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The Securities and Exchange Commission said Monday that a federal court should bind Elon Musk, Tesla's CEO, because he made a new statement on Twitter in defiance of the settlement agreement reached with the SEC last year. This led to a 5% drop in Tesla's share price after the market.
Musk, Tesla and SEC settled a lawsuit filed by the SEC last year. The lawsuit accused Musk of misleading tweets in August about his plans to privatize Tesla. As part of the settlement agreement, any important statements made by Musk in the social media are subject to Tesla's prior review.
The SEC referred to Musk's tweet published on February 19: "Tesla will produce zero cars in 2011, but will reach about 500,000 vehicles in 2019," saying that Musk did not seek or obtain permission before publishing the tweet. The tweet was inaccurate, but spread to more than 24 million people.
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