<\/p>\n
The following discussion and analysis is intended as a review of significant Special Note Regarding Forward-Looking Statements<\/p>\n This Quarterly Report on form 10-Q, together with other statements and In addition, from time to time, we or our representatives may make While we believe we have identified material risks, these risks and Although we believe the expectations reflected in the forward-looking statements Forward-looking statements include, but are not limited to, statements about:<\/p>\n We are an all-electric, off-road powersports vehicle company developing and Beginning in We have selected a supplier to manufacture the 2023 Runt, a smaller version of We are designing an upgraded Grunt, the 2023 Grunt EVO, that will have a belt Also in the fourth quarter of 2022, we expect to begin selling the 2023 Volcon In We signed a lease for a dedicated, built-to-suit manufacturing facility on 53 The Company evaluated the cost of this facility in relation to other lower cost We plan to sell our vehicles and accessories globally in a three-phase rollout Due to recurring losses, there is no provision for income taxes for any period Revenue for the three months ended Cost of goods sold for the three months ended In the next 6-9 months we could experience manufacturing delays due to shipping Sales and marketing expenses relate to costs to increase exposure and awareness Sales and marketing expenses were Sales and marketing expenses were We expect sales and marketing expenses to increase as we expand our General and Administrative Expense<\/p>\n General and administrative expenses relate to costs for our finance, accounting For the three months ended For the three months ended We expect general and administrative expenses to increase as we increase Product development expenses relate to development of our products and process Product development expenses were Product development expenses were We expect product development costs to increase in the future as our product Interest and Other Expenses<\/p>\n Interest and other expenses for the three months ended Net loss for the three months ended Liquidity and Capital Resources<\/p>\n On Cash used in operating activities<\/p>\n Net cash used in operating activities was Net cash used in operating activities was Cash used in investing activities<\/p>\n Net cash used in investing activities was Cash provided by financing activities<\/p>\n Cash provided from financing activities for the period ended Net cash provided by financing activities was Our continuation as a going concern is dependent upon our ability to obtain JOBS Act Accounting Election<\/p>\n The recently enacted JOBS Act provides that an “emerging growth company” can We have implemented all new accounting pronouncements that are in effect and may No critical accounting policies or estimates existed as of \u00a9 Edgar Online, source The following discussion and analysis is intended as a review of significant factors affecting the Company’s financial condition and results of operations for the periods indicated. This discussion and analysis should be read in conjunction with the financial statements and related notes appearing elsewhere in this Quarterly Report on Form 10-Q and the Company’s Annual […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-13925","post","type-post","status-publish","format-standard","hentry"],"_links":{"self":[{"href":"https:\/\/advwisdom.com\/a\/wp-json\/wp\/v2\/posts\/13925","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/advwisdom.com\/a\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/advwisdom.com\/a\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/advwisdom.com\/a\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/advwisdom.com\/a\/wp-json\/wp\/v2\/comments?post=13925"}],"version-history":[{"count":0,"href":"https:\/\/advwisdom.com\/a\/wp-json\/wp\/v2\/posts\/13925\/revisions"}],"wp:attachment":[{"href":"https:\/\/advwisdom.com\/a\/wp-json\/wp\/v2\/media?parent=13925"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/advwisdom.com\/a\/wp-json\/wp\/v2\/categories?post=13925"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/advwisdom.com\/a\/wp-json\/wp\/v2\/tags?post=13925"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
\nfactors affecting the Company’s financial condition and results of operations
\nfor the periods indicated. This discussion and analysis should be read in
\nconjunction with the financial statements and related notes appearing elsewhere
\nin this Quarterly Report on Form 10-Q and the Company’s Annual Report on Form
\n10-K, which contains audited financial statements of the Company as of and for
\nthe year ended
\nExchange Commission<\/org>. Results for the three months ended
\nnecessarily indicative of results for the year ending
\nfuture period.<\/p>\n
\ninformation publicly disseminated by the Company, contains certain
\nforward-looking statements within the meaning of Section 27A of the Securities
\nAct of 1933, as amended (the “Securities Act”), and Section 21E of the
\nSecurities Exchange Act of 1934, as amended (the “Exchange Act”). We intend such
\nforward-looking statements to be covered by the safe harbor provisions for
\nforward-looking statements contained in the Private Securities Litigation Reform
\nAct of 1995 and include this statement for purposes of complying with these safe
\nharbor provisions.<\/p>\n
\nforward-looking statements orally or in writing. We base these forward-looking
\nstatements on our expectations and projections about future events, which we
\nderive from the information currently available to us. Such forward-looking
\nstatements relate to future events or our future performance, including: our
\nfinancial performance and projections; our growth in revenue and earnings; and
\nour business prospects and opportunities. You can identify forward-looking
\nstatements by those that are not historical in nature, particularly those that
\nuse terminology such as “may,” “should,” “expects,” “anticipates,”
\n“contemplates,” “estimates,” “believes,” “plans,” “projected,” “predicts,”
\n“potential,” or “hopes” or the negative of these or similar terms. In evaluating
\nthese forward-looking statements, you should consider various factors,
\nincluding: our ability to change the direction of the Company; our ability to
\nkeep pace with new technology and changing market needs; our capital needs, and
\nthe competitive environment of our business. These and other factors may cause
\nour actual results to differ materially from any forward-looking statement.
