Elon Musk steps down as Tesla Chairman after Controversial Tweet

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The SEC alleged in a lawsuit on Thursday that the tweets about financing for a go-private plan he abandoned just weeks later had no basis in fact, and said the market chaos that ensued hurt investors.

Tesla shares sank last week after the SEC accused Mr Musk of securities fraud, opening up the prospect of a long-drawn out fight that could have seen Tesla lose its leader, undermine its ability to raise capital and cripple operations.

Tesla in recent years has become one of the most valuable American vehicle maker, with its stock worth more than $50 billion. Tesla shares plummeted 14% on Friday, the biggest drop in nearly five years.

The Model 3 is seen by analysts as crucial to the carmaker's long-term prospects and Musk has promised the ramp-up will help make the company profitable in the third quarter.

In the Chicago suburb of Highland Park, more than 75 people crammed into Tesla's service center and another 50 or so waited outside. The one in Brooklyn, for example, was quiet Saturday morning.

Tesla stock (NASDAQ:TSLA) is exhibiting a strong recovery on Monday, trading up 15.40% at $305.54 per share during the opening bell.

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Others were so busy that volunteers showed up to help staff out. Andrew Doane, who has a Model S sedan, Model X crossover and Model 3 vehicle and is president of the Tesla Owners Club of the Mid-Atlantic region, mustered club members to pull shifts at delivery hubs in Virginia and Maryland, and worked one himself. Tesla's Denver drivers' club president Sean Mitchell said on Twitter that a team of "30 volunteers were providing 40 [plus] hours helping deliver and teach new owners" about the cars' different features.

Under terms of the agreement, Musk also must give up his seat as chairman of the board of directors for at least three years.

"The resolution is meant to prevent further market disruption and harm to Tesla's shareholders", Peikin added.

Two "independent directors" will also be appointed by Tesla, and the company will set up a new committee of independent directors and "put in place additional controls and procedures to oversee Musk's communications", the SEC said.

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.

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