On Saturday, it was initially reported that Elon Musk had refuted the deal offered to him by the Securities and Exchange Commission. However, on Sunday, it was announced that the Tesla co-founder and chief executive had decided to settle terms with the SEC.
Accordingly, Musk will be vacating his post as the company chairman. In addition, Musk will also be paying a fine of $20 million. Tesla will also be paying a penalty of $20 million to the SEC. The SEC has granted a time-limit of 45 days for Musk to step down as the company chairman.
He will, however, stay on as the company CEO. Musk has also been directed to be compliant with Tesla's communications policies hereon when it came to sharing information on Twitter. Following Musk's stepping aside as Tesla's chair, a new chairman will be appointed – who will be independent – to oversee the working of the company's board of directors.
Speaking after the agreement had been reached between the SEC and Musk, the SEC chair Jay Clayton shared, "This matter reaffirms an important principle embodied in our disclosure-based federal securities laws. Specifically, when companies and corporate insiders make statements, they must act responsibly, including endeavouring to ensure the statements are not false or misleading and do not omit information a reasonable investor would consider important in making an investment decision." Musk had encountered problems after he tweeted about making Tesla private on 7th August.