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The information in this preliminary prospectus is not complete and may be changed. Neither we nor the selling securityholders may sell these securities until the registrationstatement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and is not soliciting an offer to buy these securities inany jurisdiction where the offer or sale is not permitted.

SUBJECT TO COMPLETION—DATED JULY 17, 2020

PRELIMINARY PROSPECTUS

Nikola Corporation

Up to 249,843,711 Shares of Common Stock

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        This prospectus relates to the offer and sale from time to time by the selling securityholders named in this 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") andCowen Investments II, LLC ("Cowen Investments" and, together with the Sponsor, the "Founders") in a private placement in connection with the initial public offering (the "IPO") of VectoIQAcquisition Corp. ("VectoIQ") 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 rightsunder 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 suchshares. We will not receive any proceeds from the sale of shares of Common Stock by the Selling Securityholders pursuant to this prospectus.

        Ourregistration of the securities covered by this prospectus does not mean that the Selling Securityholders will offer or sell any of the shares. The Selling Securityholders may sellthe shares of Common Stock covered by this prospectus in a number of different ways and at varying prices. We provide more information about how the Selling Securityholders may sell the shares in thesection entitled "Plan of Distribution."

        OurCommon Stock and warrants to purchase Common Stock (the "Public Warrants") are listed on the Nasdaq Global Select Market under the symbols "NKLA" and "NKLAW," respectively. OnJuly 16, 2020, the closing price of our Common Stock was $52.53 and the closing price for our Public Warrants was $23.37.

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        See the section entitled "Risk Factors" beginning on page 7 of this prospectus to readabout factors you should consider before buying our securities.

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

The date of this prospectus is                , 2020.

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        You should rely only on the information provided in this prospectus, as well as the information incorporated by reference into this prospectus and any applicableprospectus supplement. Neither we nor the Selling Securityholders have authorized anyone to provide you with different information. Neither we nor the Selling Securityholders are making an offer ofthese securities in any jurisdiction where the offer is not permitted. You should not assume that the information in this prospectus or any applicable prospectus supplement is accurate as of any dateother than the date of the applicable document. Since the date of this prospectus and the documents incorporated by reference into this prospectus, our business, financial condition, results ofoperations and prospects may have changed.

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ABOUT THIS PROSPECTUS

        This prospectus is part of a registration statement on Form S-1 that we filed with the Securities and Exchange Commission (the "SEC")using the "shelf" registration process. Under this shelf registration process, the Selling Securityholders may, from time to time, sell the securities offered by them described in this prospectus. Wewill not receive any proceeds from the sale by such Selling Securityholders of the securities offered by them described in this prospectus.

        Neitherwe nor the Selling Securityholders have authorized anyone to provide you with any information or to make any representations other than those contained in this prospectus or anyapplicable prospectus supplement or any free writing prospectuses prepared by or on behalf of us or to which we have referred you. Neither we nor the Selling Securityholders take responsibility for,and can provide no assurance as to the reliability of, any other information that others may give you. Neither we nor the Selling Securityholders will make an offer to sell these securities in anyjurisdiction where the offer or sale is not permitted.

        Wemay also provide a prospectus supplement or post-effective amendment to the registration statement to add information to, or update or change information contained in, thisprospectus. You should read both this prospectus and any applicable prospectus supplement or post-effective amendment to the registration statement together with the additional information to which werefer you in the sections of this prospectus entitled "Where You Can Find More Information."

        OnJune 3, 2020 (the "Closing Date"), VectoIQ Acquisition Corp., our predecessor company ("VectoIQ"), consummated the previously announced merger pursuant to that certain BusinessCombination Agreement, dated March 2, 2020 (the "Business Combination Agreement"), by and among the VectoIQ, VCTIQ Merger Sub Corp., a wholly-owned subsidiary of VectoIQ incorporated in theState of Delaware ("Merger Sub"), and Nikola Corporation, a Delaware corporation ("Legacy Nikola"). Pursuant to the terms of the Business Combination Agreement, a business combination between theCompany and Legacy Nikola was effected through the merger of Merger Sub with and into Legacy Nikola, with Legacy Nikola surviving as the surviving company and as a wholly-owned subsidiary of VectoIQ(the "Merger" and, collectively with the other transactions described in the Business Combination Agreement, the "Business Combination"). On the Closing Date, and in connection with the closing of theBusiness Combination (the "Closing"), VectoIQ Acquisition Corp. changed its name to Nikola Corporation.

        Unlessthe context indicates otherwise, references in this prospectus to the "Company," "Nikola," "we," "us," "our" and similar terms refer to Nikola Corporation (f/k/a VectoIQAcquisition Corp.) and its consolidated subsidiaries (including Legacy Nikola). References to "VectoIQ" refer to our predecessor company prior to the consummation of the Business Combination.

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FORWARD-LOOKING STATEMENTS

        This prospectus and any accompanying prospectus supplement contain forward-looking statements that involve risks and uncertainties. Thesestatements relate to future periods, future events or our future operating or financial plans or performance. When used in this prospectus, the words "anticipate," "believe," "continue," "could,""estimate," "expect," "intends," "project," "forecast," "may," "might," "plan," "possible," "potential," "predict," "project," "should,""seeks," "scheduled," or "will," and similar expressions are intended to identify forward-looking statements, and include but are not limited to:

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our ability to recognize the anticipated benefits of the Business Combination, which may be affected by, among other things, competition andthe ability of the combined business to grow and manage growth profitably;



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our financial and business performance following the Business Combination, including financial projections and business metrics;



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changes in our strategy, future operations, financial position, estimated revenues and losses, projected costs, prospects and plans;



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litigation, complaints, product liability claims and/or adverse publicity;



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the implementation, market acceptance and success of our business model;



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developments and projections relating to our competitors and industry;



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the impact of health epidemics, including the COVID-19 pandemic, on our business and the actions we may take in response thereto;



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our expectations regarding our ability to obtain and maintain intellectual property protection and not infringe on the rights of others;



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our future capital requirements and sources and uses of cash;



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our ability to obtain funding for our operations;



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our business, expansion plans and opportunities;



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changes in applicable laws or regulations; and



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the outcome of any known and unknown litigation and regulatory proceedings.

        Thesestatements are subject to known and unknown risks, uncertainties and assumptions that could cause actual results to differ materially from those projected or otherwise implied bythe forward-looking statements, including the following:

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the outcome of any legal proceedings;



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our ability to recognize the anticipated benefits of the Business Combination, which may be affected by, among other things, competition andour ability to grow and manage growth profitably following the Business Combination;



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costs related to the Business Combination;



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changes in applicable laws or regulations;



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the effect of the COVID-19 pandemic on our business;



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our ability to execute our business model, including market acceptance of our planned products and services;



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our ability to raise capital;

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the possibility that we may be adversely affected by other economic, business, and/or competitive factors; and



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other risks and uncertainties described in this registration statement, including those under the section entitled"Risk Factors."

        Giventhese risks and uncertainties, you should not place undue reliance on these forward-looking statements. Additional cautionary statements or discussions of risks and uncertaintiesthat could affect our results or the achievement of the expectations described in forward-looking statements may also be contained in any accompanying prospectus supplement.

        Theseforward-looking statements made by us in this prospectus and any accompanying prospectus supplement speak only as of the date of this prospectus and the accompanying prospectussupplement. Except as required under the federal securities laws and rules and regulations of the SEC, we expressly disclaim any obligation or undertaking to release publicly any updates or revisionsto 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 isbased. You should, however, review additional disclosures we make in our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, and Current Reports on Form 8-K filed with theSEC.

        Youshould read this prospectus and any accompanying prospectus supplement completely and with the understanding that our actual future results, levels of activity and performance aswell as other events and circumstances may be materially different from what we expect. We qualify all of our forward-looking statements by these cautionary statements.

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RISK FACTORS

        Investing in our securities involves risks. Before you make a decision to buy our securities, in addition to the risksand uncertainties discussed above under "Forward-Looking Statements," you should carefully consider the specific risks set forth herein. If any of these risks actually occur, it may materially harmour business, financial condition, liquidity and results of operations. As a result, the market price of our securities could decline, and you could lose all or part of your investment. Additionally,the risks and uncertainties described in this prospectus or any prospectus supplement are not the only risks and uncertainties that we face. Additional risks and uncertainties not presently known tous or that we currently believe to be immaterial may become material and adversely affect our business.

Risks Related to the Company's Business and Industry

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

        We incurred a net loss of $88.7 million for the year ended December 31, 2019 and have incurred net losses of approximately$188.5 million from our inception through December 31, 2019. We believe that we will continue to incur operating and net losses each quarter until at least the time we begin significantdeliveries of our trucks, which is not expected to begin until 2021 for our Nikola Tre BEV and 2023 for our Nikola Two FCEV, and may occur later. Even if we are able to successfully develop and sellor lease our trucks, there can be no assurance that they will be commercially successful. Our potential profitability is dependent upon the successful development and successful commercialintroduction and acceptance of our trucks and our hydrogen station platform, which may not occur.

        Weexpect the rate at which we will incur losses to be significantly high in future periods as we:

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design, develop and manufacture our trucks;



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construct and equip our planned manufacturing plant to produce our trucks in Arizona;



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modify and equip the Iveco manufacturing plant in Germany to produce our trucks in Europe;



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build up inventories of parts and components for our trucks;



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manufacture an available inventory of our trucks;



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develop and deploy our hydrogen fueling stations;



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expand our design, development, maintenance and repair capabilities;



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increase our sales and marketing activities and develop our distribution infrastructure; and



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increase our general and administrative functions to support our growing operations.

        Becausewe will incur the costs and expenses from these efforts before we receive any incremental revenues with respect thereto, our losses in future periods will be significant. Inaddition, we may find that these efforts are more expensive than we currently anticipate or that these efforts may not result in revenues, which would further increase our losses.

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

        We will require significant capital to develop and grow our business, including developing and manufacturing our trucks, building ourmanufacturing plant and building our brand. We expect to incur significant expenses which will impact our profitability, including research and development expenses, raw material procurement costs,leases, sales and distribution expenses as we build our brand and market our trucks and bundled leasing model, and general and administrative expenses as we scale our operations. In addition, we mayincur significant costs in connection with our services, including

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buildingour hydrogen fueling stations and honoring our maintenance commitments under our bundled lease package. Our ability to become profitable in the future will not only depend on our ability tosuccessfully market our vehicles and other products and services, but also to control our costs. If we are unable to cost efficiently design, manufacture, market, sell, distribute and service ourtrucks and services, our margins, profitability and prospects would be materially and adversely affected.

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

        Investors should be aware of the difficulties normally encountered by a new enterprise, many of which are beyond our control, includingsubstantial risks and expenses in the course of establishing or entering new markets, organizing operations and undertaking marketing activities. The likelihood of our success must be considered inlight of these risks, expenses, complications, delays and the competitive environment in which we operate. There is, therefore, nothing at this time upon which to base an assumption that our businessplan will prove successful, and we may not be able to generate significant revenue, raise additional capital or operate profitably. We will continue to encounter risks and difficulties frequentlyexperienced by early commercial stage companies, including scaling up our infrastructure and headcount, and may encounter unforeseen expenses, difficulties or delays in connection with our growth. Inaddition, as a result of the capital-intensive nature of our business, we can be expected to continue to sustain substantial operating expenses without generating sufficient revenues to coverexpenditures. Any investment in our company is therefore highly speculative and could result in the loss of your entire investment.

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

        You must consider the risks and difficulties we face as an early stage company with a limited operating history. If we do not successfullyaddress these risks, our business, prospects, operating results and financial condition will be materially and adversely harmed. We have a very limited operating history on which investors can base anevaluation of our business, operating results and prospects. We intend to derive substantially all of our revenues from the sale and lease of our vehicle platforms, which are still in the early stagesof development. Due to our bundled lease model for our FCEV trucks, our revenues will also depend on the sale of hydrogen fuel at our planned hydrogen fueling stations which we do not expect to beoperational until 2022 or later. There are no assurances that we will be able to secure future business with the major trucking companies or with independent truck drivers. We also have a Powersportsdivision and recently announced a passenger truck. While we intend to focus on our commercial trucks and bundled leases, our other business lines may distract management's focus on what we considerour core business.

        Itis difficult to predict our future revenues and appropriately budget for our expenses, and we have limited insight into trends that may emerge and affect our business. In the eventthat actual results differ from our estimates or we adjust our estimates in future periods, our operating results and financial position could be materially affected.

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

        The design, manufacture, lease, sale and servicing of vehicles and related hydrogen fueling stations is capital-intensive. We expect that wewill have sufficient capital to fund our planned operations for the next 12 to 18 months. We will need to raise additional capital to scale our manufacturing and roll out our hydrogen refuelingstations. We may raise additional funds through the issuance of equity,

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equityrelated or debt securities, or through obtaining credit from government or financial institutions. This capital will be necessary to fund our ongoing operations, continue research, developmentand design efforts, improve infrastructure, introduce new vehicles and build hydrogen fueling stations. We cannot be certain that additional funds will be available to us on favorable terms whenrequired, or atall. If we cannot raise additional funds when we need them, our financial condition, results of operations, business and prospects could be materially adversely affected.

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

        Any failure to manage our growth effectively could materially and adversely affect our business, prospects, operating results and financialcondition. We intend to expand our operations significantly. Our future expansion will include:

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training new personnel;



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forecasting production and revenue;



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controlling expenses and investments in anticipation of expanded operations;



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establishing or expanding design, manufacturing, sales and service facilities; and



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implementing and enhancing administrative infrastructure, systems and processes.

        Weintend to continue to hire a significant number of additional personnel, including design and manufacturing personnel and service technicians for our trucks. Because our trucks arebased on adifferent technology platform than traditional internal combustion engines, individuals with sufficient training in alternative fuel and electric vehicles may not be available to hire, and as aresult, we will need to expend significant time and expense training the employees we do hire. Competition for individuals with experience designing, manufacturing and servicing electric vehicles isintense, and we may not be able to attract, integrate, train, motivate or retain additional highly qualified personnel in the future. The failure to attract, integrate, train, motivate and retainthese additional employees could seriously harm our business and prospects.

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

        Our bundled lease model which provides customers with the FCEV truck hydrogen fuel and maintenance for a fixed price per mile is reliant on ourability to achieve a minimum hydrogen fuel efficiency in our FCEV trucks. If we are unable to achieve or maintain this fuel efficiency, we may be forced to provide our bundled lease customers withfuel at prices below-cost or risk damaging our relationships with our customers. Any such scenario would put our bundled lease model in jeopardy and may have a material adverse effect on our business,prospects, operating results and financial condition.

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

        Our business plan includes the direct sale of vehicles to business customers, and potentially, to individual customers. Most, if not all, statesrequire a license to sell vehicles within the state. Many states prohibit manufacturers from directly selling vehicles to customers. In other states, manufacturers must operate a physical dealershipwithin the state to deliver vehicles to customers. As a result, we may not be able to sell directly to customers in each state in the United States.

        Weare currently not registered as a dealer in any state. In many states, it is unclear if, as a manufacturer, we will be able to obtain permission to sell and deliver vehicles directlyto customers.

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Forcustomers residing in states in which we will not be allowed to sell or deliver vehicles, we may have to arrange alternate methods of delivery of vehicles. This could include delivering vehiclesto adjacent or nearby states in which we are allowed to directly sell and ship vehicles, and arranging for the customer to transport the vehicles to their home states. These workarounds could addsignificant complexity, and as a result, costs, to our business.

Our success will depend on our ability to economically manufacture our trucks at scale and build our hydrogenfueling 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.

        Our future business depends in large part on our ability to execute our plans to develop, manufacture, market and sell our Nikola Tre BEV andNikola Two FCEV trucks and to deploy the associated hydrogen fueling stations for our FCEV trucks at sufficient capacity to meet the transportation demands of our business customers. We plan toinitially commence manufacturing our trucks in Europe through our joint venture with CNH Industrial N.V. ("CNHI") and Iveco S.p.A. ("Iveco" and, collectively with CNHI, "CNHI/Iveco"),which is expected to commence operations in the third quarter of 2020, and in the future at our planned manufacturing plant in Arizona.

        Ourcontinued development of our truck platforms is and will be subject to risks, including with respect to:

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our ability to secure necessary funding;



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the equipment we plan to use being able to accurately manufacture the vehicles within specified design tolerances;



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long- and short-term durability of our hydrogen fuel cell and electric drivetrain technology related components in the day-to-day wear and tearof the commercial trucking environment;



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compliance with environmental, workplace safety and similar regulations;



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securing necessary components on acceptable terms and in a timely manner;



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delays in delivery of final component designs to our suppliers;



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our ability to attract, recruit, hire and train skilled employees;



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quality controls, particularly as we plan to commence manufacturing in-house;



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delays or disruptions in our supply chain; and



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other delays and cost overruns.

        Wehave no experience to date in high volume manufacturing of our trucks. We do not know whether we will be able to develop efficient, automated, low-cost manufacturing capabilities andprocesses, and reliable sources of component supply, that will enable us to meet the quality, price, engineering, designand production standards, as well as the production volumes, required to successfully mass market our trucks. Even if we are successful in developing our high volume manufacturing capability andprocesses and reliably source our component supply, we do not know whether we will be able to do so in a manner that avoids significant delays and cost overruns, including as a result of factorsbeyond our control such as problems with suppliers and vendors, or in time to meet our vehicle commercialization schedules or to satisfy the requirements of customers. Any failure to develop suchmanufacturing processes and capabilities within our projected costs and timelines could have a material adverse effect on our business, prospects, operating results and financial condition.

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

        Any delay in the financing, design, manufacture and launch of our trucks, including in the build out of our planned manufacturing plant, couldmaterially damage our brand, business, prospects, financial condition and operating results. Vehicle manufacturers often experience delays in the design, manufacture and commercial release of newproducts. To the extent we delay the launch of our trucks, our growth prospects could be adversely affected as we may fail to grow our market share. Furthermore, we rely on third party suppliers forthe provision and development of many of the key components and materials used in our vehicles. To the extent our suppliers experience any delays in providing us with or developing necessarycomponents, we could experience delays in delivering on our timelines.

We will rely on complex machinery for our operations and production involves a significant degree of risk anduncertainty in terms of operational performance and costs.

        We will rely heavily on complex machinery for our operations and our production will involve a significant degree of uncertainty and risk interms of operational performance and costs. Our truck manufacturing plant will consist of large-scale machinery combining many components. The manufacturing plant components are likely to sufferunexpected malfunctions from time to time and will depend on repairs and spare parts to resume operations, which may not be available when needed. Unexpected malfunctions of the manufacturing plantcomponents may significantly affect the intended operational efficiency. Operational performance and costs can be difficult to predict and are often influenced by factors outside of our control, suchas, but not limited to, scarcity of natural resources, environmental hazards and remediation, costs associated with decommissioning of machines, labor disputes and strikes, difficulty or delays inobtaining governmental permits, damages or defects inelectronic systems, industrial accidents, fire, and seismic activity and natural disasters. Should operational risks materialize, it may result in the personal injury to or death of workers, the lossof production equipment, damage to manufacturing facilities, monetary losses, delays and unanticipated fluctuations in production, environmental damage, administrative fines, increased insurance costsand potential legal liabilities, all which could have a material adverse effect on our business, results of operations, cash flows, financial condition or prospects.

If our planned manufacturing plant in Arizona becomes inoperable, we will be unable to produce our trucks andour business will be harmed.

        We expect to begin assembly of our trucks at our manufacturing plant in Arizona after completion of the initial phase of the plant in 2021, atthe earliest. We expect to produce all of our trucks at our manufacturing plant in Arizona after completion of the second phase of the plant in 2023, at the earliest. Our plant and the equipment weuse to manufacture our trucks would be costly to replace and could require substantial lead time to replace and qualify for use. Our plant may be harmed or rendered inoperable by natural or man-madedisasters, including earthquakes, flooding, fire and power outages, or by health epidemics, such as the recent COVID-19 pandemic, which may render it difficult or impossible for us to manufacture ourtrucks for some period of time. The inability to produce our trucks or the backlog that could develop if our manufacturing plant is inoperable for even a short period of time may result in the loss ofcustomers or harm our reputation. Although we maintain insurance for damage to our property and the disruption of our business, this insurance may not be sufficient to cover all of our potentiallosses and may not continue to be available to us on acceptable terms, if at all.

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Our plan to build a network of hydrogen fueling stations will require significant cash investments andmanagement resources and may not meet our expectations with respect to additional sales of our electric vehicles. In addition, we may not be able to open stations in certain states.

        Our plan to build a network of hydrogen fueling stations in the United States will require significant cash investments and management resourcesand may not meet our expectations with respect to additional sales of our FCEV trucks. This planned construction of hydrogen stations is essential to persuading customers to pay a higher premium forour trucks. While we have constructed a prototype station, we have very limited experience in the actual provision of our refueling solutions to users and providing these services is subject tochallenges, which include the logistics of rolling out our network of refueling stations and teams in appropriate areas, inadequate capacity or over capacity incertain areas, security risks, risk of damage to vehicles during charging or refueling and the potential for lack of customer acceptance of our services. We will need to ensure compliance with anyregulatory requirements applicable in jurisdictions where our fueling stations will be located, including obtaining any required permits and land use rights, which could take considerable time andexpense and is subject to the risk that government support in certain areas may be discontinued. In addition, given our lack of experience building and operating fueling stations, there could beunanticipated challenges which may hinder our ability to provide our bundled lease to customers or make the provision of our bundled leases costlier than anticipated. If we are unable to build, orexperience delays in building, our network of hydrogen fueling stations, we may be unable to meet our fueling commitments under our bundled lease arrangements with customers and experience decreasedsales or leases of our vehicles, which may negatively impact our business, prospects, financial condition and operating results.

We may not be able to produce or source the hydrogen needed to establish our planned hydrogen fuelingstations.

        As a key component of our business model, we intend to establish a series of hydrogen fueling stations, and we intend to include the cost ofhydrogen in the purchase price of our trucks. We intend to produce the hydrogen needed for these stations on site through electrolysis. To the extent we are unable to produce the hydrogen, we may beunable to establish these fueling stations and severely limit the usefulness of our trucks, or, if we are still able to establish these stations, we may be forced to sell hydrogen at a loss in orderto maintain our commitments. We believe that this hydrogen incentive will be a significant driver for purchases of our trucks, and therefore, the failure to establish and roll out these hydrogenfueling stations in accordance with our expectations would materially adversely affect our business.

Our inability to cost-effectively source the energy requirements to conduct electrolysis at our fuelingstations may impact the profitability of our bundled leases by making our hydrogen uneconomical compared to other vehicle fuel sources.

        Our ability to economically produce hydrogen for our FCEV trucks requires us to secure a reliable source of electricity for each of our fuelingstations at a price per kilowatt hour that is below the current retail rates in the geographic areas we target. An increase in the price of energy used to generate hydrogen through electrolysis wouldlikely result in a higher cost of fuel for our FCEV trucks as well as increase the cost of distribution, freight and delivery and other operating costs related to vehicle manufacturing. We may not beable to offset these cost increases or pass such cost increases onto customers in the form of price increases, because of our bundled lease model for FCEV trucks, which could have an adverse impact onour results of operations and financial condition.

Reservations for our trucks are cancellable.

        As of December 31, 2019, we had reservations for 14,000 Nikola Two FCEV trucks, all of which are subject to cancellation by the customeruntil the customer enters into a lease agreement. At times

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wehave indicated that if we are able to sell or lease every truck which has been reserved, we would have $10 billion in projected revenues. Because all of our reservations are cancellable, itis possible that a significant number of customers who submitted reservations for our trucks may cancel those reservations.

        Giventhe anticipated lead times between customer reservation and delivery of our trucks, there is a heightened risk that customers that have made reservations may not ultimately takedelivery of vehicles due to potential changes in customer preferences, competitive developments and other factors. As a result, no assurance can be made that reservations will not be cancelled, orthat reservations will ultimately result in the purchase or lease of a vehicle. Any cancellations could harm our financial condition, business, prospects and operating results.

        Inaddition, the $10 billion in projected revenues is based on a number of assumptions, including a projected purchase price for our trucks. If the purchase price of the trucksends up being different than anticipated, we may not achieve this level of revenues, even if all of the trucks subject to reservations are sold or leased.

        Whilewe currently have a contract with Anheuser-Busch LLC ("AB"), to lease up to 800 Nikola Two FCEV trucks, if we are unable to deliver our trucks according to the vehiclespecifications and delivery timelines set forth in the contract, AB has the right to cancel its order for trucks. Moreover, the AB contract specifies lease terms and rental rates that may be hard forus to meet depending on our ability to develop our trucks and hydrogen network according to current design parameters and cost estimates. Any of these adverse actions related to the AB order couldharm our financial condition, business, prospects and operating results.

While we do not currently have any leasing arrangements finalized, in the future we intend to offer a bundledleasing alternative to customers which exposes us to credit risk.

        While we currently intend to offer bundled leasing of our trucks to potential customers through a third-party financing partner, we currentlyhave no agreement in place with any potential financing partner. We can provide no assurance that a third-party financing partner would be able or willing to provide the leasing services on terms thatwe have stated in our published materials, or to provide financing at all. Furthermore, offering a leasing alternative to customers will expose us to risks commonly associated with the extension ofcredit. Credit risk is the potential loss that may arise from any failure in the ability or willingness of the customer to fulfil its contractual obligations when they fall due. Competitive pressureand challenging markets may increase credit risk through leases to financially weak customers, extended payment terms and leases into new and immature markets. This could have a material adverseeffect on our business, prospects, financial results and results of operations.

We face significant barriers to produce our trucks, and if we cannot successfully overcome those barriers ourbusiness will be negatively impacted.

        The trucking industry has traditionally been characterized by significant barriers to entry, including large capital requirements, investmentcosts of designing and manufacturing vehicles, long lead times to bring vehicles to market from the concept and design stage, the need for specialized design and development expertise, regulatoryrequirements, establishing a brand name and image and the need to establish sales, leasing, fueling and service locations. If we are not able to overcome these barriers, our business, prospects,operating results and financial condition will be negatively impacted and our ability to grow our business will be harmed.

Our future growth is dependent upon the trucking industry's willingness to adopt BEV and FCEV trucks.

        Our growth is highly dependent upon the adoption by the trucking industry of alternative fuel and electric trucks. If the market for our BEV andFCEV trucks does not develop at the rate or to the

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extentthat we expect, our business, prospects, financial condition and operating results will be harmed. The market for alternative fuel and electric trucks is new and untested and is characterizedby rapidly changing technologies, price competition, numerous competitors, evolving government regulation and industry standards and uncertain customer demands and behaviors.

        Factorsthat may influence the adoption of alternative fuel and electric vehicles include:

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perceptions about BEV or FCEV truck quality, safety, design, performance and cost, especially if adverse events or accidents occur that arelinked to the quality or safety of alternative fuel or electric vehicles;



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perceptions about vehicle safety in general, including the use of advanced technology, such as vehicle electronics, hydrogen fueling andstorage and regenerative braking systems;



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the decline of vehicle efficiency resulting from deterioration over time in the ability of the battery to hold a charge;



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concerns about the availability of hydrogen stations, including those we plan to develop and deploy, which could impede our present efforts topromote FCEV trucks as a desirable alternative to diesel trucks;



•

improvements in the fuel economy of internal combustion engines;



•

the availability of service for alternative fuel or electric trucks;



•

volatility in the cost of energy, oil, gasoline and hydrogen;



•

government regulations and economic incentives promoting fuel efficiency and alternate forms of energy;



•

the availability of tax and other governmental incentives to purchase and operate alternative fuel and electric trucks or future regulationrequiring increased use of nonpolluting trucks;



•

our ability to sell or lease trucks directly to business or customers dependent on state by state unique regulations and dealership laws;



•

the availability of tax and other governmental incentives to sell hydrogen;



•

perceptions about and the actual cost of alternative fuel; and



•

macroeconomic factors.

        Additionally,we may become subject to regulations that may require us to alter the design of our trucks, which could negatively impact customer interest in our products.

If our trucks fail to perform as expected, our ability to develop, market and sell or lease our alternativefuel and electric trucks could be harmed.

        Once production commences, our trucks may contain defects in design and manufacture that may cause them not to perform as expected or mayrequire repair. We currently have no frame of reference by which to evaluate the performance of our trucks upon which our business prospects depend. For example, our trucks will use a substantialamount of software to operate which will require modification and updates over the life of the vehicle. Software products are inherently complex and often contain defects and errors when firstintroduced.

        Therecan be no assurance that we will be able to detect and fix any defects in the trucks' hardware or software prior to commencing customer sales. We may experience recalls in thefuture, which could adversely affect our brand in our target markets and could adversely affect our business, prospects and results of operations. Our trucks may not perform consistent with customers'

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expectationsor consistent with other vehicles which may become available. Any product defects or any other failure of our trucks to perform as expected could harm our reputation and result in adversepublicity, lost revenue, delivery delays, product recalls, product liability claims and significant warranty and other expenses, and could have a material adverse impact on our business, financialcondition, operating results and prospects.

Although we hope to be among the first to bring BEV and FCEV class 8 semi-trucks to market,competitors may enter the market before our trucks, which could have an adverse effect on our business.

        We face intense competition in trying to be among the first to bring our BEV and FCEV truck platforms to market, including from companies in ourtarget markets with greater financialresources, more extensive development, manufacturing, marketing and service capabilities, greater brand recognition and a larger number of managerial and technical personnel. If competitor's trucksare brought to market before our trucks, we may experience a reduction in potential market share.

        Manyof our current and potential competitors, particularly international competitors, have significantly greater financial, technical, manufacturing, marketing and other resources thanwe do and may be able to devote greater resources to the design, development, manufacturing, distribution, promotion, sale and support of their products.

        Wecompete in a rapidly evolving and highly competitive industry, and a number of private and public companies have announced plans to offer BEV and/or FCEV semi-trucks, includingcompanies such as Daimler, Hyundai, Tesla, Toyota and Volvo. Based on publicly available information, a number of these competitors have displayed prototype trucks and have announced targetavailability and production timelines, while others have launched pilot programs in some markets. In addition, we are aware that one potential competitor, BYD, is currently manufacturing and selling aClass 8 BEV truck. While some competitors may choose to offer BEV trucks, others such as Hyundai have announced they plan to offer FCEV trucks and invest in hydrogen stations for refueling. Inaddition, our principal competition for our trucks will also come from manufacturers of trucks with internal combustion engines powered by diesel fuel.

        Weexpect competition in our industry to intensify in the future in light of increased demand and regulatory push for alternative fuel and electric vehicles. We cannot provide assurancesthat our trucks will be among the first to market, or that competitors will not build hydrogen fueling stations. Even if our trucks are among the first to market, we cannot assure you that customerswill choose our vehicles over those of our competitors, or over diesel powered trucks.

Developments in alternative technology improvements in the internal combustion engine may adversely affectthe demand for our trucks.

        Significant developments in alternative technologies, such as advanced diesel, ethanol, or compressed natural gas or improvements in the fueleconomy of the internal combustion engine, may materially and adversely affect our business and prospects in ways we do not currently anticipate. Other fuels or sources of energy may emerge ascustomers' preferred alternative to our truck platform. Any failure by us to develop new or enhanced technologies or processes, or to react to changes in existing technologies, could materially delayour development and introduction of new and enhanced alternative fuel and electric trucks, which could result in the loss of competitiveness of our trucks, decreased revenue and a loss of market shareto competitors. Our research and development efforts may not be sufficient to adapt to changes in alternative fuel and electric vehicle technology. As technologies change, we plan to upgrade or adaptour trucks and introduce new models in order to continue to provide trucks with the latest technology, in particular battery cell technology.

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We have no experience servicing our vehicles. If we are unable to address the service requirements of ourcustomers, our business will be materially and adversely affected.

        Because we do not plan to begin production of our trucks until 2021 at the earliest, we have no experience servicing or repairing our vehicles.Servicing alternative fuel and electric vehicles is different than servicing vehicles with internal combustion engines and requires specialized skills, including high voltage training and servicingtechniques. We may decide to partner with a third party to perform some or all of the maintenance on our trucks, and there can be no assurance that we will be able to enter into an acceptablearrangement with any such third-party provider. If we are unable to successfully address the service requirements of our customers, our business and prospects will be materially and adverselyaffected.

        Inaddition, the motor vehicle industry laws in many states require that service facilities be available to service vehicles physically sold from locations in the state. While weanticipate developing a service program that would satisfy regulators in these circumstances, the specifics of our service program arestill in development, and at some point may need to be restructured to comply with state law, which may impact on our business, financial condition, operating results and prospects.

Future product recalls could materially adversely affect our business, prospects, operating results andfinancial condition.

        Any product recall in the future may result in adverse publicity, damage our brand and materially adversely affect our business, prospects,operating results and financial condition. In the future, we may voluntarily or involuntarily, initiate a recall if any of our vehicles or electric powertrain components (including the fuel cell orbatteries) prove to be defective or noncompliant with applicable federal motor vehicle safety standards. Such recalls involve significant expense and diversion of management attention and otherresources, which could adversely affect our brand image in our target markets, as well as our business, prospects, financial condition and results of operations.

Insufficient warranty reserves to cover future warranty claims could materially adversely affect ourbusiness, prospects, financial condition and operating results.

        Once our trucks are in production, we will need to maintain warranty reserves to cover warranty-related claims. If our warranty reserves areinadequate to cover future warranty claims on our vehicles, our business, prospects, financial condition and operating results could be materially and adversely affected. We may become subject tosignificant and unexpected warranty expenses. There can be no assurances that then-existing warranty reserves will be sufficient to cover all claims.

If we are unable to attract and retain key employees and hire qualified management, technical and vehicleengineering personnel, our ability to compete could be harmed.

        Our success depends, in part, on our ability to retain our key personnel. The unexpected loss of or failure to retain one or more of our keyemployees could adversely affect our business. Our success also depends, in part, on our continuing ability to identify, hire, attract, train and develop other highly qualified personnel.

        Competitionfor these employees can be intense, and our ability to hire, attract and retain them depends on our ability to provide competitive compensation. We may not be able toattract, assimilate, develop or retain qualified personnel in the future, and our failure to do so could adversely affect ourbusiness, including the execution of our global business strategy. Any failure by our management team to perform as expected may have a material adverse effect on our business, prospects, financialcondition and results of operations.

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We are highly dependent on the services of Trevor R. Milton, our Executive Chairman.

        We are highly dependent on the services of Trevor R. Milton, our Executive Chairman, and largest stockholder. Mr. Milton is the source ofmany, if not most, of the ideas and execution driving Nikola. If Mr. Milton were to discontinue his service to us due to death, disability or any other reason, we would be significantlydisadvantaged.

Increases in costs, disruption of supply or shortage of raw materials, particularly lithium-ion batterycells, could harm our business.

        Once we begin commercial production of vehicles, we may experience increases in the cost or a sustained interruption in the supply or shortageof raw materials. Any such increase or supply interruption could materially negatively impact our business, prospects, financial condition and operating results. We use various raw materials includingaluminum, steel, carbon fiber, non-ferrous metals (such as copper), and cobalt. The prices for these raw materials fluctuate depending on market conditions and global demand and could adversely affectour business and operating results. For instance, we are exposed to multiple risks relating to price fluctuations for lithium-ion cells. These risks include:

•

the inability or unwillingness of current battery manufacturers to build or operate battery cell manufacturing plants to supply the numbers oflithium-ion cells required to support the growth of the electric vehicle industry as demand for such cells increases;



•

disruption in the supply of cells due to quality issues or recalls by the battery cell manufacturers; and



•

an increase in the cost of raw materials, such as cobalt, used in lithium-ion cells.

        Anydisruption is the supply of battery cells could temporarily disrupt production of the Nikola Tre BEV truck until a different supplier is fully qualified. Moreover, battery cellmanufacturers may refuse to supply electric vehicle manufacturers if they determine that the vehicles are not sufficiently safe. Furthermore, fluctuations or shortages in petroleum and other economicconditions may cause us to experience significant increases in freight charges and raw material costs. Substantial increases in the prices for our raw materials would increase our operating costs andcould reduce our margins if the increased costs cannot be recouped through increased electric vehicle prices. There can be no assurance that we will be able to recoup increasing costs of raw materialsby increasing vehicle prices.

Manufacturing in collaboration with partners is subject to risks.

        In 2019, we partnered with Iveco, a subsidiary of CNHI, to manufacture the Nikola Tre truck at the Iveco manufacturing plant in Ulm, Germanythrough a joint venture with CNHI, which is expected to commence operations in the third quarter of 2020. We currently intend to begin production of the Nikola Tre BEV at the Iveco plant in 2021, withdeliveries beginning in the same year. We expect that 40 million Euros will be invested into the manufacturing plant to prepare it for assembly. Collaboration with third parties for themanufacturing of trucks is subject to risks with respect to operations that are outside our control. We could experience delays if our partners do not meet agreed upon timelines or experience capacityconstraints. There is risk of potential disputes with partners, and we could be affected by adverse publicity related to our partners whether or not such publicity is related to their collaborationwith us. Our ability to successfully build a premium brand could also be adversely affected by perceptions about the quality of our partners' products. In addition, although we are involved in eachstep of the supply chain and manufacturing process, because we also rely on our partners and third parties to meet our quality standards, there can be no assurance that we will successfully maintainquality standards.

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        Wemay be unable to enter into new agreements or extend existing agreements with manufacturers on terms and conditions acceptable to us and therefore may need to contract with otherthird parties or significantly add to our own production capacity. There can be no assurance that in such event we would be able to engage other third parties or establish or expand our own productioncapacity to meet our needs on acceptable terms or at all. The expense and time required to complete any transition, and to assure that vehicles manufactured at facilities of new manufacturers complywith our quality standards and regulatory requirements, may be greater than anticipated. Any of the foregoing could adversely affect our business, results of operations, financial condition andprospects.

We are or may be subject to risks associated with strategic alliances or acquisitions.

        We have entered into, and may in the future enter into additional, strategic alliances, including joint ventures or minority equity investmentswith various third parties to further our business purpose. These alliances could subject us to a number of risks, including risks associated with sharing proprietary information, non-performance bythe third party and increased expenses in establishing new strategic alliances, any of which may materially and adversely affect our business. We may have limited ability to monitor or control theactions of these third parties and, to the extent any of these strategic third parties suffers negative publicity or harm to their reputation from events relating to their business, we may also suffernegative publicity or harm to our reputation by virtue of our association with any such third party.

        Whenappropriate opportunities arise, we may acquire additional assets, products, technologies or businesses that are complementary to our existing business. In addition to possiblestockholder approval, we may need approvals and licenses from relevant government authorities for the acquisitions and to comply with any applicable laws and regulations, which could result inincreased delay and costs, and may disrupt our business strategy if we fail to do so. Furthermore, acquisitions and the subsequent integration of new assets and businesses into our own requiresignificant attention from our management and could result in a diversion of resources from our existing business, which in turn could have an adverse effect on our operations. Acquired assets orbusinesses may not generate the financial results we expect. Acquisitions could result in the use of substantial amounts of cash, potentially dilutive issuances of equity securities, the occurrence ofsignificant goodwill impairment charges, amortization expenses for other intangible assets and exposure to potential unknown liabilities of the acquired business. Moreover, the costs of identifyingand consummating acquisitions may be significant.

We are dependent on our suppliers, a significant number of which are single or limited source suppliers, andthe inability of these suppliers to deliver necessary components of our vehicles at prices and volumes acceptable to us would have a material adverse effect on our business, prospects and operatingresults.

        While we plan to obtain components from multiple sources whenever possible, many of the components used in our vehicles will be purchased by usfrom a single source, especially with respect to hydrogen fuel cells and batteries. We refer to these component suppliers as our single source suppliers. While we believe that we may be able toestablish alternate supply relationships and can obtain or engineer replacement components for our single source components, we may be unable to do so in the short term (or at all) at prices orquality levels that are favorable to us.

        Asignificant benefit of our joint venture with Iveco is the ability to leverage Iveco's existing assortment of parts, thereby decreasing our purchasing expenses. While this relationshipgives us access to use an existing supplier base with the hopes of accelerating procurement of components at favorable prices, there is no guarantee that this will be the case. In addition, we couldexperience delays if our suppliers do not meet agreed upon timelines or experience capacity constraints.

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The battery efficiency of electric trucks will decline over time, which may negatively influence potentialcustomers' decisions whether to purchase our trucks.

        We anticipate the range of our BEV and FCEV vehicles to be up to 400 to 750 miles before needing to refuel, but that range will decline overtime as the battery deteriorates. We currently expect a 3% to 4% decline in the battery life per year, which will decrease the range of our trucks over 5 years by approximately 20%. Otherfactors such as usage, time and stress patterns may also impact the battery's ability to hold a charge, which would decrease our trucks' range before needing to refuel. Such battery deterioration andthe related decrease in range may negatively influence potential customer decisions.

Our trucks will make use of lithium-ion battery cells, which have been observed to catch fire or vent smokeand flame.

        The battery packs within our trucks will make use of lithium-ion cells. On rare occasions, lithium-ion cells can rapidly release the energy theycontain by venting smoke and flames in a manner that can ignite nearby materials as well as other lithium-ion cells. While the battery pack is designed to contain any single cell's release of energywithout spreading to neighboring cells, once our trucks are commercially available, a field or testing failure of our vehicles or other battery packs that we produce could occur, which could subjectus to lawsuits, product recalls, or redesign efforts, all of which would be time consuming and expensive. Also, negative public perceptions regarding the suitability of lithium-ion cells forautomotive applications or any future incident involving lithium-ion cells, such as a vehicle or other fire, even if such incident does not involve our trucks, could seriously harm our business andreputation.

        Inaddition, once we begin manufacturing our trucks, we will need to store a significant number of lithium-ion cells at our facility. Any mishandling of battery cells may causedisruption to the operation of our facility. While we have implemented safety procedures related to the handling of the cells, a safety issue or fire related to the cells could disrupt our operations.Such damage or injury could lead to adverse publicity and potentially a safety recall. Moreover, any failure of a competitor's electric vehicle or energy storage product may cause indirect adversepublicity for us and our products. Such adverse publicity could negatively affect our brand and harm our business, prospects, financial condition and operating results.

Any unauthorized control or manipulation of our vehicles' systems could result in loss of confidence in usand our vehicles and harm our business.

        Our trucks contain complex information technology systems and built-in data connectivity to accept and install periodic remote updates toimprove or update functionality. We have designed, implemented and tested security measures intended to prevent unauthorized access to our information technology networks, our trucks and relatedsystems. However, hackers may attempt to gain unauthorized access to modify, alter and use such networks, trucks and systems to gain control of or to change our trucks' functionality, user interfaceand performance characteristics, or to gain access to data stored in or generated by the truck. Future vulnerabilities could be identified and our efforts to remediate such vulnerabilities may not besuccessful. Any unauthorized access to or control of our trucks or their systems, or any loss of customer data, could result in legal claims or proceedings. In addition, regardless of their veracity,reports of unauthorized access to our trucks, systems or data, as well as other factors that may result in the perception that our trucks, systems or data are capable of being "hacked," couldnegatively affect our brand and harm our business, prospects, financial condition and operating results.

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Interruption or failure of our information technology and communications systems could impact our ability toeffectively provide our services.

        We plan to outfit our trucks with in-vehicle services and functionality that utilize data connectivity to monitor performance and timely captureopportunities for cost-saving preventative maintenance. The availability and effectiveness of our services depend on the continued operation of information technology and communications systems, whichwe have yet to develop. Our systems will be vulnerable to damage or interruption from, among others, fire, terrorist attacks, natural disasters, power loss, telecommunications failures, computerviruses, computer denial of service attacks or other attempts to harm our systems. Our data centers could also be subject to break-ins, sabotage and intentional acts of vandalism causing potentialdisruptions. Some of our systems will not be fully redundant, and our disaster recovery planning cannot account for all eventualities. Any problems at our data centers could result in lengthyinterruptions in our service. In addition, our trucks are highly technical and complex and may contain errors or vulnerabilities, which could result in interruptions in our business or the failure ofour systems.

We are subject to substantial regulation and unfavorable changes to, or failure by us to comply with, theseregulations could substantially harm our business and operating results.

        Our alternative fuel and electric trucks, and the sale of motor vehicles in general, are subject to substantial regulation under international,federal, state, and local laws. We expect to incur significant costs in complying with these regulations. Regulations related to the electric vehicle industry and alternative energy are currentlyevolving and we face risks associated with changes to these regulations, including but not limited to:

•

increased subsidies for corn and ethanol production, which could reduce the operating cost of vehicles that use ethanol or a combination ofethanol and gasoline; and



•

increased sensitivity by regulators to the needs of established automobile manufacturers with large employment bases, high fixed costs andbusiness models based on the internal combustion engine, which could lead them to pass regulations that could reduce the compliance costs of such established manufacturers or mitigate the effects ofgovernment efforts to promote alternative fuel vehicles.

        Tothe extent the laws change, our trucks may not comply with applicable international, federal, state or local laws, which would have an adverse effect on our business. Compliance withchanging regulations could be burdensome, time consuming, and expensive. To the extent compliance with new regulations is cost prohibitive, our business, prospects, financial condition and operatingresults would be adversely affected.

We are subject to various environmental laws and regulations that could impose substantial costs upon us andcause delays in building our manufacturing facilities.

        Our operations, will be subject to international, federal, state, and/or local environmental laws and regulations, including laws relating tothe use, handling, storage, disposal and human exposure to hazardous materials. Environmental and health and safety laws and regulations can be complex, and we expect that we will be affected byfuture amendments to such laws or other new environmental and health and safety laws and regulations which may require us to change our operations, potentially resulting in a material adverse effecton our business, prospects, financial condition, and operating results. These laws can give rise to liability for administrative oversight costs, cleanup costs, property damage, bodily injury andfines and penalties. Capital and operating expenses needed to comply with environmental laws and regulations can be significant, and violations may result in substantial fines and penalties, thirdparty damages, suspension of production or a cessation of our operations.

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        Contaminationat properties we will own and operate, we formerly owned or operated or to which hazardous substances were sent by us, may result in liability for us under environmentallaws and regulations, including, but not limited to the Comprehensive Environmental Response, Compensation and Liability Act, or CERCLA, which can impose liability for the full amount ofremediation-related costs without regard to fault, for the investigation and cleanup of contaminated soil and ground water, for building contamination and impacts to human health and for damages tonatural resources. The costs of complying with environmental laws and regulations and any claims concerning noncompliance, or liability with respect to contamination in the future, could have amaterial adverse effect on our financial condition or operating results. We may face unexpected delays in obtaining the requiredpermits and approvals in connection with our planned manufacturing facilities that could require significant time and financial resources and delay our ability to operate these facilities, which wouldadversely impact our business prospects and operating results.

We intend to retain certain personal information about our customers and may be subject to various privacylaws.

        We intend to use our trucks' electronic systems to log information about each vehicle's use in order to aid us in vehicle diagnostics, repairand maintenance. Our customers may object to the use of this data, which may increase our vehicle maintenance costs and harm our business prospects. Possession and use of our customers' information inconducting our business may subject us to legislative and regulatory burdens in the United States and the European Union that could require notification of data breaches, restrict our use of suchinformation and hinder our ability to acquire new customers or market to existing customers. Non-compliance or a major breach of our network security and systems could have serious negativeconsequences for our business and future prospects, including possible fines, penalties and damages, reduced customer demand for our vehicles, and harm to our reputation and brand.

We face risks associated with our international operations, including unfavorable regulatory, political, taxand labor conditions, which could harm our business.

        We face risks associated with our international operations, including possible unfavorable regulatory, political, tax and labor conditions,which could harm our business. We anticipate having international operations and subsidiaries in Germany, Austria, and Italy that are subject to the legal, political, regulatory and socialrequirements and economic conditions in these jurisdictions. Additionally, as part of our growth strategy, we intend to expand our sales, maintenance and repair services internationally. However, wehave no experience to date selling and servicing our vehicles internationally and such expansion would require us to make significant expenditures, including the hiring of local employees andestablishing facilities, in advance of generating any revenue. We are subject to a number of risks associated with international business activities that may increase our costs, impact our ability tosell our alternative fuel and electric trucks and require significant management attention. These risks include:

•

conforming our trucks to various international regulatory requirements where our trucks are sold, or homologation;



•

development and construction of our hydrogen refueling network;



•

difficulty in staffing and managing foreign operations;



•

difficulties attracting customers in new jurisdictions;



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foreign government taxes, regulations and permit requirements, including foreign taxes that we may not be able to offset against taxes imposedupon us in the United States, and foreign tax and other laws limiting our ability to repatriate funds to the United States;

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•

fluctuations in foreign currency exchange rates and interest rates, including risks related to any interest rate swap or other hedgingactivities we undertake;



•

United States and foreign government trade restrictions, tariffs and price or exchange controls;



•

foreign labor laws, regulations and restrictions;



•

changes in diplomatic and trade relationships;



•

political instability, natural disasters, war or events of terrorism; and



•

the strength of international economies.

        Ifwe fail to successfully address these risks, our business, prospects, operating results and financial condition could be materially harmed.

We face risks related to health epidemics, including the recent COVID-19 pandemic, which could have amaterial adverse effect on our business and results of operations.

        We face various risks related to public health issues, including epidemics, pandemics, and other outbreaks, including the recent pandemic ofrespiratory illness caused by a novel coronavirus known as COVID-19. The impact of COVID-19, including changes in consumer and business behavior, pandemic fears and market downturns, and restrictionson business and individual activities, has created significant volatility in the global economy and led to reduced economic activity. The spread of COVID-19 has also created a disruption in themanufacturing, delivery and overall supply chain of vehicle manufacturers and suppliers, and has led to a global decrease in vehicle sales in markets around the world.

        Thepandemic has resulted in government authorities implementing numerous measures to try to contain the virus, such as travel bans and restrictions, quarantines, stay-at-home orshelter-in-place orders, and business shutdowns. These measures may adversely impact our employees and operations and the operations of our customers, suppliers, vendors and business partners, and maynegatively impact our sales and marketing activities, the construction schedule of our hydrogen fueling stations and our manufacturing plant in Arizona, and the production schedule of our trucks. Inaddition, various aspects of our business, manufacturing plant and hydrogen fueling station building process, cannot be conducted remotely. These measures by government authorities may remain in placefor asignificant period of time and they are likely to continue to adversely affect our manufacturing and building plans, sales and marketing activities, business and results of operations.

        Thespread of COVID-19 has caused us to modify our business practices (including employee travel, recommending that all non-essential personnel work from home and cancellation orreduction of physical participation in sales activities, meetings, events and conferences), and we may take further actions as may be required by government authorities or that we determine are in thebest interests of our employees, customers, suppliers, vendors and business partners. There is no certainty that such actions will be sufficient to mitigate the risks posed by the virus or otherwisebe satisfactory to government authorities. If significant portions of our workforce are unable to work effectively, including due to illness, quarantines, social distancing, government actions orother restrictions in connection with the COVID-19 pandemic, our operations will be impacted.

        Theextent to which the COVID-19 pandemic impacts our business, prospects and results of operations will depend on future developments, which are highly uncertain and cannot bepredicted, including, but not limited to, the duration and spread of the pandemic, its severity, the actions to contain the virus or treat its impact, and how quickly and to what extent normaleconomic and operating activities can resume. The COVID-19 pandemic could limit the ability of our customers, suppliers, vendors and business partners to perform, including third party suppliers'ability to provide components and materials used in our trucks. We may also experience an increase in the cost of raw

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materialsused in our commercial production of trucks. Even after the COVID-19 pandemic has subsided, we may continue to experience an adverse impact to our business as a result of its global economicimpact, including any recession that has occurred or may occur in the future.

        Specifically,difficult macroeconomic conditions, such as decreases in per capita income and level of disposable income, increased and prolonged unemployment or a decline in consumerconfidence as a result of the COVID-19 pandemic, as well as reduced spending by businesses, could have a material adverse effect on the demand for our trucks. Under difficult economic conditions,potential customers may seek to reduce spending by forgoing our trucks for other traditional options, and cancel reservations for our trucks. Decreased demand for our trucks, particularly in theUnited States and Europe, could negatively affect our business.

        Thereare no comparable recent events which may provide guidance as to the effect of the spread of COVID-19 and a pandemic, and, as a result, the ultimate impact of the COVID-19 pandemicor a similar health epidemic is highly uncertain and subject to change. We do not yet know the full extent of COVID-19's impact on our business, our operations, or the global economy as a whole.However, theeffects could have a material impact on our results of operations, and we will continue to monitor the situation closely.

The unavailability, reduction or elimination of government and economic incentives could have a materialadverse effect on our business, prospects, financial condition and operating results.

        Any reduction, elimination or discriminatory application of government subsidies and economic incentives because of policy changes, the reducedneed for such subsidies and incentives due to the perceived success of the electric vehicle or other reasons may result in the diminished competitiveness of the alternative fuel and electric vehicleindustry generally or our battery-electric vehicles and fuel cell electric vehicles trucks in particular. This could materially and adversely affect the growth of the alternative fuel automobilemarkets and our business, prospects, financial condition and operating results.

        Whilecertain tax credits and other incentives for alternative energy production, alternative fuel and electric vehicles have been available in the past, there is no guarantee theseprograms will be available in the future. If current tax incentives are not available in the future, our financial position could be harmed.

We may not be able to obtain or agree on acceptable terms and conditions for all or a significant portion ofthe government grants, loans and other incentives for which we may apply. As a result, our business and prospects may be adversely affected.

        We anticipate applying for federal and state grants, loans and tax incentives under government programs designed to stimulate the economy andsupport the production of alternative fuel and electric vehicles and related technologies, as well as the sale of hydrogen. For example, we intend to initially build our hydrogen fueling stations inCalifornia, in part because of the incentives that are available. We anticipate that in the future there will be new opportunities for us to apply for grants, loans and other incentives from theUnited States, state and foreign governments. Our ability to obtain funds or incentives from government sources is subject to the availability of funds under applicable government programs andapproval of our applications to participate in such programs. The application process for these funds and other incentives will likely be highly competitive. We cannot assure you that we will besuccessful in obtaining any of these additional grants, loans and other incentives. If we are not successful in obtaining any of these additional incentives and we are unable to find alternativesources of funding to meet our planned capital needs, our business and prospects could be materially adversely affected.

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We may need to defend ourselves against patent or trademark infringement claims, which may be time-consumingand cause us to incur substantial costs.

        Companies, organizations or individuals, including our competitors, may own or obtain patents, trademarks or other proprietary rights that wouldprevent or limit our ability to make, use, develop or sell our vehicles or components, which could make it more difficult for us to operate our business. We may receive inquiries from patent ortrademark owners inquiring whether we infringe their proprietary rights. Companies owning patents or other intellectual property rights relating to battery packs, electric motors, fuel cells orelectronic power management systems may allege infringement of such rights. In response to a determination that we have infringed upon a third party's intellectual property rights, we may be requiredto do one or more of the following:

•

cease development, sales, or use of vehicles that incorporate the asserted intellectual property;



•

pay substantial damages;



•

obtain a license from the owner of the asserted intellectual property right, which license may not be available on reasonable terms or at all;or



•

redesign one or more aspects or systems of our trucks.

        Asuccessful claim of infringement against us could materially adversely affect our business, prospects, operating results and financial condition. Any litigation or claims, whethervalid or invalid, could result in substantial costs and diversion of resources.

        Wealso plan to license patents and other intellectual property from third parties, including suppliers and service providers, and we may face claims that our use of this in-licensedtechnology infringes the intellectual property rights of others. In such cases, we will seek indemnification from our licensors. However, our rights to indemnification may be unavailable orinsufficient to cover our costs and losses.

Our business may be adversely affected if we are unable to protect our intellectual property rights fromunauthorized use by third parties.

        Failure to adequately protect our intellectual property rights could result in our competitors offering similar products, potentially resultingin the loss of some of our competitive advantage, and a decrease in our revenue which would adversely affect our business, prospects, financial condition and operating results. Our success depends, atleast in part, on our ability to protect our core technology and intellectual property. To accomplish this, we will rely on a combination of patents, trade secrets (including know-how), employee andthird-party nondisclosure agreements, copyright, trademarks, intellectual property licenses and other contractual rights to establish and protect our rights in our technology.

        Theprotection of our intellectual property rights will be important to our future business opportunities. However, the measures we take to protect our intellectual property fromunauthorized use by others may not be effective for various reasons, including the following:

•

any patent applications we submit may not result in the issuance of patents;



•

the scope of our issued patents may not be broad enough to protect our proprietary rights;



•

our issued patents may be challenged and/or invalidated by our competitors;



•

the costs associated with enforcing patents, confidentiality and invention agreements or other intellectual property rights may make aggressiveenforcement impracticable;



•

current and future competitors may circumvent our patents; and

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•

our in-licensed patents may be invalidated, or the owners of these patents may breach our license arrangements.

        Patent,trademark, and trade secret laws vary significantly throughout the world. Some foreign countries do not protect intellectual property rights to the same extent as do the laws ofthe United States. Further, policing the unauthorized use of our intellectual property in foreign jurisdictions may be difficult. Therefore, our intellectual property rights may not be as strong or aseasily enforced outside of the United States.

Our patent applications may not issue as patents, which may have a material adverse effect on our ability toprevent others from commercially exploiting products similar to ours.

        We cannot be certain that we are the first inventor of the subject matter to which we have filed a particular patent application, or if we arethe first party to file such a patent application. If another party has filed a patent application to the same subject matter as we have, we may not be entitled to the protection sought by the patentapplication. Further, the scope of protectionof issued patent claims is often difficult to determine. As a result, we cannot be certain that the patent applications that we file will issue, or that our issued patents will afford protectionagainst competitors with similar technology. In addition, our competitors may design around our issued patents, which may adversely affect our business, prospects, financial condition or operatingresults.

We may be subject to risks associated with autonomous driving technology.

        Our trucks will be designed with connectivity for future installation of an autonomous hardware suite and we plan to partner with a third-partysoftware provider in the future to implement autonomous capabilities. However, we cannot guarantee that we will be able to identify a third party to provide the necessary hardware and software toenable driverless Level 4 or Level 5 autonomy in an acceptable timeframe, on terms satisfactory to us, or at all. Autonomous driving technologies are subject to risks and there have beenaccidents and fatalities associated with such technologies. The safety of such technologies depends in part on user interaction and users, as well as other drivers on the roadways, may not beaccustomed to using or adapting to such technologies. To the extent accidents associated with our autonomous driving systems occur, we could be subject to liability, negative publicity, governmentscrutiny and further regulation. Any of the foregoing could materially and adversely affect our results of operations, financial condition and growth prospects.

The evolution of the regulatory framework for autonomous vehicles is outside of our control and we cannotguarantee that our trucks will achieve the requisite level of autonomy to enable driverless systems within our projected timeframe, if ever.

        There are currently no federal U.S. regulations pertaining to the safety of self-driving vehicles; however, the National Highway Traffic andSafety Administration has established recommended guidelines. Certain states have legal restrictions on self-driving vehicles, and many other states are considering them. This patchwork increases thedifficulty in legal compliance for our vehicles. In Europe, certain vehicle safety regulations apply to self-driving braking and steering systems, and certain treaties also restrict the legality ofcertain higher levels of self-driving vehicles. Self-driving laws and regulations are expected to continue to evolve in numerous jurisdictions in the U.S. and foreign countries and may restrictautonomous driving features that we may deploy.

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Risks Related to Ownership of Our Common Stock

Concentration of ownership among our existing executive officers, directors and their affiliates may preventnew investors from influencing significant corporate decisions.

        As of June 3, after giving effect to the Closing, each of Trevor R. Milton, our Executive Chairman, and Mark A. Russell, our Presidentand Chief Executive Officer, beneficially owns, directly or indirectly, approximately 25.4% and 13.5%, respectively, of our outstanding Common Stock, and our directors and executive officers as agroup beneficially own approximately 52.0% of our outstanding Common Stock. As a result, these stockholders will be able to exercise a significant level of control over all matters requiringstockholder approval, including the election of directors, any amendment of the Certificate of Incorporation and approval of significant corporate transactions. This control could have the effect ofdelaying or preventing a change of control or changes in management and will make the approval of certain transactions difficult or impossible without the support of these stockholders.

Sales of a substantial number of shares of our Common Stock in the public market could cause the price of ourCommon Stock to fall.

        Sales of a substantial number of shares of our Common Stock in the public market or the perception that these sales might occur could depressthe market price of our Common Stock and could impair our ability to raise capital through the sale of additional equity securities. We are unable to predict the effect that sales may have on theprevailing market price of our Common Stock. In addition, the sale of substantial amounts of our Common Stock could adversely impact its price.

        Theshares of Common Stock offered by the Selling Securityholders represent approximately 69.2% of our outstanding Common Stock, not including the shares of Common Stock underlying anyof our outstanding Warrants. Outstanding Warrants to purchase an aggregate of 23,000,000 shares of our Common Stock, which we refer to as the "Public Warrants," will become exercisable on the later tooccur of July 6, 2020 (as July 3, 2020 is a holiday) and the effectiveness of the registration statement that we have filed with the SEC to register the shares underlying the Public Warrants. Theexercise price of the Warrants is currently $11.50 per share. To the extent the Public Warrants are exercised, additional shares of Common Stock will be issued, which will result in dilution to theholders of ourCommon Stock and increase the number of shares eligible for resale in the public market. Sales, or the potential sales, of substantial numbers of shares in the public market by the SellingSecurityholders upon termination of applicable contractual lock-up agreements or by holders of the Public Warrants, could increase the volatility of the market price of our Common Stock or adverselyaffect the market price of our Common Stock.

        Asof June 3, 2020, after the completion of the Business Combination, we had outstanding approximately 360.9 million shares of our Common Stock, and Warrants to purchaseapproximately 23.9 millon shares of our Common Stock. In addition, we intend to register for sale shares of our Common Stock issuable under our equity compensation plans, including20.0 million shares available for future issuance under our 2020 Stock Incentive Plan (the "2020 Plan"), 4.0 million shares available for future issuance under our 2020 Employee Stock PurchasePlan (the "2020 ESPP"), and approximately 39.7 million shares issuable upon the exercise of outstanding options under our 2017 Stock Option Plan. The sale or the availability for sale of a largenumber of shares of our Common Stock in the public market could cause the price of our Common Stock to decline.

We have never paid dividends on our capital stock, and we do not anticipate paying dividends in theforeseeable future.

        We have never paid dividends on any of our capital stock and currently intend to retain any future earnings to fund the growth of our business.Any determination to pay dividends in the future will be at the discretion of our board of directors (the "Board") and will depend on our financial condition,

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operatingresults, capital requirements, general business conditions and other factors that the Board may deem relevant. As a result, capital appreciation, if any, of our Common Stock will be the solesource of gain for the foreseeable future.

Our stock price is volatile, and you may not be able to sell shares of our Common Stock at or above the priceyou paid.

        The trading price of our Common Stock is volatile and could be subject to wide fluctuations in response to various factors, some of which arebeyond our control. These factors include:

•

actual or anticipated fluctuations in operating results;



•

failure to meet or exceed financial estimates and projections of the investment community or that we provide to the public;



•

issuance of new or updated research or reports by securities analysts or changed recommendations for our stock or the transportation industryin general;



•

announcements by us or our competitors of significant acquisitions, strategic partnerships, joint ventures, collaborations or capitalcommitments;



•

operating and share price performance of other companies that investors deem comparable to us;



•

our focus on long-term goals over short-term results;



•

the timing and magnitude of our investments in the growth of our business;



•

actual or anticipated changes in laws and regulations affecting our business;



•

additions or departures of key management or other personnel;



•

disputes or other developments related to our intellectual property or other proprietary rights, including litigation;



•

our ability to market new and enhanced products and technologies on a timely basis;



•

sales of substantial amounts of the Common Stock by the Board, executive officers or significant stockholders or the perception that such salescould occur;



•

changes in our capital structure, including future issuances of securities or the incurrence of debt; and



•

general economic, political and market conditions.

