Business Context and Reporting Period
Company: 22nd Century Group, Inc.
Filing Type: Form 8-K (Current Report)
Date of Report: March 9, 2023
Principal Office: Buffalo, New York
Trading Symbol: XXII (Nasdaq Capital Market)
Key Financial Metrics
This filing does not report revenue, profit, cash flow, margins, debt, or liquidity metrics. It is a current report regarding a material definitive agreement rather than a periodic financial statement.
Material Changes and Agreements
On March 9, 2023, the Company entered into a Sales Agreement with Cowen and Company, LLC to establish an "at-the-market" (ATM) equity offering program.
- Offering Size: Up to $50,000,000 in aggregate offering price of common stock.
- Compensation: The Company will pay the Sales Agent a commission of 3.00% of the gross proceeds.
- Legal Fees: The Company will reimburse the Sales Agent for legal fees and disbursements up to $75,000.
- Registration Status: Sales will be made pursuant to a Form S-3 registration statement filed on March 10, 2023, which was not yet effective at the time of this filing.
Use of Proceeds and Outlook
The Company intends to use net proceeds for general corporate purposes, specifically:
- Expanding existing businesses and acquiring new businesses.
- Expanding and accelerating the launch of VLN reduced nicotine content tobacco cigarettes in additional markets.
- Research and development expenses.
- Procurement and development of additional intellectual property rights.
- Working capital.
The Company is not obligated to sell any shares and may suspend offers at any time. The agreement terminates upon the sale of all shares or earlier termination as permitted.
Investor Verification Checklist
- Verify the effectiveness status of the Form S-3 registration statement filed on March 10, 2023.
- Monitor the Company's actual sales activity under the ATM program and the impact on share dilution.
- Review the specific terms of the Sales Agreement (Exhibit 10.1) for conditions precedent or termination rights.
- Assess the Company's progress on the VLN product launch as a primary use of proceeds.