The 22nd Century Group (XXII) has announced a new $21 million senior secured bond financing to support increased operating capital needed for the growth prospects of its VLN and GVB business lines in the future. The three-year financing will be issued at a 5% original issue discount, with interest at a cash rate of 7% per annum, and will begin to repay principal at a rate of 2% of the original balance per month in the second year. The company reserves the right to redeem the loan early beginning in the second year.
We anticipate significant revenue growth in two core business lines and believe this funding will provide adequate working capital for the next year," said CFO Hugh Kinsman in a statement. "New retail partners are already discussing the expansion of VLN into more states to increase our national distribution capabilities, which will increase our manufacturing and inventory demand. Additionally, the continued growth in demand from GVB customers has also increased our capital needs for bulk raw materials and inventory in the future.
With the implementation of a new credit mechanism, 22nd Century will be extending the old debt of $2.7 million (approximately RMB 18.738 million under contract) it assumed when it acquired GVB until mid-2024. The company will file an 8-K form with the Securities and Exchange Commission to disclose the detailed terms of the new debt mechanism and refinancing of the old debt.
22nd Century Group, Inc. is a plant biotechnology company that focuses on altering nicotine levels in tobacco plants and cannabis levels in cannabis plants through genetic engineering, gene editing, and modern plant breeding. Their primary goal within the tobacco industry is to launch cigarettes with 95% less nicotine compared to traditional cigarettes in both domestic and international markets.
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22nd Century Group, a company specialized in developing and commercializing cannabis and tobacco products, has secured financing.
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