SEC Comment Letter for 22nd Century Group, Inc. (XXII) (CIK 0001347858) (XXII) — May 9, 2011
22nd Century Group, Inc. (XXII) (CIK 0001347858)
Date: May 9, 2011 · CIK: 0001347858 · Accession: 0000000000-11-028797
AI Filing Summary & Sentiment
Reasoning
File numbers found in text: 333-173420
Letter
Re: 22nd Century Group, Inc. Registration Statement on Form S -1 Filed April 11, 2011 File No. 333-173420 Dear Mr. Pandolifino: We have limited our review of your registration statement to those issues we have addressed in our comments. In some of our comments, we may ask you to provide us with information so we may better understand your disclosure. Please respond to this letter by amending your registration statement and providing the requested information. Where you do not believe our comments apply to your facts and circumstances or do not believe an amendment is appropriate, please tell us why in your response. After reviewing any amendment to your registration statement and the information you provide in response to these comments, we may have additional comments.
May 6, 2011 Joseph Pandolifino Chief Executive Officer 22nd Century Group, Inc. 8201 Main Street, Suite 6 Williamsville, NY 14221
General
1. Given that there is no guarantee that X -22 or Brand A and Brand B will obtain the necessary approval from the FDA , please revise significantly throughout to clarify this and to provide more balanced disclosure regarding your potential products. Please also revise to clarify that there is no guarantee that you will qualify for “Fast Track” designation. In addition, please clarify throughout that the FDA h as yet to release its regulations regarding mo dified risk cigarettes and that, as of June 2010, all cigarette companies were required to cease the use of the terms “low tar,” “light” and “ultra light .”
2. Please revise to clarify what you mean by the phrases “super -premium priced cigarette brands,” “s pecialty cigarette components,” “ful l flavor cigarette brands,” “reduce smoke exposure ,” “biomass products” and “bioconversion.”
Joseph Pandolifino 22nd Century Group, Inc. May 6, 2011 Page 2
Regist ation Statement Cover Page
3. The registration fee appears to have been calculated pursuant to Rule 457(c) of the Securities Act. Please revise footnote 2 to the Calculation of Registration Fee table or advise.
Our Company, page 1 Overview, page 1
4. Please include in one of your introductory paragraphs your revenues, assets, and losses for the most recent audited period and interim stub. This snapshot will help investors evaluate the disclosure as they read the filing. Also , disclose the fact that your independent auditor’s report expresses substantial doubt about your ability to continue as a going concern and that you will not receive any proceeds from this offering .
5. Please revise the first paragraph on page one to clarify that you have not attempted to obtain approval or authorization for your products outside of the United States and that there is no guarantee that you will be able to gain approval or authorization for your products outside of the United States .
6. We note your statement on page one that you plan to use a substantial portion of the proceeds of the Private Placem ent Offer ing to complete clinical trials for X -22. Please revise to provide quantitative information here regarding the cost of completing these trials , the amount of money raised in the Private Placement Offer ing. In addition, please either define the term “Private Placement Offer ing” or include a cross -referen ce to the definition.
7. Please revise your discussion of the clinical tr ials for X -22 and y our plans to produce and sell modified risk cigarettes by adding the disclosure from the last risk factor on page eight that the net proceeds o f the Private Placement Offer ing will not be sufficient to enable you to complete the FDA approval process for X -22 or the FDA authorization process for your Modified Risk Cigarettes and that you will have to seek additional funding to complete your business plans.
8. Please provide support for your statement on page one that X -22 is the only smoking cessation product that functions e xactly like a regular cigarette and your statement on page three tha t the modifications you have made to your proprietary tobacco do not affect the leaf constituents important to a cigarette’s characteristics, including taste and ar oma.
RED SUN and MAGIC Cigarettes, page 2
9. Please provide support to us for your statement that the ban of flavored cigarettes has created a product void in the tobacco channels where you intend to focus your marketing efforts. Alternatively, please revise to state that this is your belief.
Joseph Pandolifino 22nd Century Group, Inc. May 6, 2011 Page 3
Technology Platform and Intellectual Property, page 3
10. Please balance your disclosure regarding your intellectual property on page three with your disclosure in the last risk factor on page 18 and in the second to the last risk factor on page 19 that you have not performed searches for third- party intellectual property rights that may raise freedom- to-operate issues, that you have not obtained legal opinions regarding the commercialization of your potential products and that there may be existing patents that affect your ability to commercialize your potential products.
