DETROIT – Nikola Corp.shareholders approval will be required to dilute further the stock. To raise capital, 200 million additional shares will also need to be added.

The company said the increase – from 600 million to 800 million shares – is in the “best interests” of the company and its shareholders, according to Nikola’s proxy statementFiled Friday with the Securities and Exchange Commission.

The company stated that if shareholders do not approve of the June 1st increase, it may be “constrained” in its ability raise capital to meet our business goals. It also could lose valuable business opportunities to rivals, which would adversely impact our financial performance as well as our growth.

Based on the Nikola’s stock price Monday of about $7 a share – down from a 52-week high of $19.52 – the company would raise about $1.4 billion in capital from the additional shares. Nikola stock dropped 8.6% Monday during intraday trades. In 2022, shares have fallen by 30%.

According to FactSet, Nikola holds approximately 414 million shares outstanding.

Kim Brady, Nikola Chief Financial Officer last month stated that the struggling electric vehicle company had been recently settled a federal probe that charged it with misleading investors, would “monitor the equity capital markets closely and raise additional capital when appropriate in 2022.” 

Nikola reported a cash balance in the amount of $522million at year end. In 2022, it plans to spend $295 million to $305 million. According to two equity lines, it also has $436 millions of liquidity.

Nikola last month projected it would generate revenue of between $90 million and $150 million in 2022 on deliveries of between 300 and 500 of its first battery-electric semitrucks — known as the Nikola Tre — to customers.

Nikola Chair Stephen Girsky said that he will ask shareholders for approval for executive compensation. This includes an annual salary of $1 per executive officer. However, the executives are being compensated in stock awards that are valued at millions of dollars.

For example, Nikola CEO Mark Russell’s total compensation was $5.6 million in stock awards in 2021, according to the filing. The filing shows that Russell controls 11.7%, which includes shares held by Trevor Milton, the former Nikola founder, and chair, according to the filing.

Milton resigned from the company in September 2020 after short seller Hindenburg Research accused him of making false statements about the company’s technology to attract investors and partnerships.

Milton will be tried in Manhattan on April 4, for allegedly defrauding investors during the company’s IPO.

— CNBC’s Lora KolodnyThis report was contributed by you.