SAN FRANCISCO: Tesla and its CEO Elon Musk have agreed to pay a total of $40 million and make a series of concessions to settle a government lawsuit alleging Musk duped investors with misleading statements about a proposed buyout of the company.
The settlement with the Securities and Exchange Commission allows Musk to remain CEO of the electric car company but requires him to relinquish his role as chairman for at least three years.
Tesla must hire an independent chairman to oversee the company, something that should please a number of shareholders who have criticized Tesla’s board for being too beholden to Musk.
The deal was announced Saturday, just two days after SEC filed its case seeking to oust Musk as CEO.
Musk, who has an estimated $20 billion fortune, and Tesla, a company that ended June with $2.2 billion in cash, each are paying $20 million to resolve the case, which stemmed from a tweet Musk sent on Aug. 7 indicating he had the financing in place to take Tesla private at a price of $420 per share.
“A reckless tweet cost a lot of money — the $20-million tweet,” said Michelle Krebs, executive analyst at Autotrader.
The deal could remove one cloud that hangs over Tesla. Investors fretted about the company’s ability to cope without Musk, a charismatic entrepreneur whose penchant for coming up with revolutionary ideas has drawn comparisons to one of Silicon Valley’s most revered visionaries, Apple co-founder Steve Jobs.
Tesla’s stock plummeted 14 percent Friday after the SEC filed its lawsuit, erasing more than $7 billion in shareholder wealth. Many analysts predicted the shares were bound to fall even further if Musk had been forced to step down. Tesla’s stock has dropped 30 percent since Aug. 7, closing Friday at $264.77.
The steep downturn in Tesla’s market value may have influenced Musk to have an apparent change of heart and negotiate a settlement. Musk had rejected a similar settlement offer before the SEC sued Thursday, maintaining he had done nothing wrong when he posted a tweet declaring that he had secured the financing to lead a buyout of Tesla.
The SEC alleged Musk wasn’t close to locking up the estimated $25 billion to $50 billion needed to pull off the buyout.
Musk and Tesla reached their settlement without admitting to or denying the SEC’s allegations.
The resolution “is in the best interests of our markets and our investors, including the shareholders of Tesla,” SEC Chairman Jay Clayton said in a statement.
A Tesla spokeswoman said the company and Musk had no comment Saturday.
Besides paying a fine and stripping Musk of his chairman’s title, Tesla also must appoint two more directors who have no ties to the company or its management. Musk will be allowed to remain on the board.
The company also must clamp down on Musk’s communications with investors, a requirement that might make its colorful CEO’s Twitter posts slightly less interesting.
“Considering the drastic punishment the SEC had announced, Musk and Tesla got lucky,” said Krebs, the Autotrader analyst. “Musk at least remains at the helm of the company, and adding a couple of board members is a good thing.”
The SEC also got what it wanted by bringing the combative Musk down a notch and taking steps to tone down his off-the-cuff remarks while forcing Tesla to expand its board to counterbalance its CEO’s power, said Carl Tobias, a law professor at the University of Richmond. Besides being CEO, Musk owns a roughly 20 percent stake in Tesla.
“Maybe this will make Musk stop acting so crazy and fly right,” Tobias said.
Besides tweeting about a deal that the SEC alleged he didn’t have money to pay for, Musk had been engaging in other erratic behavior that had been raising questions about whether he should remain CEO.
Musk had raised hackles by ridiculing stock market analysts for posing fairly standard questions about Tesla’s shaky finances, and calling a diver who helped rescue 12 boys on a Thai soccer team from a flooded cave a pedophile, triggering a defamation lawsuit. He was also recently caught on a widely circulated video apparently smoking marijuana , a legal drug in Tesla’s home state of California.
The erratic behavior has convinced more analysts that Tesla needs to find a replacement for Musk, but the SEC settlement will allow the company to do so on its own timetable, if it decides to hire a new leader.
Tesla is also under mounting pressure to overcome its past manufacturing problems and produce enough vehicles to become consistently profitable after years of huge losses.
A gauge of the company’s progress should come within the next few days when Tesla is expected to release its vehicle production numbers for the July-September period.
Musk has pledged Tesla would manufacture an average of 7,000 vehicles per week, enough to turn a profit.
