Mullen Automotive Implements Reverse Stock Split for Compliance

Mullen Automotive Implements Reverse Stock Split for Compliance

Mullen Automotive Inc. (NASDAQ: MULN), a leading electric vehicle manufacturer, has announced an important step in its operations. The company will implement a 1-for-100 reverse stock split of its common stock, effective September 17, 2024. This initiative is aimed at ensuring compliance with the Nasdaq minimum bid price requirement of $1.00.

Details of the Reverse Stock Split

The reverse stock split will automatically consolidate 100 shares of Mullen's common stock into a single new share. Following this split, stakeholders can expect the existing shares to trade under the same symbol, MULN, and they will see a new CUSIP number assigned to the shares post-split.

Shareholder Impact

All stockholders will experience the effects of the reverse split uniformly. The action will not change any individual’s percentage of ownership in Mullen, other than the adjustments due to rounding for fractional shares. For owners of stock in electronic form, there is no action required on their part, as the adjustment will automatically reflect in their holdings.

Background on the Decision

At a recent special meeting, shareholders supported the proposed reverse stock split. This decision comes on the heels of Mullen’s need to maintain its listing on the Nasdaq, where meeting the minimum bid price remains crucial for the company’s continued presence in the market.

Company Overview and Recent Developments

Mullen Automotive is headquartered in Southern California, constructing next-generation commercial electric vehicles. With manufacturing plants in Tunica, Mississippi, and Mishawaka, Indiana, the company began production of its commercial vehicles in August 2023. Mullen recently achieved IRS approval for federal EV tax credits for its commercial lineup, encouraging more sales opportunities for buyers.

Vehicle Models and Regulatory Approvals

The Mullen ONE and Mullen THREE models are already certified by the California Air Resources Board (CARB) and the EPA, paving the way for robust sales across the United States. Mullen's commitment to compliance and innovation is evident through receiving incentives such as the cash voucher up to $45,000 for the purchase of the Mullen THREE truck.

Expansion of the Dealer Network

The company has recently strengthened its market presence by expanding its commercial dealer network, securing partnerships with several reputable groups. This strategic move positions Mullen to have a significant presence in key markets across the Midwest, West Coast, Pacific Northwest, and New England.

Foreign Trade Zone Status

Mullen has also obtained Foreign Trade Zone (FTZ) status for its Mississippi plant. This designation allows the company to benefit from deferred duties and elimination of duties on exported vehicles, enhancing Mullen’s competitive edge in the export market.

Closing Thoughts and Future Directions

The reverse stock split is a crucial maneuver for Mullen Automotive as it continues to navigate the evolving landscape of the electric vehicle industry. The company is poised for growth with its innovative vehicle solutions and newly established market strategies. As Mullen works to meet regulatory standards and enhance shareholder value, it remains committed to its mission of leading electric vehicle development.

Frequently Asked Questions

What is the purpose of Mullen's reverse stock split?

The reverse stock split is intended to help Mullen meet the Nasdaq minimum bid price requirement, allowing the company to maintain its listing.

When will the reverse stock split take effect?

The reverse stock split will become effective on September 17, 2024, at 12:01 a.m. Eastern Time.

How will shareholders be affected by the reverse stock split?

Shareholders will see their shares consolidated; for every 100 shares, they will receive 1 new share, but their ownership percentage in the company will remain unchanged.

What recent developments have occurred at Mullen Automotive?

Mullen has begun production of commercial vehicles, received IRS tax credits for its EVs, and expanded its dealer network, enhancing its market presence.

How does the Foreign Trade Zone status benefit Mullen?

FTZ status allows Mullen to defer duties on vehicles and eliminate duties on exports, providing significant financial benefits that can improve competitiveness.

About The Author

Dedicated Author and financial expert Logan Wright here, 29 years old. After earning an economics degree, I spent a number of years working in different financial industries. My great passion is enabling everyone, from any background or experience level, to understand and be literate in financial matters.

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