 110,000 Metric Tons of coal in July 2013 and contemplates an extended deal at
buyer's option through July 2014 for additional coal. Coal was to be delivered to TransAsia
FOB the vessel at New Orleans. See CPA % 3.0.
In order to induce TransAsia to enter into the CPA, Berkowitz repeatedly
informed TransAsia that NewLead JMEG owned the coal in question, and that it was prepared to
deliver it FOB New Orleans. For example, on June 10, 2013, in response to questions from
Serge Turko ("Turko"), the owner of TransAsia, Berkowitz represented in writing that he owned
the coal, that he controlled the shipping of the coal from the mine to the load out station, and that
once loaded on barges it would take 14 days to reach New Orleans. As for scheduling the
delivery, he wrote "let me know when you want the product at this time ... WE are the expeditor.
37.
..." Asked who would liaise with vessel agents to arrange shipping documents, etc., Berkowitz
In order to induce replied "my shipping department". TransAsia to enter into the CPA,
Berkowitz repeatedly assured TransAsia that he was an experienced coal trader, and that he
owned the coal and the "outloading station" where the barges would be loaded, and that he had
the ability to perform under the CPA. Every one of these representations was false and known
by Berkowitz to be false when made, and were made with the intent to induce TransAsia to enter
into the CPA.
38. As a further inducement to TransAsia to enter into the CPA, and as proof that it
owned the subject coal, Berkowitz provided several analysis reports prepared by a company
called "SGS North America, Inc." On information and belief, SGS is a universally recognized
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Case 1:13-cv-07895-JGK Document 1 Filed 11/06/13 Page 9 of 25
independent assayer of coal, and their analyses of coal quality are utilized by the coal industry all
over the world.
39. The "SGS Reports" provided by Berkowitz purported to show the quality of the
coal that Berkowitz had represented he owned, including, inter alia, the percentages of nitrogen,
sulfur, oxygen and moisture in the coal that was tested. Two such SGS reports, dated March 18,
2013 and May 24, 2013, were addressed to "NewLead JMEG, LLC" and "J Mining & Energy
Group, Inc." The SGS reports were provided by Berkowitz to TransAsia prior to execution of the
CPA, and purported to show the specifications of the coal NewLead JMEG was selling to
TransAsia.
Unknown to TransAsia, both of the SGS Reports identified above had been
doctored and were forgeries, created by Berkowitz and/or Zolotas using SGS letterhead without
the company's knowledge or permission in order to induce TransAsia to enter into the CPA. On
information and belief, SGS did not issue these reports, and did not give permission to NewLead
JMEG, Berkowitz, or anyone else to do so.
40.
Following the execution of the CPA, Berkowitz provided TransAsia with several
additional SGS Reports that he represented were authentic. On information and belief, almost all
of the SGS Reports provided to TransAsia by Berkowitz were forgeries.
41.
TransAsia Fulfills its Contractual Obligations Under the Coal Purchase Agreement
42. In order to fulfill its contract with Shree to transport coal from the United States
to India, TransAsia needed to charter a specific type of vessel, known in the shipping industry as
a "Baby Cape", a type of ship that is large enough to carry 115,000 metric tons of coal from New
Orleans to India. The voyage to India from New Orleans takes approximately 42 days, and the
freight costs are substantial. In order to locate and reserve, or "fix" such a vessel, a 45 day
window is needed. It is therefore imperative for the party responsible for making shipment to
take great care to have the cargo at the port ready to begin loading on the day that the vessel
arrives. Large sums of money depend on getting the logistics of the delivery process right, so
that the coal is mined, shipped, and arrives at the loading port at the same time as the transport
vessel, which is often traveling from another continent to meet its cargo.
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Case 1:13-cv-07895-JGK Document 1 Filed 11/06/13 Page 10 of 25
43. In accordance with the CPA, and in reliance on the representations of Berkowitz
on behalf of NewLead JMEG, on July 9, 2013, TransAsia located a vessel, the "UBC Ottawa"
(the "Ottawa") and signed a contract, known as a "Charter Party", for the Ottawa on July 17,
2013. At that time the Ottawa was en route to Germany to discharge its onboard cargo, and
would steam to New Orleans, pick up the coal to be delivered by NewLead JMEG, and transport
the coal to India. The cost of this voyage was set at $34.50 per metric ton, which meant that the
cost of the voyage was $3,915,750 plus additional costs in the event the vessel was delayed, and
the cost for any delays was set at a daily rate of $19,300 on a pro-rata basis. A Copy of the
Charter Party is attached as Exhibit "C."
44. Throughout the duration of its journey across the Atlantic Ocean, the Ottawa's
operators provided regular email updates regarding its position. NewLead JMEG, Berkowitz and
Zolotas were copied on all these emails. At no time did NewLead JMEG, Berkowitz or Zolotas
indicate to TransAsia or the Ottawa that it would be unable to provide the coal it had contracted
to supply under the terms of the CPA upon the arrival of the Ottawa in New Orleans. To the
contrary, Berkowitz and Zolotas assured TransAsia on an ongoing basis that the coal was in New
Orleans and that they would be ready to load the coal upon the Ottawa's arrival.
Although payment for the coal was to be made following delivery, the CPA
required TransAsia's bank to issue to NewLead JMEG a Letter of Credit as a form of payment
security for 110% of the shipment's value within 30 days of the "layperiod" (the date on which
the ship arrives in port and is ready to be loaded). See CPA "Billing and Payment" provision.
45.
On information and belief, TransAsia's ability to provide a Letter of Credit from
a reputable bank made it an attractive target for NewLead JMEG et al., as a Letter of Credit
could potentially be utilized by NewLead Holdings and the other defendants as collateral for the
credit they desperately needed. In accord with its contractual duties, on or about July 19th, 2013,
TransAsia's bank, NBAD Private Bank (Suisse) SA., issued a Letter of Credit that was advised
through NewLead JMEG's bank in Geneva, Switzerland - BNP Paribas (Suisse) SA. NewLead
JMEG was informed by BNP Paribas of its receipt of this Letter of Credit.
46.
47. Ten days after TransAsia had presented NewLead JMEG with a "Documentary
Letter of Credit" issued by its bank, NBAD Private Bank (Suisse) SA., Zolotas first became
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involved in the transaction. Specifically, Zolotas contacted Serge Turko, who was Trans Asia's
owner, and asked him to provide a "Stand by Letter of Credit" in lieu of the Documentary Letter
of Credit that had been provided by TransAsia. It is now clear that Zolotas wanted a Stand By
Letter of Credit because that type of instrument can be used as collateral to obtain funds, whereas
a Documentary Letter of Credit cannot. Turko did not agree to provide a Stand By Letter of
Credit as NewLead JMEG, Berkowitz and Zolotas would be capable of drawing down funds
under the Stand by Letter of Credit without actually delivering the coal.
NewLead Misrepresents its Ability to Fulfill the CPA
48. In the weeks that followed the execution of the CPA, TransAsia sought to obtain
more information regarding the coal it was buying from NewLead JMEG, Berkowitz, and
Zolotas. During this period, NewLead JMEG, Berkowitz, and Zolotas misrepresented the status
of the coal on multiple occasions in order to mislead TransAsia. For example, in an email dated
July 29, 2013, Berkowitz falsely assured TransAsia that a contract was in place between
NewLead JMEG and the Ingram Barging Company to transport the coal to New Orleans from
the load out station, that he had stockpiles of coal at the load out station that was ready to ship,
and that different coal grades would be blended in order to meet the specifications for coal "per
our contractual terms."
49. The CSA and CPA both set forth "laydays" of July 19-29, 2013 in New Orleans.
The laydays are the specific time period during which an ocean-going vessel must arrive and be
available for loading. The laydays are critical because once a vessel is compelled to sit and wait
for loading outside of that time window, the chartering company- TransAsia - is required to pay
"demurrage" ~ the cost of the vessel sitting empty in port — at a cost of almost $20,000 per day
to be paid to the vessel operator.
