Fans of Nikola (NASDAQ:NKLA) stock, mark your calendars. The electric vehicle (EV) maker has adjourned its annual stockholder meeting to July 6. Indeed, the later date will give stockholders the opportunity to vote on a number of potential proposals dictating the company’s path forward.
What’s going on with Nikola lately?
Well, on June 7, Nikola held its Annual Meeting of Stockholders in which investors cast their votes on several different company changes. These changes include the election of new directors and, chiefly, the issuance of more NKLA stock
However, for Proposal 2 — which would allow Nikola to expand its float of shares — Nikola requires more than 50% of all outstanding shares to vote for the proposal for the initiative to pass. This is in contrast to most other proposals that simply require a majority of shares voted, with no requirement for the number of shares voted. As a result, Nikola adjourned the meeting until early July.
“More than 77% of shares voted through June 6 have been in favor of Proposal 2, but more time is needed to obtain the required vote,” Nikola said on Wednesday.
NKLA Stock Inches Up Despite Delisting Concerns
While Nikola has long been an EV startup in the doghouse, lately the company’s woes have been particularly pronounced.
As it stands, NKLA stock is down to just 60 cents per share. That’s well below Nasdaq’s $1 minimum bid price requirement. On top of that, Nikola has also been struggling with waning demand in the face of a potential recession. This reduced investor interest has effectively cut its cash supply. This is especially bad timing, given that the EV maker is just weeks away from its initial commercial production of its hydrogen fuel cell electric truck.
According to Nikola, should Proposal 2 fail to pass, Nikola’s business goals “will be delayed or compromised.”
As it stands, Nikola is in something of a race against time. In May, the company received a delisting notice from Nasdaq for failure to maintain the minimum $1 share price. The company has 180 to 360 days to comply with requirements or it will be removed from the exchange entirely.
At this point, some analysts believe Nikola will be forced to conduct a reverse stock split in order to get back up to $1 per share. NKLA stock is down more than 70% year-to-date (YTD). Clearly, investors are unlikely to be enough to prop up Nikola in time.
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On the date of publication, Shrey Dua 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.