Monday, October 1, 2018

Musk Accepts Settlement with SEC. Good Changes On Its Way

It's late, and I've just started a full-time job. Great source for more "investment" money, but limits my time to do other stuff. So I'm just going to quickly ramble here so I can go to bed. I can't possible skip the big news after the market closed today.

There are lots of places to read the settlement between Elon Musk and SEC.  Click here for the official statement from SEC on their website.


Essentially, It's a $40 million penalty ($20mM for Musk, and $20M for Tesla who is found in violation for not keeping Elon under control.)

The biggest, and most scariest to me, is that Elon Musk must step down as Board Chairman, and will not be able to reapply for that position for 3 years (it's posted as 4 years in another source). Why scary? He has to be replaced with two independant members. While the board will nominate candidates, shareholders will vote. I am hoping that the Board members have a sum of more than 50% of the shares in the company, and I can trust that they will choose appropriate members to keep Tesla's incredible entrepreneurial run alive. The worst case scenario, shareholders are fooled into accepting someone who doesn't have the mission of Tesla at the centre of their decisions. Yes, Tesla needs to be profitable... but only because it needs to make money to sustain its forward momentum in development and innovation. Not simply to give out make cushy rich people more rich.

I'm preparing myself for an onslaught of campaigning in the media from the short sellers to appoint someone who will attack Tesla from the inside. However, I do have faith in the current board that they will not let that happen.

Apparently, the market sees this settlement as a good thing! It's very sad that I didn't have any funds to purchase more shares when I had the chance. That may have possibly been the last chance to buy them under $300.


MY POSITIONS FOR TODAY
As of October 1, 2018 closing.


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