Nikola Tre BEV
Courtesy: Nikola
Electric truck maker Nikola won shareholder approval to issue new stock, the corporate said late on Thursday.
The vote paves the way in which for Nikola to raise additional funds to support the launch of its fuel-cell-powered electric Tre semitruck and the buildout of a hydrogen refueling network within the U.S. and Canada.
Nikola was forced to adjourn its annual meeting in June, and again in July, after the entire votes fell wanting the number required to pass the proposal. The corporate’s founder and former chairman and CEO, Trevor Milton, had lobbied against the proposal in a series of social media posts.
Milton resigned in 2020, but he still owns about 7.5% of Nikola’s shares and has the suitable to vote one other 5.8% via an investment vehicle he co-owns. He was convicted in October on three counts of fraud related to his time at Nikola and is due to be sentenced on Sep. 22.
Milton tried to block an analogous share-increase proposal last yr. That proposal also passed, but not until after Nikola adjourned last yr’s annual meeting thrice to drum up more votes.
Under the law in Delaware, where Nikola is incorporated, the measure originally required approval by owners of at the very least 50% of the corporate’s outstanding shares to pass. Nonetheless, that law modified on Aug. 1, and now only an easy majority of shares voted is required to approve a rise in authorized shares.
Nikola had originally asked shareholders to approve the proposal ahead of its June 6 annual meeting. While the proposal was supported by 77% of those that voted, the entire variety of shares voted fell wanting the 50% threshold then required by Delaware law. A second attempt on July 6 fell short as well.
With Thursday’s passage, Nikola said it may well now increase its total shares outstanding from 800 million to 1.6 billion, giving it added flexibility to raise money by issuing new shares as needed.
The corporate recently began production of the long-awaited hydrogen fuel cell version of its Tre electric semitruck and expects to make its first deliveries later this yr. As of Aug. 2, it had over 200 orders in hand for the new truck.
With approval to issue new shares in hand, Nikola is anticipated to raise more money to help fund the new truck’s production ramp and to expand its hydrogen refueling network within the U.S. and Canada.
Nikola will report its second-quarter results before the U.S. markets open on Friday, Aug. 4.