Shares of Mullen Automotive (NASDAQ:MULN) stock closed in the red because the company still hasn’t filed its Form 1o-K, or annual report, for the fiscal year ended Sept. 30. Mullen has until 5:30 p.m. to file the form, or else it will be considered late.
The drama unfolded after Mullen filed a Form NT, which stands for “non-timely,” on Dec. 29. Dec. 29 marked the initial deadline for Mullen to file its 10-K, which is 90 days after the end of the fiscal year on Sept. 30. The Form NT provided the electric vehicle (EV) company with a 15-day grace period, extending the deadline to today, Jan. 13.
Mullen attributed the extension to needing more time to properly value its warrants. The warrants “could have an impact on the consolidated results of operations.” The company also added that the valuation of the warrants will have no effect on free cash flow and cash flow from operations.
MULN Stock: Mullen Fails to File Form 10-K
So, what happens if the Securities and Exchange Commission (SEC) doesn’t receive the form by 5:30 today? Firstly, Mullen would lose Rule 144 eligibility. The company would also lose the power to file a Form S-3 and a Form S-8. According to 100 F Street, Mullen will regain Rule 144 eligibility and the power to file a Form S-8 once the Form 10-K is received. However, a late Form 10-K means that Mullen will be unable to file a Form S-3 “for at least a period of 12 months.”
A Form S-3 is used in certain types of offerings, such as through raising capital through a secondary offering or the exercise of outstanding warrants. Meanwhile, a Form S-8 is a registration statement that must be filed when companies register and offer securities as a part of an employee benefit plan. Finally, Rule 144 eligibility covers the conditions in which “restricted, unregistered, and control securities can be sold or resold.”
Losing the power to file a Form S-3 could spell particular trouble for Mullen. At the company’s upcoming special meeting of stockholders on Jan. 19, it proposed several provisions related to raising capital. Proposal No. 2 seeks to increase authorized common stock to 5 billion from 1.75 billion, while Proposal No. 4 seeks to issue $150 million in notes and up to $190 million of additional Series D preferred stock.
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.
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