(BOULDER, CO) -- New Frontier Media, Inc. (Nasdaq: NOOF - news), a leader in the electronic distribution of adult entertainment, announced the conversion of all the remaining shares of its 7% Series C Convertible Preferred Stock into common stock.

On October 14, 1999, the Company issued 600 shares of 7% Series C Convertible Preferred Stock at a price of $10,000 per share to a single institutional investor. The stock was initially convertible into common stock at $7.87 per share which was equal to 140% of the market price of the Company's stock at the closing date of the transaction. As provided under the terms of the Preferred Stock, the holder had the right to reprice the shares using a predetermined calculation method that after the first six months would occur on a quarterly basis.

Up through July 18, the investor initiated several transactions that resulted in the conversion of 24% of the 600 shares of Convertible Stock. With the balance being converted on July 18, the average price per converted share the investor paid was $7.19 per common share, or 126% of the $5.68 market price of the Common Stock at the time of the issuance of the 7% Series C Convertible Preferred Stock. The total number of shares issued to the investor through conversion and interest payments totaled 875,087 common shares. The investor still retains 360,000 warrants, exercisable at $7.87 per share, that were issued in conjunction with the Convertible Stock.

``We are fortunate to have an investor who understands the long-term opportunity that we believe New Frontier Media offers,'' stated Mark H. Kreloff, Chairman and CEO. ``While this financing represented a calculated risk for New Frontier Media, our financing strategy in this instance enabled the Company to raise necessary growth capital at a huge premium over the then market price of our stock. While we are thrilled with the success of this placement, we do not plan to raise any additional equity capital with a pricing reset provision. We are now in a position to attract debt financing and equity capital that has a fixed price component,'' he added.

This news release contains forward-looking statements within the meaning of Section 27A of the Securities Act and Section 21E of Securities & Exchange Act. The Company intends forward-looking statements to be covered by the safe harbor provisions for forward-looking statements. All statements regarding the Company's expected financing plans and the outcome of any contingencies are forward-looking statements. The forward-looking statements are subject to risks, and uncertainties that could cause actual results to differ materially from those set forth or implied by any forward-looking statements.

ABOUT NEW FRONTIER MEDIA, INC.

New Frontier Media, Inc. is a leader in the electronic distribution of adult entertainment with an unparalleled library of content. Through its television subsidiary, the Company distributes adult entertainment via pay-per-view and subscription cable/satellite video networks. Cable/DBS networks include Pleasure(TM), the most-edited standard available in the category; TeN, The Erotic Network(TM) and ETC, Erotic Television Clips(TM) which incorporates a partial-editing standard and Extasy(TM), the least-edited standard.

Through its Internet subsidiaries, New Frontier Media designs, creates and implements Company-owned subscription/membership-based web sites for the adult Internet consumer markets. It also operates Internet traffic sales and acquisition programs for the adult webmaster community. In addition, the Company serves as a single source for a comprehensive range of high-performance Internet products and services, including transaction processing, dedicated access, web hosting, co-location, e-commerce application development, streaming media, and bandwidth management. New Frontier Media's network infrastructure enables the delivery of live and on-demand video events to millions of Internet users.

For more information contact Keely Hawk, VP Corporate Communications at (303) 444-0900, extension 145.