Mullen CEO Addresses Letter to Shareholders
David Michery discusses reasons for reverse stock split
BREA, Calif., Dec. 19, 2023 (GLOBE NEWSWIRE) — via IBN — Mullen Automotive, Inc. (NASDAQ: MULN) (“Mullen” or the “Company”), an emerging electric vehicle (“EV”) manufacturer, today shares an open letter to Mullen shareholders addressing its recent reverse stock split.
Dear Mullen Shareholders:
As most of you are aware by now, at the recently reconvened shareholders meeting held on Dec. 18, 2023, Mullen shareholders approved the Company effecting a reverse stock split.
Presenting this reverse split proposal to the Company’s Board of Directors for consideration and thereafter to our shareholders was one of the most difficult decisions I have made as CEO, especially in light of the prior reverse stock splits implemented by the Company and the dilutive impact those have had on shareholders.
I have stated on multiple occasions that the price of our stock does not reflect the value of the Company. Mullen has achieved many important milestones, including the sales and delivery of vehicles assembled at its impressive facilities – but regardless of these achievements, our stock continued to decline. We also announced that we engaged law firms to investigate and file lawsuits based on manipulative trading activities that we believe have occurred with our stock. However, despite all of these actions, the Company stock continued to trade below Nasdaq’s minimum one dollar bid price beyond allowed timelines resulting in the Company receiving a delisting notice. On appeal, the Company was granted until Jan. 22, 2024, to demonstrate that the stock had traded above one dollar for at least 20 consecutive trading days, failing which the Company would be permanently delisted from the Nasdaq capital markets.
There was only one way to give the Company the best possible chance of regaining minimum bid compliance for the mandated 20 trading days and that was by doing a significantly large reverse stock split.
As mentioned, I did not come to this decision lightly and certainly took no pleasure in taking these initiatives, but in order for the Company to survive and prosper, which is certainly in the best interests of all shareholders, the Company needs to raise capital in 2024 to fund initiatives until such time as it is cash flow positive. Most sources of capital are not willing to provide financing to the Company if it is no longer on a major national exchange. Being demoted to an over-the-counter exchange where market making and trading volumes are significantly lower would put the Company – and hence its shareholders – at great risk.
I know many of our loyal shareholders were very outspoken about not wanting another reverse stock split, and I completely understand their sentiment. However, Mullen‘s Board and I weighed the alternatives of not doing the reverse and losing our Nasdaq listing and came to the difficult decision to recommend that shareholders vote in favor of the reverse split – thereby giving us the opportunity of creating long term value for all investors who have bought our stock.
I mentioned during the Q&A session at our reconvened shareholders meeting, I personally did not vote my shares, and they were not included in the count that resulted in passing the proposal. While I firmly believe the reverse stock split is in the best interest of the shareholders, I also understand many parties were opposed to the measure and so I decided I would leave this decision solely in the hands of shareholders.
In closing, I understand that many of you are disappointed, but please know that I remain fully committed to achieving the Company’s goals which I believe are within reach and will be made exponentially easier should the Company be able to maintain its publicly traded status on a major capital markets national exchange. The passing of the proposal to effect a reverse split gives us that opportunity.
Thanks for your support and understanding.
Mullen Automotive (NASDAQ: MULN) is a Southern California-based automotive company building the next generation of electric vehicles (“EVs”) that will be manufactured in its two United States-based assembly plants. Mullen’s EV development portfolio includes the Mullen FIVE EV Crossover, Mullen-GO Commercial Urban Delivery EV, Mullen Commercial Class 1-3 EVs and Bollinger Motors, which features both the B1 and B2 electric SUV trucks and Class 4-6 commercial offerings. On Sept. 7, 2022, Bollinger Motors became a majority-owned EV truck company of Mullen Automotive, and on Dec. 1, 2022, Mullen closed on the acquisition of Electric Last Mile Solutions’ (“ELMS”) assets, including all IP and a 650,000-square-foot plant in Mishawaka, Indiana.
To learn more about the Company, visit www.MullenUSA.com.
Certain statements in this press release that are not historical facts are forward-looking statements within the meaning of Section 27A of the Securities Exchange Act of 1934, as amended. Any statements contained in this press release that are not statements of historical fact may be deemed forward-looking statements. Words such as “continue,” “will,” “may,” “could,” “should,” “expect,” “expected,” “plans,” “intend,” “anticipate,” “believe,” “estimate,” “predict,” “potential” and similar expressions are intended to identify such forward-looking statements. All forward-looking statements involve significant risks and uncertainties that could cause actual results to differ materially from those expressed or implied in the forward-looking statements, many of which are generally outside the control of Mullen and are difficult to predict. Examples of such risks and uncertainties include but are not limited to how Mullen’s stock will perform after the Reverse Stock Split, Mullen’s ability to timely implement the Reverse Stock Split, the success of the Reverse Stock Split, and Mullen’s ability to regain compliance with the Nasdaq Listing standards. Additional factors that could cause actual results to differ materially from those expressed or implied in the forward-looking statements can be found in the most recent annual report on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K filed by Mullen with the Securities and Exchange Commission. Mullen anticipates that subsequent events and developments may cause its plans, intentions and expectations to change. Mullen assumes no obligation, and it specifically disclaims any intention or obligation, to update any forward-looking statements, whether as a result of new information, future events or otherwise, except as expressly required by law. Forward-looking statements speak only as of the date they are made and should not be relied upon as representing Mullen’s plans and expectations as of any subsequent date.
Mullen Automotive, Inc.
+1 (714) 613-1900
Los Angeles, California