Filed pursuant to Rule 424(b)(3)

Registration No. 333-239940

PROSPECTUS SUPPLEMENT NO. 38

(to Prospectus dated July 27, 2020)

Nikola Corporation

Up to 249,843,711 Shares of Common Stock

This prospectus supplement supplements the prospectus dated July 27, 2020 (the “Prospectus”), which forms a part of our registration statement on Form S-1 (No. 333-239940). This prospectus supplement is being filed to update and supplement the information in the Prospectus with the information contained in Item 5.02 of our Current Report on Form 8-K filed with the Securities and Exchange Commission (“SEC”) on November 3, 2022 (the “Item 5.02 Information ”) and in our Quarterly Report on Form 10-Q, filed with the SEC on November 3, 2022 (the “Quarterly Report”). Accordingly, we have attached the Item 5.02 Information and the Quarterly Report to this prospectus supplement.

The Prospectus and this prospectus supplement relate to the offer and sale from time to time by the selling securityholders named in the Prospectus or their donees, pledgees, transferees or other successors in interest (the “Selling Securityholders”) of up to 249,843,711 shares of our common stock, $0.0001 par value per share (“Common Stock”), which includes (i) up to 6,640,000 shares held by certain persons and entities (the “Original Holders”) holding shares of Common Stock initially purchased by VectoIQ Holdings, LLC (the “Sponsor”) and Cowen Investments II, LLC (“Cowen Investments” and, together with the Sponsor, the “Founders”) in a private placement in connection with the initial public offering of VectoIQ Acquisition Corp. and (ii) 243,203,711 shares held by certain affiliates of the Company. We are registering the shares for resale pursuant to such stockholders’ registration rights under a Registration Rights and Lock-Up Agreement between us and such stockholders, which in addition to such registration rights, also provides for certain transfer and lock-up restrictions on such shares.

Our Common Stock is listed on the Nasdaq Global Select Market under the symbol “NKLA”. On November 2, 2022, the closing price of our Common Stock was $3.30.

This prospectus supplement updates and supplements the information in the Prospectus and is not complete without, and may not be delivered or utilized except in combination with, the Prospectus, including any amendments or supplements thereto. This prospectus supplement should be read in conjunction with the Prospectus and if there is any inconsistency between the information in the Prospectus and this prospectus supplement, you should rely on the information in this prospectus supplement.

See the section entitled “Risk Factors” beginning on page 7 of the Prospectus to read about factors you should consider before buying our securities.

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus supplement or the Prospectus is truthful or complete. Any representation to the contrary is a criminal offense.

The date of this prospectus supplement is November 3, 2022.

Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

On November 2, 2022, the board of directors of the Company (the "Board") appointed Michael Lohscheller Chief Executive Officer in connection with Mark A. Russell's retirement from that position, in each case effective November 3, 2022, as opposed to the previously-announced effective date of January 1, 2023. Mr. Russell continues to serve as a member of the Board.

Mr. Lohscheller, age 53, has served as a member of the Board and as President of the Company since August 9, 2022, and was President of Nikola Motor division from March 2022 until August 9, 2022. Prior to joining the Company, Mr. Lohscheller served as the Global Chief Executive Officer of VinFast LLC, a private automotive manufacturer, from September 2021 to December 2021. Prior to that, from June 2017 to August 2021, Mr. Lohscheller served as Chief Executive Officer and board member at Group PSA of Opel Automobile GmbH, a German automobile manufacturer, and from September 2012 to June 2017, as Chief Financial Officer of Opel Group, General Motors Europe. Mr. Lohscheller served in various capacities at Volkswagen Group of America, a German automobile company, including as Chief Financial Officer from January 2008 to August 2012, and as Director of Group Marketing from 2004 to 2007. From 2001 to 2004, Mr. Lohscheller served as the Chief Financial Officer of Mitsubishi Motors Europe, a Japanese automotive manufacturer.

The appointment of Mr. Lohscheller as Chief Executive Officer was not pursuant to any arrangement or understanding with respect to any other person. There are no family relationships between Mr. Lohscheller and any director or executive officer of the Company, and there are no transactions between Mr. Lohscheller and the Company that would be required to be reported under Item 404(a) of Regulation S-K.

Mr. Russell will receive severance benefits in accordance with the terms of his executive employment agreement.

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2022

OR

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number: 001-38495

Nikola Corporation

(Exact Name of Registrant as Specified in Its Charter)

Delaware	82-4151153
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
4141 E Broadway Road
Phoenix, AZ	85040
(Address of principal executive offices)	(Zip Code)
(480) 666-1038
(Registrant’s telephone number, including area code)
N/A
(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class	Trading Symbol(s)	Name of each exchange on which registered
Common stock, $0.0001 par value per share	NKLA	The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company”, and “emerging growth company” in Rule 12b-2 of the Exchange Act:

Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of October 31, 2022, there were 478,851,041 shares of the registrant’s common stock outstanding.

NIKOLA CORPORATION

CONSOLIDATED FINANCIAL STATEMENTS

TABLE OF CONTENTS

		Page
Summary Risk Factors		1
PART I - FINANCIAL INFORMATION
Item 1.	Financial Statements
	Consolidated Balance Sheets	3
	Consolidated Statements of Operations	4
	Consolidated Statements of Comprehensive Loss	5
	Consolidated Statements of Stockholders’ Equity	6
	Consolidated Statements of Cash Flows	8
	Notes to Consolidated Financial Statements	10
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	34
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	48
Item 4.	Controls and Procedures	48
PART II - OTHER INFORMATION
Item 1.	Legal Proceedings	49
Item 1A.	Risk Factors	49
Item 6.	Exhibits	77
Signatures		79

Summary of Risk Factors

Our business is subject to numerous risks and uncertainties that could affect our ability to successfully implement our business strategy and affect our financial results. You should carefully consider all of the information in this report and, in particular, the following principal risks and all of the other specific factors described in Item 1A. of this report, “Risk Factors,” before deciding whether to invest in our company.

•We are an early stage company with a history of losses, and expect to incur significant expenses and continuing losses for the foreseeable future.

•We may be unable to adequately control the costs associated with our operations.

•Our business model has yet to be tested and any failure to commercialize our strategic plans would have an adverse effect on our operating results and business, harm our reputation and could result in substantial liabilities that exceed our resources.

•Our limited operating history makes evaluating our business and future prospects difficult and may increase the risk of your investment.

•We will need to raise additional funds and these funds may not be available to us when we need them. If we cannot raise additional funds when we need them, our operations and prospects could be negatively affected.

•If we fail to manage our future growth effectively, we may not be able to market and sell our vehicles successfully.

•Our bundled lease model may present unique problems that may have an adverse effect on our operating results and business and harm our reputation.

1

•We may face legal challenges in one or more states attempting to sell directly to customers which could materially adversely affect our costs.

•We face risks and uncertainties related to litigation, regulatory actions and government investigations and inquiries.

•Our success will depend on our ability to economically manufacture our trucks at scale and build our hydrogen fueling stations to meet our customers’ business needs, and our ability to develop and manufacture trucks of sufficient quality and appeal to customers on schedule and at scale is unproven.

•We may experience significant delays in the design, manufacture, launch and financing of our trucks, including in the expansion of our manufacturing plant, which could harm our business and prospects.

•Increases in costs, disruption of supply or shortage of raw materials, including lithium-ion battery cells and packs, chipsets, and displays, could harm our business.

2

PART I - FINANCIAL INFORMATION

Item 1. Financial Statements

NIKOLA CORPORATION

CONSOLIDATED BALANCE SHEETS

(In thousands, except share and per share data)

	September 30,		December 31,
	2022		2021
	(Unaudited)
Assets
Current assets
Cash and cash equivalents	$	315,731	$	497,241
Restricted cash and cash equivalents	600		—
Accounts receivable, net	37,662		—
Inventory	81,069		11,597
Prepaid expenses and other current assets	51,858		15,891
Total current assets	486,920		524,729
Restricted cash and cash equivalents	87,459		25,000
Long-term deposits	37,161		27,620
Property, plant and equipment, net	365,049		244,377
Intangible assets, net	93,609		97,181
Investment in affiliates	76,505		61,778
Goodwill	5,238		5,238
Other assets	7,484		3,896
Total assets	$	1,159,425	$	989,819
Liabilities and stockholders' equity
Current liabilities
Accounts payable	$	92,511	$	86,982
Accrued expenses and other current liabilities	170,707		93,487
Debt and finance lease liabilities, current	14,357		140
Total current liabilities	277,575		180,609
Long-term debt and finance lease liabilities, net of current portion	283,258		25,047
Operating lease liabilities	5,410		2,263
Warrant liability	791		4,284
Other long-term liabilities	28,349		84,033
Deferred tax liabilities, net	13		11
Total liabilities	595,396		296,247
Commitments and contingencies (Note 9)
Stockholders' equity
Preferred stock, $0.0001 par value, 150,000,000 shares authorized, no shares issued and outstanding as of September 30, 2022 and December 31, 2021	—		—
Common stock, $0.0001 par value, 800,000,000 and 600,000,000 shares authorized as of September 30, 2022 and December 31, 2021, respectively, 455,205,699 and 413,340,550 shares issued and outstanding as of September 30, 2022 and December 31, 2021, respectively	46		41
Additional paid-in capital	2,379,191		1,944,341
Accumulated deficit	(1,812,784)		(1,250,612)
Accumulated other comprehensive loss	(2,424)		(198)
Total stockholders' equity	564,029		693,572
Total liabilities and stockholders' equity	$	1,159,425	$	989,819

See accompanying notes to the consolidated financial statements.

3

NIKOLA CORPORATION

CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except share and per share data)

(Unaudited)

	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
Revenues:
Truck sales	$	23,853	$	—	$	41,236	$	—
Service and other	388		—		3,026		—
Total revenues	24,241		—		44,262		—
Cost of revenues:
Truck sales	54,080		—		100,861		—
Service and other	330		—		2,396		—
Total cost of revenues	54,410		—		103,257		—
Gross loss	(30,169)		—		(58,995)		—
Operating expenses:
Research and development	66,683		78,896		204,346		201,785
Selling, general, and administrative	132,865		192,929		289,916		329,028
Total operating expenses	199,548		271,825		494,262		530,813
Loss from operations	(229,717)		(271,825)		(553,257)		(530,813)
Other income (expense):
Interest expense, net	(7,735)		(118)		(10,754)		(219)
Revaluation of warrant liability	586		4,467		3,493		2,907
Other income, net	2,617		1,057		4,423		174
Loss before income taxes and equity in net loss of affiliates	(234,249)		(266,419)		(556,095)		(527,951)
Income tax expense	1		1		3		4
Loss before equity in net loss of affiliates	(234,250)		(266,420)		(556,098)		(527,955)
Equity in net loss of affiliates	(1,984)		(1,147)		(6,074)		(3,067)
Net loss	$	(236,234)	$	(267,567)	$	(562,172)	$	(531,022)
Net loss per share:
Basic	$	(0.54)	$	(0.67)	$	(1.32)	$	(1.34)
Diluted	$	(0.54)	$	(0.68)	$	(1.32)	$	(1.35)
Weighted-average shares outstanding:
Basic	438,416,393		400,219,585		426,382,736		395,691,795
Diluted	438,416,393		400,230,669		426,382,736		395,860,876

See accompanying notes to the consolidated financial statements.

4

NIKOLA CORPORATION

CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

(In thousands)

(Unaudited)

	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
Net loss	$	(236,234)	$	(267,567)	$	(562,172)	$	(531,022)
Other comprehensive loss:
Foreign currency translation adjustment, net of tax	(1,237)		(123)		(2,226)		(358)
Comprehensive loss	$	(237,471)	$	(267,690)	$	(564,398)	$	(531,380)

See accompanying notes to the consolidated financial statements.

5

NIKOLA CORPORATION

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(In thousands, except share data)

(Unaudited)

	Three Months Ended September 30, 2022
	Common Stock			Additional Paid-in Capital		Accumulated Deficit		Accumulated Other Comprehensive Income (Loss)		Total Stockholders' Equity
	Shares	Amount
Balance as of June 30, 2022	433,475,084	$	43	$	2,176,945	$	(1,576,550)	$	(1,187)	$	599,251
Exercise of stock options	1,296,206	1		1,404		—		—		1,405
Issuance of shares for RSU awards	1,425,182	—		—		—		—		—
Common stock issued under Equity Distribution Agreement, net	19,009,227	2		97,997		—		—		97,999
Stock-based compensation	—	—		102,845		—		—		102,845
Net loss	—	—		—		(236,234)		—		(236,234)
Other comprehensive loss	—	—		—		—		(1,237)		(1,237)
Balance as of September 30, 2022	455,205,699	$	46	$	2,379,191	$	(1,812,784)	$	(2,424)	$	564,029

	Nine Months Ended September 30, 2022
	Common Stock			Additional Paid-in Capital		Accumulated Deficit		Accumulated Other Comprehensive Income (Loss)		Total Stockholders' Equity
	Shares	Amount
Balance as of December 31, 2021	413,340,550	$	41	$	1,944,341	$	(1,250,612)	$	(198)	$	693,572
Exercise of stock options	1,581,791	1		1,969		—		—		1,970
Issuance of shares for RSU awards	4,025,887	—		—		—		—		—
Common stock issued under Tumim Purchase Agreements	17,248,244	2		123,670		—		—		123,672
Common stock issued under Equity Distribution Agreement, net	19,009,227	2		97,997		—		—		97,999
Stock-based compensation	—	—		211,214		—		—		211,214
Net loss	—	—		—		(562,172)		—		(562,172)
Other comprehensive loss	—	—		—		—		(2,226)		(2,226)
Balance as of September 30, 2022	455,205,699	$	46	$	2,379,191	$	(1,812,784)	$	(2,424)	$	564,029

See accompanying notes to the consolidated financial statements.

6

	Three Months Ended September 30, 2021
	Common Stock			Additional Paid-in Capital		Accumulated Deficit		Accumulated Other Comprehensive Income (Loss)		Total Stockholders' Equity
	Shares	Amount
Balance as of June 30, 2021	397,077,561	$	40	$	1,668,362	$	(823,629)	$	4	$	844,777
Exercise of stock options	252,442	—		355		—		—		355
Issuance of shares for RSU awards	453,459	—		—		—		—		—
Common stock issued for commitment shares	252,040	—		2,939		—		—		2,939
Reclassification from mezzanine equity to equity after elimination of put right	—	—		5,532		—		—		5,532
Common stock issued under Tumim Purchase Agreements	6,270,740	—		72,866		—		—		72,866
Stock-based compensation	—	—		49,047		—		—		49,047
Net loss	—	—		—		(267,567)		—		(267,567)
Other comprehensive loss	—	—		—		—		(123)		(123)
Balance as of September 30, 2021	404,306,242	$	40	$	1,799,101	$	(1,091,196)	$	(119)	$	707,826

	Nine Months Ended September 30, 2021
	Common Stock			Additional Paid-in Capital		Accumulated Deficit		Accumulated Other Comprehensive Income (Loss)		Total Stockholders' Equity
	Shares	Amount
Balance as of December 31, 2020	391,041,347	$	39	$	1,540,037	$	(560,174)	$	239	$	980,141
Exercise of stock options	3,182,359	1		3,980		—		—		3,981
Issuance of shares for RSU awards	1,721,686	—		—		—		—		—
Common stock issued for commitment shares	407,743	—		5,564		—		—		5,564
Common stock issued for investment in affiliates, net of common stock with embedded put right	1,682,367	—		19,139		—		—		19,139
Reclassification from mezzanine equity to equity after elimination of put right	—	—		5,532		—		—		5,532
Common stock issued under Tumim Purchase Agreements	6,270,740	—		72,866		—		—		72,866
Stock-based compensation	—	—		151,983		—		—		151,983
Net loss	—	—		—		(531,022)		—		(531,022)
Other comprehensive loss	—	—		—		—		(358)		(358)
Balance as of September 30, 2021	404,306,242	$	40	$	1,799,101	$	(1,091,196)	$	(119)	$	707,826

See accompanying notes to the consolidated financial statements.

