Why Zeus is Offering Future Equity With a Convertible SAFE

Zeus Electric Chassis, Inc.

August 4, 2021

Zeus is a leading class 4-6 purpose-built, severe-duty, electric work truck solution in North America.
Zeus is a leading class 4-6 purpose-built, severe-duty, electric work truck solution in North America.

We’ve been asked, “Why are we selling future equity in Zeus with a convertible SAFE?”.

For us it’s all about integrity.

The valuations of companies in rapidly developing industries like electric vehicles can be volatile, but our approach with a SAFE affords our investors some downside protection while participating fully in our success.

What is a SAFE?

A SAFE, or Simple Agreement for Future Equity, is a method for investing in a company that provides for a conversion to equity upon the occurrence of a “triggering or liquidity event.”

Upon a triggering event, the SAFE investment converts to preferred stock. If the valuation is below the expected valuation price our investors receive shares a discounted price and more shares for their investment AND if our valuation exceeds the expected valuation, we share the reward.

How Does it Work?

  • Our target cap is $120 million, which given the 8,617,641 shares outstanding, equates to a share price of $13.92.
  • If at a triggering event, the valuation is below $120 million, we take the implied share price (Market Value ÷ 8,617,641) and reduce it by 20% to determine the value of the preferred shares. So as a SAFE investor, if the market valuation is below the target, you get more shares for your investment representing 20% more than your initial investment.
  • If the valuation is greater than $120 million, your preferred valuation is capped at $13.92, which means you would receive the same number of shares, but each of those shares would be more valuable, in proportion to the increased valuation.

$5K Investment – REG-CF SAFE – Scenarios

The table above illustrates a number of scenarios and valuations and the implied returns on a hypothetical $5,000 investment in the SAFE.

Why Use a SAFE? 

SAFEs address two common early-stage company investment challenges:

  • Uncertainty: Without an actively traded market, the valuations of early-stage companies may be subject to considerable uncertainty, particularly in fast growing, and rapidly evolving industries like ours. A SAFE promotes a fairer valuation, allowing some downside protection for investors, while ensuring the company can raise growth funding with upside potential. We all win as the business succeeds.
  • Complexity: Priced rounds or IPOs are commonly too complex and costly for early-stage companies to pursue. A SAFE is a less complex alternative to a traditional offering. SAFEs are ideal for early-stage companies to raise the capital they need to grow, while applying crowdfunding to open up the investment to a broader audience of investors who understand and support our business.

What is a Triggering or “Liquidity” Event?

Triggering events include, but aren’t limited to, changes of control in a Company, listing on a national securities exchange, and initial public offerings.

The date of conversion of a SAFE to equity, in the form of preferred stock, is not predetermined but can happen when a new equity round is raised or when a company decides to make its initial public offering.

Our conversion plan, projected to occur during the next two to four years, is to attract additional investments, which will require an independent valuation, and then a conversion of all of our SAFEs to preferred stock.

How Do I Invest With the Zeus Crowdfund?

Zeus is raising $10.25 million via crowdfund and 506C offerings to fund our operations and the completion of our first 20 truck builds in 2022. These offerings will close on Friday, December 31, 2021.

Zeus Electric Chassis utilizes the investment experts at Silicon Prairie to ensure a seamless investment experience for our investors. Transactions must occur on a secure & regulated portal to ensure your investment is handled properly and legally.

When you click “Invest Now,” below you will be taken to the Zeus investment page on the Silicon Prairie portal. Follow these steps to invest in Zeus:

  • Create an account & build investor profile
  • Make a pledge
  • Choose funding method (e.g., Wire, Check, ACH or IRA)
  • Fund your pledge
  • Sign Subscription Document to finalize investment

If you are an accredited investor please use this link or contact Zeus here to meet with our CEO, Wayne Kugel.

Get the Zeus Investor book here.

Disclaimer: Certain information included in this document contains forward-looking information, including “future oriented financial information” and “financial outlook” under applicable securities laws (collectively referred to herein as “forward-looking statements”). Except for statements of historical fact, the information contained herein constitutes forward-looking statements and includes, but is not limited to: (i) the projected financial performance of the Company; (ii) completion of, and the use of proceeds from, the sale of the SAFEs being offered by the Company; (iii) the expected development of the Company’s business, projects, and/or joint ventures; (iv) execution of the Company’s vision and growth strategy; (v) sources and availability of third party financing for the Company’s projects; (vi) completion of the Company’s projects that are currently underway, in development, or otherwise under consideration; (vii) renewal of the Company’s current supplier and other material agreements; and (viii) future liquidity, working capital, and capital requirements. Forward-looking statements are provided to allow potential investors the opportunity to understand management’s beliefs and opinions with respect to the future so that they may use such beliefs and opinions as one factor in evaluating an investment.

These statements are not guarantees of future performance and undue reliance should not be placed on them. Forward-looking statements necessarily involve known and unknown risks and uncertainties that may cause actual performance and financial results in future periods to differ materially from any projections of future performance or result expressed or implied by such forward-looking statements. There can be no guarantee that the Company will engage in any future financing which would give rise to the result described in this document. If such a financing does occur, there can be no guarantee as to the timing of such financing or the valuation at which such financing would be completed.

Although forward-looking statements contained in this document are based on what management of the Company believes are reasonable assumptions, there can be no assurance that forward-looking statements will prove to be accurate as actual results and future events could differ materially from those anticipated in such statements. The Company undertakes no obligation to update forward-looking statements if circumstances or management’s estimates or opinions change except as required by applicable securities laws. The reader is cautioned not to place undue reliance on forward-looking statements.