NewLead JMEG was aware that in order to fulfill its contractual obligations
under the CPA, it needed to obtain, ship and deliver its coal to the port of New Orleans (referred
to as "NOLA" in the contract) within that time period. After the CPA was signed, Berkowitz
repeatedly assured TransAsia he had arranged for shipment and delivery of the coal in order to
meet NewLead JMEG's delivery obligations.
50.
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51. Due to delays in locating an appropriate vessel able to sail to New Orleans within
the original layperiod, the parties were forced to amend both the CPA and CSA to modify the
layperiod and avoid demurrage. The amended CPA is attached hereto, incorporated herein and
marked as Exhibit "D"; the amended CSA is attached hereto, incorporated herein and marked as
Exhibit "E."
The amended agreements specified a layperiod of August 25-September 5, 2013.
Pursuant to the CPA, NewLead JMEG had two days to notify TransAsia that the layperiod was
CPA f 2(a). NewLead JMEG did not provide that notice, and the parties
proceeded in accordance with the August 25-September 5 layperiod for loading the coal onto the
ocean-going ship.
52.
not acceptable.
53. During the time that TransAsia was seeking an appropriate vessel to transport the
coal, representatives of the Indian purchaser, Shree, traveled to the United States to conduct due
diligence in connection with the CSA. Zabrodsky traveled with the Shree delegation to
Lexington, Kentucky. Shree had requested to see the mines and the wash plant allegedly owned
by NewLead JMEG.
On or about July 24, Turko met personally with Berkowitz in Norfolk, Virginia.
Berkowitz assured Turko that all arrangements were in place and Shree would be visiting the
mine, wash plant and the load out facilities which Berkowitz had represented that NewLead
JMEG owned. Berkowitz also indicated that Shree would "see with their own eyes and would be
able to touch the coal that was to load on the vessel Ottawa". The coal which Shree did in fact
see and touch during their visit, and the load out facilities did not belong to Berkowitz or
On information and belief, the load out terminal belong to an individual
54.
NewLead JMEG.
named Dan Taylor.
The group first visited the wash plant which Berkowitz had repeatedly
represented was owned by New Coal Holdings, an affiliate of NewLead JMEG and NewLead
Holdings. The wash plant was not operating, but Shree and Zabrodsky visited the facility and
observed industrial equipment that they were informed belonged to New Coal Holdings.
55.
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56. The group also visited a coal load out station on the Kanawha Canal, in
Kentucky. Berkowitz's representative, a person named Rick Thacker, also told the Shree
representatives and Zabrodsky that Berkowitz owned the load out station, which is called
"Riverway". This information was subsequently determined to be false.
57. According to the CPA, the coal was to be brought from the mine to the load out
station, where it would be loaded onto barges. The barges would move the coal to the Ohio
River and eventually the Mississippi River from where it could be barged to New Orleans to be
loaded onto the TransAsia vessel. It would take 10 days to load the barges and it takes
approximately 14 days for the barges to reach New Orleans from the Riverway load out station.
58. While at the load out station, Thacker pointed to piles of large coal chunks on the
ground that he claimed belonged to Berkowitz, and told Zabrodsky that NewLead JMEG had
100,000 tons of similar "large coal". The Shree group was impressed with the large coal that
Berkowitz showed them. Zabrodsky later learned that the large coal had been purchased by
Berkowitz from another coal supply company.
59. Thacker did not take Zabrodsky or the Shree group to the Kentucky mine that
day because it was supposedly "too far."
60. The coal was to be loaded onto the vessel for transport to India through a process
called "midstreaming". Midstreaming is an alternative process for loading coal onto an oceangoing
vessel whereby the ocean-going vessel is not docked at a land-based terminal. Rather, a
series of barges is used to transport the coal to the vessel which sits floating in the Mississippi
river. When a coal shipper uses a traditional land-based loading technique, the shipper does not
need to be as concerned with barge demurrage because the coal is often loaded right onto the
ocean vessel upon its arrival at the terminal. Midstream loading, however, requires that careful
attention be paid to coordinating the shipment of barges with the arrival of the vessel. Ideally, all
of the loaded barges should be fleeted at the midstream loading site and ready to load on the first
day of the vessel's laydays.
61. As the supplier, NewLead JMEG was required to engage a contractor to handle
the midstreaming and a barging company to deliver the coal. NewLead JMEG represented to
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TransAsia that it had engaged Ingram Barge Company ("Ingram") to handle the barging, and
that it had contracted with Associated Terminals to perform the midstreaming operation. It was
subsequently discovered that neither Ingram nor Associated Terminals ever signed contracts with
NewLead JMEG, Berkowitz, Zolotas, or any of their affiliated companies.
On or around August 4, 2013 Berkowitz provided TransAsia with "barging
schedules," which are documents that show schedule for the movement of coal from the load out
station all the way to New Orleans. On many occasions both Berkowitz and Zolotas knowingly
and falsely indicated the barging was in place. However, TransAsia later learned that the barging
schedules provided by Berkowitz were never implemented.
62.
63. The schedule provided by Berkowitz to TransAsia acknowledges that it would
take 6-8 days to load the barges at the load out station and 10-18 days for the total coal order to
be barged to New Orleans. Although the schedule was never implemented, the timeframe set
forth in the fabricated barging schedules was commercially reasonable, and consistent with
TransAsia's expectations.
64. Based on the schedule provided to TransAsia, NewLead would need to commence
barging coal from the Riverway load out station no later than 18-21 days before the end of the
layperiod.
65. Rather than inform TransAsia that it would be unable to satisfy its obligations
under the CPA, New Lead, Berkowitz and Zolotas repeatedly represented to TransAsia that the
coal was at The Riverway load out facility and both the barging and midstreaming arrangements
in New Orleans were in place. During this period, TransAsia was assured on a daily basis by
Zolotas and Berkowitz that the contract was on schedule. Later, Zolotas informed TransAsia that
the coal was being purchased from a 3 rd party and was not coming from NewLead owned mines.
66. At all times, Zolotas and Berkowitz reassured TransAsia that the coal would be
delivered as per the CPA. Virtually every one of the dozens of representations made by
Berkowitz and Zolotas regarding their ability and intent to deliver the coal during this period
were false and known to be false by Zolatas and Berkowitz.
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NewLead Demands Prepayment and Fails to Deliver the Coal
Finally, on or around August 24, 2013, 2 days prior to Ottawa's arrival in New
Orleans, Zolotas emailed TransAsia, stating that there was an "issue", because the coal supplier
had "changed gears at the last minute." Zolotas told TransAsia that in order to receive the coal,
they needed to amend the financial terms of the transaction, and sought a $1,000,000 prepayment
from TransAsia in order to pay their "supplier" for the shipment.
67.
This news stunned TransAsia, who had previously been informed on multiple
occasions that the coal they were buying belonged to NewLead JMEG, not some unnamed
"supplier". TransAsia refused to make this prepayment as there was no assurance the coal in fact
existed.
68.
69. In the days that followed Zolotas and Berkowitz both kept up the deception. For
example, on August 24, 2013 Zolotas told TransAsia that "the coal is located in Nola and barge
have been informed." Zolotas repeatedly assured Turko that he was being "transparent" and
"straight forward" in his dealings with TransAsia. All of these statements were false and known
to be false by Zolotas when made.
In an email to Turko dated August 24, 2013, Zolotas stated that he was the
"chairman" and that Berkowitz was the "CEO" of NewLead JMEG.
70.
Although Turko demanded additional information to support and justify the
prepayment, none was provided. In the meantime, the Ottawa continued on its journey to New
Orleans.
71.
72. The Ottawa arrived in New Orleans on or around August 26, 2013. TransAsia
provided NewLead JMEG with the requisite notice of its arrival in accordance with the CPA.
