Today is March 6 and, with the market closed, Mullen Automotive (NASDAQ:MULN) stock has still not reached a price of at least $1 for a minimum of 10 consecutive business days. A minimum price of $1 is a requirement for all members of the Nasdaq exchange.
Nasdaq first notified Mullen of its deficiency on Sept. 7, 2022 due to MULN stock closing below $1 for 30 consecutive business days. It provided the company with a 180-calendar day compliance period to resolve the issue.
On the bright side, Mullen is eligible to file for a 180-calendar day extension if it can provide Nasdaq with a plan of compliance, like a reverse stock split plan. A reverse split seems to be the best option, as MULN closed at 23 cents today. That means it currently needs a 335% gain to reach $1 per share.
Mullen Misses $1 Minimum Price Deadline
Mullen held its Special Meeting of Stockholders last January after several adjournments. During the meeting, shareholders voted to approve a reverse split proposal in a range between 1-for-2 and 1-for-25.
Following the meeting, Mullen announced that it had “no plans at the current time to effect a reverse split.” However, if MULN stock is still under $1 by Sept. 6, Mullen stated that it will effect a reverse split in order to satisfy Nasdaq listing policies. This is not the only minimum price requirement on Mullen’s radar, however.
Mullen is a member of the Russell 2000 index, which also requires a minimum price of $1 per share. The index will hold its rank day on April 28, meaning members seeking continued inclusion must have a minimum price of $1 on that day. If the price is less than $1, members “will be considered eligible if the average of the daily closing prices (from its primary exchange) during the 30 days prior to the rank date is equal to or greater than $1.00.”
After rank day, the index will rebalance in June. If MULN is still below $1 by then, the company will “evaluate if it is in the best interest of shareholders” to enact a reverse split.
Unless MULN stock can reach $1 organically, shareholders should expect a reverse split in the coming months.
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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.
