Musk Sees "Victory" Tuesday, SEC Deal: Tesla Jumps

Elon Musk to Resign as Chair of Tesla Board but Remain CEO

Tesla shares are expected to rebound today after Elon Musk was forced to stand down as chairman in a boardroom shake-up at the electric carmaker.

On Saturday, Musk settled the charges with the SEC, agreeing to pay a fine of $20 million and step down as chairman of the board for at least three years.

They also hoped the row would cap several months of volatility around Tesla's shares driven in part by a series of rows over Musk's tweets and public pronouncements. The shares closed at $307.52 Thursday before the SEC announced its enforcement action over the tweets, in which Musk said he had "funding secured" to take the company private at $420 a share. But it quickly became clear that Musk's funding commitment-supposedly from Saudi Arabia's sovereign wealth fund-was informal at best.

Ivan Feinseth of Tigress Financial Partners, also a Tesla analyst, called the settlement "an incredibly beneficial outcome for the company", adding that while he remains neutral on the stock, he would be a buyer in the $255-$275 price range.

As part of the settlement, the company will appoint a new independent chairman, two independent directors and control Musk's communications.

With Kavanaugh nomination, Trump faces #MeToo
The Judiciary Committee plans to hear from Christine Blasey Ford , who has accused Kavanaugh of a sexual assault while in high school.

"We view Elon Musk and Tesla's settlement with the SEC as a positive change, as it should improve corporate governance and allow (an) investor focus squarely on operations", Canaccord Genuity analyst Jed Dorsheimer said.

"The total package of remedies and relief announced today are specifically created to address the misconduct at issue by strengthening Tesla's corporate governance and oversight in order to protect investors", said Stephanie Avakian, co-director of the SEC's Enforcement Division.

However, Musk has agreed to a condition where he will not admit nor deny if he was guilty of committing the securities fraud. Tesla shares plummeted 14% on Friday, the biggest drop in nearly five years.

After filing the lawsuit, SEC officials were anticipating a drawn-out legal battle, but settlement talks started up again late Friday after Musk's attorney Steven Farina sent an email asking to reopen the discussions. Some analysts had said that Musk's departure would harm Tesla's brand, fundraising abilities and stakeholders' confidence if the company lost its key visionary.

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