7

NIKOLA CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)

	Nine Months Ended September 30,
	2022		2021
Cash flows from operating activities
Net loss	$	(562,172)	$	(531,022)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	16,472		5,959
Stock-based compensation	211,214		151,983
Non-cash in-kind services	—		40,230
Equity in net loss of affiliates	6,074		3,067
Revaluation of financial instruments	(94)		(3,226)
Issuance of common stock for commitment shares	—		5,564
Inventory write-downs	16,617		—
Non-cash interest expense	8,890		—
Other non-cash activity	476		1,010
Changes in operating assets and liabilities:
Accounts receivable, net	(37,662)		—
Inventory	(97,952)		(3,644)
Prepaid expenses and other current assets	(10,371)		(7,090)
Accounts payable, accrued expenses and other current liabilities	25,128		147,160
Long-term deposits	(8,356)		(4,705)
Other assets	(912)		—
Operating lease liabilities	(416)		—
Other long-term liabilities	1,605		(655)
Net cash used in operating activities	(431,459)		(195,369)
Cash flows from investing activities
Purchases and deposits of property, plant and equipment	(118,436)		(113,680)
Investments in affiliates	(23,027)		(25,000)
Issuance of senior secured note receivable and prepaid acquisition-related consideration	(21,910)		—
Settlement of Second Price Differential	(6,588)		—
Proceeds from sale of equipment	18		200
Net cash used in investing activities	(169,943)		(138,480)
Cash flows from financing activities
Proceeds from the exercise of stock options	1,645		4,194
Proceeds from issuance of shares under the Tumim Purchase Agreements	123,672		72,866
Proceeds from issuance of Convertible Notes, net of discount and issuance costs	183,504		—
Proceeds from issuance of common stock under Equity Distribution Agreement, net of commissions paid	100,512		—
Proceeds from issuance of Collateralized Promissory Notes	54,000		—
Proceeds from issuance of financing obligation, net of issuance costs	44,007		—
Proceeds from insurance premium financing	6,637		—
Repayment of debt and notes	(28,125)		(4,100)
Payments on insurance premium financing	(2,635)		—
Payments on finance lease liabilities and financing obligation	(266)		(759)
Payments for issuance costs	—		(644)
Net cash provided by financing activities	482,951		71,557
Net decrease in cash and cash equivalents, including restricted cash	(118,451)		(262,292)
Cash and cash equivalents, including restricted cash, beginning of period	522,241		849,278
Cash and cash equivalents, including restricted cash, end of period	$	403,790	$	586,986

See accompanying notes to the consolidated financial statements.

8

Supplementary cash flow disclosures:
Cash paid for interest	$	2,643	$	573
Cash interest received	$	257	$	456
Supplementary disclosures for noncash investing and financing activities:
Purchases of property, plant and equipment included in liabilities	$	28,912	$	21,001
Accrued paid in kind interest	$	7,284	$	—
Accrued commissions under Equity Distribution Agreement	$	2,513	$	—
Embedded derivative asset bifurcated from Convertible Notes	$	1,500	$	—
Stock option proceeds receivable	$	325	$	—
Accrued debt issuance costs	$	311	$	—
Accrued deferred issuance costs	$	—	$	439
Leased assets obtained in exchange for new finance lease liabilities	$	698	$	11,125
Common stock issued for commitment shares	$	—	$	5,564
Common stock issued for investments in affiliates, including common stock with embedded put right	$	—	$	32,376
Acquired intangible assets included in liabilities	$	—	$	47,181

See accompanying notes to the consolidated financial statements.

9

NIKOLA CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

1.BASIS OF PRESENTATION

(a)Overview

Nikola Corporation (‘‘Nikola’’ or the ‘‘Company’’) is a designer and manufacturer of heavy-duty commercial battery-electric and hydrogen-electric vehicles and energy infrastructure solutions.

(b)Unaudited Consolidated Financial Statements

The accompanying unaudited consolidated financial statements have been prepared in accordance with U.S. Generally Accepted Accounting Principles (“GAAP”) and pursuant to the regulations of the U.S. Securities and Exchange Commission (“SEC”). The unaudited financial information reflects, in the opinion of management, all adjustments, consisting of normal recurring adjustments, considered necessary for a fair statement of the Company's financial position, results of operations and cash flows for the periods indicated. The results reported for the interim period presented are not necessarily indicative of results that may be expected for the full year. These consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company's Annual Report on Form 10-K for the year ended December 31, 2021.

The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. Intercompany accounts and transactions have been eliminated.

Certain prior period balances have been reclassified to conform to the current period presentation in the consolidated financial statements and the accompanying notes. All dollar amounts are in thousands, unless otherwise noted.

Prior to the start of production for the Tre battery-electric vehicle ("BEV") trucks late in the first quarter of 2022, pre-production activities, including manufacturing readiness, process validation, prototype builds, freight, inventory write-downs, and operations of the Company's manufacturing facility in Coolidge, Arizona were recorded as research and development activities on the Company's consolidated statements of operations. Commensurate with the start of production, manufacturing costs, including labor and overhead, as well as inventory-related expenses related to the Tre BEV trucks, and related facility costs, are recorded in cost of revenues beginning in the second quarter of 2022.

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results could differ from those estimates.

(c)Funding Risks and Going Concern

As an early stage growth company, the Company's ability to access capital is critical. Until the Company can generate sufficient revenue to cover its operating expenses, working capital and capital expenditures, the Company will need to raise additional capital.

Additional stock financing may not be available on favorable terms and could be dilutive to current stockholders. Debt financing, if available, may involve restrictive covenants and dilutive financing instruments.

The Company’s ability to access capital when needed is not assured and, if capital is not available to the Company when, and in the amounts needed, the Company could be required to delay, scale back, or abandon some or all of its development programs and other operations, which could materially harm the Company’s business, financial condition and results of operations.

These financial statements have been prepared by management in accordance with GAAP and this basis assumes that the Company will continue as a going concern, which contemplates the realization of assets and the satisfaction of liabilities and commitments in the normal course of business. These financial statements do not include any adjustments that may result from the outcome of this uncertainty.

As of the date of this Quarterly Report on Form 10-Q, the Company’s existing cash resources and existing borrowing availability are sufficient to support planned operations for the next 12 months. As a result, management believes that the Company's existing financial resources are sufficient to continue operating activities for at least one year past the issuance date of the financial statements.

10

NIKOLA CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

2.SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

(a)Cash, Cash Equivalents and Restricted Cash and Cash Equivalents

The Company considers investments in money market funds with a floating net asset value to be cash equivalents. As of September 30, 2022 and December 31, 2021, the Company had $315.7 million and $497.2 million of cash and cash equivalents, which included cash equivalents of zero and $463.9 million of highly liquid investments as of September 30, 2022 and December 31, 2021, respectively.

As of September 30, 2022 and December 31, 2021, the Company had $88.1 million and $25.0 million, respectively, in current and non-current restricted cash. Restricted cash represents cash that is restricted as to withdrawal or usage and consists of securitization of the Company's letters of credit, leases, and debt. See Note 5, Debt and Finance Lease Liabilities, for additional details.

The reconciliation of cash and cash equivalents and restricted cash and cash equivalents to amounts presented in the consolidated statements of cash flows are as follows:

	As of
	September 30, 2022		December 31, 2021		September 30, 2021
Cash and cash equivalents	$	315,731	$	497,241	$	586,986
Restricted cash and cash equivalents – current	600		—		—
Restricted cash and cash equivalents – non-current	87,459		25,000		—
Cash, cash equivalents and restricted cash and cash equivalents	$	403,790	$	522,241	$	586,986

(b)Accounts Receivable, net

Accounts receivable, net, are reported at the invoiced amount, less an allowance for potential uncollectible amounts. The Company had no allowance for uncollectible amounts as of September 30, 2022 and December 31, 2021.

(c)Fair Value of Financial Instruments

The carrying value and fair value of the Company’s financial instruments are as follows:

	As of September 30, 2022
	Level 1		Level 2		Level 3		Total
Assets
Derivative asset	$	—	$	—	$	500	$	500
Senior secured note receivable	—		—		10,081		10,081
Liabilities
Warrant liability	$	—	$	—	$	791	$	791

	As of December 31, 2021
	Level 1		Level 2		Level 3		Total
Assets
Cash equivalents – money market	$	463,867	$	—	$	—	$	463,867
Liabilities
Warrant liability	$	—	$	—	$	4,284	$	4,284
Derivative liability	—		—		4,189		4,189

11

NIKOLA CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

Warrant liability

As a result of the Company's business combination with VectoIQ Acquisition Corp. ("VectoIQ") in June 2020 (the "Business Combination"), the Company assumed a warrant liability (the "Warrant Liability") related to previously issued private warrants in connection with VectoIQ's initial public offering. The Warrant Liability is remeasured to its fair value at each reporting period and upon settlement. The change in fair value was recognized in revaluation of warrant liability on the consolidated statements of operations. The change in fair value of the Warrant Liability was as follows:

	Warrant Liability
Estimated fair value at December 31, 2021	$	4,284
Change in estimated fair value	(3,493)
Estimated fair value at September 30, 2022	$	791

The fair value of the warrants outstanding was estimated using the Black-Scholes model. The application of the Black-Scholes model requires the use of a number of inputs and significant assumptions including volatility. The following reflects the inputs and assumptions used:

	As of
	September 30, 2022			December 31, 2021
Stock price	$	3.52		$	9.87
Exercise price	$	11.50		$	11.50
Remaining term (in years)	2.68			3.42
Volatility	90		%	90		%
Risk-free rate	4.24		%	1.03		%
Expected dividend yield	—		%	—		%

Put Right and Price Differential derivative liabilities

On June 22, 2021 (the "WVR Closing Date"), the Company entered into a Membership Interests Purchase Agreement (the “Original MIPA”) with Wabash Valley Resources LLC (“WVR”) and the sellers party thereto (collectively, the “Sellers”), pursuant to which, the Company purchased a 20% equity interest in WVR in exchange for cash and shares of the Company’s common stock (see Note 4, Investments). Under the Original MIPA, each Seller had a right but not the obligation, in its sole discretion, to cause the Company to purchase a portion of such Seller’s Shares outside the specified blackout windows, at $14.86 per share of common stock (the "Put Right") with a maximum share repurchase of $10.0 million in aggregate. On the WVR Closing Date, the maximum potential cash settlement from the shares of common stock subject to the Put Right and the fair value of the embedded Put Right was recorded in temporary equity. The fair value of the Put Right was $3.2 million as of the WVR Closing Date.

On September 13, 2021, the Company entered into an Amended Membership Interest Purchase Agreement (the "Amended MIPA") with WVR and the Sellers, pursuant to which the Put Right was removed in its entirety and replaced with the first price differential and second price differential (together the "Price Differential"). As a result of the Amended MIPA, the shares of common stock with the embedded Put Right were deemed modified and $13.2 million was reclassified from temporary equity to equity on the consolidated balance sheets. The Price Differential was a freestanding financial instrument and accounted for as a derivative liability. The fair value of the Price Differential upon modification was $7.7 million and recognized as a derivative liability, resulting in a net impact of $5.5 million to equity during the third quarter of 2021.

Pursuant to the terms of the Amended MIPA, the first price differential was settled in the fourth quarter of 2021 for $3.4 million and the second price differential was settled in the third quarter of 2022 for $6.6 million, eliminating the Company's derivative liability balance as of September 30, 2022.

The derivative liability was remeasured at each reporting period with changes in its fair value recorded in other income, net on the consolidated statements of operations. The change in fair value of the derivative liability was as follows:

12

NIKOLA CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

	Derivative Liability
Estimated fair value at December 31, 2021	$	4,189
Change in estimated fair value	2,399
Settlement of second price differential	(6,588)
Fair value at September 30, 2022	$	—

The fair value of the derivative liability, a level 3 measurement, was estimated using a Monte Carlo simulation model as of December 31, 2021. The application of the Monte Carlo simulation model requires the use of a number of inputs and significant assumptions including volatility. The following reflects the inputs and assumptions used:

	As of
	December 31, 2021
Stock price	$	9.87
Strike price	$	14.86
Volatility	100		%
Risk-free rate	0.18		%

Put Premium derivative asset

In June 2022, the Company completed a private placement of $200 million aggregate principal amount of unsecured 8.00% / 11.00% convertible senior paid in kind ("PIK") toggle notes (the “Convertible Notes”). In conjunction with the issuance of the Convertible Notes, the Company entered into a premium letter agreement (the "Put Premium") with the purchasers (the "Note Purchasers") of the Convertible Notes which requires the Note Purchasers to pay $9.0 million to the Company if during the period through the date that is thirty months after the closing date of the private placement of Convertible Notes, the last reported sale price of the Company's common stock has been at least $20.00 for at least 20 trading days during any consecutive 40 trading day periods.

The Put Premium is an embedded derivative asset and meets the criteria to be separated from the host contract and carried at fair value. The derivative is measured both initially and in subsequent periods at fair value, with changes in fair value recognized in other income, net on the consolidated statements of operations. The fair value of the derivative asset is included in other assets on the consolidated balance sheets. The change in fair value of the derivative asset was as follows:

	Derivative asset
Estimated fair value as of June 1, 2022	$	1,500
Change in estimated fair value	(1,000)
Estimated fair value as of September 30, 2022	$	500

The fair value of the derivative asset, a level 3 measurement, was estimated using a Monte Carlo simulation model. The application of the Monte Carlo simulation model requires the use of a number of inputs and significant assumptions including volatility. The following reflects the inputs and assumptions used:

	As of
	September 30, 2022			June 1, 2022
Stock price	$	3.52		$	6.77
Threshold price	$	20.00		$	20.00
Remaining term (in years)	2.17			2.50
Volatility	100		%	90		%
Risk-free rate	4.18		%	2.73		%
Payer cost of debt	6.25		%	4.30		%

13

NIKOLA CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

Senior secured note receivable

The Company entered into an Agreement and Plan of Merger and Reorganization dated July 30, 2022 (the "Merger Agreement") with Romeo Power, Inc. ("Romeo") and J Purchaser Corp (“Purchaser”), a wholly-owned subsidiary of the Company. Concurrently with the execution of the Merger Agreement, Romeo and Romeo Systems, Inc., a Delaware corporation and a wholly-owned subsidiary of Romeo (“Romeo Systems”), entered into a Loan and Security Agreement (the “Loan Agreement”) with the Company as the lender. The Loan Agreement provides for a liquidity support senior secured debt facility (the “Facility”) in an aggregate principal amount of up to $30.0 million (subject to certain incremental increases of up to $20.0 million), which shall be available for drawing subject to certain terms and conditions set forth in the Loan Agreement. As of September 30, 2022, the Company issued $10.0 million to Romeo under the terms of the Loan Agreement. The Company elected to account for the senior secured note receivable pursuant to the fair value option under ASC 825. As of September 30, 2022, the fair value of the senior secured note receivable was $10.1 million, based on the recent transaction price.

