Monday morning, Tesla shares experienced a very powerful relief rally.
They raised more than 15% after Elon Musk reached a settlement with the SEC of fraud charges against him.
This was a relief after the crisis that seemed to be brewing at Tesla.
It all began - and in fact, it was Mr. Musk’s own self-induced crisis, beginning with his tweets in early August,
where he said that he was close to a buyout and that he had funding already secured.
Those claims turned out not to be true, and they ultimately led, late last week, to the SEC filing charges against him
and asking a court to have him removed completely from Tesla.
So the settlement that Mr. Musk has come up with is certainly a relief for investors.
He’s agreed to step down as chairman for three years.
Tesla will appoint two new independent directors to its board,
and Musk has said he won’t tweet again about the company unless he’s had his tweets approved.
However, all of this is great news for him and probably won’t change the way he operates in any material way.
Most experts in corporate governance looking at these terms have concluded that really it leaves them a free hand.
He’s still chief executive. He still has 22% of the company. He’ll have a say in who becomes chairman.
And really, Tesla is still the Elon Musk Show.