- 29th April 2019
- Posted by: Bigwig Fx
- Category: Business plans, Competitive research, Economics, Funding trends, Innovation, International, INVESTMENT, Technology
Tesla CEO Elon Musk has reached an agreement with the Securities and Exchange Commission over his use of Twitter, according to an amended filing in U.S. District Court of the Southern District of New York.
The late Friday agreement, which still needs to be approved by a judge, lays out exactly what kind of information requires formal legal review before being shared. This oversight process is now required for the company’s blog, statements made on investor calls, as well as social media posts for material information.
The filing laid out the following items in that list:
- the Company’s financial condition, statements, or results, including earnings or guidance;
- potential or proposed mergers, acquisitions, dispositions, tender offers,or joint ventures;
- production numbers or sales or delivery numbers (whether actual, forecasted, or projected) that have not been previously published via pre-approved written communications issued by the Company (“Official Company Guidance”) or deviate from previously published Official Company Guidance;
- new or proposed business lines that are unrelated to then-existing business lines (presently includes vehicles, transportation, and sustainable energy products);
- projection, forecast, or estimate numbers regarding the Company’s business that have not been previously published in Official Company Guidance or deviate from previously published Official Company Guidance;
- events regarding the Company’s securities (including Musk’s acquisition or disposition of the Company’s securities), credit facilities, or financing or lending arrangements;
- nonpublic legal or regulatory findings or decisions;
- any event requiring the filing of a Form 8-K by the Company with the Securities and Exchange Commission, including:
– a change in control; or
– a change in the Company’s directors; any principal executive officer, president, principal financial officer, principal accounting officer, principal operating officer, or any person performing similar functions, or any named executive officer; or
- such other topics as the Company or the majority of the independent members of its Board of Directors may request, if it or they believe pre-approval of communications regarding such additional topics would protect the interests of the Company’s shareholders;
Tesla did not immediately reply to a request for comment.
Shares of Tesla gained about 0.9% in postmarket trading. The stock had shed 5% during the normal session and has fallen 29% so far in 2019.
Friday’s agreement “removes an overhang” for Tesla shareholders, said Dan Ives, managing director for equity research at Wedbush Securities.
“Some feared the SEC situation was not going to be resolved favorably so this resolution is a sigh of relief for the bulls. Tesla has enough bad news on its plate so this removes one headache for the Street with the focus now core demand and profitability,” he said.
This superseding agreement settles a dispute between the SEC and Musk about whether the Tesla chief violated the terms of their original deal in which he had agreed to clear his tweets containing material information about the company before posting. The SEC had asserted that Musk never sought clearance for any tweet.
The U.S. regulatory agency had claimed that Musk broke the terms of that agreement in February when he tweeted about Tesla production numbers for 2019.
The SEC first charged Musk last year, alleging he made fraudulent statements on Twitter. On Aug. 7, Musk tweeted that he had “funding secured” to take Tesla private at $420 per share.
In the first deal, Musk had also agreed to pay a civil penalty of $20 million and forfeit his role as chairman of the board for at least three years. The company also paid a $20 million fine.