Yesterday, the electric vehicle (EV) company held its special meeting of stockholders. At the meeting, the preliminary results showed that shareholders voted to approve Proposal No.1 and No. 4. Proposal No. 1 is a reverse stock split amendment in a range between 1-for-2 and 1-for-25, while Proposal No. 4 seeks to issue $150 million in notes and up to $190 in additional shares of Series D preferred stock. The final results of the meeting will be disclosed in a Form 8-K by next week at the latest.
Mullen also decided to adjourn the meeting in regard to Proposal No. 2 to provide shareholders with more time to vote. Proposal No. 2 seeks to increase authorized common stock to five billion from 1.75 billion.
MULN Stock: CEO David Michery Receives 33.87 Million Shares
The Form 4 shows that Michery received 33.87 million shares on Jan. 18 as part of his CEO performance stock award agreement. These shares were awarded at zero dollars a piece. The day before that, Michery transferred 1.45 million shares to an unknown recipient as part of a settlement agreement dated June 28, evidenced by transaction code J. Following the award, he now directly owns 111.91 million shares.
Michery has an extremely generous CEO performance award agreement. Since September, he has received a total of 141.76 million shares, which includes the recently received 33.87 million shares. In fiscal year (FY) 2022, he received a salary of $721,154, a bonus of $750,000, and additional stock compensation worth $4.89 million. That marked a massive increase from FY 2021 when he received a salary of $409,485, no bonus, and an additional stock compensation of $1.97 million.
Michery’s CEO Performance Award Agreement
During the 2022 fiscal year, Mullen reported zero dollars in revenue, so what exactly is Michery receiving performance awards for? The CEO performance award agreement was enacted on May 5 and highlights a series of milestones, such as MULN being added to the Russell 2000 index and Mullen entering into an agreement with a company that “sets the Company or its vehicle apart from its competitors or that provides the Company a first mover or first disclosure advantage over its competitors for the Feature.”
The agreement that sets Mullen apart from other companies is titled the “Feature Milestone.” On Sept. 1, Mullen signed a partnership with Watergen that will equip Mullen vehicles with technology that can produce fresh drinking water. Michery received 44.88 million shares for satisfying this milestone.
Shares of MULN stock are down by about 15% year-to-date and down about 93% from a year ago.
On Penny Stocks and Low-Volume Stocks: With only the rarest exceptions, InvestorPlace does not publish commentary about companies that have a market cap of less than $100 million or trade less than 100,000 shares each day. That’s because these “penny stocks” are frequently the playground for scam artists and market manipulators. If we ever do publish commentary on a low-volume stock that may be affected by our commentary, we demand that InvestorPlace.com’s writers disclose this fact and warn readers of the risks.
On the date of publication, Eddie Pan did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.