\nForward-looking statements are only predictions. The forward-looking events
\ndiscussed in this document and other statements made from time to time by us or
\nour representatives, may not occur, and actual events and results may differ
\nmaterially and are subject to risks, uncertainties and assumptions about us. We
\nare not obligated to publicly update or revise any forward-looking statement,
\nwhether as a result of uncertainties and assumptions, the forward-looking events
\ndiscussed in this document and other statements made from time to time by us or
\nour representatives might not occur.<\/p>\n
\nuncertainties are not exhaustive. Other sections of this Form 10-Q describe
\nadditional factors that could adversely impact our business and financial
\nperformance. Moreover, we operate in a very competitive and rapidly changing
\nenvironment. New risks and uncertainties emerge from time to time, and it is not
\npossible to predict all risks and uncertainties, nor can we assess the impact of
\nall factors on our business or the extent to which any factor, or combination of
\nfactors, may cause actual results to differ materially from those contained in
\nany forward-looking statements.<\/p>\n
\nare reasonable, we cannot guarantee future results, level of activity,
\nperformance or achievements. Moreover, neither we nor any other person assumes
\nresponsibility for the accuracy or completeness of any of these forward-looking
\nstatements. You should not rely upon forward-looking statements as predictions
\nof future events. We are under no duty to update any of these forward-looking
\nstatements after the date of this Form 10-Q to conform our prior statements to
\nactual results or revised expectations, and we do not intend to do so.<\/p>\n\n\n\n\n\n\n\n 24\n\n\n\n\n\n<\/pre>\n
\n\n\n \u00b7 our ability to obtain additional funding to produce, market and sell our\n vehicles and develop new products;\n \u00b7 our ability to produce our vehicles with sufficient scale and quality to\n satisfy customers;\n \u00b7 whether we experience delays in the design, production and launch of our\n vehicles;\n \u00b7 the inability of our suppliers to deliver the necessary components for\n our vehicles at prices and volumes acceptable to us;\n \u00b7 our ability to establish a network of dealers to sell and service our\n vehicles.\n \u00b7 our vehicles failing to perform as expected;\n \u00b7 our facing product warranty claims or product recalls;\n \u00b7 our facing adverse determinations in significant product liability\n claims;\n \u00b7 customers not adopting electric vehicles;\n \u00b7 the development of alternative technology that adversely affects our\n business;\n \u00b7 the impact of COVID-19 on our business;\n \u00b7 increased government regulation of our industry;\n \u00b7 tariffs and currency exchange rates; and\n \u00b7 the conflict with
\nmanufacturing electric two and four-wheel motorcycles and utility terrain
\nvehicles (UTVs), also known as side-by-sides. In
\nofferings with two off-road motorcycles – the Grunt and the Runt. We initially
\nbegan taking orders on our website for these initial offerings and began
\ndelivering the Grunts in the third quarter of 2021. We terminated our
\ndirect-to-consumer sales platform as of
\n
\naccessories and a delivery fee representing total deposits of
\nThese orders are cancelable by the customer until the vehicle is delivered and
\nafter a 14-day acceptance period, therefore the deposits have been recorded as
\ndeferred revenue. We are assembling the Grunt in a leased production facility in
\n
\nended
\n
\nretail partners to display and sell our vehicles and accessories. Customers will
\nbe able to buy our vehicles and accessories directly from a local dealership.
