22nd Century Group Enters into Securities Purchase Agreement

22nd Century Group, Inc. (NASDAQ:XXII) recently announced that it has entered into a securities purchase agreement with certain investors on October 23, 2024. The agreement involves the issuance and sale of prefunded warrants and warrants to purchase shares of the company’s common stock through a private placement. The Investors acquired prefunded warrants to purchase 28,354,914 shares of Common Stock and warrants to purchase 42,532,372 shares of Common Stock, for a purchase price of $0.10719 per Prefunded Warrant and accompanying Warrant.

The prefunded warrants are immediately exercisable upon issuance, while the warrants are exercisable after the Stockholder Approval Date at an exercise price of $1.00 per share, expiring five years after the Stockholder Approval Date and subject to adjustments under certain circumstances. The Offering is anticipated to be finalized on October 24, 2024, pending customary closing conditions.

Under the terms of the Securities Purchase Agreement, the company and its subsidiaries are restricted from issuing additional common stock or common stock equivalents until 60 days after the registration statement registering the prefunded warrants, the warrants, and the shares of Common Stock issuable upon exercise of these securities becomes effective. Additionally, the Investors in the Offering have a right to participate in future equity offerings by the Company for nine months following the Closing Date.

Furthermore, the company is prohibited from engaging in any Variable Rate Transactions involving the issuance of common stock or common stock equivalents for a one-year period after the registration statement registering the prefunded warrants, the warrants, and the shares of Common Stock becomes effective.

The net proceeds to 22nd Century Group from this Offering are expected to be approximately $2.9 million after deducting fees and expenses. The securities issued in the private placement are exempt from registration under the Securities Act of 1933, and the company has committed to filing a registration statement to facilitate resale by the Investors by specific deadlines.

The issuance of shares underlying the warrants is subject to stockholder approval, with the company slated to hold a meeting by May 30, 2025. Additionally, as per the agreement, the Placement Agent will receive a cash fee of $100,000 and placement agent warrants to purchase 2,268,393 shares of common stock.

Investors and the public are advised to refer to the company’s SEC filings for comprehensive information about the transactions and agreements mentioned in the Securities Purchase Agreement.

In compliance with regulatory requirements, the unregistered sales of equity securities by 22nd Century Group have been incorporated into this report. The Prefunded Warrants, Warrants, Placement Agent Warrants, and the shares issuable upon exercise of these securities have not been registered under the Securities Act.

Alongside the announcement, the company disclosed several exhibits related to the transactions, including the forms of Prefunded Warrant, Warrant, Placement Agent Warrant, and the Securities Purchase Agreement dated October 23, 2024. Additionally, an interactive data file has been submitted.

This report was signed on behalf of 22nd Century Group, Inc. by Lawrence D. Firestone, Chief Executive Officer, on October 23, 2024.

This article was generated by an automated content engine and was reviewed by a human editor prior to publication. For additional information, read 22nd Century Group’s 8K filing here.

About 22nd Century Group

22nd Century Group, Inc, a tobacco products company, engages in the sale and distribution of its own proprietary new reduced nicotine tobacco products. The company offers reduced nicotine content tobacco plants and very low nicotine combustible cigarette products. It also provides contract manufacturing services for conventional combustible tobacco products for third-party brands.