Recent Developments, page 3
11. Please revise to clarify the manner in which you sold 5,434,446 Private Placement Offering Sec urities in the Private Placement Offering and how this relates to the shares being offered. Additionally please reconcile the statement on page three regarding “each Unit consisting of one limited liability company membership interest of 22nd Century and a five -year warrant to purchase one half of one (1/2) limited liability company membership interest” with the statement on page 32 regarding “each such PPO Security consisting of one (1) Unit and a five -year warrant to purchase one- half of one (1/2) Unit.”
Risk Factors, page 7
12. Refer to the third sentence in the introductory paragraph to this section. All material risks should be discussed in this section. If risks are not deemed material then they should not be mentioned. Please revise accordingly.
13. We note your statement in the last paragraph on page 35 that Vector Tobacco had previously marketed Quest cigarettes. Please provide an appropriate risk factor addressing, if true, that at least one of your products was previously marketed unsuccessfully.
Risks Related to Our Business and Operations, page 7
The net proceeds of the Private Placement Offering will not be sufficient to enable us to, page 8
14. Please revise to include an estimate of the cost of completing the FDA approval process for X -22 and, if possible, for your modified risk cigarettes .
Risks Related to Ownership of Our Common Stock, page 20
We will incur increased costs and demands upon management as a result of complying, page 21
15. We note your disclosure i n this risk factor that you are currently unable to estimate the costs of complying with the laws and regulations for public companies. How ever, you
Joseph Pandolifino 22nd Century Group, Inc. May 6, 2011 Page 4
are currently a reporting company and must already comply with the laws and regulations affecting public companies. Please revise or advise.
An active trading market for our common stock may not develop or be sustained, and, page 21
16. Please reconcile your disclosure here with your disclosure on the cover page of your prospectus that your common stock is cur rently traded on the OTC Bulletin.
A significant portion of the total outstanding shares of common stock may be sold into, page 22
17. Please provide a definition for “PPO Security” and “EIP” here.
18. Please revise the first sentence in the second paragraph of this risk factor to clarify that the shares can be sold in the public market after the effective date of the registration statement.
We are controlled by our current officers, directors and principal stockholders, page 23
19. Please reconcile your disclosure here that your directors and officers own 33.8% of the outstanding shares of your common stock with your disclosure on page 26 that they own 39.50% of the outstanding shares of your common stock or advise .
Business, page 32
Overview, page 32
20. Please provide a b asis for statements such as “a global leader” and “will enable us to capture a significant share of the global market…” on page 32 and “well -positioned to capture a significant share of this market” and “expand the smoking cessation marke t” on page 33.
21. We note your disclosure that you own or exclusively control 98 issued patents. Please revise to clarify the number of patents that you hold and, to the extent material, please disclose the duration of your patents and licenses.
Market, p age 34
22. Please revise the reference to the Datamonitor forecast in the last paragraph on page 34 to indicate the first date covered by the forecast. If it is not a recent forecast please tell us why the forecast is still reliable .
Joseph Pandolifino 22nd Century Group, Inc. May 6, 2011 Page 5
Modified Risk Tobacco Products, page 35
23. Please revise to provide support for your statement in the last sentence in the first paragraph on page 36.
Products, page 36
X-22 Smoking Cessation Aid, page 36
24. Please balance your statement that you plan to complete the FDA -approval process for your X -22 smoking cessation aid in the fourth quarter by adding your disclosure from the first complete risk factor on page 13 that the time required for FDA approval and authorization is lengthy and uncertain.
Brand A Cigarettes, page 37
25. Please refer to the third paragraph. Given that smokers in the study decreased the number of VLN cigarettes they smoked during the six week period, please address the possibility that this means smokers might not be interested in smo king the product in the long term.
Sales and Marketing , page 43
26. Please revise to disclose when you intend to begin marketing each product and the expected cost . Additionally we note references elsewhere to foreign markets. P lease clarify for investors whether you have current plans to market internationally, including timelines and costs as applicable.
Government Research Cigarettes, page 44
27. We note your disclosure on page 44 that “you expect to receive an additional purchase order for an additional 7.85 million SPECTRU M research cigarettes in 2011.” Please disclose here and elsewhere as appropriate that there is no guarantee that you will receive this order or other direct orders from researchers or advise.
