22nd Century Group Inc (XXII)

[Asyp]

if you want to grow and you want to grow fast you've got 3 ways to do it...traditional bank financing (historically low rates), stock issuance, cash flow from operations...because product sales are in its infancy and the cost of distribution/brand recognition is necessary now and will be in the millions of $'s cash from ops is clearly out of question...as the company grows and is cash flow negative from ops during this period traditional bank financing would only further hinder the companies ability to scale quickly...while the common stock issuance might appear the most costly initially it will allow XXII to focus on growth and not have the obligation to repay while trying to grow...70 mil o/s will look like nothing 12 months from now...I think its the right move at this stage in the game for XXII