Apt For Elon Musk –
Think Before You Ink
A single tweet turned the tables of one of the successful entrepreneur of the world. 7th August the day when Elon Musk Twitter said;
Am considering taking Tesla private at $420. Funding secured.
— Elon Musk (@elonmusk)
And things turned!
Elon Musk statement that he is on the verge to turn his company private and all investors agree to it is a mishap. Post the tweet, the Security Exchange and Commission stepped forward to investigate and judge the credibility of his statement.
SEC found that Musk held few meeting with the sovereign wealth fund of Saudi Arabia, but no strong consensus validated his statement. He misled all with his fake news. They sued his court and asked him to justify his statement. Elon Musk is earlier sure about the case sought to prove his point.
After few calculations, he sought to agree with the SEC. A settlement to deter the case filled instead of the false statement of privatization.
Elon Musk – SEC Settlement
Though the first hearing is to happen in February next year, Elon Musk takes a safe call and decide to make a settlement with the SEC and other corresponding investors of Tesla. Among all the abducts, Elon needs to :
- Step down as the Chairman Of Tesla within 45 days.
- He cannot step back in a time buffer of three years.
- Elon Musk and his Tesla have to pay a fine of $20 million which would be shared amongst the investors.
- A lawyer would be appointed to take care of all the tweets and his oversee communication. Elon Musk Twitter is no longer personal.
- Two new members in Tesla’s BOD to make a more efficient decision.
In addition to all of the above, Elon Musk has to sign an agreement where he agrees that he will not either deny or accept if he is guilty of the claims charged on him. Elon has no rights to justify himself publicly. One wrong statement and Elon has made things tougher for himself.
Elon Musk must step down as chairman and pay a $20 million fine over his misleading "taking Tesla private" tweet
— TicToc by Bloomberg (@tictoc)
But why settlement?
While Elon Musk must be mindfully active while tweeting, he never knew that it would pop out as a turning point in his life. The court charges and trails were not acceptable, and so he decided to settle with the SEC. But why?
Because Elon was very well aware that he did not discuss the decision of privatizing his company at the share of $420, also, he did not inform the investors about the same. The investors had no idea if he had the potential to indulge in a private transaction. He did not initiate the investors that they would be the group of particular fund purpose of the company. All of these jointly compelled Musk to enter into a settlement.
Elon Musk took the above step to avoid all the bitter situations, the tantrum and the fight that could have aggravated otherwise. Though Elon would remain the CEO, his role as a chairman stands deterred. A massive step was taken by the US securities to ensure trust among the shareholders of the automated company Tesla.
The Decision has been made leaving Musk saddened and deeply hurt.
A new era is now to start in