[vc_row][vc_column][vc_column_text]Tesla Chief Executive Elon Musk has been clear that he does not respect the U.S. Securities and Exchange Commission, but he has agreed to at least respect their rules for what he can say on Twitter, according to an agreement filed late Friday.
The amended filing in the in U.S. District Court of the Southern District of New York is related to a S.E.C. complaint that Musk violated a previous agreement over his use of Twitter.
The new agreement still needs court approval, but it would provide more specific guidance for how Tesla communicates and what oversight is required. It would also keep Musk from being held in contempt of court, as the S.E.C. had previously requested.
According to the agreement, formal legal review is now required for the company’s blog, statements made on investor calls, and social media posts for material information. The list includes:
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;
Musk agreed in October to settle an SEC fraud complaint related to his tweets touting that he had “funding secured” to take the automaker private. As part of the settlement, Musk agreed to have potentially market-moving tweets reviewed before hitting send.[/vc_column_text][vc_video link=”https://www.youtube.com/watch?v=cRNypdYQoWk” video_title=”1″][vc_column_text]The SEC then said a February 19 tweet from Musk violated the agreement and asked a judge to hold him in contempt.
The tweet said “Tesla made 0 cars in 2011, but will make around 500k in 2019.” A follow-up tweet a few hours later updated the delivery number to 400,000 cars this year.
The SEC said those tweets weren’t approved, and argued that in fact no tweet from Musk had received prior review.
U.S. District Judge Alison Nathan judge declined to rule on the contempt motion at an April 4 court hearing, and instead told the SEC and Musk to work out their differences and come to a settlement.[/vc_column_text][/vc_column][/vc_row]
The amended filing in the in U.S. District Court of the Southern District of New York is related to a S.E.C. complaint that Musk violated a previous agreement over his use of Twitter.
The new agreement still needs court approval, but it would provide more specific guidance for how Tesla communicates and what oversight is required. It would also keep Musk from being held in contempt of court, as the S.E.C. had previously requested.
According to the agreement, formal legal review is now required for the company’s blog, statements made on investor calls, and social media posts for material information. The list includes:
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;
Musk agreed in October to settle an SEC fraud complaint related to his tweets touting that he had “funding secured” to take the automaker private. As part of the settlement, Musk agreed to have potentially market-moving tweets reviewed before hitting send.[/vc_column_text][vc_video link=”https://www.youtube.com/watch?v=cRNypdYQoWk” video_title=”1″][vc_column_text]The SEC then said a February 19 tweet from Musk violated the agreement and asked a judge to hold him in contempt.
The tweet said “Tesla made 0 cars in 2011, but will make around 500k in 2019.” A follow-up tweet a few hours later updated the delivery number to 400,000 cars this year.
The SEC said those tweets weren’t approved, and argued that in fact no tweet from Musk had received prior review.
U.S. District Judge Alison Nathan judge declined to rule on the contempt motion at an April 4 court hearing, and instead told the SEC and Musk to work out their differences and come to a settlement.[/vc_column_text][/vc_column][/vc_row]
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