Ellis has been coach of the Panthers for two years
Nottingham Panthers defenseman Corey Neilson is to replace Mike Ellis as head coach of the Elite League side.
Ellis had been in negotiations with the Panthers about extending his two-year spell at the National Ice Centre, but those talks broke down.
Panthers owner Neil Black turned to Neilson, 31, who was also assistant player-coach for the last two seasons.
Black told BBC Radio Nottingham: "We were at an impasse with Mike and moved swiftly to replace him."
Ellis was popular among Panthers fans and, although he did not manage to challenge for success in the Elite League, he won the play-offs in 2007 and last season's Challenge Cup.
But Black feels he had to act when discussions over a new contract stalled.
"Talks were fairly positive," Black explained. "But obviously it was a fluid situation and, as soon as it became clear to me that things were not going anywhere, we had to move."
I am not suggesting Corry is going to win us the league but, if we can do well in one or two of the cups, that would be brilliant
Neilson has not worked as a head coach before but Black is certain he will prove to be a successful appointment.
"Corey is a true professional, and an excellent person to lead this club forward," Black stated.
"Anyone who knows Corey and has seen the way he plays, and the way he conducts himself on and off the ice, knows he is a true professional character.
"He has got extensive contacts in North America and I think he was very keen to step up to the plate.
"For the sort of league we are in, one of the key requirements for us to get success is recruitment and I think in that regard Corey is exceedingly well placed to bring a lot of fresh exciting players into this club and also keep the top players we had last season.
"What I would say to the fans is that all I want, and I am sure the fans want too, is for us to be playing a certain kind of hockey - entertaining the fans and hopefully being up there challenging.
We need to bring back the players who have excited the fans over the last couple of years and bring in some new blood too
"I am not suggesting he is going to win us the league but, if we can do well in one or two of the cups, that would be brilliant."
"There could have been other names in the frame but in Corey we had an excellent candidate and I was quite keen to have someone who has some knowledge of our organisation and have a little bit of understanding about the sort of game played here in Britain too.
"We never went out there to announce there was a vacancy because there was only ever really one person in my mind who I wanted to continue to be our coach and that was Corey."
Neilson is already planning to add to the Panthers squad and says his priority is to secure players for next season.
"I have only got good things to say about Mike but when I found out the job wasn't going to be his for this year then I was more than willing to step up - it is a great opportunity for me," Neilson said.
"We need to bring back the players who have excited the fans over the last couple of years and bring in some new blood too - those are the things I am working on.
"I have already spoken to a couple of resources who say they are more than happy to help me out with my recruiting.
"I have been working with the hockey database, searching for players I have known in the past and also those I have been keeping track of over the years.
"Now it is just a case of getting them to agree to come to Nottingham."