Volato Group Announces Resolution of Non-Compliance with the NYSE American Rules

Rhea-AI Summary

Volato Group (NYSE American: SOAR) has received a Warning Letter from NYSE Regulation regarding non-compliance with NYSE American rules. The violations concern the unauthorized issuance of approximately 16 million shares of Class A common stock between November and December 2024, which breached Sections 301 and 713 of the NYSE American Company Guide. These sections require prior approval for listing additional securities and stockholder approval for significant stock issuances. The shares were issued pursuant to a Settlement Agreement dated November 4, 2024. Volato is implementing additional controls to prevent future violations, and NYSE Regulation has confirmed the matter will be resolved following this disclosure.

Positive

• Matter resolved with NYSE Regulation upon disclosure
• Company implementing additional controls to prevent future violations

Negative

• Unauthorized issuance of ~16M shares of Class A common stock
• Violation of NYSE American listing rules Sections 301 and 713
• Non-compliance with stockholder approval requirements for significant stock issuance

Insights

Securities Law Expert

The NYSE American's warning letter to Volato Group represents a significant compliance violation that could have material implications. The unauthorized issuance of approximately 16 million shares of Class A common stock without proper NYSE approval and shareholder consent is a serious breach of listing requirements. This type of violation often signals weak internal controls and can lead to dilution of existing shareholders' value.

The violation of both Section 301 and 713 indicates a concerning oversight in corporate governance. The requirement for stockholder approval for issuances exceeding 20% of outstanding stock is a important investor protection mechanism. While the matter is considered resolved following disclosure, the implementation of additional controls suggests previous inadequacies in compliance procedures. This event may trigger increased scrutiny from regulators and potentially impact investor confidence in management's ability to maintain proper corporate governance standards.

Corporate Governance Analyst

This compliance breach raises red flags about Volato's internal control framework and decision-making processes. The unauthorized share issuance through a Settlement Agreement suggests potential underlying financial or legal challenges that necessitated such a settlement. For retail investors, this development warrants careful attention as it could indicate:

• Potential share dilution impacting stock value
• Risk of future compliance issues
• Questions about management's adherence to regulatory requirements

While the company's commitment to implementing additional controls is positive, the incident may affect its relationship with institutional investors who typically place high importance on governance standards. The market's reaction to this disclosure could lead to increased volatility in the short term.

ATLANTA--(BUSINESS WIRE)-- Volato Group, Inc. (the “Company” or “Volato”) (NYSE American: SOAR), a leader in private aviation innovation, today announced it received from NYSE Regulation a Warning Letter (the “Letter”) as provided under Section 1009(a) of the NYSE American LLC Company Guide (the “Company Guide”) describing the Company’s failure to comply with Sections 301 and 713 of the Company Guide. Section 301 of the Company Guide prohibits a listed company from issuing, or authorizing its transfer agent or registrar to issue or register, additional securities of a listed class until it has filed an application for the listing of such additional securities and received notification from the NYSE American that the securities have been approved for listing. Section 713 of the Company Guide requires stockholder approval when additional shares to be issued in connection with a transaction involve the sale, issuance, or potential issuance of common stock (or securities convertible into common stock) equal to 20% or more of outstanding stock for less than the greater of book or market value of the stock. As noted in the Letter, the Company issued approximately 16 million shares of Class A common stock between November 2024 and December 2024 pursuant to a Settlement Agreement and Stipulation Dated November 4, 2024, that NYSE has determined were in violation of these provisions.

The Company is implementing additional controls to avoid violations of such NYSE rules in the future.

The Company has been advised by NYSE Regulation that, following the filing of this press release and the associated Current Report on Form 8-K, this matter is resolved.

About Volato

Volato (NYSE American: SOAR) is an aviation company advancing the industry with innovative solutions in aviation software and on-demand flight access. Volato’s proprietary Mission Control software drives efficiency across operations and supports operators in managing fractional ownership, charter, and other services. Volato’s Vaunt platform connects travelers with available private flights, offering a flexible option for on-demand travel. With a commitment to advanced technology and customer-focused solutions, Volato is building scalable tools to elevate service quality and operational effectiveness in private aviation.

For more information about Volato, please visit www.flyvolato.com.

Forward Looking Statements

This press release contains certain statements that may be deemed to be “forward-looking statements” within the meaning of the federal securities laws, including the safe harbor provisions under the Private Securities Litigation Reform Act of 1995. Statements that are not historical are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements relate to future events or our future performance or future financial condition. These forward-looking statements are not historical facts, but rather are based on current expectations, estimates and projections about our Company, our industry, our beliefs and our assumptions. These forward-looking statements generally are identified by words, or variation of words, such as "expects," "anticipates," "intends," "plans," "believes," "seeks," "estimates," "projects," "forecasts," "targets," "would," "will," "should," "goal," "could" or "may" or other similar expressions or the negative of these terms or other similar expressions, but the absence of these words does not mean that a statement is not forward-looking. Forward-looking statements provide our current expectations or predictions of future conditions, events, or results. All statements that address operating performance, events, or developments that may occur in the future are forward-looking statements, including statements regarding the challenges associated with executing our growth strategy, including expected deliveries of aircraft and related sales, and developing, marketing and consistently delivering high-quality services that meet customer expectations. All forward-looking statements speak only as of the date they are made and reflect the Company’s good faith beliefs, assumptions, and expectations, but they are not guarantees of future performance or events. Furthermore, the Company disclaims any obligation to publicly update or revise any forward-looking statement, except as required by law. By their nature, forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those suggested by the forward-looking statements. Factors that might cause such differences include, but are not limited to, a variety of economic, competitive, and regulatory factors, many of which are beyond the Company’s control, that are described in the Company’s periodic reports filed with the SEC including its Annual Report on Form 10-K for the fiscal year ended December 31, 2023, and other factors that the Company may describe from time to time in other filings with the SEC. You should understand that it is not possible to predict or identify all such factors and, consequently, you should not consider any such list to be a complete set of all potential risks or uncertainties.

View source version on businesswire.com: https://www.businesswire.com/news/home/20241224124691/en/

For Media:

media@flyvolato.com

For Investors:

investors@flyvolato.com

Source: Volato Group, Inc.

FAQ

What NYSE American rules did Volato Group (SOAR) violate in 2024?

Volato Group violated Sections 301 and 713 of the NYSE American Company Guide by issuing approximately 16 million shares without proper authorization and stockholder approval between November and December 2024.

How many unauthorized shares did Volato (SOAR) issue in late 2024?

Volato issued approximately 16 million shares of Class A common stock between November and December 2024 without proper NYSE American authorization.

What actions is Volato (SOAR) taking to address the NYSE American violations?

Volato is implementing additional controls to prevent future violations of NYSE American rules and has disclosed the violation as required for resolution.

Has the NYSE American non-compliance issue been resolved for Volato (SOAR)?

Yes, NYSE Regulation has advised that the non-compliance matter will be resolved following the company's press release and Current Report on Form 8-K filing.