The Nikola Two FCEV Sleeper is a long-haul freight solution with hydrogen capacity allowing a non-stop range of up to 900 miles. The Two FCEV leverages the weight advantage of hydrogen in long-range, long-haul zero-emission commercial transportation. The Two FCEV will be based on a new chassis custom designed for North American long-haul routes and is anticipated to launch in late 2024.
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Nikola agrees to $125 million fine for misleading investors

Nikola, the hydrogen truck maker, has often been in the news cycle for unflattering reasons. However, this time, it appears to be cleaning up its mess. The company has agreed to pay a $125 million fine for misleading investors.

This resolution of the case against Nikola was announced by the US Securities Exchange Commission (SEC). The regulatory body had accused the startup of defrauding investors by making false claims about its products and technical capacities. The misleading statements were made in 2020 and inflated its financial prospects.

Founder and former CEO Trevor Milton was arrested this year for painting a false picture of his company and making it look close to shipping actual products. He was mentioned explicitly in SEC’s press release on the resolution of the charges:

“The Securities and Exchange Commission today announced that Nikola Corporation, a publicly traded company created through a special purpose acquisition company transaction, has agreed to pay $125 million to settle charges that it defrauded investors by misleading them about its products, technical advancements, and commercial prospects. The settlement follows the SEC’s litigated action filed earlier this year against Trevor Milton, the company’s founder and former Chief Executive Officer and Executive Chairman.

“According to the SEC’s order, before Nikola had produced a single commercial product, Milton embarked on a public relations campaign aimed at inflating and maintaining Nikola’s stock price. Milton’s statements in tweets and media appearances falsely gave investors the impression that Nikola had reached certain product and technological milestones. The order finds that Milton misled investors about Nikola’s technological advancements, in-house production capabilities, hydrogen production, truck reservations and orders, and financial outlook. The order also finds that Nikola further misled investors by misrepresenting or omitting material facts about the refueling time of its prototype vehicles, the status of its headquarters’ hydrogen station, the anticipated cost and sources of electricity for its planned hydrogen production, and the economic risks and benefits associated with its contemplated partnership with a leading auto manufacturer.”

Nikola will pay the fine in over two years, in five installments. The first payment is due at the end of December.

The company, in its own release, expressed its relief at the conclusion of the case. “We are pleased to bring this chapter to a close as the company has now resolved all government investigations.” Nikola did not admit nor deny the charges but agreed to the fine and desist from such acts in the future. It will also make some voluntary disclosures.

Defrauded investors will get compensation from the fine. The SEC is still conducting investigations, and Nikola will cooperate fully.

The startup appears keen to move on, as it reports it has actually delivered two trucks to a customer. It had gone public last year through the SPAC route.  However, the founder, Milton is not ready to let go as he filed motions to have the case against him dismissed.

Commenting on the case, Gurbir S. Grewal, Director of the SEC’s Division of Enforcement, said, “As the order finds, Nikola Corporation is responsible both for Milton’s allegedly misleading statements and for other alleged deceptions, all of which falsely portrayed the true state of the company’s business and technology. This misconduct — and the harm it inflicted on retail investors — merits the strong remedies today’s settlement provides.”

Nikola has had quite a turbulent history. It made a splash with its hydrogen-powered trucks and even got the attention of General Motors, which agreed to buy 11 percent of the company but pulled out later. This was after an investment firm Hindenburg Research published a damning report into how Nikola was deceiving the public with tricks like showing off a video of a truck rolling down a hill on its own as a working prototype. It resulted in the ouster of Milton as CEO and board chairman. SEC then decided to conduct an investigation.

Written by HackerVibes

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