M&M Residual Withdraws its Nomination of Directors Amid Recently Uncovered Potential Misconduct

M&M Residual and Mr. Milton Reserve All Rights, Including Pursuing Potential Legal Action Against the Officers and Directors of Nikola

M&M Residual, LLC (“M&M Residual”) and Trevor R. Milton (collectively “we” or “us”) today announced that M&M Residual has withdrawn its previously delivered nomination of five candidates (the “Nomination”) for election to the Board of Directors (the “Board”) of Nikola Corporation (Nasdaq: NKLA) (“Nikola” or the “Company”) at its upcoming 2024 Annual Meeting of Stockholders (the “Annual Meeting”). M&M Residual delivered the Nomination because it believed it was critical to bring much-needed change to the Company through a reconstitution of the Board. We continue to believe that Nikola’s employees are incredible and deserve honest, capable and visionary leadership. We felt that the Nomination was the best chance to give the Company the ability to thrive and prosper.

Unfortunately, instead of letting its stockholders decide and voice their opinions on the direction of the Company at the Annual Meeting, the Company initiated litigation against us and two of the nominees (the “Arizona Lawsuit”). Further, we have recently learned of highly concerning information regarding potentially fraudulent conduct of Nikola’s management and certain directors, which leads us to question the merits of the full Board. We have ultimately concluded that it has become too risky to step in and expose our remaining nominees to the Company.

For approximately four years now, the Board led by Steve Girsky has overseen a staggering and consistent decline in value, operational underperformance, product liability concerns, trucks burning down, the breakdown of the Iveco Group-Nikola partnership, value destructive acquisitions, the loss of meaningful European market share, withholding information from stockholders, and the sale of key assets, all while taking on debt and unnecessary litigation. These actions have resulted in the destruction of nearly 100% of stockholder value. While the Company has been content to allege that Mr. Milton is the cause of the Company’s misfortunes, we believe the documents and facts will prove otherwise. We reserve all rights concerning recently uncovered information and intend to hold the Company’s Board, officers, and directors accountable.

The Company has only now publicly disclosed its 2023 sale of the Nikola Badger and powersports program (the “Badger Transaction”), to an entity unaffiliated with us, and seemingly only to further its interests in the Arizona Lawsuit. In our view, the Badger Transaction confirms that the Nikola Badger product was real, used mostly Nikola’s parts and has material value. The Badger Transaction, which was sold to a third party, was never disclosed to the market or stockholders until just recently through the Arizona Lawsuit. We find it highly concerning that the Company then went on to sell additional shares in the public markets after failing to disclose what we believe to be a material transaction, likely causing stockholders to suffer significant losses.

The Company also previously blamed the recent occurrences of Nikola trucks catching fire (the “BEV Fires”) on “foul play.” However, after the Phoenix Fire Department found “no evidence at all that supports arson,”1 the Company recalled the affected vehicles acknowledging that “foul play” was unlikely to have caused the BEV Fires.2 We find the facts alleged in a recent stockholder lawsuit concerning the BEV Fires to be extremely troubling and believe they indicate that the Company may have known there were material issues with these products prior to making the “foul play” comments to the public markets. We believe the Board has continually made misleading statements about foul play being the cause of the fires. Again, shortly after making these comments, the Company went on to sell additional shares in the public markets, which we believe caused further significant financial damage to its stockholders. We are deeply concerned that Company executives and management experienced no apparent or material accountability, despite making what we believe to be materially false statements and causing harm to the Company’s value, resulting in the Company being sued by stockholders concerning the BEV Fires.3

Nikola stockholders deserve to know who approved the stock sales and these concerning statements. It appears that no one is monitoring the Company’s public statements or, if they are, who approved these statements and why have they not been held publicly accountable? Unfortunately, we have lost complete faith in the Board and believe its members cannot be trusted to hold those responsible for apparently misleading the public accountable.

As a fellow stockholder of the Company, we share your frustration with the Company’s performance, lack of accountability and apparently misleading disclosures. To us, and we believe many in the public, the Board’s pattern is clear: destroy stockholder value, blame Mr. Milton for the incompetence of the Board, sell off promising assets, hide information from stockholders, take no responsibility and then initiate litigation against anyone willing to expose the truth. During his tenure, Mr. Girsky has overseen the monumental destruction of Nikola from approximately $34.19 a share when Mr. Milton stepped down to a dismal $0.98 that may force the stock to be delisted soon.4

We believe the Company initiated the Arizona Lawsuit to intimidate our nominees and thwart the lawful exercise of stockholder rights. We have therefore decided to withdraw the Nomination and pursue alternative methods to hold the directors and officers of the Company accountable, including through the initiation of independent litigation. For these reasons, we have withdrawn the Nomination and no longer intend to solicit Nikola stockholders with respect to the Annual Meeting, and our previous group has been dissolved.

To all the Nikola employees and stockholders, we are sorry we were not able to bring the change you deserve through the Nomination, but we believe that the truth will soon be exposed, vindicating our belief that Mr. Milton was ultimately the scapegoat of the Board’s actions. One day we hope you have the leadership you all deserve.

1 See https://electrek.co/2023/07/06/nikola-truck-fire-no-evidence-arson/
2 See https://www.thedrive.com/news/nikola-recalls-electric-trucks-because-foul-play-fires-were-coolant-leaks
3 See https://news.bloomberglaw.com/litigation/truck-maker-nikola-sued-by-investors-over-recent-battery-fires
4 FactSet. Based on a closing price of $34.19 on September 18, 2020 (the last business day prior to Mr. Milton stepping down) and a closing price of $0.98 on April 10, 2024.

Saratoga Proxy Consulting LLC
John Ferguson / Joe Mills, 212-257-1311
info@saratogaproxy.com

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