See CPA |2(b).
73. No coal was delivered to New Orleans by NewLead JMEG
74. Despite this, Turko was repeatedly assured by Zolotas that the "coal is there for
you and your clients." Then, TransAsia was informed that the coal had been transported to New
Orleans under the name of the unidentified "supplier" rather than from the NewLead JMEG
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owned coal mine. Zolotas now said that all that was needed was for TransAsia to make the
$1,000,000 prepayment.
Desperately seeking to find a solution, TransAsia demanded information
regarding the coal supplier and the suppliers' capabilities. Again, Zolotas stalled, promising to
"manage and resolve it" and repeatedly assured TransAsia that the "coal is in No la." (i.e.. New
Orleans).
75.
Berkowitz provided similar assurances, which Berkowitz knew to be false,
promising to send TransAsia the SGS composite analysis done for coal that he claimed was in
New Orleans and ready to be loaded.
76.
On or around August 27, 2013, TransAsia requested the letter of credit issued by
TransAsia to NewLead JMEG to be cancelled by NewLead. TransAsia received notice a few
days later that the Letter of Credit was cancelled. Zolotas acknowledged that NewLead JMEG
had not performed pursuant to the CPA, and promised TransAsia that "even if you have losses
we will cover your losses. We stand on our principals."
77.
78. In numerous subsequent written and oral communications to Turko and Trans-
Asia, Zolotas acknowledged that NewLead JMEG had breached the CPA.
79. On August 28, 2013, Zolotas wrote to Turko that "I respect the fact that you have
losses" and promising that when "the dust settles we will arrange for your remuneration."
80. Upon learning of NewLead JMEG's breach of the CPA, TransAsia sought to
arrange an alternate source of coal for Shree Cement, but was unable to find a grade acceptable
to the company, and Shree was compelled to procure alternate cargo from a separate supplier.
81. On September 1, 2013, TransAsia requested written confirmation from NewLead
JMEG that no coal would be available for loading onto the Ottawa. TransAsia needed to inform
the vessel owners to provide them with the opportunity to find alternate cargo before the
layperiod closed on September 5.
Finally, on September 4, 2013, Zolotas provided TransAsia with "official notice"
that "NewLead JMEG will not be able to load the vessel MY UBC Ottawa due to logistic
82.
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issues." Again, NewLead JMEG, Zolotas and Berkowitz failed to disclose the truth to
TransAsia, stating logistics was the issue, when in fact NewLead JMEG did not have the coal.
Ingram has confirmed to TransAsia that they were ready to ship the coal and the barges were
available but NewLead JMEG never brought any coal for them to ship down the river.
83. Upon receipt of this notice of breach, TransAsia informed the vessel owner and
released the vessel. The Ottawa sat on demurrage in New Orleans for at least 20 days until the
vessel owner was able to find an alternative cargo. The daily rate for demurrage was established
at $19,300 per day.
84. The CPA requires that demurrage be paid by the seller. CPA 3(b); 4(a).
NewLead's Fraudulent Misrepresentations
85. Both prior to and following execution of the CPA, Zolotas and Berkowitz, on
behalf of the NewLead entities, consistently and systematically misrepresented their capacity to
deliver the coal specified in the CPA. These misrepresentations include but are not limited to:
(a) Claiming to own one or more coal mines in Kentucky;
(b) Claiming to own a wash plant in Kentucky;
(c) Claiming ownership of the barge load out facility and related equipment
on the Kanawha canal;
(d) Stating that they had entered into a barging contract with Ingram.
(e) Stating that they owned the coal seen during the site inspection.
(f) Providing barging schedules which Zolotas, Berkowitz and NewLead had
no intention to put in place.
(g) Providing forged SGS Reports to TransAsia.
86. As a result of the defendants' fraud and their breach of the CPA, TransAsia has
and will continue to incur substantial direct and consequential damages.
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TransAsia has been damaged by its reliance on the intentional, material, and
fraudulent misrepresentations made by Zolotas and Berkowitz in their individual capacities, and
on behalf of NewLead JMEG and NewLead Holdings. These damages include but are not
limited to direct damages that TransAsia will be required to pay to Shree Cement for its nonperformance
of the CSA, damages that will be owed to the owners of the Ottawa, and
TransAsia's costs of financing the Letter of Credit.
87.
88. In addition, TransAsia has and will sustain consequential damages due to the
defendants' fraudulent conduct, including but not limited to lost profits, an inability to obtain the
required capital to conduct its business, credit facilities and/or obtaining credit terms at more
disadvantageous rates, and loss of its business reputation.
89. The aforementioned false statements and forged documents were made with the
intent to induce and did so induce TransAsia to enter into the CPA and to prevent TransAsia
from discovering the Defendants' fraud both before and after the CPA was executed.
90. The aforementioned false statements and forged documents were made with the
intent to cause and did so cause TransAsia to provide financial support to the Defendants; to
enable the Defendants to borrow against the TransAsia Letter of Credit; and in order to enable
defendants to tout the CPA, which NewLead Holdings intended to use as proof of its financial
viability, in its public filings, in order to induce investors to buy its stock - and by doing so
prevent NewLead Holdings from being delisted by NASDAQ and to cause financial gain to
NewLead Holdings, Zolotas and Berkowitz by using what was a shell company (New Lead
JMEG) to perpetrate a fraud upon TransAsia.
COUNT I - BREACH OF CONTRACT AGAINST NEWLEAD JMEG
91. TransAsia hereby repeats, realleges, and incorporates by reference and makes a
part hereof the allegations in the preceding paragraphs, as if set forth herein at length.
92. TransAsia and NewLead JMEG entered into a contract on June 21, 2013.
93. 1 ransAsia has performed all of its obligations under the CPA.
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94. NewLead JMEG breached the CPA by failing to sell and deliver coal as set forth
in Section 1.0 of the CPA.
95. Defendants have admitted their breach of the CPA.
As a result of defendant's breach of the CPA, TransAsia has been damaged,
including but not limited to, incurring substantial losses from its inability to perform on the CSA
and payment of demurrage fees to the owners of the Ottawa.
96.
97. Based on the foregoing, TransAsia is entitled to direct and consequential damages
in an amount to be determined through discovery, but believed to be no less than $2,978,560.
98. Pursuant to section 4(a) of the CPA, TransAsia is entitled to recover all losses
incurred due to defendant's breaches.
COUNT II - COMMON LAW FRAUD AND FRAUDULENT INDUCEMENT AGAINST
ALL DEFENDANTS
99. TransAsia hereby repeats, realleges, and incorporates by reference and makes a
part hereof the allegations in the preceding paragraphs, as if set forth herein at length.
Prior to the parties' entry into the CPA, Defendants NewLead JMEG and
NewLead Holdings either directly or through their designated officers and agents Berkowitz
and/or Zolotas deliberately made multiple material misrepresentations, including, inter alia;
100.
their ownership (a) of coal for sale to TransAsia;
(b) their ownership of coal mines in Kentucky and Tennessee;
(c) their ownership of a coal wash facility located in Kentucky;
(d) their ownership of a loading station for the transport of coal;
(e) the availability and sourcing of coal to be provided under the CPA.
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Case 1:13-cv-07895-JGK Document 1 Filed 11/06/13 Page 20 of 25
101. Subsequent to the parties entry into the CPA, Defendants NewLead JMEG and
NewLead Holdings either directly or through their designated agents Berkowitz and/or Zolotas
deliberately misrepresented, inter alia;
(a) their ability to perform under the CPA;
(b) that they had shipped coal to New Orleans;
(c) provided false barging schedules;
(d) provided false SGS analyses for coal that they falsely claimed they owned;
(e) falsely claimed that they had a supplier of coal that would enable them to
fulfill the CPA;
(f) made multiple intentionally false statements intended to prevent TransAsia
from discovering their fraud.