\nSome of these retail partners will also provide warranty and repair services to
\nour customers. Through
\nagreements. We anticipate that we will begin shipping Grunts to dealers in
\n2022<\/chron>.<\/p>\n
\nthe Grunt, and are completing the final design and manufacturing specifications
\nwith the supplier. We expect to begin selling the Runt in the fourth quarter of
\n2022.<\/p>\n
\ndrive rather than a chain drive, an upgraded rear suspension, including a new
\nshock, a new seat and will be available in additional colors and have
\naftermarket accessory upgrades such as handlebars, grips, foot pegs and seats.
\nThe pricing for the 2023 Grunt EVO and accessories has not yet been determined.
\nWe expect the Grunt EVO to be available beginning in the fourth quarter of 2022.<\/p>\n
\nBrat E-Bike which will be manufactured by a third party. Pricing for the Brat
\nhas not yet been determined.<\/p>\n\n\n\n\n\n\n\n 25\n\n\n\n\n\n<\/pre>\n
\nexpect to publicly introduce a prototype of the Stag in the second half of 2022,
\nwith delivery of the first Stag model to customers beginning in the second half
\nof 2023. We expect the Stag to be followed by the introduction of a higher
\nperformance, longer range UTV (to be named) which we expect to be available for
\nsale in 2024.<\/p>\n
\nacres in
\nentity controlled by our founders. An amendment to the lease that will provide
\nadditional tenant improvements and access to an additional 17 acres of land was
\nprovided in
\noptions and determined that it would be in the best interest of the Company to
\nterminate this agreement. The Company notified the landlord on
\nthat it would not be leasing this facility. The Company is currently in
\nnegotiations to determine the amount of the security deposit and prepaid rent
\nthat will be returned to the Company as certain survey, architecture and
\nconstruction design costs were incurred that will be paid by the Company.<\/p>\n
\nof export sales-
\nexpected in 2022 and
\nrequirements of each country, if any. Export sales are executed through
\nindividual importers in each country that buy vehicles by the container. Each
\nimporter will sell vehicles to local dealers or directly to customers. Local
\ndealers will provide warranty and repair services for vehicles purchased in
\ntheir country. For the three months ended
\non 63 Grunts shipped to \n\n\nResults of Operations\n\n\n\nThe following financial information is for the three months ended
\npresented.<\/p>\n\n\n\n\n\n\n\n 26\n\n\n\n\n\n\nRevenue\n\n\n<\/pre>\n
\nrepresents sales of Grunts of
\ncompared to no revenue for the three months ended \n\n\nCost of goods sold\n\n\n<\/pre>\n
\ncompared to cost of goods sold of
\nCosts include labor costs of
\nassembly and quality control testing of Grunts and stock-based compensation of
\n
\nthe period was
\nfacility and inventory warehousing costs. Shipping costs and duties\/tariffs for
\ninventory purchases were
\nconstraints in our supply chain. We expect cost of goods sold to increase as we
\nsell higher quantities of Grunts, but we expect the cost per Grunt to decrease
\nas we gain efficiencies in the manufacturing process and the cost of parts is
\nreduced as we purchase in higher volumes and source additional suppliers.<\/p>\n\n\n\nSales and marketing\n\n\n<\/pre>\n
\nfor our products and developing our network of
\ndistributors.<\/p>\n
\n31, 2022<\/chron> and were primarily related to expenses associated with promoting our
\nproducts and brand of
\ncompensation of
\nconsultants,
\n
\nfor travel build our dealer network.<\/p>\n
\n2021<\/chron> and were primarily related to expenses associated with promoting our
\nproducts and brand of
\ncosts of
\ngranted to employees and consultants.<\/p>\n
\nand international distributor networks and promote our products.<\/p>\n
\nand administrative functions to support the development, manufacturing and sales
\nof our products.<\/p>\n
\nwere
\npayroll costs of
\nfees of
\n
\nfees of
\nwere
\npayroll costs of
\n
\nto share-based awards granted to employees and consultants), professional fees
\nof
\n
\nfees of
\nstaffing to support sales, manufacturing, product development and to comply with
\npublic company reporting and compliance requirements.<\/p>\n\n\n\n\n\n\n\n 27\n\n\n\n\n\n\nProduct Development Expense\n\n\n<\/pre>\n
