Musk Sees "Victory" Tuesday, SEC Deal: Tesla Jumps
03 October, 2018, 01:38 | Author: Darnell Patrick
The electric auto maker's shares sank last week after the US Securities and Exchange Commission accused Musk of securities fraud, opening up the prospect of a long fight that could have seen Tesla lose its leader, and undermined its ability to raise capital and increase production.
This weekend's settlement made clear that Musk was neither accepting guilt nor denying the SEC's allegations.
Musk, whose tweets on August 7 on a plan to take Tesla private that was later abandoned, has been barred from tweeting about Tesla without the permission of a company lawyer. As part of that deal, Musk also has to pay $20 million in fines. Secondly, the company's board will also appoint two new independent directors, with a new committee dedicated but not limited to regulating Musk's communications as he remains CEO.
The extraordinary support for Musk and the Tesla brand is underlined by the company's huge valuation - which is very much a bet on the future - and the extraordinary reports this past week or so o Tesla enthusiasts volunteering to help Tesla make the deliveries needed to reach its targets.
In fact, the biggest impact will be the new chairperson of Tesla. One tweeted to Musk last month: "There are 42 Tesla's sitting at the Union Pacific Railroad in SLC".
As part of Elon Musk's settlement with the SEC, he agreed to resign from his role as chairman in 45 days.
In the immediate aftermath of the "funding secured" tweet, Tesla stock rose by six per cent. However, if found guilty, Musk stood to lose a lot more than $20m and could have been ousted as CEO of the company.
Tesla has struggled to quickly boost production of the Model 3, a vehicle that is seen as critical to the upstart's growth plans. There remain significant opportunities to grow the addressable market for Model 3 by introducing leasing, standard battery and other lower-priced variants of the auto, and by starting worldwide deliveries. When confronted by customers waiting for vehicles for which they've put down a payment, Musk has said Tesla is encountering difficulties delivering cars to customers due to a shortage of car-hauling trucks, but experts say no such shortage exists and that other automakers are shipping their cars around the United States just fine. The complaint "alleges that Musk violated antifraud provisions of the federal securities laws, and seeks a permanent injunction, disgorgement, civil penalties, and a bar prohibiting Musk from serving as an officer or director of a public company", the SEC said on Thursday when it filed the complaint at court.
However, Musk has agreed to a condition where he will not admit nor deny if he was guilty of committing the securities fraud. In the immediate aftermath of the "funding secured" tweet , Tesla stock rose by six per cent.
He thinks they've been too accommodating to Ford - and now also wants them to accommodate Ramirez? "We've had a good talk. Judge Kavanaugh and another accuser from his high school years this week testify before a US Senate panel.
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If he will not, at the very least, the hearing and vote should be postponed while the FBI investigates all of these allegations. She said she was able to escape, and she described the episode to a therapist in 2013 as a "rape attempt".
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Every single time we come off to the sidelines, everybody's excited about what just happened on the field. He underthrew Tyreek Hill by a yard or two allowing Richard Sherman to catch up and break the pass up.
Without that birdie, Woods would have won his third FedEx Cup title after starting at No. 20 going into the Tour Championship. Not only did it end Woods' five-year wait, it moved the 14-time major champion within two victories of Snead's record.
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