Company Bolsters Balance Sheet with $4.2 Million Capital Infusion
New Senior Leadership Team Announced to Further Drive Shareholder Value
Mocksville, North Carolina--(Newsfile Corp. - April 8, 2024) - 22nd Century Group, Inc. (NASDAQ: XXII), a tobacco products company focused on nicotine harm reduction, today announced that it has entered into a binding letter of agreement with its senior secured lender, intended to eliminate all of its senior secured debt through potential debt for equity exchanges. Additionally, the Company has entered into separate definitive agreements for the purchase of common stock and warrants.
The Company also announced the appointment of Daniel Otto as Chief Financial Officer, and Jonathan Staffeldt as General Counsel, effective April 6, 2024. Both are currently employed at 22nd Century Group, Otto as Corporate Controller and Staffeldt as Vice President and Deputy General Counsel. R. Hugh Kinsman, the Company's current Chief Financial Officer, will leave the Company effective June 1, 2024.
Said Larry Firestone, Chairman and CEO: "We are putting 22nd Century back on a path to growth, and eliminating our debt is another key step in cutting our external operating cash needs. Combined with a new contract manufacturing customer announced last week that is expected to increase our CMO volumes by at least 20 percent and our plans to build a new tobacco harm reduction category around our FDA authorized VLN products, we intend to become cash positive by the first quarter of 2025.
"Dan and Jonathan have been key contributors to these turnaround efforts at 22nd Century, helping us to exit the hemp/cannabis business and significantly reduce our quarterly cash use as reported in our year-end results. I also want to thank Hugh for his hard work on behalf of 22nd Century, and in particular over the past several months as we worked to transform our financial footprint."
The details of the Company's transactions can be found in an 8-K filed with the Securities and Exchange Commission on April 8, 2024.
The securities (excluding the unregistered warrants and the shares of common stock underlying the unregistered warrants) are being offered by the Company pursuant to a "shelf" registration statement on Form S-3 previously filed with the Securities and Exchange Commission, or the SEC, and declared effective by the SEC. The offering of such securities in the Registered Direct Offering will be made only by means of a prospectus, including a prospectus supplement, forming a part of the effective registration statement. A final prospectus supplement and accompanying prospectus relating to the securities being offered will be filed with the SEC. Copies of the final prospectus supplement and accompanying base prospectus may be obtained, when available, for free by visiting EDGAR on the SEC's website at www.sec.gov. Alternatively, you may contact investorrelations@xxiicentury.com for a copy of these documents or contact our principal executive offices at 321 Farmington Road, Mocksville, North Carolina 27028, c/o Corporate Secretary.
This press release shall not constitute an offer to sell or the solicitation of any offer to buy the securities discussed herein, nor shall there be any offer, solicitation, or sale of the securities in any state in which such offer, solicitation, or sale would be unlawful prior to registration or qualification under the securities laws of any such state.
About 22nd Century Group, Inc.
22nd Century Group, Inc. (NASDAQ: XXII) is an agricultural biotechnology company focused on tobacco harm reduction, reduced nicotine tobacco and improving health and wellness through plant science. With dozens of patents allowing it to control nicotine biosynthesis in the tobacco plant, the Company has developed proprietary reduced nicotine content (RNC) tobacco plants and cigarettes, which have become the cornerstone of the FDA's Comprehensive Plan to address the widespread death and disease caused by smoking. The Company received the first and only FDA Modified Risk Tobacco Product (MRTP) authorization for a combustible cigarette in December 2021. 22nd Century uses modern plant breeding technologies, including genetic engineering, gene-editing, and molecular breeding to deliver solutions for the life science and consumer products industries by creating new, proprietary plants with optimized alkaloid and flavonoid profiles as well as improved yields and valuable agronomic traits.
Learn more at xxiicentury.com, on Twitter, on LinkedIn, and on YouTube.
Learn more about VLN® at tryvln.com.
Cautionary Note Regarding Forward-Looking Statements
Except for historical information, all of the statements, expectations, and assumptions contained in this press release are forward-looking statements, including but not limited to our full year business outlook. Forward-looking statements typically contain terms such as "anticipate," "believe," "consider," "continue," "could," "estimate," "expect," "explore," "foresee," "goal," "guidance," "intend," "likely," "may," "plan," "potential," "predict," "preliminary," "probable," "project," "promising," "seek," "should," "will," "would," and similar expressions. Forward-looking statements include, but are not limited to, statements regarding (i) our strategic alternatives and cost reduction initiatives, (ii) our expectations regarding regulatory enforcement, including our ability to receive an exemption from new regulations, (iii) our financial and operating performance and (iv) our expectations for our business interruption insurance claim. Actual results might differ materially from those explicit or implicit in forward-looking statements. Important factors that could cause actual results to differ materially are set forth in "Risk Factors" in the Company's Annual Report on Form 10-K filed on March 28, 2024. All information provided in this release is as of the date hereof, and the Company assumes no obligation to and does not intend to update these forward-looking statements, except as required by law.
Investor Relations & Media Contact
Matt Kreps
Investor Relations
22nd Century Group
mkreps@xxiicentury.com
214-597-8200
To view the source version of this press release, please visit https://www.newsfilecorp.com/release/204670
SOURCE: 22nd Century Group
