Business Context and Reporting Period
Company: 22nd Century Group, Inc.
Filing Type: Form 8-K (Current Report)
Report Date: December 14, 2012 (Signed January 2, 2013)
Context: The Company reported the entry into material definitive agreements regarding its outstanding debt obligations due on December 14, 2012.
Key Financial Metrics
This filing does not provide revenue, profit, cash flow, margin, or liquidity metrics. It focuses exclusively on debt restructuring activities.
| Debt Instrument | Total Outstanding | Interest Rate | Original Maturity |
|---|---|---|---|
| Notes | $1,675,000 | 15% | December 14, 2012 |
Material Changes and Debt Restructuring
Between December 14, 2012, and January 2, 2013, the Company entered into agreements with all holders of the $1,675,000 in outstanding notes. The total debt was restructured as follows:
- Extension: Holders of $1,330,000 agreed to extend the maturity date to April 14, 2013.
- Conversion: Holders of $100,000 elected to convert their notes into shares of the Company's common stock.
- Forbearance: Holders of $215,000 entered into a forbearance agreement.
- Installment Payment: Holders of $30,000 agreed to be paid over time.
Guidance, Outlook, and Risks
The filing contains no forward-looking guidance, management commentary on future operations, or specific risk factors beyond the immediate debt restructuring. The primary contingency addressed is the avoidance of default on the notes due December 14, 2012, through the negotiated extensions and conversions.
Key Facts for Investor Verification
- Verify the dilution impact of the $100,000 note conversion into common stock.
- Confirm the specific terms of the forbearance agreement for the $215,000 portion of the debt.
- Assess the Company's ability to service the extended $1,330,000 debt obligation by the new April 14, 2013 maturity date.
- Review the attached "Letter Agreement" (Exhibit 10.1) for specific covenants or conditions attached to the extensions.