(d)Revenue Recognition

Truck sales

Truck sales consist of revenue recognized on the sales of the Company's BEV trucks. The sale of a truck is recognized as a single performance obligation at the point in time when control is transferred to the customer (dealers). Control is deemed transferred when the product is picked up by the carrier and the customer (dealer) can direct the product's use and obtain substantially all of the remaining benefits from the product. The Company does not offer returns on truck sales.

Payment for trucks sold are made in accordance with the Company's customary payment terms. The Company has elected an accounting policy whereby the Company does not adjust the promised amount of consideration for the effects of a significant financing component because, at contract inception, the Company expects the period between the time when the Company transfers a promised good or service to the customer and the time when the customer pays for that good or service will be one year or less. Sales tax collected from customers is not considered revenue and is accrued until remitted to the taxing authorities. Shipping and handling activities occur after the customer has obtained control of the product, thus the Company has elected to account for those expenses as fulfillment costs in cost of revenues, rather than an additional promised service.

Services and other

Services and other revenues consist of sales of mobile charging trailers ("MCTs"). The sale of MCTs is recognized as a single performance obligation at the point in time when control is transferred to the customer. Control is deemed transferred when the product is delivered to the customer and the customer can direct the product's use and obtain substantially all of the remaining benefits from the asset. The Company does not offer sales returns on MCTs. Payment for products sold are made in accordance with the Company's customary payment terms and the Company's MCT contracts do not have significant financing components. The Company has elected to exclude sales taxes from the measurement of the transaction price.

(e)Warranties

Warranty costs are recognized upon transfer of control of trucks to dealers, and are estimated based on factors including the length of the warranty, product costs, supplier warranties, and product failure rates. Warranty reserves are reviewed and adjusted quarterly to ensure that accruals are adequate to meet expected future warranty obligations. Initial

14

NIKOLA CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

warranty data is limited early in the launch of a new product and accordingly, future adjustments to the warranty accrual may be material.

The change in warranty liability for the three and nine months ended September 30, 2022 is summarized as follows:

	Three Months Ended		Nine Months Ended
	September 30, 2022		September 30, 2022
Accrued warranty - beginning of period	$	2,203	$	—
Warranty costs incurred	(200)		(200)
Net changes in liability for pre-existing warranties	(213)		—
Provision for new warranties	2,611		4,601
Accrued warranty - end of period	$	4,401	$	4,401

As of September 30, 2022, warranty accrual for $1.1 million is recorded in accrued expenses and other current liabilities and $3.3 million in other long-term liabilities on the consolidated balance sheets.

(f)Recent Accounting Pronouncements

Recently issued accounting pronouncements not yet adopted

In November 2021, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2021-10, Government Assistance, to increase transparency of government assistance which requires annual disclosures about transactions with a government entity that are accounted for by applying a grant or contribution accounting model by analogy. ASU 2021-10 is effective for annual periods beginning after December 15, 2021 and early adoption is permitted. The Company will adopt ASU 2021-10 for the year ended December 31, 2022, which will have an immaterial impact to the Company's consolidated financial statements.

3.BALANCE SHEET COMPONENTS

Inventory

Inventory consisted of the following at September 30, 2022 and December 31, 2021, respectively:

	As of
	September 30, 2022		December 31, 2021
Raw materials	$	63,398	$	7,344
Work in process	5,547		4,253
Finished goods	10,935		—
Service parts	1,189		—
Total inventory	$	81,069	$	11,597

Inventory cost is computed using standard cost, which approximates actual cost on a first-in, first-out basis. Inventories are stated at the lower of cost or net realizable value. Inventories are written down for any excess or obsolescence and when net realizable value, which is based upon estimated selling prices, is in excess of carrying value. Once inventory is written-down, a new, lower cost basis for that inventory is established and subsequent changes in facts and circumstances do not result in the restoration of or increase in that newly established cost basis.

15

NIKOLA CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

Prepaid Expenses and Other Current Assets

Prepaid expenses and other current assets consisted of the following at September 30, 2022 and December 31, 2021, respectively:

	As of
	September 30, 2022		December 31, 2021
Prepaid acquisition-related consideration	$	11,910	$	—
Prepaid expenses	11,750		5,116
Senior secured note receivable	10,081		—
Non-trade receivables	7,206		2,717
HQ Sale Agreement receivable	4,528		—
Deposits	4,204		5,615
Deferred implementation costs	2,179		2,443
Total prepaid expenses and other current assets	$	51,858	$	15,891

Prepaid acquisition-related consideration

As part of the Loan Agreement entered into with Romeo, the Company agreed to a short-term battery price increase which will be considered part of the merger consideration upon closing of the transaction.

Deferred implementation costs

Deferred implementation costs are amortized on a straight-line basis over the estimated useful life of the related software. During the second quarter of 2022, the Company re-assessed the estimated useful life of its existing enterprise resource planning system as a result of ongoing re-implementation, resulting in a shorter useful life and prospective change in amortization.

The Company recorded $1.2 million and $2.4 million of amortization expense on the consolidated statements of operations for the three and nine months ended September 30, 2022, respectively, related to deferred implementation costs. Amortization during the three and nine months ended September 30, 2021 was immaterial.

16

NIKOLA CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

Property, Plant and Equipment, Net

Property, plant and equipment, net consisted of the following at September 30, 2022 and December 31, 2021:

	As of
	September 30, 2022		December 31, 2021
Construction-in-progress	$	161,798	$	103,515
Buildings	127,797		104,333
Machinery and equipment	51,178		36,551
Land	20,762		15
Demo vehicles	12,751		888
Software	8,449		7,562
Other	3,473		3,011
Leasehold improvements	2,953		2,883
Furniture and fixtures	1,492		1,480
Finance lease assets	1,338		646
Property, plant and equipment, gross	391,991		260,884
Less: accumulated depreciation and amortization	(26,942)		(16,507)
Total property, plant and equipment, net	$	365,049	$	244,377

Construction-in-progress on the Company's consolidated balance sheets as of September 30, 2022 relates primarily to the expansion of the Company's manufacturing plant in Coolidge, Arizona, development of hydrogen infrastructure, and build-out of the Company's headquarters and R&D facility in Phoenix, Arizona.

Depreciation expense for the three months ended September 30, 2022 and 2021 was $3.9 million and $2.2 million, respectively. Depreciation expense for the nine months ended September 30, 2022 and 2021 was $10.5 million and $5.9 million, respectively.

Accrued Expenses and Other Current Liabilities

Accrued expenses and other current liabilities consisted of the following at September 30, 2022 and December 31, 2021:

	As of
	September 30, 2022		December 31, 2021
Settlement liability	$	70,000	$	50,000
Accrued purchase of intangible asset	29,398		11,344
Other accrued expenses	20,318		8,699
Inventory received not yet invoiced	19,017		8,253
Accrued legal expenses	17,784		5,664
Accrued payroll and payroll related expenses	7,570		2,521
Accrued purchases of property, plant and equipment	6,620		2,817
Derivative liability	—		4,189
Total accrued expenses and other current liabilities	$	170,707	$	93,487

17

NIKOLA CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

4. INVESTMENTS IN AFFILIATES

Investments in unconsolidated affiliates accounted for under the equity method consist of the following:

			As of
	Ownership		September 30, 2022		December 31, 2021
Nikola Iveco Europe GmbH	50	%	$	17,636	$	4,083
Wabash Valley Resources LLC	20	%	57,869		57,695
Nikola - TA HRS 1, LLC	50	%	1,000		—
			$	76,505	$	61,778

Equity in net loss of affiliates on the consolidated statements of operations for the three and nine months ended September 30, 2022 and 2021, were as follows:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
Equity in net loss of affiliates:
Nikola Iveco Europe GmbH	$	(1,959)	$	(1,359)	$	(5,998)	$	(3,279)
Wabash Valley Resources LLC	(25)		212		(76)		212
Total equity in net loss of affiliates	$	(1,984)	$	(1,147)	$	(6,074)	$	(3,067)

Nikola Iveco Europe GmbH

In April 2020, the Company and Iveco established a joint venture in Europe, Nikola Iveco Europe GmbH. The operations of the joint venture are located in Ulm, Germany, and consist of manufacturing the BEV and FCEV Class 8 trucks for the European and North American markets. In June 2022, the Company and Iveco executed amended agreements to expand the scope of the joint venture operations to include engineering and development of the Nikola Tre BEV European platform.

The agreements provide for a 50/50 ownership of the joint venture and a 50/50 allocation of the joint venture's production volumes and profits between the Company and Iveco. Nikola Iveco Europe GmbH is considered a variable interest entity ("VIE") due to insufficient equity to finance its activities without additional subordinated financial support. The Company is not considered the primary beneficiary as it does not have the power to direct the activities that most significantly impact the economic performance based on the terms of the agreements. Accordingly, the VIE is accounted for under the equity method..

During the first quarter of 2022, the Company made a contribution to Nikola Iveco Europe GmbH of €3.0 million (approximately $3.3 million). During the second quarter of 2022, the Company made an additional contribution of €17.0 million (approximately $18.4 million). As of September 30, 2022, the Company's maximum exposure to loss was $27.9 million, which represents the book value of the Company's equity interest and guaranteed debt obligations of $10.3 million.

Wabash Valley Resources LLC

On June 22, 2021, the Company entered into the Original MIPA with WVR and the Sellers, pursuant to which, the Company purchased a 20% equity interest in WVR in exchange for $25.0 million in cash and 1,682,367 shares of the Company’s common stock. WVR is developing a clean hydrogen project in West Terre Haute, Indiana, including a hydrogen production facility. The common stock consideration was calculated based on the 30-day average closing stock price of the Company, or $14.86 per share, and the Company issued 1,682,367 shares of its common stock.

The Company's interest in WVR is accounted for under the equity method and is included in investment in affiliates on the Company's consolidated balance sheets. Included in the initial carrying value was a basis difference of $55.5 million due to the difference between the cost of the investment and the Company's proportionate share of WVR's net assets. The basis difference is primarily comprised of property, plant and equipment and intangible assets.

As of September 30, 2022, the Company's maximum exposure to loss was $58.1 million, which represents the book value of the Company's equity interest and a loan to WVR during the second quarter of 2022 for $0.3 million.

18

NIKOLA CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

Nikola - TA HRS 1, LLC

In March 2022, the Company and Travel Centers of America, Inc. ("TA") entered into a series of agreements which established a joint venture, Nikola - TA HRS 1, LLC. The operations expected to be performed by the joint venture consist of the development, operation and maintenance of a hydrogen fueling station. Operations have not commenced as of September 30, 2022.

The agreements provide for 50/50 ownership of the joint venture. Both parties are entitled to appoint an equal number of board members to the management committee of the joint venture. Pursuant to the terms of the agreements, the Company contributed $1.0 million to Nikola - TA HRS 1, LLC during the second quarter of 2022.

Nikola - TA HRS 1, LLC is considered a VIE due to insufficient equity to finance its activities without additional subordinated financial support. The Company is not considered the primary beneficiary as it does not have the power to direct the activities that most significantly impact the economic performance based on the terms of the agreements. Accordingly, the VIE is accounted for under the equity method.

The Company does not guarantee debt for, or have other financial support obligations to the entity and its maximum exposure to loss in connection with its continuing involvement with the entity is limited to the carrying value of the investment.

5. DEBT AND FINANCE LEASE LIABILITIES

Debt and finance lease liabilities as of September 30, 2022 and December 31, 2021, were as follows:

	As of
	September 30, 2022		December 31, 2021
Current:
Promissory notes	$	10,000	$	—
Insurance premium financing	4,002		—
Finance lease liabilities	355		140
Debt and finance lease liabilities, current	$	14,357	$	140
Non-current:
Convertible Notes	$	193,205	$	—
Financing obligation	48,558		—
Promissory notes	40,876		24,639
Finance lease liabilities	619		408
Long-term debt and finance lease liabilities, net of current portion	$	283,258	$	25,047

The fair value of debt obligations are estimated using level 2 fair value inputs, including stock price and risk-free rates. The following table presents the carrying value and estimated fair values:

	As of September 30, 2022
	Carrying Value		Fair Value
Convertible Notes	$	193,205	$	185,788
Collateralized Note	46,987		45,652
Second Collateralized Note	3,888		3,792

Convertible Notes

In June 2022, the Company completed a private placement of $200.0 million aggregate principal amount of unsecured 8.00% / 11.00% convertible senior PIK toggle notes, which will mature on May 31, 2026. The Convertible Notes were issued pursuant to an indenture, dated as of June 1, 2022 (the "Indenture").

19

NIKOLA CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

The Convertible Notes bear interest at 8.00% per annum, to the extent paid in cash (“Cash Interest”), and 11.00% per annum, to the extent paid in kind through the issuance of additional Convertible Notes (“PIK Interest”). Interest is payable semi-annually in arrears on May 31 and November 30 of each year, beginning on November 30, 2022. The Company can elect to make any interest payment through Cash Interest, PIK Interest or any combination thereof.

Based on the applicable conversion rate, the Convertible Notes plus any accrued and unpaid interest are convertible into cash, shares of the Company’s common stock or a combination thereof, at the Company’s election. The initial conversion rate is 114.3602 shares per $1,000 principal amount of the Convertible Notes, subject to customary anti-dilution adjustment in certain circumstances, which represented an initial conversion price of approximately $8.74 per share.

Prior to February 28, 2026, the Convertible Notes will be convertible at the option of the holders only upon the occurrence of specified events and during certain periods, and will be convertible on or after February 28, 2026, at any time until the close of business on the second scheduled trading day immediately preceding the maturity date of the Convertible Notes.

Holders of the Convertible Notes will have the right to convert all or a portion of their Convertible Notes prior to the close of business on the business day immediately preceding February 28, 2026 only under the following circumstances: (i) during any fiscal quarter commencing after the fiscal quarter ending on September 30, 2022 (and only during such fiscal quarter), if the last reported sale price of the Common Stock for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding fiscal quarter is greater than or equal to 130% of the conversion price for the Convertible Notes on each applicable trading day; (ii) during the five business day period after any ten consecutive trading day period in which the trading price per $1,000 principal amount of the Convertible Notes for each trading day of that ten consecutive trading day period was less than 98% of the product of the last reported sale price of the Common Stock and the conversion rate of the Convertible Notes on each such trading day; (iii) if the Company calls such Convertible Notes for redemption, at any time prior to the close of business on the second business day immediately preceding the redemption date; or (iv) upon the occurrence of specified corporate events.

The Company may not redeem the Convertible Notes prior to the third anniversary of the date of initial issuance of the Convertible Notes. The Company may redeem the Convertible Notes in whole or in part, at its option, on or after such date and prior to the 26th scheduled trading day immediately preceding the maturity date, for a cash purchase price equal to the aggregate principal amount of any Convertible Notes to be redeemed plus accrued and unpaid interest.

