Tesla jumps after Musk reaches settlement agreement between SEC and SEC

Shares of Tesla Inc. (TSLA) surged on Monday, after Eonon Musk agreed to settle fraud charges against the Securities and Exchange Commission over the weekend, which will allow him to remain CEO of the company. He founded. he is obliged to leave his position as chairman of the board of directors.

Musk reached an agreement with the SEC just two days after the authorities reported making false and misleading statements on Aug. 7, when it told its 22.7 million Twitter subscribers that he had obtained a "financing" to privatize the clean energy car manufacturer at a reasonable price. Musk agreed to pay $ 20 million – while Tesla agreed to pay the same amount – in exchange for Musk's departure from the board of directors and the appointment of two new independent directors and a chairman. .

"The prompt settlement of this case on agreed terms is in the interest of markets and investors, including Tesla shareholders," said SEC Chairman Jay Clayton. "At the Commission, the interests of ordinary investors are at the forefront of our concerns, and in cases of professional misconduct, we seek to serve those interests to the extent possible while ensuring that mistakes are corrected and discouraged."

"In addition, holding individuals accountable is an effective deterrent, and I believe that the regulations agreed today reflect these multiple interests and considerations," Clayton added.

Tesla shares rose 15.4% on Monday, indicating a selling price of $ 305,495 each, which should allow the stock to move closer to the balance of the year and enhance the Palo-based automaker Alto, California. about $ 52 billion.

The SEC had sought to remove Musk from his position as CEO of Tesla and forbid him to perform similar duties in any other US company and to return "any ill-gotten gain" from Tweet and an undisclosed civil fine at the time. filing of his complaint. his initial charges

"Integrity is the most important value of my life and the facts will show that I have never compromised it in any way," Musk said in a statement.

Musk is not obliged to admit or deny the findings of the SEC investigation, according to the terms of the settlement that still require court approval, but the fact it will be able to keep control of the company, just as Bold production targets for the flagship model 3 will provide tremendous relief to investors who have suffered two months of great volatility towards the automaker.

JPMorgan issued a memo on Tesla Friday saying that Musk's continued involvement as an officer of the company was crucial to his success, and said that heightened questions about his fate could affect the ability of the company to raise capital. Bob Lutz, a former General Motors (GM) executive and longtime Tesla critic, told CNBC that Tesla would likely be unable to raise new capital if it was the subject of an active investigation by the company. share of the SEC.

Musk sent the infamous Tweet at 12:48 pm ET on August 7th, which immediately pushed up 6% to $ 387.46 each. However, given the lack of detail in Musk's subsequent communication and statements, the stock has fallen sharply since then, as investors questioned not only Musk's preferred form of communication, but also a series of news items. 39, more and more troubling actions of the 47-year-old billionaire. top-level departures from the Tesla management team.

In fact, Musk's public behavior since the August Tweet has raised serious questions about his ability to run a public company, the founder of the billionaire himself having told The New York Times last month that his year was the most difficult and painful. career.

Since the interview, however, Musk has been confronted with controversy – and the increasingly active legal agenda – by reconnecting with a disciple with Vernon Unsworth, a British diver on the 12-member rescue team. Thai boys from a local football team. , accompanied by their coach, trapped in a cave under the mountain Doi Nang No, on the border of Myanmar.

"This is an old single man of English origin who lives or lives in Thailand for 30 or 40 years, mainly in Pattaya Beach, before moving to Chiang Rai for a bride of about 12 years old at the time, "said Musk Buzzfeed in an email earlier this week in which he called Unsworth a" child molester ". "There is only one reason people go to Pattaya Beach," Musk told Buzzfeed.

"The man who has created tens of billions of dollars in capitalization for an unprofitable business through real expertise goes further down a path that will destroy it," wrote David Butler, a contributor at Real Money . "With every tweet, every nonsensical statement, every promise that can not be held, Musk destroys the credibility Tesla desperately needs to succeed."