        Inaddition, the stock market in general, and The Nasdaq Stock Market LLC ("Nasdaq") in particular, has experienced extreme price and volume fluctuations that have often beenunrelated or disproportionate to the operating performance of those companies. Broad market and industry factors may seriously affect the market price of our Common Stock, regardless of our actualoperating performance. In addition, in the past, following periods of volatility in the overall market and the market price of a particular company's securities, securities class action litigation hasoften been instituted against these companies. This litigation, if instituted against us, could result in substantial costs and a diversion of our management's attention and resources.

We will incur significant increased expenses and administrative burdens as a public company, which could havean adverse effect on our business, financial condition and results of operations.

        We face increased legal, accounting, administrative and other costs and expenses as a public company that we did not incur as a private company.The Sarbanes-Oxley Act of 2002 (the "Sarbanes-Oxley Act"), including the requirements of Section 404, as well as rules and regulations subsequently

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implementedby the SEC, the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 and the rules and regulations promulgated and to be promulgated thereunder, the Public Company AccountingOversight Board (the "PCAOB") and the securities exchanges, impose additional reporting and other obligations on public companies. Compliance with public company requirements will increase costs andmake certain activities more time-consuming. A number of those requirements require us to carry out activities Legacy Nikola has not done previously. For example, we created new board committees andhave adopted new internal controls and disclosure controls and procedures. In addition, expenses associated with SEC reporting requirements will be incurred. Furthermore, if any issues in complyingwith those requirements are identified (for example, if the auditors identify a material weakness or significant deficiency in the internal control over financial reporting), we could incur additionalcosts rectifying those issues, and the existence of those issues could adversely affect our reputation or investor perceptions of it. In addition, we have obtained director and officer liabilityinsurance. Risks associated with our status as a public company may make it more difficult to attract and retain qualified persons to serve on the Board or as executive officers. The additionalreporting and other obligations imposed by these rules and regulations increase legal and financial compliance costs and the costs of related legal, accounting and administrative activities. Theseincreased costs will require us to divert a significant amount of money that could otherwise be used to expand the businessand achieve strategic objectives. Advocacy efforts by stockholders and third parties may also prompt additional changes in governance and reporting requirements, which could further increase costs.

Our failure to timely and effectively implement controls and procedures required by Section 404(a) ofthe Sarbanes-Oxley Act could have a material adverse effect on our business.

        As a public company, we are required to provide management's attestation on internal controls. The standards required for a public company underSection 404(a) of the Sarbanes-Oxley Act are significantly more stringent than those required of Legacy Nikola as a private company. Management may not be able to effectively and timelyimplement controls and procedures that adequately respond to the increased regulatory compliance and reporting requirements that became applicable after the Business Combination. If we are not able toimplement the additional requirements of Section 404(a) in a timely manner or with adequate compliance, we may not be able to assess whether our internal controls over financial reporting areeffective, which may subject us to adverse regulatory consequences and could harm investor confidence and the market price of our securities.

We qualify as an "emerging growth company" within the meaning of the Securities Act, and if we takesadvantage of certain exemptions from disclosure requirements available to emerging growth companies, it could make our securities less attractive to investors and may make it more difficult to compareour performance to the performance of other public companies.

        We qualify as an "emerging growth company" as defined in Section 2(a)(19) of the Securities Act, as modified by the JOBS Act. As such, weare eligible for and intend to take advantage of certain exemptions from various reporting requirements applicable to other public companies that are not emerging growth companies for as long as wecontinue to be an emerging growth company, including (a) the exemption from the auditor attestation requirements with respect to internal control over financial reporting underSection 404(b) of the Sarbanes-Oxley Act, (b) the exemptions from say-on-pay, say-on-frequency and say-on-golden parachute voting requirements and (c) reduced disclosureobligations regarding executive compensation in our periodic reports and proxy statements. We will remain an emerging growth company until the earliest of (i) the last day of the fiscal year inwhich the market value of Common Stock that are held by non-affiliates exceeds $700.0 million as of June 30 of that fiscal year, (ii) the last day of the fiscal year in which ithas total annual gross revenue of $1.07 billion or more during such fiscal year (as indexed for inflation), (iii) the date on which we have issued more than $1 billion innon-convertible debt in the prior three-year period or (iv) the last day of the fiscal year following the fifth anniversary of the date of the first sale of Common Stock in

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VectoIQ'sinitial public offering of units, consummated on May 15, 2018 (the "IPO"). In addition, Section 107 of the JOBS Act also provides that an emerging growth company can takeadvantage of the exemption from complying with new or revised accounting standards provided in Section 7(a)(2)(B) of the Securities Act as long as we are an emerging growth company. An emerginggrowth company can therefore delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We have elected not to opt out of such extendedtransition period and, therefore, we may not be subject to the same new or revised accounting standards as other public companies that are not emerging growth companies. Investors may find oursecurities less attractive because we will rely on these exemptions, which may result in a less active trading market for the Common Stock and Warrants and the price of such securities may be morevolatile.

The unaudited pro forma financial information included herein is not indicative of what our actual financialposition or results of operations would have been.

        The unaudited pro forma financial information included herein is presented for illustrative purposes only and is not necessarily indicative ofwhat our actual financial position or results of operations would have been had the Business Combination been completed on the dates indicated.

Our management has limited experience in operating a public company.

        Our executive officers have limited experience in the management of a publicly traded company. Our management team may not successfully oreffectively manage our transition to a public company that will be subject to significant regulatory oversight and reporting obligations under federal securities laws. Their limited experience indealing with the increasingly complex laws pertaining to public companies could be a significant disadvantage in that it is likely that an increasing amount of their time may be devoted to theseactivities which will result in less time being devoted to the management and growth of the Company. We may not have adequate personnel with the appropriate level of knowledge, experience, andtraining in the accounting policies, practices or internal controls over financial reporting required of public companies in the United States. The development and implementation of the standards andcontrols necessary for the Company to achieve the level of accounting standards required of a public company in the United States may require costs greater than expected. It is possible that we willbe required to expand our employee base and hire additional employees to support our operations as a public company which will increase our operating costs in future periods.

We may amend the terms of the Warrants in a manner that may be adverse to holders with the approval by theholders of at least 65% of the then outstanding Public Warrants.

        The Warrants were issued in registered form under the Warrant Agreement between Continental Stock Transfer & Trust Company, as warrantagent, and us. The Warrant Agreement provides that the terms of the Warrants may be amended without the consent of any holder to cure any ambiguity or correct any defective provision but requires theapproval by the holders of at least 65% of the then outstanding Public Warrants to make any change that adversely affects the interests of the registered holders. Accordingly, we may amend the termsof the Warrants in a manner adverse to a holder if holders of at least 65% of the then outstanding Public Warrants approve of such amendment. Although our ability to amend the terms of the Warrantswith the consent of at least 65% of the then outstanding Public Warrants is unlimited, examples of such amendments could be amendments to, among other things, increase the exercise price of theWarrants, convert the Warrants into stock or cash, shorten the exercise period or decrease the number of warrant shares issuable upon exercise of a Warrant.

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We may redeem unexpired Warrants prior to their exercise at a time that is disadvantageous to you, therebymaking those Warrants worthless.

        The Private Warrants will be not redeemable by us so long as they are held by their initial purchasers or their permitted transferees. However,if the Private Warrants are sold to you and you are not a permitted transferee under the terms of the Private Warrants, we will have the ability to redeem outstanding Warrants at any time after theybecome exercisable and prior to their expiration, at a price of $0.01 per warrant, provided that the last reported sales price of Common Stock equals or exceeds $18.00 per share for any 20 tradingdays within a 30-trading day period ending on the third trading day prior to the date we give notice of redemption. If and when the Warrants become redeemable by us, we may exercise our redemptionright even if we are unable to register or qualify the underlying securities for sale under all applicable state securities laws. Redemption of the outstanding Warrants could force you (i) toexercise your Warrants and pay the exercise price therefor at a time when it may be disadvantageous for you to do so, (ii) to sell your Warrants at the then-current market price when you mightotherwise wish to hold your Warrants or (iii) to accept the nominal redemption price which, at the time the outstanding Warrants are called for redemption, is likely to be substantially lessthan the market value of your Warrants.

Our Certificate of Incorporation provides, subject to limited exceptions, that the Court of Chancery of theState of Delaware will be the sole and exclusive forum for certain stockholder litigation matters, which could limit our stockholders' ability to obtain a favorable judicial forum for disputes with usor our directors, officers, employees or stockholders.

        Our Certificate of Incorporation requires, to the fullest extent permitted by law, that derivative actions brought in our name, actions againstdirectors, officers and employees for breach of fiduciary duty and other similar actions may be brought in the Court of Chancery in the State of Delaware or, if that court lacks subject matterjurisdiction, another federal or state court situated in the State of Delaware. Any person or entity purchasing or otherwise acquiring any interest in shares of our capital stock shall be deemed tohave notice of and consented to the forum provisions in our Certificate of Incorporation. In addition, our Certificate of Incorporation and Bylaws will provide that the federal district courts of theUnited States shall be the exclusive forum for the resolution of any complaint asserting a cause of action under the Securities Act and the Exchange Act.

        InMarch 2020, the Delaware Supreme Court issued a decision in Salzburg et al. v. Sciabacucchi, which found that an exclusive forumprovision providing for claims under the Securities Act to be brought in federals court is facially valid under Delaware law. It is unclear whether this decision will be appealed, or what the finaloutcome of this case will be. We intend to enforce this provision, but we do not know whether courts in other jurisdictions will agree with this decision or enforce it.

        Thischoice of forum provision may limit a stockholder's ability to bring a claim in a judicial forum that it finds favorable for disputes with us or any of our directors, officers,other employees or stockholders, which may discourage lawsuits with respect to such claims. Alternatively, if a court were to find the choice of forum provision contained in our Certificate ofIncorporation to be inapplicable or unenforceable in an action, we may incur additional costs associated with resolving such action in other jurisdictions, which could harm our business, operatingresults and financial condition.

If securities or industry analysts issue an adverse opinion regarding our stock or do not publish research orreports about our company, our stock price and trading volume could decline.

        The trading market for our Common Stock will depend in part on the research and reports that equity research analysts publish about us and ourbusiness. We do not control these analysts or the content and opinions included in their reports. Securities analysts may elect not to provide research coverage of our company and such lack ofresearch coverage may adversely affect the market price of our Common Stock. The price of our Common Stock could also decline if one or more equity research analysts downgrade our Common Stock, changetheir price targets, issue other unfavorable commentary or cease publishing reports about us or our business. If one or more equity research analysts cease coverage of our company, we could losevisibility in the market, which in turn could cause our stock price to decline.

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USE OF PROCEEDS

        All of the Common Stock offered by the Selling Securityholders pursuant to this prospectus will be sold by the Selling Securityholders for theirrespective accounts. We will not receive any of the proceeds from these sales.

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DETERMINATION OF OFFERING PRICE

        We cannot currently determine the price or prices at which shares of our Common Stock may be sold by the Selling Securityholders under thisprospectus.

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MARKET INFORMATION FOR COMMON STOCK AND DIVIDEND POLICY

Market Information

        Our Common Stock and Public Warrants are currently listed on the Nasdaq Global Select Market under the symbols "NKLA" and "NKLAW," respectively.Prior to the consummation of the Business Combination, our Common Stock and our Public Warrants were listed on the Nasdaq Capital Market under the symbols "VTIQ" and "VTIQW," respectively. As ofJune 3, 2020 following the completion of the Business Combination, there were 81 holders of record of our Common Stock and 9 holders of record of our Warrants. We currently do not intend tolist the Private Warrants on any stock exchange or stock market.

Dividend Policy

        We have not paid any cash dividends on the Common Stock to date. We may retain future earnings, if any, for future operations, expansion anddebt repayment and has no current plans to pay cash dividends for the foreseeable future. Any decision to declare and pay dividends in the future will be made at the discretion of the Board and willdepend on, among other things, our results of operations, financial condition, cash requirements, contractual restrictions and other factors that the Board may deem relevant. In addition, our abilityto pay dividends may be limited by covenants of any existing and future outstanding indebtedness we or our subsidiaries incur. We do not anticipate declaring any cash dividends to holders of theCommon Stock in the foreseeable future.

Securities Authorized for Issuance under Equity Compensation Plans

        As of March 31, 2020, we did not have any securities authorized for issuance under equity compensation plans. In connection with theBusiness Combination, our stockholders approved the 2020 Plan and the 2020 ESPP.

        Weintend to file one or more registration statements on Form S-8 under the Securities Act to register the shares of Common Stock issued or issuable under the 2020 Plan, the 2020ESPP and the assumed Legacy Nikola Options. Any such Form S-8 registration statement will become effective automatically upon filing. We expect that the initial registration statement onForm S-8 will cover shares of Common Stock underlying the 2020 Plan, the 2020 ESPP and the assumed Legacy Nikola Options. Once these shares are registered, they can be sold in the public marketupon issuance, subject to applicable restrictions.

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SELECTED FINANCIAL INFORMATION

        The following selected financial information and other data set forth below should be read in conjunction with the section entitled"Management's Discussion and Analysis of Financial Condition and Results of Operations" and our historical consolidated financial statements and therelated notes thereto contained elsewhere in this prospectus.

        Theselected financial information and other data presented below for the years ended December 31, 2017, 2018 and 2019, and the selected consolidated balance sheet and other dataas of December 31, 2018 and 2019 have been derived from our audited consolidated financial statements included in this prospectus. The selected financial information and other data presentedbelow for the three months ended March 31, 2020 and 2019, and as of March 31, 2020 have been derived from the Company's unaudited financial statements included in this prospectus.

 

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UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION

        The following unaudited pro forma condensed combined financial statements of VectoIQ present the combination of the financial information ofVectoIQ and Legacy Nikola adjusted to give effect to the Business Combination and related transactions. The following unaudited pro forma condensed combined financial information has been prepared inaccordance with Article 11 of Regulation S-X.

        Theunaudited pro forma condensed combined balance sheet as of March 31, 2020 combines the historical balance sheet of VectoIQ and the historical balance sheet of Legacy Nikola ona pro forma basis as if the Business Combination and related transactions, summarized below, had been consummated on March 31, 2020. The unaudited pro forma condensed combined statements ofoperations for the three months ended March 31, 2020 and the year ended December 31, 2019 combine the historical statements of operations of VectoIQ and Legacy Nikola for such periods ona pro forma basis as if the Business Combination and related transactions, summarized below, had been consummated on January 1, 2019, the beginning of the earliest periodpresented:

•

the merger of Legacy Nikola with and into Merger Sub, a wholly owned subsidiary of VectoIQ, with Legacy Nikola surviving the merger as awholly-owned subsidiary of VectoIQ;



•

the issuance and sale of 52,500,000 shares of Common Stock for a purchase price of $10.00 per share and an aggregate purchase price of$525.0 million in a private placement pursuant to the Subscription Agreements (the "PIPE");



•

the issuance of 2,699,784 shares of Legacy Nikola's Series D redeemable convertible preferred stock in exchange for $50.0 millionin cash pursuant to the amended Series D preferred stock purchase agreement and 3,887,657 shares of Legacy Nikola's Series D redeemable convertible preferred stock in exchange for$72.0 million in-kind services provided by CNHI/Iveco under the Master Industrial Agreement (the "CNHI Services Agreement");



•

the repurchase of 1,499,700 shares of Legacy Nikola's Series B redeemable convertible preferred stock at the price of $16.67 per sharefor an aggregate purchase price of $25.0 million pursuant to a Series B preferred stock repurchase agreement (the "Repurchase Agreement") with Nimbus Holdings LLC ("Nimbus");



•

the exercise of 935,345 Legacy Nikola stock options; and



•

the redemption of 7,000,000 shares of Common Stock from M&M Residual, LLC at a purchase price of $10.00 per share.

        Thehistorical financial statements have been adjusted in the unaudited pro forma condensed combined financial statements to give pro forma effect to events that are: (i) directlyattributable to the Business Combination; (ii) factually supportable; and (iii) with respect to the statement of operations, expected to have a continuing impact on VectoIQ's resultsfollowing the completion of the Business Combination.

        Theunaudited pro forma condensed combined financial statements have been developed from and should be read in conjunction with:

•

the accompanying notes to the unaudited pro forma condensed combined financial statements;



•

the (i) historical condensed unaudited financial statements of VectoIQ as of and for the three months ended March 31, 2020 and(ii) historical audited financial statements of VectoIQ as of and for the year ended December 31, 2019 and the related notes, each of which is incorporated by reference;



•

the (i) historical condensed unaudited financial statements of Legacy Nikola as of and for the three months ended March 31, 2020,which is attached as an exhibit to this filing and

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incorporatedby reference and (ii) historical audited financial statements of Legacy Nikola as of and for the year ended December 31, 2019 and the related notes, which is incorporated byreference; and

•

other information relating to VectoIQ and Legacy Nikola contained in this prospectus, including the Business Combination Agreement.

        Pursuantto VectoIQ's amended and restated certificate of incorporation, the holders of shares of Common Stock prior to the completion of the Business Combination (the "PublicStockholders") were offered the opportunity to redeem, upon the Closing, shares of Common Stock then held by them for cash equal to their pro rata share of the aggregate amount on deposit (as of twobusiness days prior to the Closing) in the Trust Account (as defined in the section entitled "Description of Our Securities"). The unaudited condensedcombined pro forma financial statements reflect actual redemption of 2,702 shares of Common Stock at $10.37 per share.

        Notwithstandingthe legal form of the Business Combination pursuant to the Business Combination Agreement, the Business Combination is accounted for as a reverse recapitalization inaccordance withGAAP. Under this method of accounting, VectoIQ is treated as the acquired company and Legacy Nikola is treated as the acquirer for financial statement reporting purposes. Legacy Nikola has beendetermined to be the accounting acquirer based on evaluation of the following facts and circumstances:

•

Legacy Nikola's existing shareholders have the greatest voting interest in the combined entity with over 77% voting interest;



•

the largest minority voting shareholder of the combined entity is an existing shareholder of Legacy Nikola;



•

Legacy Nikola's directors represent eight of the nine board seats for the combined company's board of directors;



•

Legacy Nikola's existing shareholders have the ability to control decisions regarding election and removal of directors and officers of thecombined entity's executive board of directors; and



•

Legacy Nikola's senior management is the senior management of the combined company.

        Assumptionsand estimates underlying the unaudited pro forma adjustments set forth in the unaudited pro forma condensed combined financial statements are described in the accompanyingnotes. The unaudited pro forma condensed combined financial statements have been presented for illustrative purposes only and are not necessarily indicative of the operating results and financialposition that would have been achieved had the Business Combination occurred on the dates indicated. Further, the unaudited pro forma condensed combined financial statements do not purport to projectthe future operating results or financial position of VectoIQ following the completion of the Business Combination. The unaudited pro forma adjustments represent management's estimates based oninformation available as of the date of these unaudited pro forma condensed combined financialstatements and are subject to change as additional information becomes available and analyses are performed.

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UNAUDITED PRO FORMA CONDENSED COMBINED BALANCE SHEET
AS OF MARCH 31, 2020
(in thousands)

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UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS
FOR THE THREE MONTHS ENDED MARCH 31, 2020
(in thousands, except share and per share data)

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UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 2019
(in thousands, except share and per share data)

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Notes to Unaudited Pro Forma Condensed Combined Financial Statements

1. Basis of Presentation

        TheBusiness Combination is accounted for as a reverse recapitalization, with no goodwill or other intangible assets recorded, in accordance with GAAP. Under thismethod of accounting, VectoIQ is treated as the acquired company for financial reporting purposes. Accordingly, for accounting purposes, the Business Combination is treated as the equivalent of LegacyNikolaissuing stock for the net assets of VectoIQ, accompanied by a recapitalization. The net assets of VectoIQ are stated at historical cost, with no goodwill or other intangible assets recorded.

        Theunaudited pro forma condensed combined balance sheet as of March 31, 2020 gives pro forma effect to the Business Combination as if it had been consummated on March 31,2020. The unaudited pro forma condensed combined statement of operations for the year ended December 31, 2019 and for the three months ended March 31, 2020 give pro forma effect to theBusiness Combination as if it had been consummated on January 1, 2019.

        Theunaudited pro forma condensed combined balance sheet as of March 31, 2020 has been prepared using, and should be read in conjunction with, thefollowing:

•

VectoIQ's unaudited balance sheet as of March 31, 2020 and the related notes, which is incorporated by reference; and



•

Legacy Nikola's unaudited balance sheet as of March 31, 2020 and the related notes, which is attached as an exhibit to this filing andincorporated by reference.

        Theunaudited pro forma condensed combined statement of operations for the three months ended March 31, 2020 has been prepared using, and should be read in conjunction with, thefollowing:

•

VectoIQ's unaudited statement of operations for the three months ended March 31, 2020 and the related notes, which is incorporated byreference; and



•

Legacy Nikola's unaudited statement of operations for the three months ended March 31, 2020 and the related notes, which is attached asan exhibit to this filing and incorporated by reference.

        Theunaudited pro forma condensed combined statement of operations for the year ended December 31, 2019 has been prepared using, and should be read in conjunction with, thefollowing:

•

VectoIQ's audited statement of operations for the year ended December 31, 2019 and the related notes, which is incorporated byreference; and



•

Legacy Nikola's audited statement of operations for the year ended December 31, 2019 and the related notes, which is incorporated byreference.

        Managementhas made significant estimates and assumptions in its determination of the pro forma adjustments. As the unaudited pro forma condensed combined financial information has beenprepared based on these preliminary estimates, the final amounts recorded may differ materially from the information presented.

        Theunaudited pro forma condensed combined financial information does not give effect to any anticipated synergies, operating efficiencies, tax savings or cost savings that may beassociated with the Business Combination. The pro forma adjustments reflecting the consummation of the Business Combination are based on certain currently available information and certain assumptionsand methodologies that management believes are reasonable under the circumstances. The unaudited condensed pro forma adjustments, which are described in the accompanying notes, may be revised asadditional information becomes available and is evaluated. Therefore, it is likely that the actual adjustments will differ from the pro forma adjustments and it is possible the difference may be

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material.Management believes that its assumptions and methodologies provide a reasonable basis for presenting all of the significant effects of the Business Combination based on information availableto management at the time and that the pro forma adjustments give appropriate effect to those assumptions and are properly applied in the unaudited pro forma condensed combined financial information.

        Theunaudited pro forma condensed combined financial information is not necessarily indicative of what the actual results of operations and financial position would have been had theBusiness Combination taken place on the dates indicated, nor are they indicative of the future consolidated results of operations or financial position of the post-combination company. They should beread in conjunction with the historical financial statements and notes thereto of VectoIQ and Legacy Nikola.

2. Adjustments to Unaudited Pro Forma Condensed Combined Financial Information

        Theunaudited pro forma condensed combined financial information has been prepared to illustrate the effect of the Business Combination and has been prepared forinformational purposes only. The historical financial statements have been adjusted in the unaudited pro forma condensed combined financial information to give pro forma effect to events that are(1) directly attributable to the Business Combination, (2) factually supportable, and (3) with respect to the statements of operations, expected to have a continuing impact on theresults of the post-combination company. VectoIQ and Legacy Nikola have not had any historical relationship prior to the Business Combination. Accordingly, no pro forma adjustments were required toeliminate activities between the companies.

Adjustments to Unaudited Pro Forma Condensed Combined Balance Sheet

        The adjustments included in the unaudited pro forma condensed combined balance sheet as of March 31, 2020 are asfollows:

(A)

Representspro forma adjustments to the cash balance to reflect the following:

(B)

Reflectsthe issuance of an additional 2,699,784 and 3,887,657 Series D redeemable convertible preferred stock in exchange for $50.0 million and$72.0 million in-kind services provided by CNHI and Iveco pursuant to the amended Series D preferred stock purchase agreement, including the settlement of the $1.3 million forwardcontract liability.

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(C)

Reflectsthe repurchase of 1,499,700 Series B redeemable convertible preferred stock at the price of $16.67 per share for an aggregate purchase price of$25.0 million pursuant to the Series B preferred stock repurchase agreement.



(D)

Reflectsthe proceeds of approximately $1.8 million for the exercise of 935,345 Legacy Nikola stock options.



(E)

Representstransaction costs of approximately $6.6 million incurred by Legacy Nikola in consummating the Business Combination. Of the amount, approximately$0.4 million in cash, $4.7 million in prepaid expenses and other current assets, $3.9 million in accrued expenses and other current liabilities, and $0.4 million inaccounts payable related to transaction costs were previously incurred and recorded as of March 31, 2020. These costs are not included in the unaudited pro forma condensed combined statement ofoperations as they are deemed to not have a continuing impact on the results of the post-combination company.



(F)

Representstransaction costs and underwriting costs of approximately $45.7 million incurred by VectoIQ in consummating the Business Combination. Of theamount, approximately $0.4 million was previously incurred as of March 31, 2020. These costs are not included in the unaudited pro forma condensed combined statement of operations asthey are deemed to not have a continuing impact on the results of the post-combination company.



(G)

Reflectsthe reclassification of $238.4 million of cash and investments held in the Trust Account that becomes available following the Business Combination.



(H)

Reflectsthe net proceeds of $525.0 million from the issuance and sale of 52,500,000 shares of Common Stock at $10.00 per share in a private placementpursuant to the Subscription Agreements.



(I)

Reflectsshare redemption of 7,000,000 shares of Common Stock from M&M Residual, LLC at a purchase price of $10.00 per share.



(J)

Representspro forma adjustments to accrued expenses and other current liabilities to reflect the following:

(K)

Reflectsthe settlement of accrued expenses pursuant to the Administrative Support Agreement with VectoIQ's Sponsor, which terminated upon consummation of theBusiness Combination.



(L)

Reflectsthe settlement of VectoIQ's related party loans upon consummation of the merger.



(M)

Reflectsthe conversion of Legacy Nikola preferred stock into Legacy Nikola common stock.



(N)

Reflectsthe reclassification of $233.2 million of Common Stock subject to possible redemption to permanent equity.

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(O)

Representspro forma adjustments to Common Stock balance to reflect the following:

(P)

Representsrecapitalization of Legacy Nikola common stock to Common Stock.



(Q)

Representspro forma adjustments to Legacy Nikola common stock balance to reflect the following:

(R)

Representspro forma adjustments to additional paid-in capital balance to reflect the following:

(S)

Representsthe amount of compensation cost related to the acceleration of the vesting for certain existing stock options granted.

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(T)

Representsthe stock compensation expense that will be recognized for the non-employee director compensation program. These costs are not included in the unauditedpro forma condensed combined statement of operations as the RSUs granted to non-employee directors vest in full on the first anniversary of the grant date. As such, they are deemed to not have acontinuing impact on the results of the post-combination company.



(U)

Reflectsthe settlement of stock options pursuant to Legacy Nikola's Founder Stock Option Plan, effective as of December 31, 2018 (the "Founder Stock OptionPlan") upon consummation of the Business Combination.



(V)

Representspro forma adjustments to accumulated deficit balance to reflect the following:

(W)

Representsactual redemption of 2,702 shares of Common Stock for approximately $0.03 million allocated to common stock and additional paid-in capital usingpar value $0.0001 per share and at a redemption price of $10.37 per share. Legacy Nikola common stock not redeemed were rolled over into the combined company's Common Stock.

Adjustments to Unaudited Pro Forma Condensed Combined Statements of Operations

        The pro forma adjustments included in the unaudited pro forma condensed combined statements of operations for the year ended December 31,2019 and the three months ended March 31, 2020 are as follows:

(AA)

Representspro forma adjustment to selling, general, and administrative expenses to reflect the following:

(BB)

Effectiveas of the Closing Date, the Company entered into individual amended and restatement employment agreements with certain executive officers. Subject toBoard approval, the executive officers are eligible to receive time-vested stock awards consisting of RSUs for shares of Common Stock having a value on the date of grant of not less than a fixedamount based on the assumed stock value of $10.00 per share, subject to continued employment during a three-year cliff vesting schedule. A sensitivity analysis was performed to quantify the impact ofa hypothetical increase of 10% on the potential grant date stock value compared to the assumed stock value of $10.00. A 10% increase in stock value

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wouldlead to the recognition of an additional $0.2 million and $0.7 million in stock-based compensation expense for the three months ended March 31, 2020, and the year endedDecember 31, 2019, respectively.

(CC)

Representspro forma adjustment to eliminate historical expenses related to VectoIQ's office space and general administrative services, which terminated uponconsummation of the Merger.



(DD)

Representspro forma adjustment to eliminate investment income related to the investment held in the Trust Account.



(EE)

Reflectsthe elimination of the loss on the forward contract liability. The Company settled the liability in April 2020 with the issuance of Series Dredeemable convertible preferred stock, which ceased to exist upon the conversion into Common Stock.



(FF)

Reflectsthe elimination of the loss on Series A redeemable convertible preferred stock warrant liability. As of December 31, 2019, all of thewarrants were exercised into Series A redeemable convertible preferred stock, which ceased to exist upon the conversion into Common Stock.



(GG)

Reflectsincome tax effect of pro forma adjustments using the estimated statutory tax rate of 21%.



(HH)

Reflectsthe elimination of the premium paid on repurchase of redeemable convertible preferred stock, which ceased to exist upon the conversion into Common Stock.

3. Loss per Share

        Representsthe net loss per share calculated using the historical weighted average shares outstanding, and the issuance of additional shares in connection with theBusiness Combination, assuming the shares were outstanding since January 1, 2019. As the Business Combination is being reflected as if it had occurred at the beginning of the periods presented,the calculation of weighted average shares outstanding for basic and diluted net loss per share assumes that the shares issuable relating to the Business Combination have been outstanding for theentire periods presented.

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MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

        The following discussion and analysis provides information which Nikola's management believes is relevant to anassessment and understanding of Nikola's consolidated results of operations and financial condition. The discussion should be read together with "Selected Financial Information" and the consolidatedfinancial statements and related notes that are included elsewhere in this prospectus. The discussion and analysis should also be read together with our pro forma financial information for the threemonths ended March 31, 2020 and the year ended December 31, 2019. See the section entitled "Unaudited Pro Forma Condensed Combined Financial Information." This discussion may containforward-looking statements based upon current expectations that involve risks and uncertainties. Our actual results may differ materially from those anticipated in these forward-looking statements asa result of various factors, including those set forth under "Risk Factors" or in other parts of this prospectus. Unless the context otherwise requires, references in this "Management's Discussion andAnalysis of Financial Condition and Results of Operations" to "we", "us", "our", and the "Company" are intended to mean the business and operations of Nikola and its consolidatedsubsidiaries.

Overview

        We are a vertically integrated zero-emissions transportation systems provider that designs and manufactures state-of-the-art battery-electricand hydrogen fuel cell electric vehicles, electric vehicle drivetrains, energy storage systems, and hydrogen fueling stations. To date, we have been primarily focused on delivering zero-emissionclass 8 semi-trucks to the commercial transportation sector in the U.S. and in Europe. Our core product offering includes battery-electric and hydrogen fuel cell electric trucks and hydrogenfuel.

        Weoperate in three business units: Truck, Energy and Powersports. The Truck business unit is developing and commercializing battery-electric vehicle ("BEV") and hydrogen fuel cellelectric vehicle ("FCEV") class 8 trucks that provide environmentally friendly, cost-effective solutions to the short haul and long-haul trucking sector. The Energy business unit is developingand constructing a network of hydrogen fueling stations to meet hydrogen fuel demand for FCEV customers. The Powersports business unit is developing electric vehicle solutions for military and outdoorrecreational applications.

        In2019, Legacy Nikola partnered with Iveco S.p.A ("Iveco"), a subsidiary of CNH Industrial N.V. ("CNHI"), a leading European industrial vehicle manufacturing company. Together,we and Iveco are jointly developing cab over BEV and FCEV trucks for sale in the European market, which will be manufactured through a 50/50 owned joint venture in Europe. In April 2020, Legacy Nikolaand Iveco entered into a series of agreements which established the joint venture, Nikola Iveco Europe B.V. The joint venture with Iveco provides us with the manufacturing infrastructure tobuild BEV trucks for the North American market prior to the completion of our planned greenfield manufacturing facility in Coolidge, Arizona. The operations of the joint venture are expected tocommence in the third quarter of fiscal 2020.

        Ourplan is to begin construction on our greenfield manufacturing facility in late 2020, and Iveco will contribute technical engineering and production support. Phase 1 of thegreenfield manufacturing facility will be completed by the end of 2021, and we expect to start BEV production at the facility in 2022 and FCEV production in 2023.

        Todate, Legacy Nikola has financed its operations primarily through private placements of redeemable convertible preferred stock. From the date of incorporation through March 31,2020, Legacy Nikola has raised aggregate gross proceeds of approximately $435.1 million from the issuance of redeemable convertible preferred stock, both for cash and in-kind contributions ofservices and intellectual property. Legacy Nikola incurred a net loss of $33.2 million and used $22.0 million in cash to fund its operations during the three months endedMarch 31, 2020.

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

•

construct manufacturing facilities and purchases related equipment;



•

commercialize our heavy-duty trucks and other products;



•

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;



•

obtain, maintain, expand, and protects our intellectual property portfolio; and



•

operate as a public company.

Comparability of Financial Information

        Our results of operations and statements of assets and liabilities may not be comparable between periods as a result of the BusinessCombination.

Business Combination and Public Company Costs

        We were originally known as VectoIQ Acquisition Corp. On June 3, 2020, VectoIQ consummated the Merger of its wholly-owned subsidiaryMerger Sub, with and into Legacy Nikola, pursuant to the Business Combination Agreement, among VectoIQ, Legacy Nikola and Merger Sub. In connection with the Closing, VectoIQ changed its name to NikolaCorporation.

        Followingthe Closing, Legacy Nikola was deemed the accounting predecessor of the Merger and will be the successor registrant for SEC purposes, meaning that Legacy Nikola's financialstatements for previous periods will be disclosed in our future periodic reports filed with the SEC.

        TheMerger is accounted for as a reverse recapitalization. Under this method of accounting, VectoIQ will be treated as the acquired company for financial statement reporting purposes.The most significant change in the successor's future reported financial position and results are an increase in cash and cash equivalents (as compared to Legacy Nikola's consolidated balance sheet atMarch 31,2020) as a result of the Business Combination, the PIPE transaction and net proceeds from Series D convertible preferred stock, offset by payments for operations. Total non-recurringtransaction costs are approximately $52.3 million, of which Legacy Nikola incurred approximately $6.6 million. In addition, stock options issued by Legacy Nikola's Chief ExecutiveOfficer to certain employees were accelerated upon the Closing, which is a non-recurring expense of approximately $3.8 million for the three months ended June 30, 2020. The underlyingLegacy Nikola common stock of these stock options are owned by Legacy Nikola's Chief Executive Officer and are considered to be issued by us for accounting purposes. In addition, certain stock optionsvesting periods were accelerated due to the Merger and Legacy Nikola recorded an additional $8.1 million of expense during the three months ended June 30, 2020. Our unaudited pro formacondensed combined financial information as of and for the three months ended March 31, 2020 is contained elsewhere in this prospectus.

        Asa consequence of the Merger, we are a Nasdaq-listed company, which will require us to hire additional personnel and implement procedures and processes to address public companyregulatory requirements and customary practices. We expect to incur additional annual expenses as a public company for, among other things, directors' and officers' liability insurance, director feesand additional

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internaland external accounting and legal and administrative resources, including increased audit and legal fees.

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 risksand challenges, including those set forth in the section entitled "Risk Factors."

Commercial Launch of Nikola heavy duty trucks and other products

        We expect to derive revenue from our BEV trucks in 2021 and FCEV trucks in 2023. Prior to commercialization, we must complete modification orconstruction of requiredmanufacturing facilities, purchase and integrate related equipment and software, and achieve several research and development milestones. As a result, we will require substantial additional capital todevelop our products and services and fund operations for the foreseeable future. Until we can generate sufficient revenue from product sales and hydrogen FCEV leases, we expect to finance ouroperations through a combination of existing cash on hand as a result of the Business Combination and PIPE, secondary public offerings, debt financings, collaborations, and licensing arrangements. Theamount and timing of our future funding requirements will depend on many factors, including the pace and results of our development efforts. Any delays in the successful completion of ourmanufacturing facility will impact our ability to generate revenue.

Customer Demand

        While not yet commercially available, we have received significant interest from potential customers. Going forward, we expect the size of ourcommitted backlog to be an important indicator of our future performance.

Basis of Presentation

        Currently, we conduct business through one operating segment. All long-lived assets are maintained in, and all losses are attributable to, theUnited States of America. See Note 2 in the accompanying audited consolidated financial statements for more information about our operating segment.

Components of Results of Operations

Revenues

        To date, we have primarily generated revenues from services related to solar installation projects that are completed in one year or less. Solarinstallation projects are expected to be discontinued.

        Followingthe anticipated introduction of our products to the market, we expect the significant majority of our revenue to be derived from direct sales of BEV trucks starting in 2021 andfrom the bundled leases of FCEV trucks beginning in 2023. Our bundled lease offering is inclusive of the cost of the truck, hydrogen fuel and regularly-scheduled maintenance. We expect the bundledleases to qualify for the "sales-type lease" accounting under GAAP, with the sale of the truck recognized upon the transfer of the title, and hydrogen fuel and maintenance revenues recognized overtime as they are being provided to the customer.

Cost of Revenues

        To date, our cost of revenues has included materials, labor, and other direct costs related to solar installation projects.

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        Oncewe have reached commercial production, cost of revenues will include direct parts, material and labor costs, manufacturing overhead, including amortized tooling costs anddepreciation of our greenfield manufacturing facility, depreciation of our hydrogen fueling stations, cost of hydrogen production, shipping and logistics costs and reserves for estimated warrantyexpenses.

Research and Development Expense

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

•

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



•

Expenses related to materials, supplies and third-party services;



•

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



•

Depreciation for prototyping equipment and research and development facilities.

        Duringthe three months ended March 31, 2020 and fiscal year 2019, our research and development expenses were primarily incurred in the development of the BEV and FCEV trucks.

        Asa part of its in-kind investment, Iveco is providing us with $100.0 million in advisory services (based on pre-negotiated hourly rates), including project coordination,drawings, documentation support, engineering support, vehicle integration, and product validation support. Those services are expected to be consumed primarily in 2020 and 2021 and will be recorded asresearch and development expense until we reach commercial production.

        Weexpect our research and development costs to increase for the foreseeable future as we continue to invest in research and develop activities to achieve our technology and productroadmap goals.

Selling, General, and Administrative Expense

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

        Weexpect 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 asa public company, including compliance with the rules and regulations of the SEC, legal, audit, additional insurance expenses, investor relations activities, and other administrative and professionalservices.

Interest Income (Expense), net

        Interest income (expense) consists primarily of interest received or earned on our cash and cash equivalents balances. Interest expense consistsof interest paid on our equipment term loan and financing lease.

Gain (loss) on Series A Redeemable Convertible Preferred Stock Warrant Liability

        The gain (loss) on Series A redeemable convertible preferred stock warrant liability includes gains and losses from the remeasurement ofour redeemable convertible preferred stock warrant liability. As of December 31, 2019, all of our outstanding redeemable convertible preferred stock warrants were

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exercised,therefore, going forward, there will not be any impact from the remeasurement of redeemable convertible preferred stock warrants.

Loss on Forward Contract Liability

        The loss on forward contract liability includes losses from the remeasurement of Legacy Nikola's Series D redeemable convertiblepreferred share forward contract liability. In April 2020, Legacy Nikola fulfilled the forward contract liability and, therefore, subsequent to June 30, 2020, there will not be any impact fromthe remeasurement of the forward contract liability.

Other Income, net

        Other income consists primarily of other miscellaneous non-operating items, such as government grants, subsidies, and merchandising.

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 allowablecredits, 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 U.S. andstate deferred tax assets. Cash paid for income taxes, net of refunds during the three months ended March 31, 2020 and during the years ended December 31, 2019, 2018, and 2017 was notmaterial.

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Results of Operations

Comparison of Three Months Ended March 31, 2020 to Three Months Ended March 31, 2019

        The following table sets forth Legacy Nikola's historical operating results for the periods indicated:

Revenues

        Our total revenue decreased by $66 thousand or 53.2% from $124 thousand during the three months ended March 31, 2019 to$58 thousand during the three months ended March 31, 2020. The decrease in revenue was related to a decrease in solar installation services.

Cost of Revenues

        Our cost of revenues decreased by $19 thousand or 30.6% from $62 thousand during the three months ended March 31, 2019 to$43 thousand during the three months ended March 31, 2020, due to a decrease in related revenues.

Research and Development

        Our research and development expenses increased by $0.7 million or 2.8% from $23.4 million during the three months endedMarch 31, 2019 to $24.1 million during the three months ended March 31, 2020. This increase was primarily from higher personnel costs driven by increased engineering headcount,and depreciation costs primarily driven by the depreciation of the new

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headquartersfacility. This was primarily offset from lower spend on purchased components due to preparation for Nikola World in 2019.

Selling, General, and Administrative

        Our selling, general, and administrative expenses increased by $1.5 million or 22.7% from $6.5 million during the three monthsended March 31, 2019 to $8.0 million during the three months ended March 31, 2020. The increase was primarily related to higher personnel expenses driven by growth in headcountand higher general corporate expenses, including depreciation of our new headquarters in Phoenix, Arizona. This was partially offset by a decrease in marketing costs from Nikola World in 2019.

Interest Income, net

        Our interest income, net decreased by $0.2 million or 80.5%, from $0.3 million during the three months ended March 31, 2019to $0.1 million during the three months ended March 31, 2020. The decrease is primarily due to increased interest expense from Legacy Nikola's financing lease and a decrease in averagecash and cash equivalents balance, offset by a higher interest rate earned on deposits.

Loss on Forward Contract Liability

        Our loss on Series D redeemable convertible preferred stock forward contract liability represents the recognized loss from a$1.3 million change in fair value as of March 31, 2020.

Other Income, net

        Our other income, net increased by $0.1 million, from $1 thousand during the three months ended March 31, 2019 to$0.1 million during the three months ended March 31, 2020. The increase was primarily related to subcontracting work performed on government contracts.

Income Tax Expense

        Our income tax expense was immaterial for the three months ended March 31, 2020 and 2019. Legacy Nikola has accumulated net operatinglosses at the federal and state level and maintain a full valuation allowance against Legacy Nikola's net deferred taxes.

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Comparison of Fiscal Year Ended December 31, 2019 to Fiscal Year Ended December 31, 2018

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

Revenues

        Our total revenue increased by $0.3 million or 178.6% from $0.2 million in the fiscal year 2018 to $0.5 million in thefiscal year 2019. The increase in revenue was related to an increase in solar installation services.

Cost of Revenues

        Cost of revenues increased by $0.2 million or 442.0% from $0.1 million in the fiscal year 2018 to $0.3 million in thefiscal year 2019. The increase in the cost of revenues was related to an increase in materials used in solar installation projects.

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Research and Development

        Research and development expenses increased by $9.1 million or 15.7% from $58.4 million in the fiscal year 2018 to$67.5 million in the fiscal year 2019. The increase was primarily due to an increase of $13.3 million in personnel and travel expenses, offset by a $4.4 million decrease inoutside development expenses.

        Theincrease in personnel costs and travel expenses was primarily driven by our increased engineering headcount year over year as we continue to advance the development and design of ourvehicles and invest in our in-house engineering capabilities.

        Outsidedevelopment expenses and materials expenses were higher in the fiscal year 2018 to support the development and build of the Nikola Two FCEV trucks, along with the mockup buildsof the Nikola Tre BEV, and other vehicles, which were all debuted at Nikola World in April 2019. Additionally, in the fiscal year 2019, we have been able to manage our outside research and developmentspend by building our internal engineering team and expect to continue to do so going forward.

Selling, General, and Administrative

        Selling, general, and administrative expenses increased by $8.5 million or 69.1% from $12.2 million in the fiscal year 2018 to$20.7 million in the fiscal year 2019, primarily due to a one-time payment of $2.1 million related to consulting services on future manufacturing site selection, and higher marketingexpenses of $2.7 million primarily related to the Nikola World event held in April 2019. The remaining $3.7 million increase is attributed to higher personnel expenses driven by growthin headcount and higher general corporate expenses, including depreciation of our new headquarters in Phoenix, Arizona.

Interest Income, net

        Interest income, net increased by $0.8 million or 112.2%, from $0.7 million in the fiscal year 2018 to $1.5 million in thefiscal year 2019. The increase was primarily due to the substantial portion of cash and cash equivalents on hand being moved to a higher interest-bearing investment account in the second quarter of2019.

(Loss) gain on Series A Redeemable Convertible Preferred Stock Warrant Liability

        The (loss) gain on Series A redeemable convertible preferred stock warrant liability decreased $6.8 million due to a$3.5 million gain recorded in fiscal 2018 on 3.0 million Series A redeemable convertible preferred warrants which expired in March 2018 as opposed to a $3.3 million lossrecorded in fiscal year 2019 on 720 thousand Series A warrants which were exercised in December 2019.

Other Income, net

        Other income, net increased by $1.4 million, from $6 thousand in the fiscal year 2018 to $1.4 million in the fiscal year2019. The increase was primarily related to grants received from the state of Arizona, as well as subcontracting work performed on government contracts.

        Duringfiscal 2019, Legacy Nikola entered into a $3.5 million grant agreement with Arizona Commerce Authority to relocate our headquarters to Arizona, build manufacturing andresearch and development operations, create jobs, and enter into capital investments within the state. We met the first milestone of the agreement in the fourth quarter of 2019 and received theinitial payment of $1.0 million from the state. We will record future payments in other income as they are received.

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Income Tax Expense (Benefit)

        Our income tax expense increased by $2.2 million, from a benefit of $2.0 million in the fiscal year 2018 to an expense of$0.2 million in the fiscal year 2019. The increase in tax expense is primarily related to changes in deferred tax liabilities recorded for our intangible assets and goodwill.

Comparison of Fiscal Year Ended December 31, 2018 to Fiscal Year Ended December 31, 2017

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

Revenues

        Our total revenue decreased by $0.3 million or 64.4%, from $0.5 million in the fiscal year 2017 to $0.2 million in thefiscal year 2018. The decrease in revenue was primarily related to a decrease in solar installation services.

Cost of Revenues

        Cost of revenues decreased by $0.2 million or 83.6%, from $0.3 million in the fiscal year 2017 to $0.1 million in thefiscal year 2018. The decrease in cost of revenues was primarily related to a decrease in materials used in solar installation projects.

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Research and Development

        Research and development expenses increased by $46.8 million or 402.6%, from $11.6 million in fiscal year 2017 to$58.4 million in fiscal year 2018. The increase was primarily due to increases of $37.0 million in outside development costs, $7.1 million in material expenses, and$2.5 million in personnel costs.

        Theincrease in outside development and materials expenses in the fiscal year 2018 was primarily due to the development and build of the Nikola Two FCEV trucks, and other Nikolavehicles, which were debuted at Nikola World in April 2019. The development activities included using third party engineering services to aid in the development of the fuel cell system, powertrain,battery, vehicle controls, and overall vehicle integration.

        Theincrease in personnel costs was primarily driven by increased headcount year over year as we have continued the internal development of our Nikola Two FCEV truck and Nikola Tre BEVtruck, and related components.

Selling, General, and Administrative

        Selling, general, and administrative expenses increased by $6.4 million or 109.2%, from $5.8 million in the fiscal year 2017 to$12.2 million in the fiscal year 2018, primarily driven by an increase of $4.3 million in personnel and travel expenses as a result of higher headcount. The remaining $2.1 millionincrease is attributed to the rise in professional and legal services and occupancy expenses associated with the relocation of our headquarters from Salt Lake City, Utah to Phoenix, Arizona.

Interest Income (Expense), net

        Interest income (expense), net increased by $1.5 million from interest expense, net of $0.8 million in the fiscal year 2017 tointerest income, net of $0.7 million in the fiscal year 2018. The increase was primarily due to an increase in cash and cash equivalents on-hand, associated with Series B andSeries C preferred stock financing.

Gain (Loss) on Series A Redeemable Convertible Preferred Stock Warrant Liability

        The gain (loss) on Series A redeemable convertible preferred stock warrant liability increased $4.5 million from$1.0 million loss in fiscal 2017 which was a result of the change in fair value related our Series A redeemable convertible preferred stock warrant liability to $3.5 million gainin fiscal 2018, primarily due to a $2.8 million gain recorded in fiscal 2018 on 3 million Series A warrants which expired in March 2018.

Income Tax Benefit

        Our income tax benefit increased by $0.4 million or 27.2%, from a benefit of $1.6 million in the fiscal year 2017 to the benefitof $2.0 million in the fiscal year 2018. The increase in tax benefit is primarily related to changes in deferred tax liabilities related to our indefinite-lived intangible and goodwill.

Non-GAAP Financial Measures

        In addition to our results determined in accordance with GAAP, we believe the following non-GAAP measure is useful in evaluating operationalperformance. 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, whentaken collectively, may be helpful to investors in assessing operating performance.

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EBITDA and Adjusted EBITDA

        "EBITDA" is defined as net loss before other non-operating expense or income, income tax expense or benefit, and depreciation and amortization."Adjusted EBITDA" is defined as EBITDA adjusted for stock-based compensation and other special items determined by management. Adjusted EBITDA is intended as a supplemental measure of performance thatis 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 operatingresults 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 thatwhen 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 beconstrued as an inference that our future results will be unaffected by unusual or non-recurring items. Ourcomputation 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.

        Becauseof these limitations, EBITDA and Adjusted EBITDA should not be considered in isolation or as a substitute for performance measures calculated in accordance with GAAP. Wecompensate 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 andAdjusted EBITDA below and not rely on any single financial measure to evaluate our business.

        Thefollowing table reconciles net loss to EBITDA and Adjusted EBITDA for the three months ended March 31, 2020 and 2019:

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        Thefollowing table reconciles net loss to EBITDA and Adjusted EBITDA for the years ended December 31, 2019, 2018 and 2017, respectively:

Liquidity and Capital Resources

        Since inception, Legacy Nikola has financed its operations primarily from the sales of redeemable convertible preferred stock. As ofMarch 31, 2020, Legacy Nikola's principal sources of liquidity were Legacy Nikola's cash and cash equivalents in the amount of $75.5 million, which are primarily invested in money marketfunds.

Short-Term Liquidity Requirements

        As of the date of this prospectus, we have yet to generate any material revenues from our business operations. As of March 31, 2020, ourcurrent assets were $101.2 million consisting primarily of cash and restricted cash of $79.6 million, and our current liabilities were $30.5 million primarily comprised of accruedexpenses, accounts payables and a $4.1 million equipment term note.

        Inconnection with the June 3, 2020 Business Combination and PIPE transactions we raised gross proceeds of $763.2 million, incurring $52.3 million in transactionfees, for net proceeds of $710.9 million. Net proceeds excludes payments for redemptions of M&M Residual, LLC for $70.0 million and repurchase of Nimbus Series Bconvertible redeemable preferred shares for $25.0 million.

        Asof May 31, 2020, we had a cash and cash equivalents balance of $105.1 million. Based on the cash balance as of May 31, 2020 and proceeds from the BusinessCombination and PIPE transactions, we believe this will be sufficient to continue to execute our business strategy over the next twelve to eighteen month period by (i) completing thedevelopment and industrialization of the Nikola Tre BEV truck, (ii) completing phase one construction of the greenfield manufacturing facility, (iii) completing the construction of apilot commercial hydrogen station and (iv) hiring of personnel.

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

•

the costs of building Phase 1 of our greenfield manufacturing facility and equipment;



•

the timing and the costs involved in bringing our vehicles to market, mainly the Nikola Tre BEV truck;

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•

our ability to manage the costs of manufacturing the Nikola Tre BEV trucks;



•

the scope, progress, results, costs, timing and outcomes of our research and development for our fuel cell trucks;



•

the costs of maintaining, expanding and protecting our intellectual property portfolio, including potential litigation costs and liabilities;



•

revenues received from sales of the Nikola Tre BEV trucks in 2021;



•

the costs of additional general and administrative personnel, including accounting and finance, legal and human resources, as a result ofbecoming a public company;



•

our ability to collect revenues; and



•

other risks discussed in the section entitled "Risk Factors."

Long-Term Liquidity Requirements

        The capital raised in the Business Combination will not be sufficient to cover forecasted capital needs and operating expenditures in fiscalyear 2022 through fiscal year 2024. Until we can generate sufficient revenue from BEV truck sales and FCEV leases to cover operating expenses, working capital and capital expenditures, we expect tofund cash needs through a combination of equity and debt financing, including lease securitizations. If we raise funds by issuing equity securities, dilution to stockholders may result. Any equitysecurities issued may also provide for rights, preferences or privileges senior to those of holders of Common Stock. If we raise funds by issuing debt securities, these debt securities would haverights, preferences and privileges senior to those of holders Common Stock. The terms of debt securities or borrowings could impose significant restrictions on our operations. The credit market andfinancial services industry have in the past, and may in the future, experience periods of upheaval that could impact the availability and cost of equity and debt financing.

        Ifadequate funds are not available, we will need to curb our expansion plans or limit our research and development activities, which would have a material adverse impact on our businessprospects and results of operations.

For the Three Months Ended March 31, 2020 and 2019

        The following table provides a summary of cash flow data:

Cash Flows from Operating Activities

        Our cash flows from operating activities are significantly affected by the growth of Legacy Nikola's business primarily related to research anddevelopment and selling, general, and administrative activities. Legacy Nikola's operating cash flows are also affected by Legacy Nikola's working capital needs to support growth in personnel-relatedexpenditures and fluctuations in accounts payable and other current assets and liabilities.

        Ournet cash used in operating activities was $22.0 million for the three months ended March 31, 2020. The most significant component of Legacy Nikola's cash used duringthis period was a net loss of

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$33.2 million,which included non-cash expenses of $6.7 million for in-kind services, $1.4 million related to depreciation and amortization, $1.3 million related to stockbased compensation, and a loss of $1.3 million related to the change in fair value of Legacy Nikola's Series D redeemable convertible preferred stock forward contract liability, and netcash inflows of $0.4 million from changes in operating assets and liabilities.

        Ourcash used in operating activities was $32.2 million for the three months ended March 31, 2019. The largest component of Legacy Nikola's cash used during this period wasa net loss of $30.1 million, which included non-cash charges of $1.2 million related to stock based compensation, loss of $0.6 million related to the change in fair value ofLegacy Nikola's Series A redeemable convertible preferred stock warrant liability, and $0.2 million related to depreciation and amortization expense, and net cash outflows of$4.0 million from changes in operating assets and liabilities primarily driven by a decrease in accounts payable.

Cash Flows from Investing Activities

        We continue to experience negative cash flows from investing activities as we expand our business and builds our infrastructure. Cash flows frominvesting activities primarily relate to capital expenditures to support our growth. Legacy Nikola net cash used in investing activities is expected to continue to increase substantially as we buildout and tools the North American truck manufacturing facility in Coolidge, Arizona and develop the network of hydrogen fueling stations.

        Ournet cash used in investing activities was $1.4 million for the three months ended March 31, 2020, which was due to purchases and deposits on capital equipment forresearch and development testing equipment and software purchases.

        Ournet cash used in investing activities was $9.9 million for the three months ended March 31, 2019, which was primarily due to purchases and deposits on capital equipmentof $5.8 million and $4.0 million related to the construction of our headquarters.

Cash Flows from Financing Activities

        Through March 31, 2020, Legacy Nikola raised aggregate gross proceeds of approximately $435.1 million, of which$355.1 million was in the form of cash, from sales of redeemable convertible preferred stock. Additionally, in April 2020, Legacy Nikola received cash of $50.0 million in connection withthe issuance of its Series D redeemable convertible preferred stock.

        LegacyNikola's net cash provided by financing activities was $13.3 million for the three months ended March 31, 2020, which was primarily due to proceeds from the issuanceof Series D redeemable convertible preferred stock of $13.0 million and proceeds from tenant allowances for the construction of our headquarters of $0.9 million, offset bypayments made for future stock issuance costs of $0.4 million and Legacy Nikola's financing lease of $0.2 million.

        LegacyNikola has no cash financing activities for the three months ended March 31, 2019.

For the Years Ended December 31, 2019, 2018, and 2017

        The following table provides a summary of cash flow data:

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Cash Flows from Operating Activities

        Our cash flows from operating activities are significantly affected by the growth of our business primarily related to research and developmentand selling, general, and administrative activities. Our operating cash flows are also affected by our working capital needs to support growth in personnel-related expenditures and fluctuations inaccounts payable and other current assets and liabilities.

        Netcash used in operating activities was $80.6 million for the year ended December 31, 2019. The most significant component of our cash used during this period was a netloss of $88.7 million, which included non-cash expenses of $8.0 million for in-kind services, $4.9 million related to stock-based compensation, loss of $3.3 million relatedto the change in fair value of our Series A redeemable convertible preferred stock warrant liability and $2.3 million related to depreciation and amortization,and net cash outflows of $10.6 million from changes in operating assets and liabilities. The net cash outflows from changes in operating assets and liabilities were primarily the result of adecrease in accounts payable due to related parties of $9.3 million, primarily related to the completion of certain outside development projects and settlement of related liabilities.

        Netcash used in operating activities was $54.0 million for the year ended December 31, 2018. The largest component of our cash used during this period was a net loss of$64.3 million, which included non-cash charges of $3.8 million related to stock-based compensation, gains of $3.5 million related to the change in fair value of ourSeries A redeemable convertible preferred stock warrant liability, a benefit of $2.0 million related to deferred income taxes, and $0.6 million related to depreciation andamortization expense, and net cash inflows of $11.6 million from changes in operating assets and liabilities. The net cash inflows from changes in operating assets and liabilities wereprimarily the result of an increase in accounts payable and accrued expenses and other current liabilities of $6.6 million and an increase in accounts payable due to related parties of$8.5 million.

        Netcash used in operating activities was $13.6 million for the year ended December 31, 2017. The largest component of our cash used during this period was a net loss of$17.6 million, which included non-cash charges of $2.7 million related to stock-based compensation, a benefit of $1.6 million related to our deferred income taxes, expense of$1.0 million related to the change in fair value of our Series A redeemable convertible preferred stock warrant liability, $0.4 million in depreciation and amortization expense,and net cash inflows of $1.5 million from changes in operating assets and liabilities.

Cash Flows from Investing Activities

        We continue to experience negative cash flows from investing activities as we expand our business and build our infrastructure. Cash flows frominvesting activities primarily relate to capital expenditures to support our growth. Net cash used in investing activities is expected to continue to increase substantially as we build out and toolour North American truck manufacturing facility in Coolidge, Arizona and develop the network of hydrogen fueling stations.

        Netcash used in investing activities was $39.3 million for the year ended December 31, 2019, which was primarily due to purchases and deposits on capital equipment of$21.1 million and $18.2 million related to the construction of our headquarters.

        Netcash used in investing activities was $15.4 million for the year ended December 31, 2018, which was primarily due to purchases and deposits on capital equipment of$9.2 million, $3.4 million related to the construction of our headquarters, and the issuance of a note receivable to a related party of $2.5 million.

        Netcash used in investing activities was $2.5 million for the year ended December 31, 2017, which was primarily due to purchases and deposits on capital equipment of$2.0 million and cash paid for acquisitions of $0.5 million.

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Cash Flows from Financing Activities

        Through December 31, 2019, we raised aggregate gross proceeds of approximately $401.8 million, of which $341.8 million wasin the form of cash, from sales of redeemable convertible preferred stock. Additionally, in January and February 2020, we received cash of $12.3 million in connection with the issuance of ourSeries D redeemable convertible preferred stock.

        Netcash provided by financing activities was $35.8 million for the year ended December 31, 2019, which was primarily due to proceeds from the issuance of Series Dredeemable convertible preferred stock of $65.0 million and proceeds from the exercise of the Series A redeemable convertible preferred stock warrants of $2.2 million, offset bythe repurchase of Series B redeemable convertible preferred stock of $31.4 million.

        Netcash provided by financing activities was $211.7 million for the year ended December 31, 2018, which was primarily due to net proceeds from the issuance ofSeries C redeemable convertible preferred stock of $209.0 million and proceeds from borrowings of $4.1 million related to the term note, offset by the retirement ofSeries B redeemable convertible preferred stock of $1.4 million.

        Netcash provided by financing activities was $45.6 million for the year ended December 31, 2017, which was primarily due to net proceeds from the issuance ofSeries B redeemable convertible preferred stock of $44.0 million, proceeds from borrowings of $2.9 million, and proceeds from the exercise of Series A redeemableconvertible preferred stock warrant liability of $1.0 million, offset by the repayment of $3.3 million in borrowings.

Contractual Obligations and Commitments

        The following table summarizes our contractual obligations and other commitments as of December 31, 2019, and the years in which theseobligations are due:

        Purchaseobligations include purchase orders and agreements with a total term exceeding one year, to purchase goods or services that are enforceable, legally binding, and where thesignificant terms and minimum purchase obligations are stipulated.

        Inaddition, we enter into agreements in the normal course of business with vendors for research and development services and outsourced services, which are generally cancelable uponwritten notice. These payments are not included in this table of contractual obligations.

        Aspart of our arrangement with Iveco, once we commence commercial production, we are obligated to pay Iveco a royalty of 1.0% on BEV truck revenues and 1.25% on FCEV truck revenues overa period of seven years. We have not included royalty payments with respect to the licensed Iveco technology in the table above as the timing and amount of such obligations are unknown or uncertain.See Note 6 to our consolidated financial statements for further information.

        Forthe three months ended March 31, 2020, there have been no material changes to Legacy Nikola's significant contractual obligations.

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Waitlist and Reservations

        Potential FCEV customers may reserve slots in our future production schedule by submitting a reservation request on our website. No deposit isrequired to be paid by the customer. We stopped soliciting FCEV reservations in fiscal 2019 in order to focus on large corporate dedicated customers. We consider the reservation list as an indicationof potential demand rather than a product backlog for pending vehicle sales, as customers have not made firm commitments to order and take deliveries of vehicles and may cancel such reservations atany time. As we near commercial production in 2023, we expect to convert existing FCEV reservations into binding orders.

        Asof March 31, 2020, Legacy Nikola had approximately 14,000 reservations for FCEV trucks.

        Weonly accept binding orders on BEV trucks, which are negotiated on a case by case basis.

Off-Balance Sheet Arrangements

        Since the date of Legacy Nikola's incorporation, we have not engaged in any off-balance sheet arrangements, as defined in the rules andregulations of the SEC.

Critical Accounting Policies and Estimates

        Our financial statements have been prepared in accordance with GAAP. The preparation of these financial statements requires us to make estimatesand assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities as of the date of the financial statements, as well as the reportedexpenses incurred during the reporting periods. Our estimates are based on our historical experience and on various other factors that we believe are reasonable under the circumstances, the results ofwhich form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources.

        Actualresults may differ from these estimates under different assumptions or conditions. We believe that the accounting policies discussed below are critical to understanding ourhistorical and future performance, as these policies relate to the more significant areas involving management's judgments and estimates.

        Whileour significant accounting policies are described in the notes to our consolidated financial statements, we believe that the following accounting policies are most critical tounderstanding our financial condition and historical and future results of operations:

•

stock-based compensation and common stock valuation; and



•

intangible assets.

Stock-Based Compensation and Common Stock Valuation

        We recognize the cost of share-based awards granted to employees and directors based on the estimated grant-date fair value of the awards. Costis recognized on a straight-line basis over the service period, which is generally the vesting period of the award. We recognize stock-based compensation costs and reverse previously recognized costsfor unvested options in the period forfeitures occur. We determine the fair value of stock options using the Black-Scholes option pricing model, which is impacted by the followingassumptions:

•

Expected Term—We use the simplified method when calculating the expected term due to insufficient historical exercise data.



•

Expected Volatility—As our shares are not actively traded, the volatility is based on a benchmark of comparable companies withinthe automotive and energy storage industries.

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•

Expected Dividend Yield—The dividend rate used is zero as we have never paid any cash dividends on Common Stock or Legacy Nikolacommon stock and do not anticipate doing so in the foreseeable future.



