|Nikola Executes Second Purchase Agreement With Tumim Stone Capital, Bringing The Total To $600 Million PR Newswire|
PHOENIX, Sept. 27, 2021
PHOENIX, Sept. 27, 2021 /PRNewswire/ -- Nikola Corporation (NASDAQ: NKLA) and Tumim Stone Capital LLC (Tumim) have entered into a second $300 million common stock equity line purchase agreement, providing Nikola the right to issue and sell to Tumim up to $600 million of Nikola's common stock in aggregate, subject to certain conditions and limitations.
"The equity lines with Tumim, together with estimated cash and cash equivalents, will provide Nikola with access to approximately $800 million of liquidity at the end of 2021," said Nikola CEO Mark Russell. "We believe this will provide ample liquidity for Nikola to fund our stated operational milestones through the end of 2022, which include the commercial delivery of BEV trucks as well as the start of road release and pilot testing of FCEV trucks."
Nikola CFO Kim Brady commented on the agreement: "Since entering into the original equity line purchase agreement on June 11, 2021, Nikola has issued approximately $47 million of common stock to Tumim. We view this second equity line purchase agreement as a financing tool that allows Nikola to leverage the healthy daily liquidity in our stock while giving us considerable flexibility around issuance timing to minimize dilution. We have no obligation to fully utilize either facility, and we continue to consider other sources, including the broader capital markets, which we view as our principal source of financing for Nikola."
Maier Tarlow, managing partner of Tumim added: "We are excited to be part of Nikola's journey towards large-scale production of zero-emission battery-electric and hydrogen-electric commercial vehicles. Subject to the terms of the Purchase Agreement, Nikola can issue shares to Tumim on dates of its choosing under the ELOC. We look forward to continuing to be a long-term partner with the Company."
Under this second equity line purchase agreement, Nikola has the right, but not the obligation to sell up to $300 million of additional shares of its common stock to Tumim, subject to certain limitations. Purchase notices may be issued to Tumim over the period commencing from the date of the purchase agreement and ending on the first day of the month following the 36-month anniversary. The shares will be issued at a 3% discount to the three-day forward volume-weighted average price from the date a purchase notice is issued. Nikola issued Tumim 252,040 shares of common stock as consideration for Tumim's irrevocable commitment to purchase Nikola common stock under the new purchase agreement. Further details will be contained in the Current Report on Form 8-K Nikola intends to file later today.