102. All of the foregoing material misstatements, misrepresentations, and/or omissions
were known by Defendants to have been false when made, were made by Defendants
deliberately and with an intent to deceive TransAsia, and to deprive TransAsia of the benefit of
the CPA.
Defendants intended that TransAsia would justifiably rely on each such
misrepresentation and omission.
103.
104. TransAsia reasonably relied to its detriment upon Defendants' misrepresentations
and omissions.
105. As the result of said reliance, TransAsia has incurred and will incur direct and
consequential damages in an amount to be determined.
106. The fraudulent and tortious conduct of the Defendants evinced a high degree of
moral turpitude and wanton dishonesty.
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The Defendants' fraud was aimed at the public generally, as the goal was to
fraudulently inflate the share price of NewLead Holdings.
107.
108. The Defendants' conduct just6ifies the award of consequential and punitive
damages.
COUNT III - CIVIL CONSPIRACY AGAINST ZOLOTAS AND BERKOWITZ
109. TransAsia hereby repeats, realleges and incorporates by reference and makes a
part hereof the allegations in the preceding paragraphs, as if set forth herein at length.
110. Zolotas and Berkowitz had an agreement to create NewLead JMEG and to utilize
it as a sham company in order to inflate the share price of NewLead Holdings by defrauding
customers such as TransAsia.
In order to frirther this fraudulent scheme, Zolotas and Berkowitz both
intentionally misrepresented material facts and induced plaintiff to enter into the CPA.
111.
As a result of the aforementioned misrepresentations and the conspiracy,
TransAsia has suffered damages and injury in an amount to be determined.
112.
COUNT IV - ALTER EGO
113. TransAsia hereby repeats, realleges, and incorporates by reference and makes a
part hereof the allegations in the preceding paragraphs, as if set forth herein at length.
114. Upon information and belief, Berkowitz is the sole managing agent of NewLead
JMEG. Berkowitz and Zolotas have represented Berkowitz to be the CEO of NewLead JMEG,
and he was acting in that capacity when he entered into the CPA on NewLead JMEG's behalf.
Upon information and belief, NewLead Holdings 115. US is the sole member of
NewLead JMEG.
Upon information and belief, NewLead Holdings US is a wholly owned
subsidiary of NewLead Mojave Holdings LLC.
116.
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117. Upon information and belief, NewLead Holdings is the sole member of NewLead
Mojave Holdings LLC.
118. The operation of NewLead JMEG, NewLead Holdings US, and NewLead Mojave
Holding LLC is contingent on and intertwined with the operations of NewLead Holdings such
that there is commonality of financial and strategic resources, directors and officers and, at all
relevant times, NewLead Holdings used the assets of these entities for its own purpose.
119. Upon information and belief, none of these entities was adequately capitalized
apart from, perhaps, NewLead Holdings. NewLead JMEG was created by NewLead Holdings,
Zolotas, and Berkowitz for the express purpose of fraudulently signing contracts for the sale of
coal it never intended or was capable of delivering. This was done for the express purpose of
inflating the stock price of NewLead Holdings. NewLead JMEG was a sham corporation,
created solely as a means of perpetrating a fraud. It had no assets against which its creditors
could recover. The fraudulent scheme was perpetrated to allow NewLead Holdings, Zolotas, and
Berkowitz to benefit and then utilize the corporate form to frustrate relief against NewLead
JMEG, a sham company.
120. Upon information and belief, NewLead Holdings, Zolotas, and Berkowitz
regularly move cash and other assets between NewLead Holdings and its subsidiaries in order to
satisfy listing requirement with the NASDAQ through artificially inflating share prices for
NewLead Holdings and to avoid creditors.
Berkowitz is the alter ego of NewLead JMEG, NewLead Holdings, and its
Berkowitz exercises complete domination and control over
NewLead JMEG. Berkowitz used NewLead JMEG, which had been dissolved in November
2008, as a fraudulent shell company to induce TransAsia to enter into the CPA.
121.
subsidiaries and/or vice versa.
Zolotas is the alter ego of NewLead JMEG, NewLead Holdings and its
subsidiaries and/or vice versa. Zolotas is the CEO and exercises complete domination and
control over NewLead Holdings and its subsidiaries, and, without limitation, complete
domination and control with respect to the negotiations with TransAsia and the CPA.
122.
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Case 1:13-cv-07895-JGK Document 1 Filed 11/06/13 Page 23 of 25
123. Zolotas and Berkowitz, both individually and as the alter egos of NewLead JMEG
and NewLead Holdings, fraudulently induced TransAsia to enter into and perform the CPA by
intentionally misrepresenting and knowingly omitting material facts for the purpose of inducing
TransAsia to enter into the CPA.
124. TransAsia reasonably relied on such representations and omissions in entering
into and performing the CPA, and which misrepresentations caused Trans Asia's damages
herein.
125. For the foregoing reasons, the interests of justice require that this Court disregard
the corporate form of NewLead JMEG and enter judgment against NewLead Holdings, Michael
Zolotas and Jan Berkowitz, jointly and severally.
WHEREFORE, plaintiff respectfully demands as follows;
Judgment upon the complaint against NewLead JMEG, NewLead Holdings,
Michael Zolotas, and Jan Berkowitz.
2. Damages pursuant to the CPA;
Compensatory damages;
4 Consequential damages;
Punitive damages;
6. Rescission of the CPA and a finding that the CPA was void ab initio.
Attorney's fees as authorized by law;
8. Trial by Jury on all issues so triable;
A constructive trust of defendants NewLead JMEG, NewLead Holdings, Zolotas
and Berkowitz's assets for the benefit of Plaintiff;
(J
10. And any and all other relief to which Plaintiff may be entitled
''The court ruled in Ironridge's favor on every issue''
It's Obvious They WILL LOSE In Arbitration Too.
It would be Foolish to think otherwise.
Ironridge Global IV, Ltd. Successfully Prevails in NewLead Holdings Ltd. TRO
By
Published: June 11, 2014 5:24 p.m. ET
HEADLINE2Ironridge receives clean bill of health from United States District Court, and wins complete dissolution of Temporary Restraining Order, after being given opportunity to respond to frivolous accusations made by NewLead
NEW YORK, June 11, 2014 /PRNewswire/ -- Ironridge Global IV, Ltd., an institutional investor in micro-cap public companies, today announced that Ironridge fully prevailed on the Temporary Restraining Order (TRO) and Petition for Preliminary Injunctive Relief Pending Arbitration brought by NewLead Holdings Ltd. (NEWL). After Ironridge was given an opportunity to respond at a hearing, the U.S. District Court ruled completely in favor of Ironridge, dissolved the TRO, and denied NewLead's request for a preliminary injunction. The court ruled in Ironridge's favor on every issue, stating in relevant part as follows:
"Ironridge has submitted account statements for all its sales of NewLead shares, which show no short sales and account for all shares it has received. And Ironridge showed that NewLead miscalculated when it found that Ironridge exceeded the 10% cap on April 16-its only evidence of short selling. There is no evidence Ironridge has ever made a short sale of NewLead stock."
"The parties dispute whether one of the measures of the daily trading limit is assessed by dollar volume or number of shares. NewLead's CFO acknowledged that 'the difference between calculating the trading limits on a dollar value as opposed to a share number basis is de minimis.' Five de minimis breaches cannot give rise to a claim for material breach permitting NewLead to terminate the share subscription agreement."
"NewLead's CFO conceded Ironridge could not be responsible for any decline in NewLead's stock price. NewLead's share price has declined precipitously over a period of years. Ironridge had nothing to do with any of those declines."
"And Ironridge is responsible for only a small portion of NewLead's share dilution."
On May 9, 2014, Ironridge initiated arbitration proceedings against NewLead before JAMS International, for NewLead's multiple material defaults under $27.5 million in Series A Preference Shares issued to Ironridge on March 4, 2014, for which Ironridge fully paid $25.0 million in cash and notes. NewLead failed to honor conversions and pay dividends and embedded dividend liability due on the Preference Shares.