Tesla needs to turn the financial corner because it has $1.3 billion in debt coming due during the next six months. If it keeps burning through its cash, Tesla will likely have to raise more money to pay its bills — something that analysts say will be easier to do without any lingering doubt who will be running the company.
Musk out as Tesla chair, remains CEO in $40M SEC settlement
Musk out as Tesla chair, remains CEO in $40M SEC settlement
- The settlement allows Musk to remain CEO of the electric car company but requires him to relinquish his role as chairman for at least three years
- The deal was announced Saturday, just two days after SEC filed its case seeking to oust Musk as CEO
’Real-world harm’ if Meta ends fact-checks, global network warns
- Mark Zuckerberg said earlier this week Meta will loosen content moderation policies in the US, citing bias and excessive censorship
- Announcement sparked international outcry, alarm amid fears of serious consequences
WASHINGTON: There will be “real-world harm” if Meta expands its decision to scrap fact-checking on Facebook and Instagram, a global network warned Thursday while disputing Mark Zuckerberg’s claim such moderation amounts to censorship.
Meta founder and CEO Mark Zuckerberg’s surprise announcement this week to slash content moderation policies in the United States has sparked alarm in countries such as Australia and Brazil.
The tech tycoon said fact-checkers were “too politically biased” and the program had led to “too much censorship.”
But the International Fact-Checking Network, which includes AFP among its dozens of member organizations globally, said the censorship claim was “false.”
“We want to set the record straight, both for today’s context and for the historical record,” said the network.
Facebook pays to use fact checks from around 80 organizations globally on the platform, as well as on WhatsApp and Instagram.
There could be devastating consequences if Meta broadens its policy shift beyond US borders, to programs covering more than 100 countries, the International Fact-Checking Network warned.
“Some of these countries are highly vulnerable to misinformation that spurs political instability, election interference, mob violence and even genocide,” the network said.
“If Meta decides to stop the program worldwide, it is almost certain to result in real-world harm in many places,” it added.
In Geneva Friday, the United Nations rights chief also insisted that regulating harmful content online “is not censorship.”
“Allowing hate speech and harmful content online has real world consequences. Regulating such content is not censorship,” Volker Turk said on X.
AFP currently works in 26 languages with Facebook’s fact-checking scheme.
In that program, content rated “false” is downgraded in news feeds so fewer people will see it and if someone tries to share that post, they are presented with an article explaining why it is misleading.
Supinya Klangnarong, co-founder of Thai fact-checking platform Cofact, said Meta’s decision could have concrete effects offline.
“Understandably this policy from Meta is aimed at US users, but we cannot be certain how it will affect other countries,” she told AFP.
“By allowing the proliferation of hate speech and racist dialogue could be a trigger toward violence.”
Cofact is not an accredited member of the International Fact-Checking Network or of Facebook’s fact-checking scheme.
Meta’s policy overhaul came less than two weeks before US President-elect Donald Trump takes office and it aligns with the Republican Party’s stance.
Trump has been a harsh critic of Meta and Zuckerberg for years, accusing the company of bias against him and threatening to retaliate against the tech billionaire once back in office.
Zuckerberg has been making efforts to reconcile with Trump since his election in November, meeting at his Mar-a-Lago resort in Florida and donating one million dollars to his inauguration fund.
The Meta chief also named Ultimate Fighting Championship (UFC) head Dana White, a close ally of Trump, to the company board.
Angie Drobnic Holan, director of the International Fact-Checking Network, said Tuesday the decision came after “extreme political pressure.”
The move “will hurt social media users who are looking for accurate, reliable information to make decisions about their everyday lives and interactions with friends and family.”
Australia said Meta’s decision was “a very damaging development,” while Brazil warned it was “bad for democracy.”
Meta’s move into fact-checking came in the wake of Trump’s shock election in 2016, which critics said was enabled by rampant disinformation on Facebook and interference by foreign actors, including Russia, on the platform.
Al-Azhar University to establish campus in Pakistan, says Egyptian grand mufti
- Founded in 970 CE, Al-Azhar is known for its scholarship in theology, jurisprudence and Arabic studies
- The grand mufti also asked Pakistan to send scholars to Egypt to benefit from the institution’s expertise
ISLAMABAD: Egyptian Grand Mufti Dr. Nazir Mohamed Ayad announced Friday Al-Azhar University, a renowned center of Islamic learning, plans to establish a campus in Pakistan, a move welcomed by Education Minister Dr. Khalid Maqbool Siddiqui, who pledged full government support during their meeting in Islamabad.
