UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): October 11, 2024
22nd Century Group, Inc.
(Exact Name of Registrant as Specified in Charter)
| Nevada | 001-36338 | 98-0468420 |
(State or Other Jurisdiction
of Incorporation) | (Commission File Number) | (I.R.S. Employer
Identification No.) |
321 Farmington Road, Mocksville, North Carolina (Address of Principal Executive Office) | 27028 (Zip Code) |
Registrant’s telephone number, including area code: (716) 270-1523
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| ¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| ¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading symbol | Name of each exchange on which
registered |
| Common Stock, $0.00001 par value | XXII | NASDAQ Capital Market |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter). Emerging growth company ¨
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨
| Item 1.01 | Entry into a Material Definitive Agreement. |
Securities Purchase Agreement
On October 11, 2024, 22nd Century Group, Inc. (the “Company”) and certain investors (the “Investors”) entered into a securities purchase agreement (the “Securities Purchase Agreement”) relating to the issuance and sale of shares of common stock of the Company (the “Common Stock”) pursuant to a registered direct offering and a private placement of warrants to purchase shares of common stock (collectively, the “Offering”). The Investors purchased approximately $2.1 million of shares and warrants, consisting of an aggregate of 14,266,666 shares of Common Stock and warrants (the “Warrants”) to purchase 28,533,333 shares of common stock, at a purchase price of $0.15 per share and accompanying warrant. The Warrants are exercisable after the Stockholder Approval Date (as defined in the Securities Purchase Agreement) at an exercise price of $1.00 per share of common stock, expire on the date that is five (5) years after the Stockholder Approval Date and are subject to adjustment in certain circumstances, including upon any subsequent equity sales at a price per share lower than the then effective exercise price of such Warrants, then such exercise price shall be lowered to such price at which the shares were offered. The Offering is expected to close on October 14, 2024, subject to customary closing conditions.
The Securities Purchase Agreement provides that, subject to certain exceptions, until 30 days after the closing of the Offering, neither the Company nor any of its subsidiaries will issue, enter into any agreement to issue or announce the issuance or proposed issuance of any shares of common stock or common stock equivalents. The Securities Purchase Agreement also provides that the Investors in the Offering have a right of participation in future equity or equity linked offerings by the Company for 9 months following the Closing Date (as defined in the Securities Purchase Agreement).
The Securities Purchase Agreement provides that, subject to certain exceptions, for a period of one year following the closing of the Offering, the Company will be prohibited from effecting or entering into an agreement to effect any issuance by the Company or any of its subsidiaries of common stock or common stock equivalents (or a combination of units thereof) involving a Variable Rate Transaction (as defined in the Securities Purchase Agreement).
The net proceeds to the Company from the Offering, after deducting the fees of Dawson James Securities, Inc. (the “Placement Agent”) and the Company’s estimated offering expenses, are expected to be approximately $2.0 million.
The Common Stock is being offered and sold pursuant to the Company’s Registration Statement on Form S-3 (Registration No. 333-270473) previously filed with the Securities and Exchange Commission (the “SEC”) and declared effective on March 31, 2023, the base prospectus included therein and the related prospectus supplement to be filed. The Warrants are being issued in a private placement and were exempt from registration under the Securities Act of 1933, as amended (the “Securities Act”), in reliance on Section 4(a)(2) thereof as a transaction not involving a public offering and/or Rule 506 of Regulation D promulgated thereunder. The Company has agreed to file a registration statement on Form S-3 (or other appropriate form if the Company is not then S-3 eligible) providing for the resale by the Investors of the shares issued and issuable upon exercise of the Warrants within 30 trading days of the date of the Securities Purchase Agreement.
The shares issuable upon exercise of the Warrants are subject to stockholder approval. The Company has agreed to hold an annual or special meeting of stockholders within 75 days following the Closing Date (as defined in the Securities Purchase Agreement) to have stockholders approve the issuance of the shares of common stock underlying the Warrants pursuant to applicable Nasdaq rules.
The Company will pay the Placement Agent a cash fee of 6.0% of the gross proceeds from the Offering, an additional 6.0% cash fee of any cash exercise of the Warrants and to reimburse the Placement Agent for its expenses, including the reimbursement of legal fees up to an aggregate of $10,000. In addition, the Company agreed to issue an placement agent warrants to purchase an aggregate of 856,000 shares of common stock (the “Placement Agent RD Warrants”) to the Placement Agent or its designees with substantially the same terms as the Warrants, except that the Placement Agent RD Warrants will terminate five years following the commencement of sales of the Offering and have an exercise price of $1.25.
Following the consummation of the Offering, the Company will have 45,702,624 shares of common stock issued and outstanding.
The foregoing summaries of the terms of the Securities Purchase Agreement, the Warrants and the Placement Agent RD Warrants are subject to, and qualified in their entirety by, the forms of such documents attached hereto as Exhibits 10.1, 4.1, and 4.2, respectively, and incorporated herein by reference. Each of the Securities Purchase Agreement and the Warrants contains representations and warranties that the respective parties made to, and solely for the benefit of, the other parties thereto in the context of all of the terms and conditions of those agreements and in the context of the specific relationship between the parties. The provisions of the Securities Purchase Agreement, including the representations and warranties contained therein, are not for the benefit of any party other than the parties to such agreement or as stated therein and are not intended as a document for investors and the public to obtain factual information about the current state of affairs of the parties to the documents and agreements. Rather, investors and the public should look to other disclosures contained in the Company’s filings with the SEC.
A copy of the opinion of Foley & Lardner LLP relating to the legality of the issuance and sale of the shares of common stock is attached hereto as Exhibit 5.1.
Item 3.02 Unregistered Sales of Equity Securities
The disclosure required by this Item, and included in Item 1.01 of this Current Report, is incorporated herein by reference. Neither the Warrants nor the shares of the Company’s common stock issuable upon exercise of the Warrants have been registered under the Securities Act, and may not be sold in the United States absent registration or an applicable exemption from the registration requirements of the Securities Act.
Item 9.01(d): Financial Statements and Exhibits.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| | 22nd Century Group, Inc. |
| | |
| | /s/ Lawrence D. Firestone |
| Date: October 11, 2024 | Lawrence D. Firestone |
| | Chief Executive Officer |
