Tesla will miss Musk as Chairman for the next three years

Tesla’s Elon Musk will soon step down as Chairman of the electric carmaker under a settlement agreed with U.S. Securities and Exchange Commission. Musk will remain CEO of Tesla and will also pay a fine of $20 million as per the agreement which was filed Saturday.

The U.S SEC deal would require Musk to refrain from seeking reelection or accepting an appointment as Chairman for the next three years. Also, Musk need not accept allegations made by the SEC, as per the agreement. The SEC fined Tesla with a whopping $20 million for failing to require disclosure controls and procedures relating to Musk’s infamous announcement on a popular social networking site, in August.

Tesla, on the other hand, is making some necessary changes, according to the SEC. Tesla will appoint two new independent directors to its board and put in place additional controls and procedures to oversee Musk’s communication – most importantly his tweets about Tesla.

Steven Peikin, Co-Director of SEC’s Enforcement Division said, “The resolution is intended to prevent further market disruption and harm to Tesla’s shareholders,” talking about the agreement that prevented everyone, including Musk, from facing a bitter and potentially damaging fight.

The SEC filed a complaint against the entrepreneur billionaire last Thursday in Federal District Court. The complaint alleged that Musk violated anti-fraud provisions of the federal securities law, which he describes as an “unjustified action that has left him deeply saddened and disappointed.”