•

Risk-Free Interest Rate—The interest rates used are based on the implied yield available on U.S. Treasury zero-coupon issues withan equivalent remaining term equal to the expected life of the award.

Common Stock Valuations

        The grant date fair value of Legacy Nikola common stock was determined by Legacy Nikola's board of directors with the assistance of managementand an independent third-party valuation specialist. The grant date fair value of Legacy Nikola common stock was determined using valuation methodologies which utilizes certain assumptions, includingprobability weighting of events, volatility, time to liquidation, a risk-free interest rate, and an assumption for a discount for lack of marketability (Level 3 inputs). Based on our earlystage of development and other relevant factors, we determined that an Option Pricing Model ("OPM") was the most appropriate method for allocating our enterprise value to determine the estimated fairvalue of Legacy Nikola common stock. Application of the OPM involves the use of estimates, judgment, and assumptions that are highly complex and subjective, such as those regarding our expected futurerevenue, expenses, and cash flows, discount rates, market multiples, the selection of comparable companies, and the probability of future events. Specifically, we have historically used the OPMbacksolve method to estimate the fair value of Legacy Nikola common stock, which derives the implied equity value for one type of equity security from a contemporaneous transaction involving anothertype of security, shares of our redeemable convertible preferred stock in this instance.

        Asof June 3, 2020, our stock is publicly traded and the fair value of our Common Stock is based on the closing price of our Common Stock on or around the date of grant.

Intangible Assets

        Intangible assets consist of licenses, in-process research and development, and trademarks, and are stated at cost less accumulatedamortization. In-process research and development has an indefinite useful life until completion of the related research and development efforts and will subsequently be amortized over an estimateduseful life. All other intangible assets have been determined to have finite lives and are amortized on a straight-line basis over their estimated remaining economic lives.

        Forintangible assets acquired in a non-monetary exchange, the estimated fair value of the consideration transferred is used to establish their recorded values.

        Significantjudgments are required in assessing impairment of intangible assets and include identifying whether events or changes in circumstances require an impairment assessment,estimating future cash flows, determining appropriate discount and growth rates and other assumptions. Changes in these estimates and assumptions could materially affect the determination of fairvalue whether an impairment exists and if so the amount of that impairment.

        Intesting indefinite-lived intangible assets for impairment, we first assess qualitative factors to determine if a quantitative impairment test is necessary. Further testing is onlyrequired if we determine, based on the qualitative assessment, that it is more likely than not that the indefinite-lived intangible asset's fair value is less than its carrying amount. If we determinebased on the qualitative assessment that it is more likely than not that the asset is impaired, an impairment test is performed by comparing the fair value of the indefinite-lived intangible asset toits carrying amount.

        Factorsconsidered which could trigger a further impairment review include, but are not limited to, significant under-performance relative to historical or projected future operatingresults, significant

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changesin the manner of use of the acquired assets or our overall business strategy, and significant industry or economic trends. When the carrying value of a long-lived asset may not be recoverablebased on the existence of one or more of the above indicators, recoverability is determined by comparing the carrying amount of the asset to net future undiscounted cash flows that the asset isexpected to generate. An impairment charge would then be recognized equal to the amount by which the carrying amount exceeds the fair-market value of the asset.

        Definite-livedintangible assets are tested for impairment whenever events or changes in circumstances indicate the carrying amount may not be recoverable. The events and circumstanceswe monitor and consider include significant decreases in the market price for similar assets, significant adverse changes to the extent and manner in which the asset is used, an adverse change inlegal factors or business climate, an accumulation of costs that exceed the estimated cost to acquire or develop a similar asset, and continuing losses that exceed forecasted costs. When the carryingvalue of an intangible asset is not recoverable based on the existence of one or more of the above indicators, recoverability is determined by comparing the carrying amount of the asset to net futureundiscounted cash flows that the asset is expected to generate. An impairment charge would then be recognized equal to the amount by which the carrying amount exceeds the fair value of the asset.

Emerging Growth Company Status

        We are an emerging growth company ("EGC"), as defined in the JOBS Act. The JOBS Act permits companies with EGC status to take advantage of anextended transition period to comply with new or revised accounting standards, delaying the adoption of these accounting standards until they would apply to private companies. We have elected to usethis extended transition period to enable us to comply with new or revised accounting standards that have different effective dates for public and private companies until the earlier of the date we(i) are no longer an emerging growth company or (ii) affirmatively and irrevocably opt out of the extended transition period provided in the JOBS Act. As a result, our financialstatements may not be comparable to companies that comply with the new or revised accounting standards as of public company effective dates.

        Inaddition, we intend to rely on the other exemptions and reduced reporting requirements provided by the JOBS Act. Subject to certain conditions set forth in the JOBS Act, if, as anEGC, we intend to rely on such exemptions, we are not required to, among other things: (i) provide an auditor's attestation report on our system of internal controls over financial reportingpursuant to Section 404(b) of the Sarbanes-Oxley Act; (ii) provide all of the compensation disclosure that may be required of non-emerging growth public companies under the Dodd-FrankWall Street Reform and Consumer Protection Act; (iii) comply with any requirement that may be adopted by the PCAOB regarding mandatory audit firm rotation or a supplement to the auditor'sreport providing additional information about the audit and the financial statements (auditor discussion and analysis); and (iv) disclose certain executive compensation-related items such asthe correlation between executive compensation and performance and comparisons of the Chief Executive Officer's compensation to median employee compensation.

        Wewill remain an EGC under the JOBS Act until the earliest of (i) the last day of our first fiscal year following the fifth anniversary of the first sale of our Common Stock inour initial public offering, (ii) the last date of our fiscal year in which we have total annual gross revenue of at least $1.07 billion, (iii) the date on which we are deemed tobe a "large accelerated filer" under the rules of the SEC with at least $700.0 million of outstanding securities held by non-affiliates, or (iv) the date on which we have issued morethan $1.0 billion in non-convertible debt securities during the previous three years. We expect this to occur during fiscal 2020.

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Recent Accounting Pronouncements

Note 2to our unaudited consolidated financial statements and notes thereto, contained elsewhere in this prospectus, provides more informationabout recent accounting pronouncements, the timing of their adoption, and our assessment, to the extent we have made one, of their potential impact on our financial condition and results ofoperations.

Internal Control Over Financial Reporting

        In connection with the audit of our financial statements for the year ended December 31, 2017, our independent registered publicaccounting firm had identified material weaknesses in our internal controls. A material weakness is a deficiency or a combination of deficiencies, in internal control over financial reporting, suchthat there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis. The material weakness in ourinternal control over financial reporting for the year ended and as of December 31, 2017 was as follows:

•

We did not maintain adequate processes and controls and accounting expertise to execute, review and approve all aspects of the financialstatement close and reporting process. Specifically, we did not maintain adequate controls related to the recording of our stock-based compensation expense or Series A redeemable convertiblepreferred stock warrants. Additionally, we did not maintain the proper cut-off of expenses.

        Ourremediation efforts for these material weaknesses have included:

•

We have recruited additional personnel, in addition to utilizing third-party consultants and specialists, to supplement our internal resources.



•

We have expanded cross-functional involvement and input into period end expense accruals, as well as implemented process improvements in theprocure-to-pay cycle;



•

Finally, we have been and continue designing and implementing additional automation and integration in our financially significant systems.

        Weplan to continue to assess our internal controls and procedures and intend to take further action as necessary or appropriate to address any other matters we identify.

        Nomaterial weaknesses were identified in connection with the audit of our financial statements for the years ended December 31, 2018, and 2019.

Quantitative and Qualitative Disclosures About Market Risk

        We are exposed to a variety of market and other risks, including the effects of changes in interest rates, inflation, and foreign currencyexchange rates, as well as risks to the availability of funding sources, hazard events, and specific asset risks.

Interest Rate Risk

        The market risk inherent in our financial instruments and our financial position represents the potential loss arising from adverse changes ininterest rates. As of December 31, 2019, and March 31, 2020 we had cash and cash equivalents of $85.7 million and $75.5 million, respectively, consisting ofinterest-bearing money market accounts for which the fair market value would be affected by changes in the general level of U.S. interest rates. However, due to the short-term maturities andthe low-risk profile of our investments, an immediate 10% change in interest rates would not have a material effect on the fair market value of our cash and cash equivalents.

Foreign Currency Risk

        There was no material foreign currency risk for the three months ended March 31, 2020 or years ended December 31, 2019, 2018 or2017.

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BUSINESS

Company Overview

Who We Are

        Nikola's vision is to be the zero-emissions transportation industry leader. We plan to realize this vision through world-class partnerships,groundbreaking R&D, and a revolutionary business model.

        Accordingto the Environmental Protection Agency ("EPA") and the European Environment Agency ("EEA"), the transportation industry causes an estimated 25% to 30% of U.S. and EU greenhousegas ("GHG") emissions. While heavy-duty trucking represents less than 10% of the overall industry, it is responsible for approximately 40% of transportation industry GHG according to the InternationalCouncil on Clean Transportation ("ICCT"). With ever-expanding e-commerce freight demands, zero-emission vehicles are believed to be one of the only viable options for a sustainable future.

        Weare a vertically integrated zero-emissions transportation systems provider that designs and manufactures state-of-the-art battery-electric and hydrogen, fuel cell electric vehicles,electric vehicle drivetrains, energy storage systems, and hydrogen fueling stations. Our core product offering is centered around our battery-electric vehicle ("BEV") and hydrogen fuel cell electricvehicle ("FCEV") Class 8 semi-trucks.

        Weoperate in three business units: Truck, Energy and Powersports. The Truck Business Unit is developing and commercializing BEV and FCEV Class 8 trucks that provideenvironmentally friendly, cost-effective solutions to the short-haul, medium-haul and long-haul trucking sector. The Energy Business Unit is developing and constructing a network of hydrogen fuelingstations to meet hydrogen fuel demand for our FCEV customers. The Powersports Business Unit is developing electric vehicle solutions for military and outdoor recreational applications.

        Thekey differentiator of our business model is our planned network of hydrogen fueling stations. Historically, investing in alternative fuel vehicles represented a high risk for bothoriginal equipment manufacturers ("OEMs"), and customers due to the uncertainty of the fueling infrastructure. Existing fuel providers have little incentive to develop an alternative fuelinfrastructure due to a lack of known demand. The inability to tackle both sides of this equation has prohibited hydrogen from reaching its potential. Nikola's approach aims to solve "the chicken orthe egg" problem.

        ForFCEV customers, we are offering a revolutionary bundled lease model, which provides truck, hydrogen fuel, and maintenance for a fixed price per mile, over 7 years or 700,000miles, whichever comes first. Our bundled lease model significantly de-risks infrastructure development by locking in fuel demand from our dedicated route customers prior to the construction of eachstation. This locked in demand ensures high station utilization from day one.

        Webelieve our station network will provide a competitive advantage and help accelerate the adoption of our FCEVs. We believe our product portfolio and hydrogen fueling network providesa key strategic advantage that differentiates Nikola from competitors and will allow us to disrupt the estimated $600 billion global heavy-duty commercial vehicle and the related fueling andmaintenance ecosystems.

Market

Total Addressable Market

        Nikola's unique bundled lease which includes the FCEV truck, fuel, and maintenance, will allow us to expand our total addressable marketsignificantly when compared to traditional OEMs.

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        Globally,the total addressable market ("TAM"), is estimated to be a $600 billion per-year with steady growth expected to continue as e-commerce and global economic growth fuelthe need for more heavy-duty trucks.

        Basedon data provided by ACT Research, the estimated $600 billion TAM is as follows:

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Global Class 8 Truck Sales Market:  Approximately$118 billion ($36 billion U.S. market, $32 billion EU market, $50 billion rest of world ("ROW"))



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Global Fueling Market:  Approximately $367 billion($63 billion U.S. market, $93 billion EU market, $211 billion ROW)



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Global Service and Maintenance Market:  Approximately $112 billion($29 billion U.S. market, $26 billion EU market, $57 billion ROW)

        Accordingto ACT Research, the active Class 8 truck population is expected to grow by approximately 5.0% annually from 2019 to 2023. This growth is supported by annualdouble-digit growth in e-commerce and a healthy global economic outlook.

Class 8 Market Segmentation

Private Fleet vs. For-Hire Fleet Segmentation

        ACT Research segments the on-highway Class 8 freight market between private and for-hire fleets, representing 53% and 47% of theClass 8 market, respectively. Private fleets, such as Anheuser-Busch ("AB"), Walmart, are almost all regular route operations or "dedicated" routes running point-to-point. The for-hire market,such as JB Hunt, XPO Logistics, can be further broken down into: contract 32%, spot 12%, and dedicated 3%. Dedicated for-hire fleets are mostly outsourced private fleets that run point-to-point.

Length of Haul Segmentation

        ACT breaks down the Class 8 truck market by the length-of-haul. The length-of-haul refers to the distance of an outbound load, and doesnot account for a return trip.

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Short-haul less than 100 miles: applications include agricultural and drayage operations.



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Medium-haul 100-250 miles: applications include Private Fleet Distribution, Less than Truckload operations, and regional for-hire fleets.



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Long-haul over 250 miles: applications include regular and irregular for-hire fleets, and private fleet regular route operations.

E-commerce Driving Expansion of Freight Moved by Trucks

        According to the Freight Analysis Framework and the U.S. Department of Transportation Statistics, in 2017, approximately 40% of all freight wasmoved by trucks in the U.S. That number is expected to grow to approximately 45% through 2035, and to approximately 50% through 2045. According to Eurostat, in Europe, approximately 52% of all freightin 2017 was moved by trucks. That number is expected to grow approximately 30% through 2030. According to ACT Research, globally, the active Class 8 truck population is expected to increasefrom 7.3 million in 2018, to 9.2 million in 2023, as emerging markets drive volume growth.

Shift to Zero-Emission Vehicles

        According to the EPA and the EEA the transportation industry causes an estimated 25% to 30% of U.S. and EU greenhouse gas emissions. Whileheavy-duty trucking represents less than 10% of the

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vehiclepopulation, the ICCT estimates it is responsible for approximately 40% of emissions from the transportation industry, making them disproportionate contributors to pollution. Diesel vehiclesare a major source of harmful air pollutants and GHG emissions. The associated local air pollution, particulates of oxides of nitrogen and particulate matter emissions, negatively impacts health andquality of life. Additionally, diesel exhaust has been classified as a potential human carcinogen by the EPA and the International Agency for Research on Cancer. Studies done on exposure to highlevels of diesel exhaust indicate a greater risk of lung cancer.

        Asignificant share of global GHG emissions stem from heavy-duty vehicle transportation. We believe zero-emission vehicles are one of the only viable options to reduce emissions in thetransportation sector to meet climate, ozone, and regulatory targets. According to the U.S. Emissions Center for Climate and Energy Solutions, in 2017, U.S. GHG emissions totaled 6,457 millionmetric tons ("MMT") of CO₂ equivalents. Medium and heavy-duty vehicles accounted for 7% of total emissions, equal to 431 MMT of CO₂ equivalents. The EEA's report on GHG inEurope found that in 2017, EU GHG emissions totaled 4,481 MMT of CO₂ equivalents. Heavy-duty vehicles accounted for 5% of total emissions, equal to 224MMT of CO₂ equivalents.

        Astrong consensus among the largest governments calls for a global push to shift to zero-emission vehicles and the eventual elimination of internal combustion engine ("ICE") vehicles.According to the Center for Climate Protections "Survey on Global Activities to Phase Out ICE Vehicles" report, actions being taken by national and local governmentsinclude:

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The following cities signed the C40 Fossil-Fuel-Free Streets Declaration: Electric buses by 2025, ICE vehicles banned by 2030: Athens,Auckland, Barcelona, Cape Town, Copenhagen, Heidelberg, London, Los Angeles, Madrid, Milan, Mexico City, Paris, Quito and Rome.



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Additionally, Delhi, Hamburg, Oslo, Oxford, and Tokyo, have all began to implement and propose plans to move towards all zero-emissionsvehicles.

Countries Phasing Out ICE Vehicles (specific actions vary by country):

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Austria: No new ICE vehicles sold after 2020



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China: End production and sales of ICE vehicles by 2040



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Costa Rica: Initiate complete phase-out of ICE vehicles by 2021



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Denmark: 5,000 EVs on the road by 2019, tax incentive in place



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France: Ban the sale of petrol and diesel cars by 2040



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Germany: No registration of ICE vehicles by 2030 (passed by legislature); cities can ban diesel cars



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India: Official target: No new ICE vehicles sold after 2030; Incentive program in place for EV sales



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Ireland: No new ICE vehicles sold after 2030



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Israel: No new ICE vehicle imports after 2030



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Japan: Incentive program in place for EV sales



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Netherlands: No new ICE vehicles sold after 2030; Phase out begins 2025



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Norway: Sell only electric and hybrid vehicles starting in 2025



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Portugal: Official target and incentive in place for EV Sales



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Scotland: No new ICE vehicles sold after 2032

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South Korea: EVs account for 30% of auto sales by 2020



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Spain: Incentive package to promote sales of alternative energy vehicles



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Sweden: Ban of ICE vehicles in 2030



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Taiwan: Phase out fossil fuel-powered motorcycles by 2035 and fossil fuel-powered vehicles by 2040. Additionally, the replacement of allgovernment vehicles and public buses with electric versions by 2030.



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United Kingdom: Ban the sale of petrol and diesel cars starting in 2035—No new ICE vehicles sold

        Withsuch strong sentiment to reduce global GHG emissions from leading governments, OEMs will have to spend significant additional R&D on existing models to remain compliant inthe near term, or they will face heavy fines. In the EU, there will be a mandatory 15% reduction in CO₂ emissions by2025, and a 30% reduction target by 2030. There will be a financial penalty for failure to achieve these targets. The level of the penalties is 4,250 Euros and 6,800 Euros pergCO₂ / tonne-kilometre ("tkm") in 2025 and 2030, respectively. Conventional diesel technology will most likely not be able to meet the EU targets set for 2025 and 2030. These ambitiousCO₂ targets are likely "technology-forcing" towards alternative powertrains such as battery-electric and hydrogen fuel cell.

        Inaddition, consumers are increasingly demanding that corporations take action to reduce their carbon footprint. An article by Nielsen cited that nearly half (48%) of U.S. consumers saythey would "definitely" or "probably" change their consumption habits to reduce their impact on the environment, placing reducing emissions high on the agenda for large corporates. Forexample:

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Amazon has pledged to become carbon neutral by 2040;



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BP has pledged to become carbon neutral by 2050;



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DB Schenker plans to reduce specific CO2 emissions by 30% before 2020 and 50% before 2030, compared to 2006 baseline;



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DHL set a goal to reduce all logistics-related emissions to zero by 2050;



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UPS has committed to sourcing 40% of its ground fuel will be sourced from low carbon or alternative fuels by 2025; and



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Walmart set a goal of an 18% emissions reduction in their own operations by 2025 and to work with suppliers to reduce emissions by 1 gigaton by2030.

Hydrogen Fuel Cell and Battery Technology Momentum

        With the global push to eliminate ICE vehicles, battery-electric and fuel cell technologies stand out as the best alternatives to diesel. Bothbattery costs, a key cost competent of a BEV, and electricity prices, a key cost component in hydrogen fuel production, have decreased significantly over the past decade, and prices continue to fall.These cost reductions significantly improve the economics of BEVs and FCEVs.

        AJanuary 2020 report published by the Hydrogen Council highlighted how policy and economic forces are converging, creating unprecedented momentum in the hydrogen sector. This momentumis buoyed by:

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66 countries having announced net zero-emissions as a target by 2050;



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Approximately 80% decrease in global average renewable energy prices since 2010; and



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Expected 55 times growth in electrolysis capacity by 2025 compared to 2015.

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Zero-Emission Vehicles Enabled by Significant Reduction in Battery Cost and Renewable ElectricityPrices

        The majority of the cost of production of a BEV truck, and a major cost component of a FCEV truck, lie in the cost of the battery. Asillustrated in a 2019 report by BloombergNEF, from 2010 to 2018, Lithium-Ion battery prices have fallen from $1,160 per kilowatt-hour ("kWh") to $176 per kWh, representing an 85% cost reduction. Asinvestment in battery technology continues to increase as a result of OEMs allocating more capital to next-generation powertrain technology, this trend in battery cost reduction is expected tocontinue.

        Thatbeing said, vehicles that run on lithium-ion battery-electric power can experience battery capacity and performance loss over time, depending on the use and age of the battery. Forexample, depending on the battery chemistry of the specific cells inside a vehicle battery pack, after approximately 1,000 to 1,500 charge and discharge cycles, energy capacity retention is about 80%.In moderate weather conditions, a fully charged battery sitting idle can lose about 2% to 5% of its charge over a 30-day period. Also, as a battery ages, it loses approximately 2% of its energycapacity retention, year over year. We anticipate that the lithium-ion battery packs in our BEV and FCEV trucks will perform similar to these current industry standards.

        Forhydrogen production, electricity costs account for approximately 75% to 85% of the total cost. Per Lazard's November 2019 Levelized Cost of Energy Analysis, the cost of producingrenewable energy has dropped significantly since 2009. In 2009, the global average solar and wind levelized cost of energy was $359 per megawatt-hour ("MWh"), and $135 per MWh, respectively. In 2019,these costs were $40 per MWh for solar and $41 per MWh for wind, representing a cost reduction of 89% and 70%, respectively.

        Renewableenergy prices are expected to continue to fall as production capacity is set to double from 2019 to 2024. This trend will further reduce renewable energy prices, which willdrive the cost of hydrogen production even lower.

        Accordingto Wood Mackenzie, in the U.S., the world's second-largest solar market, power purchase agreements ("PPAs") are now trending between $20 to $30 per MWh, and on a global scale,prices have been observed as low as $17 per MWh. Lower solar energy production cost is expected to allow us to produce renewable hydrogen at a cost that is competitive with existing diesel solutions.

Industry Focused on TCO

        In the highly competitive trucking industry, when choosing between truck models that meet their technical requirements, customers mainly basetheir purchasing decision on total cost of ownership ("TCO"). TCO is the total cost of owning the truck through its lifecycle, including lease cost or purchase payment, fuel cost, service, andmaintenance. According to ACT Research, traditionally, TCO for diesel trucks (excluding driver wages, benefits, and insurance), is typically broken down into cost of fuel (approximately 50%), purchaseor lease payments on truck (approximately 22%), and repairs and maintenance (approximately 28%).

        Historically,diesel fuel comprises 40% to 60% of TCO, depending on prevailing diesel fuel prices. With the incumbent ICE technology, fleet operators are also forced to accept volatilityin their largest cost component, creating risk and uncertainty. Our bundled lease will provide customers TCO clarity for the first time in the industry's history.

Industry and Competition

        Competition in the Class 8 heavy-duty truck industry is intense and new regulatory requirements for vehicle emissions, technologicaladvances, and shifting customer demands are causing the industry

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toevolve towards zero-emission solutions. We believe the primary competitive factors in the Class 8 market include, but are not limited to:

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total cost of ownership (TCO);



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product performance and uptime;



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availability of charging or re-fueling network;



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emissions profile;



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vehicle quality, reliability and safety;



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technological innovation;



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improved vehicle operational visibility;



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ease of autonomous capability development; and



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service options.

        Similarto traditional OEMs in the passenger vehicle market, incumbent commercial transportation OEMs are burdened with legacy systems and the need to generate sufficientreturn on existing infrastructure, which has created a reluctance to embrace new zero-emission drivetrain technology. Thisreluctance creates opportunity for Nikola and has allowed us to gain a significant head start against our competition.

        However,we believe the global push for lower emissions combined with vast technological improvements in fuel cell and battery-electric powertrain technologies has awakenedwell-established OEMs to begin investing in zero-emission vehicle platforms.

BEV Competition

        Tesla, Daimler, Volvo, as well as other automotive manufactures, have announced their plans to bring Class 8 BEV trucks to the marketover the coming years. Tesla announced its concept vehicle, the Tesla Semi, in November 2017. Daimler announced its plans for the eCascadia, which is the electric version of their flagshipFreightliner Cascadia, in June 2018. Volvo announced plans to commercialize its BEV heavy-duty truck, the VNR Electric, in December 2018. Other competitors include BYD, who we believe is currentlyselling Class 8 BEV trucks, Peterbilt, XOS, and potentially Cummins.

FCEV Competition

        Due to higher barriers to entry, there are fewer competitors in the FCEV Class 8 market. However, Hyundai and Toyota have chosen to focustheir efforts on FCEV as the powertrain of the future. Hyundai intends to enter the European market for medium-duty vehicles with their fuel cell truck, the Hyundai Xcient. In addition, others such asHyundai have announced they plan to offer FCEV trucks and invest in hydrogen stations for refueling. Toyota is collaborating with Kenworth, an American manufacturer for medium- and heavy-dutyClass 8 trucks, to jointly develop a hydrogen fuel cell heavy-duty truck, and Daimler and Volvo recently announced a proposed joint venture to develop fuel cell systems for heavy-duty trucks.

Competitors in Context

        Most of our current and potential competitors have greater financial, technical, manufacturing, marketing, and other resources than we do. Theymay be able to deploy greater resources to the design, development, manufacturing, distribution, promotion, sales, marketing and support of their electric and hydrogen fuel cell truck programs.Additionally, our competitors also have greater name

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recognition,longer operating histories, larger sales forces, broader customer and industry relationships, and other resources than we do.

        Althoughour competitors may have certain advantages we do not possess, we believe we are positioned to compete favorably. Although we do not have the same name recognition, or operatinghistories as our competition, we are free from the burden of legacy infrastructure and design. We believe we have the benefit of a head start and the advantage of beginning from a blank slate, whichis critical when introducing revolutionary technology.

        Webelieve that one potential competitor, BYD, is currently selling Class 8 BEV trucks, while we believe other potential competitors are in various stages of rolling out theirvehicles, including pilot programs and providing test vehicles to customers. We cannot provide assurances that our trucks will be among the first to market, or that competitors will not build hydrogenfueling stations that compete with our planned stations. Even if our trucks are first to market, we cannot assure you that customers will choose our vehicles over those of our competitors, or overdiesel powered trucks.

Products

        As the commercial transportation sector transitions towards zero-emission solutions, we believe there will be a need to offer tailored solutionsthat meet the needs of each customer. Unlike the passenger vehicle market, where users typically return home each day, the commercial vehicle market contains multiple use cases often requiringvehicles to be out on the road for days, or weeks at a time. By offering both BEVs (for short-haul) and FCEVs (for medium- andlong-haul), we believe Nikola is uniquely positioned to disrupt the commercial transportation sector by providing solutions that address the full range of customer needs.

        BEVsand FCEVs have identical e-Axles and similar truck designs, representing significant synergies in the manufacturing process between BEVs and FCEVs.

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Our Zero-Emission Product Offerings

        We have developed an extensive portfolio of proprietary technologies that are embedded and integrated in our highly specialized BEV and FCEVzero-emission vehicles. In addition, we plan to leverage our zero-emission powertrain expertise to address transportation adjacencies as exemplified with our Powersports product offerings. Ourprincipal vehicle offerings include:

Nikola Tre—Class 8 BEV & FCEV Truck

        TheNikola Tre Class 8 truck is based on the new S-WAY platform of Iveco, and integrates our truck technology, controls and infotainment. The cab-over design is desirable for citycenter applications due to shorter vehicle length, tighter turning radius and better visibility. In the U.S., the Nikola Tre BEV will be marketed for short-haul applications. In Europe, the Nikola TreBEV will also be sold to the short-haul market. The Nikola Tre FCEV will be marketed to the European medium and long-haul markets.

        TheBEV version of Nikola Tre will be the first to market, addressing the near-term market opportunity as this version does not require a roll-out of charging infrastructure. BEVs run ona fully electric drivetrain powered by rechargeable batteries. Nikola's BEV has an estimated range of 250 to 300 miles and is designed to address the short-haul market. During the initial roll-out,customers will be responsible for their own charging needs.

        Salesof the Nikola Tre BEV are expected to begin in 2021, addressing the near-term market opportunity, while sales for the European Nikola Tre FCEV is expected to start in 2023. All BEVsales will be made through direct sales to customers.

Nikola One and Two—Class 8 FCEV Trucks

        TheNikola One (Class 8 sleeper cab) and Nikola Two (Class 8 day cab) are Nikola's FCEV trucks that are primarily designed for medium and long-haul applications. TheFCEV trucks allow Nikola to address the longer-term opportunity by combining Nikola's fuel cell technology and a network of hydrogen stations across the U.S.

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        FCEVsuse fuel cells on-board to convert hydrogen into electricity to power the electric motors which transmit power to the wheels. The fuel cell generates electricity through a chemicalreaction, supplied from on-board tanks, and oxygen from the atmosphere. A much smaller battery (compared to our BEV) provides supplemental power to the drivetrain, and stores energy recovered duringregenerative braking. The voltage and charge of the battery are maintained through a combination of power supplied from the fuel cell and energy captured through regenerative braking.

        Nikola'sFCEVs have an estimated range of up to 400 to 750 miles, designed to address the medium and long-haul market. Our FCEVs will be leased to customers via a bundled lease wherecustomers receive an FCEV truck, hydrogen fuel, and maintenance based on a fixed rate per mile, for 700 thousand miles, or 7 years (whichever comes first).

        Wealso expect that in the longer term as autonomous technologies relieve hours of service restrictions, FCEVs will be an ideal option for longer more continuous hauls.

        TheNikola Two will be marketed in the North American market, with initial production expected in the first quarter of 2023.

        Productionplans for the Nikola One will be announced once we have established a robust refueling infrastructure.

Nikola Badger

        Recently we announced the Nikola Badger (the "Badger"), an advanced zero-emission FCEV/BEV hybrid pickup truck. Unlike anything on the market,the Badger is designed to target and exceed every electric or fossil fuel pickup in its class. At this time, we are focused on the production of its Class 8 heavy-duty vehicles and do notexpect to develop production plans for the Badger unless we enter into a strategic partnership with an established OEM.

Powersports

        Our management team is primarily focused on the core semi-truck and hydrogen station programs. However, we believe that we can leverage ourzero-emission powertrain expertise to address transportation adjacencies. Our Powersports product offerings provide significant benefits to our core semi-truck and hydrogen station programs, includingbranding halo, driving awareness of Nikola and our industry-defining technology, and R&D synergies on electric drivetrain, battery technology, and other core components. These offerings include abattery-electric recreational off-highway vehicle, the

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NikolaNZT; a battery-electric military-grade off-highway vehicle, the Nikola Reckless; and a battery-electric sit-down watercraft, the Nikola Wav.

        Althoughwe are currently focused on the production of Class 8 heavy-duty vehicles, we may choose to partner with an OEM or enter into a joint venture partnership to accelerateproduction of the Nikola Powersports product portfolio.

Nikola Hydrogen Stations

        In addition to building heavy-duty zero-emission trucks, Nikola is also developing fueling and charging stations in North America and Europe tosupport our FCEV fleet customers and to help capture first mover advantage with respect to next generation fueling infrastructure. Over the next 8 to 10 years, Nikola intends to collaboratewith strategic partners to build up to 700 fueling and charging stations in North America and approximately 70 fueling and charging stations in Europe.

        Hydrogenwill normally be produced on-site at each station via electrolysis. The electrolysis process occurs by passing electricity through water in an electrolyzer, thus breaking thewater molecule into gaseous hydrogen and oxygen. Nikola's base station is expected to have a daily production capacity of 8,000 kg and will be capable of supporting approximately 210 FCEV trucks perday. Our stations are designed to be scalable to up to 40,000 kg per day of production, if needed. The stations are expected to contain at least 8 heavy-duty (for commercial trucks), and up to 4light-duty vehicle, hydrogen fueling dispensers. Nikola also plans to install electric fast charging at most of our fueling stations to support BEVs.

First Test Station Installed at Nikola's Phoenix HQ

        Through our partnership with Nel ASA, a Norwegian hydrogen company ("Nel"), we have initiated the development of the hydrogen stationinfrastructure by completing our first 1,000 kg demo station in the first quarter of 2019 at our corporate headquarters in Phoenix, Arizona. The demo hydrogen station offers hydrogen storage anddispensing and serves as a model for future hydrogen stations.

Nikola Hydrogen Fueling Stations

Hydrogen Fuel Cell Ecosystem

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Hydrogen fuel will be produced on-site and at scale, via electrolysis, or hydrogen fuel produced off-site via electrolysis and shipped tofilling location.

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Electricity input (grid, solar, wind, nuclear) will be purchased via long-term supply agreements where feasible.



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The single-station strategy allows for maximum capital efficiency. Each station will be highly utilized from the start and is expected togenerate substantial revenue and cash flow, which can be used to fund the development of future stations.

Hydrogen Station Rollout Strategy

California-First Hydrogen Station Strategy

        Our initial plan for the station rollout begins with an eight-ton pilot station accessible to the AB brewery in Van Nuys, California. Fromthere, we then plan to build up to 10 to 12 additional stations in California. These stations will supply fuel for our launch customers in those geographies that have dedicated routes in California.California is offering incentives to build out our hydrogen fueling infrastructure and deploy zero-emissions vehicles, including opportunities for funding along major freeway corridors. We expect torollout these stations in 2022-2023.

        Afterthe California station build-out, we plan to opportunistically target other states offering incentives.

Single-Station Dedicated Route Strategy (Long-Term Strategy)

        After maximizing incentives offered by states, our strategy is to build hydrogen fueling stations one at a time along dedicated routes accordingto the needs of strategically selected customers. Nikola anticipates building up to 700 stations in North America. This overall strategy is designed to enable a capital-efficient roll-out of hydrogenstations, ensuring high utilization and predictability of demand, while allowing Nikola to also sell hydrogen to third-party purchasers.

        Thelayout and freight movement along our interstate system provides ample opportunities to expand our hydrogen station network in the U.S., as road freight is concentrated along therelatively few and significant corridors that form the National Highway Freight Network.

First Stations to Support Customers with Dedicated Routes

        Initially, our fueling and charging stations will be built to support carefully selected fleet customers who have dedicated routes along majorinterstate corridors. For example, we have chosen AB as a launch customer because they have dedicated freight routes between their twelve breweries and six distribution centers. The first stationswill be built in Southern California and in Phoenix, Arizona to support AB's freight movements along Interstate 10 from their brewery in Van Nuys, California to their distribution center in Chandler,Arizona. Construction of an 8-ton pilot station accessible to AB's brewery in Van Nuys, California is expected to begin in the fourth quarter of 2020 and be completed by the fourth quarter of 2022.

EU Station Network Strategy

        The EU hydrogen station network will be built following a similar strategy. Several highly trafficked freight corridors exist in Europe, withlogistics hubs in proximity to consumption centers, freight ports, and corridor crossroads. Nikola plans to strategically deploy hydrogen stations along the key corridors and logistical hubs tomaximize the efficiency of station deployment. Ultimate station roll-out strategy and timing will also consider potential local incentives offered in the EU to ensure the most economically favorableEU station roll-out. We believe that anetwork of 70 to 90 hydrogen stations will provide approximately 85% coverage of Western European freight corridors.

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Power Sourcing Strategy, and Over Time, 100% Zero-Emission Goal

        During Nikola's initial hydrogen station roll-out, we will source power based on the most economical power mix available at each hydrogenstation. Over time, we intend to support each fueling station with 100% zero-emission power, if feasible. For example, where feasible, we will co-locate our stations accessible to solar, wind, andhydro-power generation facilities built, paid for, and operated by third-party partners. We expect to enter into a long-term PPAs with these renewable energy providers whenever practical.

Playing a Key Role in The Future of Energy Generation and Storage

        The steady off-peak demand load of Nikola's hydrogen stations, and our ability to have our power supply temporarily interrupted during peakpower demand, makes Nikola a highly attractive customer for utilities, grid operators and other power providers. Our station model also provides the critical advantage of being able to take excesspower generated during periods of low power demand. Given this power demand profile, and our ability to help optimize the energy grid, we believe we will have the opportunity to source power at pricesbelow prevailing market rates.

        Givenour ability to level out demand and store night-time and other off-peak energy that might otherwise go unused, we believe our hydrogen stations will provide critical solutions tothe future of electric energy generation, transmission, and storage and help usher in the next generation of power supply.

Nikola's Service and Maintenance

        Nikola's bundled lease includes maintenance for its vehicles. Service and maintenance of an electric vehicle is expected to be lower than thetraditional ICE vehicle which has been proven in the electric passenger vehicle market. Fewer parts and considerably reduced complexity of the key drivetrain components should result in fewerbreakdowns and less preventive maintenance, leading to better uptime and lower maintenance cost to operators. Reduced downtime could also lead to increased revenue for fleets as asset productivityincreases.

        Akey requirement for our fleet customers is knowing there is an available service infrastructure for the maintenance and repair of our vehicles. Nikola is building a strong network ofproviders, a robust preventive maintenance program, as well as several levels of service depending on the complexity and type of maintenance required.

        Nikola'splans with respect to the service and maintenance of its vehicles is expected to include the following:

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Electric vehicles have a system of sensors and controls that allow for precise monitoring of the vehicle and component operation performance.We will use this data to provide smart predictive maintenance, which will decrease downtime and costs by identifying a potential problem before it results in a breakdown.



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Nikola will have the ability to provide over the air updates and software fixes when the vehicle is stopped. This can significantly reduce thetime for repair and improve uptime.



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In cases where a customer has their own maintenance infrastructure, we will identify and provide procedures for items that can be maintained attheir shops. This could include procedures such as tire changes, wiper and windshield repair and brake servicing.



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In cases where the customer does not have a maintenance infrastructure or for more complex items, Nikola is leveraging its exclusive partnerThompson Caterpillar for maintenance and warranty work. Customers will have access to an already established network of 800 service stations as well as the ability to deploy a mobile service model. Wewill also support our partners

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withtechnologies like augmented reality and web-enabled video to support technicians for very complex tasks or newly identified issues.

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If a vehicle requires maintenance of a complex system such as the fuel cell or battery, some of those items can be swapped or replaced withrelative ease. This allows us to repair the downed component in the background and minimize vehicle downtime. We are also planning to develop a network of trained technicians that can travel to acustomer or service partner site as necessary.

Customers and Backlog

Target Customers

        Nikola targets large Class 8 fleet customers with established sustainability goals, as well as fleets operating along dedicated routesthat are located in regions offering strong incentives for developing hydrogen infrastructure and/or delivering zero-emission vehicles.

BEV Customer Strategy

        The Nikola Tre BEV truck is designed for short-haul applications, making it ideal for urban metro, inner-city, local delivery, port operations,and drayage applications. Nikola's goal in first targeting large corporates is to establish early market share and strengthen brand identity.

        ForBEVs, we expect that most early U.S. sales will be in states such as California or New York where incentive programs already exist.

FCEV Customer Strategy

        For the Nikola Two FCEV, Nikola is planning to develop and construct initial hydrogen stations in Arizona and California. Therefore, earlycustomers will be located in these states, or have extensive transportation routes within or between them.

        Wewill also target dedicated fleets with either nationwide or significant regional distribution networks and dedicated route networks (i.e., where trucks operate between twofixed points, e.g., production plant and distribution hub) along highly trafficked freight corridors. This strategy allows for gradual, strategic, and capital-efficient development of thehydrogen infrastructure required to support FCEV trucks in operation. Nikola will expand the FCEV offering to the entire Class 8 truck market once the fueling infrastructure is sufficientlydeveloped.

Customer Backlog

        The current backlog of over 14,000 FCEVs non-binding reservations represents more than two years of production and over $10 billion ofpotential revenue. The FCEV reservation book was frozen in the fall of 2019 in order for Nikola to focus on negotiating with strategic fleet partners for launch. Nikola does not hold deposits relatedto the FCEV orderbook. Nikola believes a significant portion of the existing backlog will be converted to binding orders, once we have fixed production dates for FCEV trucks as the majority of orderbook represents large corporate customers with over 100 or more trucks reserved. Additionally, Nikola will likely require a significant deposit to secure final orders at least six months prior todelivery.

        Todate, the orderbook for the Nikola Tre BEV has not been publicly opened. Instead, Nikola is working to select its initial BEV customers strategically and is in advanced dialogue withseveral large blue-chip customers. Nikola will likely select one or two launch customers to participate in fleet testing and the initial production of the Nikola Tre BEV.

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First Ever Zero-Emission Beer Run

        In November 2019, Nikola completed AB's first ever zero-emissions beer-run. The Nikola Two prototype FCEV delivered six pallets of Bud Lightweighing approximately 15,000 pounds. The total load hauled, including the trailer, was approximately 27,000 pounds. The delivery was made on city streets and was a true commercial order where thebeer was delivered to one of AB's distributors. AB's distributor then delivered the beer to the St. Louis Blues arena for consumption at that night's game.

Partnerships and Suppliers

        Nikola's vision will be realized through a revolutionary business model, groundbreaking R&D, disciplined execution, and world-classpartnerships. Our business model is validated and supported by world-class strategic partnerships that significantly reduce execution risk, improve commercialization timeline, and provide a long-termcompetitive advantage. These world-class partners have accelerated our internal development, growth, and learning and have positioned us to revolutionize the transportation sector. We believe ourpartnerships help increase the depth and breadth of our competitive advantage as well.

        Ourpartnership philosophy is a recognition that the world's toughest challenges require bold solutions and a collaborative effort from multiple parties. Our goal is to providezero-emission solutions to the transportation sector and to usher in next-generation grid solutions. With the help of our partners, we believe our chances of success are greatly improved. At Nikola,we are inspired by the knowledge that if we are successful, the whole world wins.

        Thefollowing contains a list of the world-class partners who have chosen to embark upon this journey with us. With their help, we plan to drive out emissions from the transportationsector.

Co-Development Partners

Iveco

        Iveco is a subsidiary of CNH Industrial, which designs, manufactures and distributes under the Iveco brand a wide range of light, medium andheavy commercial vehicles and off-road trucks with over 175,000 units sold annually. Iveco with its affiliates and joint ventures has significant manufacturing presence in Europe, as well asproduction facilities in Asia, Africa and Latin America, where it produces vehicles equipped with the latest technologies. Iveco can provide technical support in close proximity to their customers,the world over. Iveco is the European market leader in CNG/LNG alternative propulsion technologies for trucks.

        Duringfiscal year 2019, Legacy Nikola entered into an agreement with Iveco under which it will provide advisory services, including project coordination, drawings and documentationsupport, engineering support, vehicle integration, product validation support, purchasing, and the implementation of the Iveco World Class Manufacturing Methodology.

        Ivecoand its affiliate, FPT Industrial, S.p.A., will provide engineering and manufacturing expertise to industrialize Nikola's BEV and FCEV trucks. In Europe, we established ajoint venture with Iveco, and together, Nikola and Iveco are jointly developing cab-over BEV and hydrogen FCEV trucks for sale in the European market. In the U.S., Nikola will be responsible formanufacturing and production at our greenfield facility in Coolidge, Arizona.

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North America Engineering and Production Alliance:  Iveco is providing$100.0 million of engineering and production support and access to intellectual property valued at $50.0 million to help bring Nikola trucks to the North American market. This alliancesignificantly de-risks Nikola's operational execution by leveraging the expertise and capabilities of one of the world's

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leadingcommercial vehicle manufacturers, and Nikola retains 100% of the North American business as a result.

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Europe Joint Venture:  The Nikola and Iveco 50/50 European jointventure will leverage Iveco's engineering expertise and existing production and sales/service footprint. This joint venture allows Nikola to accelerate penetration into the attractive European marketwhile minimizing execution risk and optimizing capital allocation and Nikola's management bandwidth.

        Inaddition to the manufacturing and production expertise, one of the key benefits of this partnership is Nikola's ability to leverage Iveco's existing assortment of parts, therebydecreasing our purchasing expenses.

Bosch

        Bosch is a leading global supplier of technology and services to automotive, industrial, energy, building technology, and consumer end-marketswith approximately 410,000 employees and approximately $90 billion in annual revenue.

        WithBosch's assistance, we have re-imagined the commercial vehicle powertrain from the ground up. Bosch's rotor and stator expertise has enabled Nikola to move quickly on an aggressivepath to bring its electric truck e-Axles to market. By utilizing advanced simulation technologies throughout the development process, from system layout to testing and validation, Nikola's trucks willlaunch with one of the most optimized and state-of-the-art system designs and vehicle controls in the mobility sector.

Other Key Industry Partners

Hanwha

        Hanwha is a world leader in renewable energy and solar panel manufacturing and is partnering with Nikola to assist Nikola in obtaining cleanenergy for its hydrogen fueling network. Hanwha Q Cells is Nikola's exclusive solar panel provider (to third-party solar farm developers), which will help generate the clean electricity that iscritical to the production of renewable hydrogen.

Nel

        Nikola has partnered with Nel for the buildout of Nikola's hydrogen stations. Nel directly manufactures the most advanced hydrogen stationcomponents, including the electrolyzers, dispensing systems, and compressors.

AVL

        AVL is one of the world's largest independent companies for the development, simulation and testing of powertrains.

EDAG

        EDAG is a global engineering service provider to the commercial vehicle industry. EDAG provides Nikola cab and chassis engineering services.

WABCO

        WABCO is a leading global supplier of braking control components and air management systems to medium- and heavy-duty trucks. WABCO providesNikola with industry-leading safety technologies including electronic braking systems, as well as traction and stability control technologies.

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MERITOR

        Meritor is a leading global supplier of suspension and related components for heavy-duty trucks. Meritor provides Nikola with industry leadingsuspension technologies.

MAHLE

        Mahle is a leading global supplier of thermal management systems for heavy-duty trucks. Mahle provides Nikola with industry leading thermalmanagement system technologies.

Manufacturing and Production

Leveraging Iveco's Excess Capacity for Initial Units

        We plan to produce and sell BEV and FCEV trucks in North America and Europe. Our joint venture with Iveco provides us with manufacturingcapacity to build trucks for the U.S. market before the completion of our planned manufacturing plant in Coolidge, Arizona. Beginning in 2021, Nikola expects to utilize existing excess capacity atIveco's Ulm, Germany plant to begin production of the Nikola Tre BEV for U.S. delivery. These first trucks will be imported into the U.S. to fulfill launch customer orders. Nikola will also build theNikola Tre (both BEV and FCEV) for the EU market in Iveco's Ulm, Germany facility.

U.S. Production Facility

        In 2019, we acquired an approximately 400-acre parcel of real property in Coolidge, Arizona, which is located about 50 miles south of Phoenix,Arizona. The parcel is well suited for our planned greenfield manufacturing facility due to its proximity to the Interstate 10 highway, the Interstate 8 highway, and a railway spur that abuts theparcel.

        Inthe third quarter of 2020, we plan to begin construction of the initial phase of its approximately 1 million square foot battery-electric and hydrogen fuel cell electric truckmanufacturing plant in Coolidge, Arizona.

Phase 1—Low Volume Production—up to 5,000 units per year:

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Begin construction mid-2020



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Warehouse space (approximately 100,000 - 150,000 square feet)



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Low-volume production capacity (approximately 5,000 units per year)



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Complete construction by the end of 2021



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Commissioning and start-up with Nikola Tre BEV in production in Q1 2022

Phase 2—High Volume Production—up to 50,000 units per year:

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Begin construction early-2021



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Complete manufacturing facility (approximately 1,000,000 square feet)



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High-volume production capacity (approximately 50,000 units per year)



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Complete construction by the end of 2022



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Commissioning and start-up with Nikola Two FCEV in production in Q1 2023

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European Production

        We expect to utilize Iveco's excess capacity for the foreseeable future, giving us the ability to produce 5,000 - 10,000 units peryear. The JV may seek to build a greenfield manufacturing facility, once we have sufficient hydrogen station network density in Europe to facilitate sales over 10,000 units per year. We anticipatenational and local grants and loan support may be available to help fund a greenfield development in Europe.

Development Timeline

        The development timeline for our BEV and FCEV trucks has accelerated upon entering a production alliance with Iveco. This partnership providesus the benefit of leveraging Iveco's expertise, and the newly updated Class 8 S-WAY truck platform in the design, development, testing and validation of the Nikola Tre. By focusing initialdevelopment efforts on the BEV truck, we were able accelerated our go-to-market strategy by approximately 1-2 years.

BEV Development

        Key milestones in the commercialization of the Nikola Tre BEV truck are as follows:

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Start of pilot builds in the first half of 2020



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Showcasing of the BEV truck at the IAA commercial vehicles conference in Hannover, Germany in Fall of 2020



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Start of production at Iveco's facility in Ulm, Germany for sale into the U.S. market in the second half of 2021



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Start of production at our facility in Coolidge, Arizona for sale into the U.S. market in Q1 2022



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Start of production of EU build at Iveco's facility in Ulm, Germany for sale into the EU market in Q1 2022

FCEV Development

        Key U.S. milestones in the commercialization of the Nikola Two FCEV (U.S.) and Nikola Tre FCEV (EU) trucks are asfollows:

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Nikola Two FCEV Beta engineering and development began in Q1 2020



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Nikola Two FCEV start of pilot builds in Q3 2021



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Nikola Two FCEV Gamma builds commence in the second half of 2022—low volume production on Nikola's Coolidge, Arizona manufacturingfacility



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Nikola Two FCEV start of production at our facility in Coolidge, Arizona for sale into the U.S. market in Q1 2023



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Nikola Tre FCEV start of production at Iveco's facility in Ulm, Germany for sale into the EU market in the second half of 2023

Nikola Badger and Nikola Powersports

        At this time, we are focused on the production of Class 8 heavy-duty vehicles and do not expect to develop production plans for theBadger unless we enter into a strategic partnership with an established OEM. We may choose to partner with another OEM, or enter into a joint venture to accelerate production of the Nikola Powersportsproduct portfolio.

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Strategy

Management Team Focused on Execution and Efficient Capital Allocation

        Given the capital-intensive nature of our business model, we recognize efficient capital allocation will be an important determinant of ourlong-term success. Nikola's disciplined and creative approach to optimize capital allocation will allow us to execute on our ambitious business plan.

        Capitaloptimization measures include:

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Nikola's strategic partnerships with world-class automotive suppliers to develop leading next-generation powertraintechnology. Nikola's ability to leverage expertise from the most respected OEM and top-tier supplier brands has allowed us to accelerate the production of our product portfoliowhile minimizing development cost. Our joint venture with Iveco allows us to manufacture trucks, gain market share, and start generating revenue prior to building a greenfield manufacturing facilityby utilizing Iveco's excess capacity.



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Nikola's strategy to build its manufacturing facility in two phases.  Ourmulti-phased approach to building our greenfield production plant in the U.S. allows us to produce up to 5,000 units a year, with minimal investment, allowing us to generate revenue one full yearbefore the completion of our fully scaled manufacturing facility.



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Nikola's hydrogen station roll-out plan.  Our unique hydrogen stationroll-out plan allows us to build stations in coordination with FCEV truck deliveries, providing Nikola with revenue and cash flow, which can be used to minimize the amount of outside capital neededduring the buildout of our hydrogen station network.

Capture Early Mover Advantage

        Given the speed at which the BEV and FCEV truck market is transforming, Nikola has accelerated the production of our BEV truck to be early tomarket and expects to generate revenue by 2021. By being one of the first movers in the North American market, Nikola expects to capture a large percentage of customers and any applicablezero-emission vehicle related incentives, including incentives available to those that are early adopters of BEV technology.

Maintain Strategic Partnership Focus to Drive Execution

        Nikola's position as a pioneer in the market has attracted global leaders across Nikola's supply chain, creating an extensive network for us toleverage. Nikola's key partners include Iveco, AVL, Meritor, Bosch, WABCO, EDAG, Mahle, Nel, and others. Nikola believes the expertise and know-how of these partners broaden Nikola's executionalcapability, reduce time to market, and solidify Nikola's technological leadership. In addition, these leading suppliers and partners will also allow us to manufacture and deliver Nikola's productswith high quality standards. For example, Nikola's partnership with Iveco provides us with flexibility, scalability, and speed to market, while product design, supply chain management, and qualitycontrol are managed by Nikola's engineering team. Additionally, this partnership has allowed us to enter the European market in a capital efficient manner, and years earlier than we originallyanticipated. By entering into strategic partnerships, Nikola can reduce execution risk and increase speed to market, which provides a critical advantage as Nikola looks to execute upon our vision.

Leverage Hydrogen Station Dynamics to Transition Energy Future

        Nikola believes that the hydrogen station network, and the production and distribution of hydrogen, will provide a competitive advantage thatdrives sustained profitability and stockholder value over the long term. Nikola believes that hydrogen-powered Class 8 trucks will be the product of choice

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inthe medium- and long-haul markets. As OEMs begin to widely adopt hydrogen fuel cell technology, and there will be a greater need for hydrogen distribution along key transportation routes,Nikola will be in a strong position to be the leading provider of hydrogen to commercial transportation companies.By owning the world's leading hydrogen station network, we anticipate playing a major role in the energy transformation of the future.

Continued Focus on Technological Innovations

        Nikola intends to continue to attract top talent to further enhance Nikola's talent pool and drive technological innovations. Additionally,Nikola plans to further enhance its battery and fuel cell technology to achieve better performance and shorten charging and fueling time, while increasing the range of its product portfolio.

Future Market Opportunities

Autonomous Driving

        Nikola's trucks are designed with autonomous driving in mind, which may provide revenue to Nikola in the future as well as potential costsavings to customers. All Nikola products will be built with a space claim for an autonomous hardware suite. Given the nature of our dedicated route customers, operating point-to-point interstateroutes between our hydrogen stations, we believe Nikola's trucks provide the perfect testing environment for further development and advancement of autonomous technology. When the various regulatoryagencies have approved some level of autonomy, we will consider a partnership with one of the autonomous software leaders to deploy its technology on our vehicles.

        Autonomousdriving represents significant incremental revenue opportunities for Nikola as we could charge customers an additional fee for each mile driven autonomously. According to theU.S. Federal Motor Carrier Safety Association, in the U.S., truck drivers face total hours restrictions that do not allow them to operate their vehicles more than 11 hours a day. In the EU,drivers are generally restricted to 9 hours a day, according to the European Parliament. Autonomous driving will help achieve higher utilization by removing the limitations on how long a truckdriver can operate.

        Inaddition to the incremental revenue opportunity for Nikola and the potential cost savings available to fleet operators as a result of autonomous technology, we believe autonomy willsignificantly improve safety and asset utilization which would increase the revenue generating potential for both Nikola and our customers.

Energy Optimization

        The global energy mix is in transition with more than 60% of new capacity coming from renewable energy sources, based on the Global MarketOutlook for Solar Power provided by SolarPower Europe. The transition away from fossil fuel-based energy generation, such as coal, natural gas, etc., is beneficial to the environment, but is notwithout its challenges. As renewable energy makes up a greater share of the energy mix, daily energy production becomes more volatile, and the energy production curve becomes less predictable.

        Withfossil-fuel based energy, demand peaks are typically addressed by burning natural gas in turbine-based power plants. With renewable energy, one does not have similar control overenergy production, and instead the production curve is determined based on the daily solar cycle and weather patterns, which means daily energy production becomes more volatile. This increasedvolatility creates a distorted energy production curve, resulting in both predictable (e.g., the sun comes out every day) and unpredictable (e.g., the wind blows stronger on some dayscompared to others) surplus energy

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productioncapacity. This surplus energy typically goes unused, and in extreme cases must be traded away at zero or even negative revenue to the utility provider.

        Hydrogenproduction can be used to balance the grid by taking excess energy production and storing it for future use. Nikola can also help balance the grid by allowing utilities andpower providers to interrupt hydrogen station electricity consumption during peak demand. Nikola's ability to turn excess energy into hydrogen may offer operators and energy providers the ability toincrease revenue by selling us otherwise wasted off-peak generating capacity. Additionally, the ability to store unused energy in the form of hydrogen reduces the need for peak power generating plantsthat are typically costly to build and operate, and that historically are heavily underutilized. Instead, Nikola could potentially build excess hydrogen storage on-site, then sell excess hydrogen backto the grid during periods of peak demand.

Sales and Marketing

        Nikola takes an insight-driven, strategic approach to our go-to-market strategy. Across the product portfolio, Nikola is commissioning studies,conducting focus groups and gaining insight intended to focus sales and marketing efforts in a customer and partner-centric way and grounded on a foundation of zero-emissions.

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Research and Development

        Our research and development activities take place out of our headquarters facility in Phoenix, Arizona and at our development partners'facilities located around the world.

        Theprimary areas of focus for research and development include, but are not limited to:

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fuel cell;



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battery pack and battery management systems (BMS);



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vehicle controls;



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infotainment;



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e-Axle and inverter;



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energy storage; and



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hydrogen production, storage, and dispensing.

        Mostof our current activities are focused on the research and development of the Nikola Tre BEV/FCEV and Nikola Two FCEV truck platforms. We work closely with our partners, includingwithout limitation Iveco, Bosch, and AVL, to develop truck platforms and bring them to market.

        Wehave purchased equipment that will aid in the development, validation and testing of our powertrain, battery technology, and fuel cell technology. We expect our research anddevelopment expenses to increase for the foreseeable future as we continue to invest in research and development activities to expand our product offering for both the U.S. and the European markets.

Historical Revenue

        Our historical revenue is de minimis and relates exclusively to small scale solar installation projects. To date, these projects have beenperformed by two dedicated and licensed solar panel installation professionals in order for Nikola to gain general knowledge and expertise related to solar energy installation. Going forward, we donot expect these activities to generate meaningful revenue.

Intellectual Property

        Our success depends in part upon our ability to protect our core technology and intellectual property. We protect our intellectual propertyrights, both in the U.S. and abroad, through a combination of patent, trademark, copyright and trade secret protection, as well as confidentiality and invention assignment agreements with ouremployees and consultants. We seek to control access to, and distribution of, our proprietary information through non-disclosure agreements with our vendors and business partners. Unpatented research,development, know-how, and engineering skills make a vital contribution to our business, and we pursue patent protection when we believe it is possible and consistent with our overall strategy forsafeguarding intellectual property.

        Asof March 1, 2020, Nikola owns or co-owns 11 issued U.S. patents, 5 issued foreign patents and has 55 pending or allowed patent applications. In addition, Nikola has 32 pendingU.S. trademark applications and 32 pending foreign trademark applications. Nikola's patents and patent applications are directed to, among other things, vehicle and vehicle powertrain (includingbattery and fuel cell technology), hydrogen fueling, off-road vehicle, and personal watercraft technologies.

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Headquarters and Manufacturing Facility

        In June 2019, we moved into our state-of-the-art headquarters and R&D facility in Phoenix, Arizona, which consists of more than 150,000 squarefeet and where we are capable of designing, building, and testing prototype vehicles in-house.

        InJanuary 2019, we acquired an approximately 400-acre parcel of real property in Coolidge, Arizona, which is located about 50 miles south of Phoenix. The location of the parcel is wellsuited for a manufacturing facility due to the labor force in Pinal County and in nearby Phoenix, as well as the parcel's proximity to the Interstate 10 highway, the Interstate 8 highway, and arailway spur that abuts the parcel. In the second half of 2020, we plan to break ground on the initial phase of our 1 million square foot BEV and FCEV truck manufacturing plant. Construction ofthe manufacturing facility will be divided into two phases.

        Phase 1is expected to begin in the third quarter or 2020 through the fourth quarter of 2021 and will be for low volume production with estimated production capacity of 5,000units per year. Phase 2 of the construction is expected between the fourth quarter of 2021 and the fourth quarter of 2022, for purposes of high-volume production with estimated productioncapacity of 50,000 units per year.

Employees

        We pride ourselves on the quality of our lean and diverse team. We work to leverage partnerships and modulate hiring based on our productroadmap. As of March 2, 2020, we had 256 full-time employees based primarily in the greater Phoenix, Arizona area. A majority of our employees are engaged in research and development andrelated functions. We anticipate significant employee growth as we approach commercialization. Our targeted hires typically have significant experience working for well-respected original equipmentmanufacturers, automotive engineering firms and software companies. To date, we have not experienced any work stoppages and consider our relationship with our employees to be in good standing. None ofour employees are either represented by a labor union or subject to a collective bargaining agreement.

Government Regulation and Credits

        Nikola operates in an industry that is subject to extensive environmental regulation, which has become more stringent over time. The laws andregulations to which we are subject govern, among others, water use; air emissions; use of recycled materials; energy sources; the storage, handling, treatment, transportation and disposal ofhazardous materials; the protection of the environment, natural resources and endangered species; and the remediation of environmental contamination. We have been required to obtain and comply withthe terms and conditions of multiple environmental permits, many of which are difficult and costly to obtain and could be subject to legal challenges. Compliance with such laws and regulations at aninternational, regional, national, provincial and local level is an important aspect of our ability to continue our operations.

        Environmentalstandards applicable to Nikola are established by the laws and regulations of the countries in which Nikola operates, standards adopted by regulatory agencies and thepermits and licenses. Each of these sources is subject to periodic modifications and increasingly stringent requirements. Violations of these laws, regulations or permits and licenses may result insubstantial civil and criminal fines, penalties, and possibly orders to cease the violating operations or to conduct or pay for corrective works. In some instances, violations may also result in thesuspension or revocation of permits and licenses.

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Vehicle Safety and Testing Regulation

        Our vehicles are subject to, and comply with, numerous regulatory requirements established by the National Highway Traffic Safety Administration("NHTSA"), including applicable U.S. federal motor vehicle safety standards ("FMVSS"). As a manufacturer, we must self-certify that the vehicles meet or are exempt from all applicable FMVSSs before avehicle can be imported into or sold in the U.S.

        Thereare numerous FMVSSs that apply to our vehicles. Examples of these requirements include:

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Electronic Stability Control—performance and equipment requirements on heavy-dutyvehicles to reduce crashes caused by rollover or by directional loss-of-control;



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Air Brake Systems—performance and equipment requirements of air brake systems onheavy-duty vehicles to ensure safe braking performance under normal and emergency conditions;



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Electric Vehicle Safety—limitations on electrolyte spillage, battery retention, andavoidance of electric shock following specified crash tests;



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Flammability of Interior Materials—burn resistance requirements for materials usedin the occupant compartment; and



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Seat Belt Assemblies and Anchorages—performance and equipment requirements toprovide effective occupant protection by restraint and reducing the probability of failure.

        Thefollowing FMVSSs do not apply to our vehicle, but we are incorporating the applicable components of the standards for additional safetyperformance:

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Tire Pressure Monitoring System—performance requirements to warn the driver ofsignificant under-inflation of tires resulting in safety problems;



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Roof Crush Resistance—strength requirements for the occupant roof to preventcrushing of the roof into the occupant compartment in rollover crashes;



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Minimum Sound Requirements for Hybrid and Electric Vehicles—performancerequirements for sound to alert pedestrians that a commercial vehicle is in the immediate area; and



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Crash Tests for High-Voltage and Hydrogen Fuel System Integrity—preventing electricshock from high voltage systems and fires that result from fuel spillage during and after motor vehicle crashes.

        Inaddition to the FMVSS requirements for heavy-duty vehicles, Nikola also designs our vehicles to meet the requirements of the Federal Motor Carrier Safety Administration ("FMCSA"),which hasrequirements for the truck and fleet owners. We also design to meet the requirements set forth in the Federal Motor Carrier Safety Regulations ("FMCSR") pertaining to the safety of the driver duringoperation of the vehicle.

        Thereare numerous FMCSRs that apply to our vehicles. Examples of these requirements include:

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Step, Handhold and Deck Requirements—performance and equipment requirements toenhance the safety for entry, egress, and back of cab access of a heavy-duty vehicle.



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Auxiliary Lamps—performance and placement requirements for lamps in addition tolamps that meet the requirements of FMVSS 108 Lamps, Reflective Devices and Associated Equipment.



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Speedometer—performance and accuracy requirement for equipment indicating thevehicle speed. This includes both digital and analog displays.

        Weare also required to comply with other NHTSA requirements and federal laws administered by NHTSA, including early warning reporting requirements regarding warranty claims, fieldreports, death and injury reports, foreign recalls, and owner's manual requirements.

