Shares of Nikola Corp. (NKLA) saw a nearly 2% decline in the extended session on Thursday after the electric vehicle manufacturer announced that its shareholder meeting would be adjourned until August 3rd. The company failed to secure enough support for its plan to issue new stock, leading to the decision to postpone the meeting. This was not the first time the meeting had to be restarted due to this same issue.
Nikola Corp. stated that a new corporate law in Delaware, where the company is incorporated, is expected to provide assistance. The rule, scheduled to go into effect on August 1st, will change the voting threshold from a majority of the outstanding common stock to a majority of the shares that are actually voting on the proposal. According to Nikola, if the annual meeting were to be held today under this proposed new law, enough shares would have been voted in favor of the plan.
As a result of these developments, Nikola Corp.’s stock ended the regular trading day down 9%. The decline was in line with broader weakness experienced in the equity markets.