Volcon’s sales team is currently connecting with dealers and distributors to place pre-orders, while simultaneously modifying convertible notes. “The overwhelming majority of dealers are committed to selling Volcon products and are excited that the Stag is finally coming to market,” says CEO Jordan Davis. The Company is also working with a finance company to obtain a facility that will allow Volcon to place Stags with dealers for small cash outlays allowing the company to generate cash to reinvest in additional dealer placements. This facility will allow dealers to finance their Stag purchases.
On September 14, 2023, Volcon announced it was modifying the terms of its convertible notes and implementing cost reduction strategies to provide the company greater flexibility. The note amendment with its convertible noteholders pursuant to which the lenders agreed to, among other changes, extend the maturity of the outstanding convertible notes from February 24, 2024, to January 31, 2025 and modify certain covenants to allow Volcon to execute its business strategy as it works toward the launch of the Stag.
The amendment is subject to completion of a security agreement establishing a security interest in the assets of the company for the benefit of the noteholders. “We appreciate the support of our noteholders in making these amendments in order to give us the flexibility to raise capital to support the launch of the Stag and the growth of our business,” Davis continued, “With our Stag launch closing in, our ability to obtain funding to support manufacturing and to market the Stag to the public to generate consumer demand are key factors to our success.”
The company recently implemented further cost reduction initiatives and is continuing to evaluate its cost structure to identify incremental savings. Davis notes, "We continue to build upon our previously announced cost reduction measures, such as closing manufacturing operations in favor of outsourced production and reducing headcount in various areas of the company to support our vehicle development strategy.”
Volcon has also reduced cash expenses by agreeing to eliminate cash bonuses payable to the company’s officers in favor of stock awards and the Chief Executive Officer, Chief Financial Officer and Chief Operating Officer have voluntarily agreed to reduce their salaries by 10%. The board of directors has also agreed that all future quarterly board cash fees will be payable in the form of stock awards as well. Davis notes, “The Management Team and the Board know how important the Stag is to our company, and we recognize we need to personally support the cash reduction initiatives to ensure our success.”
To further facilitate retail sales, Volcon now has two lending firms providing financing to consumers, Synchrony Bank and Octane Roadrunner Financial.