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        Thevehicles we will offer for sale in Europe are subject to United Nations Economic Commission Europe ("UNECE") safety testing regulations. Many of those regulations, referred to asEuropean Union Whole Vehicle Type Approval ("WVTA"), are different from the federal motor vehicle safety standards applicable in the U.S. and may require redesign and/or retesting. Our Nikola Tre BEVand Nikola Two vehicle currently meet specific NHTSA type approvals and we will commence with testing our vehicles for the WVTA to assure compliance with the UNECE requirements.

        Wehave found there are UNECE compliance requirements and UN Global Technical Regulations ("GTR") applicable to heavy-duty vehicles in Europe, which have not been developed forheavy-duty vehicles by NHTSA or FMCSA. We have implemented the UNECE standards for additional safety during driving operation. The following are some UNECE standards and GTRs applied to the Nikola Treand Nikola Two.

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Electromagnetic Compatibility & Interference—performance requirements forthe prevention and interference of electromagnetic radiation which may cause disturbances in the drivability of the vehicles and other vehicles in the area.



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Lane Departure Warning System—performance and testing requirements for a systemthat warns the driver of an unintentional drift of the vehicle out of its travel lane.



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Electric Vehicle Safety—performance and testing requirements for BEVs during in-useand post-crash.



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Hydrogen Fuel Cell Vehicle Safety—performance and testing requirements for hydrogenfuel cell vehicle during in-use and post-crash.

        TheNikola Tre and Nikola Two consist of many electronic and automated components and systems. Our vehicles are designed to comply with the International Standards Organization's("ISO"), Functional Safety Standard. This standard addresses the integration of electrical systems and software and identifies the possible hazards caused by malfunctioning behavior of thesafety-related electrical or electronic systems, including the interaction of these systems.

EPA Emissions & Certificate of Conformity

        The U.S. Clean Air Act requires that we obtain a Certificate of Conformity issued by the EPA and a California Executive Order issued by theCalifornia Air Resources Board ("CARB"), concerning emissions for our vehicles. A Certificate of Conformity is required for vehicles sold in states covered by the Clean Air Act's standards and anExecutive Order is required for vehicles sold in states that have sought and received a waiver from the EPA to utilize California standards. CARB sets the California standards for emissions controlfor certain regulated pollutants for new vehicles and engines sold in California. States that have adopted the California standards as approved by EPA also recognize the Executive Order for sales ofvehicles. There are currently four states which have adopted the California standard for heavy-duty vehicles.

        TheGreenhouse Gas Rule was incorporated into the Clean Air Act on August 9, 2011. Since our vehicles have zero-emissions, Nikola is required to seek an EPA Certificate ofConformity for the Greenhouse Gas Rule, and a CARB Executive Order for the CARB Greenhouse Gas Rule. We expect to receive the Certificate of Conformity followed by an Executive Order for sales of theNikola Tre in May 2021.

Battery Safety and Testing Regulation

        Our vehicles are designed to ISO standards for electrically-propelled vehicles in vehicle operational safety specifications and connecting to anexternal power supply. Additionally, we are incorporating other ISO battery system standards in our vehicles.

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        Someof these standards include:

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Conductive Charging—for on board charge electromagnetic requirements;



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Battery Pack Enclosure Protection—degrees of protection of the electrical equipmentwithin an enclosure from the effects due to the ingress of water; and



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Testing Lithium-ion Traction Battery Packs and Systems—safety performancerequirements during a variety of testing, like vibration, thermal cycling, overcharge, and loss of thermal control.

        Ourbattery pack conforms with mandatory regulations governing the transport of "dangerous goods," which includes lithium-ion batteries that may present a risk in transportation. Thegoverning regulations, which are issued by the Pipeline and Hazardous Materials Safety Administration ("PHMSA"), are based on the UN Recommendations on the Safe Transport of Dangerous Goods ModelRegulations, and related UN Manual Tests and Criteria. The regulations vary by mode of transportation when these items are shipped by ocean vessel, rail, truck, or by air.

        Weare designing our battery packs to meet the compliance requirements of the UN Manual of Tests and Criteria demonstrating our ability to ship the vehicles and battery packs by anymethod.

        Thesetests include:

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Altitude simulation—simulating air transport;



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Thermal cycling—assessing cell and battery seal integrity;



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Vibration—simulating vibration during transport;



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Shock—simulating possible impacts during transport;



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External short circuit—simulating an external short circuit; and



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Overcharge—evaluating the ability of a rechargeable battery to withstandovercharging.

        Thecells in our battery packs are composed mainly of lithium-ion.

        Inaddition, our battery packs include packaging for the lithium-ion cells. This packaging includes trace amounts of various hazardous chemicals whose use, storage and disposal isregulated under federal law.

Greenhouse Gas (GHG) Credits—U.S. Environmental Protection Agency

        In connection with the delivery and placement into service of our zero-emission vehicles under the Greenhouse Gas Rule, Nikola will earntradable credits that under current laws and regulations can be sold. Under the EPA's Greenhouse Gas Rule, each BEV earns a credit multiplier of 4.5 and each hydrogen fuel cell electric vehicle earnsa credit multiplier of 5.5 for use in the calculation of emission credits. Commercial vehicle manufacturers are required to ensure they meet the nitrogen oxide emission standard for each type ofvehicle produced. This emission standard continues to lower the emission requirement over time, increasing the difficulty for conventional diesel vehicles to meet the standard. Until technologycatches up for commercial vehicles, manufacturers of diesel trucks will need to purchase GHG credits to cover their emission deficit. The Greenhouse Gas Rule provides theopportunity for the sale of excess credits to other manufacturers who apply such credits to comply with these regulatory requirements. Furthermore, the regulation does not limit the number ofbattery-electric and hydrogen fuel cell credits sold within the same commercial vehicle categories.

Greenhouse Gas Credits—California Air Resources Board

        California also has a greenhouse gas emissions standard which follows very closely to the EPA Greenhouse Gas Emissions Standard. The deliveryand placement into service of our zero-emission

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vehiclesin California under the Greenhouse Gas Rule will earn Nikola tradable credits that can be sold. Under CARB greenhouse gas regulations, each BEV will also earn a credit multiplier of 4.5 andeach hydrogen fuel cell electric vehicle will earn a credit multiplier of 5.5 for use in the calculation of emission credits. Commercial vehicle manufacturers are required to ensure they meet thenitrogen oxide emission standard for each type of vehicle produced. This emission standard continues to lower the emission requirement over time, increasing the difficulty for conventional dieselvehicles to meet the standard.

        Untiltechnology catches up for commercial vehicles, manufacturers of diesel trucks will need to purchase GHG credits to cover their emission deficit. The California timeline forreaching very low GHG emissions is more aggressive than the EPA. Commercial vehicle manufacturers will look to cover their emission deficits first for California. The Greenhouse Gas Rule provides anopportunity for the sale of excess credits to other manufacturers who apply such credits to comply with these regulatory requirements. Furthermore, the regulation does not limit the number ofbattery-electric and hydrogen fuel cell credits sold within the same commercial vehicle categories.

        Examplesof other potential incentive and grant programs that either Nikola or its customers can apply for include:

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Low Carbon Fuel Standard—The Low Carbon Fuel Standard was initially developed inCalifornia and is quickly gaining traction in other jurisdictions around the world. The goal is to reduce the well-to-wheel carbon intensity of fuels by providing both mandated reduction targets aswell as tradeable/sellable credits.



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Purchase Incentives—Both California and New York have active programs that provide"cash on the hood" incentives to customers that purchase zero-emission vehicles. In California, the Hybrid and Zero-Emission Truck and Bus Voucher Incentive Project incentives reach as high as$165,000 for a Class 8 BEV and $315,000 for a Class 8 FCEV, and for the New York Truck Voucher Incentive Program NYTVIP, as high as $185,000 for a Class 8 BEV. Other states areconsidering developing similar programs.



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Grant Programs—Government entities at all levels from federal, including DOE,state, (for example, CARB), local (for example, North Texas Council of Governments), have grant programs designed to increase and accelerate the development and deployment of zero-emission vehiclesand infrastructure technologies.

Strategic Collaborations

Commercial Letter with Nimbus

        On March 2, 2020, Legacy Nikola entered into a Commercial Letter Agreement with Nimbus (the "First Nimbus Commercial Letter Agreement").Under the First Nimbus Commercial Letter Agreement, Nikola may select an autonomous driving software and hardware package to be used on Nikola's trucks from any company, but Nikola agreed to useNimbus' affiliates' autonomous driving components on Nikola's autonomy-equipped trucks, subject to certain pricing, quality, functionality, reliability deliverability and availability conditions.

        Pursuantto the First Nimbus Commercial Letter Agreement, Nikola is obligated to receive a quantity of services, including inverter and fuel cell power module development and systemintegration services, that result in a minimum payment to Nimbus and its affiliates. Nikola also agreed to negotiate in good faith toward a supply agreement with Nimbus, or an affiliate of Nimbus, forinverter development, fuel cell power module development and part supply. Nimbus agreed to abide by certain product specifications, delivery timelines, production quantities, efficiencies, pricing andprototypes within 30 days of receipt of a project proposal form Nikola, after which time, Nikola may source inverters from other suppliers.

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European Alliance Agreement with CNHI/Iveco

        On February 28, 2020, Legacy Nikola entered into the Amended and Restated European Alliance Agreement with Iveco and, solely with respectto sections 9.5 and 16.18, CNHI (the "European Alliance Agreement"), whereby Nikola and CNHI/Iveco agreed to establish an entity for the purposes of developing and manufacturingbattery-electric and hydrogen fuel cell electric heavy trucks in Europe. Pursuant to the European Alliance Agreement, Nikola and Iveco will contribute equal amounts of cash and in kind contributionsnecessary for each party to subscribe to 50% of the capital stock of the entity contemplated by the agreement, and the entity will be funded in accordance with the business plan through thecontributions made by each party. CNHI shall also have the right to negotiate a license to use certain of Nikola's intellectual property in Europe for applications outside the entity.

        Suchentity, Nikola Iveco Europe B.V. ("Nikola Iveco JV"), was established in April 2020. On April 9, 2020, a series of agreements was entered into among Legacy Nikola,Iveco and Nikola Iveco JV, including an Iveco Technology License Agreement, a Nikola Technology License Agreement, a European Supply Agreement and a North America Supply Agreement. Under the IvecoTechnology License Agreement, Iveco granted Nikola Iveco JV a nonexclusive, royalty-free license under Iveco IP to deploy, through the term of the European Alliance Agreement, battery-electricheavy-duty trucks ("BEV") and hydrogen heavy-duty trucks ("FCEV") in Europe. Under the Nikola Technology License Agreement, Nikola granted Nikola Iveco JV a nonexclusive, royalty-bearing license underNikola intellectual property to deploy, through the term of the European Alliance Agreement, BEVs and FCEVs in Europe.

        Underthe European Supply Agreement, Nikola Iveco JV was granted certain exclusive rights by Iveco to produce and supply BEVs and FCEVs to Iveco in Europe, and under the North AmericanSupply Agreement, Nikola Iveco JV was granted certain exclusive rights by Nikola to produce and supplyBEVs and FCEVs to Nikola in North America. The European Supply Agreement runs concurrent with the term of the European Alliance Agreement. The North America Supply Agreement terminates upon theearlier of December 31, 2024 or the occurrence of certain other events, including two years following the date Nikola begins manufacturing BEVs and FCEVs in North America.

        Theinitial term of the European Alliance Agreement expires on December 31, 2030, with automatic renewals of ten-year periods unless terminated by either party with written noticereceived by the non-terminating party no later than December 31, 2029 for the initial term and no later than the end of the 7th year of any subsequent term.

CNHI Services Agreement with CNHI/Iveco

        On September 3, 2019, Legacy Nikola entered into the CNHI Services Agreement with CNHI and Iveco in conjunction with Legacy Nikola'sSeries D preferred stock financing. Under this agreement, Nikola issued to Iveco 13,498,921 shares of Series D preferred stock in exchange for a license valued at $50.0 millionpursuant to an S-WAY Platform and Product Sharing Agreement, $100.0 million in-kind services, pursuant to a Technical Assistance Service Agreement (the "Technical Assistance Service Agreement")and $100.0 million in cash. The CNHI Services Agreement may be terminated by mutual agreement of the parties, or at the election of a non-breaching party upon the breach by the other of theCNHI Services Agreement, the S-WAY Platform Product Sharing Agreement, or the Technical Assistance Service Agreement if such breach has not been cured within thirty days of receipt of written notice.The CNHI Services Agreement may be also be terminated upon bankruptcy or insolvency proceedings against Nikola or CNHI/Iveco. Under the S-WAY Platform and Product Sharing Agreement, Nikola was granteda nonexclusive license to Iveco's intellectual property, technology and designs related to its latest European heavy-duty truck platform (the "S-WAY"). The license does not contain any power trainrelated components, as we plan to use our proprietary electric drive system, but does include access to the semi-articulated and articulated versions of the S-WAY in the 4x2, 6x2

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and6x4 variants. The license also gives Nikola access to Iveco's parts and suppliers list related to the S-WAY and bears a seven-year royalty from the start of production of 1.25% on FCEVs and 1.00%on BEVs that incorporate a material portion of such licensed technology. This license agreement will continue in effect until terminated by mutual agreement of the parties, a non-curable breach hasoccurred or a bankruptcy related event of either party.

Master Agreement with Anheuser-Busch

        On February 22, 2018, Legacy Nikola entered into the Master Agreement—Tractors with AB (the "Master Agreement") whereby ABagreed to lease from Nikola hydrogen fueled tractors and related equipment to be used by AB for transportation and related services at certain AB locations. Pursuant to the Master Agreement, Nikolawill provide maintenance and repairs for the leased equipment. The term of the Master Agreement commenced January 1, 2018, and remains available to cover future leases between the partiesunless terminated by either party if either party defaults and fails to cure such default within thirty days, or unless terminated by AB with three hundred sixty days prior written notice to Nikola.

Supply Agreement with Nel

        On June 28, 2018, Legacy Nikola entered into the Supply Agreement for electrolyzers with Nel (the "Supply Agreement") whereby Nikolaagreed to purchase electrolyzers from Nel. Pursuant to the Supply Agreement, Nikola will source electrolyzers exclusively from Nel in connection with the development and implementation ofhydrogen-dispensing stations. Nikola's obligation to source electrolyzers from Nel expires on the date upon which enough electrolyzers have been ordered to produce a specified amount of hydrogen perday; the terms of the Supply Agreement remain in effect for five years following that date, unless terminated for default by either party (with such default subject to cure within sixty days).

Commercial Framework Agreement with Green Nikola Holdings

        On November 9, 2018, Legacy Nikola entered into the Commercial Framework Agreement with Green Nikola Holdings LLC ("GNH") (the"Framework Agreement") in connection with GNH's subscription for and purchase of Nikola shares. Pursuant to the Framework Agreement, GNH agreed to provide services to Nikola and Nikola agreed to makecertain commitments to GNH ("Projects") pursuant to statements of work. The Framework Agreement is in effect until the expiration or termination of all Projects, or GNH reducing its equity position inNikola below 50% percent of the number of shares acquired in November 2018. The Framework Agreement may be terminated by either party for cause (with thirty days to cure such breach), bankruptcy, orGNH may terminate the Framework Agreement if Nikola fails to render any payment due to GNH for more than sixty days or undergoes a change of control without the prior written consent of GNH.

Legal Proceedings

        From time to time, we may become involved in additional legal proceedings arising in the ordinary course of our business. We are currently not aparty to any legal proceedings the outcome of which, if determined adversely to us, would individually or in the aggregate have a material adverse effect on our business, financial condition, andresults of operations.

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MANAGEMENT

Executive Officers and Directors

        Nikola's directors and executive officers and their ages as of July 1, 2020 are as follows:

Executive Officers

        Trevor R. Milton.    Mr. Milton has served as Nikola's Executive Chairman since June 2020. Mr. Milton is the founder ofLegacy Nikola, andserved as its Chief Executive Officer from January 2014 to June 2020 and as Chairman of Legacy Nikola's board of directors from July 2017 to June 2020. We believe Mr. Milton is qualified toserve on the Board due to his experience serving as Legacy Nikola's Chief Executive Officer, President and Chairman of Legacy Nikola's board of directors.

        Mark A. Russell.    Mr. Russell has served as Nikola's President and Chief Executive Officer and a member of the Board sinceJune 2020. Prior tothat, Mr. Russell served as Mr. Russell has served as Legacy Nikola's President from February 2019 to June 2020 and as a member Legacy Nikola's board of directors from July 2019 to June2020. From August 2018 to February 2019, Mr. Russell explored new opportunities. Prior to that, Mr. Russell served as President and Chief Operating Officer of Worthington Industries(NYSE: WOR) from August 2012 to August 2018. Mr. Russell received a B.I.S. in integrated studies from Weber State University and a juris doctor from Brigham Young University. We believeMr. Russell is qualified to serve on the Board due to his extensive leadership and management experience at various public and private companies, including his experience serving as LegacyNikola's President.

        Kim J. Brady.    Mr. Brady has served as Nikola's Chief Financial Officer since June 2020, and prior to that, served as ChiefFinancial Officerand Treasurer of Legacy Nikola from November 2017 to June 2020. Prior to joining Legacy Nikola, Mr. Brady served as senior managing director and partner of Solic Capital Management, LLC,a middle market financial advisory and principal investment firm, from 2012 to October 2017. Mr. Brady was co-head of Solic's Special Situations Fund that invested across all levels of capitalstructure. Mr. Brady received a bachelor's of science in management, finance

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andaccounting from Brigham Young University and an MBA from Northwestern University's Kellogg Graduate School of Management.

        Joseph R. Pike.    Mr. Pike has served as Nikola's Chief Human Resources Officer since June 2020, and prior to that, served asLegacy Nikola'sChief Human Resources Officer from January 2018 to June 2020. Prior to joining Legacy Nikola, Mr. Pike served in various human resources positions at Vista Outdoor Inc., an outdoorsports and recreational products company, including as senior director of talent and as director of leadership and organizational development from June 2015 to January 2018. At H.J. Heinz Company, afood processing company which is now a part of Kraft Heinz Co (Nasdaq: KHC), Mr. Pike served in various capacities from March 2013 to June 2015, including as human resources business partner,head of talent management and organizational effectiveness and associate director of performance. Mr. Pike received a bachelor's degree in communications from Brigham Young University and amaster's degree in public administration from the Brigham Young University Marriott School of Management.

        Britton M. Worthen.    Mr. Worthen has served as Nikola's Chief Legal Officer and Secretary since June 2020, and prior to that, served as LegacyNikola's Chief Legal Officer and Secretary from October 2015 to June 2020. Prior to joining Nikola, Mr. Worthen was a partner at Beus Gilbert McGroder PLLC, a law firm, from May 2000 toSeptember 2015. Mr. Worthen received a bachelor's degree in Asian studies from Brigham Young University and a juris doctor from Michigan Law School.

Non-Employee Directors

        Stephen J. Girsky.    Mr. Girsky served as VectoIQ's President, Chief Executive Officer and a director from January 2018 toJune 2020, andcontinues to serve on the Board following the completion of the Business Combination. Mr. Girsky is a Managing Partner of VectoIQ, LLC, an independent advisory firm based in New York.Mr. Girsky has more than 30 years of experience working with corporate board executives, labor leaders, OEM leaders, suppliers, dealers and national policy makers. Mr. Girskyserved in a number of capacities at General Motors Company (NYSE: GM) ("General Motors") from November 2009 until July 2014, including vice chairman, having responsibility for global corporatestrategy, new business development, global product planning and program management, global connected consumer/OnStar, and GM Ventures LLC, global research & development and globalpurchasing and supply chain. Mr. Girsky also served on General Motors' board of directors following its emergence from bankruptcy in June 2009 until June 2016. Mr. Girsky currentlyserves on the boards of directors of United States Steel Corporation (NYSE: X), a steel producer, and Brookfield Business Partners Limited, the general partner of Brookfield BusinessPartners, L.P. (NYSE: BBU; TSX BBU.UN), a private equity company. Mr. Girsky received a bachelor's of science in mathematics fromthe University of California, Los Angeles and an MBA from Harvard University. We believe Mr. Girsky is qualified to serve on the Board based on his extensive leadership and business experience,including his experience as a director of numerous public companies, together with his background in finance and public company governance.

        Sooyean (Sophia) Jin.    Ms. Jin has served as a member of the Board since June 2020, and prior to that, a member of LegacyNikola's board ofdirectors from May 2019 to June 2020. Ms. Jin has served as senior director of venture investments of Hanwha Holdings, a stage-agnostic investor representing Hanwha Corporation, since January2019, and served as director of venture investment of Hanwha Holdings from January 2018 to December 2018. Prior to that, Ms. Jin held various positions at Hanwha Q CELLS America Inc., aglobal solar cell and module manufacturer, including director of corporate planning from July 2013 to June 2015 and director of head of marketing from July 2015 to December 2017. Ms. Jinreceived a bachelor's in business administration from Seoul National University and an MBA from the Stanford University Graduate School of Business. We believe Ms. Jin is qualified to serve onthe Board due to her extensive experience with renewable energy companies.

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        Michael L. Mansuetti.    Mr. Mansuetti has served as a member of the Board since June 2020, and prior to that, a member ofLegacy Nikola's boardof directors from September 2019 to June 2020. Since July 2012, Mr. Mansuetti has been the President of Robert Bosch LLC, an automotive component supply company. Mr. Mansuettireceived a bachelor's of science in mechanical engineering from Clemson University. We believe Mr. Mansuetti is qualified to serve on the Board due to his expertise in advanced manufacturing,operations, and management and extensive leadership experience.

        Gerrit A. Marx.    Mr. Marx has served as a member of the Board since June 2020, and prior to that, a member of LegacyNikola's board ofdirectors from September 2019 to June 2020. Mr. Marx has served as Chief Executive Officer of Iveco, a commercial goods manufacturing company, since March 2019 and as President of commercialand specialty vehicles of CNHI (Nasdaq: CNHI), an industrial goods manufacturing company, since January 2019. Prior to joining CNHI, Mr. Marx served as an operating partner Bain Capital, aglobal private equity firm, from December 2012 to December 2018. Mr. Marx served as interim Chief Executive Officer of Wittur Holding GmbH, an elevator component manufacturing company,from May 2017 to March 2018 and as interim President of power tools of Apex Tool Group, LLC, a hand and power tool manufacturing company, from November 2014 to April 2015. Mr. Marxreceived a master's of engineering equivalent in mechanical engineering and an MBA equivalent from RWTH Aachen University, Germany, and a doctorate in business administration fromCologne University, Germany. We believe Mr. Marx is qualified to serve on the Board due to his extensive experience in the automobile industry as well has his experience in finance.

        Lonnie R. Stalsberg.    Mr. Stalsberg has served as a member of the Board since June 2020, and prior to that, a member ofLegacy Nikola's boardof directors from July 2017 to June 2020. Since 1980, Mr. Stalsberg has served as President and Chief Executive Officer or ACE Recycle and Disposal, Inc., a waste management company.Mr. Stalsberg received a bachelor's of science in civil engineering from Washington State University. We believe Mr. Stalsberg is qualified to serve on the Board due to his leadershipand business experience.

        DeWitt C. Thompson, V.    Mr. Thompson has served as a member of the Board since June 2020, and prior to that, a member ofLegacy Nikola's boardof directors from July 2017 to June 2020. Mr. Thompson is Chairman and Chief Executive Officer of Thompson Machinery Commerce Corporation, a Caterpillar distributor in Tennessee andMississippi, servicing heavy machinery, on-highway trucks, and power systems. He also serves as Chairman for Aries Clean Energy. Mr. Thompson founded PureSafety in 1999 and served as Chairmanuntil the purchase of that company by Underwriters Laboratories in 2011. Mr. Thompson is also an owner and director of the Nashville Predators and sits on the board of directors for WealthAccess. He received his bachelor's of science degree from the engineering school at Vanderbilt University. We believe Mr. Thompson is qualified to serve on the Board due to his extensiveexperience in renewable energy and machinery.

        Jeffrey W. Ubben.    Mr. Ubben has served as a member of the Board since June 2020, and prior to that, a member of LegacyNikola's board ofdirectors from September 2019 to June 2020. In 2000, Mr. Ubben founded ValueAct Capital Management, L.P., a financial services company, where he has served as chairman. Mr. Ubbenhas served as a member of the boards of directors of numerous public and private companies, including The AES Corporation (NYSE: AES), an electrical power distribution company, since January 2018,Twenty-First Century Fox, Inc. (Nasdaq: TFCF and TFCFA), a multinational mass media corporation which was acquired by Walt Disney Co (NYSE: DIS) in March 2019, from November 2015 to April 2018,Willis Towers Watson plc (NYSE: WSH), a multinational risk management, insurance brokerage and advisory company ("Willis Towers"), from January 2016 to November 2017, Willis GroupHolding plc, a subsidiary of Willis Towers, from July 2013 to January 2016 and Bausch Health Companies Inc. (NYSE: BHC), a pharmaceutical company, from October 2014 to August 2015.Mr. Ubben has a B.A. in economics and political science from Duke University and an MBA from the Kellogg School of Management at Northwestern University. We believe

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Mr. Ubbenis qualified to serve on the Board due to his extensive background in finance and experience with numerous public company boards.

Board Composition

        Nikola's business and affairs are organized under the direction of the Board. The Board consists of nine members. Trevor R. Milton serves asExecutive Chairman of the Board. The primary responsibilities of the Board are to provide oversight, strategic guidance, counseling, and direction to Nikola's management. The Board will meet on aregular basis and additionally as required.

        Inaccordance with the terms of the Bylaws, the Board is divided into three classes, Class I, Class II, and Class III, with members of each class serving staggeredthree-year terms; provided, however, that commencing with the 2030 annual meeting of stockholders, the classification of the Board shall cease, and all directors shall be elected for terms expiring atthe next succeeding annual meeting of stockholders. The Board is divided into the following classes:

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Class I, which consists of Stephen J. Girsky, Michael L. Mansuetti and DeWitt C. Thompson, V, whose terms will expire at Nikola's annualmeeting of stockholders in 2021;



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Class II, which consists of Sophia Jin, Lonnie R. Stalsberg and Jeffrey W. Ubben, whose terms will expire at Nikola's annual meeting ofstockholders in 2022; and



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Class III, which consists of Gerrit A. Marx, Trevor R. Milton and Mark A. Russell, whose terms will expire at Nikola's annual meeting ofstockholders in 2023.

        Ateach annual meeting of stockholders to be held after the initial classification, the successors to directors whose terms then expire will be elected to serve from the time of electionand qualification until the third annual meeting following their election and until their successors are duly elected and qualified. This classification of the Board may have the effect of delaying orpreventing changes in Nikola's control or management. Nikola's directors may be removed for cause by the affirmative vote of the holders of at least a majority of Nikola's voting stock.

Director Independence

        The Board determined that each the directors on the Board, other than Trevor R. Milton and Mark A. Russell, qualify as independent directors, asdefined under the listing rules of Nasdaq (the "Nasdaq listing rules"), and the Board consists of a majority of "independent directors," as defined under the rules of the SEC and the Nasdaq listingrules relating to director independence requirements. In addition, Nikola is subject to the rules of the SEC and the Nasdaq relating to the membership, qualifications, and operations of the auditcommittee, as discussed below.

Role of the Board in Risk Oversight/Risk Committee

        One of the key functions of the Board is informed oversight of Nikola's risk management process. The Board does not have a standing riskmanagement committee, but rather administers this oversight function directly through the Board as a whole, as well as through various standing committees of the Board that address risks inherent intheir respective areas of oversight. In particular, the Board is responsible for monitoring and assessing strategic risk exposure and the audit committee has the responsibility to consider and discussNikola's major financial risk exposures and the steps its management will take to monitor and control such exposures, including guidelines and policies to govern the process by which risk assessmentand management is undertaken. The audit committee also monitors compliance with legal and regulatory requirements. Our compensation committee also assess and monitor whether our compensation plans,policies and programs comply with applicable legal and regulatory requirements.

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Board Committees

        In connection with the Closing, the Board established an audit committee, a compensation committee, and a nominating and corporate governancecommittee and adopted a charter for each of these committees, which complies with the applicable requirements of the Nasdaq listing rules. We intend to comply with future requirements to the extentthey will be applicable to us. Copies of the charters for each committee are available on the investor relations portion of Nikola's website.

Audit Committee

        Our audit committee consists of Stephen J. Girsky, Sophia Jin and Michael L. Mansuetti. The Board has determined that each of the members of theaudit committee satisfies the independence requirements of Nasdaq and Rule 10A-3 under the Exchange Act. Each member of the audit committee can read and understand fundamental financialstatements in accordance with Nasdaq audit committee requirements. In arriving at this determination, the Board examined each audit committee member's scope of experience and the nature of their priorand/or current employment.

        Mr. Girskyserves as the chair of the audit committee. The Board determined that Mr. Girsky qualifies as an audit committee financial expert within the meaning of SECregulations and meets the financial sophistication requirements of the Nasdaq listing rules. In making this determination, the Board considered Mr. Girsky's formal education and previousexperience in financial roles. Both Nikola's independent registered public accounting firm and management periodically will meet privately with our audit committee.

        Thefunctions of this committee include, among other things:

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evaluating the performance, independence and qualifications of Nikola's independent auditors and determining whether to retain Nikola'sexisting independent auditors or engage new independent auditors;



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reviewing Nikola's financial reporting processes and disclosure controls;



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reviewing and approving the engagement of Nikola's independent auditors to perform audit services and any permissible non-audit services;



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reviewing the adequacy and effectiveness of Nikola's internal control policies and procedures, including the effectiveness of Nikola's internalaudit function;



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reviewing with the independent auditors the annual audit plan, including the scope of audit activities and all critical accounting policies andpractices to be used by Nikola;



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obtaining and reviewing at least annually a report by Nikola's independent auditors describing the independent auditors' internal qualitycontrol procedures and any material issues raised by the most recent internal quality-control review;



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monitoring the rotation of Nikola's independent auditor's lead audit and concurring partners and the rotation of other audit partners asrequired by law;



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prior to engagement of any independent auditor, and at least annually thereafter, reviewing relationships that may reasonably be thought tobear on their independence, and assessing and otherwise taking the appropriate action to oversee the independence of Nikola's independent auditor;



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reviewing Nikola's annual and quarterly financial statements and reports, including the disclosures contained in the section entitled"Management's Discussion and Analysis of Financial Condition and Results of Operations," and discussing the statements and reports with Nikola'sindependent auditors and management;

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reviewing with Nikola's independent auditors and management significant issues that arise regarding accounting principles and financialstatement presentation and matters concerning the scope, adequacy, and effectiveness of Nikola's financial controls and critical accounting policies;



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reviewing with management and our auditors any earnings announcements and other public announcements regarding material developments;



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establishing procedures for the receipt, retention and treatment of complaints received by Nikola regarding accounting, internal accountingcontrols, auditing or other matters;



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preparing the report that the SEC requires in Nikola's annual proxy statement;



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reviewing and providing oversight of any related party transactions in accordance with Nikola's related party transaction policy and reviewingand monitoring compliance with legal and regulatory responsibilities, including Nikola's code of ethics;



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reviewing Nikola's major financial risk exposures, including the guidelines and policies to govern the process by which risk assessment andrisk management is implemented; and



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reviewing and evaluating the audit committee charter biennially and recommending any proposed changes to the Board.

        Thecomposition and function of the audit committee complies with all applicable requirements of the Sarbanes-Oxley Act and all applicable SEC rules and regulations. Nikola will complywith future requirements to the extent they become applicable to Nikola.

Compensation Committee

        Our compensation committee consists of Gerrit A. Marx, DeWitt C. Thompson, V and Lonnie R. Stalsberg. Mr. Marx serves as the chair of thecompensation committee. The Board has determined that each of the members of the compensation committee is a non-employee director, as defined in Rule 16b-3 promulgated under the Exchange Actand satisfies the independence requirements of Nasdaq. The functions of the committee include, among other things:

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reviewing and approving the corporate objectives that pertain to the determination of executive compensation;



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reviewing and approving the compensation and other terms of employment of Nikola's executive officers;



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reviewing and approving performance goals and objectives relevant to the compensation of Nikola's executive officers and assessing theirperformance against these goals and objectives;



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making recommendations to the Board regarding the adoption or amendment of equity and cash incentive plans and approving amendments to suchplans to the extent authorized by the Board;



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reviewing and making recommendations to the Board regarding the type and amount of compensation to be paid or awarded to Nikola's non-employeeboard members;



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reviewing and assessing the independence of compensation consultants, legal counsel and other advisors as required by Section 10C of theExchange Act;



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administering Nikola's equity incentive plans, to the extent such authority is delegated by the Board;



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reviewing and approving the terms of any employment agreements, severance arrangements, change in control protections and any othercompensation, perquisites and special or supplemental benefits for Nikola's executive officers;

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reviewing with management Nikola's disclosures under the caption "Compensation Discussion and Analysis" in Nikola periodic reports or proxystatements to be filed with the SEC, to the extent such caption is included in any such report or proxy statement;



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preparing an annual report on executive compensation that the SEC requires in Nikola's annual proxy statement; and



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reviewing and evaluating the compensation committee charter biennially and recommending any proposed changes to the Board.

        Thecomposition and function of our compensation committee complies with all applicable requirements of the Sarbanes-Oxley Act and all applicable SEC and Nasdaq rules and regulations.Nikola will comply with future requirements to the extent they become applicable to Nikola.

Nominating and Corporate Governance Committee

        Our nominating and corporate governance committee consists of Jeffrey W. Ubben, Stephen J. Girsky and Gerrit A. Marx. The Board has determinedthat each of the members of our nominating and corporate governance committee satisfies the independence requirements of Nasdaq. Mr. Ubben serves as the chair of our nominating and corporategovernance committee. The functions of this committee include, among other things:

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identifying, reviewing and making recommendations of candidates to serve on the Board;



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evaluating the performance of the Board, committees of the Board and individual directors and determining whether continued service on theBoard is appropriate;



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evaluating nominations by stockholders of candidates for election to the Board;



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evaluating the current size, composition and organization of the Board and its committees and making recommendations to the Board forapprovals;



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developing a set of corporate governance policies and principles and recommending to the Board any changes to such policies and principles;



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reviewing issues and developments related to corporate governance and identifying and bringing to the attention of the Board current andemerging corporate governance trends; and



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reviewing periodically the nominating and corporate governance committee charter, structure and membership requirements and recommending anyproposed changes to the Board.

        Thecomposition and function of the nominating and corporate governance committee complies with all applicable requirements of the Sarbanes-Oxley Act and all applicable SEC and Nasdaqrules and regulations. Nikola will comply with future requirements to the extent they become applicable to us.

Compensation Committee Interlocks and Insider Participation

        None of the members of our compensation committee has ever been an executive officer or employee of Nikola. None of our executive officerscurrently serve, or has served during the last completed fiscal year, on the compensation committee or board of directors of any other entity that has one or more executive officers that serves as amember of the Board or our compensation committee.

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Limitation on Liability and Indemnification of Directors and Officers

        The Certificate of Incorporation limits our directors' liability to the fullest extent permitted under the DGCL. The DGCL provides thatdirectors of a corporation will not be personally liable for monetary damages for breach of their fiduciary duties as directors, except for liability:

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for any transaction from which the director derives an improper personal benefit;



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for any act or omission not in good faith or that involves intentional misconduct or a knowing violation of law;



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for any unlawful payment of dividends or redemption of shares; or



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for any breach of a director's duty of loyalty to the corporation or its stockholders.



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If the DGCL is amended to authorize corporate action further eliminating or limiting the personal liability of directors, then the liability ofNikola's directors will be eliminated or limited to the fullest extent permitted by the DGCL, as so amended.

        Delawarelaw and the Bylaws provide that Nikola will, in certain situations, indemnify its directors and officers and may indemnify other employees and other agents, to the fullestextent permitted by law. Any indemnified person is also entitled, subject to certain limitations, to advancement, direct payment, or reimbursement of reasonable expenses (including attorneys' fees anddisbursements) in advance of the final disposition of the proceeding.

        Inaddition, Nikola entered into separate indemnification agreements with its directors and officers. These agreements, among other things, require Nikola to indemnify its directors andofficers for certain expenses, including attorneys' fees, judgments, fines, and settlement amounts incurred by a director or officer in any action or proceeding arising out of their services as one ofNikola's directors or officers or any other company or enterprise to which the person provides services at Nikola's request.

        Nikolamaintains a directors' and officers' insurance policy pursuant to which its directors and officers are insured against liability for actions taken in their capacities as directorsand officers. We believe these provisions in the Certificate of Incorporation and Bylaws and these indemnification agreements are necessary to attract and retain qualified persons as directors andofficers.

        Insofaras indemnification for liabilities arising under the Securities Act may be permitted to directors, officers or persons controlling the registrant pursuant to the foregoingprovisions, the registrant has been informed that in the opinion of the SEC such indemnification is against public policy as expressed in the Act and is therefore unenforceable.

Code of Business Conduct and Ethics and Code of Ethics for Senior Financial Officers

        The Board adopted a Code of Business Conduct and Ethics (the "Code of Conduct") applicable to all of our employees, executive officers anddirectors. The Board also adopted a Code of Ethics for Senior Financial Officers (the "Code of Ethics") applicable to our principal executive officer, principal financial officer, principal accountingofficer or controller or person performing similar functions identified by the Board and other key management employees. The Code of Conduct is available on Nikola's website at www.nikolamotor.com.Information contained on or accessible through Nikola's website is not a part of this registration statement, and the inclusion of Nikola's website address in this registration statement is aninactive textual reference only. The audit committee of the Board is responsible for overseeing the Code of Conduct and the Code of Ethics and must approve any waivers of the Code of Conduct foremployees, executive officers and directors and the Code of Ethics for senior financial officers. We expect that any amendments to the Code of Conduct and Code of Ethics, or any waivers of theirrequirements, will be disclosed on our website.

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Director Compensation

        The Board designed the Company's non-employee director compensation program to reward directors for their contributions to the Company'ssuccess, align the director compensation program with stockholder interests and the Company's executive compensation program, and provide competitive compensation necessary to attract and retain highquality non-employee directors. The Board expects to review director compensation periodically to ensure that director compensation remains competitive such that the Company is able to recruit andretain qualified directors.

        Underthe non-employee director compensation program, the Company will reward directors entirely in the form of stock-based compensation, consisting of (i) for each non-employeedirector, an annual grant of a restricted stock unit award ("RSUs") under the Nikola Corporation 2020 Stock Incentive Plan (the "2020 Plan") for shares of Common Stock having a grant date fair marketvalue of $200,000, to vest in full on the first anniversary of such grant date, subject to continued service through such vesting date and (ii) for the chair of each of the committees, anannual grant of RSUs with a value of $10,000, to vest in full on the first anniversary of such grant date, subject to continued service through such vesting date.

        Theinitial grant of such RSUs will be subject to approval by the Board as soon as practicable following the effective registration of the securities under the 2020 Plan on aRegistration Statement on Form S-8. The calculation of the number of shares subject to the initial RSUs will be based upon an assumed value on the date of grant of $10.00 per share, and theRSUs will vest in full on the first anniversary of the Closing Date, subject to continued service through such vesting date.

        Subjectto Board approval as soon as practicable following the effective registration of the securities under the 2020 Plan on a Registration Statement on Form S-8, subsequentgrants of RSUs under the non-employee director compensation program will be automatically granted, on the next business day following the annual meeting of stockholders of the Company, commencing withthe annual meeting of stockholders of the Company to be held in 2021. The calculation of the number of shares subject to such annual RSU grant will be based upon the average closing stock price ofCommon Stock over the 21-trading days prior to the grant date.

        Compensationunder the director compensation program will be subject to the annual limits on non-employee director compensation set forth in the 2020 Plan. In addition, each equity awardgranted to the eligible directors under the director compensation program will vest in full immediately prior to the occurrence of a change in control (as defined in the 2020 Plan) to the extentoutstanding at such time, subject to continued service through the closing of such change in control.

        TheCompany's policy is to reimburse directors for reasonable and necessary out-of-pocket expenses incurred in attending board and committee meetings or performing other services intheir capacities as directors. The Company does not provide tax gross-up payments to members of the Board.

Director Nominations

        Our nominating and corporate governance committee recommends to the Board candidates for nomination for election at the annual meeting of thestockholders. The Bylaws also establish advance notice procedures with respect to the nomination of candidates for election as directors, other than nominations made by or at the direction of theBoard or a committee of the Board. In order for a shareholder nomination to be "properly brought" before a meeting, a stockholder will have to comply with advance notice requirements and provide uswith certain information. Generally, to be timely, a stockholder's notice must be received at our principal executive offices not less than 90 days nor more than 120 days prior to thefirst anniversary date of the immediately preceding annual meeting of

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stockholders.The Bylaws also specify requirements as to the form and content of a stockholder's notice.

        Wehave not formally established any specific, minimum qualifications that must be met or skills that are necessary for directors to possess. In general, in identifying and evaluatingnominees for director, the Board of directors considers character, integrity, judgment, leadership, diversity of backgrounds, age, gender, ethnicity, independence, skills, education, expertise,business acumen, professional experience, knowledge of or experience in the industry in which the Company operates in, understanding of the Company's business, the ability of the candidate to devotesufficient time and attention to the affairs of the Company, and the extent to which a particular candidate would fill a present or anticipated need on the Board.

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EXECUTIVE COMPENSATION

        To achieve Nikola's goals, we have designed, and intend to modify as necessary, our compensation and benefits program to attract, retain,incentivize and reward deeply talented and qualified executives who share our philosophy and desire to work towards achieving these goals.

        Webelieve our compensation program should promote the success of the company and align executive incentives with the long-term interests of our stockholders. Legacy Nikola'scompensation programs reflected its startup origins in that they consist primarily of salary and stock option awards. As we evolve, we intend to continue to evaluate our philosophy and compensationprograms as circumstances require.

        Thissection provides an overview of our executive compensation programs, including a narrative description of the material factors necessary to understand the information disclosed inthe summary compensation table below.

        LegacyNikola's board of directors, with input from the Chief Executive Officer, has historically determined the compensation for Nikola's named executive officers. For the year endedDecember 31, 2019, Nikola's named executive officers were:

•

Trevor R. Milton, Chief Executive Officer



•

Mark A. Russell, President



•

Kim J. Brady, Chief Financial Officer

Summary Compensation Table

        The following table sets forth information concerning the compensation of the named executive officers for the year ended December 31,2019.

Narrative Disclosure to Summary Compensation Table

        For 2019, the compensation program for Nikola's named executive officers consisted of base salary and incentive compensation delivered in theform of stock option awards.

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Base Salary

        Base salary is set at a level that is commensurate with the executive's duties and authorities, contributions, prior experience and sustainedperformance.

Cash Bonus

        We do not have any arrangements with our named executive officers providing for annual cash bonus awards.

2017 Stock Option Plan

        Stock options were granted to the named executive officers under the Nikola Corporation 2017 Stock Option Plan (the "2017 Plan"), which wasapproved by Legacy Nikola's board of directors on July 10, 2017 (the "Legacy Nikola Options"). 15,000,000 shares of Legacy Nikola common stock were initially reserved for issuance under the2017 Plan, which reserve was subsequently increased to 33,829,336 shares. Legacy Nikola's board of directors administered the 2017 Plan and the awards granted under it.

        The2017 Plan provides for the grant of incentive stock options, which qualify for favorable tax treatment to recipients under Section 422 of the Code and non-qualified stockoptions. Such awards may be granted to Nikola's employees, directors and consultants. Legacy Nikola Options were granted at a price not less than the fair market value on the date of grant andgenerally become exercisable between one and four years after the date of grant. The Legacy Nikola Options expire not more than 10 years from the date of grant.

        Inconnection with the Business Combination Agreement, each of the Legacy Nikola Options that was outstanding immediately prior to the Closing, whether vested or unvested, was convertedinto an option to purchase a number of shares of Common Stock equal to the product (rounded down to the nearest whole number) of (i) the number of shares of Legacy Nikola common stock subjectto such option immediately prior to the Closing and (ii) the 1.901 (the "Exchange Ratio"), at an exercise price pershare (rounded up to the nearest whole cent) equal to (A) the exercise price per share of such option immediately prior to the Closing, divided by (B) the Exchange Ratio. All otherprovisions which govern either the exercise or the termination of Legacy Nikola Options remain the same.

2020 Stock Incentive Plan and 2020 Employee Stock Purchase Plan

        At Nikola's special meeting of stockholders held on June 2, 2020 in lieu of the 2020 annual meeting of stockholders (the "SpecialMeeting"), Nikola's stockholders approved the 2020 Plan and the 2020 ESPP. The 2020 Plan and the 2020 ESPP were previously approved, subject to stockholder approval, by the Board on May 6,2020. The 2020 Plan and the 2020 ESPP became effective immediately upon the Closing.

Benefits and Perquisites

        We provide benefits to our named executive officers on the same basis as provided to all of our employees, including health, dental and visioninsurance; life insurance; accidental death and dismemberment insurance; critical illness insurance; short-and long-term disability insurance; a health savings account; a wellness incentive; and atax-qualified Section 401(k) plan for which we do not provide a match. We do not maintain any executive-specific benefit or perquisite programs.

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Tax Gross-Ups

        In 2019, Nikola provided a tax gross up payment to Mr. Brady in connection with the reimbursement of qualified relocation expenses tooffset his out of pocket costs for relocating to Arizona at Nikola's request.

Agreements with Named Executive Officers and Potential Payments Upon Termination or Change of Control

        On the Closing Date, we entered into individual amended and restated employment agreements with our named executive officers, which supersededtheir existing employment agreements. Details of the employment agreements are outlined below.

Agreement with Trevor R. Milton

        On June 3, 2020, Trevor R. Milton entered into an amended and restated employment agreement with the Company to serve as ExecutiveChairman of the Board. Mr. Milton's employment will continue until terminated in accordance with the terms of the employment agreement. Pursuant to the employment agreement, Mr. Milton'sannual base salary is $1. Mr. Milton's employment agreement provides that he is eligible to participate in the Company's health and welfare benefit plans maintained for the benefit of Companyemployees. Mr. Milton has declined to participate in any annual cash bonus program provided by the Company, without regard to his eligibility for any such program. Subject to Board approval,Mr. Milton is eligible to receive an annual time-vested stock award consisting of RSUs for shares of Common Stock having a value on the date of grant of not less than $6,000,000 (based on anassumed stock value of $10.00 per share for the initial grant), subject to continued employment during a three-year cliff vesting schedule, and a performance-based stock award consisting of 4,859,000RSUs which can be earned upon the achievement of pre-established share price milestones, subject to continued employment during a performance period that ends on the third anniversary of the ClosingDate. Mr. Milton's employment agreement contains customary confidentiality, non-solicitation and intellectual property assignment provisions.

        Pursuantto the employment agreement, in the event of an Involuntary Termination (as defined in the agreement) of Mr. Milton's employment, the Company will engageMr. Milton as a non-employee consultant for the period commencing on the termination date and ending on the second anniversary of the termination date. As consideration for his consultingservices, the Company will pay Mr. Milton $10.0 million on each of the first and second anniversaries of the termination date. In the event of such Involuntary Termination and subject toMr. Milton's delivery of an effective release of claims and ongoing compliance with certain post-termination restrictive covenants, including a two-year non-compete and non-solicit covenantsand a mutual non-disparagement covenant, all of Mr. Milton's unvested equity awards, including his performance-based stock award, will accelerate in full (and the post-termination exerciseperiod for unexercised stock options will be extended until the earlier of (i) three years following his termination date or (ii) the remaining term of each such stock option), andMr. Milton will be entitled to a lump sum cash payment equal to 18 months of COBRA benefits coverage, less applicable withholding taxes.

Agreement with Mark A. Russell

        On June 3, 2020, Mark A. Russell entered into an amended and restated employment agreement with the Company to serve as President andChief Executive Officer. Mr. Russell's employment will continue until terminated in accordance with the terms of the employment agreement. Pursuant to the employment agreement,Mr. Russell's annual base salary is $1. Mr. Russell's employment agreement provides that he is eligible to participate in the Company's health and welfare benefit plans maintained forthe benefit of Company employees. Mr. Russell has declined to participate in any annual cash bonus program provided by the Company, without regard to his eligibility for any such program.

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Subjectto Board approval, Mr. Russell is eligible to receive an annual time-vested stock award consisting of RSUs for shares of Common Stock having a value on the date of grant of not lessthan $6,000,000 (based on an assumed stock value of $10.00 per share for the initial grant), subject to continued employment during a three-year cliff vesting schedule, and a performance-based stockaward consisting of 4,859,000 RSUs which can be earned upon the achievement of pre-established share price milestones, subject to continued employment during a performance period that ends on thethird anniversary of the Closing Date. As of the Effective Time, all unvested stock options then held by Mr. Russell vested in full. Mr. Russell's employment agreement contains customaryconfidentiality, non-solicitation and intellectual property assignment provisions.

        Pursuantto the employment agreement, in the event of an Involuntary Termination (as defined in the agreement) of Mr. Russell's employment and subject to Mr. Russell'sdelivery of an effective release of claims and ongoing compliance with certain post-termination restrictive covenants, including a two-year non-compete and non-solicit covenants and anon-disparagement covenant, Mr. Russell will be entitled to receive: (1) a lump sum cash payment in an amount equal to $2,600,000, less applicable withholding taxes; (2) a lumpsum cash payment equal to 18 months of COBRA benefits coverage, less applicable withholding taxes; (3) the acceleration in full of all unvested equity and equity-based awards, other thanMr. Russell's performance-based award (and the post-termination exercise period for unexercised stock options will be extended to three years following his termination date); and(4) following certification by the Board, Mr. Russell's performance-based stock award will vest in an amount based upon the achievement of the share price milestones prior to histermination date, pro-rated for the length of his employment during the performance period.

Agreement with Kim J. Brady

        On June 3, 2020, Kim J. Brady entered into an amended and restated employment agreement with the Company to serve as Chief FinancialOfficer. Mr. Brady's employment will continue until terminated in accordance with the terms of the employment agreement. Pursuant to the employment agreement, Mr. Brady's annual basesalary is $1. Mr. Brady's employment agreement provides that he is eligible to participate in the Company's health and welfare benefit plans maintained for the benefit of Company employees.Mr. Brady has declined to participate in any annual cash bonus program provided by the Company, without regard to his eligibility for any such program. Subject to Board approval,Mr. Brady is eligible to receive an annual time-vested stock award consisting of RSUs for shares of Common Stock having a value on the date of grant of not less than $3,200,000 (based on anassumed stock value of $10.00 per share for the initial grant), subject to continued employment during a three-year cliff vesting schedule, and a performance-based stock award consisting of 2,591,000RSUs which can be earned upon the achievement of pre-established share price milestones, subject to continued employment during a performance period that ends on the third anniversary of the ClosingDate. As of the Effective Time, all unvested stock options then held by Mr. Brady vested in full. Mr. Brady's employment agreement contains customary confidentiality, non-solicitationand intellectual property assignment provisions.

        Pursuantto the employment agreement, in the event of an Involuntary Termination (as defined in the agreement) of Mr. Brady's employment and subject to Mr. Brady's deliveryof an effective release of claims and ongoing compliance with certain post-termination restrictive covenants, including a two-year non-compete and non-solicit covenants and a non-disparagementcovenant, Mr. Brady will be entitled to receive: (1) a lump sum cash payment in an amount equal to $1,050,000, less applicable withholding taxes; (2) a lump sum cash payment equalto 18 months of COBRA benefits coverage, less applicable withholding taxes; (3) the acceleration in full of all unvested equity and equity-based awards, other than Mr. Brady'sperformance-based award (and the post-termination exercise period for unexercised stock options will be extended to three years following his termination date); and (4) following certificationby the Board, Mr. Brady's performance-based stock award will vest in an

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amountbased upon the achievement of the share price milestones prior to his termination date, pro-rated for the length of his employment during the performance period.

Retirement Benefits

        We provide a tax-qualified Section 401(k) plan for all employees, including the named executive officers. We do not provide a match forparticipants' elective contributions to the 401(k) plan, nor do we provide to employees, including the named executive officers, any other retirement benefits, including but not limited totax-qualified defined benefit plans, supplemental executive retirement plans and nonqualified defined contribution plans.

Outstanding Equity Awards at 2019 Year End

        The following table presents information regarding outstanding equity awards held by Nikola's named executive officers as of December 31,2019.

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CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS

        The following includes a summary of transactions since January 1, 2019 to which we have been a party, in whichthe amount involved in the transaction exceeded $120,000, and in which any of our directors, executive officers or, to our knowledge, beneficial owners of more than 5% of our capital stock or anymember of the immediate family of any of the foregoing persons had or will have a direct or indirect material interest, other than equity and other compensation, termination, change of control, andother arrangements, which are described under the section entitled "Executive Compensation."

Private Placement

        On June 3, 2020, a number of purchasers (each, a "Subscriber") purchased from the Company an aggregate of 52,500,000 shares of CommonStock (the "PIPE Shares"), for a purchase price of $10.00 per share and an aggregate purchase price of $525.0 million, pursuant to separate subscription agreements (each, a "SubscriptionAgreement") entered into effective as of March 2, 2020. Pursuant to the Subscription Agreements, the Company gave certain registration rights to the Subscribers with respect to the PIPE Shares.The sale of PIPE Shares was consummated concurrently with the Closing. ValueAct Spring Master Fund, L.P, which is affiliated with Jeffrey W. Ubben, a member of the Board, purchased 5,000,000 shares ofCommon Stock in the PIPE for a total purchase price of $50.0 million.

Stockholder Support Agreement

        On March 2, 2020, Legacy Nikola, the VectoIQ and certain Legacy Nikola stockholders entered into a Stockholder Support Agreement with theCompany (the "Stockholder Support Agreement"), whereby certain Legacy Nikola stockholders agreed to vote all of their shares of Legacy Nikola's capital stock in favor of the approval and adoption ofthe Business Combination and related transactions. Additionally, such stockholders agreed not to transfer any of their shares of Legacy Nikola common stock and Legacy Nikola preferred stock (or enterinto any arrangement with respect thereto) or enter into any voting arrangement that is inconsistent with the Stockholder Support Agreement.

Indemnification Agreements

        Nikola entered into separate indemnification agreements with its directors and executive officers, in addition to the indemnification providedfor in the Certificate of Incorporation and the Bylaws. These agreements, among other things, require Nikola to indemnify Nikola's directors and executive officers for certain expenses, includingattorneys' fees, judgments, fines and settlement amounts incurred by a director or executive officer in any action or proceeding arising out of their services as one of Nikola's directors or executiveofficers or as a director or executive officer of any other company or enterprise to which the person provides services at Nikola's request. For more information regarding these indemnificationarrangements, see the section entitled "Management—Limitation on Liability and Indemnification of Directors and Officers."Nikola believes that these charter provisions and indemnification agreements are necessary to attract and retain qualified persons as directors and officers.

        Thelimitation of liability and indemnification provisions in the Certificate of Incorporation and the Bylaws may discourage stockholders from bringing a lawsuit against directors forbreach of their fiduciary duties. They may also reduce the likelihood of derivative litigation against directors and officers, even though an action, if successful, might benefit Nikola and itsstockholders. A stockholder's investment may decline in value to the extent we pay the costs of settlement and damage awards against directors and officers pursuant to these indemnificationprovisions.

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Equity Financings

Series D Preferred Stock Financing

        From September 30, 2019 through March 12, 2020, Legacy Nikola sold an aggregate of 7,357,059 shares of Series D preferredstock at a purchase price of $18.52 per share or $19.01 if sold after the date of the Business Combination Agreement, for an aggregate purchase price of $136,278,508.64, pursuant to Legacy Nikola'sSeries D preferred stock financing. In connection with the Series D preferred stock financing, Legacy Nikola entered into a Series D preferred stock purchase agreement and theCNHI Services Agreement with CNHI and Iveco. Under these agreements, the Company issued to Iveco 13,498,921 shares of Series D preferred stock in exchange for a license valued at$50.0 million, $100.0 million in-kind services and $100.0 million in cash.

        In2019, Legacy Nikola issued 2,699,785 shares of Series D preferred stock to Iveco in exchange for $50.0 million. Legacy Nikola also issued 2,699,785 shares ofSeries D preferred stock to Iveco in exchange for licensed Iveco technology and 431,996 shares of Series D preferred stock to Iveco in exchange for $8.0 million in in-kindservices.

        InApril 2020, Legacy Nikola issued an additional 2,699,784 shares of Series D preferred stock to CNHI and Iveco in exchange for approximately $50.0 million pursuant to theSeries D preferred stock purchase agreement and 1,079,914 shares pursuant to the Technical Assistance Service Agreement as a payment for in-kind services provided in the first quarter of 2020as well as prepayment for future services. Prior to the Effective Time, Legacy Nikola issued an additional 3,887,657 shares to Iveco as prepayment for additional services to be provided to LegacyNikola during the remainder of 2020 and 2021 pursuant to the Technical Assistance Service Agreement.

        Thefollowing table summarizes purchases of Legacy Nikola's Series D preferred stock by related persons and their affiliated entities. None of Legacy Nikola's executive officerspurchased shares of Series D preferred stock.

Stockholder Agreement

        Legacy Nikola entered into a fourth amended and restated stockholder agreement dated September 30, 2019 ("Stockholder Agreement"), whichgranted rights to certain holders of its stock, including (i) M&M Residual, LLC is controlled by Legacy Nikola's Chief Executive Officer, Trevor R. Milton, (ii) OTWSTL LLC, of which William Milton, previously a member of the Legacy Nikola's board of directors, is a member, (iii) WI Ventures, LLC, Nimbus Holdings LLC, Green NikolaHoldings LLC, and CNHI, each of which held a beneficial ownership stake in Legacy Nikola that is greater than 5% as of the Closing Date, (iv) Thompson Nikola, LLC, Thompson NikolaII LLC, and Legend Capital Partners, of which DeWitt C. Thompson, V, a member of the Board, is the president, (v) ValueAct Spring Master Fund, L.P. and VA Spring NM, LLC("VA Spring"), which are affiliated

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withJeffery W. Ubben, a member of the Board, (vi) Kim J. Brady, Legacy Nikola's Chief Financial Officer, (vii) Mark A. Russell, Legacy Nikola's President and (viii) T&MResidual, LLC, which is controlled by Trevor R. Milton and Mark A. Russell (collectively, the "Agreement Parties").

        Pursuantto the Stockholder Agreement, certain holders of Legacy Nikola's capital stock, including the Agreement Parties, and certain of Legacy Nikola's current and former serviceproviders, agreed to vote in a certain way on certain matters, including with respect to the election of directors of Legacy Nikola. The Stockholder Agreement also provides the parties thereto withcertain registration rights, pre-emptive rights, information and inspection rights, drag-along rights and rights of first offer, among other rights. This Stockholder Agreement terminated upon theconsummation of the Business Combination.

Repurchase Agreements

        On March 2, 2020, in accordance with the redemption rights granted pursuant to that certain letter agreement by and between Legacy Nikolaand Nimbus, dated August 3, 2018 (as amended, the "Nimbus Redemption Letter Agreement"), which gave Nimbus the right to sell back to Legacy Nikola a portion of its shares of Series Bpreferred stock and Series C preferred stock from time to time upon the consummation of future equity capital raises by Legacy Nikola, Legacy Nikola entered into a Series B preferredstock repurchase agreement with Nimbus, whereby Legacy Nikola agreed torepurchase 1,499,700 shares of Legacy Nikola's Series B preferred stock from Nimbus at a price of $16.67 per share for an aggregate repurchase price of $25.0 million. The parties agreedthat the aggregate repurchase price constituted a credit towards the number of shares that Nimbus would otherwise be entitled to redeem under any letter agreement between Legacy Nikola and Nimbus.

        OnSeptember 3, 2019, in accordance with the redemption rights granted pursuant to the Nimbus Redemption Letter Agreement, Legacy Nikola entered into a Series B preferredstock repurchase agreement with Nimbus, whereby Legacy Nikola repurchased 1,880,984 shares of Legacy Nikola's Series B preferred stock from Nimbus at a price of $16.67 per share for anaggregate repurchase price of $31.4 million.

Commercial Agreements

Agreements with Nimbus

        On March 2, 2020, Legacy Nikola entered into a Commercial Letter Agreement with Nimbus, whereby Legacy Nikola agreed to use Nimbus'affiliates' autonomous driving components on Legacy Nikola's autonomy equipped trucks, subject to certain conditions, negotiate inverter development, fuel cell power module development and part supplywith Nimbus, and obligate Legacy Nikola to receive services resulting in a minimum payment to Nimbus and its affiliates. Nimbus also agreed to terminate the Nimbus Redemption Letter Agreement as ofthe Effective Time of the Merger. We believe the terms of this agreement are generally no less favorable to Legacy Nikola than those that could be obtained in similar transactions with unaffiliatedthird parties.

Agreements with Bosch Entities

        Legacy Nikola maintained commercial relationships with Robert Bosch, LLC ("Bosch"), Robert Bosch Battery Systems, LLC ("BoschBattery") and Robert Bosch Automotive Steering, LLC ("Bosch Steering") (collectively with Bosch and Bosch Battery, the "Bosch Entities"). Robert Bosch GmbH is

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theparent company of the Bosch Entities, and Nimbus is an affiliate of Robert Bosch GmbH. Since 2017, Legacy Nikola entered into the following agreements with the BoschEntities:

•

an agreement with Bosch valued at $8.3 million, whereby Bosch agreed to develop and support Legacy Nikola's Vehicle Control Unit ("VCU")for both Legacy Nikola's UTV and Truck vehicle platforms;



•

an agreement with Bosch valued at $6.4 million to develop and provide motors for both the Truck and UTV vehicle platforms;



•

an agreement with Bosch valued at $5.7 million, whereby Bosch agreed to develop, build, test, and support Legacy Nikola's Fuel CellSystem for Legacy Nikola's Alpha Nikola Two FCEV truck;



•

an agreement with Bosch Battery valued at $7.5 million, whereby Bosch Battery agreed to develop, build, test and support Legacy Nikola'sbattery pack for the Alpha Nikola Two FCEV truck;



•

an agreement with Bosch Steering valued at $3.3 million, whereby Bosch Steering agreed to develop the Servotwin Steering Gear andElectro-Hydraulic Steering Pump System ("EHPS") Legacy Nikola's Truck platforms; and



•

agreements with various Bosch Entities valued at $6.5 million in the aggregate, whereby the Bosch Entities develop vehicle componentsand provide vehicle level support in numerous areas, including functional safety, electrical architecture, body control module, cybersecurity, tank control unit, central gateway unit, anti-lockbraking, and highly automated driving studies.

Agreements with CNHI/Iveco

        On September 30, 2019, Legacy Nikola entered into a European alliance agreement with CNHI and Iveco (the "European Alliance Agreement"),whereby Legacy Nikola and CNHI/Iveco agreed to establish an entity for the purposes of designing, developing, engineering and manufacturing pure electric and hydrogen heavy trucks in Europe. Iveco isa beneficial owner of more than 5% of our Common Stock and Gerrit A. Marx, a member of the Board, serves as president of commercial and specialty vehicles of CNHI. Pursuant to the European AllianceAgreement, Legacy Nikola and Iveco will contribute equal amounts of cash and in kind contributions necessary for each of party to subscribe to 50% of the capital stock of the entity contemplated bythe agreement. The initial term of the European Alliance Agreement expires on December 31, 2030, with automatic renewals of ten-year periods unless terminated by either party with writtennotice received by the non-terminating party no later than December 31, 2029 for the initial term and no later than the end of the 7th year of any subsequent term. We believe thecontribution and capitalization terms of this agreement are generally no less favorable to Legacy Nikola than those that could be obtained in similar transactions with unaffiliated third parties.

