Replies to post #73957 on Electronic Cigarettes International Group Ltd fka

[Bjdev89]

Yes they do - i can't stress enough that we are not going to see 200 million shares dump on the market at $.45. Nor would we see that happen at $.55. These warrants sweeten the deal by giving a much much higher upside than that. The assets of the company secure most of the debt - these guys aren't blowing their warrants at low roi to try to recover their loaned money early. Ecig has big upside. Besides, ecig raises serious cash if these guys do exercise the warrants and sell them at that pps. Cash that raises their ability to grow rapidly.

Besides. Nobody is going to wake up to a 270 million OS. It'll be obvious if this begins to occur at which time we can consider the latest growth and financials.

[@shadyric]

Warrants

As additional consideration for the Lenders agreeing to enter into the Credit Agreements, the Company granted the Lenders warrants to purchase an aggregate of 176,198,571 shares of common stock, par value $0.001 per share, of the Company (the “Common Stock”) which are evidenced by Common Stock Purchase Warrants (the “Warrants”). The Warrants are exercisable for a period of seven years from the original issue date, and have an exercise price of $0.45 per share, subject to equitable adjustment as set forth therein. The number of Warrants is subject to increase if the number of shares of Common Stock issuable upon exercise of the Warrant is less than a stated percentage of the fully-diluted capitalization of the Company as of the original issue date of the Warrant.

Registration Rights Agreement

In connection with the Credit Agreements, on April 27, 2015, the Company entered into a registration rights agreement (the “Registration Rights Agreement”) with the Lenders, pursuant to which the Company agreed to register all of the shares of Common Stock issuable upon exercise of the Warrants (the “Registrable Securities”) on a Form S-1 registration statement (the “Registration Statement”) to be filed with the SEC within 45 calendar days following request to do so by the Lead Lender (the “Filing Date”), and to cause the Registration Statement to be declared effective under the Securities Act of 1933, as amended, (the “Securities Act”) within 90 days following the Filing Date (the “Effectiveness Date”).

If the Registration Statement is not filed by the Filing Date or declared effective by the Effectiveness Date, the Company is required to pay partial liquidated damages to the each Lender in the amount equal to 0.5% of the aggregate principal amount of the Term Loans made by such Lender for each 30-day period for which the Company is non-compliant, provided that such liquidated damages shall not exceed 3% of the aggregate principal of such Lender’s Term Loan.