After a long wait, the preliminary results for Mullen Automotive’s (NASDAQ:MULN) special meeting of stockholders are in! During the meeting, it was announced that shareholders had approved Proposal No. 1, which is an amendment to Mullen’s Second Amended and Restated Certificate of Incorporation in the form of a reverse stock split. The amendment will not be filed “prior to the later of March 6, 2023 and 180 days after such date” and will be in a range between 1-for-2 and 1-for-25.
March 6 is an important date, as that is the deadline for shares of MULN stock to trade at or above $1 for 10 consecutive days in order to satisfy Nasdaq guidelines. Nasdaq may provide the company with an 180-calendar day extension if Mullen fails to meet this requirement.
The information highlighted in the first paragraph will only go into effect if Mullen does not file a reverse split amendment before May 1, unless it does so in order to remain a member of the Russell 2000. Members of the Russell 2000 must have a minimum price of $1 during the rank day in May.
MULN Stock: Shareholders Approve Reverse Stock Split in Preliminary Voting
Based on the preliminary votes, Proposal No. 4 was also approved. The proposal seeks to make amendments to a securities purchase agreement (SPA) that will see Mullen issue $150 million in notes and up to $190 million in additional shares of Series D preferred stock.
Meanwhile, the meeting was adjourned to Jan. 25 “solely with respect to Proposal 2.” Proposal No. 2 seeks to increase the number of authorized common stock to 5 billion from 1.75 billion. Mullen cited needing more time for stockholders to consider and vote for the proposal.
Proposal No. 2 also carries a relationship with Proposal No. 1. If shareholders vote against Proposal No. 2, then Mullen’s board will receive the power to effectuate a reverse split at any time before or on Dec. 1, 2023.
The big news coming out of the meeting seems to be the reverse stock split amendment preliminary approval. However, whether or not Mullen files the amendment will depend on the results of a court hearing scheduled for Jan. 23. The hearing will be held at Delaware’s Court of Chancery.
Mullen will report the final vote results in a Form 8-K within four business days.
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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.