In addition, following certain corporate events that occur prior to the maturity date or following issuance by the Company of a notice of redemption, in each case as provided in the Indenture, in certain circumstances, the Company will increase the conversion rate for a holder who elects to convert its Convertible Notes in connection with such a corporate event or who elects to convert any Convertible Notes called for redemption during the related redemption period. Additionally, in the event of a fundamental change or a change in control transaction (each such term as defined in the Indenture), holders of the Convertible Notes will have the right to require the Company to repurchase all or a portion of their Convertible Notes at a price equal to 100% of the capitalized principal amount of Convertible Notes, in the case of a fundamental change, or 130% of the capitalized principal amount of Convertible Notes, in the case of change in control transactions, in each case plus any accrued and unpaid interest to, but excluding, the repurchase date.

The Indenture includes restrictive covenants that, subject to specified exceptions, limit the ability of the Company and its subsidiaries to incur secured debt in excess of $500.0 million, incur other subsidiary guarantees, and sell equity interests of any subsidiary that guarantees the Convertible Notes. In addition, the Indenture includes customary terms and covenants, including certain events of default after which the holders may accelerate the maturity of the Convertible Notes and become due and payable immediately.

In conjunction with the issuance of the Convertible Notes, the Company executed the Put Premium which was determined to be an embedded derivative that met the criteria for bifurcation from the host. The total proceeds received were first allocated to the fair value of the bifurcated derivative asset, and the remaining proceeds allocated to the host resulting in an adjustment to the initial purchasers' debt discount.

The net proceeds from the sale of the Convertible Notes were $183.2 million, net of initial purchasers' discounts and debt issuance costs. Unamortized debt discount and issuance costs are reported as a direct deduction from the face amount of the Convertible Notes.

20

NIKOLA CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

The net carrying amounts of the debt component of the Convertible Notes were as follows:

	As of
	September 30, 2022
Principal amount	$	200,000
Accrued PIK interest	7,284
Unamortized discount	(6,898)
Unamortized issuance costs	(7,181)
Net carrying amount	$	193,205

As of September 30, 2022, the effective interest rate on the Convertible Notes was 12.99%. Amortization of the debt discount and issuance costs is reported as a component of interest expense and is computed using the straight-line method over the term of the Convertible Notes, which approximates the effective interest method. The following table presents the Company's interest expense related to convertible debt:

	Three Months Ended September 30,		Nine Months Ended September 30,
	2022		2022
Contractual interest expense	$	5,500	$	7,284
Amortization of debt discount and issuance costs	922		1,228
Total interest expense	$	6,422	$	8,512

Financing Obligation

On May 10, 2022 (the "Sale Date"), the Company entered into a sale agreement (the "Sale Agreement"), pursuant to which the Company sold the land and property related to the Company's headquarters in Phoenix, Arizona for a purchase price of $52.5 million. As of the Sale Date, $13.1 million was withheld from the proceeds received related to portions of the headquarters currently under construction. The Company will receive the remaining proceeds throughout the completion of construction pursuant to the terms of the Sale Agreement. Concurrent with the sale, the Company entered into a lease agreement (the "Lease Agreement"), whereby the Company leased back the land and property related to the headquarters for an initial term of 20 years with four extension options for 7 years each. As of the Sale Date, the Company considered one extension option reasonably certain of being exercised.

The buyer is not considered to have obtained control of the headquarters because the lease is classified as a finance lease. Accordingly, the sale of the headquarters is not recognized and the property and land continue to be recognized on the Company's consolidated balance sheets. As of the Sale Date, the Company recorded $38.3 million as a financing obligation on the Company's consolidated balance sheets representing proceeds received net of debt issuance costs of $1.1 million. Rent payments under the terms of the Lease Agreement will be allocated between interest expense and principal repayments using the effective interest method. Additionally, debt issuance costs will be amortized to interest expense over the lease term.

After the Sale Date and through September 30, 2022, the Company recognized an additional $10.3 million for financing obligations on the Company's consolidated balance sheets for construction completed after the Sale Date. As of September 30, 2022, the Company has recognized a HQ Sale Agreement receivable of $4.5 million for funds not yet received for construction completed in prepaid expenses and other current assets. Additionally, for the three and nine months ended September 30, 2022, the Company recognized $0.9 million and $1.4 million, respectively, of interest expense related to interest on the financing obligation and amortization of debt issuance costs.

Promissory Notes

On May 10, 2022, and in connection with the execution of the sale and leaseback of the Company's headquarters, the Company repaid the $25.0 million promissory note that was executed in conjunction with the Company purchasing its headquarters in the fourth quarter of 2021 (the "Promissory Note").

21

NIKOLA CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

For the nine months ended September 30, 2022, the Company recognized $0.4 million of interest expense related to interest on the Promissory Note and amortization of debt issuance costs prior to redemption. During the second quarter of 2022, the Company expensed $0.3 million of unamortized debt issuance costs related to the Promissory Note.

Collateralized Promissory Notes

On June 7, 2022, the Company executed a promissory note and a master security agreement (the "Master Security Agreement") for $50.0 million at a stated interest rate of 4.26% (the "Collateralized Note"). The Collateralized Note is fully collateralized by certain personal property assets as fully described in the Master Security Agreement. Additionally, in connection with the Collateralized Note, the Company executed a pledge agreement pursuant to which the Company pledged $50.0 million in cash as additional collateral in order to obtain a more favorable interest rate. The amount pledged is recorded in "Restricted cash and cash equivalents" as of September 30, 2022. The Collateralized Note carries a 60 month term and is payable in 60 equal consecutive monthly installments due in arrears.

For the three and nine months ended September 30, 2022, the Company recognized $0.5 million and $0.7 million, respectively, of interest expense on the Collateralized Note.

On August 4, 2022, the Company executed a promissory note and a security agreement for $4.0 million at an implied interest rate of 7.00% (the "Second Collateralized Note"). The Second Collateralized Note is fully collateralized by certain personal property assets as fully described in the security agreement. The Second Collateralized Note carries a 60 month term and is payable in 60 equal monthly installments due in arrears.

For the three months ended September 30, 2022, interest expense related to the Second Collateralized Note was immaterial.

Insurance Premium Financing

The Company executed an insurance premium financing agreement pursuant to which the Company financed certain annual insurance premiums for $6.6 million, primarily consisting of premiums for directors' and officers' insurance. The insurance premium payable incurs interest at 2.95%, and is due in monthly installments maturing on March 27, 2023.

For the three months ended September 30, 2022, interest expense on the insurance premium financing was immaterial.

Letters of Credit

During the third quarter of 2022, the Company executed a $0.6 million letter of credit to secure a customs bond through August 31, 2023. As of September 30, 2022, no amounts have been drawn on the letter of credit.

During the second quarter of 2022, and in conjunction with the execution of the Lease Agreement, the Company executed an irrevocable standby letter of credit for $12.5 million to collateralize the Company's lease obligation. The letter of credit is subject to annual increases commensurate with base rent increases pursuant to the Lease Agreement. The letter of credit will expire upon the expiration of the Lease Agreement, but may be subject to reduction or early termination upon the satisfaction of certain conditions as described in the Lease Agreement.

During the fourth quarter of 2021, the Company executed an irrevocable standby letter of credit for $25.0 million through December 31, 2024 in connection with the execution of a product supply agreement with a vendor. As of September 30, 2022, no amounts have been drawn on the letter of credit.

22

NIKOLA CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

6. CAPITAL STRUCTURE

Shares Authorized

As of September 30, 2022, the Company had a total of 950,000,000 shares authorized for issuance consisting of 800,000,000 shares designated as common stock and 150,000,000 shares designated as preferred stock.

Warrants

As of September 30, 2022, the Company had 760,915 private warrants outstanding. Each private warrant entitles the registered holder to purchase one share of common stock at a price of $11.50 per share, subject to adjustment, at any time commencing 30 days after the completion of the Business Combination. For the three months ended September 30, 2022 and 2021, the Company recorded gains of $0.6 million and $4.5 million, respectively, for revaluation of warrant liability on the consolidated statements of operations. For the nine months ended September 30, 2022 and 2021, the Company recorded gains of $3.5 million and $2.9 million, respectively, for revaluation of warrant liability on the consolidated statements of operations. As of September 30, 2022 and December 31, 2021, the Company had $0.8 million and $4.3 million, respectively, for warrant liability related to the private warrants outstanding on the consolidated balance sheets.

The exercise price and number of shares of common stock issuable upon exercise of the private warrants may be adjusted in certain circumstances including in the event of a share dividend, or recapitalization, reorganization, merger or consolidation. However, the private warrants will not be adjusted for issuance of common stock at a price below their exercise price.

Stock Purchase Agreements

First Purchase Agreement with Tumim Stone Capital LLC

On June 11, 2021, the Company entered into a common stock purchase agreement (the "First Tumim Purchase Agreement") and a registration rights agreement (the "Registration Rights Agreement") with Tumim Stone Capital LLC ("Tumim"), pursuant to which Tumim committed to purchase up to $300.0 million in shares of the Company's common stock, subject to certain limitations and conditions set forth in the First Tumim Purchase Agreement. The Company shall not issue or sell any shares of common stock under the First Tumim Purchase Agreement which, when aggregated with all other shares of common stock beneficially owned by Tumim, would result in beneficial ownership of more than 4.99% of the Company's outstanding shares of common stock.

Under the terms of the First Tumim Purchase Agreement, the Company has the right, but not the obligation, to sell to Tumim, shares of common stock over the period commencing on the date of the First Tumim Purchase Agreement (the “Tumim Closing Date”) and ending on the first day of the month following the 36-month anniversary of the Tumim Closing Date, provided that a registration statement covering the resale of shares of common stock that have been and may be issued under the First Tumim Purchase Agreement is declared effective by the SEC. Registration statements covering the offer and sale of up to 18,012,845 and 17,025,590 shares of common stock to Tumim were declared effective on June 30, 2021 and March 22, 2022, respectively. The purchase price will be calculated as 97% of the volume weighted average prices of the Company's common stock during normal trading hours for three consecutive trading days commencing on the purchase notice date.

During the second quarter of 2021 and concurrently with the signing of the First Tumim Purchase Agreement, the Company issued 155,703 shares of its common stock to Tumim as a commitment fee ("Commitment Shares"). The total fair value of the shares issued for the commitment fee of $2.6 million was recorded in "Selling, general, and administrative" expense on the Company's consolidated statements of operations.

During the three and nine months ended September 30, 2022, the Company sold zero and 17,248,244 shares of common stock, respectively, for proceeds of zero and $123.7 million, respectively, under the terms of the First Tumim Purchase Agreement. During the three and nine months ended September 30, 2021, the Company sold 6,270,740 shares of common stock under the terms of the First Tumim Purchase Agreement for proceeds of $72.9 million. As of September 30, 2022, the remaining commitment available under the First Tumim Purchase Agreement was $12.5 million.

23

NIKOLA CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

Second Purchase Agreement with Tumim Stone Capital LLC

On September 24, 2021, the Company entered into a second common stock purchase agreement (the "Second Tumim Purchase Agreement") and a registration rights agreement with Tumim, pursuant to which Tumim committed to purchase up to $300.0 million in shares of the Company's common stock, subject to certain limitations and conditions set forth in the Second Tumim Purchase Agreement. The Company will not issue or sell any shares of common stock under the Second Tumim Purchase Agreement which, when aggregated with all other shares of common stock beneficially owned by Tumim, would result in beneficial ownership of more than 4.99% of the Company's outstanding shares of common stock.

Under the terms of the Second Tumim Purchase Agreement, the Company has the right, but not the obligation, to sell to Tumim, shares of common stock over the period commencing on the date of the Second Tumim Purchase Agreement (the “Second Tumim Closing Date”) and ending on the first day of the month following the 36-month anniversary of the Second Tumim Closing Date, provided that certain conditions have been met. These conditions include effectiveness of a registration statement covering the resale of shares of common stock that have been and may be issued under the Second Tumim Purchase Agreement and termination of the First Tumim Purchase Agreement. The registration statement covering the offer and sale of up to 29,042,827 shares of common stock, including the commitment shares, to Tumim was declared effective on November 29, 2021. The purchase price will be calculated as 97% of the volume weighted average prices of the Company's common stock during normal trading hours for three consecutive trading days commencing on the purchase notice date.

During the third quarter of 2021 and concurrently with the signing of the Second Tumim Purchase Agreement, the Company issued 252,040 shares of its common stock to Tumim as a commitment fee. The total fair value of the shares issued for the commitment fee of $2.9 million was recorded in "Selling, general, and administrative" expense on the Company's consolidated statement of operations.

As of September 30, 2022, the Company has not sold any shares of common stock to Tumim under the Second Tumim Purchase Agreement and has a remaining commitment of $300.0 million available.

Equity Distribution Agreement

In August 2022, the Company entered into an equity distribution agreement (the "Equity Distribution Agreement") with Citi Global Markets, Inc. ("Citi") as sales agent, pursuant to which the Company can issue and sell shares of its common stock with an aggregate maximum offering price of $400 million under the Equity Distribution Agreement. The Company pays Citi a fixed commission rate of 2.5% of gross offering proceeds of shares sold under the Equity Distribution Agreement. During the three months ended September 30, 2022, the Company sold 19,009,227 shares of common stock under the Equity Distribution Agreement at an average price per share of $5.29 for gross proceeds of $100.5 million and net proceeds of approximately $98.0 million, after $2.5 million in commissions to the sales agent. Commissions incurred in connection with the Equity Distribution Agreement are reflected as a reduction of additional paid-in capital on the Company's consolidated balance sheets. As of September 30, 2022, $2.5 million in commissions were recognized in accrued expenses and other current liabilities on the Company's consolidated balance sheets.

7. STOCK BASED COMPENSATION EXPENSE

2017 and 2020 Stock Plans

The 2017 Stock Option Plan (the “2017 Plan”) provides for the grant of incentive and nonqualified options to purchase common stock to officers, employees, directors, and consultants. Options were granted at a price not less than the fair market value on the date of grant and generally became exercisable between one and four years after the date of grant. Options generally expire ten years from the date of grant. Outstanding awards under the 2017 Plan continue to be subject to the terms and conditions of the 2017 Plan.

On June 2, 2020, the stockholders approved the Nikola Corporation 2020 Stock Incentive Plan (the "2020 Plan") and the Nikola Corporation 2020 Employee Stock Purchase Plan (the "2020 ESPP"). The 2020 Plan provides for the grant of incentive and nonqualified stock options, restricted stock units ("RSUs"), restricted share awards, stock appreciation awards, and cash-based awards to employees, outside directors, and consultants of the Company. The 2020 Plan and the 2020 ESPP became effective immediately upon the closing of the Business Combination. No offerings have been authorized to date by the Company's board of directors under the ESPP.

