Saleen Automotive Inc (OTCMKTS:SLNN) Can Still Be A Penny Stock Runner

Saleen Automotive Inc (OTCMKTS:SLNN), the seller of high performance vehicles, covered by us in this piece, has delivered news recently, which have drawn trader's attention. One press release is about a car gifted to the Riverside Police Department. The other is about a contract signed with an institutional investor. The market liked both new developments and pushed the share price up from $0.0002 to $0.0004. Have a look at the recent price action:SourceBusinessAs mentioned in our first article, the company designs and sells high-performance cars from the base chassis of Ford Mustangs, Chevrolet Camaros, Dodge Challengers, and Tesla Model S vehicles. The key strategy of the company is the combination of these fantastic cars with a capable powertrain, as well as the addition of aerodynamics and braking systems. Additionally, the company sells lifestyle accessories.Recent DevelopmentsLet's focus on the most important part, the news. On May 10, 2017, the company put out that Saleen had delivered a Special Edition Saleen Mustang Police Car to the Riverside Police Officers' Association in Riverside, California:SourceWhat is the deal? The idea is very interesting. It was explained with the following words:

"This specially built Saleen Mustang will be used to bring awareness and attention to their fallen officers and promotion and avocation of the Police Officers' Assistance Fund, which provides financial assistance to officers' families in Riverside and surrounding communities." Source

But, in our opinion, this car will also benefit the company, as the more people see this model, the more people will be interested in Saleen. We checked the technology used and could find that the car was really engineered to excite. It has 730HP, powered by a twin-screw supercharger and other special characteristics that were noted in the press release. The CEO noted that the characteristics of the car are unique:

"This is one of the fastest police vehicles ever built. It is one of the most exciting projects Saleen Automotive has been involved in. If you are attempting to elude the police in the Riverside Department's jurisdiction, beware; your chances of getting away are quite slim." Source

In addition, on March 10, 2017, the company noted some modifications to a "Binding Letter of Intent" that the company had signed with the investor, SM Funding Group, Inc., on October 21, 2015. Under the agreement, SM Funding will purchase $285,000 of Series A Preferred Stock of the company. Additionally, the investor agreed to purchase $1.5 million of Series A Stock. In the most recent modification, the company added the following terms, which, we believe, will benefit shareholders.

-"We have agreed to use our best efforts to (i) increase our authorized shares of Common Stock to enable us to issue additional shares of Common Stock constituting 60% of our fully-diluted outstanding shares of common stock currently outstanding, and (ii) effect a reverse stock split of our Common Stock.-Appoint Joseph J. Bianco to our Board of Directors."Source

From this news, it is evident that the increase in the authorized shares does not matter, as the amount of shares outstanding will still be the same. Additionally, the reverse stock split may be beneficial for shareholders, because the share price number is quite small and bigger investors generally don't want to own triple zero penny stocks. Finally, the fact that Joseph J. Bianco will be part of the Board of Directors should be appreciated by traders. He represents the interests of another shareholder, SM Funding, thus he will try to defend its interests, and indirectly that of all shareholders.ConclusionSome savvy traders benefited from the news on the delivery of Special Edition Saleen Mustang Police Car. We believe that the model will be able to impress the public and will increase the awareness of Saleen cars. In our opinion, the special motor incorporated and the other characteristics were not only engineered to make the police can go faster, but also to help the company sell more cars. Traders seemed to believe the same, as they pushed up the share price. In addition, we believe that some savvy traders could also understand that the new legal document was also positive for the company. Specifically, we believe that the reverse stock split and the fact that Joseph J. Bianco, shareholder representative, will be present on the Board are all positive and could push up the share price in the future. To sum up, the company is delivering good news, so try to stay alert. We will be updating our subscribers as soon as we know more. For the latest updates on SLNN, sign up below!Disclosure: We have no position in SLNN and have not been compensated for this article.