Company: XXII
Filing Date: 2025-05-22
Form Type: PRE 14A
Source: 0001641172-25-012101
Chunk: 69

Company: 22nd Century Group, Inc.
Filing Date: 2025-05-22
Form: PRE 14A
Chunk 69
---
 Warrants, for cash, at a reduced exercise price equal to $0.7893. Each holder agreed to exercise 60% of their Existing Warrants immediately (the “Initial Exercise”) and will exercise the remaining 40% within 30 calendar days following the Effectiveness Date (as defined below), provided that the Company’s stock price at such time equals or exceeds 90% of the Nasdaq Minimum Price on that date (the “Additional Exercise”), which exercise price is 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. A copy of the Inducement Letter and the Form of Inducement Warrant are attached as exhibits to the Company’s Form 8-K filed with the SEC on April 30, 2025.

The Inducement Warrants are exercisable after the receipt of stockholder approval and expire on the date that is five (5) years thereafter. The Inducement Warrants may be exercised, in certain circumstances, on a cashless basis. A holder of such warrants may also effect an “alternative cashless exercise” on or after the initial exercise date. In such event, the aggregate number of shares of common stock issuable in such alternative cashless exercise pursuant to any given notice of exercise electing to effect an alternative cashless exercise shall equal the product of (x) the aggregate number of shares of common stock that would be issuable upon exercise of the warrant in accordance with the terms of the warrant if such exercise were by means of a cash exercise rather than a cashless exercise and (y) 2.0.

The Inducement Warrants 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. Additionally, if at any time on or after the date of issuance there occurs a share combination event such as stock split, stock dividend, stock combination, recapitalization or other similar transaction involving our common stock, such as the proposed Reverse Split included herein in Proposal 6, the exercise price shall be reduced to $0.75 and the number of shares issuable shall be increased such that the aggregate exercise price, after taking into account the decrease, shall be equal to the aggregate exercise price on the issuance date. Section 3