On June 3, 2014, NewLead filed in the United States District Court, Southern District of New York a Petition for Temporary Restraining Order and Injunction In Aid of International Arbitration Proceedings to prevent the conversion of any Preference Shares of NewLead into NewLead's common shares pursuant to conversion of its outstanding Preference Shares solely held by Ironridge as well as the issuing of any of the Company's common shares to Ironridge. In an improper attempt to justify its own breaches, NewLead falsely alleged that Ironridge violated limited technical provisions of the agreement.
At a fully evidentially hearing on June 9, 2014, Ironridge proved that NewLead's allegations that Ironridge breached its contractual obligations – which were based entirely on rank speculation without a shred of evidence – were all demonstrably false. Ironridge submitted indisputable trading records conclusively proving that Ironridge has never engaged in short selling, market manipulation or selling above agreed volume limits.
Ironridge will continue to fully live up to all of its obligations under the agreement.
Ironridge was represented by the law firm of Skadden, Arps, Slate, Meagher & Flom LLP.
Mineral Exploration.Coal Business May FAIL,IF It EVER Starts.
''Currently, our coal business operations are limited or non-existent. There can be no assurance that we will be able to effectively manage our limited operations or expand operations in the future.''
''Because our management team has no experience in mineral exploration and does not have formal training specific to the technicalities of mineral exploration, there is a risk that our coal business may fail.
The members of our management team have no experience operating a mining company and do not have formal training as geologists, engineers or in the technical aspects of management of a mining company. As a result, our management’s decisions and choices may not take into account standard engineering or managerial approaches that mining companies commonly use. In addition, we will have to rely on the technical services of others with expertise in mining in order for us to exploit our properties. If we are unable to contract for the services of such individuals, it will make it difficult and maybe impossible to pursue our business plan. Consequently, our operations, earnings and ultimate financial success could suffer irreparable harm due to management’s lack of experience in this industry.''
'' During 2012, we entered into a variety of transactions in order to develop a commodities sector of our business. We have entered into a joint venture arrangement and we have established a new entity with J Mining & Energy Group for the purchase and trading of coal. As of May 8, 2014, these coal operations have not yet developed.''
THIS IS 4TH 1/4 2014,WHERES THE REVENUE?????
''Expected Acquisition of Five Mile Mine
As previously announced, NewLead has entered into a separate agreement for the acquisition of title and coal excavation rights for the Five Mile mine located in Kentucky, USA with 7,695 mineral acres. The Company has received a reserve report compliant with the U.S. Securities and Exchange Commission ("SEC") methodology for the mine acquisition which states that the mine contains eight million tons in actual proven coal reserves.
The Company estimates that the mine will begin generating revenue in Q4 2013. The Company estimates that the acquisition will be concluded in Q4 of 2013, but the acquisition is subject to a number of terms and conditions and there is no assurance it will be consummated.''
NEWL ALREADY LOST in Court Against Ironridge.
It is now supposedly in arbitration.NEWL Will LOSE in Arbritration too.
''The court ruled in Ironridge's favor on every issue''
Ironridge Global IV, Ltd., an institutional investor in micro-cap public companies, announced that Ironridge fully prevailed on the Temporary Restraining Order (TRO) and Petition for Preliminary Injunctive Relief Pending Arbitration brought by NewLead Holdings Ltd. (Nasdaq: NEWL). After Ironridge was given an opportunity to respond at a hearing, the U.S. District Court ruled completely in favor of Ironridge, dissolved the TRO, and denied NewLead's request for a preliminary injunction. The court ruled in Ironridge's favor on every issue, stating in relevant part as follows:
"Ironridge has submitted account statements for all its sales of NewLead shares, which show no short sales and account for all shares it has received. And Ironridge showed that NewLead miscalculated when it found that Ironridge exceeded the 10% cap on April 16-its only evidence of short selling. There is no evidence Ironridge has ever made a short sale of NewLead stock."
"The parties dispute whether one of the measures of the daily trading limit is assessed by dollar volume or number of shares. NewLead's CFO acknowledged that 'the difference between calculating the trading limits on a dollar value as opposed to a share number basis is de minimis.' Five de minimis breaches cannot give rise to a claim for material breach permitting NewLead to terminate the share subscription agreement."
"NewLead's CFO conceded Ironridge could not be responsible for any decline in NewLead's stock price. NewLead's share price has declined precipitously over a period of years. Ironridge had nothing to do with any of those declines."
"And Ironridge is responsible for only a small portion of NewLead's share dilution."
On May 9, 2014, Ironridge initiated arbitration proceedings against NewLead before JAMS International, for NewLead's multiple material defaults under $27.5 million in Series A Preference Shares issued to Ironridge on March 4, 2014, for which Ironridge fully paid $25.0 million in cash and notes. NewLead failed to honor conversions and pay dividends and embedded dividend liability due on the Preference Shares.
On June 3, 2014, NewLead filed in the United States District Court, Southern District of New York a Petition for Temporary Restraining Order and Injunction In Aid of International Arbitration Proceedings to prevent the conversion of any Preference Shares of NewLead into NewLead's common shares pursuant to conversion of its outstanding Preference Shares solely held by Ironridge as well as the issuing of any of the Company's common shares to Ironridge. In an improper attempt to justify its own breaches, NewLead falsely alleged that Ironridge violated limited technical provisions of the agreement.
At a fully evidentially hearing on June 9, 2014, Ironridge proved that NewLead's allegations that Ironridge breached its contractual obligations – which were based entirely on rank speculation without a shred of evidence – were all demonstrably false. Ironridge submitted indisputable trading records conclusively proving that Ironridge has never engaged in short selling, market manipulation or selling above agreed volume limits.
Ironridge will continue to fully live up to all of its obligations under the agreement.
Ironridge was represented by the law firm of Skadden, Arps, Slate, Meagher & Flom LLP.
Everybody that's bought and held this SCAM Has Huge Losses.
NEWL Is a SCAM. Read and UNDERSTAND The TRUTH by Doing Real DD,BEFORE YOU BUY.
Not much effort needed to see the SCAM For what it is.
NEWL Is Garbage,Like LOSING Money......Buy this POS SCAM
If you bought this in July,you now need Over a 4000% Gain Just to Break Even.
NEWL IS A PUMP and DUMP.
The ones that Actually Do REAL DD,Will NOT Be Foolish and buy NEWL.
NEWL Is A PATHETIC POS Stock.
The ONLY Ones that EVER Made money on this Garbage,are the SMART Ones that ACTUALLY DID Their DD BEFORE They Bought,and were Then SMART Enough to not buy and hold.
NEWL Is a PUMP And DUMP SCAM Trading on the Lowest of Lows Exchanges AKA The Greys
There Is NOTHING POSITIVE About this POS Stock.
If you bought and held this Garbage this summer,you now need OVER 4000% Just to Break Even.
NEWL Will File BK,Wiping out ALL Shareholders.
Don't be FOOLISH And Buy a SCAM Like NEWL.
It's Beyond Foolish to Buy a Stock Trading on the Greys where you trade in the Dark.
This company is DOOMED.
Read the latest SEC Report and Look at ALL The NEGATIVES.
Read up on the Lawsuit from TransAsia.
NEWL SCAM Has DROPPED 99% of EVERY Trading Day it Traded in the Past 5 Years.
THERE ARE NO POSTIVES FOR THIS SCAM,If there were IT WOULD NOT BE TRADING @ LESS Than .03.
Bankruptcy will WIPE OUT ALL SHAREHOLDERS.
ALL NEWL News Is BAD News Anyhow,just look at the HUGE Drop since the Supposed good news of the ships being delivered.It needs to go UP Over 2000% Just to get back where it was BEFORE That Good News was released.LMAO
Those that Actually Do Their DD BEFORE They Buy this POS Would know,There is NO Good News for SCAM NEWL.