Healthcare Reimbursement, page 44
28. Please revise the second to the last sentence on page 44 to state that it is your belief t hat you will have latitude in pricing X -22. In addition, please revise the last sentence on page 44 to state that it is your belief that the price of X -22 will not only encourage governmental and private third- party payers to cover X -22 but will also encourage smokers to attempt to quit X -22. Alternatively, please remove these statements.
Joseph Pandolifino 22nd Century Group, Inc. May 6, 2011 Page 6
Clinical Phase, page 47
29. Please revise your discussion to explain how the Phase II -B clinical trials fit into the process described in this section.
X-22 Clinical Trials, page 48
30. Please revise to disclose the amount of additional funding you will need to complete the Phase III clinical trials and whether you have any plans for raising such funding.
Biomass Products, page 49
31. Please revise to clarify what you mean by “once we have achieved success with X -22 and our Modified Risk Cigarettes ” on page 49.
32. Please revise the third paragraph on page 50 to state that it is your belief that Rubisco will compete favorably in the markets you list on page 50. In addition, please revise the last sentence in the second to the last paragraph of this section to state that it is your belief that protein concentrates from Verfola will compete fa vorably in animal feed.
Management’s Discussion and Analysis of Financial Condition and Results of Operations, page
Net Cash F rom Financing Activities, page 55
33. We note your disclosure on page 1 that you plan to use a substantial portion of the proceeds from the Private Placement Offering to complete your Phase II -B cli nical trial. Please advise as to whether these funds will be sufficient to cover the cost s associated with your Phase II -B clinical trial if you are unsuccessful with your negotiations for deferred payment arrangements relating to approximately $1,300,000 owed to NCSU and the two vendors you disclose on page 55. To the extent that these funds will be insufficient to cover your Phase II -B clinical trials if you are unsuccessful in the negotiations with NCSU and the vendors , please disclo se on page 1 and add a risk factor that discloses this risk . Please also provide ri sk factor disclosure regarding any other effects of defaulting on y our obligations .
Director Compensation, page 59
34. Please revise this section to include a director compensation table purs uant to Item 402(r) of Regulation S -K.
Joseph Pandolifino 22nd Century Group, Inc. May 6, 2011 Page 7
Executive Compensation, page 59
35. Please revise to include the compensation of Mr. Rector, Mr. Warman, and Mr. Asirwatham . For guidance, refer to Regulation S -K Compliance and Disclosure Interpretations 217.02 and 217.12, available at www.sec.gov. Additionally please revise your Summary Compensation Table on page 59 to include Mr. Rider’s compensation.
Director Compensation, page 60
36. Please recon cile your disclosure regarding director compensation on page 60 with your disclosure regarding director compensation on page 59.
Certain Relationships and Related Transactions, page 61
37. We note your disclosure on page 62 regarding shares of your common stock issued to Dr. Moynihan in lieu of cash due and payable to him as compensation. Please disclose this information as footnotes to your Summary Compensation Table on page 59, as applicable.
Exhibits
38. Please file your agreement with RTI international as an exhibit to your next amendment, or please advise.
Other
39. The financial statements should be updated, as necessary, to comply with Rule 3- 12 of Regulation S -X. We urge all persons who are responsible for the accuracy and adequacy of the disclosure in the filing to be certain that the filing includes the information the Securities Act of 1933 and all applicable Securities Act rules require. Since the company and its management are in possession of all facts relating to a company’s disclosure, they are responsible for the accuracy and adequacy of the disclosures they have made.