Founded in Cairo in 970 CE, Al-Azhar is celebrated for its rigorous scholarship in Islamic theology, jurisprudence, Arabic studies and modern sciences. With a legacy spanning over a millennium, the university is a key authority on Islamic thought and attracts students globally.
The discussion on branching out into Pakistan took place during a meeting between the two officials, which was also attended by the Egyptian ambassador to Pakistan.
“Dr. Nazir Mohamed Ayad, Grand Mufti of the Arab Republic of Egypt, thanked the federal minister for his warm welcome and said that Al-Azhar University will establish its campus in Pakistan,” read an official statement from Pakistan’s Ministry of Federal Education.
“He said it is important that people learn the Arabic language to understand the true teachings of Islam,” it continued.
The Pakistani minister highlighted the deep cultural and historical ties his country shared with Egypt, both of which, he noted, were part of the world’s oldest civilizations. Siddiqui described Al-Azhar University as a beacon of Islamic scholarship, expressing his aspiration to visit the institution in Cairo.
During the meeting, he also highlighted Pakistan’s upcoming International Girls Conference, scheduled for January 11-12, which aims to promote girls’ education in Islamic countries.
“It is a misconception that Islam does not allow women’s education,” Siddiqui said, emphasizing Pakistan’s commitment to ensuring equal educational opportunities for women.
The Grand Mufti noted that over 40 percent of Al-Azhar University’s students were female. He also encouraged Pakistan to send scholars to Egypt to benefit from the institution’s expertise.
Al-Azhar’s operations are primarily based in Egypt, where it has campuses in several cities. Internationally, the university extends its influence by offering scholarships to students who disseminate its teachings upon returning to their home countries.
The university has also collaborated with educational institutions worldwide and established cultural centers to promote Islamic studies and the Arabic language.
In 2022, Pakistan’s late religious affairs minister, Pir Noor-ul-Haq Qadri, announced plans to open a campus in Lahore.
The initiative, which included Al-Azhar providing faculty, curriculum and textbooks, was to be administratively managed by Pakistan.
Saudi-based doctor receives highest award for overseas Indians
- Dr. Syed Anwar Khursheed among 27 awardees of this year’s Pravasi Bharatiya Samman
- He has served at King Faisal Hospital in Taif and as Royal Protocol physician in Riyadh
NEW DELHI: Dr. Syed Anwar Khursheed, one of the longest-serving Indian physicians in Saudi Arabia, received on Friday the Pravasi Bharatiya Samman Award, the highest honor conferred by India’s president on nationals based overseas.
Dr. Khursheed was born in Gulbarga city in the southwestern state of Karnataka and has spent most of his professional life — more than 40 years — in the Kingdom.
He has served for three decades at King Faisal Hospital in Taif and nearly a decade as a Royal Protocol physician in Riyadh, was involved in the COVID-19 response, and has overseen critical care operations and medical assistance to Hajj pilgrims.
He has also contributed to education, founding the International Indian School in Taif, and provided guidance on the establishment of other schools for the Indian community in Saudi Arabia.
Dr. Khursheed usually travels to India twice a year to see his relatives and hometown, but this time the visit is different, coming with a recognition that he did not expect.
“My heart rate is higher this time,” he told Arab News, as he arrived in India to take part in the ceremony in Bhubaneswar, Odisha.
“I really felt excited, thrilled when the award was announced. I was not in the race for the award. I am aware of the honor associated with the award, the prestige it has ... I will be joining an elite club of the Pravasi Bharatiya Samman awardees and meet top-level personalities from around the globe. It’s a lifetime achievement.”
Established in 2003, the annual award celebrates the exceptional contributions of overseas Indians in various fields, including medicine, community service, education, business and public affairs.
Dr. Khursheed is among 27 recipients of this year’s Pravasi Bharatiya Samman, and the only one based in Saudi Arabia. He received the award from President Droupadi Murmu.
“Dr. Syed Anwar Khursheed is a distinguished physician with 45 years of experience in public health care and is one of the longest-serving physicians in the government sector. Having spent three decades at the King Faisal Hospital, he was a part of the Medical Protocol Department of the Royal Saudi Family for eight years. He also oversaw critical care operations in the Hajj program at Minah and Arafat,” Suhel Ajaz Khan, India’s ambassador to the Kingdom, told Arab News.
