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Mullen Technologies, which previously announced a definitive agreement to merge with Net Element in a stock-for-stock reverse merger in which Mullen's stockholders will receive a majority of the outstanding stock in the post-merger company, announced it will begin build-out of its pilot manufacturing facility and start taking pre-orders of its MX-05 fully electric SUV on Oct. 1. Mullen Technologies' high voltage battery R&D center in Monrovia, California, begins its transformation into a pilot facility for its line of fully electric SUVs on the first of October. The construction is slated for completion by April 2021 with the first MX-05 SUVs, each assembled in America, expected to be delivered to customers by Q2 of 2022. Mullen will begin taking pre-orders for the MX-05 model, at a base starting price of $55,000, on October 1, through its website or at any Mullen retail location in the U.S. The pilot facility will be used to assemble up to 1,000 MX-05 fully electric vehicles per year and subsequently for all other upcoming models such as the MX-07 and MX-03. The operation consists of general assembly, battery assembly, R&D facility and warehouse. Mullen expects to add up to 100 new employees to its manufacturing and logistics team in Monrovia, California.

Net Element issues the following letter to shareholders: "We hope you and your loved ones remain safe and healthy during this COVID pandemic. We continue working diligently on the pending merger with Mullen Technologies and we have taken steps to reduce operating expenses related to our payments processing business as we go through the process contemplated by the Merger Agreement. Since announcing the contemplated merger, we have received a number of inquiries from shareholders requesting clarification regarding the expected number of shares that will be outstanding at closing if the pending merger with Mullen were to be approved. The Merger Agreement provides for a cap of 75 million outstanding shares at the closing of the transaction which cannot be exceeded without both parties' approval; however, this is a maximum number and there is no way of knowing the actual number of shares that will be outstanding at that time. By way of example only, if the share price on the transaction closing date is the same as the closing price on August 18, 2020, the Company anticipates that the number of shares outstanding at closing will be approximately 50 million. If the share price on the transaction closing date is less than the closing price on August 18, 2020, the Company anticipates that the number of shares outstanding at closing will be greater than 50 million but subject to the 75 million share cap. After Mullen's completion and delivery to the Company of its audited financial statements, the Company intends to prepare and file with the SEC a registration statement on Form S-4 in which the proxy statement will be included as a part of the prospectus, in connection with the registration under the Securities Act of the shares of the Company to be issued in connection with the transactions contemplated in the Merger Agreement. Consummation of the merger, the divestiture, the private placement and the other transactions contemplated in the Merger Agreement, are subject to customary conditions including, among others, regulatory approvals and the approval of the Company's stockholders."

Net Element announced the execution of a definitive agreement to merge with privately-held Mullen Technologies, a Southern California-based electric vehicle company, in a stock-for-stock reverse merger in which Mullen's stockholders will receive a majority of the outstanding stock in the post-merger Company. Under the terms of the agreement, Net Element's wholly owned, newly formed subsidiary will acquire all the outstanding shares of Mullen. Upon completion of the merger, Net Element shareholders will own 15% and Mullen shareholders will own 85% of the issued and outstanding shares of the combined Company. Net Element has the right to acquire up to an additional 6.7% of the combined Company depending on the amount of loans from Net Element to Mullen prior to closing. Immediately prior to completion of the merger, Net Element will, subject to Net Element's stockholders' approval, divest itself of its payments-processing business and portfolio. The completion of the merger is subject to shareholder and NASDAQ approval, as well as other conditions referenced in the merger agreement. Upon closing of the merger, Net Element's current management team and board of directors will resign and be replaced by a management team led by David Michery, Mullen's founder, chairman and chief executive officer and the Mullen-nominated board of directors. The Company has obtained a fairness opinion satisfactory to its board of directors, and each company's board of directors has approved the execution of the merger agreement. Mullen's shareholders have approved the execution of the merger agreement and the transactions contemplated in such agreement.

Net Element provides an update on the pending merger with Mullen Technologies. The Company has amended the original Letter of Intent, or LOI, to reflect an extended exclusivity period of 30 days, until August 10. "We are working earnestly on due diligence and other matters in the hope of bringing this merger to fruition for the benefit of our shareholders. The EV industry continues showing robust growth and if consummated, we believe the merger can increase shareholder value," commented Oleg Firer, Executive Chairman and CEO of Net Element.