New Century Gets Loans

The bankruptcy judge is expected to announce whether the court has approved sales agreements for some of New Century's assets, including those sought by Carrington and Greenwich. That will open the sales up to a public auction process in an effort to fetch the best price for the company's creditors.

New Century's DIP will be provided in two tranches: a working capital tranche A and tranche B component, which will be used, in part, to repay funds obtained from Citigroup Realty.

The debt is secured by various assets including a pool of mortgages with a face value of about $173 million, as well as mortgage-backed securities and about $113 million in state and federal income tax refunds New Century is hoping to get. Also included is a limited partnership interest in Carrington Investment Partners.

Rates on the tranche A portion of the DIP are London Interbank Offering Rate plus 2.75%, and they will jump up to 4.75% over LIBOR should New Century default on any payment. The mortgage lender also has to pay an additional rate of 2% if it opts to increase the debt package.

Shares fell 3 cents Wednesday to 98 cents.