Notwithstanding our comments, in the event you request accelera tion of the effective date of the pending registration statement please provide a written statement from the company acknowledging that:
• should the Commission or the staff, acting pursuant to delegated authority, declare the filing effective, it does not foreclose the Commission from taking any action with respect to the filing;
Joseph Pandolifino 22nd Century Group, Inc. May 6, 2011 Page 8
• the action of the Commission or the staff, acting pursuant to delegated authority, in declaring the filing effective, does not relieve the company from its full responsibility fo r the adequacy and accuracy of the disclosure in the filing; and
• the company may not assert staff comments and the declaration of effectiveness as a defense in any proceeding initiated by the Commission or any person under the federal securities laws of the United States. Please refer to Rules 460 and 461 regarding reques ts for acceleration . We will consider a written request for acceleration of the effective date of the registration statement as confirmation of the fact that those requesting acceleration are aware of their respective responsibilities under the Securities Act of 1933 and the Securities Exchange Act of 1934 as they relate to the proposed public offering of the securities speci
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May 6, 2011 Joseph Pandolifino Chief Executive Officer 22nd Century Group, Inc. 8201 Main Street, Suite 6 Williamsville, NY 14221 Re: 22nd Century Group, Inc. Registration Statement on Form S -1 Filed April 11, 2011 File No. 333-173420 Dear Mr. Pandolifino: We have limited our review of your registration statement to those issues we have addressed in our comments. In some of our comments, we may ask you to provide us with information so we may better understand your disclosure. Please respond to this letter by amending your registration statement and providing the requested information. Where you do not believe our comments apply to your facts and circumstances or do not believe an amendment is appropriate, please tell us why in your response. After reviewing any amendment to your registration statement and the information you provide in response to these comments, we may have additional comments. General 1. Given that there is no guarantee that X -22 or Brand A and Brand B will obtain the necessary approval from the FDA , please revise significantly throughout to clarify this and to provide more balanced disclosure regarding your potential products. Please also revise to clarify that there is no guarantee that you will qualify for “Fast Track” designation. In addition, please clarify throughout that the FDA h as yet to release its regulations regarding mo dified risk cigarettes and that, as of June 2010, all cigarette companies were required to cease the use of the terms “low tar,” “light” and “ultra light .” 2. Please revise to clarify what you mean by the phrases “super -premium priced cigarette brands,” “s pecialty cigarette components,” “ful l flavor cigarette brands,” “reduce smoke exposure ,” “biomass products” and “bioconversion.” Joseph Pandolifino 22nd Century Group, Inc. May 6, 2011 Page 2 Regist ation Statement Cover Page 3. The registration fee appears to have been calculated pursuant to Rule 457(c) of the Securities Act. Please revise footnote 2 to the Calculation of Registration Fee table or advise. Our Company, page 1 Overview, page 1 4. Please include in one of your introductory paragraphs your revenues, assets, and losses for the most recent audited period and interim stub. This snapshot will help investors evaluate the disclosure as they read the filing. Also , disclose the fact that your independent auditor’s report expresses substantial doubt about your ability to continue as a going concern and that you will not receive any proceeds from this offering . 5. Please revise the first paragraph on page one to clarify that you have not attempted to obtain approval or authorization for your products outside of the United States and that there is no guarantee that you will be able to gain approval or authorization for your products outside of the United States . 6. We note your statement on page one that you plan to use a substantial portion of the proceeds of the Private Placem ent Offer ing to complete clinical trials for X -22. Please revise to provide quantitative information here regarding the cost of completing these trials , the amount of money raised in the Private Placement Offer ing. In addition, please either define the term “Private Placement Offer ing” or include a cross -referen ce to the definition. 7. Please revise your discussion of the clinical tr ials for X -22 and y our plans to produce and sell modified risk cigarettes by adding the disclosure from the last risk factor on page eight that the net proceeds o f the Private Placement Offer ing will not be sufficient to enable you to complete the FDA approval process for X -22 or the FDA authorization process for your Modified Risk Cigarettes and that you will have to seek additional funding to complete your business plans. 