WRONG,People that Actually do Real DD Know NEWL Is a SCAM.
People are suppose to do their DD BEFORE They buy,not after.LOL
''Very interesting that here it is, almost 12 complete months later! I don't know why they were buying ships with debt like that...
We know they are no closer to selling or even producing any coal since they announced their mine and coal wash plans!''
You are Right,People that Have Done REAL DD,Know That.
NEWL Will Be BANKRUPT SOON.
''December 31, 2013, our currents assets amounted to $12.4 million, while current liabilities amounted to $291.7 million, resulting in a negative working capital position of $279.3 million. Our independent registered public accounting firm has indicated in their report that there is substantial doubt about our ability to continue as a going concern''
''We have experienced net losses, negative operating cash flows, working capital deficiencies, negative operating cash flow and shareholders’ deficiency, which have affected, and which are expected to continue to affect, our ability to satisfy our obligations. In addition, as described in Item 5.-Operating and Financial Review and Prospects-Liquidity and Capital Resources, we are in default under various debt obligations which are currently due on demand. Charter rates for bulkers have experienced a high degree of volatility and continue to be distressed. To date, we have also been unable to generate sustainable positive cash flows from operating activities. For the year ended December 31, 2013, we have a loss from continuing operations in the amount of $146.8 million. As of December 31, 2013, our cash and cash equivalents were $2.3 million and current liabilities of $291.7 million were payable within the next twelve months.
The above conditions raise substantial doubt about our ability to continue as a going concern. The financial statements do not include any adjustments relating to the recoverability and classification of asset carrying amounts or the amount and classification of liabilities that might result should we are unable to continue as a going concern.
Our existence is dependent upon our ability to obtain necessary financing, which we are currently in the process of securing. We believe that our existing cash resources, combined with projected cash flows from operations, will not be sufficient to execute our business plan and continue operations for the next twelve months without additional funding. We intend to continue to explore various strategic alternatives, including the sale of equity or debt to raise additional capital. Management is also actively taking steps to increase future revenues and reduce our future operating expenses. However, wes cannot provide any assurance that operating results will generate sufficient cash flow to meet our working capital needs or that we will be able to raise additional capital as needed.
If all of our indebtedness was accelerated as a result of our current events of default, we may not have sufficient funds at the time of acceleration to repay our indebtedness and we may not be able to find additional or alternative financing to refinance any such accelerated obligations on terms acceptable to us or on any terms, which could have a material adverse effect on our ability to continue as a going concern.''
NEWL Going Concern WARNING=NOT Looking Good for This SCAM
''“A going concern” opinion is one of the biggest red flags an auditor or accountant can wave in the plain view of investors after reviewing the books. A company’s accountants must warn investors if they think the company is in strong danger of failing, liquidating or running into serious troubles that threaten its ability to remain in the same corporate form. Just because a company is deemed a going concern does not mean it will fail — but accountants see the odds being high enough that it’s their responsibility to warn investors as part of disclosing the annual audit or annual report.
Fortunately for investors, the number of “going concern” opinions has been dropping since the financial crisis was at its worst in 2008. There have been a total of just 2,205 going concern auditor opinions issued for fiscal 2013 as of July 4 among all companies, which is down 12.9% from fiscal 2012, Audit Analytics says. And last year’s count of “going concerns” is down 34% from the high-water mark of this decade, 2008, when there were 3,354 going concern opinions given.''
''It's getting tougher for a company to pull out of trouble once the auditor expresses doubt in an audit opinion about whether the company can remain in business, according to the latest data on going-concern qualifications.
In its analysis of more than a decade of going concern filings, Audit Analytics found only 140 companies filed a clean audit opinion in 2012 after getting a red flag from auditors the year before. It's the first time the number dipped below 200 since 2000. In the two prior years, the number fell from 277 to 207 before hitting its low of 140 in 2011.
Based on more than 90 percent of filings submitted so far in 2013, Audit Analytics is predicting 2,517 companies will ultimately carrying the going concern qualification on their audit opinions when all 2012 financial statements are filed. That's 127 fewer companies than the 2644 reported in 2011, and the fourth consecutive year the number fell from a high of 3,352 in 2008.
Although the number of going concern filings fell for the fourth straight year, it doesn't necessarily mean company performance has improved, according to the research firm analysis. A certain number of companies will naturally fall off the list because they won't recover from whatever downfall led to the going concern qualification and therefore won't file financial statements in the subsequent year, the firm says. Based on its analysis of prior year data, Audit Analytics says 228 companies will drop out of capital markets for that reason, yet the decline is only 127.
The research data also shows that going concern qualifications have been handed out to a higher percentage of companies in the past six years than in the six years prior to the ramp up to the financial crisis. From 2000 to 2006, the percentage of companies that drew the going concern warning ranged from 14.1 percent in 2006 to a high of 17.4 percent in 2006. Then the climb began in 2007 when the percentage rose to 19.9 percent, peaked in 2008 at 21.1 percent, and tapered to 17.7 percent in 2011 and 17.5 percent in 2012.''
''We have experienced net losses, negative operating cash flows, working capital deficiencies, negative operating cash flow and shareholders’ deficiency, which have affected, and which are expected to continue to affect, our ability to satisfy our obligations. In addition, as described in Item 5.-Operating and Financial Review and Prospects-Liquidity and Capital Resources, we are in default under various debt obligations which are currently due on demand. Charter rates for bulkers have experienced a high degree of volatility and continue to be distressed. To date, we have also been unable to generate sustainable positive cash flows from operating activities. For the year ended December 31, 2013, we have a loss from continuing operations in the amount of $146.8 million. As of December 31, 2013, our cash and cash equivalents were $2.3 million and current liabilities of $291.7 million were payable within the next twelve months.
The above conditions raise substantial doubt about our ability to continue as a going concern. The financial statements do not include any adjustments relating to the recoverability and classification of asset carrying amounts or the amount and classification of liabilities that might result should we are unable to continue as a going concern.
NEWL Down on Higher Volume=BANKRUPTCY COMING
New 52 week LOW AGAIN On Higher Volume
NEWL SCAM IS DOOMED.......SUB Penney Coming Soon!
''We have experienced net losses, negative operating cash flows, working capital deficiencies, negative operating cash flow and shareholders’ deficiency, which have affected, and which are expected to continue to affect, our ability to satisfy our obligations. In addition, as described in Item 5.-Operating and Financial Review and Prospects-Liquidity and Capital Resources, we are in default under various debt obligations which are currently due on demand. Charter rates for bulkers have experienced a high degree of volatility and continue to be distressed. To date, we have also been unable to generate sustainable positive cash flows from operating activities. For the year ended December 31, 2013, we have a loss from continuing operations in the amount of $146.8 million. As of December 31, 2013, our cash and cash equivalents were $2.3 million and current liabilities of $291.7 million were payable within the next twelve months.
The above conditions raise substantial doubt about our ability to continue as a going concern. The financial statements do not include any adjustments relating to the recoverability and classification of asset carrying amounts or the amount and classification of liabilities that might result should we are unable to continue as a going concern.
NEWL-New 52 Week Low. This PUMP & DUMP IS DOOMED.
''As of December 31, 2013, our currents assets amounted to $12.4 million, while current liabilities amounted to $291.7 million, resulting in a negative working capital position of $279.3 million. Our independent registered public accounting firm has indicated in their report that there is substantial doubt about our ability to continue as a going concern''
''We have experienced net losses, negative operating cash flows, working capital deficiencies, negative operating cash flow and shareholders’ deficiency, which have affected, and which are expected to continue to affect, our ability to satisfy our obligations. In addition, as described in Item 5.-Operating and Financial Review and Prospects-Liquidity and Capital Resources, we are in default under various debt obligations which are currently due on demand. Charter rates for bulkers have experienced a high degree of volatility and continue to be distressed. To date, we have also been unable to generate sustainable positive cash flows from operating activities. For the year ended December 31, 2013, we have a loss from continuing operations in the amount of $146.8 million. As of December 31, 2013, our cash and cash equivalents were $2.3 million and current liabilities of $291.7 million were payable within the next twelve months.
