Nikolai Automobile Company
Source: Nikola Motor Company
Electric truck manufacturer Nikola The company said it finally won shareholder approval to issue new shares on Tuesday. Nikola tried for two months to win enough votes to overcome the objections of the departed founder, who had previously voted his 20% interest in Nikola against the proposal.
The company said it can now increase the total number of shares outstanding from 600 million to 800 million, giving flexibility to raise cash by issuing new funds as needed. More than 66% of the total votes, or more than 211 million shares, supported the proposal, Nikola said in a statement.
The measure requires approval from owners of at least 50% of the company’s outstanding shares to be adopted.
The company’s June 1 annual shareholder meeting was postponed after Nikola’s founder and chief executive officer and former chairman and chief executive officer, Trevor Milton, voted against the proposal. The meeting briefly resumed on June 30and one more time July 18was only postponed on both occasions because the total number of votes in favor did not reach the required threshold.
Milton, who founded Nikola in 2014, leave the company in September 2020 later allegation of fraud. He remains the company’s largest shareholder. Milton owns 11% of Nikola’s outright and controls another 9% through an investment vehicle he co-owns, giving him effective control of about 90 million shares of Nikola.
Milton was indicted by a federal grand jury on charges of four crimes of fraud regarding the representations he has made to potential Nikola investors. His trial is scheduled to begin in September. Milton has denied the allegations.
Nikola said on Monday that it has agree to get battery supplier Romeo Power in a $144 million all-stock trade without requiring it to issue new shares. The truck maker is expected to report second-quarter results — and plans to buy more stock — before the US markets open on Thursday.
