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Nikola (NASDAQ:NKLA) stock is up 10% and trending on social media today after the automaker regained compliance with Nasdaq rules. The company manufactures and markets battery-electric trucks as well as trucks that utilize fuel cells powered by hydrogen.
Meanwhile, Nikola’s shareholders will also be asked to vote on a key proposal on July 6.
NKLA Stock Regained Compliance With a Nasdaq Rule
The Nasdaq exchange has rules about the minimum share price that equities must maintain. Nikola had previously been violating that rule, which generally states that the average of equities’ per-share prices must stay above $1.
Because Nikola’s “closing bid price… had been $1.00 per share or greater for the period of June 14 to June 28,” NKLA had regained compliance with the rule, Seeking Alpha reported.
The July 6 Vote
During Nikola’s annual shareholder meeting on July 6, shareholders will vote on a proposal that, if passed, would enable the automaker to sell many more shares of NKLA stock. Specifically, more than 50% of the outstanding shares of NKLA will have to be voted in favor of the proposal for it to pass. If the proposal is ratified, the number of the company’s outstanding shares would double.
Nikola was forced to adjourn the annual meeting on June 6 and schedule it to resume on July 6 after too few shares were voted in favor of the proposal.
According to FreightWaves: “The share increase is critical to Nikola’s survival because it lacks the cash to pay interest that was due May 31 on a $200 million loan from hedge fund Antara Capital.”
Nikola’s Price Action
Over the last month, NKLA has soared 123%, but it’s still down 37% so far this year.
On the date of publication, Larry Ramer 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.