Business Context and Reporting Period
Company: 22nd Century Group, Inc.
Filing Type: Form 8-K (Current Report)
Date of Report: November 9, 2012
Event: Entry into a Material Definitive Agreement and Unregistered Sales of Securities.
Key Financial Metrics
This filing reports a specific capital raise event rather than periodic financial performance. Key metrics from the transaction include:
- Aggregate Proceeds: Approximately $809,500.
- Common Stock Issued: Approximately 3,238,000 shares.
- Warrants Issued: 1,619,000 warrants (5-year term, $1.00 exercise price).
- Use of Proceeds: Licensing expenses, tobacco leaf purchases, working capital, and general corporate purposes.
Note: The filing does not provide data on revenue, profit, cash flow, margins, debt, or liquidity for the reporting period.
Material Changes
The primary material change is the increase in outstanding equity and potential future equity through the issuance of common stock and warrants to accredited investors. The transaction was conducted pursuant to exemptions under Sections 4(2), 4(6), and Regulation S of the Securities Act of 1933, and Rule 506 of Regulation D.
Guidance, Outlook, and Risks
Management Commentary: The Company intends to utilize the raised capital specifically for licensing expenses and tobacco leaf purchases, indicating a focus on operational expansion or inventory acquisition.
Risks and Contingencies:
- Registration Status: The securities sold have not been registered under the Securities Act of 1933 and may not be offered or sold in the United States without an effective registration statement or exemption.
- Commissions: The Company may be required to pay certain commissions in connection with the Offering.
Investor Verification Checklist
- Verify the exact number of shares and warrants issued against the attached Exhibits 4.1 and 10.1.
- Confirm the identity of the "accredited investors" and any potential related party transactions.
- Review the specific terms of the "licensing expenses" and "tobacco leaf purchases" to assess operational viability.
- Check for any subsequent filings regarding the registration of these securities for public trading.