24

NIKOLA CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

Stock Options

The Company utilizes the Black-Scholes option pricing model for estimating the fair value of options granted. Options vest in accordance with the terms set forth in the grant letter. Time-based options generally vest ratably over a period of approximately 36 months. Changes in stock options are as follows:

	Options	Weighted Average Exercise Price Per share		Weighted Average Remaining Contractual Term (Years)
Outstanding at December 31, 2021	28,996,160	$	1.28	6.87
Granted	—	—
Exercised	1,581,791	1.25
Cancelled	29,281	3.39
Outstanding at September 30, 2022	27,385,088	$	1.28	6.09
Vested and exercisable as of September 30, 2022	27,275,672	$	1.27	6.08

Restricted Stock Units

The fair value of RSUs is based on the closing price of the Company’s common stock on the grant date. The time-based RSUs generally vest semi-annually over a three-year period or, in the case of executive officers, cliff-vest following the third anniversary from the date of grant. Certain RSUs awarded to key employees contain performance conditions related to achievement of strategic and operational milestones ("Performance RSUs"). As of September 30, 2022, not all of the performance conditions are probable to be achieved. Compensation expense has only been recognized for those conditions that are assumed to be probable. The Company updates its estimates related to the probability and timing of achievement of the operational milestones each period until the award either vests or is forfeited. In addition, for certain technical engineering employees the awards cliff vest after a three-year period or vest on the achievement of certain operational milestones. The RSUs to directors have a vesting cliff of one year after the grant date.

Changes in RSUs are as follows:

	Number of RSUs
Balance at December 31, 2021	12,178,672
Granted	14,196,410
Released	4,025,887
Cancelled	1,978,005
Balance at September 30, 2022	20,371,190

Market Based RSUs

The Company's market based RSUs contain a stock price index as a benchmark for vesting. Through the second quarter of 2022, these awards were issued with three milestones that vest depending upon a consecutive 20-trading day stock price target of the Company’s common stock. The Company's stock price targets ranged from $25 per share to $55 per share.

During the three months ended September 30, 2022, the market based RSUs subject to the $40 and $55 stock price milestones were cancelled and the Company expensed $55.8 million related to the cancelled awards representing the remaining unamortized expense as of the cancellation date.

During the three months ended September 30, 2022, the performance period for the market based RSUs subject to the $25 stock price milestone was extended from June 3, 2023 to June 3, 2024. The incremental compensation cost from this modification was $4.3 million, determined by comparing the estimated fair value of the modified awards to the estimated fair

25

NIKOLA CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

value of the original awards immediately before the modification of the performance period. The remaining compensation cost related to the original award and the incremental compensation cost are recognized over the award's remaining requisite service period. The vested shares related to the modified awards are transferred to the award holders upon the completion of the requisite service period ending June 3, 2024, and upon achievement certification by the Company's board of directors. If the $25 target price is not achieved by the end of requisite service period, the market based RSUs are forfeited.

During the first quarter of 2022, the Company granted 949,026 shares of market based RSUs to an executive in connection with his hiring during the period. The total grant date fair value of the market based RSUs was determined to be $2.2 million and is recognized over the requisite service period. Additionally, during the third quarter of 2022, the Company granted 402,335 shares of market based RSUs to two executives who assumed new roles within the Company's leadership during the quarter. The awards vest depending upon a consecutive 20-trading day stock price target of the Company’s common stock of $25. The total grant date fair value of the market based RSUs was determined to be $1.1 million and is recognized over the requisite service period.

The estimated fair value of these awards as of the grant date, or as of the modification date, as applicable, were estimated using a Monte Carlo simulation model that utilizes significant assumptions, including volatility, that determine the probability of satisfying the market condition stipulated in the award to calculate the fair value of the award. The following represents the range of assumptions used to determine the grant date or modification date fair value for these market based RSUs:

	Nine Months Ended
	September 30, 2022
Stock price	$5.32 - $9.66
Term (years)	0.80 - 1.80
Risk-free interest rate	1.7% - 3.5%
Expected volatility	100%

Changes in market based RSUs are as follows:

	Number of Market Based RSUs
Balance at December 31, 2021	13,317,712
Granted	1,351,361
Released	—
Cancelled	11,128,458
Balance at September 30, 2022	3,540,615

Stock Compensation Expense

The following table presents the impact of stock-based compensation expense on the consolidated statements of operations for the three and nine months ended September 30, 2022 and 2021:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
Research and development	$	10,105	$	6,418	$	28,112	$	26,968
Selling, general, and administrative	92,740		42,629		183,102		125,015
Total stock-based compensation expense	$	102,845	$	49,047	$	211,214	$	151,983

26

NIKOLA CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

As of September 30, 2022, total unrecognized compensation expense was as follows:

	Unrecognized Compensation Expense
Options	$	184
Market based RSUs	20,943
RSUs	157,502
Total unrecognized compensation expense at September 30, 2022	$	178,629

8. INCOME TAXES

To calculate the interim tax provision, at the end of each interim period the Company estimates the annual effective tax rate and applies that to its ordinary quarterly earnings. The effect of changes in the enacted tax laws or rates is recognized in the interim period in which the change occurs. The computation of the annual estimated effective tax rate at each interim period requires certain estimates and judgments including, but not limited to, the expected operating income for the year, projections of the proportion of income earned and taxed in foreign jurisdictions, permanent differences between book and tax amounts, and the likelihood of recovering deferred tax assets generated in the current year. The accounting estimates used to compute the provision for income taxes may change as new events occur, additional information is obtained, or the tax environment changes.

Beginning in 2022, the Tax Cuts and Jobs Act ("TCJA") requires taxpayers to capitalize certain research and development costs and amortize them over five or fifteen years pursuant to Internal Revenue Code Section 174. Previously, such costs could be deducted in the period they were incurred. This provision is not anticipated to impact our effective tax rate or result in any cash payments for our federal income taxes.

Income tax expense was immaterial for the three and nine months ended September 30, 2022 and 2021 due to the cumulative tax losses.

9. COMMITMENTS AND CONTINGENCIES

Legal Proceedings

The Company is subject to legal and regulatory actions that arise from time to time. The assessment as to whether a loss is probable or reasonably possible, and as to whether such loss or a range of such loss is estimable, often involves significant judgment about future events, and the outcome of litigation is inherently uncertain. The Company expenses professional legal fees as incurred, which are included in selling, general, and administrative expense on the consolidated financial statements. Other than as described below, there is no material pending or threatened litigation against the Company that remains outstanding as of September 30, 2022.

Regulatory and Governmental Investigations and Related Internal Review

In September 2020, a short seller reported on certain aspects of the Company’s business and operations. The Company and its board of directors retained Kirkland & Ellis LLP to conduct an internal review in connection with the short-seller article (the “Internal Review”), and Kirkland & Ellis LLP promptly contacted the Division of Enforcement of the SEC to make it aware of the commencement of the Internal Review. The Company subsequently learned that the Staff of the Division of Enforcement and the United States Attorney’s Office for the Southern District of New York (the “SDNY”) had opened investigations.

By order dated December 21, 2021, the Company and the SEC reached a settlement arising out of the SEC’s investigation of the Company. Under the terms of the settlement, without admitting or denying the SEC’s findings, the Company agreed to cease and desist from future violations of the Securities Exchange Act of 1934 (the "Exchange Act") and Rules 10b-5 and 13a-15(a) thereunder and Section 17(a) of the Securities Act of 1933 (the "Securities Act"); to certain voluntary undertakings; and to pay a $125 million civil penalty, to be paid in five installments over two years.The first $25 million installment was paid at the end of 2021 and the remaining installments are to be paid semiannually through 2023. The Company previously reserved the full amount of the settlement in the quarter ended September 30, 2021, as disclosed in the

27

NIKOLA CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

Company’s quarterly report on Form 10-Q for such quarter, filed with the SEC on November 4, 2021. The SEC’s cease and desist order is available on the SEC’s website. In July 2022, the Company and SEC agreed to an alternative payment plan with the first two payments of $5 million to be paid in July 2022 and December 2022. The July 2022 payment has been made by the Company. The remainder of the payment plan is subject to determination. As of September 30, 2022, the Company has reflected the remaining liability of $70 million in accrued expenses and other current liabilities and $25 million in other-long term liabilities on the consolidated balance sheets.

On July 29, 2021, the U.S. Attorney for the SDNY announced the unsealing of a criminal indictment charging the Company’s former executive chairman, Trevor Milton, with securities fraud and wire fraud. That same day, the SEC announced charges against Mr. Milton for alleged violations of federal securities laws. On October 14, 2022, a Federal District Court jury for the Southern District of New York found Mr. Milton guilty on one count of securities fraud and two counts of wire fraud. The Company is committed to cooperating fully with the SDNY’s investigation.

The legal and other professional costs the Company incurred during the three and nine months ended September 30, 2022 in connection with the Internal Review and disclosed elsewhere in this Report include approximately $6.0 million and $25.5 million, respectively, expensed for Mr. Milton’s attorneys’ fees under his indemnification agreement with the Company. During the three and nine months ended September 30, 2021 the Company expensed $6.4 million and $12.6 million, respectively for Mr. Milton's attorneys' fees under his indemnification agreement with the Company. As of September 30, 2022 and December 31, 2021, the Company accrued approximately $24.0 million and $22.7 million, respectively, in legal and other professional costs for Mr. Milton's attorneys' fees under his indemnification agreement. The Company expects to incur additional costs associated with its continued cooperation with the SDNY in fiscal year 2022, which will be expensed as incurred and which could be significant in the periods in which they are recorded.

The Company cannot predict the ultimate outcome of the SDNY investigation, nor can it predict whether any other governmental authorities will initiate separate investigations or litigation. The outcome of the SDNY investigation and any related legal and administrative proceedings could include a wide variety of outcomes, including the institution of administrative, civil injunctive or criminal proceedings involving the Company and/or current or former employees, officers and/or directors in addition to Mr. Milton, the imposition of fines and other penalties, remedies and/or sanctions, modifications to business practices and compliance programs and/or referral to other governmental agencies for other appropriate actions. It is not possible to accurately predict at this time when matters relating to the SDNY investigation will be completed, the final outcome of the SDNY investigation, what additional actions, if any, may be taken by the SDNY or by other governmental agencies, or the effect that such actions may have on the Company's business, prospects, operating results and financial condition, which could be material.

The SDNY investigation, including any matters identified in the Internal Review, could also result in (1) third-party claims against the Company, which may include the assertion of claims for monetary damages, including but not limited to interest, fees, and expenses, (2) damage to the Company's business or reputation, (3) loss of, or adverse effect on, cash flow, assets, goodwill, results of operations, business, prospects, profits or business value, including the possibility of certain of the Company's existing contracts being cancelled, (4) adverse consequences on the Company's ability to obtain or continue financing for current or future projects and/or (5) claims by directors, officers, employees, affiliates, advisors, attorneys, agents, debt holders or other interest holders or constituents of the Company or its subsidiaries, any of which could have a material adverse effect on the Company's business, prospects, operating results and financial condition.

Further, to the extent that these investigations and any resulting third-party claims yield adverse results over time, such results could jeopardize the Company's operations and exhaust its cash reserves, and could cause stockholders to lose their entire investment.

The Company is currently seeking reimbursement from Mr. Milton for costs and damages arising from the actions that are the subject of the government and regulatory investigations.

Shareholder Securities Litigation

Beginning on September 15, 2020, six putative class action lawsuits were filed against the Company and certain of its current and former officers and directors, asserting violations of federal securities laws under Section 10(b) and Section 20(a) of the Exchange Act, and, in one case, violations of the Unfair Competition Law under California law (the “Shareholder Securities Litigation”). The complaints generally allege that the Company and certain of its officers and directors made false and/or

28

NIKOLA CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

misleading statements in press releases and public filings regarding the Company's business plan and prospects. The actions are: Borteanu v. Nikola Corporation, et al. (Case No. 2:20-cv-01797-JZB), filed by Daniel Borteanu in the United States District Court of the District of Arizona on September 15, 2020; Salem v. Nikola Corporation, et al. (Case No. 1:20-cv-04354), filed by Arab Salem in the United States District Court for the Eastern District of New York on September 16, 2020; Wojichowski v. Nikola Corporation, et al. (Case No. 2:20-cv-01819-DLR), filed by John Wojichowski in the United States District Court for the District of Arizona on September 17, 2020; Malov. Nikola Corporation, et al. (Case No. 5:20-cv-02168), filed by Douglas Malo in the United States District Court for the Central District of California on October 16, 2020; and Holzmacher, et al. v. Nikola Corporation, et al. (Case No. 2:20-cv-2123-JJT), filed by Albert Holzmacher, Michael Wood and Tate Wood in the United States District Court for the District of Arizona on November 3, 2020, and Eves v. Nikola Corporation, et al. (Case No. 2:20-cv-02168-DLR), filed by William Eves in the United States District Court for the District of Arizona on November 10, 2020. In October 2020, stipulations by and among the parties to extend the time for the defendants to respond to the complaints until a lead plaintiff, lead counsel, and an operative complaint are identified were entered as orders in certain of the filed actions. On November 16, 2020 and December 8, 2020 respectively, orders in the Malo and Salem actions were entered to transfer the actions to the United States District Court for the District of Arizona.

On November 16, 2020, ten motions both to consolidate the pending securities actions and to be appointed as lead plaintiff were filed by putative class members. On December 15, 2020, the United States District Court for the District of Arizona consolidated the actions under lead case Borteanu v. Nikola Corporation, et al., No. CV-20-01797-PXL-SPL, and appointed Angelo Baio as the “Lead Plaintiff”. On December 23, 2020, a motion for reconsideration of the Court’s order appointing the Lead Plaintiff was filed. On December 30, 2020, a petition for writ of mandamus seeking to vacate the District Court’s Lead Plaintiff order and directing the court to appoint another Lead Plaintiff was filed before the United States Court of Appeals for the Ninth Circuit, Case No. 20-73819. The motion for reconsideration was denied on February 18, 2021. On July 23, 2021, the Ninth Circuit granted in part the mandamus petition, vacated the district court’s December 15, 2020 order, and remanded the case to the District Court to reevaluate the appointment of a Lead Plaintiff. On November 18, 2021, the Court appointed Nikola Investor Group II as Lead Plaintiff and appointed Pomerantz LLP and Block & Leviton LLP as co-lead counsel. On December 10, 2021, the Court issued a scheduling order pursuant to which Lead Plaintiff’s Amended Complaint was due January 24, 2022, Defendants’ deadline to answer or otherwise respond was set for March 10, 2022 and Plaintiffs’ deadline to file any responsive memorandum was set for April 11, 2022 with any reply from Defendants due by May 11, 2022. On January 24, 2022, Lead Plaintiffs filed the Consolidated Amended Class Action Complaint. On February 5, 2022, the Court granted the parties’ joint application for an extension of the deadline for Defendants to file an answer or move to dismiss until April 8, 2022, with Plaintiffs’ opposition due 30 days following the filing of a motion to dismiss, and any reply from Defendants due 30 days following Plaintiffs’ opposition. In accordance with the Court’s scheduling order, Defendants filed their motions to dismiss on April 8, 2022. On May 9, 2022, Plaintiffs filed their opposition to Defendants' motions to dismiss, and on June 8, 2022, Defendants filed their reply briefs. The Court has not yet ruled on the motions.

Plaintiffs seek an unspecified amount in damages, attorneys’ fees, and other relief. The Company intends to vigorously defend itself. The Company is unable to estimate the potential loss or range of loss, if any, associated with these lawsuits, which could be material. On December 17, 2021, Lead Plaintiff filed a motion to lift the PSLRA stay of discovery. On January 18, 2022, Nikola filed its opposition to Lead Plaintiff’s motion to lift the PSLRA stay of discovery and on January 25, 2022, Lead Plaintiff filed its reply. On April 21, 2022, the Court denied Plaintiffs' motion to lift the PSLRA stay.

