Volcon, Inc. (NASDAQ:VLCN), a company specializing in motor vehicles and passenger car bodies, announced the approval of a reverse stock split during its special meeting of stockholders. The meeting, held virtually on Monday (NASDAQ:MNDY), resulted in stockholders granting the Board of Directors the authority to effect a reverse stock split at a ratio between 1-for-2 and 1-for-30, at the Board’s discretion, before the one-year anniversary of the meeting.
The decision to amend the Company's Second Amended and Restated Certificate of Incorporation was passed with 1,788,125 votes in favor, 847,973 against, and 7,593 abstentions. Volcon reported that approximately 50.2% of its outstanding shares were represented at the meeting.
In addition to the reverse stock split, the stockholders also approved a proposal to adjourn the Special Meeting if necessary to solicit additional proxies. This measure received 1,644,227 votes for, 744,669 against, and 29,859 abstentions, with 224,936 broker non-votes.
The company, headquartered in Round Rock, Texas, and incorporated in Delaware, has faced the need for a reverse stock split to maintain compliance with NASDAQ's minimum bid price requirement. The reverse stock split aims to increase the market price per share of Volcon's common stock, potentially improving the marketability and liquidity of the stock.
InvestingPro Insights
The approval of a reverse stock split by Volcon, Inc. (NASDAQ:VLCN) shareholders comes at a critical time for the company, as reflected in recent InvestingPro data. With a market capitalization of just $3.47 million, Volcon is facing significant financial challenges. The company's stock price has plummeted, with a one-year price total return of -99.98% as of the latest data, underscoring the urgent need for measures to boost investor confidence and maintain NASDAQ listing compliance.
InvestingPro Tips highlight that Volcon is "quickly burning through cash" and "not profitable over the last twelve months," which aligns with the company's decision to pursue a reverse stock split as a potential strategy to improve its market position. Despite these challenges, analysts anticipate sales growth in the current year, with revenue growth of 32.1% over the last twelve months.
For investors seeking a more comprehensive analysis, InvestingPro offers 15 additional tips for Volcon, providing deeper insights into the company's financial health and market performance.
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