Insiders of Electric Last Mile Solutions, Inc. (ELMS) Bought ELMS Stock at a Substantial Discount and the Company’s Financial Statements Cannot be Relied On
A shareholder filed a class action on behalf of purchasers of Electric Last Mile Solutions, Inc. (NASDAQ: ELMS, ELMSW) f/k/a Forum Merger III Corp. (NASDAQ: FIII, FIIIU, FIIIW) securities between March 31, 2021 and February 1, 2022, for violations of the Securities Exchange Act of 1934. ELMs is a commercial electric vehicle solutions company that designs, engineers, manufactures, and customizes electric delivery and utility vehicles.
According to the complaint, Forum Merger III Corp., a Special Purpose Acquisition Company, and Electric Last Mile, Inc. completed their merger on June 25, 2021, with Electric Last Mile Solutions being the surviving publicly traded company. During the class period, defendants failed to disclose that ELMS’ previously issued financial statements were false and unreliable and would have to be restated, and that certain ELMS executives and directors purchased equity in the Company at substantial discounts to market value without obtaining independent valuation.
On February 1, 2022, ELMS issued a press release announcing that its CEO and co-founder, and Chairman and co-founder, resigned from their positions. These departures followed an investigation conducted by a Special Committee of the Board of Directors, which had been formed in November 2021, following “an inquiry into certain sales of securities made by and to individuals associated with the company.” These sales were purportedly at substantial discounts to market value without obtaining an independent valuation. The press release also stated that “the Board concluded that the Company’s previously issued consolidated financial statements should be restated, and therefore, should not be relied upon.” On this news, ELMS’ shares declined over 50%.
If you purchased shares of Electric Last Mile Solutions, Inc. (ELMS, ELMSW) between March 31, 2021 and February 1, 2022, you have until April 4, 2022, you have legal options. Submit a form for more information.
All representation is on a contingency fee basis. Shareholders pay no fees or expenses.