Seen at an event in New York in early May, Elon Musk is actively calling for a facility to produce his electric vehicle “end-to-end” in resource-rich Indonesia. ..
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Activist investor SOC Investment Group We asked federal financial regulators to investigate Tesla’s plans to reduce the size of its board from eight to seven and close one of its independent directors.
Tesla announced in its June preliminary mandate solicitation: Oracle Founder Larry Ellison has no plans to run for reelection at this year’s annual shareholders meeting, and the company has no plans to appoint a new person to replace him. According to a letter to the agency shared with CNBC, the investor group requested the Securities and Exchange Commission to refuse the submission.
Formerly known as the CtW Investment Group, Tesla and Elon Musk will continue to use social media to disclose important business information without the prior approval of a securities lawyer, Tesla and Musk 2018. Claims to violate the terms of the settlement agreement signed with the SEC.
Rich Clayton, SOC research director, told CNBC this week that his group has long been concerned about “the independence of Tesla’s board.” He mentioned that Tesla acquired SolarCity in 2016. This is a company founded by Musk’s first cousin, funded by Musk and served on the board.
“The board has repeatedly made decisions driven by Elon Musk’s personal interests, not in the best interests of Tesla in the long run,” Clayton told CNBC.
“I think other long-term shareholders should be concerned about the proposed changes in the composition of the board,” he said. “The Tesla Board of Directors was willing to respond to shareholders by doing what they wanted. They can avoid having shareholders propose and vote.”
The SEC is considering keeping Tesla private for $ 420 per share, and after Musk tweeted that it had “funded” for the deal, Tesla and Musk were scammed in civil securities in 2018. I complained. Stocks soared and then trading stopped. In the 16 months that followed, Tesla shares hit a three-year low in June 2019 at around $ 177 per share, before surpassing $ 420 in the second half of the year. Stocks are currently trading at around $ 670 after peaking above $ 1,200 in November.
To meet the terms of the consent judgment, Musk and Tesla each pay a fine of $ 20 million, and Musk tweets with information that may affect Tesla shares scrutinized by a securities lawyer prior to posting. I agreed. Tesla’s board also needed to increase the proportion of independent directors to that rank.
Tesla’s board includes several personal or business associates at Mask, including his brother Kimbal, who until recently served on the board of spaceX, an aerospace venture, throughout his life as a public company.
Tesla appointed Ellison and Yuan Walgreens Kathleen Wilson Thompson executives will serve as Independent Directors at the end of 2018 and will change their composition. At that time, Ellison called himself Elon Musk’s “very close friend.” He also owned about $ 1 billion in stake in an electric vehicle company.
In this month’s letter to the SEC, SOC wrote:
“Sufficient evidence, including a statement from CEO Elon Musk, is a credible advance that Tesla’s board of directors is not effectively monitoring, or Musk’s potential follow-up, contrary to the requirements of the Consent Decree. An important official statement about Tesla showing that it has not established an approval process. “
The group added, “As a result of not complying with the Consent Decree, Tesla’s shareholders experienced a sharp change in the value of their shares, triggered by just such a statement from Mr. Musk. Take action against him and Tesla. “
The SEC has already begun multiple investigations by Elon Musk and Tesla on the potential for insider trading. Disclosure According to his Twitter shares and compliance with the settlement agreement Correspondence Between the agency and Tesla and court documents.
Mask also blamed the SEC Crush His right to freedom of speech through the settlement and its investigative activities urged him to break out of at least some of the terms of the settlement agreement.
Tesla and Mask are represented by Alex Spiro in SEC issues. When CNBC presented the activist investor’s letter, they did not respond to a request for comment.
The SOC Investment Group works with a pension fund sponsored by a union with approximately $ 250 billion in assets under management. This group typically submits shareholder resolutions on corporate governance and social responsibility. Notify regulators, other shareholders and pension fund managers if a company in the portfolio appears irresponsible and may adversely affect the company’s long-term financial position.
The same group helped McDonald’s shareholders, for example, force McDonald’s shareholders to vote for an independent civil rights assessment of fast-food giants after filing several anti-discrimination and harassment proceedings over the past few years. I did.
Tesla faces a myriad of lawsuits on suspicion of racist discrimination against black employees, but the SOC Investment Group does not currently propose that Tesla conduct racist audits.
“The lack of independence seen in Tesla’s board clearly shows that it’s difficult to get the board to do the right thing in terms of dealing with serious internal issues, cases and allegations,” Clayton said. I will. “
Read the letter here.