Tech billionaire Elon Musk has agreed to step down as chairman of the company for three years and pay a $20 million fine in a deal with the US stock market regulatory authority, Securities and Exchange Commission (SEC), to resolve securities fraud charges. Musk said that he had “funding secured” for a buyout of the electric-car company at $420 a share, reports The New York Times.

According to the SEC’s complaint, Musk’s misleading tweets caused Tesla’s stock price to jump by over six percent on August 7 and led to significant market disruption.

Tesla in recent years has become one of the most valuable American car makers, with its stock worth more than $50 billion.

But its shares have been hit hard since the SEC filed the lawsuit. On Friday, its stock dropped almost 14 percent.

Musk, a co-founder of Tesla, is the company’s largest stockholder, owning approximately 22 percent of its outstanding shares.

Under the settlement, which requires court approval, Musk will be allowed to stay as CEO but must leave his role as chairman of the board within 45 days. He cannot seek re-election for three years, according to court filings.

He accepted the deal with the SEC “without admitting or denying the allegations of the complaint”, according to a court document.

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