Elon Musk may soon be out as chairman of Tesla, but he’ll be able to pick his successor and serve with that person on the electric car company’s board.
The settlement agreements Musk and Tesla reached with the Securities and Exchange Commission don’t include any kind of bar on Musk’s continued service as a director of the car company. The agreements, copies of which Business Insider obtained from the Securities and Exchange Commission on Wednesday, also do not include any provision that would bar him from voting his shares in favor of or against nominees to the Tesla’s board.
That means that despite being forced to step down as chairman as part of those agreements, Musk could continue to have a lot of sway over the body that is supposed to oversee him as CEO. Musk is Tesla’s largest shareholder, holding some 22% of the company’s outstanding shares at the end of last year.
“Musk is still the CEO and his friends still control the board, so tell me what really changed,” said Lynn Turner, a former chief accountant of the Securities and Exchange Commission.
The settlements were related to Musk’s infamous “funding secured” tweets regarding a potential move to take Tesla public. The SEC charged that he made those statements on Twitter knowing or having reason to know that they were false and misleading. After Musk initially rejected a settlement offer from the agency, which the SEC responded to by suing him, Tesla and its CEO accepted revised settlement agreements that are somewhat harsher.