Services Agreement

        On December 14, 2016, Legacy Nikola entered into a Services Agreement with Thompson Truck Center, LLC ("Thompson") (the "ServicesAgreement"), whereby Legacy Nikola appointed Thompson as its exclusive distributor of certain repair services, distribution services and parts distribution services in Tennessee and Mississippi,subject to exceptions set forth in the Services Agreement. DeWitt C. Thompson, V, a director of Legacy Nikola, is the president of Thompson Truck Center, LLC. Under the Services Agreement,Nikola agreed to indemnify Thompson for any infringement arising out of Thompson's authorized use of Legacy Nikola's intellectual property along with standard indemnification provisions. Pricing underthis agreement varies depending on the specifications set forth in any given purchase order for Legacy Nikola vehicles and vehicle parts. Thompson is entitled to an $8,000

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commissionfee for each Legacy Nikola vehicle Thompson sells to a third party, to hourly warranty services charges and to 120% of the cost of certain vehicle parts not provided by Legacy Nikola inconnection with such warranty service repairs. We believe that the general commercial terms of this agreement, including with respect to pricing and commission fees, were generally consistent withcomparable terms under our purchase orders or similar arrangements with other servicers and distributors, and were generally no less favorable to Legacy Nikola than those that could be obtained insimilar types of transactions with unrelated third parties. The term of the Services Agreement continues until December 31, 2026, and automatically renews for successive five-year terms unlessterminated by either party in writing at least six months prior to the end of the initial term or the then-current renewal term.

Transactions with Executive Officers

        Immediately following the Effective Time, pursuant to a redemption agreement, Nikola redeemed 7,000,000 shares of Common Stock from M&MResidual, LLC at a purchase price of $10.00 per share, payable in immediately available funds. M&M Residual, LLC is a Nevada limited liability company that is wholly owned by Trevor R.Milton, Legacy Nikola's Chief Executive Officer. The number of shares to be redeemed and the redemption price were determined and agreed upon during negotiations between the various parties to theBusiness Combination, including Mr. Milton and representatives of VectoIQ, Legacy Nikola and the Subscribers. This redemption was undertaken to allow Mr. Milton, the founder of LegacyNikola, to attain some liquidity prior to his becoming an executive officer of a publicly traded entity and subject to lock-up restrictions, and it was approved by the disinterested directors ofLegacy Nikola.

        LegacyNikola reimbursed affiliates for reasonable travel related expenses incurred while conducting business on behalf of Legacy Nikola, including the use of private aircraft. SinceJanuary 2019, Legacy Nikola personnel occasionally used an aircraft leased to Legacy Nikola by Zero Emission Expedition LLC, which is owned by Trevor R. Milton, Legacy Nikola's Chief ExecutiveOfficer, for business related purposes. In 2019, Legacy Nikola reimbursed Zero Emission Expedition LLC $0.2 million in connection with Legacy Nikola personnel's use of Zero EmissionExpedition LLC's aircraft. Legacy Nikola's business arrangement with Zero Emission Expedition LLC is continuing for Legacy Nikola's 2020 fiscal year. For the three months endedMarch 31, 2020, Legacy Nikola reimbursed $0.2 million to Zero Emission Expedition LLC.

        TrevorR. Milton, Legacy Nikola's Chief Executive Officer, paid Legacy Nikola $0.05 million, $0.3 million and $0.2 million for the provision of solar installationservices for the three months ended March 31, 2020 and years ended 2019 and 2018, respectively. As of March 31, 2020, and December 31, 2019, Legacy Nikola recorded $0.03 and$0.05 million, respectively, outstanding in accounts receivable relatedto solar installation services from Mr. Milton. Legacy Nikola received no related party revenue during 2017 and recorded no related party accounts receivable outstanding as ofDecember 31, 2018. Mr. Milton repaid any amounts outstanding as of December 31, 2019 in full as of February 6, 2020 and as of March 31, 2020 in full as ofMay 30, 2020.

        InDecember 2018, M&M Residual, LLC, a Nevada limited liability company owned by Trevor R. Milton, Legacy Nikola's Chief Executive Officer, issued 3,158,949 performance-basedstock options (the "Performance Awards") pursuant to Legacy Nikola's Founder Stock Option Plan. The Performance Awards were issued to recognize the superior performance and contribution of specificemployees of Legacy Nikola, including Mr. Milton's relatives, Travis Milton and Lance Milton, Britton M. Worthen, Legacy Nikola's Chief Legal Officer and Secretary and Joseph R. Pike, LegacyNikola's Chief Human Resources Officer. M&M Residual, LLC owned the shares of Legacy Nikola common stock underlying the Performance Awards, which are considered to be issued by Legacy Nikolafor accounting purposes. The Performance Awards were to vest based on Legacy Nikola's achievement of a liquidation event, such as a private sale or an initial public offering on a U.S. stock exchange.The weighted average grant

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datefair value of the Performance Awards was $1.19 for the year ended December 31, 2018. As of December 31, 2019, Performance Awards had not vested and the unrecognized stock-basedcompensation expense related to the option awards was $3.8 million. Stock-based compensation expense of $3.8 million was recognized upon close of the Business Combination and subsequentpublic listing of the Company as of June 3, 2020.

        OnApril 27, 2020, M&M Residual, LLC and an affiliate and VA Spring and an affiliate entered into two agreements under which M&M Residual, LLC agreed to transfer315,624 shares of Legacy Nikola common stock valued at a price of $19.01 per share ($6,000,000 in total) to VA Spring, in exchange for the transfer of certain personal property to Trevor R. Milton,Legacy Nikola's Chief Executive Officer. M&M Residual, LLC is wholly owned by Mr. Milton and Jeffrey W. Ubben, a director of Legacy Nikola, is the managing member of VA Spring. Thetransaction was completed in May 2020.

        OnMay 18, 2020 and May 19, 2020, VA Spring purchased an aggregate of 2,356,655 shares of Legacy Nikola common stock from certain employees, advisors and former employeesof Legacy Nikola at a purchase price of $19.01 per share of Legacy Nikola common stock, including shares purchased from the following executive officers: Mark A. Russell, Chief Executive Officer(200,000 shares), Trevor R. Milton, Executive Chairman (1,266,102 shares from M&M Residual, LLC which is controlled by Mr. Milton), Britton M. Worthen, Chief Legal Officer andCorporate Secretary (200,000 shares), Kim J. Brady, Chief Financial Officer (200,000 shares) and Joseph R. Pike, Chief Human Resources Officer (34,476 shares). Jeffrey W. Ubben, a member of theBoard, is the managing member VA Spring.

        OnJune 2, 2020, T&M Residual, LLC, an entity owned by Mr. Milton and Mr. Russell and managed by Mr. Milton, transferred 14,109,607 shares of LegacyNikola common stock to Mr. Milton, who then contributed the shares to M&M Residual, LLC, an entity wholly owned by Mr. Milton. In connection with such transfer, Mr. Miltonwas granted a proxy to vote the remaining shares of Common Stock held by T&M Residual, LLC until the earlier of June 2, 2023 or the earlier death or permanent disability ofMr. Milton. As part of the same transaction, Mr. Russell was appointed as the manager of T&M Residual, LLC.

Employment Agreements

        Effective as of June 3, 2020, we entered into individual amended and restated employment agreements with our executive officers, TrevorR. Milton, Mark A. Russell, Kim J. Brady, Joseph R. Pike and Britton M. Worthen, which superseded their existing employment agreements. Details of the employment agreements for the named executiveofficers are in the section entitled "Executive Compensation—Narrative Disclosure to Summary Compensation Table—Agreements with Named Executive Officersand Potential Payments Upon Termination or Change of Control" and details of employment agreement with Messrs. Pike and Worthen are outlined below.

Agreement with Joseph R. Pike

        On June 3, 2020, Joseph R. Pike entered into an amended and restated employment agreement with the Company to serve as Chief HumanResources Officer. Mr. Pike's employment will continue until terminated in accordance with the terms of the employment agreement. Pursuant to the employment agreement, Mr. Pike's annualbase salary is $1. Mr. Pike's employment agreement provides that he is eligible to participate in the Company's health and welfare benefit plans maintained for the benefit of Company employees.Mr. Pike has declined to participate in any annual cash bonus program provided by the Company, without regard to his eligibility for any such program. Subject to Board approval, Mr. Pikeis eligible to receive an annual time-vested stock award consisting of RSUs for shares of Common Stock having a value on the date of grant of not less than $2,000,000 (based on an

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assumedstock value of $10.00 per share for the initial grant), subject to continued employment during a three-year cliff vesting schedule, and a performance-based stock award consisting of 1,619,000RSUs which can be earned upon the achievement of pre-established share price milestones, subject to continued employment during a performance period that ends on the third anniversary of the ClosingDate. As of the Effective Time, all unvested stock options then held by Mr. Pike vested in full. Mr. Pike's employment agreement contains customary confidentiality, non-solicitation andintellectual property assignment provisions.

        Pursuantto the employment agreement, in the event of an Involuntary Termination (as defined in the agreement) of Mr. Pike's employment and subject to Mr. Pike's deliveryof an effective release of claims and ongoing compliance with certain post-termination restrictive covenants, including a two-year non-compete and non-solicit covenants and a non-disparagementcovenant, Mr. Pike will be entitled to receive: (1) a lump sum cash payment in an amount equal to $945,000, less applicable withholding taxes; (2) a lump sum cash payment equal to18 months of COBRA benefits coverage, less applicable withholding taxes; (3) the acceleration in full of all unvested equity and equity-based awards, other than Mr. Pike'sperformance-based award (and the post-termination exercise period for unexercised stock options will be extended to three years following his termination date); and (4) following certificationby the Board, Mr. Pike's performance-based stock award will vest in an amount based upon the achievement of the share price milestones prior to his termination date, pro-rated for the length ofhis employment during the performance period.

Agreement with Britton M. Worthen

        On June 3, 2020, Britton M. Worthen entered into an amended and restated employment agreement with the Company to serve as Chief LegalOfficer. Mr. Worthen's employment will continue until terminated in accordance with the terms of the employment agreement. Pursuant to the employment agreement, Mr. Worthen's annual basesalary is $1. Mr. Worthen's employment agreement provides that he is eligible to participate in the Company's health and welfare benefit plans maintained for the benefit of Company employees.Mr. Worthen has declined to participate in any annual cash bonus program provided by the Company, without regard to his eligibility for any such program. Subject to Board approval,Mr. Worthen is eligible to receive an annual time-vested stock award consisting of RSUs for shares of Common Stock having a value on the date of grant of not less than $3,000,000 (based on anassumed stock value of $10.00 per share for the initial grant), subject to continued employment during a three-year cliff vesting schedule, and a performance-based stock award consisting of 2,428,000RSUs which can be earned upon the achievement of pre-established share price milestones, subject to continued employment during a performance period that ends on the third anniversary of the ClosingDate. As of the Effective Time, all unvested stock options then held by Mr. Worthen vested in full. Mr. Worthen's employment agreement contains customary confidentiality,non-solicitation and intellectual property assignment provisions.

        Pursuantto the employment agreement, in the event of an Involuntary Termination (as defined in the agreement) of Mr. Worthen's employment and subject to Mr. Worthen'sdelivery of an effective release of claims and ongoing compliance with certain post-termination restrictive covenants, including a two-year non-compete and non-solicit covenants and anon-disparagement covenant, Mr. Worthen will be entitled to receive: (1) a lump sum cash payment in an amount equal to $1,050,000, less applicable withholding taxes; (2) a lumpsum cash payment equal to 18 months of COBRA benefits coverage, less applicable withholding taxes; (3) the acceleration in full of all unvested equity and equity-based awards, other thanMr. Worthen's performance-based award (and the post-termination exercise period for unexercised stock options will be extended to three years following his termination date); and(4) following certification by the Board, Mr. Worthen's performance-based stock award will vest in an amount based upon the achievement of the share price milestones prior to histermination date, pro-rated for the length of his employment during the performance period.

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Related Person Transactions Policy

        The Board adopted a written Related Person Transactions Policy that sets forth our policies and procedures regarding the identification, review,consideration and oversight of "related person transactions." For purposes of our policy, a "related person transaction" is a transaction, arrangement or relationship (or any series of similartransactions, arrangements or relationships) in which Nikola or any of its subsidiaries are participants involving an amount that exceeds $120,000, in which any "related person" has a materialinterest.

        Transactionsinvolving compensation for services provided to Nikola as an employee, consultant or director will not be considered related person transactions under this policy. A relatedperson is any executive officer, director, nominee to become a director or a holder of more than 5% of any class of Nikola's voting securities (including Common Stock), including any of theirimmediate family members and affiliates, including entities owned or controlled by such persons.

        Underthe policy, the related person in question or, in the case of transactions with a holder of more than 5% of any class of Nikola's voting securities, an officer with knowledge of aproposed transaction, must present information regarding the proposed related person transaction to our general counsel and audit committee (or, where review by our audit committee would beinappropriate, to another independent body of the Board) for review. To identify related person transactions in advance, Nikola will rely on information supplied by Nikola's executive officers,directors and certain significant stockholders. In considering related person transactions, our audit committee will take into account therelevant available facts and circumstances, which may include, but are not limited to:

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the risks, costs, and benefits to Nikola;



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the impact on a director's independence in the event the related person is a director, immediate family member of a director or an entity withwhich a director is affiliated;



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the materiality and character of the related person's direct and indirect interest;



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the related person's actual or apparent conflict of interest;



•

the terms of the transaction;



•

the availability of other sources for comparable services or products; and



•

the terms available to or from, as the case may be, unrelated third parties.

        Ouraudit committee approves only those transactions that it determines are fair to us and in Nikola's best interests. All of the transactions described above were entered into prior tothe adoption of such policy.

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PRINCIPAL SECURITYHOLDERS

        The following table sets forth information known to the Company regarding the beneficial ownership of the Common Stock as of June 3,2020, after giving effect to the Closing and the M&M Redemption, by:

•

each person who is known by the Company to be the beneficial owner of more than five percent (5%) of the outstanding shares of the CommonStock;



•

each current named executive officer and director of the Company; and



•

all current executive officers and directors of the Company, as a group.

        Beneficialownership is determined according to the rules of the SEC, which generally provide that a person has beneficial ownership of a security if he, she or it possesses sole orshared voting or investment power over that security, including options and warrants that are currently exercisable or exercisable within 60 days.

        Thebeneficial ownership percentages set forth in the table below are based on 360,904,478 shares of Common Stock issued and outstanding as of June 3, 2020 and do not take intoaccount the issuance of any shares of Common Stock upon the exercise of warrants to purchase up to 23,890,000 shares of Common Stock that remain outstanding.

        Unlessotherwise noted in the footnotes to the following table, and subject to applicable community property laws, the persons and entities named in the table have sole voting andinvestment power with respect to their beneficially owned common stock and preferred stock.

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SELLING SECURITYHOLDERS

        The Selling Securityholders listed in the table below may from time to time offer and sell any or all of the shares of Common Stock set forthbelow pursuant to this prospectus. Pursuant to the Registration Rights and Lock-Up Agreement, we agreed to file a registration statement with the SEC for the purposes of registering for resalethe shares of our Common Stock being offered pursuant to this prospectus by the Selling Securityholders.

        Thefollowing table sets forth, based on written representations from the Selling Securityholders, certain information regarding the beneficial ownership of our Common Stock by theSelling Securityholders and the shares of Common Stock being offered by the Selling Securityholders. The applicable percentage ownership of Common Stock is based on approximately 360,904,478 shares ofCommon Stock outstanding as of June 3, 2020. Information with respect to shares of Common Stock owned beneficially after the offering assumes the sale of all of the shares of Common Stockoffered and no other purchases or sales of our Common Stock. The Selling Securityholders may offer and sell some, all or none of their shares of Common Stock.

        Wehave determined beneficial ownership in accordance with the rules of the SEC. Except as indicated by the footnotes below, we believe, based on the information furnished to us, thatthe Selling Securityholders have sole voting and investment power with respect to all shares of Common Stock that they beneficially own, subject to applicable community property laws. Except asotherwise described

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below,based on the information provided to us by the Selling Securityholders, no Selling Securityholder is a broker-dealer or an affiliate of a broker-dealer.

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Certain Relationships with Selling Securityholders

Registration Rights and Lock-Up Agreement

        Certain persons and entities (the "Original Holders") holding shares of Common Stock initially purchased by the Sponsor and Cowen InvestmentsII, LLC ("Cowen Investments" and, together with the Sponsor, the "Founders") in a private placement in connection with the IPO (the "Founder Shares") and VectoIQ Units purchased in a privateplacement in connection with the IPO (the "Private Units) and certain stockholders of Legacy Nikola (the "New Holders" and, collectively with the Original Holders, the "Holders") entered into theRegistration Rights and Lock-Up Agreement on June 3, 2020, which was subsequently amended on July 17, 2020 (as amended to date, the "Registration Rights and Lock-Up Agreement"). Pursuantto the terms of the Registration Rights and Lock-Up Agreement, we are obligated to file a registration statement to register the resale of certain of our securities held by the Holders. Inaddition, pursuant to the terms of the Registration Rights and Lock-Up Agreement and subject to certain requirements and customary conditions, including with regard to the number of demand rights thatmay be exercised, the Holders may demand at any time or from time to time, that we file a registration statement on Form S-3 (or on Form S-1 if Form S-3 is not available)to register our securities held by such Holders. The Registration Rights and Lock-Up Agreement provides the Holders with "piggy-back" registration rights, subject to certain requirements and customaryconditions.

        TheRegistration Rights and Lock-Up Agreement further provides for certain of our securities held by the Holders to be locked-up for a period of time following the Closing, as describedbelow, subject to certain exceptions. The securities held by the Original Holders will be locked-up for one year following the Closing, subject to earlier release if (i) the reported last saleprice of our Common Stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any30-trading day period commencing at least 150 days after the Closing or (ii) if we consummate a liquidation, merger, stock exchange or other similar transaction after the Closing whichresults in all of our stockholders having the right to exchange theirshares of our Common Stock for cash, securities or other property. The securities held by the New Holders, other than certain entities controlled by Trevor R. Milton, Legacy Nikola's Chief ExecutiveOfficer, will be locked-up for 180 days after the Closing. The securities held by M&M Residual, LLC and T&M Residual, LLC (each, a "Founder Entity"), over which Mr. Miltonhas voting control, will be locked up for 180 days after the Closing; provided that, each Founder Entity may transfer up to 16% of the shares held by such entity (the "Cap") only to the extentnecessary to enable such shares to be pledged as security or collateral in connection with indebtedness incurred by such Founder Entity solely for the purpose of purchasing additional shares of CommonStock, and provided further that each Founder Entity may transfer shares of Common Stock in excess of the Cap solely for the purposes of repaying indebtedness incurred by such Founder Entity solely topurchase shares of Common Stock secured by shares of Common Stock as permitted in the preceding proviso that cannot be satisfied with the pledged shares of Common Stock (but only if such repayment ofindebtedness is made on the maturity of such indebtedness, to satisfy a margin call by the lender or if otherwise required by the lender thereof).

Lock-Up Agreements

        In connection with the Closing, on June 3, 2020, the Company and certain stockholders of Legacy Nikola and executives of the Company (the"Legacy Holders") entered into a Lock-Up Agreement (each, a "Lock-Up Agreement"). The terms of the Lock-Up Agreements provide for the Common

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Stockheld by the Legacy Holders to be locked-up for a period of 180 days after the Closing Date, subject to certain exceptions, with certain stockholders being allowed to sell a certain numbershares after 30 days and 90 days, respectively.

VectoIQ Related Agreements

Founder Shares

        On February 15, 2018, the Founders purchased an aggregate of 5,750,000 shares of Common Stock, par value $0.0001, for an aggregatepurchase price of $25,000, or approximately $0.004 per share. The Sponsor and Cowen Investments purchased 4,301,000 and 1,449,000 of the Founder Shares, respectively. In March 2018, the Sponsortransferred 15,000 Founder Shares to each of its initial director nominees. In April 2018, the Sponsor forfeited 435,606 Founder Shares and certain funds and accounts managed by subsidiaries ofBlackRock, Inc. (the "Anchor Investor") purchased 435,606 Founder Shares for an aggregate purchase price of $1,894, or approximately $0.004 per share. In May 2018, Cowen Investments forfeited287,500 Founder Shares, which were subsequently purchased by the Sponsor and the Anchor Investor. Additionally, in May 2018, the Sponsor purchased 254,829 Founder Shares for an aggregate purchaseprice of $1,108, or approximately $0.004 per share, and the Anchor Investor purchased 32,671 Founder Shares for an aggregate purchase price of $142, or approximately $0.004 per share.

        TheFounders and VectoIQ's officers and directors (the "VectoIQ Initial Stockholders") have agreed, subject to limited exceptions, not to transfer, assign or sell any of its FounderShares until the earlier to occur of: (A) one year after the completion of the initial business combination and (B) subsequent to the initial Business Combination, (x) if the lastsale price of the common stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any30-trading day period commencing at least 150 days after the initial Business Combination, or (y) the date on which VectoIQ completes a liquidation, merger, capital stock exchange orother similar transaction that results in all of VectoIQ's stockholders having the right to exchange their shares of common stock for cash, securities or other property.

        Simultaneouslywith the IPO, the Founders and Anchor Investor purchased an aggregate of 890,000 Private Units (including 90,000 Private Units in connection with the exercise of theover-allotment option) at a price of $10.00 per Private Unit ($8.9 million in the aggregate) in a private placement. Each Private Unit consists of one Private Share and one Private Warrant.Each Private Warrant entitles the holder to purchase one share of Common Stock at a price of $11.50 per share, subject to adjustment. Proceeds from the Private Units were added to the proceeds fromthe IPO held in the Trust Account. If we do not complete an initial business combination within 24 months from the closing of our IPO, the proceeds from the sale of the Private Units held intrust will be part of the liquidating distribution to the Public Stockholders, and the Private Warrants will expire worthless. The Private Warrants will be non-redeemable and exercisable on a cashlessbasis so long as they are held by the Founders or their permitted transferees.

        TheVectoIQ Initial Stockholders have agreed, subject to limited exceptions, not to transfer, assign or sell any of their Private Units or the securities underlying the Private Unitsuntil the earlier to occur of: (A) one year after the completion of the initial Business Combination and (B) subsequent to the initial Business Combination, (x) if the last saleprice of the common stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any30-trading day period commencing at least 150 days after the initial BusinessCombination, or (y) the date on which VectoIQ completes a liquidation, merger, capital stock exchange or other similar transaction that results in all of the VectoIQ's stockholders having theright to exchange their shares of common stock for cash, securities or other property.

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Forward Purchase Agreement

        A fund affiliated with P. Schoenfeld Asset Management LP, which is referred to as the "Forward Purchase Investor," is a member of theSponsor and has entered into a contingent forward purchase agreement with VectoIQ (the "Forward Purchase Agreement"), which provides for the purchase by the Forward Purchase Investor of 2,500,000forward purchase shares, plus one redeemable Warrant for each forward purchase share, for total gross proceeds of up to $25.0 million. The Forward Purchase Investor purchased 2,500,000 sharesof Common Stock in the PIPE, and has no further right or obligation to purchase securities under the Forward Purchase Agreement. This issuance was made pursuant to the exemption from registrationcontained in Section 4(a)(2) of the Securities Act.

Sponsor Arrangements

        On March 1, 2018, the Sponsor agreed to loan the Company an aggregate of up to $100,000 to cover expenses related to the IPO pursuant toa promissory note. Also, on March 1, 2018, Cowen Investments agreed to loan the Company an aggregate of up to $100,000 to cover expenses related to the IPO pursuant to a second promissory noteon the same terms as the loan provided by the Sponsor. These loans are non-interest bearing and were repaid with the proceeds from the IPO.

        TheCompany entered into an agreement, commencing on the effective date of the IPO through the earlier of the Company's consummation of a business combination and its liquidation, to paythe Sponsor a total of $10,000 per month for office space and general administrative services.

        TheSponsor, executive officers and directors, or any of their respective affiliates, will be reimbursed for any out-of-pocket expenses incurred in connection with activities on theCompany's behalf such as identifying potential target businesses and performing due diligence on suitable business combinations. VectoIQ's audit committee reviewed on a quarterly basis all paymentsthat were made to the Sponsor, officers, directors or their affiliates and will determine which expenses and the amount of expenses that will be reimbursed. There was no cap or ceiling on thereimbursement of out-of-pocket expenses incurred by such persons in connection with activities on VectoIQ's behalf.

Subscription Agreements

        On June 3, 2020, the Subscribers purchased from the Company an aggregate of 52,500,000 shares of Common Stock, for a purchase price of$10.00 per share and an aggregate purchase price of $525.0 million, pursuant to Subscription Agreements entered into effective as of March 2, 2020. Pursuant to the SubscriptionAgreements, the Company gave certain registration rights to the Subscribers with respect to the PIPE Shares. The sale of PIPE Shares was consummated concurrently with the Closing.

        Forfurther information regarding transactions between us and the Selling Securityholders, see the section entitled "Certain Relationships and Related PartyTransactions."

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DESCRIPTION OF OUR SECURITIES

        The following summary of the material terms of our securities is not intended to be a complete summary of the rights andpreferences of such securities, and is qualified by reference to the Certificate of Incorporation, the Bylaws and the warrant-related documents described herein, which are exhibits to the registrationstatement of which this prospectus is a part. We urge to you reach each of the Certificate of Incorporation, the Bylaws and the warrant-related documents described herein in their entirety for acomplete description of the rights and preferences of our securities.

Authorized and Outstanding Stock

        The Certificate of Incorporation authorizes the issuance of 600,000,000 shares of Common Stock, $0.0001 par value per share and 150,000,000shares of undesignated preferred stock, $0.0001 par value per share. As of June 3, 2020, there were approximately 360,904,478 shares of Common Stock and no shares of preferred stockoutstanding. The outstanding shares of Common Stock are duly authorized, validly issued, fully paid and non-assessable.

Common Stock

Voting Power

        Except as otherwise required by law or as otherwise provided in any certificate of designation for any series of preferred stock, the holders ofCommon Stock possess all voting power for the election of our directors and all other matters requiring stockholder action. Holders of Common Stock are entitled to one vote per share on matters to bevoted on by stockholders.

Dividends

        Holders of Common Stock will be entitled to receive such dividends, if any, as may be declared from time to time by the Board in its discretionout of funds legally available therefor. In no event will any stock dividends or stock splits or combinations of stock be declared or made on Common Stock unless the shares of Common Stock at the timeoutstanding are treated equally and identically. We have not paid any cash dividends on the Common Stock to date. We may retain future earnings, if any, for future operations, expansion and debtrepayment and have no current plans to pay cash dividends for the foreseeable future. Any decision to declare and pay dividends in the future will be made at the discretion of the Board and willdepend on, among other things, our results of operations, financial condition, cash requirements, contractual restrictions and other factors that theBoard may deem relevant. In addition, our ability to pay dividends may be limited by covenants of any existing and future outstanding indebtedness we or our subsidiaries incur.

Liquidation, Dissolution and Winding Up

        In the event of our voluntary or involuntary liquidation, dissolution, distribution of assets or winding-up, the holders of the Common Stockwill be entitled to receive an equal amount per share of all of our assets of whatever kind available for distribution to stockholders, after the rights of the holders of the preferred stock have beensatisfied.

Preemptive or Other Rights

        Our stockholders have no preemptive or other subscription rights and there are no sinking fund or redemption provisions applicable to CommonStock.

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Election of Directors

        The Board is divided into three classes, each of which will generally serve for a term of three years with only one class of directors beingelected in each year. There is no cumulative voting with respect to the election of directors, with the result that the holders of more than 50% of the shares voted for the election of directors canelect all of the directors.

Preferred Stock

        The Certificate of Incorporation provides, that shares of preferred stock may be issued from time to time in one or more series. The Board isauthorized to fix the voting rights, if any, designations, powers and preferences, the relative, participating, optional or other special rights, and any qualifications, limitations and restrictionsthereof, applicable to the shares of each series of preferred stock. The Board is able to, without stockholder approval, issue preferred stock with voting and other rights that could adversely affectthe voting power and other rights of the holders of the Common Stock and could have anti-takeover effects. The ability of our board of directors to issue preferred stock without stockholder approvalcould have the effect of delaying, deferring or preventing a change of control of Nikola or the removal of existing management.

Warrants

        As of June 3, 2020, there were 23,890,000 Warrants to purchase Common Stock outstanding, consisting of 23,000,000 Public Warrants and890,000 Private Warrants held by VectoIQ's Founders. Each Warrant entitles the registered holder to purchase one share of Common Stock at a price of $11.50 per share, subject to adjustment asdiscussed below, at any time commencing 30 days after the completion of our initial business combination. The Warrants will expire at 5:00 p.m., New York City time, June 3, 2025or earlier upon their redemption or our liquidation, except that any Private Warrants issued to Cowen Investments will expire on May 15, 2023.

        Holdersof our Public Warrants cannot pay cash to exercise of their Public Warrants unless we have an effective and current registration statement covering the issuance of the sharesunderlying such Warrants and a current prospectus relating thereto. Notwithstanding the foregoing, if a registration statement covering the issuance of the shares issuable upon exercise of the PublicWarrants is not effective within 90 days from the closing of our initial business combination, Warrant holders may, until such time as there is an effective registration statement and duringany period when we shall have failed to maintain an effective registration statement or a current prospectus, exercise Warrants on a cashless basis pursuant to an available exemption from registrationunder the Securities Act. If an exemption from registration is not available, holders will not be able to exercise their Warrants on a cashless basis. In no event will we be required to net cashsettle any Warrant, or issue securities or other compensation in exchange for the Warrants in the event that we are unable to register or qualify the shares underlying the Warrants under theSecurities Act or applicable state securities laws.

        ThePrivate Warrants are identical to the Public Warrants underlying the VectoIQ Units sold in the IPO except that such Private Warrants will be exercisable for cash (even if aregistration statement covering the issuance of the Warrant shares issuable upon exercise of such Warrants is not effective) or on a cashless basis, at the holder's option, and will not be redeemableby us, in each case so long asthey are still held by our Founders or their affiliates and except that, as described above, any Private Warrants issued to Cowen Investments will have an earlier expiration date.

        Oncethe Warrants become exercisable, we may redeem the outstanding Warrants (excluding the Private Warrants):

•

in whole and not in part;



•

at a price of $0.01 per Warrant;

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•

upon a minimum of 30 days' prior written notice of redemption, which we refer to as the 30-day redemption period; and



•

if, and only if, the last reported sale price of Common Stock equals or exceeds $18.00 per share (as adjusted for stock splits, stockdividends, reorganizations, recapitalizations and the like) for any 20 trading days within a 30-trading day period ending on the third trading day prior to the date on which we send the notice ofredemption to the Public Warrant holders.

        Wewill not redeem the Public Warrants unless a registration statement under the Securities Act covering the issuance of the Public Warrant shares underlying the Public Warrants to be soredeemed is then effective and a current prospectus relating to those Public Warrant shares is available throughout the 30-day redemption period, except if the Public Warrants may be exercised on acashless basis and such cashless exercise is exempt from registration under the Securities Act. If and when the PublicWarrants become redeemable by us, we may exercise our redemption right even if we are unable to register or qualify the underlying securities for sale under all applicable state securities laws.

        Ifthe foregoing conditions are satisfied and we issue a notice of redemption, each Public Warrant holder may exercise his, her or its Public Warrants prior to the scheduled redemptiondate. However, the price of the shares of Common Stock may fall below the $18.00 trigger price (as adjusted) as well as the $11.50 exercise price (as adjusted) after the redemption notice is issued.

        Ifwe call the Public Warrants for redemption as described above, our management will have the option to require all holders that wish to exercise Warrants to do so on a "cashlessbasis." In making such determination, our management will consider, among other factors, our cash position, the number of Warrants that are outstanding and the dilutive effect on our stockholders ofissuing the maximum number of Warrant shares issuable upon exercise of outstanding Warrants. In such event, the holder would pay the exercise price by surrendering the Warrants for that number ofshares of Common Stock equal to the quotient obtained by dividing (x) the product of the number of Warrant shares underlying the Warrants to be so exercised, and the difference between theexercise price of the Warrants and the fair market value by (y) the fair market value.

        TheWarrants are issued under and subject to the terms of the Warrant Agreement between Continental Stock Transfer & Trust Company, as warrant agent, and us.

Lock-Up Restrictions

        Certain of our stockholders are subject to certain restrictions on transfer until the termination of applicable lock-up periods. See the sectionentitled "Selling Securityholders—Certain Relationships with Selling Securityholders" for lock-up restrictions on our securities under theRegistration Rights and Lock-Up Agreement and the Lock-Up Agreements.

Certain Anti-Takeover Provisions of Delaware Law

Special Meetings of Stockholders

        The Certificate of Incorporation provides that special meetings of our stockholders may be called by such persons as provided in the Bylaws. TheBylaws provide that special meetings of our stockholders may be called only by (i) a majority vote of our board of directors, (ii) our Secretary, at the request of our Chairman,(iii) our Executive Chairman, or (iv) the vote of the stockholders owning not less than twenty-five percent of our issued and outstanding stock; provided that our board of directorsapproves such stockholder request for a special meeting.

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Advance Notice Requirements for Stockholder Proposals and Director Nominations

        Our current bylaws provide that stockholders seeking to bring business before our annual meeting of stockholders, or to nominate candidates forelection as directors at our annual meeting of stockholders, must provide timely notice of their intent in writing. To be timely under the Bylaws, a stockholder's notice will need to be received bythe company secretary at our principal executive offices not later than the close of business on the 90th day nor earlier than the open of business on the 120th day prior the anniversaryof the date of our proxy statement provided in connection with the previous year's annual meeting of stockholders; provided, however, that in the event that no annual meeting was held in the previousyear or the annual meeting is called for a date that is more than 30 days before or after the anniversary date of the previous year's annual meeting, notice by the stockholder must be receivedby the secretary no later than the close of business on the latter of the 90th day prior to such annual meeting and the 10th day following the day on which public announcement of thedate of such meeting is first made. The Certificate of Incorporation and the Bylaws specify certain requirements as to the form and content of a stockholders' meeting. These provisions may precludeour stockholders from bringing matters before our annual meeting of stockholders or from making nominations for directors at our annual meeting of stockholders.

Authorized but Unissued Shares

        Our authorized but unissued Common Stock and preferred stock are available for future issuances without stockholder approval and could beutilized for a variety of corporate purposes, including future offerings to raise additional capital, acquisitions and employee benefit plans. The existence of authorized but unissued and unreservedCommon Stock and preferred stock could render more difficult or discourage an attempt to obtain control of us by means of a proxy contest, tender offer, merger or otherwise.

Exclusive Forum Selection

        The Certificate of Incorporation requires, to the fullest extent permitted by law, that derivative actions brought in our name, actions againstdirectors, officers and employees for breach of fiduciary duty and other similar actions be brought in the Court of Chancery in the State of Delaware or, if that court lacks subject matterjurisdiction, another federal or state court situated in the State of Delaware. Any person or entity purchasing or otherwise acquiring any interest in shares of our capital stock shall be deemed tohave notice of and consented to the forum provisions in the Certificate of Incorporation. The Certificate of Incorporation also requires the federal district courts of the United States shall be theexclusive forum for the resolution of any complaint asserting a cause of action under the Securities Act and the Exchange Act, and the stockholder bringing the suit will be deemed to have to serviceof process on such stockholder's counsel. Although we believe these provisions benefit us by providing increased consistency in the application of Delaware law in the types of lawsuits to which itapplies, a court may determine that these provisions are unenforceable, and to the extent they are enforceable, the provisions may have the effect of discouraging lawsuits against our directors andofficers, although our stockholders will not be deemed to have waived our compliance with federal securities laws and the rules and regulations thereunder.

Section 203 of the Delaware General Corporation Law

        We do not opt out of Section 203 of the DGCL under the Certificate of Incorporation.

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Limitation on Liability and Indemnification of Directors and Officers

        The Certificate of Incorporation limits our directors' liability to the fullest extent permitted under the DGCL. The DGCL provides thatdirectors of a corporation will not be personally liable for monetary damages for breach of their fiduciary duties as directors, except for liability:

•

for any transaction from which the director derives an improper personal benefit;



•

for any act or omission not in good faith or that involves intentional misconduct or a knowing violation of law;



•

for any unlawful payment of dividends or redemption of shares; or



•

for any breach of a director's duty of loyalty to the corporation or its stockholders.

        Ifthe DGCL is amended to authorize corporate action further eliminating or limiting the personal liability of directors, then the liability of the Company's directors will be eliminatedor limited to the fullest extent permitted by the DGCL, as so amended.

        Delawarelaw and the Certificate of Incorporation provide that the Company will, in certain situations, indemnify its directors and officers and may indemnify other employees and otheragents, to the fullest extent permitted by law. Any indemnified person is also entitled, subject to certain limitations, to advancement, direct payment, or reimbursement of reasonable expenses(including attorneys' fees and disbursements) in advance of the final disposition of the proceeding.

        Inaddition, the Company has entered into separate indemnification agreements with its directors and officers. These agreements, among other things, require the Company to indemnify itsdirectors and officers for certain expenses, including attorneys' fees, judgments, fines, and settlement amounts incurred by a director or officer in any action or proceeding arising out of theirservices as one of the Company's directors or officers or any other company or enterprise to which the person provides services at the Company's request.

        TheCompany plans to maintain a directors' and officers' insurance policy pursuant to which its directors and officers are insured against liability for actions taken in their capacitiesas directors and officers. We believe these provisions in the Certificate of Incorporation and the Bylaws and these indemnification agreements are necessary to attract and retain qualified persons asdirectors and officers.

        Insofaras indemnification for liabilities arising under the Securities Act may be permitted to directors, officers, or control persons, in the opinion of the SEC, such indemnificationis against public policy as expressed in the Securities Act and is therefore unenforceable.

Rule 144

        Rule 144 is not available for the resale of securities initially issued by shell companies (other than business combination related shellcompanies) or issuers that have been at any time previously a shell company, such as the Company. However, Rule 144 also includes an important exception to this prohibition if the followingconditions are met:

•

the issuer of the securities that was formerly a shell company has ceased to be a shell company;



•

the issuer of the securities is subject to the reporting requirements of Section 13 or 15(d) of the Exchange Act;



•

the issuer of the securities has filed all Exchange Act reports and material required to be filed, as applicable, during the preceding12 months (or such shorter period that the issuer was required to file such reports and materials), other than Form 8-K reports; and

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•

at least one year has elapsed from the time that the issuer filed current Form 10 type information with the SEC reflecting its status asan entity that is not a shell company.

        Uponthe Closing, the Company ceased to be a shell company.

        Whenand if Rule 144 becomes available for the resale of our securities, a person who has beneficially owned restricted shares of our Common Stock or Warrants for at least sixmonths would be entitled to sell their securities, provided that (i) such person is not deemed to have been one of our affiliates at the time of, or at any time during the three monthspreceding, a sale and (ii) we are subject to the Exchange Act periodic reporting requirements for at least three months before the sale and have filed all required reports underSection 13 or 15(d) of the Exchange Act during the 12 months (or such shorter period as we were required to file reports) preceding the sale.

        Personswho have beneficially owned restricted shares of our Common Stock or Warrants for at least six months but who are our affiliates at the time of, or at any time during the threemonths preceding, a sale, would be subject to additional restrictions, by which such person would be entitled to sell within any three-month period only a number of securities that does not exceed thegreater of:

•

one percent (1%) of the total number of shares of Common Stock then outstanding; or



•

the average weekly reported trading volume of the Common Stock during the four calendar weeks preceding the filing of a notice onForm 144 with respect to the sale.

        Salesby our affiliates under Rule 144 will also be limited by manner of sale provisions and notice requirements and to the availability of current public information about us.

Transfer Agent, Warrant Agent and Registrar

        The transfer agent, warrant agent and registrar for our Common Stock and Warrants is Continental Stock Transfer & Trust Company.

Listing of Securities

        Our Common Stock and Public Warrants are listed on the Nasdaq Global Select Market under the symbols "NKLA" and "NKLAW," respectively.

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PLAN OF DISTRIBUTION

        We are registering the resale by the Selling Securityholders or their permitted transferees from time to time of up to 249,843,711 shares ofCommon Stock, which includes (i) up to 6,640,000 shares held by the Original Holders and (ii) 243,203,711 shares held by certain affiliates of the Company.

        Weare required to pay all fees and expenses incident to the registration of the shares of our Common Stock to be offered and sold pursuant to this prospectus.

        Wewill not receive any of the proceeds from the sale of the securities by the Selling Securityholders. The aggregate proceeds to the Selling Securityholders will be the purchase priceof the securities less any discounts and commissions borne by the Selling Securityholders. The shares of Common Stockbeneficially owned by the Selling Securityholders covered by this prospectus may be offered and sold from time to time by the Selling Securityholders. The term "Selling Securityholders" includesdonees, pledgees, transferees or other successors in interest selling securities received after the date of this prospectus from a Selling Securityholder as a gift, pledge, partnership distribution orother transfer. The Selling Securityholders will act independently of us in making decisions with respect to the timing, manner and size of each sale. Such sales may be made on one or more exchangesor in the over-the-counter market or otherwise, at prices and under terms then prevailing or at prices related to the then current market price or in negotiated transactions. The SellingSecurityholders may sell their shares by one or more of, or a combination of, the following methods:

•

purchases by a broker-dealer as principal and resale by such broker-dealer for its own account pursuant to this prospectus;



•

ordinary brokerage transactions and transactions in which the broker solicits purchasers;



•

block trades in which the broker-dealer so engaged will attempt to sell the shares as agent but may position and resell a portion of the blockas principal to facilitate the transaction;



•

an over-the-counter distribution in accordance with the rules of Nasdaq;



•

through trading plans entered into by a Selling Securityholder pursuant to Rule 10b5-1 under the Exchange Act, that are in place at thetime of an offering pursuant to this prospectus and any applicable prospectus supplement hereto that provide for periodic sales of their securities on the basis of parameters described in such tradingplans;



•

to or through underwriters or broker-dealers;



•

in "at the market" offerings, as defined in Rule 415 under the Securities Act, at negotiated prices, at prices prevailing at the time ofsale or at prices related to such prevailing market prices, including sales made directly on a national securities exchange or sales made through a market maker other than on an exchange or othersimilar offerings through sales agents;



•

in privately negotiated transactions;



•

in options transactions;



•

pursuant to the Founder Stock Option Plan;



•

through a combination of any of the above methods of sale; or



•

any other method permitted pursuant to applicable law.

        Inaddition, any shares that qualify for sale pursuant to Rule 144 may be sold under Rule 144 rather than pursuant to this prospectus.

        Tothe extent required, this prospectus may be amended or supplemented from time to time to describe a specific plan of distribution. In connection with distributions of the shares orotherwise, the

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SellingSecurityholders may enter into hedging transactions with broker-dealers or other financial institutions. In connection with such transactions, broker-dealers or other financial institutionsmay engage in short sales of shares of Common Stock in the course of hedging transactions, broker-dealers or other financial institutions may engage in short sales of shares of Common Stock in thecourse of hedging the positions they assume with Selling Securityholders. The Selling Securityholders may also sell shares of Common Stock short and redeliver the shares to close out such shortpositions. The Selling Securityholders may also enter into option or other transactions with broker-dealers or other financial institutions which require the delivery to such broker-dealer or otherfinancial institution of shares offered by this prospectus, which shares such broker-dealer or other financial institution may resell pursuant to this prospectus (as supplemented or amended to reflectsuch transaction). The Selling Securityholders may also pledge shares to a broker-dealer or other financial institution, and, upon a default, such broker-dealer or other financial institution, mayeffect sales of the pledged shares pursuant to this prospectus (as supplemented or amended to reflect such transaction).

        ASelling Securityholder may enter into derivative transactions with third parties, or sell securities not covered by this prospectus to third parties in privately negotiatedtransactions. If the applicable prospectus supplement indicates, in connection with those derivatives, the third parties may sell securities covered by this prospectus and the applicable prospectussupplement, including in short sale transactions. If so, the third party may use securities pledged by any Selling Securityholder or borrowed from any Selling Securityholder or others to settle thosesales or to close out any related open borrowings of stock, and may use securities received from any Selling Securityholder in settlement of those derivatives to close out any related open borrowingsof stock. The third party in such sale transactions will be an underwriter and will be identified in the applicable prospectus supplement (or a post-effective amendment). In addition, any SellingSecurityholder may otherwise loan or pledge securities to a financial institution or other third party that in turn may sell the securities short using this prospectus. Such financial institution orother third party may transfer its economic short position to investors in our securities or in connection with a concurrent offering of other securities.

        Ineffecting sales, broker-dealers or agents engaged by the Selling Securityholders may arrange for other broker-dealers to participate. Broker-dealers or agents may receive commissions,discounts or concessions from the Selling Securityholders in amounts to be negotiated immediately prior to the sale.

        Inoffering the shares covered by this prospectus, the Selling Securityholders and any broker-dealers who execute sales for the Selling Securityholders may be deemed to be "underwriters"within the meaning of the Securities Act in connection with such sales. Any profits realized by the Selling Securityholders and the compensation of any broker-dealer may be deemed to be underwritingdiscounts and commissions.

        Inorder to comply with the securities laws of certain states, if applicable, the shares must be sold in such jurisdictions only through registered or licensed brokers or dealers. Inaddition, in certain states the shares may not be sold unless they have been registered or qualified for sale in the applicable state or an exemption from the registration or qualification requirementis available and is complied with.

        Wehave advised the Selling Securityholders that the anti-manipulation rules of Regulation M under the Exchange Act may apply to sales of shares in the market and to theactivities of the Selling Securityholders and their affiliates. In addition, we will make copies of this prospectus available to the Selling Securityholders for the purpose of satisfying theprospectus delivery requirements of the Securities Act. The Selling Securityholders may indemnify any broker-dealer that participates in transactions involving the sale of the shares against certainliabilities, including liabilities arising under the Securities Act.

        Atthe time a particular offer of shares is made, if required, a prospectus supplement will be distributed that will set forth the number of shares being offered and the terms of theoffering, including the name of any underwriter, dealer or agent, the purchase price paid by any underwriter, any discount, commission and other item constituting compensation, any discount,commission or concession allowed or reallowed or paid to any dealer, and the proposed selling price to the public.

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MATERIAL UNITED STATES FEDERAL INCOME TAX CONSEQUENCES TO NON-U.S. HOLDERS

        The following is a summary of the material United States federal income tax consequences of the purchase, ownership and disposition of ourCommon Stock purchased in this offering by a non-U.S. holder (as defined below). This summary does not address all aspects of U.S. federal income tax consequences relating thereto. This summary alsodoes not address the tax considerations arising under the laws of any non-U.S., state or local jurisdiction, nor under U.S. federal gift and estate tax laws, except to the limited extent providedbelow. In general, a "non-U.S. holder" means a beneficial owner of our Common Stock (other than an entity treated as a partnership for United States federal income tax purposes) that is not, forUnited States federal income tax purposes, any of the following:

•

an individual citizen or resident of the United States;



•

a corporation (or any other entity treated as a corporation for United States federal income tax purposes) created or organized in or under thelaws of the United States, any state thereof or the District of Columbia;



•

an estate the income of which is subject to United States federal income taxation regardless of its source; or



•

a trust if it (1) is subject to the primary supervision of a court within the United States and one or more United States persons havethe authority to control all substantial decisions of the trust or (2) has a valid election in effect under applicable United States Treasury regulations to be treated as a United Statesperson.

        Thissummary is based upon provisions of the Internal Revenue Code of 1986, as amended (the "Code"), and regulations, rulings and judicial decisions as of the date hereof. Thoseauthorities are subject to different interpretations and may be changed, perhaps retroactively, so as to result in tax consequences different from those summarized below. The remainder of this summaryassumes that a non-U.S. holder holds shares of our Common Stock as a capital asset within the meaning of Section 1221 of the Code (generally, property held for investment).This summary does notaddress all aspects of United States federal income tax consequences that may be relevant to non-U.S. holders in light of their particular circumstances, nor does it address any estate or gift taxconsequences, except to the limited extent provided below, or any aspects of U.S. state, local or non-U.S. taxes. In addition, it does not represent a detailed description of the United States federalincome tax consequences applicable to you if you are subject to special treatment under the United States federal income tax laws (including if you are a United States expatriate, foreign pensionfund, financial institution, insurance company, tax-exempt organization, trader, broker or dealer in securities, commodities or currencies, "controlled foreign corporation," "passive foreigninvestment company," partnership or other pass-through entity for United States federal income tax purposes (or an investor in such a pass-through entity), person who acquired shares of our CommonStock as compensation or otherwise in connection with the performance of services, person that owns, or is deemed to own, more than 5% of our capital stock (except to the extent specifically set forthbelow), person using the accrual method of tax accounting subject to special tax rules under Section 451(b) of the Code, or person who has acquired shares of our Common Stock as part of astraddle, hedge, conversion transaction or other integrated investment). We cannot assure you that a change in law will not alter significantly the tax consequences that we describe in this summary.

        Ifa partnership (or other entity treated as a partnership for United States federal income tax purposes) holds our Common Stock, the tax treatment of a partner will generally dependupon the status of the partner and the activities of the partnership. If you are a partner of a partnership holding our Common Stock, you should consult your tax advisors.

        Ifyou are considering the purchase of our Common Stock, you should consult your own tax advisors concerning the particular United States federal income taxconsequences to you of the

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purchase, ownership and disposition of our Common Stock, as well as the consequences to you arising under other United States federal tax laws and the laws of any other taxingjurisdiction.

Dividends

        In the event that we make a distribution of cash or other property (other than certain pro rata distributions of our stock) in respect of ourCommon Stock, the distribution generally will be treated as a dividend for United States federal income tax purposes to the extent it is paid from our current or accumulated earnings and profits, asdetermined under United States federal income tax principles. Any portion of a distribution that exceeds our current and accumulated earnings and profits generally will be treated first as a tax-freereturn of capital, causing a reduction in the adjusted tax basis of a non-U.S. holder's Common Stock, and to the extent the amount of the distribution exceeds a non-U.S. holder's adjusted tax basis inour Common Stock, the excess will be treated as gain from the disposition of our Common Stock (the tax treatment of which is discussed below under "—Gain on Disposition of Common Stock").Any such distribution will also be subject to the discussion below under the heading "Additional Withholding Requirements."

        Dividendspaid to a non-U.S. holder generally will be subject to withholding of United States federal income tax at a 30% rate or such lower rate as may be specified by an applicableincome tax treaty. However, dividends that are effectively connected with the conduct of a trade or business by the non-U.S. holder within the United States (and, if required by an applicable incometax treaty, are attributable to a United States permanent establishment) are not subject to the withholding tax, provided certain certification and disclosure requirements are satisfied. Instead, suchdividends are subject to United States federal income tax on a net income basis in the same manner as if the non-U.S. holder were a United States person as defined under the Code. Any such effectivelyconnected dividends received by a foreign corporation may be subject to an additional "branch profits tax" at a 30% rate or such lower rate as may be specified by an applicable income tax treaty.

        Anon-U.S. holder who wishes to claim the benefit of an applicable treaty rate and avoid backup withholding, as discussed below, for dividends will be required (a) to provide theapplicable withholding agent with a properly executed Internal Revenue Service ("IRS") Form W-BEN or Form W-8BEN-E (or other applicable form) certifying under penalty of perjury thatsuch holder is not a United States person as defined under the Code and is eligible for treaty benefits or (b) if our Common Stock is held through certain foreign intermediaries, to satisfy therelevant certification requirements of applicable United States Treasury regulations. Special certification and other requirements apply to certain non-U.S. holders that are pass-through entitiesrather than corporations or individuals.

        Anon-U.S. holder eligible for a reduced rate of United States federal withholding tax pursuant to an income tax treaty may obtain a refund of any excess amounts withheld by timelyfiling an appropriate claim for refund with the IRS.

Gain on Disposition of Common Stock

        Subject to the discussion of backup withholding below, any gain realized by a non-U.S. holder on the sale or other disposition of our CommonStock generally will not be subject to United States federal income tax unless:

•

the gain is effectively connected with a trade or business of the non-U.S. holder in the United States (and, if required by an applicableincome tax treaty, is attributable to a United States permanent establishment of the non-U.S. holder);



•

the non-U.S. holder is an individual who is present in the United States for 183 days or more in the taxable year of that disposition,and certain other conditions are met; or

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•

we are or have been, at any time during the five-year period preceding such disposition (or the non-U.S. holder's holding period, if shorter) a"United States real property holding corporation" for United States federal income tax purposes and certain other conditions are met.

        Anon-U.S. holder described in the first bullet point immediately above will be subject to tax on the gain derived from the sale or other disposition in the same manner as if thenon-U.S. holder were a United States person as defined under the Code. In addition, if any non-U.S. holder described in the first bullet point immediately above is a foreign corporation, the gainrealized by such non-U.S. holder may be subject to an additional "branch profits tax" at a 30% rate or such lower rate as may be specified by an applicable income tax treaty. An individual non-U.S.holder described in the second bullet point immediately above will be subject to a 30% (or such lower rate as may be specified by an applicable income tax treaty) tax on the gain derived from the saleor other disposition, which gain may be offset by United States source capital losses even though the individual is not considered a resident of the United States.

        Generally,a corporation is a "United States real property holding corporation" if the fair market value of its United States real property interests equals or exceeds 50% of the sum ofthe fair market value of its worldwide real property interests and its other assets used or held for use in a trade or business (all as determined for United States federal income tax purposes). Webelieve we are not and do not anticipate becoming a "United States real property holding corporation" for United States federal income tax purposes. Even if we are or become a United States realproperty holding corporation, provided that our Common Stock is regularly traded on an established securities market, within the meaning of applicable Treasury regulations, our Common Stock will betreated as a U.S. real property interest only with respect to a non-U.S. holder that holds more than 5% of our outstanding Common Stock, directly or indirectly, actually or constructively, during theshorter of the 5-year period ending on the date of the disposition or the period that the non-U.S. holder held our Common Stock. In such case, such non-U.S. holder generally will be taxed on its netgain derived from the disposition at the graduated U.S. federal income tax rates applicable to U.S. persons (as defined in the Code). No assurance can be provided that our Common Stock will beconsidered to be regularly traded on an established securities market for purposes of the rules described above.

Federal Estate Tax

        The estates of nonresident alien individuals generally are subject to U.S. federal estate tax on property with a U.S. situs. Because we are aU.S. corporation, our Common Stock will be U.S.-situs property and therefore will be included in the taxable estate of a nonresident alien decedent, unless an applicable estate tax treaty between theUnited States and the decedent's country ofresidence provides otherwise. Investors are urged to consult their own tax advisors regarding the U.S. federal estate tax consequences of the ownership or disposition of our Common Stock.

Information Reporting and Backup Withholding

        Distributions paid to a non-U.S. holder and the amount of any tax withheld with respect to such distributions generally will be reported to theIRS. Copies of the information returns reporting such distributions and any withholding may also be made available to the tax authorities in the country in which the non-U.S. holder resides under theprovisions of an applicable income tax treaty.

        Anon-U.S. holder will not be subject to backup withholding on dividends received if such holder certifies under penalty of perjury that it is a non-U.S. holder (and the payor does nothave actual knowledge or reason to know that such holder is a United States person as defined under the Code), or such holder otherwise establishes an exemption.

        Informationreporting and, depending on the circumstances, backup withholding will apply to the proceeds of a sale or other disposition of our Common Stock made within the United Statesor

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conductedthrough certain United States-related financial intermediaries, unless the beneficial owner certifies under penalty of perjury that it is a non-U.S. holder (and the payor does not haveactual knowledge or reason to know that the beneficial owner is a United States person as defined under the Code), or such owner otherwise establishes an exemption.

        Backupwithholding is not an additional tax and any amounts withheld under the backup withholding rules will be allowed as a refund or a credit against a non-U.S. holder's United Statesfederal income tax liability provided the required information is timely furnished to the IRS.

Additional Withholding Requirements

        Under Sections 1471 through 1474 of the Code (such Sections commonly referred to as "FATCA"), a 30% United States federal withholding taxmay apply to any dividends paid on our Common Stock paid to (i) a "foreign financial institution" (as specifically defined in the Code) which does not provide sufficient documentation,typically on IRS Form W-8BEN-E, evidencing either (x) an exemption from FATCA, or (y) its compliance (or deemed compliance) with FATCA (which may alternatively be in the form ofcompliance with an intergovernmental agreement with the United States) in a manner which avoids withholding, or (ii) a "non-financial foreign entity" (as specifically defined in the Code) whichdoes not provide sufficient documentation, typically on IRS Form W-8BEN-E, evidencing either (x) an exemption from FATCA, or (y) adequate information regarding certain substantialUnited States beneficial owners of such entity (if any). If a dividend payment is both subject to withholding under FATCA and subject to the withholding tax discussed above under"—Dividends," the withholding under FATCA may be credited against, and therefore reduce, such other withholding tax. You should consult your own tax advisors regarding these requirementsand whether they may be relevant to your ownership and disposition of our Common Stock.

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LEGAL MATTERS

        The validity of Common Stock offered by this prospectus will be passed upon for us by Pillsbury Winthrop Shaw Pittman LLP.

EXPERTS

        The consolidated financial statements of Nikola Corporation (f/k/a VectoIQ Acquisition Corp.) at December 31, 2019 and 2018, and for eachof the three years in the period ended December 31, 2019, included in this Prospectus and Registration Statement have been audited byErnst & Young LLP, independent registered public accounting firm, as set forth in their report appearing elsewhere herein, and are included in reliance upon such report given on theauthority of such firm as experts in accounting and auditing.

        Thefinancial statements as of December 31, 2019 and 2018, for the year ended December 31, 2019 the period from January 23, 2018 (inception) to December 31,2018 of VectoIQ Acquisition Corp. appearing in this prospectus and registration statement have been audited by RSM US LLP, an independent registered public accounting firm, as stated in theirreport thereon and included in this prospectus and registration statement, in reliance upon such report and upon the authority of such firm as experts in accounting and auditing.

CHANGE IN AUDITOR

        On June 3, 2020, the Board approved the engagement of Ernst & Young LLP ("EY") as the Company's independent registeredpublic accounting firm to audit the Company's consolidated financial statements for the year ending December 31, 2020. EY served as the independent registered public accounting firm of LegacyNikola prior to the Business Combination. Accordingly, RSM US LLP ("RSM"), the Company's independent registered public accounting firm prior to the Business Combination, was informed that itwould be replaced by EY as the Company's independent registered public accounting firm following completion of the Company's audit for the year ended December 31, 2019, which consists only ofthe accounts of the pre-business combination special purpose acquisition company.

        RSM'sreport on the Company's balance sheets as of December 31, 2019 and 2018, the related statements of operations, stockholders' equity and cash flows for the year endedDecember 31, 2019 and for the period from January 23, 2018 (inception) to December 31, 2018, and the related notes to the financial statements (collectively, the "financialstatements") did not contain any adverse opinion or disclaimer of opinion, nor were they qualified or modified as to uncertainty, audit scope or accounting principles.

        Duringthe period from January 23, 2018 (inception) to December 31, 2019 and the subsequent period through March 31, 2020, there were no: (i) disagreementswith RSM on any matter of accounting principles or practices, financial statement disclosures or audited scope or procedures, which disagreements if not resolved to RSM's satisfaction would havecaused RSM to make reference to the subject matter of the disagreement in connection with its report or (ii) reportable events as defined in Item 304(a)(1)(v) of Regulation S-K.

        Duringthe period from January 23, 2018 (inception) to December 31, 2018, and the interim period through March 31, 2020, the Company did not consult EY with respectto either (i) the application of accounting principles to a specified transaction, either completed or proposed; or the type of auditopinion that might be rendered on the Company's financial statements, and no written report or oral advice was provided to the Company by EY that EY concluded was an important factor considered by theCompany in reaching a decision as to the accounting, auditing or financial reporting issue; or (ii) any matter that was either the subject of a disagreement, as that term is described in

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Item 304(a)(1)(iv)of Regulation S-K under the Exchange Act and the related instructions to Item 304 of Regulation S-K under the Exchange Act, or a reportable event, asthat term is defined in Item 304(a)(1)(v) of Regulation S-K under the Exchange Act.

        TheCompany has provided RSM with a copy of the disclosures made by the Company in response to Item 304(a) of Regulation S-K under the Exchange Act, and has requested thatRSM furnish the Company with a letter addressed to the SEC stating whether it agrees with the statements made by the registrant in response to this Item 304(a) of Regulation S-K underthe Exchange Act and, if not, stating the respects in which it does not agree. A letter from RSM is attached hereto as Exhibit 16.1.

WHERE YOU CAN FIND MORE INFORMATION

        We are required to file annual, quarterly and current reports, proxy statements and other information with the SEC as required by the ExchangeAct. You can read Nikola's SEC filings, including this prospectus, over the Internet at the SEC's website at http://www.sec.gov.

        Ourwebsite address is www.nikolamotor.com. Through our website, we make available, free of charge, the following documents as soon as reasonably practicable after they areelectronically filed with, or furnished to, the SEC, including our Annual Reports on Form 10-K; our proxy statements for our annual and special stockholder meetings; our Quarterly Reports onForm 10-Q; our Current Reports on Form 8-K; Forms 3, 4, and 5 and Schedules 13D with respect to our securities filed on behalf of our directors and our executive officers;and amendments to those documents. The information contained on, or that may be accessed through, our website is not a part of, and is not incorporated into, this prospectus.

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INDEX TO FINANCIAL STATEMENTS

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NIKOLA CORPORATION

CONSOLIDATED BALANCE SHEETS

(In thousands, except share and per share data)

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NIKOLA CORPORATION

CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except share and per share data)

(Unaudited)

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NIKOLA CORPORATION
CONSOLIDATED STATEMENTS OF REDEEMABLE CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS' DEFICIT
(In thousands, except share data)
(Unaudited)

 

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NIKOLA CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)

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NIKOLA CORPORATION

Notes to Consolidated Financial Statements

(Unaudited)

1. BASIS OF PRESENTATION

(a)   Accounts and transactions have been eliminated.

        The accompanying consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles ("GAAP") and pursuant tothe 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 recurringadjustments, 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 periodpresented 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 historical auditedconsolidated financial statements of the Company as of and for the year ended December 31, 2019 and notes thereto included within this Registration Statement.

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

        Alldollar amounts are in thousands, unless otherwise noted. Share and per share amounts are presented on a post-conversion basis for all periods presented, unless otherwise specified.

(b)   Funding Risks and Going Concern

        Asan early stage growth company, Nikola's ability to access capital is critical. Management plans to raise additional capital through a combination of public equity, debt financings,strategic alliances, and licensing arrangements.

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

        TheCompany'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.

        Thesefinancial 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 therealization ofassets 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 thisuncertainty.

        Asof the date of this report, the Company's existing cash resources and existing borrowing availability are sufficient to support planned operations for the next 12 months. As aresult, management believes that its existing financial resources are sufficient to continue operating activities for at least one year past the issuance date of the financial statements.

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NIKOLA CORPORATION

Notes to Consolidated Financial Statements (Continued)

(Unaudited)

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

(a)   Comprehensive Loss

        Comprehensiveloss includes all changes in equity during a period from non-owner sources. Through March 31, 2020, there are no components of comprehensive loss which are notincluded in net loss; therefore, a separate statement of comprehensive loss has not been presented. The Company does not have any foreign currency translation adjustments as a component of othercomprehensive loss through March 31, 2020, as the functional currency of all subsidiaries is the U.S. Dollar.

(b)   Concentration of Credit Risk

        Financialinstruments that potentially subject the Company to concentrations of credit risk consist of cash, cash equivalents and accounts receivable. The Company's cash is placed withhigh-credit-quality financial institutions and issuers, and at times exceed federally insured limits. The Company limits its concentration of risk in cash equivalents by diversifying its investmentsamong a variety of industries and issuers. The Company has not experienced any credit loss relating to its cash equivalents.

(c)   Concentration of Supplier Risk

        TheCompany is not currently in the production stage and generally utilizes suppliers for outside development and engineering support. The Company does not consider any of its suppliesto be critical to its research and development activities and does not believe that there is any significant supplier concentration risk during the periods ended March 31, 2020 and 2019.