Derivative Litigation

Beginning on September 23, 2020, two purported shareholder derivative actions were filed in the United States District Court for the District of Delaware (Byun v. Milton, et al., Case No. 1:20-cv-01277-UNA; Salguocar v. Girsky et. al., Case No. 1:20-cv-01404-UNA), purportedly on behalf of the Company, against certain of the Company's current and former directors alleging breaches of fiduciary duties, violations of Section 14(a) of the Exchange Act, and gross mismanagement. The Byun action also brings claims for unjust enrichment and abuse of control, while the Salguocar action brings a claim for waste of corporate assets. On October 19, 2020, the Byun action was stayed until 30 days after the earlier of (a) the Shareholder Securities Litigation being dismissed in their entirety with prejudice; (b) defendants filing an answer to any complaint in the Shareholder Securities Litigation; or (c) a joint request by plaintiff and defendants to lift the stay. On November 17, 2020, the Byun and Salguocar actions were consolidated as In re Nikola Corporation Derivative Litigation, Lead Case No. 20-cv-01277-CFC. The consolidated action remains stayed.

29

NIKOLA CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

On December 18, 2020, a purported shareholder derivative action was filed in the United States District Court for the District of Arizona, Huhn v. Milton et al., Case No. 2:20-cv-02437-DWL, purportedly on behalf of the Company, against certain of the Company’s current and former directors alleging breaches of fiduciary duties, violations of Section 14(a) of the Exchange Act, unjust enrichment, and against defendant Jeff Ubben, a member of the Company’s board of directors, insider selling and misappropriation of information. On January 26, 2021, the Huhn action was stayed until 30 days after the earlier of (a) the Shareholder Securities Litigation being dismissed in its entirety with prejudice; (b) defendants filing an answer to any complaint in the Shareholder Securities Litigation; or (c) a joint request by plaintiff and defendants to lift the stay.

On January 7, 2022, Barbara Rhodes, a purported stockholder of the Company, filed her Verified Stockholder Derivative Complaint in Delaware Chancery Court captioned Rhodes v. Milton, et al. and Nikola Corp., C.A. No. 2022-0023-KSJM (the “Rhodes Action”). On January 10, 2022, Zachary BeHage and Benjamin Rowe (together, the “BeHage Rowe Plaintiffs”), purported stockholders of the Company, filed their Verified Shareholder Derivative Complaint in Delaware Chancery Court captioned BeHage v. Milton, et al. and Nikola Corp., C.A. No. 2022-0045-KSJM (the “BeHage Rowe Action”together with the Rhodes Action, the “Related Actions”). The Related Actions are against certain of the Company’s current and former directors and allege breach of fiduciary duties, insider selling under Brophy, aiding and abetting insider selling, aiding and abetting breach of fiduciary duties, unjust enrichment, and waste of corporate assets. On January 28, 2022, Rhodes and the BeHage Rowe Plaintiffs filed a stipulation and proposed order for consolidation of the Related Actions. The proposed order states that Defendants need not answer, move, or otherwise respond to the complaints filed in the Related Actions and contemplates that counsel for Plaintiffs shall file a consolidated complaint or designate an operative complaint within fourteen days of entry of an order consolidating these actions and shall meet and confer with counsel for Defendants or any other party regarding a schedule for Defendants to respond to the operative complaint. The proposed order was granted by the Court on February 1, 2022. On February 15, 2022, Rhodes and the BeHage Rowe Plaintiffs filed a Verified Consolidated Amended Stockholder Derivative Complaint in the Related Actions (the “Amended Complaint”). On April 4, 2022, the parties filed a stipulation and proposed order, pursuant to which the parties to the Related Actions agreed that Defendants need not answer, move, or otherwise respond to certain counts of the Amended Complaint. In accordance with the Court-ordered stipulation, Defendants filed their motions to stay the remaining counts of the Amended Complaint on April 13, 2022. Plaintiffs filed their oppositions on May 4, 2022, and Defendants filed their replies on May 25, 2022. In a bench ruling following a telephonic oral argument on June 1, 2022, the Court granted Defendants' motions to stay the remaining counts of the Amended Complaint. The Court ordered the Defendants to submit a status report on October 31, 2022, or within three days of receipt of a decision on the motions to dismiss in the Shareholder Securities Litigation, whichever comes first, in which Defendants can request a continued stay of the Related Actions. On March 10, 2022, Michelle Brown and Crisanto Gomes (together, the “Brown & Gomes Plaintiffs”), purported stockholders of the Company, filed a Verified Shareholder Derivative Complaint in Delaware Chancery Court captioned Brown v. Milton, et al. and Nikola Corp., C.A. No. 2022-0223-KSJM (the “Brown & Gomes Action”). The Brown & Gomes Action is against certain of the Company’s current and former directors and alleges claims against those defendants for purported breaches of fiduciary duty and unjust enrichment. On March 14, 2022, the Brown & Gomes Plaintiffs notified the court in the Related Actions of their belief that the Brown & Gomes Action properly belongs as part of the consolidated Related Actions.

The complaints seek unspecified monetary damages, costs and fees associated with bringing the actions, and reform of the Company's corporate governance, risk management and operating practices. The Company intends to vigorously defend against the foregoing complaints. The Company is unable to estimate the potential loss or range of loss, if any, associated with these lawsuits, which could be material.

In addition, on March 8, 2021, the Company received a demand letter from a law firm representing a purported stockholder of the Company alleging facts and claims substantially the same as many of the facts and claims in the filed derivative shareholder lawsuit. The demand letter requests that the board of directors (i) undertake an independent internal investigation into certain board members and management’s purported violations of Delaware and/or federal law; and (ii) commence a civil action against those members of the board and management for alleged fiduciary breaches. In April 2021, the board of directors formed a demand review committee, consisting of independent directors Bruce L. Smith, and Mary L. Petrovich, to review such demands and provide input to the Company and retained independent counsel. There can be no assurance as to whether any litigation will be commenced by or against the Company by the purported shareholder with respect to the claims set forth in the demand letter, or whether any such litigation could be material.

30

NIKOLA CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

Books and Record Demands Pursuant to Delaware General Corporation Law Section 220

The Company has received a number of demand letters pursuant to Section 220 of the Delaware General Corporation Law (“DGCL”), seeking disclosure of certain of the Company’s records. The Company has responded to those demands, stating its belief that the demand letters fail to fully comply with the requirements of Section 220 of the DGCL. However, in the interest of resolution and while preserving all rights of the defendants, the Company has engaged in negotiations with the shareholders, and has provided certain information that the Company had reasonably available to it.

On January 15, 2021, Plaintiff Frances Gatto filed a complaint in Delaware Chancery Court seeking to compel inspection of books and records pursuant to Section 220 of the DGCL. On January 26, 2021, Plaintiff’s counsel and the Company filed a joint letter, notifying the Court that the parties are engaged in dialogue regarding Plaintiff’s demand, and the Company need not answer or otherwise respond to the complaint at this time. On October 20, 2021, Plaintiff dismissed the action without prejudice.

On October 8, 2021, Plaintiffs Zachary BeHage and Benjamin Rowe filed a complaint in Delaware Chancery Court seeking to compel inspection of books and records pursuant to Section 220 of the DGCL. On October 19, 2021, Plaintiffs’ counsel and the Company filed a joint letter, notifying the Court that the parties are engaged in dialogue regarding Plaintiffs’ demand, and the Company need not answer or otherwise respond to the complaint at this time. On January 14, 2022, Plaintiffs dismissed the action without prejudice.

On January 19, 2022, Plaintiff Melissa Patel filed a complaint in Delaware Chancery Court seeking to compel inspection of books and records pursuant to Section 220 of the DGCL. On February 20, 2022, the parties filed a stipulation and proposed order of dismissal without prejudice, which the court granted on February 21, 2022.

Commitments and Contingencies

Coolidge Land Conveyance

In February 2019, the Company was conveyed 430 acres of land in Coolidge, Arizona, by Pinal Land Holdings ("PLH"). The purpose of the land conveyance was to incentivize the Company to locate its manufacturing facility in Coolidge, Arizona, and provide additional jobs to the region. The Company fulfilled its requirement to commence construction within the period defined by the agreement and is required to complete construction of the manufacturing facility within five years of February 2019 (the “Manufacturing Facility Deadline”).

If the Company fails to meet the Manufacturing Facility Deadline, the Company may extend the completion deadline by paying PLH $0.2 million per month, until construction is completed (the "Monthly Payment Option"). The extension of the Manufacturing Facility Deadline beyond two years will require express written consent of PLH. If the Company does not exercise the Monthly Payment Option, fails to make timely payments on the Monthly Payment Option, or fails to complete construction by the extended Manufacturing Facility Deadline, PLH is entitled to either the $4.0 million security deposit or may reacquire the land and property at the appraised value to be determined by independent appraisers selected by the Company and PLH.

FCPM License

In the third quarter of 2021, the Company entered into a fuel cell power module ("FCPM") license to intellectual property that will be used to adapt, further develop and assemble FCPMs. Payments for the license will be due in installments ranging from 2022 to 2023. As of September 30, 2022, the Company accrued $29.4 million in accrued expenses and other current liabilities on the consolidated balance sheets.

Merger with Romeo

The Company entered into the Merger Agreement with Romeo and Purchaser, a wholly-owned subsidiary of the Company. Headquartered in Cypress, California, Romeo is an energy storage technology company focused on designing and manufacturing lithium-ion battery modules and packs for commercial vehicle applications.

Concurrently with the execution of the Merger Agreement, Romeo and Romeo Systems, entered into the Loan Agreement with the Company as the lender. The Loan Agreement provides for the Facility in an aggregate principal amount of up to $30.0 million (subject to certain incremental increases of up to $20.0 million), which shall be available for drawing

31

NIKOLA CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

subject to certain terms and conditions set forth in the Loan Agreement. Loans under the Facility may be made until the earlier of (a) six months from the date of the execution and delivery of the Merger Agreement and the Loan Agreement and (b) the date of the termination of the Merger Agreement. All amounts outstanding under the Facility will be due upon the earlier of (a) the date that is the six-month anniversary of the termination of the Merger Agreement and (b) July 30, 2023, subject to acceleration upon the occurrence of certain events set forth in the Loan Agreement. Interest will be payable on borrowings under the Facility at daily SOFR plus 8.00%. Romeo’s obligations under the Loan Agreement are secured by substantially all personal property assets of Romeo and Romeo Systems, subject to certain customary exclusions.

As of September 30, 2022, Romeo has drawn $10.0 million under the Facility and $20.0 million remained available. For the three months ended September 30, 2022, the Company recognized $0.1 million of interest receivable on the outstanding loan balance. Additionally, as part of the Merger Agreement, the Company agreed to a short-term battery price increase which will be considered part of the merger consideration. As of September 30, 2022 the Company recorded $11.9 million for the increased price in prepaid expenses and other current assets on the Company's consolidated balance sheets, which will be included in the business combination consideration.

The merger with Romeo closed on October 14, 2022. Refer to Note 11, Subsequent Events for additional details.

Leases executed not yet commenced

As of September 30, 2022, the Company entered various lease agreements related to hydrogen fueling infrastructure which have not yet commenced. Undiscounted lease payments related to these obligations are $13.3 million.

Purchase obligations

During the three months ended September 30, 2022, the Company entered various non-cancellable purchase obligations related to hydrogen infrastructure and software licenses. Purchase obligations remaining as of September 30, 2022 total $14.3 million.

10. NET LOSS PER SHARE

The following table sets forth the computation of the basic and diluted net loss per share for the three and nine months ended September 30, 2022 and 2021:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
Numerator:
Net loss	$	(236,234)	$	(267,567)	$	(562,172)	$	(531,022)
Less: revaluation of warrant liability	—		(4,467)		—		(2,907)
Adjusted net loss	$	(236,234)	$	(272,034)	$	(562,172)	$	(533,929)
Denominator:
Weighted average shares outstanding, basic	438,416,393		400,219,585		426,382,736		395,691,795
Dilutive effect of common stock issuable from assumed exercise of warrants	—		11,084		—		169,081
Weighted average shares outstanding, diluted	438,416,393		400,230,669		426,382,736		395,860,876
Net loss per share:
Basic	$	(0.54)	$	(0.67)	$	(1.32)	$	(1.34)
Diluted	$	(0.54)	$	(0.68)	$	(1.32)	$	(1.35)

Basic net loss per share is computed by dividing net loss for the period by the weighted-average number of common shares outstanding during the period.

Diluted net loss per share is computed by dividing the net loss, adjusted for the revaluation of warrant liability for the private warrants, by the weighted average number of common shares outstanding for the period, adjusted for the dilutive effect

32

NIKOLA CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

of shares of common stock equivalents resulting from the assumed exercise of the warrants. The treasury stock method was used to calculate the potential dilutive effect of these common stock equivalents.

Potentially dilutive shares were excluded from the computation of diluted net loss when their effect was antidilutive. The following outstanding common stock equivalents were excluded from the computation of diluted net loss per share for the periods presented because including them would have been anti-dilutive.

	Three Months Ended September 30,		Nine Months Ended September 30,
	2022	2021	2022	2021
Convertible Notes (on an as-converted basis)	22,872,040	—	22,872,040	—
Outstanding warrants	760,915	—	760,915	—
Stock options, including performance stock options	27,385,088	29,299,842	27,385,088	29,299,842
Restricted stock units, including market based RSUs	23,911,805	24,319,237	23,911,805	24,319,237
Total	74,929,848	53,619,079	74,929,848	53,619,079

11. SUBSEQUENT EVENTS

On October 14, 2022, the Company completed the previously announced acquisition of Romeo pursuant to the Merger Agreement, dated as of July 30, 2022, between Nikola, Romeo and Purchaser. Pursuant to the terms of the Merger Agreement, the Purchaser merged with and into Romeo (the “Merger”), with Romeo continuing as the surviving corporation and a wholly owned subsidiary of Nikola. In the Merger, each share of Romeo Common Stock that was issued and outstanding immediately prior to the effective time of the Merger (the “Effective Time”) (other than any shares that were excluded pursuant to the terms of the Merger Agreement) was converted at the Effective Time into the right to receive 0.1186 of a share of Nikola common stock, rounded down to the nearest whole number of shares of Nikola common stock. Each Romeo restricted stock unit (“RSU”) and Romeo performance-related stock unit (“PSU”) that was outstanding and not settled immediately prior to the effective time was converted into and became an RSU or PSU, as applicable, which will settle for shares of Nikola common stock, determined by multiplying the number of shares of Romeo Common Stock that were subject to such Romeo RSU or Romeo PSU, as in effect immediately prior to the effective time, by 0.1186, rounded down to the nearest whole number of shares of Nikola common stock. Each Romeo warrant exercisable for Romeo Common Stock was assumed by Nikola and converted into a corresponding warrant denominated in shares of Nikola common stock (with the number of warrants determined by multiplying the number of shares of Romeo common stock subject to such Romeo warrant by 0.1186 rounded down to the nearest whole number of shares of Nikola common stock, and the per share exercise price for the Nikola common stock issuable upon exercise for each warrant assumed by the Company determined by dividing the per share exercise price of Romeo Common Stock subject to such warrant by 0.1186).

Preliminary purchase price accounting will be reflected in the Company's Form 10-K for the period ending December 31, 2022.

