22nd Century Group (XXII) Reduces Debt by $8.1 Million
October 25 2023 - 9:00AM
22nd Century Group, Inc. (Nasdaq: XXII), a leading biotechnology
company focused on utilizing advanced plant technologies to improve
health and wellness with reduced nicotine tobacco, hemp/cannabis
and hops, announced that it has reduced the outstanding principle
of its Senior Secured Credit Facility from approximately $22.1
million to approximately $14.0 million as part of an amendment and
waiver process with its lenders.
The reduction reflects a waiver and repayment of
the $7.5 million minimum cash balance required under terms of the
original debenture agreements, which was held in an escrow account.
The Company also assigned an existing promissory note pertaining to
the Company’s previous holdings in Panacea Life Science Holdings as
additional consideration in the debt reduction transaction. In a
non-monetary exchange, the assigned value of the promissory note
was allocated as $600,000 to further principal reduction and $2.0
million to a reduction in the put price associated with the lenders
outstanding warrants, which portion was subsequently cancelled.
The remaining principal loan balance of $14.0
million and remaining $500,000 of the put price will be due at
maturity in 2026 in accordance with the original terms of the
debenture agreements. The Company was not required to pay any cash
to the lenders in connection with this transaction.
“We continue to actively manage our balance
sheet, with a focus on executing our cost reduction initiatives.
The reduction in principal amounts owed under the Senior Secured
Credit Facility as a result of the amendment and waiver will
provide for annual cash interest savings of approximately $0.5
million per year,” said Hugh Kinsman, Chief Financial Officer of
22nd Century Group.
Subsequent to the debt reduction, the Company
announced the consummation of a public offering with $5.25 million
in gross proceeds, which will be used for general operating
purposes.
About 22nd Century Group,
Inc.22nd Century Group, Inc. (Nasdaq: XXII) is a
leading 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. In tobacco, hemp/cannabis
and hop plants, 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. 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. 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 9, 2023. 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 ContactMatt
KrepsInvestor Relations22nd Century
Groupmkreps@xxiicentury.com214-597-8200
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