With the month of July about a third of the way complete, Mullen Automotive’s (NASDAQ:MULN) annual meeting of stockholders on Aug. 3 is getting closer each day. Shareholders of record as of June 22 will be able to cast votes for 11 proposals. Let’s take a look at each of the proposals.
To start, Proposal 1 involves electing Kent Puckett and Mark Betor as Class II directors for a three-year term. Next, Proposal 2 carries more weight and seeks to increase authorized common stock under Mullen’s 2022 Equity Incentive Stock Plan by 52 million shares.
Proposal 3, which may be the most controversial among the proposals, seeks approval for a reverse stock split in a ratio between 1-for-2 and 1-for-100. If approved, the ratio will be decided upon by Mullen’s board.
Dear MULN Stock Fans, Mark Your Calendars for Aug. 3
What other proposals should investors be aware of? Well, Proposal 4 calls for a state of incorporation change to Maryland from Delaware. As explained by Mullen, Maryland does not require a stockholder vote “to increase or decrease the aggregate number of authorized shares of stock or the number of shares of any class or series of stock that the Maryland corporation is authorized to issue.”
If incorporated in Maryland, Mullen will also be able to affect a reverse split without shareholder approval, so long as the reverse split is not in a ratio of more than 1-for-10 over any 12-month period. In addition, Maryland does not charge a franchise tax, unlike Delaware. The state offers greater protections in the event of an unsolicited takeover as well.
Moving on, Proposal 5 and Proposal 6 seek approval for the compensation of named executive officers and a non-binding “say on frequency” vote. Next, Proposal 7 looks to approve the issuance of MULN stock to CEO David Michery, pursuant to his Performance Stock Award Agreement. Michery’s stock award agreement has several milestones, such as for vehicle completion, revenue benchmarks and battery development.
Next, Proposal 8 has a dilutive nature and involves the issuance of $7 million in common stock and warrants exercisable into common stock. After that, Proposal 9 seeks approval for the election of RBSM LLP as Mullen’s independent registered public accounting firm.
Finally, Proposal 10 and Proposal 11 involve adjourning the meeting under certain circumstances and transacting business “as may properly come before the Meeting or any adjournments or postponements thereof.”
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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.