“The Pravasi Bharatiya Samman Award to Dr. Syed Anwar Khursheed is a matter of great pride for the Indian diaspora in Saudi Arabia, since it is the highest honor conferred on overseas Indians by the Hon’ble President of India. The award has recognized Dr. Khursheed’s outstanding achievements in the field of medical science and health care, and his long-standing contribution to the welfare of the Indian community in Saudi Arabia.”
More than 2.65 million Indians live and work in Saudi Arabia. They constitute the second-largest Indian community in the Middle East after the UAE.
Among the previous recipients of the Pravasi Bharatiya Samman Award from Saudi Arabia are Dr. Majid Kazi, personal physician to King Fahd bin Abdulaziz, who was honored with Pravasi Bharatiya Samman in 2006, and Rafiuddin Fazulbhoy, social worker and the founder of Indian International School in Jeddah, who received it in 2008.
In 2011, the award was conferred to renowned pediatrician Dr. M.S. Karimuddin, and in 2014 to Shihab Kottukad, a social worker engaged in assisting the poorest Indian laborers in the Kingdom.
Educationist Zeenat Jafri, who started the first Indian school in Riyadh, was awarded Pravasi Bharatiya Samman in 2017. In 2021, the recognition was granted to Dr. Siddeek Ahmed, investor and philanthropist based in Saudi Arabia’s Eastern Province.
Newcastle boss Howe eager to hang onto goalkeeper Dubravka
- Newcastle manager Eddie Howe still hopes goalkeeper Martin Dubravka will stay at St. James’ Park beyond the end of the January transfer window
LONDON: Newcastle manager Eddie Howe still hopes goalkeeper Martin Dubravka will stay at St. James’ Park beyond the end of the January transfer window.
The in-form 35-year-old Slovakia international has been heavily linked with a move to Saudi Pro League side Al Shabab as he enters the final six months of his contract with the Magpies.
Dubravka has conceded just two goals in seven games in all competitions — all of them victories — while deputising for the injured Nick Pope during a run where Newcastle are closing in on a place in the English League Cup final and are fifth in the Premier League table.
“Martin’s been in a difficult situation,” Howe said Friday.
“Like any player that is coming out of contract in the summer, with every player that I’ve ever worked with, there’s always that feeling of doubt.
“He will naturally want some conclusion to his future, whether that’s a new contract with us, whatever the outcome. But he’s certainly played very well and I’ve been really pleased with him.
“He’s more than played his part in our recent run of fixtures. Again against Arsenal (a 2-0 win in the first leg of a League Cup semifinal), I thought he was very, very good, so hopefully we can come to some sort of agreement with him.”
Dubravka was seen to be in tears following the conclusion of Tuesday’s game against Arsenal, in what many observers interpreted as a farewell to Newcastle.
He was signed by former Newcastle boss Rafael Benitez, initially on loan, in January 2018, but has largely been a back-up to England international Pope for the last two-and-a-half years, a period which included a loan spell at Manchester United.
But he has shown his value in recent weeks with Howe, who must decide whether or not to rest Dubravka for Sunday’s FA Cup third-round tie against fourth-tier Bromley, saying: “I know how much Newcastle means to him and you can see that emotionally, he’s very invested.
“Of course, all those things will be playing a part in his decision-making and our decision-making and hopefully there’s a successful outcome at the end.”
Newcastle have been linked with a move for Burnley’s England under-21 international James Trafford should Dubravka move on.
And Howe refused to say whether Pope, who is back in training, remained his first-choice goalkeeper.
“It’s always in a state of flux,” he said. “It’s always changing and moving because that’s down to the player’s performances.”
Parliamentary Foreign Vice-Minister Matsumoto to visit Saudi Arabia, Jordan
TOKYO: Japan’s Parliamentary Vice-Minister for Foreign Affairs Matsumoto Hisashi will visit the Kingdom of Saudi Arabia and Jordan from Jan. 11 to 15, the foreign ministry said on Friday.
During the visit, Matsumoto is scheduled to exchange views with government officials of Saudi Arabia and Jordan on bilateral relations as well as regional and international situations.
Matsumoto is scheduled to arrive in Riyadh on Jan. 12, according to the ministry.
A version of this article appeared on Arab News Japan.