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

This report contains forward-looking statements and can be identified by the words “anticipate,” “believe,” “expect,” “estimate,” “intend,” “plan,” "will", and similar expressions. These are statements that relate to future periods and include our financial and business performance; expected timing with respect to the expansion of our manufacturing facilities, joint venture with Iveco and production and attributes of our BEV and FCEV trucks; expectations regarding our hydrogen fuel station rollout plan and hydrogen strategy; timing of completion of validation testing, volume production and other milestones; securing components for our trucks on acceptable terms and in a timely manner, or at all; changes in our strategy, future operations, financial position, estimated revenues and losses, projected costs, prospects and plans; planned collaboration with our business partners; our future capital requirements and sources and uses of cash; the potential outcome of investigations, litigation, complaints, product liability claims and/or adverse publicity; the implementation, market acceptance and success of our business model; developments relating to our competitors and industry; the impact of health epidemics, including the COVID-19 pandemic, on our business and the actions we may take in response thereto; our expectations regarding our ability to obtain and maintain intellectual property protection and not infringe on the rights of others; our ability to obtain funding for our operations; the outcome of any known and unknown regulatory proceedings; our business, expansion plans and opportunities; changes in applicable laws or regulations; our expectations regarding our acquisition of Romeo Power, Inc. (“Romeo”) and the potential benefits and liabilities related to the transaction; and anticipated trends and challenges in our business and the markets in which we operate.

Forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those expected. These risks and uncertainties include, but are not limited to, those risks discussed in Item 1A of this report, as well as our ability to execute our business model, including market acceptance of our planned products and services; changes in applicable laws or regulations; risks associated with the outcome of any legal, regulatory, or judicial proceeding; the effect of the COVID-19 pandemic on our business; supply chain constraints; the impact of inflation; our ability to raise capital; our ability to compete; the success of our business collaborations; regulatory developments in the United States and foreign countries; the possibility that we may be adversely affected by other economic, business, and/or competitive factors; our ability to achieve the intended benefits of our acquisition of Romeo, and liabilities associated with the acquisition; and our history of operating losses. These forward-looking statements speak only as of the date hereof. We expressly disclaim any obligation or undertaking to update any forward-looking statements contained herein to reflect any change in our expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based.

In this report, all references to “Nikola,” “we,” “us,” or “our” mean Nikola Corporation.

Nikola™ is a trademark of Nikola Corporation. We also refer to trademarks of other corporations and organizations in this report.

The below discussion should be read in conjunction with Management’s Discussion and Analysis of Financial Condition and Results of Operations and the audited consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2021.

Overview

We are a technology innovator and integrator, working to develop innovative energy and transportation solutions. We are pioneering a business model that will enable corporate customers to integrate next-generation truck technology, hydrogen fueling infrastructure, and related maintenance. By creating this ecosystem, we and our strategic business partners and suppliers hope to build a long-term competitive advantage for clean technology vehicles and next generation fueling solutions.

Our expertise lies in design, innovation, and software and engineering. We assemble, integrate, and commission our vehicles in collaboration with our business partners and suppliers. Our approach includes leveraging strategic partnerships to help lower cost, increase capital efficiency and increase speed to market.

We operate in two business units: Truck and Energy. The Truck business unit is developing and commercializing BEV and FCEV Class 8 trucks that provide environmentally friendly, cost-effective solutions to the short, medium and long haul trucking sector. The Energy business unit is primarily developing a hydrogen fueling ecosystem and charging stations to support our BEV and FCEV customers.

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Our planned hydrogen fueling ecosystem is expected to include hydrogen production and/or hydrogen procurement, hydrogen distribution, and hydrogen storage and dispensing. As part of our hydrogen strategy, on June 22, 2021, we entered into a purchase agreement ("Offtake Agreement") with Wabash Valley Resources LLC (“WVR”), pursuant to which WVR agreed to sell to us, and we agreed to purchase from WVR, hydrogen to be produced from the hydrogen production facility being developed by WVR in West Terre Haute, Indiana (the "Plant"), once completed. In the third quarter of 2022, we purchased a land parcel in Arizona which will be utilized to construct a hydrogen hub with partners.

During 2020, we established a joint venture with Iveco, Nikola Iveco Europe GmbH. Our joint venture with Iveco provides us with the manufacturing infrastructure to build BEV trucks for the North American market in addition to that of our greenfield manufacturing facility in Coolidge, Arizona. The operations of the joint venture commenced during the fourth quarter of 2020. During the second quarter of 2021, the joint venture completed the construction of the manufacturing facility and started trial production for the Nikola Tre BEV on the assembly line in Ulm, Germany. In June 2022, we executed amended agreements with Iveco to expand the scope of the joint venture operations to include engineering and development of the Nikola Tre BEV European platform.

We expect both our capital and operating expenditures will increase significantly in connection with our ongoing activities, as we:

•    commercialize our heavy-duty trucks and other products;

•    expand and maintain manufacturing facilities and equipment;

•    invest in servicing our vehicles under warranty including repairs and service parts;

•    develop hydrogen fueling stations;

•    continue to invest in our technology;

•    increase our investment in marketing and advertising, sales, and distribution infrastructure for our products and services;

•    maintain and improve our operational, financial and management information systems;

•    hire additional personnel;

•integrate operations of Romeo pursuant to the closing of the merger in October 2022;

•    obtain, maintain, expand, and protect our intellectual property portfolio; and

•    operate as a public company.

Recent Developments

On August 1, 2022, we entered into a definitive merger agreement with Romeo in an all-stock transaction. The merger closed on October 14, 2022, and is expected to allow us to secure control of critical battery pack engineering and production to meet internal demand.

Romeo is headquartered in Cypress, California, and manufactures battery modules, packs, and battery management systems ("BMS") for commercial vehicle applications. As Romeo's largest production customer, we expect the merger will allow for significant operational improvements and cost reductions in our battery pack production. The addition of Romeo's battery and BMS engineering capabilities are also expected to support accelerated product development and improved customer experience.

Key Factors Affecting Operating Results

We believe that our performance and future success depend on several factors that present significant opportunities for us but also pose risks and challenges, including those discussed below and in the section titled “Risk Factors.”

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We started serial production at our Coolidge manufacturing facility in March 2022 and began sales of Tre BEV trucks in the second quarter of 2022. In the third quarter, we produced 75 Tre BEV trucks and shipped 63 Tre BEV trucks to our dealer network.

Tre BEVs	Q2 2022	Q3 2022	YTD 2022
Produced	50	75	125
Shipped	48	63	111

We continue to experience supply chain challenges, including increased prices for commodities due to inflation. There is no guarantee we can successfully pass increased component costs to customers and how that may impact their decision to purchase our trucks.

We sell our trucks to dealers in our network and rely on the dealers to sell them to end users. As we recently began sales of our Tre BEV, we have and may continue to experience delays in receiving additional purchase orders from our dealers. The end users of the Tre BEV will need to continuously assess their charging capacity and may need to build or expand infrastructure prior to ordering or receiving trucks from the dealers. Dealers have and may continue to experience delays in receiving proceeds from the California Hybrid Zero Emission Truck and Voucher Incentive Program ("HVIP"), and may experience delays receiving proceeds from the New York Truck Voucher Incentive Program ("NYTVIP") or other government incentive programs, which many of them are leveraging for the first time. To qualify for the HVIP and NYTVIP, the dealers are required to complete extensive training, initiate and complete applications for each sales order, and complete the voucher redemption process upon delivery to the end user. In addition, there may be delays in end user purchase orders due to general economic conditions, which in turn could delay dealer purchase orders issued to us. The declining macroeconomic environment and freight market conditions has and may continue to result in end users’ reluctance to make significant capital expenditures in the necessary charging infrastructure, thereby affecting demand for our trucks.

We require substantial additional capital to develop our products, including the Tre FCEV trucks, and services and fund operations for the foreseeable future. Until we can generate sufficient revenue, we expect to finance our operations through a combination of existing cash on hand, follow-on public offerings, private placements, debt financings, strategic partnerships, and licensing arrangements. The amount and timing of our future funding requirements will depend on many factors, including the pace and results of our development efforts.

Basis of Presentation

Currently, we conduct business through one operating segment. See Note 2 in our Annual Report on Form 10-K for the year ended December 31, 2021 for more information.

Components of Results of Operations

Revenues

Truck sales: During the three and nine months ended September 30, 2022, our truck sales were derived from deliveries of our Tre BEV trucks.

Service and other: During the three and nine months ended September 30, 2022, service and other revenues includes sales from deliveries of Mobile Charging Trailers ("MCTs") and other charging products to dealers and customers.

Cost of Revenues

Truck sales: Cost of revenue includes direct parts, material and labor costs, manufacturing overhead, including amortized tooling costs and depreciation of our Coolidge manufacturing facilities, shipping costs and reserves for estimated warranty expenses and inventory write-downs.

Service and other: Cost of revenues related to MCT and other charging product sales primarily include direct materials, outsourced manufacturing services, and fulfillment costs.

Research and Development Expense

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Research and development expenses consist primarily of costs incurred for the discovery and development of our vehicles, which include:

•    Fees paid to third parties such as consultants and contractors for outside development;

•    Expenses related to materials, supplies and third-party services, including prototype tooling and non-recurring engineering;

•    Personnel related expenses, including salaries, benefits, and stock-based compensation expense, for personnel in our engineering and research functions;

•    Depreciation for prototyping equipment and R&D facilities; and

•Expenses related to operating the Coolidge manufacturing facility until the start of commercial production. With the start of commercial production of the Tre BEV, manufacturing costs, including labor and overhead, as well as inventory-related expenses related to the Tre BEV trucks, and related facility costs, are no longer recorded in research and development but are reflected in cost of revenues.

During the three and nine months ended September 30, 2022, our research and development expenses have primarily been incurred in the development of our FCEV trucks.

We expect our research and development costs to increase for the foreseeable future as we continue to invest to achieve our technology and product roadmap goals.

Selling, General, and Administrative Expense

Selling, general, and administrative expenses consist of personnel related expenses for our corporate, executive, finance, and other administrative functions, expenses for outside professional services, including legal, audit and accounting services, as well as expenses for facilities, depreciation, amortization, travel, and marketing costs. Personnel related expenses consist of salaries, benefits, and stock-based compensation.

We expect our selling, general, and administrative expenses to increase for the foreseeable future as we scale headcount with the growth of our business, and as a result of operating as a public company.

Interest Expense, net

Interest expense consists of interest on our debt, financing obligation and finance lease liabilities. Interest income consists primarily of interest received or earned on our cash and cash equivalents balances and loan receivables.

Revaluation of Warrant Liability

The revaluation of warrant liability includes net gains and losses from the remeasurement of the warrant liability. Warrants recorded as liabilities are recorded at their fair value and remeasured at each reporting period.

Other Income (Expense), net

Other income, net consists primarily of other miscellaneous non-operating items, such as government grants, subsidies, merchandising, revaluation gains and losses on derivatives, foreign currency gains and losses, and unrealized gains and losses on investments.

Income Tax Expense

Our income tax provision consists of an estimate for U.S. federal and state income taxes based on enacted rates, as adjusted for allowable credits, deductions, uncertain tax positions, changes in deferred tax assets and liabilities, and changes in the tax law. Due to cumulative losses, we maintain a valuation allowance against our U.S. and state deferred tax assets.

Equity in Net Loss of Affiliates

Equity in net loss of affiliates consists of our portion of net gains and losses from equity method investments.

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Results of Operations

Comparison of Three Months Ended September 30, 2022 to Three Months Ended September 30, 2021

The following table sets forth our historical operating results for the periods indicated:

	Three Months Ended September 30,				$		%
	2022		2021		Change		Change
	(in thousands, except share and per share data)
Revenues:
Truck sales	$	23,853	$	—	$	23,853	NM
Service and other	388		—		388		NM
Total revenues	24,241		—		24,241		NM
Cost of revenues:
Truck sales	54,080		—		54,080		NM
Service and other	330		—		330		NM
Total cost of revenues	54,410		—		54,410		NM
Gross loss	(30,169)		—		(30,169)		NM
Operating expenses:
Research and development	66,683		78,896		(12,213)		(15.5)%
Selling, general, and administrative	132,865		192,929		(60,064)		(31.1)%
Total operating expenses	199,548		271,825		(72,277)		(26.6)%
Loss from operations	(229,717)		(271,825)		42,108		(15.5)%
Other income (expense):
Interest expense, net	(7,735)		(118)		(7,617)		6455.1%
Revaluation of warrant liability	586		4,467		(3,881)		(86.9)%
Other income (expense), net	2,617		1,057		1,560		147.6%
Loss before income taxes and equity in net loss of affiliates	(234,249)		(266,419)		32,170		(12.1)%
Income tax expense	1		1		—		NM
Loss before equity in net loss of affiliates	(234,250)		(266,420)		32,170		(12.1)%
Equity in net loss of affiliates	(1,984)		(1,147)		(837)		73.0%
Net loss	$	(236,234)	$	(267,567)	$	31,333	(11.7)%
Net loss per share:
Basic	$	(0.54)	$	(0.67)	$	0.13	NM
Diluted	$	(0.54)	$	(0.68)	$	0.14	NM
Weighted-average shares outstanding:
Basic	438,416,393		400,219,585		38,196,808		NM
Diluted	438,416,393		400,230,669		38,185,724		NM

Revenues

Revenues were $24.2 million during the three months ended September 30, 2022, consisting of $23.9 million in truck sales driven by sales of Tre BEV trucks and $0.4 million in service and other sales driven by deliveries of MCT and other charging units.

Cost of Revenues

Truck Sales

Cost of revenues related to truck sales were $54.1 million during the three months ended September 30, 2022. Truck cost of revenues include direct materials, freight and duties for transportation of purchased parts, manufacturing labor and overhead including Coolidge plant facility costs and depreciation, inventory write-downs for net realizable value and obsolescence, and reserves for estimated warranty expenses. Given our inventory is stated at net realizable value, which is

38

currently lower than the actual cost, any overhead including freight is expensed in the period incurred as opposed to being capitalized into inventory.

With the start of production late in the first quarter of 2022, we have experienced high fixed costs due to low volumes produced and have relied on expedited air freight to meet production deadlines. These costs are expected to decrease as we increase volumes and mature our supply chain logistics.

Service and other

Cost of revenues related to service and other revenue were $0.3 million during the three months ended September 30, 2022, driven by direct materials, outsourced services, and fulfillment costs related to MCT and other charging products delivered in the third quarter of 2022.

Research and Development

Research and development expenses decreased by $12.2 million, or 15.5%, from $78.9 million during the three months ended September 30, 2021 to $66.7 million during the three months ended September 30, 2022. The decrease was primarily due to a decrease in outside development of $14.5 million, and a decrease of $6.1 million in spend on prototype parts, components and associated freight and duties related to the BEV and FCEV prototype builds. The decreases were partially offset by an increase in personnel costs of $5.8 million driven by growth in our in-house engineering headcount and increases in stock based compensation of $2.8 million.