\nto manufacture these products.<\/p>\n
\n31, 2022<\/chron> and were primarily related to expenses associated with employee payroll
\ncosts of
\ngranted to employees and consultants, professional fees of
\ndesign and
\nof
\ntools and shop supplies of
\n31, 2021<\/chron> and were primarily related to expenses associated with employee payroll
\ncosts of
\ngranted to employees and consultants, professional fees of
\ndesign, prototype parts and tooling costs of
\n
\ndevelopment activities expand for new vehicle models.<\/p>\n
\nwere not significant for either period.<\/p>\n\n\n\nNet Loss\n\n\n<\/pre>\n
\n
\n
\ndebt and equity sales.<\/p>\n
\nended
\ncompensation, write down of inventory and prepaid inventory and depreciation and
\namortization. Cash used in operating activities includes increases in inventory
\nof
\nwe purchased more inventory in the three months ended
\nfewer deposits based on the timing of inventory purchases domestically versus
\ninternationally to build Grunts for delivery to customers, a decrease of
\nmillion<\/money> as we recognized revenue for shipments to direct to consumer customers
\nin the three months ended
\nhigher accrued liabilities due to the timing of invoices received from vendors
\nand an increase in prepaid expenses of
\nlegal counsel retainers of
\nincrease director and officer liability insurance due to the public stock
\noffering that occurred in
\n
\ncompensation, and depreciation and amortization. Cash used in operating
\nactivities includes increases in inventory and prepaid inventory totaling
\nmillion<\/money> as we made payments and deposits to purchase raw materials to begin
\nproduction of the Grunt and
\ndeposits for our
\namendment to our related party lease for a facility in \n\n\n\n\n\n\n 28\n\n\n\n\n\n<\/pre>\n
\nended
\nto our Grunt manufacturing and product development. Cash used from investing
\nactivities for the period ended
\n
\nour common stock in
\nshare.<\/p>\n
\nended
\nwhich was convertible into preferred stock upon future financing events. We
\nreceived gross proceeds of
\n
\nreceived gross proceeds of
\npreferred stock. We paid commissions and expenses of
\n79,750 shares of common stock and warrants to purchase 79,750 shares of common
\nstock with an exercise price of
\noffering. This equity financing resulted in the SAFE investments of
\nas of
\nstock and the WeFunder SAFE investments converting into 351,832 shares of Series
\nA preferred stock. In
\nstock at
\ncommissions and expenses of
\ncontinued financial support from our stockholders, necessary equity financing to
\ncontinue operations and the attainment of profitable operations. As of
\n2022<\/chron>, we had incurred an accumulated deficit of
\nAdditionally, management anticipates that our cash on hand as of
\nis insufficient to fund planned operations, including the development of our
\nvehicles, beyond one year from the date of the issuance of the financial
\nstatements as of and for the three months ended
\nraise substantial doubt regarding our ability to continue as a going concern. We
\nmay be required to raise additional proceeds to fund our operations and there is
\nno guarantee that we will be able to raise funding with favorable terms, if at
\nall. Additionally, any equity issuance to raise additional proceeds during the
\n12 months following our
\nof our underwriter from our
\ntake advantage of the extended transition period provided in Section 7(a)(2)(B)
\nof the Securities Act of 1933, as amended, for complying with new or revised
\naccounting standards. In other words, an “emerging growth company” can delay the
\nadoption of certain accounting standards until those standards would otherwise
\napply to private companies. We have irrevocably elected not to avail ourselves
\nof this extended transition period and, as a result, we will adopt new or
\nrevised accounting standards on the relevant dates on which adoption of such
\nstandards is required for other public companies.<\/p>\n
\nimpact our financial statements and we do not believe that there are any other
\nnew accounting pronouncements that have been issued that might have a material
\nimpact on our financial position or results of operations.<\/p>\n\n\n\nCritical Accounting Policies\n\n\n<\/pre>\n
\n\n\n\n\n\n\n 29<\/pre>\n