(d)   Cash, Cash Equivalents and Restricted Cash and Cash Equivalents

        TheCompany considers all highly liquid investments purchased with a remaining maturity of three months or less to be cash equivalents. Additionally, the Company considers investments inmoney market funds with a floating net asset value to be cash equivalents. As of March 31, 2020 and December 31, 2019, the Company had $75.5 million and $85.7 million ofcash and cash equivalents, which included cash equivalents of $73.0 million of highly liquid investments at March 31, 2020 and December 31, 2019.

        Asof March 31, 2020 and December 31, 2019, the Company had $4.1 million in an escrow account related to the securitization of the term loan. See Note 6"Debt" for additional information on the Company's term loan.

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NIKOLA CORPORATION

Notes to Consolidated Financial Statements (Continued)

(Unaudited)

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

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

(e)   Prepaid In-kind Services

        TheCompany issues CNH Industrial N.V. ("CNHI") shares of Series D redeemable convertible preferred stock in exchange for in-kind technical assistance services. When sharesare issued, the Company records prepaid in-kind services and amortizes the amount as services are received in research and development costs in the consolidated statement of operations.

(f)    Fair Value of Financial Instruments

        Thecarrying value and fair value of the Company's financial instruments are as follows:

 

        InSeptember 2019, the Company entered into an agreement that required the Company to issue and the investor to purchase Series D redeemable convertible preferred stock at a fixedprice in April 2020 (the "Forward Contract Liability"), which was accounted for as a liability. The liability was remeasured as of March 31, 2020 and the change in fair value was recognized inother income (expense) on the consolidated statements of operations. The Company settled the liability in April 2020

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NIKOLA CORPORATION

Notes to Consolidated Financial Statements (Continued)

(Unaudited)

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

withthe issuance of Series D redeemable convertible preferred stock. The change in fair value of the Forward Contract Liability was as follows:

        Indetermining the fair value of the Forward Contract Liability, estimates and assumptions impacting fair value included the estimated future value of the Company's Series Dredeemable convertible preferred stock, discount rates and estimated time to liquidity. The following reflects the significant quantitative inputs used:

(g)   Redeemable Convertible Preferred Stock

        TheCompany records shares of redeemable convertible preferred stock at their respective fair values on the dates of issuance, net of issuance costs. The redeemable convertible preferredstock is recorded outside of stockholders' deficit on the consolidated balance sheets because the shares contain liquidation features that are not solely within the Company's control. The Company haselected not to adjust the carrying values of the redeemable convertible preferred stock to the liquidation preferences of such shares because of the uncertainty of whether or when such an event wouldoccur. Subsequent adjustments to increase the carrying values to the liquidation preferences will be made only when it becomes probable that such a liquidation event will occur.

        OnJune 3, 2020, the Company and VectoIQ consummated the merger contemplated by that certain Business Combination Agreement, dated March 2, 2020, by and among the VectoIQ,and VCTIQ Merger Sub Corp., a wholly-owned subsidiary of VectoIQ incorporated in the State of Delaware (the "Business Combination"), with Nikola surviving the merger as a wholly-owned subsidiary ofVectoIQ. Immediately before the closing of the Business Combination, all shares of outstanding redeemable convertible preferred stock of the Company converted into shares of common stock of theCompany (see Note 12 "Subsequent Events").

(h)   Recent Accounting Pronouncements

        Asan emerging growth company ("EGC"), the Jumpstart Our Business Startups Act of 2012, as amended (the "JOBS Act"), allows the Company to delay adoption of new or revised accountingpronouncements applicable to public companies until such pronouncements are applicable to private

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NIKOLA CORPORATION

Notes to Consolidated Financial Statements (Continued)

(Unaudited)

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

companies.The Company elected to use this extended transition period under the JOBS Act until such time the Company is no longer considered to be an EGC. The adoption dates discussed below reflectthis election. Upon completion of the Business Combination in June 2020 (see Note 12 "Subsequent Events"), the Company expects to no longer qualify as an EGC and will revise the adoption datesaccordingly in subsequent filings.

        InFebruary 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standard Update ("ASU") 2016-02, Leases(Topic 842), to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing keyinformation about leasing arrangements. In July 2018, ASU 2018-10, Codification Improvements to Topic 842, Leases, was issued to provide moredetailed guidance and additional clarification for implementing ASU 2016-02. Furthermore, in July 2018, the FASB issued ASU 2018-11, Leases (Topic 842): TargetedImprovements, which provides an optional transition method in addition to the existing modified retrospective transition method by allowing a cumulative effect adjustment tothe opening balance of retained earnings in the period of adoption. These new leasing standards are effective for the Company beginning January 1, 2021, with early adoption permitted. TheCompany is currently evaluating the effect of the adoption of this guidance on the consolidated financial statements.

        InJune 2016, the FASB issued ASU 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses of FinancialInstruments, which, together with subsequent amendments, amends the requirement on the measurement and recognition of expected credit losses for financial assets held. ASU2016-13 is effective for the Company beginning January 1, 2023, with early adoption permitted. The Company is currently in the process of evaluating the effects of this pronouncement on theCompany's financial statements and does not expect it to have a material impact on the consolidated financial statements.

        InDecember 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes, which is intended tosimplify various aspects related to accounting for income taxes. The pronouncement is effective for fiscal years, and for interim periods within those fiscal years, beginning after December 15,2020, with early adoption permitted. ASU 2019-12 is effective for the Company beginning January 1, 2022, with early adoption permitted. The Company is currently in theprocess of evaluating the effects of this pronouncement on the Company's financial statements and does not expect it to have a material impact on the consolidated financial statements.

        InJanuary 2020, the FASB issued ASU No. 2020-01, Investments—Equity Securities (Topic 321), Investments—Equity Method and Joint Ventures (Topic 323), andDerivative and Hedging (Topic 815), which addresses accounting for the transition into and out of the equity method and provides clarification of the interaction of rules for equity securities, theequity method of accounting, and forward contracts and purchase options on certain types of securities. ASU 2020-01 is effective for the Company beginning January 1, 2022, with early adoptionpermitted. The Company is currently in the process of evaluating the effects of this pronouncement on the Company's financial statements and does not expect it to have a material impact on theconsolidated financial statements.

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NIKOLA CORPORATION

Notes to Consolidated Financial Statements (Continued)

(Unaudited)

3. BALANCE SHEET COMPONENTS

Prepaid Expenses and Other Current Assets

        Prepaid expenses and other current assets consisted of the following at March 31, 2020 and December 31, 2019, respectively:

        Deferredstock issuance costs consist of specific incremental expenses directly attributable to the Business Combination and related PIPE investment. These expenses will offset proceedsreceived from the transactions in the second quarter of 2020.

Property and Equipment

        Property and equipment consisted of the following at March 31, 2020 and December 31, 2019, respectively:

        Depreciationexpense for the three months ended March 31, 2020 and 2019 was $1.3 million and $0.2 million, respectively.

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NIKOLA CORPORATION

Notes to Consolidated Financial Statements (Continued)

(Unaudited)

3. BALANCE SHEET COMPONENTS (Continued)

Accrued Expenses and Other Current Liabilities

        Accrued expenses and other current liabilities consisted of the following at March 31, 2020 and December 31, 2019, respectively:

4. INTANGIBLE ASSETS, NET

        The gross carrying amount and accumulated amortization of separately identifiable intangible assets are as follows:

 

        Amortizationexpense for the three months ended March 31, 2020 and 2019 was immaterial.

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NIKOLA CORPORATION

Notes to Consolidated Financial Statements (Continued)

(Unaudited)

5. RELATED PARTY TRANSACTIONS

Related Party License and Service Agreements

        In September 2019, the Company entered into a Master Industrial Agreement (the "CNHI Services Agreement") and S-WAY Platform and Product SharingAgreement (the "CNHI License Agreement") with CNHI and Iveco S.p.A ("Iveco"), in conjunction with the Company's Series D redeemable convertible preferred stock offering. Under these agreements,the Company will issue CNHI and Iveco 13,498,921 shares of Series D redeemable convertible preferred stock in exchange for a license valued at $50.0 million, $100.0 millionin-kind services and $100.0 million in cash. CNHI is a related party to the Company as CNHI is represented by a member on the Company's board of directors. In February 2020, the Company andCNHI amended the Series D stock purchase agreement (the "Series D Purchase Agreement") for future sales and issuances of Series D redeemable convertible preferred stock to CNHIand its affiliates. The Company will issue CNHI and its affiliates the remaining previously committed shares of Series D redeemable convertible preferred stock in exchange for cash and in-kindservice contributions by the second quarter of 2020.

        Duringthe three months ended March 31, 2020, the Company issued 1,079,914 shares of Series D redeemable convertible preferred stock to Iveco in exchange for$20.0 million in-kind services, with $6.7 million of in-kind services recognized in research and development on the consolidated statements of operations and $13.3 million ofprepaid in-kind services recognized on the consolidated balance sheets.

Related Party Aircraft Charter Agreement

        In 2019, the Company entered into an aircraft charter arrangement with the Company's Chief Executive Officer (the "CEO") to reimburse the CEOfor the flight hours incurred for Company use on his personal aircraft. These flight hours are related to business travel by the CEO and other members of the Company's executive team to businessmeetings and trade conferences, as well as the CEO's commute between the Company's headquarters in Phoenix, Arizona and the CEO's residence in Utah. During the three months ended March 31, 2020and 2019 the Company reimbursed $0.2 million and zero, respectively, to the CEO for the use of the CEO's aircraft. As of March 31, 2020 and December 31, 2019 the Company had$0.2 million and $0.03 million, respectively, outstanding in accounts payable and accrued expenses to the CEO for the use of the CEO's aircraft.

Related Party Revenue and Accounts Receivable

        During the three months ended March 31, 2020 and 2019 the Company recorded revenues of $47 thousand and $24 thousand,respectively, for the provision of solar installation services to the CEO. As of March 31, 2020 and December 31, 2019, the Company had $30 thousand and $51 thousand,respectively, outstanding in accounts receivable related to solar installation services from the CEO. Subsequent to March 31, 2020 the receivable was paid and there are no outstandingreceivables remaining from the CEO.

Related Party Research and Development and Accounts Payable

        During the three months ended March 31, 2020 and 2019, the Company recorded research and development expenses of $0.9 million and$5.1 million, respectively, from a related party. As of

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NIKOLA CORPORATION

Notes to Consolidated Financial Statements (Continued)

(Unaudited)

5. RELATED PARTY TRANSACTIONS (Continued)

March 31,2020, the Company had $0.3 million of accounts payable due to related parties and $0.8 million of accrued expenses due to related parties. As of December 31,2019, the Company had $0.6 million of accounts payable due to related parties and $0.5 million of accrued expenses due to related parties. Accounts payable and accrued expenses withrelated parties primarily consists of outside development and other research and development expenses.

Related Party Stock Options

        In December 2018, the CEO issued 3,158,949 performance-based stock options ("PSUs") to recognize the performance and contribution of specificemployees. The underlying common stock of these option awards are owned by the CEO and are considered to be issued by the Company for accounting purposes. These performance-based stock options vestbased on theCompany's achievement of a liquidation event, such as a private sale or an initial public offering on a U.S. stock exchange. The weighted average grant date fair value of the performance-based stockoptions was $1.19 for the year ended December 31, 2018. As of March 31, 2020, these option awards have not vested and the unrecognized stock-based compensation expense related to theseoption awards is $3.8 million. Stock-based compensation expense of $3.8 million will be recognized upon close of the Business Combination and subsequent public listing of the Company inthe second quarter of 2020.

Related Party Stock Repurchase

        In September 2019, in contemplation of Nikola's proposed Series D financing round, Nikola entered into an amendment of that certainletter agreement by and between Nikola and Nimbus Holdings LLC ("Nimbus"), dated August 3, 2018 (the "Nimbus Redemption Letter Agreement" and as amended, the "Nimbus Amendment").Pursuant to the terms of the Nimbus Amendment and the Series B preferred stock repurchase agreement, Nikola agreed to repurchase 1,880,984 shares of Series B preferred stock held byNimbus, at the share price of $16.67 which is equal to 90% of the share price in the Series D financing round of $18.52 per share. The number of shares to be repurchased exceeded five percent(5%) of the contemplated Series D round of financing. This was negotiated by Nikola in order to reduce the total number of shares of Series B preferred stock held by Nimbus, to such anextent that Nimbus would no longer be entitled to elect a member of the Company's board of directors as a result of Nimbus' Series B preferred stock holdings. The repurchase was completed inOctober 2019, for an aggregate repurchase amount of $31.4 million. The Nimbus Amendment also provided Nimbus with additional redemption rights based on various capital raise thresholds, none ofwhich were met as of December 31, 2019.

        InMarch 2020, Nikola entered into an additional letter agreement with Nimbus in which Nimbus agreed to terminate the Nimbus Redemption Letter Agreement. Concurrently, Nikola enteredinto an agreement with Nimbus, whereby Nikola agreed to repurchase an additional 1,499,700 shares of Series B preferred shares from Nimbus at a share price of $16.67 for an aggregate repurchaseprice of $25.0 million. The parties agreed that the repurchase price constituted the price that Nimbus would otherwise be entitled to under the Nimbus Redemption Letter Agreement. The number ofshares to be repurchased was negotiated by Nikola and Nimbus as a mechanism to compensate Nimbus for agreeing to relinquish its previous redemption rights granted in the Nimbus Redemption LetterAgreement. The repurchase occurred in conjunction with the Business Combination during the second quarter of 2020.

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NIKOLA CORPORATION

Notes to Consolidated Financial Statements (Continued)

(Unaudited)

6. DEBT

Term Note

        Debt consisted of a term note for $4.1 million as of March 31, 2020 and December 31, 2019.

        InJanuary 2018, the Company entered into a term note with JP Morgan Chase where the Company borrowed $4.1 million to fund equipment purchases. The term note accrues interest at2.43% per annum and is payable on or before January 31, 2019. The term note is secured by restricted cash.

        InFebruary 2019, the Company amended the term note to extend its term by one year and increased the interest rate to 3.00% per annum. In February 2020, the Company amended the term noteto extend its term for one year, to January 31, 2021. The term note accrues interest at a rate equal to the LIBOR rate for the applicable interest period multiplied by the statutory reserverate as determined by the Federal Reserve Board. The term loan has a financial covenant that requires the Company to maintain a minimum amount of liquidity with JP Morgan Chase. As of March 31,2020, the Company was in compliance with the financial covenant.

7. CAPITAL STRUCTURE

Shares Authorized and Outstanding

        As of March 31, 2020 the Company had authorized a total of 366,651,920 shares for issuance with 237,000,000 shares designated as commonshares and 129,651,920 shares designated as preferred shares.

Redeemable Convertible Preferred Stock

        In January and March 2020, the Company raised $13.4 million through the issuance of 718,257 Series D redeemable convertiblepreferred stock at an $18.56 per share average, incurring $2.7 million of issuance costs. As such, the Company received aggregate net proceeds of $10.7 million. As of March 31,2020, $2.2 million of the issuance costs is included in accrued liabilities on the consolidated balance sheet. The Company also issued an additional 1,079,914 shares of Series Dredeemable convertible preferred stock for in-kind services valued at $20.0 million during the three months ended March 31, 2020.

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NIKOLA CORPORATION

Notes to Consolidated Financial Statements (Continued)

(Unaudited)

7. CAPITAL STRUCTURE (Continued)

        Thefollowing table summarizes the shares authorized, issued, and outstanding, price per share, net carrying value, and liquidation preference of the redeemable convertible preferredstock of the Company as of March 31, 2020:

        Thefollowing table summarizes the shares authorized, issued, and outstanding, price per share, net carrying value, and liquidation preference of the redeemable convertible preferredstock of the Company as of December 31, 2019:

        Therehave been no changes to various rights, privileges, and preferences to the holders of redeemable convertible preferred shares for the three months ended March 31, 2020.

        Inconjunction with the Business Combination in June 2020, all shares of outstanding redeemable convertible preferred stock were converted into shares of common stock. See Note 12"Subsequent Events" for further details on the transaction and share conversion.

8. STOCK-BASED COMPENSATION EXPENSE

Stock Option Plan

        The Nikola Corporation 2017 Stock Option Plan (the "2017 Plan") provides for the grant of incentive and nonqualified options to purchase theCompany's common stock to select officers, key employees, directors, and consultants. Options are granted at a price not less than the fair market value

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NIKOLA CORPORATION

Notes to Consolidated Financial Statements (Continued)

(Unaudited)

8. STOCK-BASED COMPENSATION EXPENSE (Continued)

onthe date of grant and generally become exercisable between one and four years after the date of grant. Options generally expire ten years from the date of grant.

Common Stock Valuation

        The fair value of the common stock that underlies the stock options is determined by the board of directors based upon information available atthe time of grant. Because there is no public market for the common stock, the Company's board of directors determined the fair value of the Company's common stock based on periodic valuation studiesfrom an independent third-party valuation firm.

        Inperforming its valuation analysis, the valuation firm engaged in discussions with management, evaluated key milestone achievements, analyzed historical and forecasted financialstatements and reviewed corporate documents. In addition, these valuation studies were based on a number of assumptions, including industry, general economic, market and other conditions that couldreasonably be evaluated at the time of the valuation.

Stock Option Valuation

        The Company utilizes the Black-Scholes option pricing model for estimating the fair value of options granted, which requires the input of highlysubjective assumptions.

        TheCompany calculates the fair value of each option grant on the grant date using the following assumptions:

        Expected Term—The Company uses the simplified method when calculating expected term due to insufficient historical exercise data.

        Expected Volatility—As the Company's shares are not actively traded, the volatility is based on a benchmark of comparable companies within theautomotive and energy storage industries.

        Expected Dividend Yield—The dividend rate used is zero as the Company does not have a history of paying dividends on its common stock and does notanticipate doing so in the foreseeable future.

        Risk-Free Interest Rate—The interest rates used are based on the implied yield available on U.S. Treasury zero-coupon issues with an equivalentremaining term equal to the expected life of the award.

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NIKOLA CORPORATION

Notes to Consolidated Financial Statements (Continued)

(Unaudited)

8. STOCK-BASED COMPENSATION EXPENSE (Continued)

        Thefollowing table presents the impact of stock-based compensation expense on the consolidated statements of operations for the three months ended March 31, 2020 and 2019:

        Theunrecognized compensation cost of stock options as of March 31, 2020 was $12.8 million, which is expected to be recognized over the weighted average remaining serviceperiod of 3.2 years. As of March 31, 2020, there were 12,215,598 shares available for future issuance under the 2017 Plan. Inconnection with the Business Combination, certain stock option vesting periods were accelerated and the Company recorded an additional $8.1 million of expense during the second quarter of 2020.

Performance Based Stock Options

        As of March 31, 2020 and December 31, 2019 the outstanding PSUs issued by the Company were 2,710,934. No PSUs were granted induring the three months ended March 31, 2020. The 2,710,934 PSUs outstanding as of March 31, 2020 have a vesting condition based on the achievement of specified amounts of equity capitalraised by the Company subsequent to the grant date. The performance-based provision was achieved for all of the outstanding performance-based award and the Company began recognizing expense related tothese PSUs in 2018.

        The2,710,934 PSUs outstanding as of March 31, 2020 do not include PSUs issued by a related party. See Note 5, "Related Party Transactions" for additional informationregarding the related party PSUs.

Stock Option Activity

        Changes in stock options are as follows:

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NIKOLA CORPORATION

Notes to Consolidated Financial Statements (Continued)

(Unaudited)

8. STOCK-BASED COMPENSATION EXPENSE (Continued)

        The weighted-average grant date fair value of stock options issued for the three months endedMarch 31, 2020 were $4.80. There were 646 stock options exercised during the three months ended March 31, 2020 and the total intrinsic value of stock options exercised is immaterial.

Related Party Performance-based Stock Options Activity

        In December 2018, the CEO issued 3,158,949 PSUs to certain employees. The weighted average exercise price per share was $2.00 and theweighted-average grant date fair value of these PSUs was $1.19. There were no PSUs issued by the CEO in the periods ended March 31, 2020 and December 31, 2019. As of March 31,2020, the weighted average remaining contractual term of these PSUs is 8.75 years and the aggregate intrinsic value of these PSUs is $51.7 million. There were no PSUs vested or exercisedas of March 31, 2020. All PSUs vested in conjunction with the Business Combination in June 2020.

9. 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. Theeffect 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 periodrequires 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 forincome taxes may change as new events occur, additional information is obtained, or the tax environment changes.

        Incometax expense was $1 thousand and $2 thousand for the three months ended March 31, 2020 and 2019, respectively. The effective income tax rate was nil for threemonths ended March 31, 2020 and 2019. The Company's effective tax rate differs from the U.S. statutory rate primarily due to a full valuation allowance against its net deferred tax assets whereit is more likely than not that some or all of the deferred tax assets will not be realized.

10. COMMITMENTS AND CONTINGENCIES

Legal Proceedings

        The Company is subject to legal and regulatory actions that arise from time to time in the ordinary course of business. The assessment as towhether 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. In the opinion ofmanagement, there was not at least a reasonable possibility the Company may have incurred a material loss with respect to loss contingencies for asserted legal and other claims. However, the outcomeof litigation is inherently uncertain. There is no material pending or threatened litigation against the Company that remains outstanding as of March 31, 2020.

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NIKOLA CORPORATION

Notes to Consolidated Financial Statements (Continued)

(Unaudited)

10. COMMITMENTS AND CONTINGENCIES (Continued)

Commitments and Contingencies on Land Conveyance

        In February 2019, the Company was conveyed 430 acres of land in Mesa, Arizona by Pinal Land Holdings, LLC ("PLH"). The purpose of theland conveyance was to incentivize the Company to locate their manufacturing facility in Mesa and provide additional jobs to the region. The Company is required to commence construction of themanufacturing facility within two years of February 2019 (the "Manufacturing Facility Commencement Deadline"), and is required to complete construction of their manufacturing facility within fiveyears of February 2019 (the "Manufacturing Facility Deadline").

        Uponthe earlier of the Manufacturing Facility Commencement Deadline or the commencement of construction, the Company will deposit $4.0 million in escrow to PLH. The amount inescrow will be returned to the Company upon completion of construction.

        Ifthe Company fails to achieve the Manufacturing Facility Commencement Deadline, the Company has the option to extend the deadline for one year by providing written notice to PLH andpaying PLH $0.5 million. In the event the Company fails to achieve extended deadline, PLH is entitled to either the $4.0 million security deposit, or to purchase the 430 acres of landfrom the Company at a price equal to out of pocket costs and expenses incurred by the Company prior to the Manufacturing Facility Commencement Deadline.

        Ifthe Company fails to achieve the Manufacturing Facility Deadline, the Company may extend the completion deadline by paying PLH $0.2 million per month, until construction iscompleted (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 theMonthly 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.

Contingent Fee for Advisory Services

        In January 2020, the Company entered into an agreement to obtain advisory services for the potential Business Combination. The fee for theservices is contingent upon completion of the Business Combination. The Company considered the likelihood of the Business Combination consummating as probable and has accrued $3.0 million as ofMarch 31, 2020.

Contingent Fee for Marketing Services

        In February 2020, the Company entered into an agreement with a consultant for the marketing of battery-electric vehicle ("BEV") / hydrogen fuelcell electric vehicle ("FCEV") hybrid pickup truck. Under the agreement, should the Company accept reservation fees from prospective customers to purchase one or more pickup trucks, for every $100 inreservation fees, the Company will issue 10 shares of common stock to the consultant for up to a maximum of 2,000,000 shares. The Company also agreed to reimburse the consultant up to$5.0 million in marketing costs. As of March 31, 2020 the Company has not started accepting reservation fees for the FCEV/BEV hybrid pickup truck.

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NIKOLA CORPORATION

Notes to Consolidated Financial Statements (Continued)

(Unaudited)

11. NET LOSS PER SHARE

        The following table sets forth the computation of the basic and diluted net loss per share attributable to common stockholders for the three months ended March 31, 2020 and 2019.

        Sincethe Company was in a loss position for all periods presented, basic net loss per share is the same as diluted net loss per share for all periods as the inclusion of all potentialcommon shares outstanding would have been anti-dilutive.

        Thefollowing weighted-average outstanding common stock equivalents were excluded from the computation of diluted net loss per share attributable to common stockholders for the periodspresented because including them would have been anti-dilutive.

12. SUBSEQUENT EVENTS

        The Company evaluated subsequent events through June 8, 2020, the date at which the unaudited financial statements were available to be issued.

Business Combination and Share Conversion

        On June 3, 2020, the Company and VectoIQ consummated the merger contemplated by the business combination agreement, with Nikola survivingthe merger as a wholly-owned subsidiary of VectoIQ. Immediately prior to the closing of the Business Combination, all shares of outstanding

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NIKOLA CORPORATION

Notes to Consolidated Financial Statements (Continued)

(Unaudited)

12. SUBSEQUENT EVENTS (Continued)

redeemableconvertible preferred stock were automatically converted into an aggregate of 89.2 million shares of Nikola common stock. Upon consummation of the Business Combination each share ofNikola common stock issued and outstanding was canceled and converted into the right to receive the number of shares of common stock of VectoIQ (the "Per Share Merger Consideration") equal to theexchange ratio of 1.901 (the "Exchange Ratio").

        Uponthe Closing of the Business Combination, VectoIQ's certificate of incorporation was amended and restated to increase the total number of authorized shares of all classes of capitalstock to 750 million, of which 600 million shares shall be Common Stock, $0.0001 par value per share, and of which 150 million shares shall be Preferred Stock, $0.0001 par valueper share.

        Inconnection with the execution of the Business Combination, VectoIQ entered into separate subscription agreements (each, a "Subscription Agreement") with a number of investors (each a"Subscriber"), pursuant to which the Subscribers agreed to purchase, and VectoIQ agreed to sell to the Subscribers, an aggregate of 52,500,000 shares of common stock (the "PIPE Shares"), for apurchase price of $10.00 per share and an aggregate purchase price of $525.0 million, in the PIPE. The PIPE investment closed simultaneously with the consummation of the Business Combination.

        Thegross proceeds from the Business Combination and PIPE Shares totaled $763.2 million, incurring $52.3 million in transaction fees, for net proceeds of$710.9 million. Net proceeds excludes payments for the $70.0 million M&M Residual, LLC share redemption and the repurchase of Series B convertible redeemable preferredshares from Nimbus for $25.0 million.

        TheBusiness Combination will be accounted for as a reverse merger in accordance with GAAP. Under this method of accounting, VectoIQ will be treated as the "acquired" company forfinancial reporting purposes. This determination was primarily based on Nikola shareholders having a majority of thevoting power of the combined company, Nikola comprising the ongoing operations of the combined company, Nikola comprising a majority of the governing body of the combined company, and Nikola's seniormanagement comprising the senior management of the combined company. Accordingly, for accounting purposes, the Business Combination will be treated as the equivalent of Nikola issuing stock for thenet assets of VectoIQ, accompanied by a recapitalization. The net assets of VectoIQ will be stated at historical cost, with no goodwill or other intangible assets recorded.

Joint Venture

        In April 2020, the Company and Iveco entered into a series of agreements which established a joint venture in Europe, Nikola IvecoEurope B.V. The operations expected to be performed by the joint venture consist of the development and manufacturing of the BEV and FCEV trucks for the European market, as well as for theNorth American market while Nikola's greenfield manufacturing facility in Coolidge, Arizona is being completed. The operations of the joint venture are expected to commence in the third quarter offiscal 2020.

        Theagreements 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 Nikola and Iveco.Both parties are entitled to appoint an equal number of board members to the board of Nikola Iveco Europe B.V. Pursuant to the terms of the agreements, the Company and Iveco each contributedintellectual property licenses to their respective technology, and agreed to contribute approximately $8.0 million in cash for a 50.0%

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NIKOLA CORPORATION

Notes to Consolidated Financial Statements (Continued)

(Unaudited)

12. SUBSEQUENT EVENTS (Continued)

interestin Nikola Iveco Europe B.V. The intellectual property licenses contributed to the joint venture by Nikola are related to intellectual property related to Nikola-developed BEV and FCEVtechnology for the use in the European market. Iveco contributed to the joint venture a license for the S-WAY technology for use in the European market.

        TheCompany is in the process of evaluating the joint venture under ASC Topic 810-10, Consolidations. The Company will complete theanalysis and plans to disclose the accounting for the joint venture in its financial statements for the quarter ending June 30, 2020.

Borrowings

        In April 2020, the Company entered into a Note with JP Morgan Chase under the Small Business Administration Paycheck Protection Programestablished under Section 1102 of the Coronavirus Aid, Relief and Economic Security (CARES) Act, pursuant to which the Company borrowed $4.1 million (the "Note"). The Note accruesinterest at rate of 0.98% per annum and matures in 24 months.

        OnApril 30, 2020, the Company returned the $4.1 million in proceeds from the Note to JP Morgan Chase, originally obtained under the Small Business Administration PaycheckProtection Program.

Series D Issuance

        In April 2020, the Company fulfilled the Forward Contract Liability and issued CNHI, a related party, 2,699,784 shares of Series Dredeemable convertible preferred stock at a price of $18.52 resulting in gross proceeds of $50.0 million. In June 2020, the Company issued CNHI 3,887,658 shares of Series D redeemableconvertible preferred stock for $72.0 million of prepaid in-kind services.

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Table of Contents

Report of Independent Registered Public Accounting Firm

Tothe Stockholders and the Board of Directors of Nikola Corporation

Opinion on the Financial Statements

        We have audited the accompanying consolidated balance sheets of Nikola Corporation (the Company) as of December 31, 2019 and 2018, therelated consolidated statements of operations, redeemable convertible preferred stock and stockholders' deficit and cash flows for each of the three years in the period ended December 31, 2019,and the related notes (collectively referred to as the "consolidated financial statements"). In our opinion, the consolidated financial statements present fairly, in all material respects, thefinancial position of the Company at December 31, 2019 and 2018, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2019,in conformity with U.S. generally accepted accounting principles.

Basis for Opinion

        These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company'sfinancial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent withrespect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the U.S. Securities and Exchange Commission and the PCAOB.

        Weconducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether thefinancial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control overfinancial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectivenessof the Company's internal control over financial reporting. Accordingly, we express no such opinion.

        Ouraudits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respondto those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accountingprinciples used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for ouropinion.

/s/Ernst & Young LLP

Wehave served as the Company's auditor since 2018.

Phoenix,Arizona
March 13, 2020,
except for paragraphs 7 through 11 of Note 14, as to which the date is
May 1, 2020

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NIKOLA CORPORATION

CONSOLIDATED BALANCE SHEETS

(in thousands, except share and per share data)

   

See accompanying notes to consolidated financial statements.

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NIKOLA CORPORATION

CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except share and per share data)

   

See accompanying notes to consolidated financial statements.

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NIKOLA CORPORATION

CONSOLIDATED STATEMENTS OF REDEEMABLE CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS' DEFICIT

(in thousands, except share data)

   

See accompanying notes to consolidated financial statements.

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NIKOLA CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

   

See accompanying notes to consolidated financial statements.

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NIKOLA CORPORATION

Notes to Consolidated Financial Statements

1. DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION

        Nikola Corporation ("Nikola" or the "Company") is a designer and manufacturer of battery-electric and hydrogen-electric vehicles, electric vehicle drivetrains, vehicle components, energystorage systems, and hydrogen stations.

        TheCompany is also developing a network of hydrogen fueling stations to meet hydrogen fuel demand for its customers. Fueling related activities will be conducted through the Company'swholly-owned subsidiary, Nikola Energy.

        TheCompany also develops electric vehicle solutions for military and outdoor recreational applications through its wholly-owned subsidiary, Nikola Powersports.

        TheCompany was formed as a Limited Liability Company ("LLC") in Nevada on May 18, 2012 under the name Bluegentech LLC and was converted from an LLC to a Delawarecorporation through an LLC conversion ("LLC Conversion"), which became effective on July 11, 2017.

        Shareand per share amounts are presented on a post-conversion basis for all periods presented, unless otherwise specified.

(a)

Basis of Presentation

        Theaccompanying consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles ("GAAP") and pursuant to the regulations of theU.S. Securities and Exchange Commission ("SEC").

(b)

Funding Risks and Going Concern

        Asan early stage growth company, Nikola's ability to access capital is critical. Management plans to raise additional capital through a combination of public equity, debt financings,strategic alliances, and licensing arrangements.

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

        TheCompany'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 todelay, 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.

        Thesefinancial 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 therealization 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 outcomeof this uncertainty.

        Asof March 13, 2020, the Company's existing cash resources and existing borrowing availability are sufficient to support planned operations for the next 12 months. As aresult, management believes that its existing financial resources are sufficient to continue operating activities for at least one year past the issuance date of the financial statements.

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NIKOLA CORPORATION

Notes to Consolidated Financial Statements (Continued)

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

(a)

Principles of Consolidation

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

(b)

Comprehensive Loss

        Comprehensiveloss includes all changes in equity during a period from non-owner sources. Through December 31, 2019, there are no components of comprehensive loss which are notincluded in net loss; therefore, a separate statement of comprehensive loss has not been presented. The Company does not have any foreign currency translation adjustments as a component of othercomprehensive loss through December 31, 2019, as the functional currency of all subsidiaries is the U.S. Dollar.

(c)

Use of Estimates

        Thepreparation of financial statements in conformity with GAAP requires management to make certain estimates and assumptions. These estimates and assumptions affect the reported amountsof assets and liabilities and disclosure of contingent assets and liabilities as of the balance sheet date, as well as reported amounts of revenue and expenses during the reporting period. TheCompany's most significant estimates and judgments involve valuation of the Company's stock-based compensation, including the fair value of common stock, the valuation of warrant liabilities, thevaluation of the redeemable convertible preferred stock tranche liability and estimates related to the Company's build-to-suit lease. In addition, estimates and assumptions are used for the accountingfor business combinations, including the fair values and useful lives of acquired assets and assumed liabilities. Management bases its estimates on historical experience and on various otherassumptions believed to be reasonable, the results of which form the basis for making judgments about the carrying values of assets and liabilities. Actual results could differ from those estimates.

(d)

Fiscal Periods

        TheCompany's fiscal year begins on January 1 and ends of December 31. The Company refers to the fiscal years as "fiscal year 2019", "fiscal year 2018" and "fiscal year2017".

(e)

Segment Information

        UnderAccounting Standards Codification ("ASC 280"), Segment Reporting, operating segments are defined as components of an enterprisewhere discrete financial information is available that is evaluated regularly by the chief operating decision-maker ("CODM"), in deciding how to allocate resources and in assessing performance. TheCompany has three components, the truck business unit, energy business unit and Powersports business unit. The truck business unit is developing and commercializing hydrogen-electric andbattery-electric semi-trucks that provide environmentally friendly, cost effective solutions to the long-haul trucking sector. The energy business unit is developing and constructing a network ofhydrogen fueling stations to meet hydrogen fuel demand for its customers. The Powersports business unit is developing electric vehicle solutions for military and outdoor recreational applications. Todate, the Company has not entered into production for the above-mentioned business units. Therefore, the Company's chief executive officer, who is also the CODM, makes decisions and manages theCompany's operations as a single operating segment for purposes of allocating resources and evaluating financial performance.

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NIKOLA CORPORATION

Notes to Consolidated Financial Statements (Continued)

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

        Alllong-lived assets are maintained in, and all losses are attributable to, the United States of America.

(f)

Concentration of Credit Risk

        Financialinstruments that potentially subject the Company to concentrations of credit risk consist of cash, cash equivalents and accounts receivable. The Company's cash is placed withhigh-credit-quality financial institutions and issuers, and at times exceed federally insured limits. The Company limits its concentration of risk in cash equivalents by diversifying its investmentsamong a variety of industries and issuers. The Company has not experienced any credit loss relating to its cash equivalents. The Company performs periodic credit evaluations of its customers andgenerally does not require collateral.

(g)

Concentration of Supplier Risk

        TheCompany is not currently in the production stage and generally utilizes suppliers for outside development and engineering support. The Company does not consider any of their suppliesto be critical to their research and development activities and does not believe that there is any significantsupplier concentration risk during the years ended December 31, 2019, 2018, or 2017.

(h)

Cash, Cash Equivalents and Restricted Cash and Cash Equivalents

        TheCompany considers all highly liquid investments purchased with a remaining maturity of three months or less to be cash equivalents. Additionally, the Company considers investments inmoney market funds with a floating net asset value to be cash equivalents. As of December 31, 2019 and December 31, 2018 the Company had $85.7 million and $160.7 million ofcash and cash equivalents, which included cash equivalents of $73.0 million and $151.6 million highly liquid investments at December 31, 2019 and December 31, 2018,respectively.

        Asof December 31, 2019, the Company had $4.1 million in an escrow account related to the securitization of a term loan. As of December 31, 2018, the Company had$13.3 million in an escrow account related to the build-out of the Phoenix, Arizona headquarters facility and the securitization of the term loan. These balances are classified as restrictedcash on the consolidated balance sheet.

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

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NIKOLA CORPORATION

Notes to Consolidated Financial Statements (Continued)

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

(i)

Fair Value of Financial Instruments

        TheCompany's financial instruments consist of cash and cash equivalents, restricted cash and cash equivalents, accounts receivables, prepaid expenses and other current assets, accountspayable, accrued expenses and other current liabilities, term loan, the redeemable convertible preferred stock warrant liability and the redeemable convertible preferred stock tranche liability. Theassets and liabilities that were measured at fair value on a recurring basis are cash equivalents, restricted cash equivalents, the redeemable convertible preferred stock warrant liability and theredeemable convertible preferred stock tranche liability. The Company believes that the carrying values of the remaining financial instruments approximate their fair values. The Company applies fairvalue accounting in accordance with ASC 820, Fair Value Measurements for valuation of financial instruments. ASC 820 provides a framework for measuringfair value under GAAP that expands disclosures about fair value measurements, establishes a fair value hierarchy, and requires an entity to maximize the use of observable inputs and minimize the useof unobservable inputs when measuring fair value. The three levels of the fair value hierarchy are summarized as follows:

Level 1—Fair value is based on observable inputs such as quoted prices for identical assets or liabilities in active markets.

Level 2—Fair value is determined using quoted prices for similar assets or liabilities in active markets or quoted prices foridentical or similar assets or liabilities in markets that are not active or are directly or indirectly observable.

Level 3—Fair value is determined using one or more significant inputs that are unobservable in active markets at the measurementdate, such as an option pricing model, discounted cash flow, or similar technique.

        Thecarrying value and fair value of the Company's financial instruments are as follows:

 

        TheSeries A redeemable convertible preferred stock warrant liability is remeasured at the end of every period and carried at fair value. The estimated fair value of theSeries A redeemable convertible

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NIKOLA CORPORATION

Notes to Consolidated Financial Statements (Continued)

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

preferredstock warrant liability as of December 31, 2018 and 2017 was determined using the Black-Scholes option pricing model. The Black-Scholes option pricing model calculated fair value issubjective and is affected by certain key inputs to the valuation model, which are disclosed in the table below. As the Black-Scholes option pricing model estimates the fair value of theSeries A redeemable convertible preferred stock warrant liability using certain inputs, Series A redeemable convertible preferred stock warrants are considered a Level 3 fairvalue measurement.

        AllSeries A redeemable convertible preferred stock warrants were exercised at the end of 2019. Prior to the exercise of the warrants, the Company remeasured the Series Aredeemable convertible preferred stock warrant liability and recognized a loss of $3.3 million for the year ended December 31, 2019. This loss is included as a component of other income(expense) on the consolidated statements of operations. Upon exercise of the warrants, the Company reclassified the warrant liability to additional paid-in capital on the consolidated balance sheets.

        Thefollowing table provides a reconciliation of the activity between the issuance date and ending balances for the Series A redeemable convertible preferred stock warrantliability measured at fair value.

        Thefollowing table represents significant unobservable inputs used in determining the fair value of the redeemable convertible preferred stock warrant liability:

        TheCompany determined that its obligation to issue, and the Company's investors' obligation to purchase, additional shares of Series D redeemable convertible preferred stock at afixed price in a

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NIKOLA CORPORATION

Notes to Consolidated Financial Statements (Continued)

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

subsequenttranche ("Subsequent Sale") following the initial closing of the Series D preferred stock financing represented a freestanding financial instrument (the "Series D ForwardLiability"). This obligation will be remeasured prior to the issuance of the subsequent tranche, and at each subsequent reporting period with changes in fair value for each reporting period recognizedin other income (expense) on the consolidated statements of operations (see Note 6). The obligation was not material at inception of the Subsequent Sale in September 2019, and atDecember 31, 2019.

        TheSeries D Forward Liability was valued as a forward contract. The fair value of the obligation was determined using a present value calculation. In determining the fair valueof the Series D Forward Liability, estimates and assumptions impacting fair value included the estimated future value of the Company's Series D preferred stock, discount rates andestimated time to liquidity. The Company determined the per share future value of the Series D preferred shares by back-solving to the initial proceeds of the Series D financing. Thefollowing reflects the significant quantitative inputs used in the valuation of the Series D Forward Liability:

(j)

Property and Equipment

        Propertyand equipment is stated at cost less accumulated depreciation. Repair and maintenance costs are expensed as incurred. Depreciation is recorded on a straight-line basis over eachasset's estimated useful life.

(k)

Leases

        TheCompany records rent expense on a straight-line basis over the life of the lease. In cases where there is a free rent period or future fixed rent escalations, the Company records adeferred rent liability. Additionally, the receipt of any lease incentives is recorded as a deferred rent liability which is amortized over the lease term as a reduction of rent expense. Buildingimprovements made with the lease incentives or tenant allowances are capitalized as leasehold improvements and included in property and equipment in the balance sheets.

        Theleasing arrangement for the Company's headquarters in Phoenix, Arizona required the Company to be involved in the construction of the building, therefore, the Company was consideredthe owner of the leased assets for accounting purposes during the construction period. During fiscal 2018 and 2019, the Company recorded project construction costs paid or reimbursed by the landlordas

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NIKOLA CORPORATION

Notes to Consolidated Financial Statements (Continued)

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

constructionin progress and a corresponding build-to-suit lease liability. Upon the construction completion in September 2019, the construction in progress asset was reclassified to property andequipment and construction period liability was reclassified to financing liability, within accrued expenses and other current liabilities and other long-term liabilities. Rent payments allocated todebtservice are being recorded to amortize the financing obligation using the effective interest method.

(l)

Business Combinations

        TheCompany allocates the fair value of purchase consideration to the tangible assets acquired, liabilities assumed, and intangible assets acquired based on their estimated fair values.The excess of the fair value of purchase consideration over the fair values of these identifiable assets and liabilities is recorded as goodwill. Such valuations require management to make significantestimates and assumptions, especially with respect to intangible assets. Significant estimates in valuing certain intangible assets include, but are not limited to, future expected cash flows fromacquired licenses, trade names, in process research and development ("R&D"), useful lives and discount rates. Management's estimates of fair value are based upon assumptions believed to be reasonable,but which are inherently uncertain and unpredictable and, as a result, actual results may differ from estimates. During the measurement period, the Company may record adjustments to the assetsacquired and liabilities assumed, with the corresponding offset to goodwill. Upon the conclusion of the measurement period, any subsequent adjustments are recorded in the consolidated statement ofoperations.

(m)

Goodwill, Intangible Assets with Indefinite Useful Lives, and Other Intangible Assets

        TheCompany records goodwill when consideration paid in a purchase acquisition exceeds the fair value of the net tangible assets and the identified intangible assets acquired. Goodwillis not amortized, but rather is tested for impairment annually or more frequently if facts and circumstances warrant a review. The Company has determined that there is a single reporting unit for thepurpose of goodwill impairment tests, which are performed annually. For purposes of assessing the impairment of goodwill, the Company performs a qualitative analysis on December 31, each yearto determine if events or changes in circumstances indicate the fair value of the reporting unit is less than its carrying value.

        Factorsconsidered which could trigger a further impairment review include, but are not limited to, significant under-performance relative to historical or projected future operatingresults, significant changes in the manner of use of the acquired assets or the Company's overall business strategy, and significant industry or economic trends. When the carrying value of along-lived asset may not be recoverable based on the existence of one or more of the above indicators, recoverability is determined by comparing the carrying amount of the asset to net futureundiscounted cash flows that the asset is expected to generate. An impairment charge would then be recognized equal to the amount by which the carrying amount exceeds the fair-market value of theasset.

        Therewas no impairment of goodwill for the years ended December 31, 2019, 2018 and 2017.

        Otherintangible assets, consisting of licenses, in-process R&D and trademarks, are stated at cost less accumulated amortization. In-process R&D has an indefinite useful life untilcompletion of the related R&D efforts and will subsequently be amortized over an estimated useful life. All other intangible assets have been determined to have finite lives and are amortized on astraight-line basis over their estimated remaining economic lives.

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NIKOLA CORPORATION

Notes to Consolidated Financial Statements (Continued)

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

        Trademarksare amortized over twelve years and included in research and development expense, or selling, general, and administrative expense within the consolidated statements ofoperations. Licenses are amortized over five to seven years and included in selling, general, and administrative expense within the consolidated statements of operations.

        Forintangible assets acquired in a non-monetary exchange, the estimated fair value of the shares transferred are used to establish their recorded values.

        Externalcosts incurred to renew or extend the term of the identifiable intangible assets are capitalized and amortized over the estimated useful life.

(n)

Impairment of Long-Lived Assets and Definite-lived Intangible Assets

        TheCompany reviews its long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying value may not be recoverable. The events and circumstanceswe monitor and consider include significant decreases in the market price of similar assets, significant adverse changes to the extent and manner in which the asset is used, an adverse change in legalfactors or business climate, an accumulation of costs that exceed the estimated cost to acquire or develop a similar asset, and continuing losses that exceed forecasted costs. The Company assesses therecoverability of these assets by comparing the carrying amount of such assets or asset group to the future undiscounted cash flow it expects the assets or asset group to generate. The Companyrecognizes an impairment loss if the sum of the expected long-term undiscounted cash flows that the long-lived asset is expected to generate is less than the carrying amount of the long-lived assetbeing evaluated. An impairment charge would then be recognized equal to the amount by which the carrying amount exceeds the fair value of the asset.

        Therewas no impairment of long-lived assets, including definite-lived intangible assets, recorded for the years ended December 31, 2019, 2018 and 2017.

(o)

Income Taxes

        TheCompany accounts for income taxes using the asset and liability method, under which deferred tax assets and liabilities are recognized for the expected future tax consequencesattributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases.

        Avaluation allowance is provided when it is more likely than not that some portion or all of a deferred tax asset will not be realized. Due to the Company's lack of earnings history,the net deferred tax assets have been fully offset by a valuation allowance as of December 31, 2019 and 2018. Uncertain tax positions taken or expected to be taken in a tax return are accountedfor using the more likely than not threshold for financial statement recognition and measurement.

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NIKOLA CORPORATION

Notes to Consolidated Financial Statements (Continued)

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

        OnDecember 22, 2017, the U.S. enacted significant changes to U.S. tax law following the passage and signing of H.R. 1, "An Act to Provide for Reconciliation Pursuant to Titles IIand V of the Concurrent Resolution of the Budget for Fiscal Year 2018" (the "Tax Act"). The Tax Act permanently reduced the U.S. federal corporate tax rate from a maximum 35% to 21%, eliminatedcorporate Alternative Minimum Tax, modified rules for expensing capital investment, limited the deduction of interest expense for certain companies, modified rules related to net operating losses, andhad international tax consequences for companies that operate abroad. Most of the changes introduced in the Tax Act were effective beginning on January 1, 2018. The SEC staff issued StaffAccounting Bulletin No. 118 (SAB 118) to address the application of GAAP in situations when a registrant does not have the necessary information available, prepared, or analyzed(including computations) in reasonable detail to complete the accounting for certain income tax effects of the Tax Cuts and Jobs Act (2017 Tax Act). SAB 118 provides a measurement period thatshould not extend beyond one year from the 2017 Tax Act enactment date for companies to complete the accounting for the income tax effects of certain elements of the 2017 Tax Act. In accordance withSAB 118, the Company has recognized the provisional tax impacts related to the remeasurement of deferred tax assets and liabilities and included these amounts in its financial statements forthe year ended December 31, 2017. The accounting for the income tax effects of the 2017 Tax Act is considered complete at December 31, 2018, with no material changes to the provisionalamounts. See Note 11, "Income Taxes" for additional discussion.

(p)

Stock-based Compensation

Employees

        The Company recognizes the cost of share-based awards granted to employees and directors based on the estimated grant-date fair value of theawards. Cost is recognized on a straight-line basis over the service period, which is generally the vesting period of the award. The Company recognizes stock-based compensation cost and reversespreviously recognized costs for unvested options in the period forfeitures occur. The Company determines the fair value of stockoptions using the Black-Scholes option pricing model, which is impacted by the fair value of common stock, expected price volatility of common stock, expected term, risk-free interest rates, andexpected dividend yield.

Non-Employees

        The Company recognizes the cost of stock-based awards granted to non-employees based on grant-date fair value as determined by the Black-Scholesoption pricing model. The Company believes that the fair value of the stock options is more reliably measured than the fair value of the services received. Compensation expense is recognized asservices are performed and vesting conditions are met. The calculated fair-value of these awards are remeasured at each balance sheet date. As of January 1, 2019, the Company adopted ASU2018-07, Compensation—Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting, and the equity-classifiednon-employee awards will no longer be required for remeasurement at the reporting date.

(q)

Redeemable Convertible Preferred Stock

        TheCompany records shares of redeemable convertible preferred stock at their respective fair values on the dates of issuance, net of issuance costs. The redeemable convertible preferredstock is

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NIKOLA CORPORATION

Notes to Consolidated Financial Statements (Continued)

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

recordedoutside of stockholders' deficit on the consolidated balance sheets because the shares contain liquidation features that are not solely within the Company's control. The Company has electednot to adjust the carrying values of the redeemable convertible preferred stock to the liquidation preferences of such shares because of the uncertainty of whether or when such an event would occur.Subsequent adjustments to increase the carrying values to the liquidation preferences will be made only when it becomes probable that such a liquidation event will occur.

(r)

Redeemable Convertible Preferred Stock Warrant Liability

        TheCompany has issued freestanding warrants to purchase shares of its Series A redeemable convertible preferred stock that are classified outside of permanent equity. As suchthese warrants were recorded at fair value, and subject to remeasurement at each balance sheet date until the earlier of the exercise of the warrants or the completion of a liquidation event,including the completion of an initial public offering. Upon exercise, the redeemable convertible preferred stock warrant liability was reclassified to additional paid-in capital.

(s)

Revenue Recognition

        Todate, the Company's revenues are derived primarily from solar installation services, which are generally completed in less than one year.

        TheCompany's customer contracts contain a single performance obligation, which is the solar installation service. The transaction price in the Company's customer contracts is fixed.Revenue for solar installation contracts is generally recognized over time as the services are rendered to the customer based on the extent of progress towards completion of the performanceobligation. Under this method, progress of contracts is measured by actual costs incurred in relation to the Company's best estimate of total estimated costs, which are reviewed and updated routinelyfor contracts in progress. The cumulative effect of any change in estimate is recorded in the period when the change in estimate is determined.

(t)

Cost of Revenues

        Costof revenues includes materials, labor, and other direct costs related to solar installation projects. The Company recognizes cost of revenues in the period that revenues arerecognized.

(u)

Research and Development Expense

        Researchand development expense consist of outsourced engineering services, allocated facilities costs, depreciation, internal engineering and development expenses, materials, labor andstock-based compensation related to development of the Company's products and services. Research and development costs are expensed as incurred.

(v)

Selling, General, and Administrative Expense

        Selling,general, and administrative expense consist of personnel costs, allocated facilities expenses, depreciation and amortization, travel, and marketing costs.

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NIKOLA CORPORATION

Notes to Consolidated Financial Statements (Continued)

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

(w)

Advertising Expense

        Advertisingexpense was $2.9 million, $0.2 million and $0.3 million for the years ended December 31, 2019, 2018 and 2017, respectively.

(x)

Other Income

        Otherincome primarily consists of grant income received from the government. Grant income is recognized as income over the periods necessary to match the income on a systematic basis tothe costs that it is intended to compensate.

(y)

Net Loss Per Share

        Basicand diluted net loss per share attributable to common stockholders is presented in conformity with the two-class method required for participating securities. The Company considersall series of its redeemable convertible preferred stock to be participating securities. Net loss is attributed to common stockholders and participating securities based on their participation rights.Net loss attributable tocommon stockholders is not allocated to the redeemable convertible preferred stock as the holders of the redeemable convertible preferred stock do not have a contractual obligation to share in anylosses.

        Underthe two-class method, basic net loss per share attributable to common stockholders is computed by dividing the net loss attributable to common stockholders by the weighted-averagenumber of shares of common stock outstanding during the period.

        Dilutedearnings per share attributable to common stockholders adjusts basic earnings per share for the potentially dilutive impact of redeemable convertible preferred stock, stockoptions, restricted stock units and warrants. As the Company has reported losses for all periods presented, all potentially dilutive securities including redeemable convertible preferred stock, stockoptions, restricted stock units and warrants, are antidilutive and accordingly, basic net loss per share equals diluted net loss per share.

(z)

Recent Accounting Pronouncements

        Asan emerging growth company ("EGC"), the Jumpstart Our Business Startups Act ("JOBS Act") allows the Company to delay adoption of new or revised accounting pronouncements applicable topublic companies until such pronouncements are applicable to private companies. The Company has elected to use this extended transition period under the JOBS Act until such time the Company is nolonger considered to be an EGC. The adoption dates discussed below reflect this election.

        InFebruary 2016, the Financial Accounting Standards Board ("FASB") issued ASU 2016-02, Leases (Topic 842), to increase transparency andcomparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. In July 2018, ASU 2018-10, Codification Improvements to Topic842, Leases, was issued to provide more detailed guidance and additional clarification for implementing ASU 2016-02.Furthermore, in July 2018, the FASB issued ASU 2018-11, Leases (Topic 842): Targeted Improvements, which provides an optional transition method inaddition to the existing modified retrospective transition method by allowing a cumulative effect adjustment to the opening balance of retained earnings in the period of adoption. These new leasingstandards are effective for the Company

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NIKOLA CORPORATION

Notes to Consolidated Financial Statements (Continued)

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

beginningJanuary 1, 2021, with early adoption permitted. The Company is currently evaluating the effect of the adoption of this guidance on the consolidated financial statements.

        InJune 2016, the FASB issued ASU 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses of FinancialInstruments, which, together with subsequent amendments, amends the requirement on the measurement and recognition of expected credit losses for financial assets held. ASU2016-13 is effective for the Company beginning January 1, 2023, with early adoption permitted. The Company is currently in the process of evaluating the effects of this pronouncement on theCompany's financial statements and does not expect it to have a material impact on the consolidated financial statements.

        InDecember 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes, which is intended tosimplify various aspects related to accounting for income taxes. The pronouncement is effective for fiscal years, and for interim periods within those fiscal years, beginning after December 15,2020, with early adoption permitted. ASU 2019-12 is effective for the Company beginning January 1, 2022, with early adoption permitted. The Company is currently in the process of evaluating theeffects of this pronouncement on the Company's financial statements and does not expect it to have a material impact on the consolidated financial statements.

(aa)

Recently Adopted Accounting Pronouncements

        InMay 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers, an updated standard on revenue recognition. This ASUsuperseded the revenue recognition requirements in Accounting Standards Codification Topic 605, Revenue Recognition, and most industry-specific guidance. ASU 2014-09 provides enhancements to thequality and consistency of how revenue is reported while also improving comparability in the financial statements of companies reporting using GAAP and International Financial Reporting Standards. Thecore principle of the new standard is for companies to recognize revenue to depict the transfer of goods or services to customers in amounts that reflect the consideration to which the company expectsto be entitled in exchange for those goods or services. In doing so, companies may be required to use more judgment and make more estimates than under current authoritative guidance.

        OnJanuary 1, 2019, the Company adopted the guidance under the modified retrospective method. The adoption of the guidance did not have a material impact on the Company'sconsolidated financial statements.

        InJanuary 2017, the FASB issued ASU 2017-04, Simplifying the Test for Goodwill Impairment, to simplify the test for goodwill impairmentby removing Step 2. An entity will, therefore, perform the goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount and recognizing an impairment charge forthe amount by which the carrying amount exceeds the fair value, not to exceed the total amount of goodwill allocated to the reporting unit. An entity still has the option to perform a qualitativeassessment to determine if the quantitative impairment test is necessary. TheASU is effective for interim and annual periods beginning after December 15, 2019, with early adoption permitted. Adoption of the ASU is prospective. The Company early adopted the ASU onJanuary 1, 2019. The ASU did not have a material impact on the Company's consolidated financial statements.

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NIKOLA CORPORATION

Notes to Consolidated Financial Statements (Continued)

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

        In June 2018, the FASB issued ASU 2018-07, Compensation—Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based PaymentAccounting, to align the accounting for share-based payment awards issued to employees and nonemployees, particularly with regard to the measurement date and the impact ofperformance conditions. The new guidance requires equity-classified share-based payment awards issued to nonemployees to be measured on the grant date, instead of being re-measured through theperformance completion date under the current guidance. For public entities, ASU 2018-07 is effective for fiscal years beginning after December 15, 2018, and early adoption is permitted. TheCompany chose to early adopt ASU 2018-07 effective for itsfinancial statements starting January 1, 2019 by recording the cumulative impact through an increase in additional paid-in capital and corresponding decrease in accumulated deficit of$0.2 million.

3. BALANCE SHEET COMPONENTS

Prepaid Expenses and Other Current Assets

        Prepaid expenses and other current assets consisted of the following at December 31, 2019 and 2018, respectively:

        Materialsand supplies consist of battery cells, solar panels and other miscellaneous components, and are expensed to research and development expense when consumed.

Property and Equipment

        Property and equipment consist of the following at December 31, 2019 and 2018, respectively:

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NIKOLA CORPORATION

Notes to Consolidated Financial Statements (Continued)

3. BALANCE SHEET COMPONENTS (Continued)

        Depreciationexpense for the years ended December 31, 2019, 2018 and 2017 was $2.3 million, $0.6 million and $0.4 million, respectively.

        Depositson equipment are classified from long-term deposits to property and equipment upon receipt or transfer of title of the related equipment.

        Duringthe year ended December 31, 2019, the Company was conveyed 430 acres of land in the city of Coolidge, Arizona at no cost. See Note 12"Commitments and Contingencies" for additional information regarding the land conveyance.

Accrued Expenses and Other Current Liabilities

        Accrued expenses and other current liabilities consisted of the following at December 31, 2019 and 2018, respectively:

4. BUSINESS COMBINATIONS

Acquisition of Alternative Power Systems, Inc.

        In August 2017, the Company completed the acquisition of Alternative Power Systems, Inc. ("APS"), a solar energy solutions company withexpertise in solar installation services. The APS acquisition provides business licenses, knowledge, and expertise related to solar panel installations that is expected to be used to further thedevelopment of Nikola's solar-powered hydrogen fueling stations and to provide the Company with general knowledge and expertise related to solar energy installation. The total purchase considerationfor the APS acquisition, as of the date of the acquisition is as follows:

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NIKOLA CORPORATION

Notes to Consolidated Financial Statements (Continued)

4. BUSINESS COMBINATIONS (Continued)

        Theacquisition was accounted for as a business combination. The following table summarizes the tangible and intangible assets acquired and the allocation of purchase price as of thedate of acquisition:

        Thegoodwill recognized as part of the transaction was generated by intangible assets that did not qualify for separate recognition.

Acquisition of Free Form Factory, Inc.

        In November 2017, the Company acquired 100% of the voting interest of Free Form Factory, Inc. ("FFF") by acquiring all outstandingshares. FFF is a personal watercraft start-up that has developed a unique thermoforming manufacturing process. The FFF acquisition provides technology, specialized knowledge, and expertise related toa manufacturing process that will be used by Nikola to produce recreational vehicle components. The total purchase consideration for the FFF acquisition, as of the date of the acquisition is asfollows:

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NIKOLA CORPORATION

Notes to Consolidated Financial Statements (Continued)

4. BUSINESS COMBINATIONS (Continued)

        The acquisition was accounted for as a business combination. The following table summarizes the tangible and intangible assets acquired and the allocation of purchase price as of thedate of acquisition:

        Thegoodwill recognized as part of the transaction was generated by intangible assets that did not qualify for separate recognition.

5. INTANGIBLE ASSETS, NET

        The gross carrying amount and accumulated amortization of separately identifiable intangible assets are as follows:

 

        Amortizationexpense for the years ended December 31, 2019, 2018, and 2017 was $63 thousand, $63 thousand and $15 thousand, respectively.

        Aspart of the Series D financing, the Company was granted a non-exclusive and non-transferable license to intellectual property used in the Iveco S-WAY Platform and Product,which is the cab over engine truck manufactured by Iveco S.p.A ("Iveco"), a wholly-owned subsidiary of CNH Industrial N.V. ("CNHI"), the Company's Series D major investor. The materialrights under the license agreement

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NIKOLA CORPORATION

Notes to Consolidated Financial Statements (Continued)

5. INTANGIBLE ASSETS, NET (Continued)

includethe non-exclusive use of the S-WAY key technology to manufacture, distribute and service BEV and FCEV trucks and related components in the United States, and the ability to grant the use ofthe key technology to the Company's North American sub-suppliers. The Company intends to utilize the license solely in North America for the development of BEV and FCEV trucks. The fair value of thelicense was determined to be $50.0 million. In exchange for the license, the Company issued 2,699,785 shares of Series D redeemable convertible preferred stock to CNHI and itsaffiliates. The Company will amortize the license using a straight-line method over a 7-year useful life, beginning at the start of commercial production, as it reflects the period over which thesales of BEV and FCEV trucks utilizing Iveco S-WAY platform are expected to contribute to the Company's cash flows. As of December 31, 2019, the Company has not started amortizing the license.The Company expects to place the license in use in fiscal year 2021.

        Estimatedamortization expense for all intangible assets subject to amortization in future years is expected to be:

6. RELATED PARTY TRANSACTIONS

Related Party License and Service Agreements

        In September 2019, the Company entered into a Series D stock purchase agreement ("Series D Purchase Agreement"), Master IndustrialAgreement ("CNHI Services Agreement") and S-WAY Platform and Product Sharing Agreement ("CNHI License Agreement") with CNHI and Iveco in conjunction with the Company's Series D redeemableconvertible preferred stock offering. Under these agreements, the Company will issue CNHI and Iveco 13,498,921 shares of Series D redeemable convertible preferred stock in exchange for alicense valued at $50.0 million, $100.0 million in-kind services and $100.0 million in cash. CNHI and its affiliates are related parties to the Company as CNHI is represented by amember on the Company's board of directors.

        In2019, the Company issued 2,699,785 shares of Series D redeemable convertible preferred stock to CNHI in exchange for $50.0 million. Additionally, the Company issued2,699,785 shares of Series D redeemable convertible preferred stock to Iveco in exchange for the licensed Iveco technology and 431,996 shares of Series D redeemable convertible preferredstock to Iveco in exchange for $8.0 million in-kind services. These in-kind services were recognized in research and development on the consolidated statements of operations.

        Concurrently,the Company agreed to enter into a forward sale agreement with CNHI whereby an additional 2,699,784 shares of Series D redeemable convertible preferred stock will beissued to CNHI in April 2020 at a price of $18.52 for an aggregate cash investment amount of $50.0 million. Such funds

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NIKOLA CORPORATION

Notes to Consolidated Financial Statements (Continued)

6. RELATED PARTY TRANSACTIONS (Continued)

willremain in escrow until such time as they are to be released to the Company at the closing of the transaction. The Company determined that its obligation to issue, and CNHI's obligation topurchase, additional shares of Series D redeemable convertible preferred stock at a fixed price in a subsequent tranche following the initial closing of the Series D preferred stockfinancing represented a freestanding financial instrument. The fair value of the Series D Forward Liability was not material at inception in September 2019, and when remeasured atDecember 31, 2019. The Company will continue to adjust the Series D Forward Liability for changes in the estimated fair value until the settlement of the Series D ForwardLiability. Any changes in fair value will be recognized on the consolidated statements of operations.