8. Please provide support for your statement on page one that X -22 is the only smoking cessation product that functions e xactly like a regular cigarette and your statement on page three tha t the modifications you have made to your proprietary tobacco do not affect the leaf constituents important to a cigarette’s characteristics, including taste and ar oma. RED SUN and MAGIC Cigarettes, page 2 9. Please provide support to us for your statement that the ban of flavored cigarettes has created a product void in the tobacco channels where you intend to focus your marketing efforts. Alternatively, please revise to state that this is your belief. Joseph Pandolifino 22nd Century Group, Inc. May 6, 2011 Page 3 Technology Platform and Intellectual Property, page 3 10. Please balance your disclosure regarding your intellectual property on page three with your disclosure in the last risk factor on page 18 and in the second to the last risk factor on page 19 that you have not performed searches for third- party intellectual property rights that may raise freedom- to-operate issues, that you have not obtained legal opinions regarding the commercialization of your potential products and that there may be existing patents that affect your ability to commercialize your potential products. Recent Developments, page 3 11. Please revise to clarify the manner in which you sold 5,434,446 Private Placement Offering Sec urities in the Private Placement Offering and how this relates to the shares being offered. Additionally please reconcile the statement on page three regarding “each Unit consisting of one limited liability company membership interest of 22nd Century and a five -year warrant to purchase one half of one (1/2) limited liability company membership interest” with the statement on page 32 regarding “each such PPO Security consisting of one (1) Unit and a five -year warrant to purchase one- half of one (1/2) Unit.” Risk Factors, page 7 12. Refer to the third sentence in the introductory paragraph to this section. All material risks should be discussed in this section. If risks are not deemed material then they should not be mentioned. Please revise accordingly. 13. We note your statement in the last paragraph on page 35 that Vector Tobacco had previously marketed Quest cigarettes. Please provide an appropriate risk factor addressing, if true, that at least one of your products was previously marketed unsuccessfully. Risks Related to Our Business and Operations, page 7 The net proceeds of the Private Placement Offering will not be sufficient to enable us to, page 8 14. Please revise to include an estimate of the cost of completing the FDA approval process for X -22 and, if possible, for your modified risk cigarettes . Risks Related to Ownership of Our Common Stock, page 20 We will incur increased costs and demands upon management as a result of complying, page 21 15. We note your disclosure i n this risk factor that you are currently unable to estimate the costs of complying with the laws and regulations for public companies. How ever, you Joseph Pandolifino 22nd Century Group, Inc. May 6, 2011 Page 4 are currently a reporting company and must already comply with the laws and regulations affecting public companies. Please revise or advise. An active trading market for our common stock may not develop or be sustained, and, page 21 16. Please reconcile your disclosure here with your disclosure on the cover page of your prospectus that your common stock is cur rently traded on the OTC Bulletin. A significant portion of the total outstanding shares of common stock may be sold into, page 22 17. Please provide a definition for “PPO Security” and “EIP” here. 18. Please revise the first sentence in the second paragraph of this risk factor to clarify that the shares can be sold in the public market after the effective date of the registration statement. We are controlled by our current officers, directors and principal stockholders, page 23 19. Please reconcile your disclosure here that your directors and officers own 33.8% of the outstanding shares of your common stock with your disclosure on page 26 that they own 39.50% of the outstanding shares of your common stock or advise . Business, page 32 Overview, page 32 20. Please provide a b asis for statements such as “a global leader” and “will enable us to capture a significant share of the global market…” on page 32 and “well -positioned to capture a significant share of this market” and “expand the smoking cessation marke t” on page 33. 21. We note your disclosure that you own or exclusively control 98 issued patents. Please revise to clarify the number of patents that you hold and, to the extent material, please disclose the duration of your patents and licenses. Market, p age 34 22. Please revise the reference to the Datamonitor forecast in the last paragraph on page 34 to indicate the first date covered by the forecast. If it is not a recent forecast please tell us why the forecast is still reliable . Joseph Pandolifino 22nd Century Group, Inc. May 6, 2011 Page 5 Modified Risk Tobacco Products, page 35 23. Please revise to provide support for your statement in the last sentence in the first paragraph on page 36. Products, page 36 X-22 Smoking Cessation Aid, page 36 24. Please balance your statement that you plan to complete the FDA -approval process for your X -22 smoking cessation aid in the fourth quarter by adding your disclosure from the first complete risk factor on page 13 that the time required for FDA approval and authorization is lengthy and uncertain. Brand A Cigarettes, page 37 25. Please refer to the third paragraph. Given that smokers in the study decreased the number of VLN cigarettes they smoked during the six week period, please address the possibility that this means smokers might not be interested in smo king the product in the long term. Sales and Marketing , page 43 26. Please revise to disclose when you intend to begin marketing each product and the expected cost . Additionally we note references elsewhere to foreign markets. P lease clarify for investors whether you have current plans to market internationally, including timelines and costs as applicable. Government Research Cigarettes, page 44 27. We note your disclosure on page 44 that “you expect to receive an additional purchase order for an additional 7.85 million SPECTRU M research cigarettes in 2011.” Please disclose here and elsewhere as appropriate that there is no guarantee that you will receive this order or other direct orders from researchers or advise. Healthcare Reimbursement, page 44 28. Please revise the second to the last sentence on page 44 to state that it is your belief t hat you will have latitude in pricing X -22. In addition, please revise the last sentence on page 44 to state that it is your belief that the price of X -22 will not only encourage governmental and private third- party payers to cover X -22 but will also encourage smokers to attempt to quit X -22. Alternatively, please remove these statements. Joseph Pandolifino 22nd Century Group, Inc. May 6, 2011 Page 6 Clinical Phase, page 47 29. Please revise your discussion to explain how the Phase II -B clinical trials fit into the process described in this section. X-22 Clinical Trials, page 48 30. Please revise to disclose the amount of additional funding you will need to complete the Phase III clinical trials and whether you have any plans for raising such funding. Biomass Products, page 49 31. Please revise to clarify what you mean by “once we have achieved success with X -22 and our Modified Risk Cigarettes ” on page 49. 32. Please revise the third paragraph on page 50 to state that it is your belief that Rubisco will compete favorably in the markets you list on page 50. In addition, please revise the last sentence in the second to the last paragraph of this section to state that it is your belief that protein concentrates from Verfola will compete fa vorably in animal feed. Management’s Discussion and Analysis of Financial Condition and Results of Operations, page 52 Net Cash F rom Financing Activities, page 55 33. We note your disclosure on page 1 that you plan to use a substantial portion of the proceeds from the Private Placement Offering to complete your Phase II -B cli nical trial. Please advise as to whether these funds will be sufficient to cover the cost s associated with your Phase II -B clinical trial if you are unsuccessful with your negotiations for deferred payment arrangements relating to approximately $1,300,000 owed to NCSU and the two vendors you disclose on page 55. To the extent that these funds will be insufficient to cover your Phase II -B clinical trials if you are unsuccessful in the negotiations with NCSU and the vendors , please disclo se on page 1 and add a risk factor that discloses this risk . Please also provide ri sk factor disclosure regarding any other effects of defaulting on y our obligations . Director Compensation, page 59 34. Please revise this section to include a director compensation table purs uant to Item 402(r) of Regulation S -K. Joseph Pandolifino 22nd Century Group, Inc. May 6, 2011 Page 7 Executive Compensation, page 59 35. Please revise to include the compensation of Mr. Rector, Mr. Warman, and Mr. Asirwatham . For guidance, refer to Regulation S -K Compliance and Disclosure Interpretations 217.02 and 217.12, available at www.sec.gov. Additionally please revise your Summary Compensation Table on page 59 to include Mr. Rider’s compensation. Director Compensation, page 60 36. Please recon cile your disclosure regarding director compensation on page 60 with your disclosure regarding director compensation on page 59. Certain Relationships and Related Transactions, page 61 37. We note your disclosure on page 62 regarding shares of your common stock issued to Dr. Moynihan in lieu of cash due and payable to him as compensation. Please disclose this information as footnotes to your Summary Compensation Table on page 59, as applicable. Exhibits 38. Please file your agreement with RTI international as an exhibit to your next amendment, or please advise. Other 39. The financial statements should be updated, as necessary, to comply with Rule 3- 12 of Regulation S -X. We urge all persons who are responsible for the accuracy and adequacy of the disclosure in the filing to be certain that the filing includes the information the Securities Act of 1933 and all applicable Securities Act rules require. Since the company and its management are in possession of all facts relating to a company’s disclosure, they are responsible for the accuracy and adequacy of the disclosures they have made. Notwithstanding our comments, in the event you request accelera tion of the effective date of the pending registration statement please provide a written statement from the company acknowledging that: • should the Commission or the staff, acting pursuant to delegated authority, declare the filing effective, it does not foreclose the Commission from taking any action with respect to the filing; Joseph Pandolifino 22nd Century Group, Inc. May 6, 2011 Page 8 • the action of the Commission or the staff, acting pursuant to delegated authority, in declaring the filing effective, does not relieve the company from its full responsibility fo r the adequacy and accuracy of the disclosure in the filing; and • the company may not assert staff comments and the declaration of effectiveness as a defense in any proceeding initiated by the Commission or any person under the federal securities laws of the United States. Please refer to Rules 460 and 461 regarding reques ts for acceleration . We will consider a written request for acceleration of the effective date of the registration statement as confirmation of the fact that those requesting acceleration are aware of their respective responsibilities under the Securities Act of 1933 and the Securities Exchange Act of 1934 as they relate to the proposed public offering of the securities speci