By Michael Elkins
Nikola Corp (NASDAQ:NKLA) founder and former CEO, Trevor Milton, reportedly voted against the electric truck manufacturer’s proposal to shareholders to increase its authorized shares, according to a tweet by Bloomberg. The vote temporarily limits the company’s ability to borrow money to scale the business.
In early May, Nikola cut a deal for $200 million in cash with Antara Capital, offering convertible notes that can be paid off in cash or discounted shares.
Also in May, Nikola tapped an equity line of credit with Tumim Stone Capital for an additional $196 million in exchange for about 28.8 million new shares of stock.
CEO Mark Russell said in an interview with FreightWaves in late April, “We have been clear about the fact that we’re going to continue to raise capital and we’re going to stay 12-plus months ahead of our spending,”
The electric vehicle start-up is currently expanding a plant in Coolidge, Arizona, and building out a hydrogen fueling infrastructure for fuel cell-powered Class 8 Tre models. Nikola is slowly ramping up battery-electric versions of the Tre and has begun shipping trucks to customers.
Milton is scheduled for trial on federal fraud charges in July and currently holds an 11% stake in Nikola. Milton has sold tens of millions of Nikola shares over the past year, becoming the company’s second-largest individual shareholder after Russell. An increase in authorized shares could dilute his ownership to below 10%.