GRAND RAPIDS, Mich.–(BUSINESS WIRE)–Electronic Cigarettes International Group, Ltd. (OTCBB: ECIG), a global marketer and distributor of electronic cigarette and vapor products whose brands include VAPESTICK®, FIN®, Victory®, and VIP®, today provided an update on the Company’s financing and capital restructuring activities including obtaining revised terms on the company’s debt obligations and obtaining working capital to drive continued growth for its business.
The Company achieved the following progress in key areas:
- An agreement has been reached with approximately 85% of the senior note holders to extend the length of their note by an additional 18 months, reduce the interest rate to 8%, affix their conversion price, and eliminate the ratchet provision on their warrants.
- Existing investors agreed to provide short-term working capital to continue to fund the Company’s growth and operational requirements.
- Sources for a larger infusion of long-term growth capital have been identified, and ECIG is working with these investors to structure an agreement that will allow the Company to proceed with its global expansion strategy.
Executive Chairman Dan O’Neill commented, “When I joined ECIG, I made a commitment to working toward strengthening and restructuring the Company’s balance sheet to establish a solid foundation for controlled profitable growth. The restructuring of the senior note holder’s debt, and the decision by them to further invest in the firm is an important first step. We have additional steps on the capital structure and balance sheet underway that are intended to provide full visibility for shareowners on how we expect to deliver superior and sustainable growth.”
The Company previously announced consideration of a reverse stock split. This action will not directly affect the Company’s market valuation nor the percentage of ECIG stock owned by each shareholder. [Example: in a 1-for-10 reverse split, each shareholder will own one-tenth the number of shares as previously, but at the time of the split each share is worth ten times the pre-split price.]
Phil Anderson, newly appointed Chief Financial Officer at ECIG stated, “We are announcing today the initial steps that have improved our balance sheet, and anticipate additional steps to come. To facilitate obtaining the long-term financing that the Company is currently pursuing, ECIG intends to execute a reverse stock split, but this action does not dilute shareholders. However, it will be critical to provide the Company the essential resources to compete and to conclusively fix ECIG’s total capital structure, both of which are designed to drive substantial shareholder value.”
About Electronic Cigarettes International Group, Ltd. (ECIG)
Electronic Cigarettes International Group (ECIG) is dedicated to providing a compelling alternative to traditional cigarettes for the more than 1 billion current smokers around the world. ECIG is one of the world’s fast growing independent electronic cigarette companies, and owns the trademarks VAPESTICK®, FIN®, Victory®, VIP®, and others. The Company owns multiple subsidiary companies and has operations in North America, Western Europe, and other geographies. ECIG offers consumers a full product portfolio that incorporates product quality and the latest technology. The Company’s website is www.ecig.co.
Safe Harbor Disclosure
This press release contains forward-looking statements that are made pursuant to the safe harbor provisions within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements are any statement reflecting management’s current expectations regarding future results of operations, economic performance, financial condition and achievements of ECIG, including statements regarding ECIG’s expectation to see continued growth. The forward-looking statements are based on the assumption that operating performance and results will continue to materialize consistent with recent trends. Management believes these assumptions to be reasonable but there is no assurance that they will prove to be accurate. Forward-looking statements, specifically those concerning future performance are subject to certain risks and uncertainties, and actual results may differ materially. ECIG relies on a single class of products; existing or pending patents may affect ECIG’s business; and other factors disclosed in the Company’s filings with the Securities and Exchange Commission. Unless required by applicable law, ECIG undertakes no obligation to update or revise any forward-looking statements.