New Century amends agreement with Camofi

By Devika Patel

Knoxville, Tenn., July 1 - New Century Cos., Inc. entered into a letter agreement with Camofi Master DDC concerning the company's $3.5 million 12% senior secured convertible promissory note due Feb. 20, 2009, which was sold to Camofi in a private placement, according to an 8-K filed Tuesday with the Securities and Exchange Commission.

According to the new agreement, Camofi has agreed to waive certain penalties and default interest accrued on the note.

In exchange, the company agreed to issue an amended and restated $2.95 million note, which will mature on Aug. 1, 2010.

The company also will pay Camofi $70,000 on the first business day of every month for 24 months, beginning on Aug. 1.

New Century will deposit $140,000 into a controlled account satisfactory to Camofi by Aug. 22 and will take all actions necessary to ensure that so long as any amount remains outstanding under the amended note, there will be at least $140,000 in that account.

Camofi will receive five-year warrants within three business days, which are exercisable for 725,000 common shares at $0.10 per share and for 725,000 common shares at $0.20 per share.

Within three business days, Camofi will receive a certificate representing 725,000 freely tradable common shares.

The company will deliver in a timely manner whatever documents, instruments or agreements, opinions of counsel that Camofi may need in order to sell 675,000 of the common shares it received earlier.

The company will retain a restructuring adviser satisfactory to Camofi until all amounts it owes to Camofi have been repaid.

Los Angeles-based New Century produces a graffiti-resistant building material used for sound proofing.

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