The above conditions raise substantial doubt about our ability to continue as a going concern. The financial statements do not include any adjustments relating to the recoverability and classification of asset carrying amounts or the amount and classification of liabilities that might result should we are unable to continue as a going concern.
Our existence is dependent upon our ability to obtain necessary financing, which we are currently in the process of securing. We believe that our existing cash resources, combined with projected cash flows from operations, will not be sufficient to execute our business plan and continue operations for the next twelve months without additional funding. We intend to continue to explore various strategic alternatives, including the sale of equity or debt to raise additional capital. Management is also actively taking steps to increase future revenues and reduce our future operating expenses. However, wes cannot provide any assurance that operating results will generate sufficient cash flow to meet our working capital needs or that we will be able to raise additional capital as needed.
If all of our indebtedness was accelerated as a result of our current events of default, we may not have sufficient funds at the time of acceleration to repay our indebtedness and we may not be able to find additional or alternative financing to refinance any such accelerated obligations on terms acceptable to us or on any terms, which could have a material adverse effect on our ability to continue as a going concern.''
Don't be FOOLISH And Buy a SCAM Like NEWL.
It's Beyond Foolish to Buy a Stock Trading on the Greys where you trade in the Dark.
This company is DOOMED.
Read the latest SEC Report and Look at ALL The NEGATIVES.
Read up on the Lawsuit from TransAsia.
NEWL SCAM Has DROPPED 99% of EVERY Trading Day it Traded in the Past 5 Years.
THERE ARE NO POSTIVES FOR THIS SCAM,If there were IT WOULD NOT BE TRADING @ LESS Than .03.
Bankruptcy will WIPE OUT ALL SHAREHOLDERS.
Mineral Exploration.Coal Business May FAIL,IF It EVER Starts.
''Currently, our coal business operations are limited or non-existent. There can be no assurance that we will be able to effectively manage our limited operations or expand operations in the future.''
''Because our management team has no experience in mineral exploration and does not have formal training specific to the technicalities of mineral exploration, there is a risk that our coal business may fail.
The members of our management team have no experience operating a mining company and do not have formal training as geologists, engineers or in the technical aspects of management of a mining company. As a result, our management’s decisions and choices may not take into account standard engineering or managerial approaches that mining companies commonly use. In addition, we will have to rely on the technical services of others with expertise in mining in order for us to exploit our properties. If we are unable to contract for the services of such individuals, it will make it difficult and maybe impossible to pursue our business plan. Consequently, our operations, earnings and ultimate financial success could suffer irreparable harm due to management’s lack of experience in this industry.''
'' During 2012, we entered into a variety of transactions in order to develop a commodities sector of our business. We have entered into a joint venture arrangement and we have established a new entity with J Mining & Energy Group for the purchase and trading of coal. As of May 8, 2014, these coal operations have not yet developed.''
THIS IS 4TH 1/4 2014,WHERES THE REVENUE?????
''Expected Acquisition of Five Mile Mine
As previously announced, NewLead has entered into a separate agreement for the acquisition of title and coal excavation rights for the Five Mile mine located in Kentucky, USA with 7,695 mineral acres. The Company has received a reserve report compliant with the U.S. Securities and Exchange Commission ("SEC") methodology for the mine acquisition which states that the mine contains eight million tons in actual proven coal reserves.
The Company estimates that the mine will begin generating revenue in Q4 2013. The Company estimates that the acquisition will be concluded in Q4 of 2013, but the acquisition is subject to a number of terms and conditions and there is no assurance it will be consummated.''
NEWL Will Be BANKRUPT SOON.
December 31, 2013, our currents assets amounted to $12.4 million, while current liabilities amounted to $291.7 million, resulting in a negative working capital position of $279.3 million. Our independent registered public accounting firm has indicated in their report that there is substantial doubt about our ability to continue as a going concern''
''We have experienced net losses, negative operating cash flows, working capital deficiencies, negative operating cash flow and shareholders’ deficiency, which have affected, and which are expected to continue to affect, our ability to satisfy our obligations. In addition, as described in Item 5.-Operating and Financial Review and Prospects-Liquidity and Capital Resources, we are in default under various debt obligations which are currently due on demand. Charter rates for bulkers have experienced a high degree of volatility and continue to be distressed. To date, we have also been unable to generate sustainable positive cash flows from operating activities. For the year ended December 31, 2013, we have a loss from continuing operations in the amount of $146.8 million. As of December 31, 2013, our cash and cash equivalents were $2.3 million and current liabilities of $291.7 million were payable within the next twelve months.
The above conditions raise substantial doubt about our ability to continue as a going concern. The financial statements do not include any adjustments relating to the recoverability and classification of asset carrying amounts or the amount and classification of liabilities that might result should we are unable to continue as a going concern.
Our existence is dependent upon our ability to obtain necessary financing, which we are currently in the process of securing. We believe that our existing cash resources, combined with projected cash flows from operations, will not be sufficient to execute our business plan and continue operations for the next twelve months without additional funding. We intend to continue to explore various strategic alternatives, including the sale of equity or debt to raise additional capital. Management is also actively taking steps to increase future revenues and reduce our future operating expenses. However, wes cannot provide any assurance that operating results will generate sufficient cash flow to meet our working capital needs or that we will be able to raise additional capital as needed.
If all of our indebtedness was accelerated as a result of our current events of default, we may not have sufficient funds at the time of acceleration to repay our indebtedness and we may not be able to find additional or alternative financing to refinance any such accelerated obligations on terms acceptable to us or on any terms, which could have a material adverse effect on our ability to continue as a going concern.''
NEWL Is A PATHETIC POS Stock.
The ONLY Ones that EVER Made money on this Garbage,are the SMART Ones that ACTUALLY DID Their DD BEFORE They Bought,and were Then SMART Enough to not buy and hold.
NEWL Will File BK,Wiping out ALL Shareholders.
NO Manipulation,just the smarter traders taking their losses and dumping this SCAM.
NEWL IS A SCAM
Smart Traders Would NEVER Buy a stock trading on the Greys. Smart traders would NEVER Buy & Hold a POS Like NEWL.A few Amateurs get attracted to this POS SCAM when it occasionally has a little run,then they don't sell right away and then find themselves Losing Money Fast. NEWL SCAM Has NEVER Been a Buy & Hold.
If you bought this SCAM in July,you Now Need OVER A 4000% Gain Just to Break Even.
Now NEWL SCAM Trading on the Greys is A WORTHLESS POS Stock.
BK COMING SOON. Shareholders Will be WIPED OUT.
''Based on latest financial disclosure NewLead Holdings Limited has Probability Of Bankruptcy of 94%. This is 142.84% higher than that of the Services sector, and 104.65% higher than that of Shipping industry, The Probability Of Bankruptcy for all stocks is 118.89% lower than the firm.''
BANKRUPTCY IS IMMINENT The Writing is on the Wall!
READ THIS OVER AND OVER UNTIL YOU SEE THE REAL PICTURE.
And Before you say Going Concern is in All Filings.....LOL
DO Your Homework.
''We have experienced net losses, negative operating cash flows, working capital deficiencies, negative operating cash flow and shareholders’ deficiency, which have affected, and which are expected to continue to affect, our ability to satisfy our obligations. In addition, as described in Item 5.-Operating and Financial Review and Prospects-Liquidity and Capital Resources, we are in default under various debt obligations which are currently due on demand. Charter rates for bulkers have experienced a high degree of volatility and continue to be distressed. To date, we have also been unable to generate sustainable positive cash flows from operating activities. For the year ended December 31, 2013, we have a loss from continuing operations in the amount of $146.8 million. As of December 31, 2013, our cash and cash equivalents were $2.3 million and current liabilities of $291.7 million were payable within the next twelve months.