        Inaddition, the Company will issue 4,967,572 Series D redeemable convertible preferred stock periodically in 2020 in exchange for $92.0 million in in-kind servicesprovided by CNHI and Iveco.

        Oncethe Company commences production of semi-trucks to be sold or transferred to third parties, the Company is obligated to pay Iveco a royalty of 1.25% on the Company's fuel cellsemi-truck revenues and a royalty of 1.00% on the Company's battery electric semi-truck revenues, arising from any sale, lease or transfer of the Company's semi-truck products, vehicles, components,spare-parts and any related services, over a period of seven years. As of December 31, 2019, no royalty payments have been incurred.

Related Party Aircraft Charter Agreement

        In 2019, the Company entered into an aircraft charter arrangement with the Company's CEO to reimburse the CEO for the flight hours incurred forCompany use on his personal aircraft. These flight hours are related to business travel by the CEO and other members of the executive team to business meetings and trade conferences, as well as theCEO's commute between the Company's headquarters in Phoenix, Arizona and the CEO's residence in Utah. Approximately $0.2 million was reimbursed to the CEO by the Company for the use of theCEO's aircraft in 2019.

Related Party Revenue

        The CEO paid the Company $0.3 million and $0.2 million for the provision of solar installation services in 2019 and 2018,respectively. There was no related party revenue during fiscal year 2017.

Related Party Accounts Receivable

        As of December 31, 2019, the Company had $51 thousand outstanding in accounts receivable related to solar installation servicesfrom the CEO. No related party accounts receivable were outstanding as of December 31, 2018.

Related Party Accounts Payable

        As of December 31, 2019, the Company had $0.6 million of accounts payable due to related parties and $0.5 million ofaccrued expenses due to related parties. As of December 31, 2018, the Company had $9.9 million of accounts payable due to related parties. Accounts payable with related parties primarilyconsists of outside development and other research and development expenses.

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NIKOLA CORPORATION

Notes to Consolidated Financial Statements (Continued)

6. RELATED PARTY TRANSACTIONS (Continued)

Related Party Stock Options

        In December 2018, the CEO issued 3,158,949 performance-based stock options to recognize the superior performance and contribution of specificemployees. The underlying common stock of these option awards are owned by the CEO and are considered to be issued by the Company for accounting purposes. These performance-based stock options vestbased on the Company's achievement of a liquidation event, such as a private sale or an initial public offering on a U.S. stock exchange. The weighted average grant date fair value of theperformance-based stock options was $1.19 for the year ended December 31, 2018. As of December 31, 2019, these option awards have not vested and the unrecognized stock-based compensationexpense related to these option awards is $3.8 million.

Related Party Stock Repurchase

        In August 2018, concurrently with the Series C preferred stock financing, Nikola entered into the Nimbus Redemption Letter Agreement withNimbus, a related party. Pursuant to the terms of the Nimbus Redemption Letter Agreement, Nimbus received the right but not the obligation to sell back to Nikola its shares of Series Bpreferred stock and Series C preferred stock, with any such repurchases applying first to Series B preferred stock, in an amount equal to the value of up to five percent (5%) of theaggregate size of each of Nikola's subsequent equity financing rounds. The shares elected to be repurchased by Nimbus were to be purchased by Nikola at a share price equal to 90% of the share price inthe applicable subsequent financing round.

        InNovember 2018, the Company repurchased 517,464 Series B redeemable convertible preferred stock from the CEO at $8.05 per share for a total purchase price of$4.2 million. The repurchased redeemable convertible preferred stock was retired immediately thereafter. The payment of $4.2 million was net against the CEO's $2.5 millionpromissory note with the Company. The CEO also paid $0.3 million interest on the promissory note, therefore, the net payment to the CEO as a result of the stock repurchase was$1.4 million.

        InSeptember 2019, in contemplation of Nikola's proposed Series D financing round, Nikola entered into an amendment of the Nimbus Redemption Letter Agreement with Nimbus (the"Amendment"). Pursuant to the terms of the Amendment and the Series B preferred stock repurchase agreement, Nikola agreed to repurchase 1,880,984 shares of Series B preferred stock heldby Nimbus, at the share price of $16.67 which is equal to 90% of the share price in the Series D financing round of $18.52 per share. The number of shares to be repurchased exceeded fivepercent (5%) of the contemplated Series D round of financing. This was negotiated by Nikola in order to reduce the total number of shares of Series B preferred stock held by Nimbus, tosuch an extent that Nimbus would no longer be entitled to elect a member of the Company's board of directors as a result of Nimbus' Series Bpreferred stock holdings. The repurchase was completed in October 2019, for an aggregate repurchase amount of $31.4 million. The Amendment also provided Nimbus with additional redemption rightsbased on various capital raise thresholds, none of which have been met as of December 31, 2019.

        InMarch 2020, Nikola entered into an additional letter agreement with Nimbus in which Nimbus agreed to terminate the Nimbus Redemption Letter Agreement. Concurrently, Nikola enteredinto an agreement with Nimbus, whereby Nikola agreed to repurchase an additional 1,499,700 shares of Series B preferred shares from Nimbus at a share price of $16.67 for an aggregate repurchaseprice of $25.0 million. The parties agreed that the repurchase price constituted the price that Nimbus would otherwise be entitled to under the Nimbus Redemption Letter Agreement. The number ofshares to be

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NIKOLA CORPORATION

Notes to Consolidated Financial Statements (Continued)

6. RELATED PARTY TRANSACTIONS (Continued)

repurchasedwas negotiated by Nikola and Nimbus as a mechanism to compensate Nimbus for agreeing to relinquish its previous redemption rights granted in the Nimbus Redemption Letter Agreement.

Related Party Loans

        In May 2017, a director loaned the Company $1.1 million to help fund the Company's operations. The original term of the note was oneyear; however, the note was prepaid after the Company received Series B redeemable convertible preferred stock funding in September 2017. In connection with this loan, the Company recognized atotal of $0.2 million in interest expense related to interest and fees.

        InMay 2017, a third-party controlled by a director loaned the Company $0.3 million to help fund the Company's operations. The note was repaid in May 2017 with $30 thousandof interest.

        InJune 2017, a director loaned the Company $0.7 million to help fund the Company's operations. The note was repaid in September 2017 with $60 thousand of interest.

        InMarch 2018, the Company entered into a promissory note with the CEO. The CEO borrowed $2.5 million from the Company. The promissory note was secured by the CEO's ownershipinterest in the Company and was repaid in November 2018. Total interest paid to the Company related to thisnote was $57 thousand. In addition to the interest paid to the Company on the promissory note, the CEO also paid the company $0.2 million of additional interest in November 2018 in orderto reduce the overall interest paid related to the 2014 - 2017 revolving line of credit provided to the Company by the CEO.

Related Party Line of Credit

        Throughout the Company's history, the Company's CEO has provided the company a revolving line of credit by contributing cash to the company orpaying certain business expenses on the Company's behalf. This revolving line of credit had no scheduled interest payments, no contractual rate of interest, and no fixed term. Borrowings under therevolving line of credit began in October 2014, and in September 2017, the balance was repaid in full. The Company borrowed and repaid principal of $2.5 million over the life of the revolvingline of credit in connection with the termination of the line of credit in 2017. The Company made interest payments of $0.5 million over the life of the loan.

Related Party Convertible Notes Payable

        In March 2017, the Company issued $0.4 million of non-recourse convertible promissory notes to two unrelated third parties to help fundthe Company's operations. The value of the conversion feature was immaterial to the Company's financial statements. The notes paid interest at 12% per annum and contained a conversion feature wherebyat maturity, the noteholder had the option to receive common stock, in lieu of cash consideration, for up to 25% of outstanding principal and 100% of accrued interest.

        InSeptember 2017, all of the outstanding convertible notes were repaid. Noteholders elected to fully exercise their conversion option and therefore received 40,000 common shares in lieuof $0.1 million of principal repayment and $20 thousand in accrued interest. In accordance with the terms of the note, new shares were not issued by the Company directly, but rather weretransferred from the CEO's common equity holdings. In December 2017, the Company paid $0.1 million to the CEO to compensate him for the common shares transferred to settle the convertible note.

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Notes to Consolidated Financial Statements (Continued)

7. DEBT

        Notes payable consisted of the following as of December 31, 2019 and 2018, respectively:

Term Note

        In January 2018, the Company entered into a term note with JP Morgan Chase where the Company borrowed $4.1 million to fund equipmentpurchases. The term note accrues interest at 2.43% per annum and is payable on or before January 31, 2019. The term note is secured by cash.

        InFebruary 2019, the Company amended the term note to extend its term by one year and increased the interest rate to 3.00% per annum. The amended term note is secured by restrictedcash. In February 2020, the Company amended the term note to extend its term for one year, to January 31, 2021. The term loan has a financial covenant that requires the Company to maintain aminimum amount of liquidity with the bank. As of December 31, 2019, the Company was in compliance with the financial covenant.

8. CAPITAL STRUCTURE

LLC Conversion

        On July 10, 2017, the Company converted from a limited liability company into a Delaware corporation and changed the Company's name fromBluegentech LLC to Nikola Corporation. In connection with the LLC Conversion, all of the Company's outstanding membership units were converted into shares of common stock and redeemableconvertible preferred stock. Upon the LLCConversion, each then-outstanding membership unit was converted into 10,000 shares of common stock or redeemable convertible preferred stock, with a par value $0.00001 per share.

Shares Authorized and Outstanding

        As of December 31, 2019 the Company had authorized a total of 366,651,920 shares for issuance with 237,000,000 shares designated ascommon shares and 129,651,920 shares designated as preferred shares.

Redeemable Convertible Preferred Stock

        In July 2015, the Company raised $2.0 million through the issuance of 4,000 LLC membership units to a seed investor (the "SeedInvestor").

        InDecember 2015, a related party investor purchased 2,998 of the 4,000 LLC membership units in a transaction that did not involve the Company. Upon the LLC conversion, theSeed Investor's remaining 1,002 units were converted into 10,020,000 shares of Series AA redeemable convertible

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Notes to Consolidated Financial Statements (Continued)

8. CAPITAL STRUCTURE (Continued)

preferredstock. Also, upon the LLC Conversion, the 2,998 units purchased by the related party investor were converted into 29,980,000 shares of Series BB redeemable convertiblepreferred stock.

        FromDecember 2015 to January 2017, the Company closed several rounds of Series A preferred stock funding. The Company raised $13.6 million through the issuance ofapproximately 452 LLC Preferred Units at $30,000 per unit. Upon the LLC Conversion, the LLC Preferred Units were converted into 4,523,337 shares of Series A redeemableconvertible preferred stock. In fiscal year 2017, the Company issued 339,999 shares of Series A redeemable convertible preferred stock for proceeds of $1.0 million. There were noissuance costs incurred. In addition, 333,334 redeemable convertible preferred stock warrants were exercised for an equal number of Series A redeemable convertible preferred stock.

        InSeptember 2017, the Company completed the initial closing of its Series B redeemable preferred stock financing in which it raised $34.0 million. The Company raised anadditional $10.0 million in a subsequent round of Series B redeemable convertible preferred stock in December 2017, resulting in an aggregate of $44.0 million gross proceedsraised through the sale and issuance of 5,692,108 Series B redeemable convertible preferred stock at $7.73 per share. There were no issuance costs incurred with respect to the issuance of theseSeries B redeemable convertible preferred stock.

        InAugust 2018, the Company completed the initial closing of its Series C financing in which it raised $100.0 million. The Company raised an additional$116.0 million in subsequent closings through December 2018, resulting in an aggregate of $216.0 million raised through the sale and issuance of 25,145,519 Series C redeemableconvertible preferred stock at $8.59 per share. The Company incurred $7.0 million in issuance costs, of which $2.0 million was non-cash and issued in Series C redeemableconvertible preferred stock. As such, the Company received aggregate net proceeds of $209.0 million.

        InNovember 2018, the Company repurchased 517,464 shares of Series B redeemable convertible preferred stock at $8.05 per share for a total purchase price of $4.2 millionrelated to this transaction. The repurchased redeemable convertible preferred stock was retired immediately thereafter. The repurchase price in excess of the carrying value of redeemable convertiblepreferred stock of $0.2 million was recorded as a reduction to additional paid-in capital, while the carrying value of the shares repurchased was recorded as a reduction to redeemableconvertible preferred stock. For the computation of net loss per share for the year ended December 31, 2018, the repurchase price in excess of the carrying value of the redeemable convertiblepreferred stock of $0.2 million is reflected as a decrease to net loss attributable to common stockholders (see Note 13).

        InSeptember and October 2019, the Company completed the initial closing of its Series D redeemable convertible preferred stock financing in which an aggregate of 3,509,721Series D redeemable convertible preferred stock was issued at $18.52 per share. The Series D financing resulted in gross proceeds of $65.0 million, incurring $4.7 millionin issuance costs. As such, the Company received aggregate net proceeds of $60.3 million. As of December 31, 2019, the $4.7 million issuance costs is included in accrued expensesand other current liabilities. The Company also received a license valued at $50.0 million and in-kind services valued at $8.0 million from the sale and issuance of an additional3,131,781 shares of Series D redeemable convertible preferred stock.

        InOctober 2019, the Company repurchased 1,880,984 shares of Series B redeemable convertible preferred stock at $16.67 per share for an aggregate purchase price of$31.4 million. The repurchased redeemable convertible preferred stock was retired immediately thereafter. The repurchase price in

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Notes to Consolidated Financial Statements (Continued)

8. CAPITAL STRUCTURE (Continued)

excessof the carrying value of redeemable convertible preferred stock of $16.8 million was recorded as a reduction to additional paid-in capital and accumulated deficit, while the carryingvalue of the shares repurchased was recorded as a reduction to redeemable convertible preferred stock. For the computation of net loss per share for the year ended December 31, 2019, therepurchase price in excess of the carrying value of the redeemable convertible preferred stock of $16.8 million is reflected as a decrease to net loss attributable to common stockholders (seeNote 13).

        Priorto the exercise of the Series A redeemable convertible preferred stock warrants, the Company remeasured the liability and recognized the loss as a component of other income(expense) on the consolidated statements of operations. The Company recorded the exercise of the warrants by reclassifying the liability to additional paid-in capital.

        InDecember 2019, Series A redeemable convertible preferred stock warrants were exercised for 720,000 shares of Series A redeemable convertible preferred stock at a priceof $3.00 per share, resulting in aggregate proceeds of $2.2 million.

        Thefollowing table summarizes the shares authorized, issued, and outstanding, price per share, net carrying value, and liquidation preference of the redeemable convertible preferredstock of the Company as of December 31, 2019:

        Thefollowing table summarizes the shares authorized, issued, and outstanding, price per share, net carrying value, and liquidation preference of the redeemable convertible preferredstock of the Company as of December 31, 2018:

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Notes to Consolidated Financial Statements (Continued)

8. CAPITAL STRUCTURE (Continued)

        Theholders of redeemable convertible preferred shares have various rights, privileges and preferences as follows:

Conversion

        Redeemable convertible preferred shares are convertible at any time and at the option of the holder into that number of fully-paid andnon-assessable common shares determined by dividing the original issue price of the redeemable convertible preferred shares by the conversion price in effect on the date of conversion (currently a 1:1ratio), subject to adjustments for stock dividends, combinations and similar events and anti-dilution events.

        Uponthe earlier of (i) the closing of the sale of common shares to the public in a firm-commitment underwritten public offering pursuant to an effective registration statementunder the Securities Act of 1933, as amended, (a) in which the price per share is equal to at least $23.15 (subject to adjustment for stock splits and the like) or (ii) the writtenconsent of the holders of at least a majority of the thenoutstanding shares of Series A redeemable convertible preferred stock, Series B redeemable convertible preferred stock, Series C redeemable convertible preferred stock andSeries D redeemable convertible preferred stock, voting as a single class, then all outstanding preferred shares shall automatically be converted into common shares at the then applicableconversion price.

Dividends

        Redeemable convertible preferred shares are entitled to a dividend only when and if declared by the Company's board of directors. The Companyshall not declare, pay or set aside any dividends on any other class or series of capital stock unless the outstanding preferred shares first receive, or simultaneously receive, a dividend on eachoutstanding preferred share. No dividends have been declared to date as of December 31, 2019.

Voting

        On any matter presented to the stockholders of the Company for their action or consideration at any meeting of stockholders of the Company (orby written consent of stockholders in lieu of meeting), each holder of outstanding preferred shares are entitled to vote their preferred shares as if they had been converted to common. With respect tovoting for the board of directors, the holders of Series AA redeemable convertible preferred stock and Series BB redeemable convertible preferred stock voting together as a class, areentitled to elect two directors of the Company. The holders of Series A redeemable convertible preferred stock voting as a separate class, are entitled to elect one director of the Company. Theholders of Series C redeemable convertible preferred stock voting as a separate class, are entitled to elect two directors of the Company. The holders of Series D redeemable convertiblepreferred stock voting as a separate class, are entitled to elect one director of the Company. The holders of common stock voting together as a class, are entitled to elect three directors of theCompany.

Liquidation

        The Series D redeemable convertible preferred stock have a senior liquidation preference to the Series C redeemable convertiblepreferred stock, which have liquidation preference to the Series B redeemable convertible preferred stock, which have liquidation preference to the Series A redeemable

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Notes to Consolidated Financial Statements (Continued)

8. CAPITAL STRUCTURE (Continued)

convertiblepreferred stock, the Series BB redeemable convertible preferred stock, the Series AA redeemable convertible preferred stock. The Series BB redeemable convertiblepreferred shares and Series AA redeemable convertible preferred stock are referenced herein as the Series Seed redeemable convertible preferred stock. The Series A redeemable convertiblepreferred stock and the Series Seed redeemable convertible preferred stock have liquidity preference to the common shares in the event of any voluntary or involuntary liquidation, dissolution orwinding up of the Company.

        Ifupon liquidation, dissolution or winding up of the Company, the assets available for distribution are not sufficient to pay Series D redeemable convertible preferredshareholders the full amount they are entitled, the Series D redeemable convertible preferred shareholders shall share, in accordance with their specific share class rights, any distributionproportionally.

        Afterthe preferential payments satisfy the Series D redeemable convertible preferred stock, Series C redeemable convertible preferred stock are eligible for any remainingdistributions until they are fully satisfied which requires a distribution for an amount equal to 100% of the original issue price of the Series C share class and if applicable, an amount equalto any dividends declared but unpaid thereon.

        Afterthe Series C share class is fully satisfied, the Series B redeemable convertible preferred shares are eligible for any remaining distributions until they are fullysatisfied which requires a distribution for an amount equal to 100% of the original issue price of the Series B share class and if applicable, an amount equal to any dividends declared butunpaid thereon.

        Afterthe Series B share class is fully satisfied, the Series A redeemable convertible preferred shares and Series Seed redeemable convertible preferred shares are eligiblefor any remaining distributions until they are fully satisfied which requires a distribution for an amount equal to 105% of the original issue price of the Series A share class and the originalissue price of the Series Seed share class and if applicable, an amount equal to any dividends declared but unpaid thereon.

        Ifupon any such liquidation, dissolution or winding up of the Company, the assets of the Company available for distribution to its stockholders shall be insufficient to pay the holdersof a security class, proceeds are to be distributed pro-rata based on ownership of the share class.

        Afterthe distribution of the preferential amounts to preferred shareholders, the remaining assets of the Company shall be distributed pro-rata among the Series C share class andcommon share class based onthe number of shares held by each such holder, treating all securities as if they had converted to common shares.

Redemption

        The Company's preferred shares are not redeemable at the option of the holders. However, the holders of preferred shares may request that theCompany redeem all outstanding preferred shares in accordance with their liquidation preferences in the event of a deemed liquidation event in which the Company does not effect a dissolution of theCompany under Delaware General Corporation Law within 90 days after such deemed liquidation event. Deemed liquidation events are defined to include (i) a merger or consolidation in whichthe Company is a constituent party, (ii) sale or transfer of substantially all of the Company's assets, or (iii) a "change in control" transaction in which current stockholders' controlless than 50% of the voting power of the entity resulting from the transaction. Accordingly, these shares are considered contingently redeemable and are classified as temporary equity

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Notes to Consolidated Financial Statements (Continued)

8. CAPITAL STRUCTURE (Continued)

onour consolidated balance sheets and in the statement of redeemable convertible preferred stock and stockholders' deficit. We recognize changes in the redemption value of the redeemable convertiblepreferred stock when a deemed liquidation event becomes probable. Any adjustment to the carrying amount of the applicable class of redeemable convertible preferred stock is recorded as a deemeddividend from additional paid-in-capital or an adjustment of the accumulated deficit to equal the redemption value at the end of each reporting period. The shares of redeemable convertible preferredstock have not been accreted as of December 31, 2019 as a deemed liquidation event is not probable of occurring.

        CertainSeries B and Series C redeemable convertible preferred stock issued to a related party had additional redemption rights as of December 31, 2019. SeeNote 6 "Related Party Transactions" for more details.

Series A Redeemable Convertible Preferred Stock Warrants

        In February 2016, the Company issued 3,340,550 warrants exercisable into Series A redeemable convertible preferred stock at a price of$3.00 per share. These warrants were originally set to expire in August 2017, however the term related to these warrants was extended through March 2018. During 2017, 333,334 of these warrants wereexercised and the remaining 3,007,216 went unexercised and expired in March 2018, resulting in a gain on expiration of the warrants of $2.8 million, which was recorded in the consolidatedstatements of operations.

        InDecember 2016 and March 2017 the Company issued 670,000, and 50,000 warrants, respectively, which were exercisable into Series A redeemable convertible preferred stock at aprice of $3.00 per share. These warrants were originally set to expire in January 2018, however the term of these warrants was extended through December 2019. All of the warrants were exercised onDecember 31, 2019.

9. STOCK-BASED COMPENSATION EXPENSE

Stock Option Plan

        The Nikola Corporation 2017 Stock Option Plan (the "2017 Plan") provides for the grant of incentive and nonqualified options to purchase theCompany's common stock to select officers, key employees, directors, and consultants. Options are granted at a price not less than the fairmarket value on the date of grant and generally become exercisable between one and four years after the date of grant. Options generally expire ten years from the date of grant.

2017 Stock Option Exchange

        On July 11, 2017, the Company commenced a voluntary employee stock option exchange program (the "2017 Exchange") to permit the Company'seligible employees to exchange some or all of their eligible membership units ("Original Units") for stock options. All 21 eligible employees participated in the stock option exchange whereby 100% oforiginal units were converted into stock options issued under the 2017 Plan.

        Inaccordance with the terms and conditions of the 2017 Exchange, on July 11, 2017, the Company exchanged all Original Unit grants for stock options with an exercise price of$3.00 per share. In addition to the exchange, an aggregate of 3,323,300 newly issued options with an exercise price of $3.00 were issued to offset the potential loss of value resulting from theexchange. In general, 25% of the new options vest on the anniversary of the grant date, with the remaining 75% vesting ratably each month over the next 36 months.

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Notes to Consolidated Financial Statements (Continued)

9. STOCK-BASED COMPENSATION EXPENSE (Continued)

        The incremental fair value of the new options over the Original Units is recognized as stock-based compensation expense. On the date of the exchange, the fair value of the new optionsexceeded the fair value of the original units by $1.5 million of which $0.7 million was recognized in the consolidated statements of operations in 2017.

2018 Stock Option Modification

        On October 17, 2018, the Company commenced a voluntary employee stock option modification program (the "2018 Modification") to modify thestrike price of certain employee options that were granted as part of the 2017 Exchange. Under the 2018 Modification the strike price of all stock options subject to the modification was changed from$3.00 to $2.00 to reflect the grant date fair value for each award based on a third-party 409(a) valuation dated August 3, 2018. All 62 eligible employees participated in the stock optionexchange whereby 100% of Original Units were modified as described herein. As a result, 100% of the options issued as part of the 2017 Exchange were cancelled in favor of awards granted onOctober 17, 2018 with a strike price of $2.00 per share, appropriately reflecting grant date fair value.

        Theincremental fair value of the new options is recognized as stock-based compensation expense. On the date of the exchange, the fair value of the new options exceeded the fair value ofold options by $2.3 million, of which $1.7 million was recognized in the consolidated statements of operations in 2018. The Company will recognize the remaining unrecognized compensationcost related to the 2018 Modification over the requisite service period of the new options.

Common Stock Valuation

        The fair value of the common stock that underlies the stock options is determined by the board of directors based upon information available atthe time of grant. Because there is no public market for the common stock, the Company's board of directors determined the fair value of the Company's common stock based on periodic valuation studiesfrom an independent third-party valuation firm.

        Inperforming its valuation analysis, the valuation firm engaged in discussions with management, evaluated key milestone achievements, analyzed historical and forecasted financialstatements and reviewed corporate documents. In addition, these valuation studies were based on a number of assumptions, including industry, general economic, market and other conditions that couldreasonably be evaluated at the time of the valuation.

Stock Option Valuation

        The Company utilizes the Black-Scholes option pricing model for estimating the fair value of options granted, which requires the input of highlysubjective assumptions.

        TheCompany calculates the fair value of each option grant on the grant date using the following assumptions:

Expected Term—The Company uses the simplified method when calculating expected term due to insufficient historical exercise data.

Expected Volatility—As the Company's shares are not actively traded, the volatility is based on a benchmark of comparable companies withinthe automotive and energy storage industries.

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Notes to Consolidated Financial Statements (Continued)

9. STOCK-BASED COMPENSATION EXPENSE (Continued)

Expected Dividend Yield—The dividend rate used is zero as the Company does not have a history of paying dividends on its common stock anddoes not anticipate doing so in the foreseeable future.

Risk-Free Interest Rate—The interest rates used are based on the implied yield available on U.S. Treasury zero-coupon issues with anequivalent remaining term equal to the expected life of the award.

        Thefollowing table presents the impact of stock-based compensation expense on the consolidated statements of operations for the years ending December 31, 2019, 2018 and 2017,respectively:

        Theunrecognized compensation cost of stock options as of December 31, 2019 was $11.8 million, which is expected to be recognized over the weighted average remainingservice period of 3.1 years. As of December 31, 2019, there were 12,779,652 shares available for future issuance under the 2017 Plan.

Performance Based Stock Option Grants

        As of December 31, 2019, 2018, and 2017, the outstanding performance-based options ("PSUs") issued by the Company were 2,710,934,2,960,934 and 3,260,934, respectively. No PSUs were granted in fiscal year 2019. The 2,710,934 PSUs outstanding as of December 31, 2019 have a vesting condition based on the achievement ofspecified amounts of equity capital raised by the Company subsequent to the grant date. These PSUs generally vest in equal amounts at the one-year and two-year anniversary of the performanceachievement date.

        Asof December 31, 2018, the performance-based provision was achieved for all of the outstanding performance-based award and the Company began recognizing expense related to thesePSUs in 2018. The Company recognized stock-based compensation expense of $1.7 million, $1.1 million, and zero in the years ended December 31, 2019, 2018, and 2017, respectivelyrelated to these PSUs, which is recognized in selling, general, and administrative on the consolidated statements of operations.

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Notes to Consolidated Financial Statements (Continued)

9. STOCK-BASED COMPENSATION EXPENSE (Continued)

        The2,710,934 and 2,960,934 PSUs outstanding as of December 31, 2019 and 2018, respectively, does not include PSUs issued by a related party. See Note 6,"Related Party Transactions" for additional information regarding the related party PSUs.

Option Activity

        Changes in stock options are as follows:

        Theoption activity above does not include the PSUs issued by the related party. The weighted-average grant date fair value of stock options issued for the years endedDecember 31, 2019, 2018 and 2017 were $1.42, $0.75 and $0.47, respectively.

        Therewere 667 stock options exercised during the year ended December 31, 2019 and the total intrinsic value of stock options exercised is immaterial. There were no stock optionsexercised during the years ended December 31, 2018 and 2017. The fair value of awards vested in 2019, 2018 and 2017 was $4.3 million, $4.0 million and $5.1 million,respectively.

Related Party Performance-Based Stock Options Activity

        In December 2018, M&M Residual, LLC, a Nevada limited liability company owned by Trevor R. Milton, Nikola's CEO issued 3,158,949 PSUs tocertain employees. The weighted average exercise price per share was $2.00 and the weighted-average grant date fair value of these PSUs was $1.19. There were no PSUs issued by the CEO in the yearsended December 31, 2019 and December 31, 2017. As of December 31, 2019, the weighted average remaining contractual term of these PSUs is 9 years and the aggregate intrinsicvalue of these PSUs is $15.2 million. There were no PSUs vested or exercised as of December 31, 2019.

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Notes to Consolidated Financial Statements (Continued)

10. RETIREMENT SAVINGS PLAN

        The Company sponsored a savings plan available to all eligible employees, which qualifies under Section 401(k) of the Internal Revenue Code. Employees may contribute to the planamounts of their pre-tax salary subject to statutory limitations. The Company does not currently offer a company match and has not provided a match for the years ended December 31, 2019, 2018and 2017.

11. INCOME TAXES

        A provision (benefit) for income taxes of $0.2 million, ($2.0) million and ($1.6) million has been recognized for the years ended December 31, 2019, 2018 and 2017,respectively, related primarily to changes in indefinite-lived intangible and goodwill deferred tax liabilities.

        Thecomponents of the provision for income taxes for the years ended December 31, 2019, 2018 and 2017 consisted of the following:

        Sinceinception, through July 11, 2017, the Company was a Delaware LLC and elected to file as a partnership for federal and state income tax purposes. Taxable losses frominception through July 11, 2017 were allocated to the members in accordance with the LLC operating agreement. Accordingly, income taxes were not provided for any period prior toJuly 11, 2017, as those losses were included in the members' federal income tax returns. On July 11, 2017, the Company converted from a Delaware LLC to a Delaware corporation, andfiled a corporate income tax return for the period July 11, 2017 through December 31, 2017. For tax purposes, the Company elected to be treated as a corporation under Subchapter Cof Chapter 1 of the United States Internal Revenue Code, effective July 11, 2017. Therefore, the Company was subject to federal and state income taxes beginning July 11, 2017.

        OnDecember 22, 2017, the U.S. enacted significant changes to U.S. tax law following the passage and signing of H.R. 1, "An Act to Provide for Reconciliation Pursuant to Titles IIand V of the Concurrent Resolution of the Budget for Fiscal Year 2018" (the "Tax Act"). Most of the changes introduced in the Tax Act were effective beginning on January 1, 2018. Deferred taxassets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. As of December 31, 2017, the Company re-measured the applicable deferred taxassets and liabilities based on the newly enacted rates and recorded a benefit of $1.6 million for the year ended December 31, 2017.

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NIKOLA CORPORATION

Notes to Consolidated Financial Statements (Continued)

11. INCOME TAXES (Continued)

        Inconjunction with the Tax Act, the SEC staff issued Staff Accounting Bulletin No. 118 ("SAB 118") to address the application of GAAP in situations when a public orprivate company does not have the necessary information available, prepared, or analyzed (including computations) in reasonable detail to complete the accounting for certain income tax effects of theTax Act. Based on this guidance, the Company computed provisional amounts for the tax impacts related to the revaluation of deferred tax assets and liabilities and included these amounts in itsconsolidated financial statements for the year ended December 31, 2017. During 2018, the Company completed its accounting for the Tax Act which resulted in no material changes to theprovisional amounts.

        Deferredtax assets (liabilities) as of December 31, 2019 and 2018 consisted of the following:

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Notes to Consolidated Financial Statements (Continued)

11. INCOME TAXES (Continued)

        Inaccordance with ASC 740-10, the deferred tax assets are reduced by a valuation allowance if it is not more likely than not that some portion or all the deferred tax assets will berealized. The realization of deferred tax assets can be affected by, among other things, the nature, frequency, and severity of current and cumulative losses, forecasts of future profitability, thelength of statutory carryforward periods, the Company's experience with utilizing operating losses and tax credit carryforwards by jurisdiction, and tax planning alternatives that may be available.

        TheCompany performed an analysis of the reversal of the deferred tax liabilities, and then considered the overall business environment, and the outlook for future years. The Companydetermined that it is not more likely than not that the benefit from deferred tax assets net of the reversal of certain deferred tax liabilities will be realized. In recognition of this risk, theCompany recorded valuation allowances of $47.7 million and $19.8 million at December 31, 2019 and 2018, respectively. The increase in the valuation allowance for the years endedDecember 31, 2019 and 2018 was primarily due to increase in operating loss carryforwards.

        AtDecember 31, 2018, the Company had federal net operating loss carryforwards of $11.2 million that begin to expire in 2037 and $150.3 million that have anindefinite carryforward period. The Company has combined state net operating loss carryforwards of $194.0 million at December 31, 2019, that begin to expire in 2032. The utilization ofsome of these net operating losses may also be subject to annuallimitations due to ownership change rules under the Internal Revenue Code Sections 382 and 383. The Company has tax credits of $7.5 million at December 31, 2019, which if unusedwill begin to expire in 2031 for state and 2037 for federal tax purposes. The following table reflect changes in the unrecognized tax benefits:

        EffectiveJuly 11, 2017, the Company adopted the provisions of ASC Topic 740, Income Taxes. ASC Topic 740 provides that a taxbenefit from an uncertain tax position may be recognized when it is more-likely-than-not that the position will be sustained in a court of last resort, based on the technical merits. Ifmore-likely-than-not, the amount recognized is the largest amount of tax benefit that is greater than 50% likely of being realized on examination, including compromise settlements. For tax positionsnot meeting the more-likely-than-not threshold, no tax benefit is recorded.

        Asof December 31, 2019, 2018, and 2017, the Company had $0.4 million, $0.1 million, and $0.1 million, respectively, of gross unrecognized tax benefits,related to research and experimental tax credits. The Company had no unrecognized tax benefits as of December 31, 2019, which, if recognized, would affect the annual effective tax rate, due tothe full valuation allowance on the deferred tax assets. The Company does not expect a significant change to the amount of unrecognized tax benefits to occur within the next 12 months.

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Notes to Consolidated Financial Statements (Continued)

11. INCOME TAXES (Continued)

        TheCompany's policy is to recognize interest and penalties related to income tax matters in income tax expense. The Company had no accrual for interest or penalties atDecember 31, 2019 or 2018, and hasnot recognized interest or penalties during the years ended December 31, 2019 and 2018, since there was no reduction in income taxes paid due to uncertain tax positions.

        TheCompany files income tax returns in the United States, Arizona, California, and Utah. As of December 31, 2019, the earliest year subject to examination is 2017 for federal andstate tax purposes. In addition, due to the Company's tax attribute carryforwards, tax authorities will continue to have the ability to adjust loss and tax credit carryforwards even after the statuteexpires on the year in which the attributes were originally claimed.

12. COMMITMENTS AND CONTINGENCIES

Legal Proceedings

        The Company is subject to legal and regulatory actions that arise from time to time in the ordinary course of business. The assessment as towhether 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. In the opinion ofmanagement, there was not at least a reasonable possibility the Company may have incurred a material loss with respect to loss contingencies for asserted legal and other claims. However, the outcomeof litigation is inherently uncertain. There is no material pending or threatened litigation against the Company that remains outstanding as of December 31, 2019.

Salt Lake City Lease Agreement

        The Company was obligated under a lease agreement for office space and warehouse space, with payments ranging from $14 thousand to$15 thousand per month throughout the lease term. This lease expired in October 2018. In connection with this lease, the Company was also obligated to pay its proportionate share of theoperating expenses and real estate taxes of the facilities.

        Rentexpense under this operating lease was zero, $0.1 million and $0.1 million for the years ended December 31, 2019, 2018, and 2017, respectively.

Phoenix Headquarters Lease Agreement

        In February 2018, the Company entered into a non-cancellable lease agreement and purchase option for a headquarters and R&D facility in Phoenix,Arizona. The term of the lease is 141 months commencing in September 2018 and ending in June 2030. The Company also has the option to extend the lease for two additional five-year periods.During the first 36 months of lease, the Company has the option to purchase the building for a price of between $23.7 million and $25.1 million depending on the time of purchasefrom the lease commencement date.

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Notes to Consolidated Financial Statements (Continued)

12. COMMITMENTS AND CONTINGENCIES (Continued)

        Ifthe purchase option is not exercised, total future minimum lease payments over the term of the lease are as follows:

        InJune 2018, the Company began construction on several significant building expansion and improvement projects in-order to meet the Company's requirements. Construction on the Company'sheadquarters was substantially completed in the third quarter of 2019 and the related asset was placed in service in September 2019.

        Becausethe Company was involved in certain aspects of the construction per the terms of the lease, the Company was deemed the owner of the building for accounting purposes during theconstruction period. Accordingly, as of December 31, 2019 the Company recorded a build-to-suit lease asset of $33.2 million in property and equipment, net, which includes building costspaid by the Company of $20.8 million, with a $11.7 million financing liability recorded in other non-current liabilities and $0.7 million liability recorded in accrued liabilitieson the consolidated balance sheet.

Chandler Lease Agreement

        In July 2018, the Company entered into a 12-month lease agreement for a temporary workspace in Chandler, Arizona while the Company'sheadquarters underwent improvements. The Company exited the lease in June 2019.

        Rentexpense under this lease was $0.1 million, $0.1 million and zero for the years ended December 31, 2019, 2018, and 2017, respectively.

Purchase Commitments

        The Company enters into commitments under non-cancelable or partially cancellable purchase orders or vendor agreements in the normal course ofbusiness. The following tables presents the Company's commitments and contractual obligations as of December 31, 2019:

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Notes to Consolidated Financial Statements (Continued)

12. COMMITMENTS AND CONTINGENCIES (Continued)

Commitments and Contingencies on Land Conveyance

        In February 2019, the Company was conveyed 430 acres of land in the city of Coolidge, Arizona by Pinal Land Holdings, LLC ("PLH"). Thepurpose of the land conveyance was to incentivize the Company to locate their manufacturing facility in Coolidge and provide additional jobs to the region. The Company is required to commenceconstruction of the manufacturing facility within two years of February 2019 (the "Manufacturing Facility Commencement Deadline"), and is required to complete construction of their manufacturingfacility within five years of February 2019 (the "Manufacturing Facility Deadline").

        Uponthe earlier of the Manufacturing Facility Commencement Deadline or the commencement of construction, the Company will deposit $4.0 million in escrow to PLH. The amount inescrow will be returned to the Company upon completion of construction.

        Ifthe Company fails to achieve the Manufacturing Facility Commencement Deadline, the Company has the option to extend the deadline for one year by providing written notice to PLH andpaying PLH $0.5 million. In the event the Company fails to achieve extended deadline, PLH is entitled to either the $4.0 million security deposit, or to purchase the 430 acres of landfrom the Company at a price equal to out of pocket costs and expenses incurred by the Company prior to the Manufacturing Facility Commencement Deadline.

        Ifthe Company fails to achieve the Manufacturing Facility Deadline, the Company may extend the completion deadline by paying PLH $0.2 million per month, until construction iscompleted. 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 maketimely 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 ormay reacquire the land and property at the appraised value to be determined by independent appraisers selected by the Company and PLH.

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Notes to Consolidated Financial Statements (Continued)

13. NET LOSS PER SHARE

        The following table sets forth the computation of the basic and diluted net loss per share attributable to common stockholders for the years ended December 31, 2019, 2018, and2017.

        Sincethe Company was in a loss position for all periods presented, basic net loss per share is the same as diluted net loss per share for all periods as the inclusion of all potentialcommon shares outstanding would have been anti-dilutive.

        Thefollowing weighted-average outstanding common stock equivalents were excluded from the computation of diluted net loss per share attributable to common stockholders for the periodspresented because including them would have been anti-dilutive.

14. SUBSEQUENT EVENTS

        In connection with the issuance of the December 31, 2019 audited financial statements, subsequent events were evaluated through May 1, 2020.

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14. SUBSEQUENT EVENTS (Continued)

        Inthe first fiscal quarter of 2020, the Company closed subsequent tranches of its Series D preferred stock financing in which it raised an additional $13.3 million.

        InFebruary 2020, the Company extended its term note with JP Morgan Chase. See Note 7, "Debt" to these consolidated financial statements for additional details.

        InFebruary 2020, the Company and CNHI amended the Series D Purchase Agreement for future sales and issuances of Series D redeemable convertible preferred stock to CNHI andits affiliates. The Company will issue CNHI and its affiliates the remaining previously committed shares of Series D redeemable convertible preferred stock in exchange for cash and in-kindservices by the second quarter of 2020.

        InFebruary 2020, the Company entered into an agreement with a consultant for the marketing of FCEV/BEV hybrid pickup truck. Under the agreement, should the Company accept reservationfees from prospective customers to purchase one or more pickup trucks, for every $100 in reservation fees, the Company will issue 10 shares of common stock to the consultant for up to a maximum of2,000,000 shares. The Company also agreed to reimburse the consultant up to $5.0 million in marketing costs.

        InMarch 2020, the Company entered into a business combination agreement (the "Business Combination") with VectoIQ Acquisition Corp ("VectoIQ") , where the Company will merge with asubsidiary of VectoIQ, with Nikola surviving the merger as a wholly-owned subsidiary of VectoIQ.

        InMarch 2020, the Company agreed to repurchase 1,499,700 shares of Series B redeemable convertible preferred stock from a related party at $16.67 per share for an aggregatepurchase price of $25.0 million upon the earliest to occur of the Business Combination or the sale of additional shares of Series D redeemable convertible preferred stock of at least$50.0 million. In addition, the Company entered into a commercial side letter with the same related party whereby the Company agreed to pay a minimum of $50.0 million for outsideengineering services over a five year period. This agreement modified and replaced the Nimbus Redemption Letter Agreement the Company had with the related party. Concurrently, the agreement terminatedthe redemption rights held by the related party. See Note 6, "Related Party Transactions" for more details.

        InApril 2020, the Company and Iveco entered into a series of agreements which established a joint venture in Europe, Nikola Iveco Europe B.V. The operations expected to beperformed by the joint venture consist of the development and manufacturing of the BEV and FCEV trucks for the European market, as well as for the North American market while Nikola's greenfieldmanufacturing facility in Coolidge, Arizona is being completed. The operations of the joint venture are expected to commence in the third quarter of fiscal 2020.

        Theagreements 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 Nikola and Iveco. Both parties areentitled to appoint an equal number of board members to the board of Nikola Iveco Europe B.V. Pursuant to the terms of the agreements, the Company and Iveco each contributed intellectualproperty licenses to their respective technology, and agreed to contribute approximately $8.0 million in cash for a 50.0% interest in Nikola Iveco Europe B.V. The intellectual propertylicenses contributed to the joint venture by Nikola are related to intellectual property related to Nikola-developed BEV and FCEV technology for the use in the European market. Iveco contributed tothe joint venture a license for the S-WAY technology for use in the European market.

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Notes to Consolidated Financial Statements (Continued)

14. SUBSEQUENT EVENTS (Continued)

        TheCompany is in the process of evaluating the joint venture under ASC Topic 810-10, Consolidations. The Company will complete theanalysis and plans to disclose the accounting for the joint venture in its financial statements for the quarter ending June 30, 2020.

        InApril 2020, the Company entered into a Note with JP Morgan Chase under the Small Business Administration Paycheck Protection Program established under Section 1102 of theCoronavirus Aid, Relief and Economic Security (CARES) Act, pursuant to which the Company borrowed $4.1 million. The Note accrues interest at rate of 0.98% per annum and matures in24 months.

        OnApril 30, 2020, the Company returned the $4.1 million in proceeds from the Note to JP Morgan Chase, originally obtained under the Small Business Administration PaycheckProtection Program.

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Condensed Balance Sheets

   

See accompanying notes to condensed financial statements.

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CONDENSED STATEMENT OF OPERATIONS

(Unaudited)

   

See accompanying notes to condensed financial statements.

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CONDENSED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY

For the three months ended March 31, 2020

(Unaudited)

   

See accompanying notes to condensed financial statements.

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CONDENSED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY

For the three months ended March 31, 2019

(Unaudited)

   

See accompanying notes to condensed financial statements.

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CONDENSED STATEMENTS OF CASH FLOWS

(Unaudited)

   

See accompanying notes to condensed financial statements.

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Notes to Condensed Financial Statements

(Unaudited)

NOTE 1—DESCRIPTION OF ORGANIZATION AND BUSINESS OPERATIONS

        VectoIQ Acquisition Corp. (the "Company") was incorporated in Delaware on January 23, 2018. The Company was formed for the purpose of effecting a merger, share exchange, assetacquisition, stock purchase, recapitalization reorganization or similar business combination with one or more businesses (the "Initial Business Combination"). Although the Company is not limited to aparticular industry or sector for purposes of consummating an Initial Business Combination, the Company intends to focus its search on the industrial technology, transportation and smart mobilityindustries. The Company is an emerging growth company and, as such, the Company is subject to all of the risks associated with emerging growth companies.

        Inthe opinion of management, the unaudited condensed consolidated financial statements furnished in this Registration Statement on Form S-1 include all adjustments necessary fora fair presentation of the financial position, results of operations and cash flows for the interim periods presented. All such adjustments are of a normal recurring nature.

        Asof March 31, 2020, the Company had not commenced operations. All activity for the period from January 23, 2018 (inception) through March 31, 2020 relates to theCompany's formation and its initial public offering described below, and since the closing of its initial public offering, a search for a Business Combination candidate. The Company will not generateany operating revenues until after the completion of its Initial Business Combination, at the earliest. The Company will generate non-operating income in the form of interest income on cash and cashequivalents and investments from the proceeds derived from its initial public offering. The Company has a December 31 year end.

        TheCompany's sponsor is VectoIQ Holdings, LLC, a Delaware limited liability company (the "Sponsor").

        Theregistration statement for the Company's initial public offering was declared effective May 15, 2018. On May 18, 2018, the Company consummated an initial publicoffering of 20,000,000 units (each, a "Unit" and collectively, the "Units") at $10.00 per Unit, which is discussed in Note 3. Simultaneously with the closing of the initial public offering, theCompany consummated the sale of 800,000 units (each, a "Private Placement Unit" and collectively, the "Private Placement Units") at a price of $10.00 per Private Placement Unit in a private placementto the Sponsor, Cowen Investments, LLC (collectively with the Sponsor, the "Founders") and certain funds and accounts managed by subsidiaries of BlackRock, Inc. (collectively, the"Anchor Investor").

        Followingthe closing of the initial public offering on May 18, 2018, an amount of $202,000,000 ($10.10 per Unit) from the net proceeds of the sale of the Units in the initialpublic offering and the Private Placement Units was placed in a trust account ("Trust Account") which was invested in U.S. government securities, within the meaning set forth inSection 2(a)(16) of the Investment Company Act of 1940, as amended (the "Investment Company Act"), with a maturity of 180 days or less or in any open-ended investment company that holdsitself out as a money market fund selected by the Company meeting the conditions of Rule 2a-7 of the Investment Company Act, as determined by the Company, until the earlier of: (i) theconsummation of a Business Combination or (ii) the distribution of the Trust Account, as described below.

        OnMay 24, 2018, the underwriters notified the Company of their exercise of the over-allotment option in full and, on May 29, 2018, purchased 3,000,000 additional Units(the "Additional Units") at $10.00 per Additional Unit upon the closing of the over-allotment option, generating total gross

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Notes to Condensed Financial Statements (Continued)

(Unaudited)

NOTE 1—DESCRIPTION OF ORGANIZATION AND BUSINESS OPERATIONS (Continued)

proceedsof $30,000,000. On May 29, 2018, simultaneously with the sale of the Additional Units, the Company consummated the sale of an additional 90,000 Private Units at $10.00 per additionalPrivate Unit (the "Additional Private Units"), generating total gross proceeds of $900,000. Following the closing of the over-allotment option, an additional $30,300,000 ($10.10 per Unit) was placedin the Trust Account, resulting in $232,300,000 ($10.10 per Unit) held in the Trust Account.

        Transactioncosts amounted to $5,244,622, consisting of $4,600,000 of underwriting fees, including underwriting fees resulting from the exercise of the underwriters' over-allotment, and$644,622 of initial public offering costs.

        TheCompany's management has broad discretion with respect to the specific application of the net proceeds of the initial public offering and the sale of Private Placement Units,although substantially all of the net proceeds are intended to be applied generally toward consummating a Business Combination. There is no assurance that the Company will be able to complete aBusiness Combination successfully. The Company must complete its Initial Business Combination with one ormore target businesses having an aggregate fair market value of at least 80% of the assets held in the Trust Account (excluding taxes payable on income earned on the Trust Account) at the time of theagreement to enter into the Initial Business Combination. However, the Company will only complete a Business Combination if the post-transaction company owns or acquires 50% or more of the outstandingvoting securities of the target or otherwise acquires a controlling interest in the target business sufficient for it not to be required to register as an investment company under the InvestmentCompany Act.

        TheCompany will provide its holders of the outstanding shares of its common stock, par value $0.0001, sold in the initial public offering (the "public stockholders") with theopportunity to redeem all or a portion of their Public Shares (as defined below in Note 3) upon the completion of an Initial Business Combination either (i) in connection with astockholder meeting called to approve the Initial Business Combination or (ii) by means of a tender offer. The decision as to whether the Company will seek stockholder approval of a BusinessCombination or conduct a tender offer will be made by the Company, solely in its discretion. The public stockholders will be entitled to redeem their Public Shares for a pro rata portion of the amountthen in the Trust Account (initially anticipated to be $10.10 per Public Share). These Public Shares are recorded at a redemption value and classified as temporary equity in accordance with theFinancial Accounting Standards Board's ("FASB") Accounting Standards Codification ("ASC") Topic 480 "Distinguishing Liabilities from Equity." The Company will proceed with an Initial BusinessCombination only if the Company has net tangible assets of at least $5,000,001 upon such consummation of a Business Combination and, if a stockholder vote is held to approve such transaction, only ifa majority of the shares voted are voted in favor of the Business Combination. If a stockholder vote is not required by law and the Company does not decide to hold a stockholder vote for business orother legal reasons, the Company will, pursuant to its Amended and Restated Certificate of Incorporation (the "Amended and Restated Certificate of Incorporation"), conduct the redemptions pursuant tothe tender offer rules of the U.S. Securities and Exchange Commission ("SEC") and file tender offer documents with the SEC prior to completing a Business Combination. If, however, stockholder approvalof the transactions is required by law, or the Company decides to obtain stockholder approval for business or legal reasons, the Company will offer to redeem shares in conjunction with a proxysolicitation pursuant to the proxy rules and not pursuant to the tender offer rules. Additionally, each public stockholder may elect to redeem their Public Shares without voting, and

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Notes to Condensed Financial Statements (Continued)

(Unaudited)

NOTE 1—DESCRIPTION OF ORGANIZATION AND BUSINESS OPERATIONS (Continued)

ifthey do vote, irrespective of whether they vote for or against the proposed transaction. If the Company seeks stockholder approval in connection with a Business Combination, the initialstockholders (as defined below) have agreed to vote their Founder Shares (as defined below in Note 4) and any Public Shares purchased during or after the initial public offering in favor of aBusiness Combination. In addition, the initial stockholders have agreed to waive their redemption rights with respect to their Founder Shares and Public Shares in connection with the completion of aBusiness Combination or any amendment to the provisions of the Company's Amended and Restated Certificate of Incorporation relating to its pre-Initial Business Combination activity and relatedstockholders' rights.

        Notwithstandingthe foregoing, the Amended and Restated Certificate of Incorporation provides that a public stockholder, together with any affiliate of such stockholder or any otherperson with whom such stockholder is acting in concert or as a "group" (as defined under Section 13 of the Securities Exchange Act of 1934, as amended (the "Exchange Act")), will be restrictedfrom redeeming its shares with respect to more than an aggregate of 15% of the common stock sold in the initial public offering, without the prior consent of the Company.

        TheCompany's Founders, officers and directors (the "initial stockholders") have agreed not to propose an amendment to the Amended and Restated Certificate of Incorporation that wouldaffect the substance or timing of the Company's obligation to redeem 100% of its Public Shares if the Company does not complete a Business Combination, unless the Company provides the publicstockholders with the opportunity to redeem their shares of common stock in conjunction with any such amendment.

        Ifthe Company does not consummate a Business Combination by May 18, 2020 (the "Combination Period"), it will (i) cease all operations except for the purpose of winding up,(ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem the Public Shares, at a per-share price, payable in cash, equal to the aggregate amount then ondeposit in the Trust Account including interest (less up to $100,000 of interest to pay dissolution expenses, and taxes that were not previously released from the trust and paid), divided by thenumber of then outstanding Public Shares, which redemption will completely extinguish public stockholders' rights as stockholders (including the right to receive further liquidating distributions, ifany), subject to applicable law, and (iii) as promptly as reasonably possible following such redemption, subject to the approval of the Company's remaining stockholders and the Company's boardof directors, dissolve and liquidate, subject in each case to the Company's obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law.

        Theinitial stockholders have agreed to waive their liquidation rights with respect to the Founder Shares if the Company fails to complete a Business Combination within the CombinationPeriod. However, if the initial stockholders should acquire Public Shares in or after the initial public offering, they will be entitled to liquidating distributions from the Trust Account withrespect to such Public Shares if the Company fails to complete a Business Combination within the Combination Period. In the event of such distribution, it is possible that the per share value of theresidual assets remaining available for distribution (including Trust Account assets) will be only $10.10 per share initially held in the Trust Account (or potentially less in certain circumstances).In order to protect the amounts held in the Trust Account, the Sponsor has agreed to be liable to the Company if and to the extent any claims

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Notes to Condensed Financial Statements (Continued)

(Unaudited)

NOTE 1—DESCRIPTION OF ORGANIZATION AND BUSINESS OPERATIONS (Continued)

bya vendor for services rendered or products sold to the Company, or a prospective target business with which the Company has discussed entering into a transaction agreement, reduce the amount offunds in the Trust Account. This liability will not apply with respect to any claims by a third party who executed a waiver of any right, title, interest or claim of any kind in or to any monies heldin the TrustAccount or to any claims under the Company's indemnity of the underwriters of the initial public offering against certain liabilities, including liabilities under the Securities Act. Moreover, in theevent that an executed waiver is deemed to be unenforceable against a third party, the Sponsor will not be responsible to the extent of any liability for such third-party claims. The Company will seekto reduce the possibility that the Sponsor will have to indemnify the Trust Account due to claims of creditors by endeavoring to have all vendors (other than the Company's independent auditors),service providers, prospective target businesses or other entities with which the Company does business, execute agreements with the Company waiving any right, title, interest or claim of any kind inor to monies held in the Trust Account.

        OnMarch 2, 2020, the Company entered into a business combination agreement (the "Business Combination Agreement") with VCTIQ Merger Sub Corp., a Delaware corporation andwholly-owned subsidiary of the Company ("Merger Sub"), and Nikola Corporation, a Delaware corporation ("Nikola"), pursuant to which the Company will effect a business combination with Nikola (the"Proposed Transaction"). See Note 3 for further discussion of the Proposed Transaction.

Going Concern

        In connection with the Company's assessment of going concern considerations in accordance with Financial Accounting Standard Board's AccountingStandards Update ("ASU") 2014-15, "Disclosures of Uncertainties about an Entity's Ability to Continue as a Going Concern", management has determinedthat the mandatory liquidation and subsequent dissolution raises substantial doubt about the Company's ability to continue as a going concern. Management plans to address this uncertainty through theconsummation of a Business Combination. No adjustments have been made to the carrying amounts of assets or liabilities should the Company be required to liquidate after May 18, 2020.

NOTE 2—SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

        The accompanying financial statements are presented in U.S. dollars in conformity with accounting principles generally accepted in the UnitedStates of America ("U.S. GAAP") and pursuant to the rules and regulations of the SEC.

Emerging Growth Company

        Section 102(b)(1) of the Jumpstart Our Business Startups Act of 2012 (the "JOBS Act") exempts emerging growth companies from beingrequired to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do nothave a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that an emerging growth company canelect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is

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Notes to Condensed Financial Statements (Continued)

(Unaudited)

NOTE 2—SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

irrevocable.The Company has elected not to opt out of such extended transition period, which means that when a standard is issued or revised, and it has different application dates for public orprivate companies, the Company, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard.

        Thismay make comparison of the Company's financial statement with another public company that is neither an emerging growth company nor an emerging growth company that has opted out ofusing the extended transition period difficult or impossible because of the potential differences in accounting standards used.

Net (Loss) Income Per Common Share

        Net (loss) income per common share is computed by dividing net (loss) income applicable to common stockholders by the weighted average number ofshares of common stock outstanding during the period, plus to the extent dilutive the incremental number of shares of common stock to settle warrants, as calculated using the treasury stock method. Asof March 31, 2020 and December 31, 2019, the Company had outstanding warrants to purchase 23,890,000 shares of common stock. These shares were excluded from the calculation of dilutednet (loss) income per share of common stock because their inclusion would have been anti-dilutive. As a result, diluted net (loss) income per common share is the same as basic net (loss) income percommon share for the periods presented.

Concentration of Credit Risk

        Financial instruments that potentially subject the Company to concentrations of credit risk consist of cash accounts and a trust account held atfinancial institutions, which, at times, may exceed the Federal Depository Insurance Coverage of $250,000. As of March 31, 2020 and December 31, 2019, the Company has not experiencedlosses on these accounts and management believes the Company is not exposed to significant risks on such accounts.

Financial Instruments

        The fair value of the Company's assets and liabilities, which qualify as financial instruments under the FASB ASC 820, "Fair Value Measurementsand Disclosures," approximates the carrying amounts represented in the balance sheet due to their short-term nature.

Use of Estimates

        The preparation of financial statements in conformity with U.S. GAAP requires the Company's management to make estimates and assumptionsthat affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of expenses during thereporting period. Actual results could differ from those estimates.

Cash and cash equivalents

        The Company considers all short-term investments with an original maturity of three months or less when purchased to be cash equivalents.

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Notes to Condensed Financial Statements (Continued)

(Unaudited)

NOTE 2—SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Cash and cash equivalents held in Trust Account

        The Company considers all short-term investments with an original maturity of three months or less when purchased to be that are held in theTrust Account to be cash equivalents. As of March 31, 2020, the cash equivalents held in the Trust Account were held in 30-day U.S. Treasury bills. As of December 31, 2019, the cashequivalents held in the Trust Account were held in money market funds.

Investments held in Trust Account

        As of March 31, 2020 ,the Company had no investments held in the Trust Account. As of December 31, 2019, the assets held in theTrust Account were held in 90-day U.S. Treasury bills.

Common stock subject to possible redemption

        The Company accounts for its common stock subject to possible redemption in accordance with the guidance in ASC Topic 480 "DistinguishingLiabilities from Equity." Common stock subject to mandatory redemption (if any) is classified as a liability instrument and is measured at fair value. Conditionally redeemable common stock (includingcommon stock that features redemption rights that are either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within the Company's control)is classified as temporary equity. At all other times, common stock is classified as stockholders' equity. The Company's common stock features certain redemption rights that are considered to beoutside of the Company's control and subject to occurrence of uncertain future events. Accordingly, common stock subject to possible redemption is presented as temporary equity, outside of thestockholders' equity section of the Company's condensed balance sheet.

Offering costs

        Offering costs consist of underwriting, legal, accounting, and other expenses incurred through the balance sheet date that are directly relatedto the initial public offering.

Income Taxes

        The Company follows the asset and liability method of accounting for income taxes under FASB ASC 740, "Income Taxes." Deferred tax assets andliabilities are recognized for the estimated future tax consequences attributable to differences between the financial statements carrying amounts of existing assets and liabilities and theirrespective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to berecovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that included the enactment date. Valuation allowances areestablished, when necessary, to reduce deferred tax assets to the amount expected to be realized.

        FASBASC 740 prescribes a recognition threshold and a measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken in atax return. For those benefits to be recognized, a tax position must be more likely than not to be sustained upon examination by taxing authorities. There were no unrecognized tax benefits as ofMarch 31, 2020 or

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Notes to Condensed Financial Statements (Continued)

(Unaudited)

NOTE 2—SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

December 31,2019. The Company recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense. No amounts were accrued for the payment of interest andpenalties as of March 31, 2020 or December 31, 2019. The Company is currently not aware of any issues under review that could result in significant payments, accruals or materialdeviation from its position. The Company is subject to income tax examinations by major taxing authorities since inception.

        TheCompany may be subject to potential examination by federal, state and city taxing authorities in the areas of income taxes. These potential examinations may include questioning thetiming andamount of deductions, the nexus of income among various tax jurisdictions and compliance with federal, state and city tax laws. The Company has recorded deferred tax liabilities relating to expensesdeferred for income tax purposes as of March 31, 2020 and December 31, 2019 amounting to $0 and $101,521, respectively.

Recent Accounting Pronouncements

        The Company's management does not believe that there are any recently issued, but not yet effective, accounting pronouncements, if currentlyadopted, would have a material effect on the Company's financial statements.

Coronavirus (COVID-19) Pandemic.

        On March 11, 2020 the World Health Organization declared the novel strain of coronavirus ("COVID-19") a global pandemic and recommendedcontainment and mitigation measures worldwide. As the Company is located in New York, the Company is currently under a shelter-in-place mandate and many of our business partners are similarlyimpacted. The global outbreak of COVID-19 continues to rapidly evolve, and the extent to which COVID-19 may impact the Company's business will depend on future developments, which are highly uncertainand cannot be predicted with confidence, such as the ultimate geographic spread of the disease, the duration of the outbreak, travel restrictions and social distancing in the United States and othercountries, business closures or business disruptions, and the effectiveness of actions taken in the United States and other countries to contain and treat the disease. The Company continues tovigilantly monitor the situation with its primary focus on the health and safety of its business partners.

NOTE 3—PROPOSED BUSINESS COMBINATION

Business Combination Agreement

        Pursuant to the Business Combination Agreement, at the closing of the Proposed Transaction (the "Closing"), Merger Sub will be merged with andinto Nikola (the "Merger"), with Nikola surviving the Merger as a wholly-owned direct subsidiary of the Company. Immediately prior to the effective time of the Merger (the "Effective Time"), Nikolawill cause the shares of Nikola's preferred stock issued and outstanding immediately prior to the Effective Time to be automatically converted into shares of Nikola common stock, and each convertedshare of Nikola preferred stock will no longer be outstanding and will cease to exist. At the Effective Time, by virtue of the Merger, all shares of Nikola common stock issued and outstandingimmediately prior to the Effective Time will be canceled and converted into the right to receive the number of shares of the Company's common stock equal to the exchange ratio of 1.901 set forth inthe Business Combination Agreement (the "Exchange Ratio").

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NOTE 3—PROPOSED BUSINESS COMBINATION (Continued)

EachNikola stock option that is outstanding immediately prior to the Effective Time, whether vested or unvested, will be converted into an option to purchase a number of shares of the Company'scommon stock equal to the product (rounded down to the nearest whole number) of (i) the number of shares of Nikola common stock subject to such option immediately prior to the Effective Timeand (ii) the Exchange Ratio, at an exercise price per share (rounded up to the nearest whole cent) equal to(A) the exercise price per share of such option immediately prior to the Effective Time divided by (B) the Exchange Ratio.

        TheClosing is subject to certain conditions, including but not limited to the approval of the Company's stockholders and Nikola's stockholders of the Business Combination Agreement. TheBusiness Combination Agreement may also be terminated by either party under certain circumstances. Nikola has agreed to customary "no shop" obligations subject to a customary "fiduciary out," andNikola would be required to pay a termination fee in the amount of $82 million if the Business Combination Agreement is terminated under certain circumstances.

        TheClosing will occur as promptly as practicable, but in no event later than three business days following the satisfaction or waiver of all of the closing conditions contained in theBusiness Combination Agreement. Because the Company and Nikola have determined that the Closing will not occur on or before May 18, 2020, the Company has called a special meeting of itsstockholders to request approval to extend the date by which the Company must complete an Initial Business Combination from May 18, 2020 to July 31, 2020, as described below.

