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Investment in Nikola
3 Months Ended
Aug. 31, 2020
Equity Method Investments And Joint Ventures [Abstract]  
Investment in Nikola

NOTE C – Investment in Nikola

 

On June 3, 2020 (the “Effective Date”), Nikola Corporation (“Nikola”) became a public company through a reverse merger with a subsidiary of VectoIQ Acquisition Corporation, a NASDAQ listed publicly traded company.  At the Effective Date, the Company owned 19,048,020 shares of Nikola common stock.  During the first quarter of fiscal 2021, the Company recognized a $796,141,000 pre-tax gain consisting of $508,511,000 of realized gains from the sale or contribution of 12,000,000 of its Nikola shares, and an unrealized mark-to-market gain of $287,630,000 related to the shares the Company continues to own.  The Company also recognized in operating income $49,511,000 of incremental expenses related to the Nikola gains, $28,858,000 for discretionary profit sharing and bonus expenses and $20,653,000 for the contribution of 500,000 shares of Nikola common stock to the Worthington Industries Foundation to establish a charitable endowment focused on the communities in which it operates.  The 7,048,020 shares of Nikola common stock that the Company continues to own are subject to a lock-up agreement that restricts our ability to sell, transfer or otherwise monetize these shares until early December 2020.  Going forward, the value of these shares will change according to the fluctuations in the market price of the stock and the change in fair value of this investment will be reflected in the statement of earnings as an unrealized gain or loss.