The above conditions raise substantial doubt about our ability to continue as a going concern. The financial statements do not include any adjustments relating to the recoverability and classification of asset carrying amounts or the amount and classification of liabilities that might result should we are unable to continue as a going concern.
Our existence is dependent upon our ability to obtain necessary financing, which we are currently in the process of securing. We believe that our existing cash resources, combined with projected cash flows from operations, will not be sufficient to execute our business plan and continue operations for the next twelve months without additional funding. We intend to continue to explore various strategic alternatives, including the sale of equity or debt to raise additional capital. Management is also actively taking steps to increase future revenues and reduce our future operating expenses. However, wes cannot provide any assurance that operating results will generate sufficient cash flow to meet our working capital needs or that we will be able to raise additional capital as needed.
If all of our indebtedness was accelerated as a result of our current events of default, we may not have sufficient funds at the time of acceleration to repay our indebtedness and we may not be able to find additional or alternative financing to refinance any such accelerated obligations on terms acceptable to us or on any terms, which could have a material adverse effect on our ability to continue as a going concern.''
Based on latest financial disclosure NewLead Holdings Limited has Probability Of Bankruptcy of 94%. This is 142.84% higher than that of the Services sector, and 104.65% higher than that of Shipping industry, The Probability Of Bankruptcy for all stocks is 118.89% lower than the firm.
http://www.macroaxis.com/invest/ratio/NEWL--Probability_Of_Bankruptcy
''“A going concern” opinion is one of the biggest red flags an auditor or accountant can wave in the plain view of investors after reviewing the books. A company’s accountants must warn investors if they think the company is in strong danger of failing, liquidating or running into serious troubles that threaten its ability to remain in the same corporate form. Just because a company is deemed a going concern does not mean it will fail — but accountants see the odds being high enough that it’s their responsibility to warn investors as part of disclosing the annual audit or annual report.
Fortunately for investors, the number of “going concern” opinions has been dropping since the financial crisis was at its worst in 2008. There have been a total of just 2,205 going concern auditor opinions issued for fiscal 2013 as of July 4 among all companies, which is down 12.9% from fiscal 2012, Audit Analytics says. And last year’s count of “going concerns” is down 34% from the high-water mark of this decade, 2008, when there were 3,354 going concern opinions given.''
''It's getting tougher for a company to pull out of trouble once the auditor expresses doubt in an audit opinion about whether the company can remain in business, according to the latest data on going-concern qualifications.
In its analysis of more than a decade of going concern filings, Audit Analytics found only 140 companies filed a clean audit opinion in 2012 after getting a red flag from auditors the year before. It's the first time the number dipped below 200 since 2000. In the two prior years, the number fell from 277 to 207 before hitting its low of 140 in 2011.
Based on more than 90 percent of filings submitted so far in 2013, Audit Analytics is predicting 2,517 companies will ultimately carrying the going concern qualification on their audit opinions when all 2012 financial statements are filed. That's 127 fewer companies than the 2644 reported in 2011, and the fourth consecutive year the number fell from a high of 3,352 in 2008.
Although the number of going concern filings fell for the fourth straight year, it doesn't necessarily mean company performance has improved, according to the research firm analysis. A certain number of companies will naturally fall off the list because they won't recover from whatever downfall led to the going concern qualification and therefore won't file financial statements in the subsequent year, the firm says. Based on its analysis of prior year data, Audit Analytics says 228 companies will drop out of capital markets for that reason, yet the decline is only 127.''
Don't be FOOLISH And Buy a SCAM Like NEWL.
It's Beyond Foolish to Buy a Stock Trading on the Greys where you trade in the Dark.
This company is DOOMED.
Read the latest SEC Report and Look at ALL The NEGATIVES.
Read up on the Lawsuit from TransAsia.
NEWL SCAM Has DROPPED 99% of EVERY Trading Day it Traded in the Past 5 Years.
THERE ARE NO POSTIVES FOR THIS SCAM,If there were IT WOULD NOT BE TRADING @ LESS Than .03.
Bankruptcy will WIPE OUT ALL SHAREHOLDERS.
Mineral Exploration.Coal Business May FAIL,IF It EVER Starts.
''Currently, our coal business operations are limited or non-existent. There can be no assurance that we will be able to effectively manage our limited operations or expand operations in the future.''
''Because our management team has no experience in mineral exploration and does not have formal training specific to the technicalities of mineral exploration, there is a risk that our coal business may fail.
The members of our management team have no experience operating a mining company and do not have formal training as geologists, engineers or in the technical aspects of management of a mining company. As a result, our management’s decisions and choices may not take into account standard engineering or managerial approaches that mining companies commonly use. In addition, we will have to rely on the technical services of others with expertise in mining in order for us to exploit our properties. If we are unable to contract for the services of such individuals, it will make it difficult and maybe impossible to pursue our business plan. Consequently, our operations, earnings and ultimate financial success could suffer irreparable harm due to management’s lack of experience in this industry.''
'' During 2012, we entered into a variety of transactions in order to develop a commodities sector of our business. We have entered into a joint venture arrangement and we have established a new entity with J Mining & Energy Group for the purchase and trading of coal. As of May 8, 2014, these coal operations have not yet developed.''
THIS IS 4TH 1/4 2014,WHERES THE REVENUE?????
''Expected Acquisition of Five Mile Mine
As previously announced, NewLead has entered into a separate agreement for the acquisition of title and coal excavation rights for the Five Mile mine located in Kentucky, USA with 7,695 mineral acres. The Company has received a reserve report compliant with the U.S. Securities and Exchange Commission ("SEC") methodology for the mine acquisition which states that the mine contains eight million tons in actual proven coal reserves.
The Company estimates that the mine will begin generating revenue in Q4 2013. The Company estimates that the acquisition will be concluded in Q4 of 2013, but the acquisition is subject to a number of terms and conditions and there is no assurance it will be consummated.''
No Coal From Scamming NEWL,
''NEWL repeatedly sought and obtained amendments of the sales agreements for the purchase of the Kentucky and Tennessee properties, extending the dates for the closing on
those properties multiple times due to the company's inability to obtain the financing necessary to proceed to closing.'
''According to NewLead Holdings' public filings, in late 2012 and early 2013, its joint venture affiliate NewLead JMEG entered into several large Sales Purchase Agreements pursuant to which NewLead JMEG was to supply coal to third parties from mines it owned
and/or operated in Kentucky. According to subsequent filings by NewLead Holdings, virtually all of these contracts for the sale of coal have since been terminated due to NewLead JMEG's
inability to perform by delivering coal to the purchasers.''
NEWL Is Garbage,Like LOSING Money......Buy this POS SCAM
If you bought this in July,you now need Over a 4000% Gain Just to Break Even.
NEWL IS A PUMP and DUMP.
The ones that Actually Do REAL DD,Will NOT Be Foolish and buy NEWL.
How could anyone Not know that,especially the ones that Claim to have done True DD? LMAO
If anyone Does Actually Do DD On This POS,They Would Not be FOOLISH Enough to buy and Hold this GARBAGE.
The ones that bought it in July,W/O Doing any DD,Now Need a 4000% Gain,Just To Break Even. LOL
That must be why the POS IS AT AN ALL TIME LOW And Trading on the GREY'S..LMAO
NEWL IS GARBAGE
NEWL IS A PUMP AND DUMP SCAM
Anyone that READS THE SEC FILINGS AND UNDERSTANDS WHAT THEY READ WILL KNOW THAT.
And I've DONE DD On this SCAM For 6 Years. I've Traded this POS on the Nasdaq over 100 times,I've NEVER Once Been FOOLISH Enough to Hold it Overnight.