Stockholder Support Agreement

        Also on March 2, 2020, certain stockholders of Nikola holding the votes necessary to approve the Proposed Transaction entered into aStockholder Support Agreement with the Company (the "Stockholder Support Agreement"), pursuant to which such stockholders agreed to vote all of their shares of Nikola capital stock in favor of theapproval and adoption of the Proposed Transaction. Additionally, such stockholders agreed not to (i) transfer any of their shares of Nikola capital stock (or enter into any arrangement withrespect thereto) or (ii) enter into any voting arrangement that is inconsistent with the Stockholder Support Agreement.

Registration Rights and Lock-Up Agreement

        Pursuant to the Business Combination Agreement and as a condition to the Closing, the Company, certain persons and entities holding the FounderShares and Private Placement Units (the "Original Holders") and certain stockholders of Nikola (the "New Holders" and, collectively with the Original Holders, the "Holders") will enter into aRegistration Rights and Lock-Up Agreement at the Closing (the "Registration Rights and Lock-Up Agreement"). Pursuant to the terms of the Registration Rights and Lock-Up Agreement, the Company will beobligated to file a registration statement to register the resale of certain securities of the Company held by the Holders. In addition,pursuant to the terms of the Registration Rights and Lock-Up Agreement and subject to certain requirements and customary conditions, including with regard to the number of demand rights that may beexercised, the Holders may demand at any time or from time to time, that the Company file a registration statement on Form S-3 (or on Form S-1 if Form S-3 is not available)to register the Company's securities held by

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suchHolders. The Registration Rights and Lock-Up Agreement will also provide the Holders with "piggy-back" registration rights, subject to certain requirements and customary conditions.

        TheRegistration Rights and Lock-Up Agreement further provides for the securities of the Company held by the Holders to be locked-up for a period of time following the Closing, asdescribed below, subject to certain exceptions. The securities held by the Original Holders will be locked-up for one year following the Closing, subject to earlier release if (i) the reportedlast sale price of the Company's common stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 tradingdays within any 30-trading day period commencing at least 150 days after the Closing or (ii) if the Company consummates a liquidation, merger, stock exchange or other similar transactionafter the Closing which results in all of the Company's stockholders having the right to exchange their shares of common stock for cash, securities or other property. The securities held by the NewHolders, other than certain entities controlled by Trevor Milton, the current Chief Executive Officer of Nikola, will be locked-up for 180 days after the Closing. The securities held by certainentities controlled by Trevor Milton will be locked up for one year following the Closing, except that they would be permitted to sell or otherwise transfer an aggregate of $70.0 million sharesof the Company's common stock commencing 180 days after the Closing.

Subscription Agreements

        In connection with the execution of the Business Combination Agreement, effective as of March 2, 2020, the Company entered into separatesubscription agreements (each, a "Subscription Agreement") with a number of investors (each a "Subscriber"), pursuant to which the Subscribers agreed to purchase, and the Company agreed to sell to theSubscribers, an aggregate of 52,500,000 shares of the Company's common stock (the "PIPE Shares"), for a purchase price of $10.00 per share and an aggregate purchase price of $525 million, in aprivate placement (the "PIPE").

        Theclosing of the sale of the PIPE Shares pursuant to the Subscription Agreements is contingent upon, among other customary closing conditions, the substantially concurrent consummationof the Proposed Transaction. The purpose of the PIPE is to raise additional capital for use by the combined company following the Closing.

        Pursuantto the Subscription Agreements, the Company granted certain registration rights to the Subscribers, including the Company's agreement that, within 45 calendar days after theClosing (the "Filing Deadline"), the Company will file with the SEC a registration statement registering the resale of the PIPE Shares (the "Resale Registration Statement"), and will use itscommercially reasonable efforts to have the Resale Registration Statement declared effective as soon as practicable after the filing thereof. Under certain circumstances described in the SubscriptionAgreements, including if the Resale Registration Statement has not been filed with the SEC by the Filing Deadline, additional payments by the Company may be assessed with respect to the PIPE SharesThe additional payments by the Company would accrue on the applicable registrable securities at a rate of 0.5% of the aggregate purchase price paid for such registrable securities per month, subjectto certain terms and limitations (including a cap of 5.0% of the aggregate purchase price).

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NOTE 3—PROPOSED BUSINESS COMBINATION (Continued)

Registration Statement

        On March 13, 2020, the Company filed a registration statement on Form S-4 with respect to the Proposed Transaction. TheForm S-4 was declared effective on May 8, 2020. The Company has set May 8, 2020 as the record date for the special meeting in lieu of an annual meeting of the Company'sstockholders to approve the Proposed Transaction and related matters, and has set June 2, 2020 as the date for such meeting.

        TheCompany has called a special meeting of its stockholders, scheduled to be held on May 12, 2020, to request approval to amend the Company's amended and restated certificate ofincorporation to extend the date by which the Company must complete an Initial Business Combination from May 18, 2020 to July 31, 2020, in order to allow the Company more time tocomplete the Proposed Transaction.

NOTE 4—INITIAL PUBLIC OFFERING

        Pursuant to the initial public offering, the Company sold 23,000,000 Units (including 3,000,000 Units subject to the underwriters' over-allotment option) at a price of $10.00 per Unit.Each Unit consists of one share of common stock (such shares of common stock included in the Units sold in the initial public offering, the "Public Shares"), and one redeemable warrant (each suchwarrant included in the Units sold in the initial public offering, a "Public Warrant"). Each Public Warrant entitles the registered holder to purchase one share of our common stock at a price of$11.50 per share, subject to adjustment, at any time commencing on the later of 12 months from the closing of the initial public offering or 30 days after the completion of the InitialBusiness Combination. The Public Warrants will expire on the fifth anniversary of the Company's completion of an Initial Business Combination, or earlier upon redemption or liquidation. As ofMarch 31, 2020 and December 31, 2019, the Company had 23,890,000 warrants outstanding.

        TheCompany is accounting for its warrants and the forward purchase agreement (as defined below) under ASC 815 and is including them in Shareholders' Equity.

        NoPublic Warrants will be exercisable for cash unless the Company has an effective and current registration statement covering the shares of Common Stock issuable upon exercise of thePublic Warrants and a current prospectus relating to such shares. Notwithstanding the foregoing, if a registration statement covering the issuance of the shares issuable upon exercise of the PublicWarrants is not effective within 90 days from the closing of the Initial Business Combination, warrant holders may, until such time as there is an effective registration statement and duringany period when the Company shall have failed to maintain an effective registration statement or a current prospectus, exercise Public Warrants on a cashless basis pursuant to an available exemptionfrom registration under the Securities Act. If an exemption from registration is not available, holders will not be able to exercise their Public Warrants on a cashless basis.

        ThePrivate Warrants (as defined below) are identical to the Public Warrants underlying the Units sold in the initial public offering, except that the Private Warrants and the commonstock issuable upon exercise of the Private Warrants will not be transferable, assignable or salable until 30 days after the completion of a Business Combination, subject to certain limitedexceptions. Additionally, the Private Warrants will be non-redeemable so long as they are held by the initial purchasers or such purchasers'

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permittedtransferees and Private Warrants held by Cowen Investments LLC will not be exercisable more than five years after the effective date of the registration statement related to theinitial public offering in accordance with FINRA Rule 5110(f)(2)(G)(i). If the Private Warrants are held by someone other than the initial shareholders or their permitted transferees, thePrivate Warrants will be redeemable by the Company and exercisable by such holders on the same basis as the Public Warrants.

        TheCompany may call the Public Warrants for redemption:

•

in whole and not in part;



•

at a price of $0.01 per warrant;



•

upon a minimum of 30 days' prior written notice of redemption; and



•

if, and only if, the last reported closing price of the ordinary shares equals or exceeds $18.00 per share for any 20 trading days within a30-trading day period ending on the third trading day prior to the date on which VectoIQ sends the notice of redemption to the warrant holders.

        Ifthe Company calls the Public Warrants for redemption, management will have the option to require all holders that wish to exercise the Public Warrants to do so on a "cashless basis,"as described in the warrant agreement.

        Theexercise price and number of common stock issuable upon exercise of the warrants may be adjusted in certain circumstances including in the event of a share dividend, orrecapitalization, reorganization, merger or consolidation. However, the warrants will not be adjusted for issuance of common stock at a price below its exercise price. Additionally, in no event willthe Company be required to net cash settle the warrant shares. If the Company is unable to complete a Business Combination within the Combination Period and the Company liquidates the funds held inthe Trust Account, holders of warrants will not receive any of such funds with respect to their warrants, nor will they receive any distribution from the Company's assets held outside of the TrustAccount with respect to such warrants. Accordingly, the warrants may expire worthless.

NOTE 5—RELATED PARTY TRANSACTIONS

Founder Shares

        On February 15, 2018, the Founders purchased an aggregate of 5,750,000 shares (the "Founder Shares") of the Company's common stock, parvalue $0.0001, for an aggregate purchase price of $25,000, or approximately $0.004 per share. The Sponsor and Cowen Investments purchased 4,301,000 and 1,449,000 of the Founder Shares, respectively.In March 2018, the Sponsor transferred 15,000 Founder Shares to each of its initial director nominees. In April 2018, the sponsor forfeited 435,606 Founder Shares and the Anchor Investor purchased435,606 Founder Shares for an aggregate purchase price of $1,894, or approximately $0.004 per share. In May 2018, Cowen Investments forfeited 287,500 Founder Shares, which were subsequently purchasedby the Sponsor and the Anchor Investor. Additionally, in May 2018, the Sponsor purchased 254,829 Founder Shares for an aggregate purchase price of $1,108, or approximately $0.004 per share, and theAnchor Investor purchased 32,671 Founder Shares for an aggregate purchase price of $142, or approximately $0.004 per share.

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NOTE 5—RELATED PARTY TRANSACTIONS (Continued)

        Theinitial stockholders have agreed, subject to limited exceptions, not to transfer, assign or sell any of its Founder Shares until the earlier to occur of: (A) one year afterthe completion of the Initial Business Combination and (B) subsequent to the Initial Business Combination, (x) if the last sale price of the common stock equals or exceeds $12.00 pershare (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day periodcommencing at least 150 days after the Initial Business Combination, or (y) the date on which the Company completes a liquidation, merger, capital stock exchange or other similartransaction that results in all of the Company's stockholders having the right to exchange their shares of common stock for cash, securities or other property.

Private Placement Units

        Simultaneously with the initial public offering, the Founders and Anchor Investor purchased an aggregate of 890,000 Private Placement Units(including 90,000 Private Placement Units in connection with the exercise of the over-allotment option) at a price of $10.00 per Private Placement Unit ($8,900,000 in the aggregate) in a privateplacement. Each Private Placement Unit consists of one share of common stock (such shares of common stock included in the Private Placement Units, the "Private Shares") and one redeemable warrant(each, a "Private Warrant"). Each Private Warrant entitles the holder to purchase one share of common stock at a price of $11.50 per share, subject to adjustment (see Note 6). Proceeds from thePrivate Placement Units were added to the proceeds from the initial public offering held in the Trust Account. If the Company does not complete a Business Combination within the Combination Period,the proceeds from the sale of the Private Placement Units held in trust will be part of the liquidating distribution to the public stockholders, and the Private Warrants will expire worthless. ThePrivate Warrants will be non-redeemable and exercisable on a cashless basis so long as they are held by the Founders or their permitted transferees.

        TheFounders and the Company's officers and directors have agreed, subject to limited exceptions, not to transfer, assign or sell any of their Private Placement Units or the securitiesunderlying the Private Placement Units until the earlier to occur of: (A) one year after the completion of the Initial Business Combination and (B) subsequent to the Initial BusinessCombination, (x) if the last sale price of the common stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like)for any 20 trading days within any 30-trading day period commencing at least 150 days after the Initial Business Combination, or (y) the date on which the Company completes aliquidation, merger, capital stock exchange or other similar transaction that results in all of the Company's stockholders having the right to exchange their shares of common stock for cash,securities or other property.

        Afund affiliated with P. Schoenfeld Asset Management LP, which is referred to as the "forward purchase investor," is a member of the Sponsor and has entered into a contingentforward purchase agreement with the Company (the "forward purchase agreement") which provides for the purchase by the forward purchase investor of 2,500,000 forward purchase shares, plus one of theCompany's redeemable warrants for each forward purchase share, for total gross proceeds of up to $25,000,000. These shares and warrants will be purchased in a private placement to close simultaneouslywith the consummation of the Company's Initial Business Combination. These issuances will be made pursuant to the exemption from registration contained in Section 4(a)(2) of the Securities Act.

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NOTE 5—RELATED PARTY TRANSACTIONS (Continued)

        Whilethe Company may elect to have the forward purchase investor purchase no securities under the contingent forward purchase agreement, if the Company requests that the forwardpurchase investor purchase securities and the forward purchase investor defaults on such purchase or the forward purchase investor exercises its right of refusal contained in the forward purchaseagreement, the forward purchase investor will forfeit up to all of its ownership interest in the Sponsor related to Founder Shares, and the Sponsor will have the right to redeem the forward purchaseinvestor's remaining ownership interest in the Sponsor at the original purchase price.

Related Party Loans

        On March 12, 2020, Cowen Investments II, LLC agreed to loan the Company an aggregate of up to $422,000 to cover expenses relatedto the Proposed Business Combination pursuant to a promissory note (the "Promissory Note"). The Promissory Note is non-interest bearing and is due in full on the earlier of September 12, 2020or the date the Company completes or terminates the Business Combination Agreement. As of March 31, 2020, the Company had an outstanding balance of $422,000 under the Promissory Note. As ofDecember 31, 2019, there was no related party loan outstanding.

        Inaddition, in order to finance transaction costs in connection with a Business Combination, the Sponsor or an affiliate of the Sponsor, or certain of the Company's officers anddirectors may, but are not obligated to, loan the Company funds as may be required ("Working Capital Loans"). If the Company completes a Business Combination, the Company would repay the WorkingCapital Loans out of the proceeds of the Trust Account released to the Company. Otherwise, the Working Capital Loans would be repaid only out of funds held outside the Trust Account. In the event thata Business Combination does not close, the Company may use a portion of proceeds held outside the Trust Account to repay the Working Capital Loans, but no proceeds held in the Trust Account would beused to repay the Working Capital Loans. The Working Capital Loans would either be repaid upon consummation of a Business Combination, without interest, or, at the lender's discretion, up to$1,500,000 of such Working Capital Loans may be convertible into additional units of the post Business Combination entity at a price of $10.00 per unit. The securities would be identical to thePrivate Placement Units. To date, the Company had no borrowings under the Working Capital Loans. Except for the foregoing, the terms of such Working Capital Loans, if any, have not been determined andno written agreements exist with respect to such loans.

Administrative Support Agreement

        The Company entered into an agreement, commencing on the effective date of the initial public offering through the earlier of the Company'sconsummation of a Business Combination and its liquidation, to pay the Sponsor a total of $10,000 per month for office space and general administrative services. The Company accrued $30,000 and$195,000 for office space and general administrative services as of March 31, 2020 and December 31, 2019, respectively. During the three months ended March 31, 2020, the Companypaid $195,000 for office space and general administrative services included in general and administrative expenses in the condensed statement of operations.

        TheSponsor, executive officers and directors, or any of their respective affiliates, will be reimbursed for any out-of-pocket expenses incurred in connection with activities on theCompany's behalf such as identifying potential target businesses and performing due diligence on suitable Business Combinations. The Company's audit committee will review on a quarterly basis allpayments that were made to the Sponsor, officers, directors or their affiliates and will determine which expenses and the amount of expenses that will be reimbursed. There is no cap or ceiling on thereimbursement of out-of-pocket expenses incurred by such persons in connection with activities on the Company's behalf.

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NOTE 6—COMMITMENTS & CONTINGENCIES

Registration Rights

        Pursuant to a registration rights agreement entered into on May 15, 2018, the Founders, anchor investor, and the Company's executiveofficers, directors and director nominees and their permitted transferees will be entitled to demand that the Company register for resale the Founder Shares, the Private Placement Units and underlyingsecurities and any securities issued upon conversion of Working Capital Loans. The holders of these securities will be entitled to make up to three demands, excluding short form demands, that theCompany register such securities. In addition, the holders will have certain "piggy-back" registration rights with respect to registration statements filed subsequent to the Company's consummation ofthe Initial Business Combination. The Company will bear the expenses incurred in connection with the filing of any such registration statements. Notwithstanding the foregoing, Cowen Investments maynot exercise its demand and "piggyback" registration rights after five and seven years, respectively, after the effective date of the initial public offering and may not exercise its demand rights onmore than one occasion.

Business Combination Marketing Agreement

        The Company engaged the underwriters as advisors in connection with its Business Combination pursuant to a business combination marketingagreement. Pursuant to that agreement, the Company will pay such advisors a cash fee for such services upon the consummation of an Initial Business Combination in an amount equal to 3.5% of the grossproceeds of the initial public offering, including any proceeds from the full or partial exercise of the over-allotment option.

NOTE 7—STOCKHOLDERS' EQUITY

        Common Stock—The Company is currently authorized to issue 100,000,000 shares of common stock with a par value of $0.0001 per share. Holders ofcommonstock are entitled to one vote for each share. As of March 31, 2020 and December 31, 2019, there were 29,640,000 shares of common stock issued and outstanding including 22,509,588 and22,552,141 shares subject to redemption, respectively.

        Preferred Stock—The Company is authorized to issue 1,000,000 shares of preferred stock with such designations, voting and other rights andpreferencesas may be determined from time to time by the Company's board of directors. As of March 31, 2020 and December 31, 2019, there were no shares of preferred stock issued or outstanding.

NOTE 8—INVESTMENT VALUATION

        FASB ASC 820 establishes a single definition of fair value, creates a three-tier hierarchy as a framework for measuring fair value based on inputs used to value the Company's investmentsand requires additional disclosure about fair value. Fair value is an estimate of the price the Company would receive to sell an asset or pay to transfer a liability in an orderly arm's lengthtransaction between market participants at the measurement date and sets out a fair value hierarchy. The valuation hierarchy is based upon the transparency of inputs used to measure fair value. Inaccordance with

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(Unaudited)

NOTE 8—INVESTMENT VALUATION (Continued)

U.S. GAAP,investments measured and reported at fair value are classified and disclosed in one of the following categories:

Level 1: Quoted prices (unadjusted) are available in active markets for identical investments as of the reporting date. The types of financialinstruments in Level 1 include listed equities and listed derivatives. The Company's investments in the Trust Account are 30-day U.S. government treasury bills and therefore are level 1investments, since the Company is able to value the investments based on quoted prices in an active market.

Level 2: Pricing inputs are other than quoted prices in active markets for identical investments, which are either directly or indirectlyobservable as of the reporting date, and fair value is determined through the use of models or other valuation methodologies. Financial instruments in this category generally include corporate bondsand loans, less liquid and restricted equity securities, certain over-the-counter derivatives. A significant adjustment to a Level 2 input could result in the Level 2 measurementbecoming a Level 3 measurement.

Level 3: Pricing inputs include those that are generally less observable or unobservable and include situations where there is little, if any,market activity for the investment. Financial instruments in this category generally include equity and debt positions in private companies. Fair value for these investments is determined usingvaluation methodologies that consider a range of factors, including but not limited to the price at which the investment was acquired, the nature of the investment, local markets conditions, currentand projected operating performance, and financing transactions subsequent to the acquisition of the investment. The inputs into the determination of fair value require significant managementjudgment. Due to the inherent uncertainty of these estimates, these values may differ materially from the values that would have been used had a ready market for these investments existed.

        Incertain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, an investment's level within the fair value hierarchyis based on the lowest level of input that is significant to the fair value measurement. The Company's assessment of the significance of a particular input to the fair value measurement in itsentirety requires judgment, and considers factors specific to the investment.

        Uponthe closing of the initial public offering and the private placement, a total of $202,000,000 was deposited into the Trust Account at May 18, 2018. In connection with theexercise of the overallotment option, an additional $30,300,000 was deposited. All proceeds in the Trust Account may be invested in either U.S. government treasury bills with a maturity of180 days or less or in money market funds meeting certain conditions under Rule 2a-7 under the Investment Company Act of 1940, as amended, and that invest solely in U.S. governmenttreasury obligations.

        Theproceeds of the Trust account were invested in in 30-day U.S. government treasury bills maturing in April 2020 as of March 31, 2020, yielding interest of approximately(.025%). The Company considers all short-term investments with an original maturity of three months or less when purchased to be that are held in the Trust Account to be cash equivalents.

        Asof December 31, 2019, the proceeds of the Trust Account were invested in U.S. government treasury bills maturing in February 2020, yielding interest of approximately 1.5%. TheCompany

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NOTE 8—INVESTMENT VALUATION (Continued)

classifiesits U.S. government treasury bills and equivalent securities as held-to-maturity in accordance with FASB ASC 320, "Investments—Debt and Equity Securities." Held-to-maturitysecurities are those securities which the Company has the ability and intent to hold until maturity. Held-to-maturity U.S. government treasury bills are recorded at amortized cost on the accompanyingDecember 31, 2019 condensed balance sheets and adjusted for the amortization or accretion of premiums or discounts.

        Thefollowing tables present information about the Company's assets that are measured on a recurring basis as of March 31, 2020 and December 31, 2019 and indicate the fairvalue hierarchy of the valuation techniques the Company utilized to determine such fair value. Since all of the Company's permitted investments at March 31, 2020 and December 31, 2019consist of U.S. government treasury bills, fair values of its investments are determined by Level 1 inputs utilizing quoted prices (unadjusted) in active markets for identical assets orliabilities as follows:

 

        Transfersto/from Levels 1, 2, and 3 are recognized at the end of the reporting period. There were no transfers between levels for the three months ended March 31, 2020 or2019.

NOTE 9—INCOME TAXES

        The Company's financial statements include total net income before taxes of $60,516 and $1,095,793 for the three months ended March 31, 2020 and 2019. The Company made no taxpayments

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NOTE 9—INCOME TAXES (Continued)

duringthe three months ended March 31, 2020 and 2019. The income tax provision consists of the following:

        Thetable below presents the Company's deferred income taxes as of:

        TheCompany files income tax returns in the U.S. federal jurisdiction and in New York and is subject to examination by the taxing authorities. The Company considered New York to be asignificant state tax jurisdiction. Its income tax returns are open for audit for tax years 2018 and forward.

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Report of Independent Registered Public Accounting Firm

Tothe Stockholders and the Board of Directors of VectoIQ Acquisition Corp.

Opinion on the Financial Statements

        We have audited the accompanying balance sheets of VectoIQ Acquisition Corp. (the Company) as of December 31, 2019 and 2018, the relatedstatements of operations, stockholders' equity and cash flows for the year ended December 31, 2019 and for the period from January 23, 2018 (inception) to December 31, 2018, andthe related notes to the financial statements (collectively, the financial statements). In our opinion, the financial statements present fairly, in all material respects, the financial position of theCompany as of December 31, 2019 and 2018, and the results of its operations and its cash flows for the year ended December 31, 2019 and for the period from January 23, 2018(inception) to December 31, 2018, in conformity with accounting principles generally accepted in the United States of America.

Going Concern

        The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed inNote 1 to the financial statements, the Company will undergo mandatory liquidation on May 18, 2020 if a business combination is not consummated and subsequent dissolution. This raisessubstantial doubt about the Company's ability to continue as a going concern. Management's plans in regard to these matters also are described in Note 1. The financial statements do not includeany adjustments that might result from the outcome of this uncertainty.

Basis for Opinion

        These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company'sfinancial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent withrespect to the Company in accordance with U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

        Weconducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether thefinancialstatements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financialreporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of theCompany's internal control over financial reporting. Accordingly, we express no such opinion.

        Ouraudits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respondto those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accountingprinciples used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for ouropinion.

/s/RSM US LLP

Wehave served as the Company's auditor since 2018.

NewYork, New York
March 6, 2020

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VectoIQ Acquisition Corp.

BALANCE SHEETS

   

See accompanying notes to financial statements.

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VectoIQ Acquisition Corp.

STATEMENTS OF OPERATIONS

   

See accompanying notes to financial statements.

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VectoIQ Acquisition Corp.

STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY

For the period from January 23, 2018 (Inception) to December 31, 2019

   

See accompanying notes to financial statements.

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VectoIQ Acquisition Corp.

STATEMENTS OF CASH FLOWS

   

See accompanying notes to financial statements.

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NOTES TO FINANCIAL STATEMENTS

DECEMBER 31, 2018

NOTE 1—DESCRIPTION OF ORGANIZATION AND BUSINESS OPERATIONS

        VectoIQ Acquisition Corp. (the "Company") was incorporated in Delaware on January 23, 2018. The Company was formed for the purpose of effecting a merger, share exchange, assetacquisition, stock purchase, recapitalization reorganization or similar business combination with one or more businesses (the "Business Combination"). Although the Company is not limited to aparticular industry or sector for purposes of consummating a Business Combination, the Company intends to focus its search on the industrial technology, transportation and smart mobility industries.The Company is an emerging growth company and, as such, the Company is subject to all of the risks associated with emerging growth companies.

        Asof December 31, 2019, the Company had not commenced operations. All activity for the period from January 23, 2018 (inception) through December 31, 2019 relates tothe Company's formation and its initial public offering described below, and since the closing of its initial public offering, a search for a Business Combination candidate. The Company will notgenerate any operating revenues until after the completion of its initial Business Combination, at the earliest. The Company will generate non-operating income in the form of interest income on cashand cash equivalents and investments from the proceeds derived from its initial public offering. The Company has a December 31 year end.

        TheCompany's sponsor is VectoIQ Holdings, LLC, a Delaware limited liability company (the "Sponsor").

        Theregistration statement for the Company's initial public offering was declared effective May 15, 2018. On May 18, 2018, the Company consummated an initial publicoffering of 20,000,000 units (each, a "Unit" and collectively, the "Units") at $10.00 per Unit, which is discussed in Note 3. Simultaneously with the closing of the initial public offering, theCompany consummated the sale of 800,000 units (each, a "Private Placement Unit" and collectively, the "Private Placement Units") at a price of $10.00 per Private Placement Unit in a private placementto the Sponsor, Cowen Investments, LLC (collectively with the Sponsor, the "Founders") and certain funds and accounts managed by subsidiaries of BlackRock, Inc. (collectively, the"Anchor Investor").

        Followingthe closing of the initial public offering on May 18, 2018, an amount of $202,000,000 ($10.10 per Unit) from the net proceeds of the sale of the Units in the initialpublic offering and the Private Placement Units was placed in a trust account ("Trust Account") which was invested in U.S. government securities, within the meaning set forth inSection 2(a)(16) of the Investment Company Act of 1940, as amended (the "Investment Company Act"), with a maturity of 180 days or less or in any open-ended investment company that holdsitself out as a money market fund selected by the Company meeting the conditions of Rule 2a-7 of the Investment Company Act, as determined by the Company, until the earlier of: (i) theconsummation of a Business Combination or (ii) the distribution of the Trust Account, as described below.

        OnMay 24, 2018, the underwriters notified the Company of their exercise of the over-allotment option in full and, on May 29, 2018, purchased 3,000,000 additional Units(the "Additional Units") at $10.00 per Additional Unit upon the closing of the over-allotment option, generating total gross proceeds of $30,000,000. On May 29, 2018, simultaneously with thesale of the Additional Units, the Company consummated the sale of an additional 90,000 Private Units at $10.00 per additional Private Unit (the "Additional Private Units"), generating total grossproceeds of $900,000. Following the closing of the over-allotment option, an additional $30,300,000 ($10.10 per Unit) was placed in the Trust Account, resulting in $232,300,000 ($10.10 per Unit) heldin the Trust Account.

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NOTES TO FINANCIAL STATEMENTS (Continued)

DECEMBER 31, 2018

NOTE 1—DESCRIPTION OF ORGANIZATION AND BUSINESS OPERATIONS (Continued)

        Transactioncosts amounted to $5,244,622, consisting of $4,600,000 of underwriting fees, including underwriting fees resulting from the exercise of the underwriters' over-allotment, and$644,622 of initial public offering costs.

        TheCompany's management has broad discretion with respect to the specific application of the net proceeds of the initial public offering and the sale of Private Placement Units,although substantially all of the net proceeds are intended to be applied generally toward consummating a Business Combination. There is no assurance that the Company will be able to complete aBusiness Combination successfully. The Company must complete its initial Business Combination with one or more target businesses having an aggregate fair market value of at least 80% of the assetsheld in the Trust Account (excluding taxes payable on income earned on the Trust Account) at the time of the agreement to enter into the initial Business Combination. However, the Company will onlycomplete a Business Combination if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in thetarget business sufficient for it not to be required to register as an investment company under the Investment Company Act.

        TheCompany will provide its holders of the outstanding shares of its common stock, par value $0.0001, sold in the initial public offering (the "public stockholders") with theopportunity to redeem all or a portion of their Public Shares (as defined below in Note 3) upon the completion of a Business Combination either (i) in connection with a stockholdermeeting called to approve the Business Combination or (ii) by means of a tender offer. The decision as to whether the Company will seek stockholder approval of a Business Combination or conducta tender offer will be made by the Company, solely in its discretion. The public stockholders will be entitled to redeem their Public Shares for a pro rata portion of the amount then in the TrustAccount (initially anticipated to be $10.10 per Public Share). These Public Shares are recorded at a redemption value and classified as temporary equity in accordance with the Financial AccountingStandards Board's ("FASB") Accounting Standards Codification ("ASC") Topic 480 "Distinguishing Liabilities from Equity." The Company will proceed with a Business Combination only if the Company hasnet tangible assets of at least $5,000,001 upon such consummation of a Business Combination and, if a stockholder vote is held to approve such transaction, only if a majority of the shares voted arevoted in favor of the Business Combination. If a stockholder vote is not required by law and the Company does not decide to hold a stockholder vote for business or other legal reasons, the Companywill, pursuant to its Amended and Restated Certificate of Incorporation (the "Amended and Restated Certificate of Incorporation"), conduct the redemptions pursuant to the tender offer rules of theU.S. Securities and Exchange Commission ("SEC") and file tender offer documents with the SEC prior to completing a Business Combination. If, however, stockholder approval of the transactions isrequired by law, or the Company decides to obtain stockholder approval for business or legal reasons, the Company will offer to redeem shares in conjunction with a proxy solicitation pursuant to theproxy rules and not pursuant to the tender offer rules. Additionally, each public stockholder may elect to redeem their Public Shares without voting, and if they do vote, irrespective of whether theyvote for or against the proposed transaction. If the Company seeks stockholder approval in connection with a Business Combination, the initialstockholders (as defined below) have agreed to vote their Founder Shares (as defined below in Note 4) and any Public Shares purchased during or after the initial public offering in favor of aBusiness Combination. In addition, the VectoIQ Initial Stockholders (as defined below) have agreed to waive their redemption rights with respect to their Founder Shares and Public Shares in connectionwith the

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NOTES TO FINANCIAL STATEMENTS (Continued)

DECEMBER 31, 2018

NOTE 1—DESCRIPTION OF ORGANIZATION AND BUSINESS OPERATIONS (Continued)

completionof a Business Combination or any amendment to the provisions of the Company's Amended and Restated Certificate of Incorporation relating to its pre-initial business combination activity andrelated stockholders' rights.

        Notwithstandingthe foregoing, the Amended and Restated Certificate of Incorporation provides that a public stockholder, together with any affiliate of such stockholder or any otherperson with whom such stockholder is acting in concert or as a "group" (as defined under Section 13 of the Securities Exchange Act of 1934, as amended (the "Exchange Act")), will be restrictedfrom redeeming its shares with respect to more than an aggregate of 15% of the common stock sold in the initial public offering, without the prior consent of the Company.

        TheCompany's Founders, officers and directors (the "VectoIQ Initial Stockholders") have agreed not to propose an amendment to the Amended and Restated Certificate of Incorporation thatwould affect the substance or timing of the Company's obligation to redeem 100% of its Public Shares if the Company does not complete a Business Combination, unless the Company provides the publicstockholders with the opportunity to redeem their shares of common stock in conjunction with any such amendment.

        Ifthe Company does not consummate a Business Combination by May 18, 2020 (the "Combination Period"), it will (i) cease all operations except for the purpose of winding up,(ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem the Public Shares, at a per-share price, payable in cash, equal to the aggregate amount then ondeposit in the Trust Account including interest (less up to $100,000 of interest to pay dissolution expenses, and taxes that were not previously released from the trust and paid), divided by thenumber of then outstanding Public Shares, which redemption will completely extinguish public stockholders' rights as stockholders (including the right to receive further liquidating distributions, ifany), subject to applicable law, and (iii) as promptly as reasonably possible following such redemption, subject to the approval of the Company's remaining stockholders and the Company's boardof directors, dissolve and liquidate, subject in each case to the Company's obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law.

        TheVectoIQ Initial Stockholders have agreed to waive their liquidation rights with respect to the Founder Shares if the Company fails to complete a Business Combination within theCombinationPeriod. However, if the VectoIQ Initial Stockholders should acquire Public Shares in or after the initial public offering, they will be entitled to liquidating distributions from the Trust Accountwith respect to such Public Shares if the Company fails to complete a Business Combination within the Combination Period. In the event of such distribution, it is possible that the per share value ofthe residual assets remaining available for distribution (including Trust Account assets) will be only $10.10 per share initially held in the Trust Account (or potentially less in certaincircumstances). In order to protect the amounts held in the Trust Account, the Sponsor has agreed to be liable to the Company if and to the extent any claims by a vendor for services rendered orproducts sold to the Company, or a prospective target business with which the Company has discussed entering into a transaction agreement, reduce the amount of funds in the Trust Account. Thisliability will not apply with respect to any claims by a third party who executed a waiver of any right, title, interest or claim of any kind in or to any monies held in the Trust Account or to anyclaims under the Company's indemnity of the underwriters of the initial public offering against certain liabilities, including liabilities under the Securities Act. Moreover, in the event that anexecuted waiver is deemed to be unenforceable against a third party, the Sponsor

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NOTES TO FINANCIAL STATEMENTS (Continued)

DECEMBER 31, 2018

NOTE 1—DESCRIPTION OF ORGANIZATION AND BUSINESS OPERATIONS (Continued)

willnot be responsible to the extent of any liability for such third-party claims. The Company will seek to reduce the possibility that the Sponsor will have to indemnify the Trust Account due toclaims of creditors by endeavoring to have all vendors (other than the Company's independent auditors), service providers, prospective target businesses or other entities with which the Company doesbusiness, execute agreements with the Company waiving any right, title, interest or claim of any kind in or to monies held in the Trust Account.

Going Concern

        In connection with the Company's assessment of going concern considerations in accordance with Financial Accounting Standard Board's AccountingStandards Update ("ASU") 2014-15, "Disclosures of Uncertainties about an Entity's Ability to Continue as a Going Concern", management has determinedthat the mandatory liquidation and subsequent dissolution raises substantial doubt about the Company's ability to continue as a going concern. Management plans to address this uncertainty through theconsummation of a Business Combination. No adjustments have been made to the carrying amounts of assets or liabilities should the Company be required to liquidate after May 18, 2020.

NOTE 2—SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

        The accompanying financial statements are presented in U.S. dollars in conformity with accounting principles generally accepted in the UnitedStates of America ("U.S. GAAP") and pursuant to the rules and regulations of the SEC.

Emerging Growth Company

        Section 102(b)(1) of the Jumpstart Our Business Startups Act of 2012 (the "JOBS Act") exempts emerging growth companies from beingrequired to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do nothave a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that an emerging growth company canelect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable. The Company has electednot to opt out of such extended transition period, which means that when a standard is issued or revised, and it has different application dates for public or private companies, the Company, as anemerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard.

        Thismay make comparison of the Company's financial statement with another public company that is neither an emerging growth company nor an emerging growth company that has opted out ofusing the extended transition period difficult or impossible because of the potential differences in accounting standards used.

Net Income Per Common Share

        Net income per common share is computed by dividing net income applicable to common stockholders by the weighted average number of shares ofcommon stock outstanding during the

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NOTES TO FINANCIAL STATEMENTS (Continued)

DECEMBER 31, 2018

NOTE 2—SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

period,plus to the extent dilutive the incremental number of shares of common stock to settle warrants, as calculated using the treasury stock method. At December 31, 2019 and 2018, theCompany had outstanding warrants to purchase 23,890,000 shares of common stock, respectively. These shares were excluded from the calculation of diluted net income per share of common stock becausetheir inclusion would have been anti-dilutive. As a result, diluted net income per common share is the same as basic net income per common share for the periods presented.

Concentration of Credit Risk

        Financial instruments that potentially subject the Company to concentrations of credit risk consist of cash accounts and a trust account held atfinancial institutions, which, at times, may exceed the Federal Depository Insurance Coverage of $250,000. At December 31, 2019 and 2018, the Company has not experienced losses on theseaccounts and management believes the Company is not exposed to significant risks on such accounts.

Financial Instruments

        The fair value of the Company's assets and liabilities, which qualify as financial instruments under the FASB ASC 820, "Fair Value Measurementsand Disclosures," approximates the carrying amounts represented in the balance sheet due to their short-term nature.

Use of Estimates

        The preparation of financial statements in conformity with U.S. GAAP requires the Company's management to make estimates and assumptionsthat affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of expenses during thereporting period. Actual results could differ from those estimates.

Cash and cash equivalents

        The Company considers all short-term investments with an original maturity of three months or less when purchased to be cash equivalents.

Cash held in Trust Account

        At December 31, 2019 and 2018, the assets held in the Trust Account were held in 90-day U.S. Treasury bills.

Common stock subject to possible redemption

        The Company accounts for its common stock subject to possible redemption in accordance with the guidance in ASC Topic 480 "DistinguishingLiabilities from Equity." Common stock subject to mandatory redemption (if any) is classified as a liability instrument and is measured at fair value. Conditionally redeemable common stock (includingcommon stock that features redemption rights that are either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within the Company's control)is classified as temporary equity. At all other times, common stock is classified as stockholders' equity. The Company's common stock features certain

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NOTES TO FINANCIAL STATEMENTS (Continued)

DECEMBER 31, 2018

NOTE 2—SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

redemptionrights that are considered to be outside of the Company's control and subject to occurrence of uncertain future events. Accordingly, common stock subject to possible redemption is presentedas temporary equity, outside of the stockholders' equity section of the Company's balance sheet.

Offering costs

        Offering costs consist of underwriting, legal, accounting, and other expenses incurred through the balance sheet date that are directly relatedto the initial public offering.

Income Taxes

        The Company follows the asset and liability method of accounting for income taxes under FASB ASC 740, "Income Taxes." Deferred tax assets andliabilities are recognized for the estimated future tax consequences attributable to differences between the financial statements carrying amounts of existing assets and liabilities and theirrespective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years inwhich those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period thatincluded the enactment date. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized.

        FASBASC 740 prescribes a recognition threshold and a measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken in atax return. For those benefits to be recognized, a tax position must be more likely than not to be sustained upon examination by taxing authorities. There were no unrecognized tax benefits as ofDecember 31, 2019 and 2018. The Company recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense. No amounts were accrued for the payment of interestand penalties at December 31, 2019 and 2018. The Company is currently not aware of any issues under review that could result in significant payments, accruals or material deviation from itsposition. The Company is subject to income tax examinations by major taxing authorities since inception.

        TheCompany may be subject to potential examination by federal, state and city taxing authorities in the areas of income taxes. These potential examinations may include questioning thetiming and amount of deductions, the nexus of income among various tax jurisdictions and compliance with federal, state and city tax laws. The Company has recorded deferred tax liabilities relating toexpenses deferred for income tax purposes as of December 31, 2019 and 2018 amounting to $101,521 and $102,777, respectively. On December 22, 2017, the Tax Cuts and Jobs Act of 2017 ("TaxReform") was signed into legislation. As part of the legislation, the U.S. corporate income tax rate was reduced from 35% to 21%, among other changes.

Recent Accounting Pronouncements

        The Company's management does not believe that there are any recently issued, but not yet effective, accounting pronouncements, if currentlyadopted, would have a material effect on the Company's financial statements.

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NOTES TO FINANCIAL STATEMENTS (Continued)

DECEMBER 31, 2018

NOTE 3—INITIAL PUBLIC OFFERING

        Pursuant to the initial public offering, the Company sold 23,000,000 Units (including 3,000,000 Units subject to the underwriters' over-allotment option) at a price of $10.00 per Unit.Each Unit consists of one share of common stock (such shares of common stock included in the Units sold in the initial public offering, the "Public Shares"), and one redeemable warrant (each suchwarrant included in the Units sold in the initial public offering, a "Public Warrant"). Each Public Warrant entitles the registered holder to purchase one share of our common stock at a price of$11.50 per share, subject to adjustment, at any time commencing on the later of 12 months from the closing of the initial public offering or 30 days after the completion of the initialBusiness Combination. The Public Warrants will expire on the fifth anniversary of the Company's completion of an initial Business Combination, or earlier upon redemption or liquidation. As ofDecember 31, 2019 and 2018, the Company had 23,890,000 warrants outstanding, respectively.

        TheCompany is accounting for its warrants and the forward purchase agreement (as defined below) under ASC 815 and is including them in Shareholders' Equity.

        NoPublic Warrants will be exercisable for cash unless the Company has an effective and current registration statement covering the shares of Common Stock issuable upon exercise of thePublic Warrants and a current prospectus relating to such shares. Notwithstanding the foregoing, if a registration statement covering the issuance of the shares issuable upon exercise of the PublicWarrants is not effective within 90 days from the closing of the initial Business Combination, warrant holders may, until such time as there is an effective registration statement and duringany period when the Company shall have failed to maintain an effective registration statement or a current prospectus, exercise Public Warrants on a cashless basis pursuant to an available exemptionfrom registration under the Securities Act. If an exemption from registration is not available, holders will not be able to exercise their Public Warrants on a cashless basis.

        ThePrivate Warrants (as defined below) are identical to the Public Warrants underlying the Units sold in the initial public offering, except that the Private Warrants and the commonstock issuable upon exercise of the Private Warrants will not be transferable, assignable or salable until 30 days after thecompletion of a Business Combination, subject to certain limited exceptions. Additionally, the Private Warrants will be non-redeemable so long as they are held by the initial purchasers or suchpurchasers' permitted transferees and Private Warrants held by Cowen Investments LLC will not be exercisable more than five years after the effective date of the registration statement relatedto the initial public offering in accordance with FINRA Rule 5110(f)(2)(G)(i). If the Private Warrants are held by someone other than the initial shareholders or their permitted transferees,the Private Warrants will be redeemable by the Company and exercisable by such holders on the same basis as the Public Warrants.

        TheCompany may call the Public Warrants for redemption:

•

in whole and not in part;



•

at a price of $0.01 per warrant;



•

upon a minimum of 30 days' prior written notice of redemption; and



•

if, and only if, the last reported closing price of the ordinary shares equals or exceeds $18.00 per share for any 20 trading days within a30-trading day period ending on the third trading day prior to the date on which the Company sends the notice of redemption to the warrant holders.

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NOTES TO FINANCIAL STATEMENTS (Continued)

DECEMBER 31, 2018

NOTE 3—INITIAL PUBLIC OFFERING (Continued)

        If the Company calls the Public Warrants for redemption, management will have the option to require all holders that wish to exercise the Public Warrants to do so on a "cashless basis,"as described in the warrant agreement.

        Theexercise price and number of common stock issuable upon exercise of the warrants may be adjusted in certain circumstances including in the event of a share dividend, orrecapitalization, reorganization, merger or consolidation. However, the warrants will not be adjusted for issuance ofcommon stock at a price below its exercise price. Additionally, in no event will the Company be required to net cash settle the warrant shares. If the Company is unable to complete a BusinessCombination within the Combination Period and the Company liquidates the funds held in the Trust Account, holders of warrants will not receive any of such funds with respect to their warrants, norwill they receive any distribution from the Company's assets held outside of the Trust Account with respect to such warrants. Accordingly, the warrants may expire worthless.

NOTE 4—RELATED PARTY TRANSACTIONS

Founder Shares

        On February 15, 2018, the Founders purchased an aggregate of 5,750,000 shares (the "Founder Shares") of the Company's common stock, parvalue $0.0001, for an aggregate purchase price of $25,000, or approximately $0.004 per share. The Sponsor and Cowen Investments purchased 4,301,000 and 1,449,000 of the Founder Shares, respectively.In March 2018, the Sponsor transferred 15,000 Founder Shares to each of its initial director nominees. In April 2018, the sponsor forfeited 435,606 Founder Shares and the Anchor Investor purchased435,606 Founder Shares for an aggregate purchase price of $1,894, or approximately $0.004 per share. In May 2018, Cowen Investments forfeited 287,500 Founder Shares, which were subsequently purchasedby the Sponsor and the Anchor Investor. Additionally, in May 2018, the Sponsor purchased 254,829 Founder Shares for an aggregate purchase price of $1,108, or approximately $0.004 per share, and theAnchor Investor purchased 32,671 Founder Shares for an aggregate purchase price of $142, or approximately $0.004 per share.

        TheVectoIQ Initial Stockholders have agreed, subject to limited exceptions, not to transfer, assign or sell any of its Founder Shares until the earlier to occur of: (A) one yearafter the completion of the initial Business Combination and (B) subsequent to the initial Business Combination, (x) if the last saleprice of the common stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any30-trading day period commencing at least 150 days after the initial Business Combination, or (y) the date on which the Company completes a liquidation, merger, capital stock exchange orother similar transaction that results in all of the Company's stockholders having the right to exchange their shares of common stock for cash, securities or other property.

Private Placement Units

        Simultaneously with the initial public offering, the Founders and Anchor Investor purchased an aggregate of 890,000 Private Placement Units(including 90,000 Private Placement Units in connection with the exercise of the over-allotment option) at a price of $10.00 per Private Placement Unit ($8,900,000 in the aggregate) in a privateplacement. Each Private Placement Unit consists of one share of common stock (such shares of common stock included in the Private Placement Units, the "Private Shares") and one redeemable warrant(each, a "Private Warrant"). Each Private Warrant entitles the

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NOTES TO FINANCIAL STATEMENTS (Continued)

DECEMBER 31, 2018

NOTE 4—RELATED PARTY TRANSACTIONS (Continued)

holderto purchase one share of common stock at a price of $11.50 per share, subject to adjustment (see Note 6). Proceeds from the Private Placement Units were added to the proceeds from theinitial public offering held in the Trust Account. If the Company does not complete a Business Combination within the Combination Period, the proceeds from the sale of the Private Placement Units heldin trust will be part of the liquidating distribution to the public stockholders, and the Private Warrants will expire worthless. The Private Warrants will be non-redeemable and exercisable on acashless basis so long as they are held by the Founders or their permitted transferees.

        TheFounders and the Company's officers and directors have agreed, subject to limited exceptions, not to transfer, assign or sell any of their Private Placement Units or the securitiesunderlying the Private Placement Units until the earlier to occur of: (A) one year after the completion of the initial Business Combination and (B) subsequent to the initial BusinessCombination, (x) if the last sale price of the common stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like)for any 20 trading days within any 30-trading day period commencing at least 150 days after the initial Business Combination, or (y) the date on which the Company completes aliquidation, merger, capital stock exchange or other similar transaction that results in all of the Company's stockholders having the right to exchange their shares of common stock for cash,securities or other property.

        Afund affiliated with P. Schoenfeld Asset Management LP, which is referred to as the "forward purchase investor," is a member of the Sponsor and has entered into a contingentforward purchase agreement with the Company (the "forward purchase agreement") which provides for the purchase by the forward purchase investor of 2,500,000 forward purchase shares, plus one of theCompany's redeemable warrants for each forward purchase share, for total gross proceeds of up to $25,000,000. These shares and warrants will be purchased in a private placement to close simultaneouslywith the consummation of the Company's initial business combination. These issuances will be made pursuant to the exemption from registration contained in Section 4(a)(2) of the Securities Act.

        Whilethe Company may elect to have the forward purchase investor purchase no securities under the contingent forward purchase agreement, if the Company requests that the forwardpurchase investor purchase securities and the forward purchase investor defaults on such purchase or the forward purchase investor exercises its right of refusal contained in the forward purchaseagreement, the forward purchase investor will forfeit up to all of its ownership interest in the Sponsor related to Founder Shares, and the Sponsor will have the right to redeem the forward purchaseinvestor's remaining ownership interest in the Sponsor at the original purchase price.

Related Party Loans

        On March 1, 2018, the Sponsor agreed to loan the Company an aggregate of up to $100,000 to cover expenses related to the initial publicoffering pursuant to a promissory note. Also, on March 1, 2018, Cowen Investments, LLC agreed to loan the Company an aggregate of up to $100,000 to cover expenses related to the initialpublic offering pursuant to a second promissory note on the same terms as the loan provided by the Sponsor. These loans are non-interest bearing and were repaid with the proceeds from the initialpublic offering. At December 31, 2019 and 2018, there is no related party loan outstanding.

        Inaddition, in order to finance transaction costs in connection with a Business Combination, the Sponsor or an affiliate of the Sponsor, or certain of the Company's officers anddirectors may, but are

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notobligated to, loan the Company funds as may be required ("Working Capital Loans"). If the Company completes a Business Combination, the Company would repay the Working Capital Loans out of theproceeds of the Trust Account released to the Company. Otherwise, the Working Capital Loans would be repaid only out of funds held outside the Trust Account. In the event that a BusinessCombination does not close, the Company may use a portion of proceeds held outside the Trust Account to repay the Working Capital Loans, but no proceeds held in the Trust Account would be used torepay the Working Capital Loans. The Working Capital Loans would either be repaid upon consummation of a Business Combination, without interest, or, at the lender's discretion, up to $1,500,000 ofsuch Working Capital Loans may be convertible into additional units of the post Business Combination entity at a price of $10.00 per unit. The securities would be identical to the Private PlacementUnits. To date, the Company had no borrowings under the Working Capital Loans. Except for the foregoing, the terms of such Working Capital Loans, if any, have not been determined and no writtenagreements exist with respect to such loans.

Administrative Support Agreement

        The Company entered into an agreement, commencing on the effective date of the initial public offering through the earlier of the Company'sconsummation of a Business Combination and its liquidation, to pay the Sponsor a total of $10,000 per month for office space and general administrative services. At December 31, 2019 and 2018,the Company accrued $195,000 and $75,000 for office space and general administrative services, respectively.

        TheSponsor, executive officers and directors, or any of their respective affiliates, will be reimbursed for any out-of-pocket expenses incurred in connection with activities on theCompany's behalf such as identifying potential target businesses and performing due diligence on suitable Business Combinations. The Company's audit committee will review on a quarterly basis allpayments that were made to the Sponsor, officers, directors or their affiliates and will determine which expenses and the amount of expenses that will be reimbursed. There is no cap or ceiling on thereimbursement of out-of-pocket expenses incurred by such persons in connection with activities on the Company's behalf.

NOTE 5—COMMITMENTS & CONTINGENCIES

Registration Rights

        Pursuant to a registration rights agreement entered into on May 15, 2018, the Founders, anchor investor, and the Company's executiveofficers, directors and director nominees and their permitted transferees will be entitled to demand that the Company register for resale the Founder Shares, the Private Placement Units and underlyingsecurities and any securities issued upon conversion of Working Capital Loans. The holders of these securities will be entitled to make up to three demands, excluding short form demands, that theCompany register such securities. In addition, the holders will have certain "piggy-back" registration rights with respect to registration statements filed subsequent to the Company's consummation ofthe initial Business Combination. The Company will bear the expenses incurred in connection with the filing of any such registration statements, but the registration rights agreement does not providefor the payment of any cash penalties by the Company if it fails to satisfy any of its obligations under the registration rights agreement. Notwithstanding the foregoing, Cowen Investments may notexercise its demand and "piggyback" registration rights after five and seven years,

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respectively,after the effective date of the initial public offering and may not exercise its demand rights on more than one occasion.

Business Combination Marketing Agreement

        The Company engaged the underwriters as advisors in connection with its Business Combination pursuant to a business combination marketingagreement. Pursuant to that agreement, the Company will pay such advisors a cash fee for such services upon the consummation of an initial Business Combination in an amount equal to 3.5% of the grossproceeds of the initial public offering, including any proceeds from the full or partial exercise of the over-allotment option.

NOTE 6—STOCKHOLDERS' EQUITY

        Common Stock—The Company is currently authorized to issue 100,000,000 shares of common stock with a par value of $0.0001 per share. Holders ofcommonstock are entitled to one vote for each share. As of December 31, 2019 and 2018, there were 29,640,000 shares of common stock issued and outstanding including 22,552,141 and 22,831,030 sharessubject to redemption, respectively.

        Preferred Stock—The Company is authorized to issue 1,000,000 shares of preferred stock with such designations, voting and other rights andpreferencesas may be determined from time to time by the Company's board of directors. As of December 31, 2019 and 2018, there were no shares of preferred stock issued or outstanding.

NOTE 7—INVESTMENT VALUATION

        FASB ASC 820 establishes a single definition of fair value, creates a three-tier hierarchy as a framework for measuring fair value based on inputs used to value the Company's investmentsand requires additional disclosure about fair value. Fair value is an estimate of the price the Company would receive to sell an asset or pay to transfer a liability in an orderly arm's lengthtransaction between market participants at the measurement date and sets out a fair value hierarchy. The valuation hierarchy is based upon the transparency of inputs used to measure fair value. Inaccordance with U.S. GAAP, investments measured and reported at fair value are classified and disclosed in one of the following categories:

Level 1:Quoted prices (unadjusted) are available in active markets for identical investments as of the reporting date. The types of financial instruments in Level 1 include listedequities and listed derivatives. The Company's investments in the Trust Account are 90-day U.S. government treasury bills and therefore are level 1 investments, since the Company is able tovalue the investments based on quoted prices in an active market.

Level 2:Pricing inputs are other than quoted prices in active markets for identical investments, which are either directly or indirectly observable as of the reporting date, and fair value isdetermined through the use of models or other valuation methodologies. Financial instruments in this category generally include corporate bonds and loans, less liquid and restricted equity securities,certain over-the-counter derivatives. A significant adjustment to a Level 2 input could result in the Level 2 measurement becoming a Level 3 measurement.

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Level 3:Pricing inputs include those that are generally less observable or unobservable and include situations where there is little, if any, market activity for the investment. Financialinstruments in this category generally include equity and debt positions in private companies. Fair value for these investments is determined using valuation methodologies that consider a range offactors, including but not limited to the price at which the investment was acquired, the nature of the investment, local markets conditions, current and projected operating performance, and financingtransactions subsequent to the acquisition of the investment. The inputs into the determination of fair value require significant management judgment. Due to the inherent uncertainty of theseestimates, these values may differ materially from the values that would have been used had a ready market for these investments existed.

        Incertain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, an investment's level within the fair value hierarchyis based on the lowest level of input that is significant to the fair value measurement. The Company's assessment of the significance of a particular input to the fair value measurement in itsentirety requires judgment, and considers factors specific to the investment.

        Uponthe closing of the initial public offering and the private placement, a total of $202,000,000 was deposited into the Trust Account at May 18, 2018. In connection with theexercise of the overallotment option, an additional $30,300,000 was deposited. All proceeds in the Trust Account may be invested in either U.S. government treasury bills with a maturity of180 days or less or in money market funds meeting certain conditions under Rule 2a-7 under the Investment Company Act of 1940, as amended, and that invest solely in U.S. governmenttreasury obligations.

        Theproceeds of the Trust Account were invested in U.S. government treasury bills maturing in February 2020 and February 2019 at December 31, 2019 and 2018, respectively, yieldinginterest of approximately 2.0% The Company classifies its U.S. government treasury bills and equivalent securities as held-to-maturity in accordance with FASB ASC 320, "Investments—Debtand Equity Securities." Held-to-maturity securities are those securities which the Company has the ability and intent to hold until maturity. Held-to-maturity U.S. government treasury bills arerecorded at amortized cost on the accompanying December 31, 2019 and 2018 balance sheets and adjusted for the amortization or accretion of premiums or discounts.

        Thefollowing tables present information about the Company's assets that are measured on a recurring basis as of December 31, 2019 and 2018 and indicate the fair value hierarchyof the valuation techniques the Company utilized to determine such fair value. Since all of the Company's permitted investments at December 31, 2019 and 2018 consist of U.S. government treasurybills, fair values of its investments are determined by Level 1 inputs utilizing quoted prices (unadjusted) in active markets for identical assets or liabilities as follows:

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        Transfersto/from Levels 1, 2, and 3 are recognized at the end of the reporting period. There were no transfers between levels for the years ended December 31, 2019 and2018.

NOTE 8—INCOME TAXES

        The Company's financial statements include total net income before taxes of $4,122,829 and $2,588,681 for the years ended December 31, 2019 and 2018. The income tax provisionconsists of the following:

        Reconciliationsof the differences between the provision for income taxes and income taxes at the statutory U.S. federal income tax rate is as follows:

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NOTE 8—INCOME TAXES (Continued)

        Thecomponents of deferred tax liabilities as of December 31, 2019 and 2018 are as follows:

        TheCompany files income tax returns in the U.S. federal jurisdiction and in New York and is subject to examination by the taxing authorities. The Company considered New York to be asignificant state tax jurisdiction. Our income tax returns are open for audit for tax years 2018 and forward.

NOTE 9—SUBSEQUENT EVENTS

Proposed Business Combination

Business Combination Agreement

        On March 2, 2020, the Company entered into a business combination agreement (the "Business Combination Agreement") with VCTIQ Merger SubCorp., a Delaware corporation and wholly-owned subsidiary of the Company ("Merger Sub"), and Nikola Corporation, a Delaware corporation ("Nikola"), pursuant to which the Company will effect a businesscombination with Nikola (the "Proposed Transaction").

        Pursuantto the Business Combination Agreement, at the closing of the Proposed Transaction (the "Closing"), Merger Sub will be merged with and into Nikola (the "Merger"), with Nikolasurviving the Merger as a wholly-owned direct subsidiary of the Company. Immediately prior to the effective time of the Merger (the "Effective Time"), Nikola will cause the shares of Nikola'spreferred stock issued and outstanding immediately prior to the Effective Time to be converted into shares of Nikola common stock, and each converted share of Nikola preferred stock will no longer beoutstanding and will cease to exist. At the Effective Time, by virtue of the Merger, all shares of Nikola common stock issued and outstanding immediately prior to the Effective Time will be canceledand converted into the right to receive the number of shares of the Company's common stock equal to the exchange ratio of 1.901 set forth in the Business Combination Agreement (the "Exchange Ratio").Each Nikola stock option that is outstanding immediately prior to the Effective Time, whether vested or unvested, will be converted into an option to purchase a number of shares of the Company'scommon stock equal to the product (rounded down to the nearest whole number) of (i) the number of shares of Nikola common stock

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subjectto such option immediately prior to the Effective Time and (ii) the Exchange Ratio, at an exercise price per share (rounded up to the nearest whole cent) equal to (A) theexercise price per share of such option immediately prior to the Effective Time divided by (B) the Exchange Ratio.

        TheClosing is subject to certain conditions, including but not limited to the approval of the Company's stockholders and Nikola's stockholders of the Business Combination Agreement. TheBusiness Combination Agreement may also be terminated by either party under certain circumstances. Nikola has agreed to customary "no shop" obligations subject to a customary "fiduciary out," andNikola would be required to pay a termination fee in the amount of $82 million if the Business Combination Agreement is terminated under certain circumstances.

        TheClosing will occur as promptly as practicable, but in no event later than three business days following the satisfaction or waiver of all of the closing conditions contained in theBusinessCombination Agreement. If, by May 1, 2020, the Company and Nikola determine that the Closing is unlikely to be consummated on or before May 18, 2020, then the Company will take allactions necessary to obtain the approval of its stockholders to extend its deadline to consummate its initial Business Combination to a date after such date but prior to August 31, 2020 inaccordance with the Company's amended and restated certificate of incorporation.

Stockholder Support Agreement

        Also on March 2, 2020, certain stockholders of Nikola holding the votes necessary to approve the Proposed Transaction entered into aStockholder Support Agreement with the Company (the "Stockholder Support Agreement"), pursuant to which such stockholders agreed to vote all of their shares of Nikola capital stock in favor of theapproval and adoption of the Proposed Transaction. Additionally, such stockholders agreed not to (i) transfer any of their shares of Nikola capital stock (or enter into any arrangement withrespect thereto) or (ii) enter into any voting arrangement that is inconsistent with the Stockholder Support Agreement.

Registration Rights and Lock-Up Agreement

        Pursuant to the Business Combination Agreement and as a condition to the Closing, the Company, certain persons and entities holding the FounderShares and Private Placement Units (the "Original Holders") and certain stockholders of Nikola (the "New Holders" and, collectively with the Original Holders, the "Holders") will enter into aRegistration Rights and Lock-Up Agreement at the Closing (the "Registration Rights and Lock-Up Agreement"). Pursuant to the terms of the Registration Rights and Lock-Up Agreement, the Company will beobligated to file a registration statement to register the resale of certain securities of the Company held by the Holders. In addition, pursuant to the terms of the Registration Rights andLock-Up Agreement and subject to certain requirements and customary conditions, including with regard to the number of demand rights that may be exercised, the Holders may demand at any time or fromtime to time, that the Company file a registration statement on Form S-3 (or on Form S-1 if Form S-3 is not available) to register the Company's securities held by suchHolders. The Registration Rights and Lock-Up Agreement will also provide the Holders with "piggy-back" registration rights, subject to certain requirements and customary conditions. The RegistrationRights and Lock-Up Agreement does not provide for the payment of any cash penalties by the Company if it fails to satisfy any of its obligations under the Registration Rights and Lock-Up Agreement.

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        TheRegistration Rights and Lock-Up Agreement further provides for the securities of the Company held by the Holders to be locked-up for a period of time following the Closing, asdescribed below, subject to certain exceptions. The securities held by the Original Holders will be locked-up for one year following the Closing, subject to earlier release if (i) the reportedlast sale price of the Company's common stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 tradingdays within any 30-trading day period commencing at least 150 days after the Closing or (ii) if the Company consummates a liquidation, merger, stock exchange or other similar transactionafter the Closing which results in all of the Company's stockholders having the right to exchange their shares of common stock for cash, securities or other property. The securities held by the NewHolders, other than certain entities controlled by Trevor Milton, the current Chief Executive Officer of Nikola, will be locked-up for 180 days after the Closing. The securities held by certainentities controlled by Trevor Milton will be locked up for one year following the Closing, except that they would be permitted to sell or otherwise transfer an aggregate of $70.0 million sharesof the Company's common stock commencing 180 days after the Closing.

Subscription Agreements

        In connection with the execution of the Business Combination Agreement, effective as of March 2, 2020, the Company entered into separatesubscription agreements (each, a "Subscription Agreement") with a number of investors (each a "Subscriber"), pursuant to which the Subscribers agreed to purchase, and the Company agreed to sell to theSubscribers, an aggregate of 52,500,000 shares of the Company's common stock (the "PIPE Shares"), for a purchase price of $10.00 per share and an aggregate purchase price of $525 million, in aprivate placement (the "PIPE").

        Theclosing of the sale of the PIPE Shares pursuant to the Subscription Agreements is contingent upon, among other customary closing conditions, the substantially concurrent consummationof the Proposed Transaction. The purpose of the PIPE is to raise additional capital for use by the combined company following the Closing.

        Pursuantto the Subscription Agreements, the Company granted certain registration rights to the Subscribers, including the Company's agreement that, within 45 calendar days after theClosing (the "Filing Deadline"), the Company will file with the SEC a registration statement registering the resale of the PIPE Shares (the "Resale Registration Statement"), and will use itscommercially reasonable efforts to have the Resale Registration Statement declared effective as soon as practicable after thefiling thereof. Under certain circumstances described in the Subscription Agreements, including if the Resale Registration Statement has not been filed with the SEC by the Filing Deadline, additionalpayments by the Company may be assessed with respect to the PIPE Shares The additional payments by the Company would accrue on the applicable registrable securities at a rate of 0.5% of the aggregatepurchase price paid for such registrable securities per month, subject to certain terms and limitations (including a cap of 5.0% of the aggregate purchase price)

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