Tesla Inc. has expanded its board by bringing on Larry Ellison and Walgreens Boots Alliance Inc. executive Kathleen Wilson-Thompson as independent directors.
The appointments, announced today, fulfill one of the carmaker’s biggest obligations under its September settlement with the Securities and Exchange Commission. That deal ended a lawsuit brought by the SEC over a now-infamous tweet from Tesla Chief Executive Elon Musk. On Aug. 7, the billionaire entrepreneur tweeted that he had secured funding to take Tesla private at a price of $420 per share.
In addition to the appointment of two outside directors, the settlement mandated that Musk relinquish the role of chairman. Australian telecommunications executive and existing Tesla board member Robyn Denholm took over the position last month.
The terms of the settlement reportedly ended up being harsher than they could’ve been. The SEC is said to have originally proposed a settlement that would have barred Musk from being re-elected as chairman for two years, but bumped it up to three years in response to the CEO’s provocative response. On top of the board changes, the final deal also required Musk and Tesla each to pay a $20 million fine.
Even though Musk is no longer chairman, he continues to enjoy strong support from the board of directors. That isn’t likely to change in the wake of today’s appointments.
Earlier this year, Larry Ellison bought 3 million shares in Tesla that are worth about $1 billion at Tesla’s current stock price. The Oracle Corp. founder went as far as calling Musk a close friend during a call with Wall Street analysts two months ago.
“It is one of the second largest investment which I ever make, I will disclose it now, I am not sure people know I am very close friends to Elon Musk and I am a very big investor in its company Tesla,” According to the report said in an investor Ellison as saying at the time.
The appointment of Kathleen Wilson-Thompson to the board is also being hailed as win by Tesla. She’s the executive vice president and global chief human resources officer at Walgreens, which ranks as the largest drugstore chain in the U.S. with more than 350,000 employees. Wilson-Thompson previously spent 17 years at Kellogg Co. in various leadership roles.
“In conducting a widespread search over the last few months, we sought to add independent directors with skills that would complement the current board’s experience,” Tesla’s board explained in a statement.
The new appointments more or less close the chapter on Tesla’s run-in with the SEC, but the company’s legal troubles may not be over. The Department of Justice is reportedly investigating whether the automaker misstated the pace of Model 3 production earlier this year and whether it deceived shareholders by doing so.