Selling, General, and Administrative

Selling, general, and administrative expenses decreased by $60.1 million, or 31.1%, from $192.9 million during the three months ended September 30, 2021 to $132.9 million during the three months ended September 30, 2022. The decrease was driven by $125 million recognized in the third quarter of 2021 related to settlement of the SEC investigation. Additionally, there was a decrease of $2.9 million related to the non-cash commitment share issuance costs related to the equity line of credit with Tumim Stone Capital LLC in 2021. These decreases were partially offset by an increase in stock based compensation of $50.2 million driven primarily by the acceleration of compensation cost related to the cancellations of the market based RSUs in the third quarter of 2022. Additionally, there was an increase in personnel expense of $7.3 million.

Interest Expense, net

Interest expense, net increased by $7.6 million from $0.1 million during the three months ended September 30, 2021 to $7.7 million during the three months ended September 30, 2022. Interest expense increased due to interest on our Convertible Notes of $6.4 million, interest on our financing obligation of $0.9 million, and interest on our Collateralized Promissory Notes of $0.6 million, partially offset by interest income recognized on our senior secured loan receivable.

Revaluation of Warrant Liability

The revaluation of warrant liability decreased $3.9 million, from a $4.5 million gain during the three months ended September 30, 2021 to a $0.6 million gain during the three months ended September 30, 2022, resulting from changes in fair value of our warrant liability.

Other Income, net

Other income, net increased by $1.6 million from $1.1 million during the three months ended September 30, 2021 to $2.6 million during the three months ended September 30, 2022. The increase is primarily related to gains from foreign currency translation of $1.7 million, government grant income, and a net gain on revaluation of derivatives, partially offset by a $0.3 million loss from the derivative asset.

Income Tax Expense

Income tax expense was immaterial for the three months ended September 30, 2022 and 2021. We have accumulated net operating losses at the federal and state level and maintain a full valuation allowance against our net deferred taxes.

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Equity in Net Loss of Affiliates

Equity in net loss of affiliates increased by $0.8 million, from $1.1 million for the three months ended September 30, 2021 to $2.0 million for the three months ended September 30, 2022. The increase was driven by additional losses in the current period related to Nikola Iveco Europe GmbH and WVR.

Comparison of Nine Months Ended September 30, 2022 to Nine Months Ended September 30, 2021

The following table sets forth our historical operating results for the periods indicated:

	Nine Months Ended September 30,				$		%
	2022		2021		Change		Change
	(dollar amounts in thousands)
Revenues:
Truck sales	$	41,236	$	—	$	41,236	NM
Service and other	3,026		—		3,026		NM
Total revenues	44,262		—		44,262		NM
Cost of revenues:
Truck sales	100,861		—		100,861		NM
Service and other	2,396		—		2,396		NM
Total cost of revenues	103,257		—		103,257		NM
Gross loss	(58,995)		—		(58,995)		NM
Operating expenses:
Research and development	204,346		201,785		2,561		1.3%
Selling, general, and administrative	289,916		329,028		(39,112)		(11.9)%
Total operating expenses	494,262		530,813		(36,551)		(6.9)%
Loss from operations	(553,257)		(530,813)		(22,444)		4.2%
Other income (expense):
Interest expense, net	(10,754)		(219)		(10,535)		4810.5%
Revaluation of warrant liability	3,493		2,907		586		20.2%
Other income (expense), net	4,423		174		4,249		2442.0%
Loss before income taxes and equity in net loss of affiliates	(556,095)		(527,951)		(28,144)		5.3%
Income tax expense	3		4		(1)		NM
Loss before equity in net loss of affiliates	(556,098)		(527,955)		(28,143)		5.3%
Equity in net loss of affiliates	(6,074)		(3,067)		(3,007)		98.0%
Net loss	$	(562,172)	$	(531,022)	$	(31,150)	5.9%
Net loss per share:
Basic	$	(1.32)	$	(1.34)	$	0.02	NM
Diluted	$	(1.32)	$	(1.35)	$	0.03	NM
Weighted-average shares outstanding:
Basic	426,382,736		395,691,795		30,690,941		NM
Diluted	426,382,736		395,860,876		30,521,860		NM

Revenues

Revenues were $44.3 million during the nine months ended September 30, 2022, consisting of $41.2 million in truck sales driven by sales of Tre BEV trucks and $3.0 million in service and other sales driven by deliveries of MCT and other charging products.

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Cost of Revenues

Truck sales

Cost of revenues related to truck sales were $100.9 million during the nine months ended September 30, 2022. Truck cost of revenues include direct materials, freight and duties for transportation of purchased parts, manufacturing labor and overhead including Coolidge plant facility costs and depreciation, inventory write-downs for net realizable value and obsolescence, and reserves for estimated warranty expenses. Given our inventory is stated at net realizable value, which is currently lower than the actual cost, any overhead including freight is expensed in the period incurred as opposed to being capitalized into inventory.

With the start of production late in the first quarter of 2022, we have experienced high fixed costs due to low volumes produced and have relied on expedited air freight to meet production deadlines. These costs are expected to decrease as we increase volumes and mature our supply chain logistics.

Service and other

Cost of revenues related to service and other revenue were $2.4 million during the nine months ended September 30, 2022, driven by direct materials, outsourced services, and fulfillment costs related to MCTs and other charging product deliveries.

Research and Development

Research and development expenses increased by $2.6 million, or 1.3%, from $201.8 million during the nine months ended September 30, 2021 to $204.3 million during the nine months ended September 30, 2022. This increase was primarily due to increased personnel costs of $23.6 million driven by growth in our in-house engineering headcount. We also incurred $7.8 million in higher spend on prototype parts, components and associated freight and duties related to Tre BEV and FCEV prototype builds. Additional increases were driven by higher depreciation and occupancy costs of $2.8 million related to equipment and software dedicated to research and development activities, an increase in professional services of $1.7 million, and increased travel of $1.5 million. These increases were partially offset by a decrease of $34.4 million in outside development.

Selling, General, and Administrative

Selling, general, and administrative expenses decreased by $39.1 million, or 11.9%, from $329.0 million during the nine months ended September 30, 2021 to $289.9 million during the nine months ended September 30, 2022. The decrease was driven by $125 million recognized in the third quarter of 2021 related to settlement of the SEC investigation, and the non-cash commitment share issuance costs related to the equity line of credit with Tumim Stone Capital LLC in 2021. The decrease was partially offset by an increase in stock based compensation of $58.2 million driven primarily by acceleration of compensation cost related to the cancellations of the market based RSUs in the third quarter of 2022, and an increase in headcount. Additionally, there were increases related to higher personnel costs of $15.7 million driven by growth in headcount, an increase in professional services of $6.5 million, and an increase in legal costs of $4.4 million.

Interest Expense, net

Interest expense, net increased by $10.5 million from $0.2 million during the three months ended September 30, 2021 to $10.8 million during the three months ended September 30, 2022. Interest expense increased due to interest on our Convertible Notes of $8.5 million, interest on our financing obligation of $1.4 million, and interest on our Promissory Note and Collateralized Promissory Notes of $1.1 million.

Revaluation of Warrant Liability

The revaluation of warrant liability increased $0.6 million, from a $2.9 million gain during the nine months ended September 30, 2021 to a $3.5 million gain during the nine months ended September 30, 2022 resulting from changes in fair value of our warrant liability.

Other Income, net

Other income, net increased by $4.2 million from $0.2 million during the three months ended September 30, 2021 to $4.4 million during the three months ended September 30, 2022. The increase is primarily related to gains from foreign currency

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translation of $5.9 million, government grant income, and a net gain on revaluation of derivatives. These increases were partially offset by the write off of unamortized debt issuance costs on the Promissory Note.

Income Tax Expense

Income tax expense was immaterial for the nine months ended September 30, 2022 and 2021. We have accumulated net operating losses at the federal and state level and maintain a full valuation allowance against our net deferred taxes.

Equity in Net Loss of Affiliates

Equity in net loss of affiliates increased by $3.0 million, from $3.1 million for the three months ended September 30, 2021 to $6.1 million for the three months ended September 30, 2022. The increase was driven by additional losses in the current period related to Nikola Iveco Europe GmbH and WVR.

Non-GAAP Financial Measures

In addition to our results determined in accordance with GAAP, we believe the following non-GAAP measures are useful in evaluating operational performance. We use the following non-GAAP financial information to evaluate ongoing operations and for internal planning and forecasting purposes. We believe that non-GAAP financial information, when taken collectively, may be helpful to investors in assessing operating performance.

EBITDA and Adjusted EBITDA

“EBITDA” is defined as net loss before interest income or expense, income tax expense or benefit, and depreciation and amortization. “Adjusted EBITDA” is defined as EBITDA adjusted for stock-based compensation and other items determined by management. Adjusted EBITDA is intended as a supplemental measure of our performance that is neither required by, nor presented in accordance with, GAAP. We believe that the use of EBITDA and Adjusted EBITDA provides an additional tool for investors to use in evaluating ongoing operating results and trends and in comparing our financial measures with those of comparable companies, which may present similar non-GAAP financial measures to investors. However, you should be aware that when evaluating EBITDA and Adjusted EBITDA we may incur future expenses similar to those excluded when calculating these measures. In addition, our presentation of these measures should not be construed as an inference that our future results will be unaffected by unusual or non-recurring items. Our computation of Adjusted EBITDA may not be comparable to other similarly titled measures computed by other companies, because all companies may not calculate Adjusted EBITDA in the same fashion.

Because of these limitations, EBITDA and Adjusted EBITDA should not be considered in isolation or as a substitute for performance measures calculated in accordance with GAAP. We compensate for these limitations by relying primarily on our GAAP results and using EBITDA and Adjusted EBITDA on a supplemental basis. You should review the reconciliation of net loss to EBITDA and Adjusted EBITDA below and not rely on any single financial measure to evaluate our business.

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The following table reconciles net loss to EBITDA and Adjusted EBITDA for the three and nine months ended September 30, 2022 and 2021:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
	(in thousands)
Net loss	$	(236,234)	$	(267,567)	$	(562,172)	$	(531,022)
Interest expense, net	7,735		118		10,754		219
Income tax expense	1		1		3		4
Depreciation and amortization	6,796		2,249		16,472		5,959
EBITDA	(221,702)		(265,199)		(534,943)		(524,840)
Stock-based compensation	102,845		49,047		211,214		151,983
Revaluation of financial instruments	(286)		(4,786)		(94)		(3,226)
Equity in net loss of affiliates	1,984		1,147		6,074		3,067
Regulatory and legal matters (1)	11,227		9,771		38,319		35,657
SEC settlement	—		125,000		—		125,000
Adjusted EBITDA	$	(105,932)	$	(85,020)	$	(279,430)	$	(212,359)

(1) Regulatory and legal matters include legal, advisory, and other professional service fees incurred in connection with the short-seller article from September 2020, and investigations and litigation related thereto.

Non-GAAP Net Loss and Non-GAAP Net Loss Per Share, Basic and Diluted

Non-GAAP net loss and non-GAAP net loss per share, basic and diluted are presented as supplemental measures of our performance. Non-GAAP net loss is defined as net loss, basic and diluted adjusted for stock compensation expense and other items determined by management. Non-GAAP net loss per share, basic and diluted, is defined as non-GAAP net loss divided by weighted average shares outstanding, basic and diluted.

	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
	(in thousands, except share and per share data)
Net loss	$	(236,234)	$	(267,567)	$	(562,172)	$	(531,022)
Stock-based compensation	102,845		49,047		211,214		151,983
Revaluation of financial instruments	(286)		(4,786)		(94)		(3,226)
Regulatory and legal matters(1)	11,227		9,771		38,319		35,657
SEC settlement	—		125,000		—		125,000
Non-GAAP net loss	$	(122,448)	$	(88,535)	$	(312,733)	$	(221,608)
Non-GAAP net loss per share:
Basic	$	(0.28)	$	(0.22)	$	(0.73)	$	(0.56)
Diluted	$	(0.28)	$	(0.22)	$	(0.73)	$	(0.56)
Weighted average shares outstanding:
Basic	438,416,393		400,219,585		426,382,736		395,691,795
Diluted	438,416,393		400,230,669		426,382,736		395,860,876

(1) Regulatory and legal matters include legal, advisory, and other professional service fees incurred in connection with the short-seller article from September 2020, and investigations and litigation related thereto.

Liquidity and Capital Resources

Since inception, we financed our operations primarily from the sales of redeemable convertible preferred stock and common stock, the Business Combination, a private placement with investors (the "PIPE"), proceeds from the Tumim Purchase Agreements, redemption of warrants, and debt. As of September 30, 2022, our principal sources of liquidity were our cash and cash equivalents in the amount of $315.7 million. During the second quarter of 2022, we completed a private placement of

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$200.0 million aggregate principal amount of unsecured 8.00% / 11.00% convertible senior PIK toggle notes (the "Convertible Notes"), which mature on May 31, 2026. Net proceeds from the issuance were $183.2 million.

During 2021, we entered into a common stock purchase agreement with Tumim (the "First Tumim Purchase Agreement") allowing us to issue shares of our common stock to Tumim for proceeds of up to $300.0 million. During the three and nine months ended September 30, 2022, we sold zero and 17,248,244 shares of common stock, respectively, for proceeds of zero and $123.7 million, respectively, under the terms of the First Tumim Purchase Agreement. As of September 30, 2022 we have issued in aggregate 31,461,742 shares of common stock to Tumim under the terms of the First Tumim Purchase Agreement for gross proceeds of $287.5 million, excluding the 155,703 commitment shares issued to Tumim as consideration for its irrevocable commitment to purchase shares of our common stock under the First Tumim Purchase Agreement. As of September 30, 2022, there were 3,420,990 registered shares remaining and a remaining commitment available under the First Tumim Purchase Agreement of $12.5 million.

Additionally, during 2021, we entered into a second common stock purchase agreement with Tumim (the "Second Tumim Purchase Agreement" and, together with the First Tumim Purchase Agreement, the "Tumim Purchase Agreements") allowing us to issue shares of our common stock to Tumim for proceeds of up to an additional $300.0 million, provided that certain conditions have been met. These conditions include effectiveness of a registration statement covering the resale of shares of common stock that have been and may be issued under the Second Tumim Purchase Agreement and termination of the First Tumim Purchase Agreement. As of September 30, 2022, we have not sold any shares of common stock to Tumim under the terms of the Second Tumim Purchase Agreement with 28,790,787 registered shares remaining and a remaining commitment of $300.0 million available.

During the third quarter of 2022, we entered into an equity distribution agreement (the "Equity Distribution Agreement") with Citi Global Markets, Inc. ("Citi") pursuant to which we can issue and sell shares of our common stock with an aggregate maximum offering price of $400 million. During the three and nine months ended September 30, 2022, we sold 19,009,227 shares of common stock under our Equity Distribution Agreement. We received $100.5 million in gross proceeds from the Equity Distribution Agreement and accrued commissions to the sales agent of $2.5 million, resulting in net proceeds of $98.0 million recognized during the third quarter of 2022.

Short-Term Liquidity Requirements

As of September 30, 2022, our current assets were $486.9 million consisting primarily of cash and cash equivalents of $315.7 million, and our current liabilities were $277.6 million primarily comprised of accrued expenses and accounts payables.

We believe our cash and cash equivalents and available liquidity and capital resources will be sufficient to continue to execute our business strategy over the next twelve-month period by completing the development and industrialization of the FCEV truck, growing sales volumes of the BEV truck, construction of planned commercial hydrogen infrastructure, and hiring of personnel.

However, actual results could vary materially and negatively as a result of a number of factors, including: