I'm still convinced he's just gonna use it to suggest that a judge should meet him in the middle; make him buy the company, but use the allegations of large numbers of bots to reduce the price.
I think a judge would either order specific performance (e.g. do the thing the contract says, as specified in the contract), or we’re talking about damages (e.g. pay Twitter $X, but you don’t get anything in return).
I think a purchase at a lower price would probably only come from a settlement between the parties, and… I think that’s likely. Twitter didn’t want to be purchased in the first place, and now has Musk over a barrel. I think Twitter is going to use the threat of specific performance to try and extract a damages settlement greater than the contractual $1B from Musk.
The accelerated trial date put Musk on notice. The SEC may not take enforcing the rules seriously, but Delaware has made it their business to enforce the rules that make it attractive for big corps to incorporate under. I don't think this makes it to trial where Musk will get destroyed, and bet they end up settling in the ~10B range.
It's only fair for mullosk to be on the hook for the full purchase or at the very least the full differential.
We'll see what happens in about two months.
Or he vets out of the deal, has to pay billions for nothing and still looks like a bad business man.
Since all his wealth is based on Tesla, and more specifically on Tesla's public perception as tech company and not a car maker, all of which in turn is based to significant extent on yhe public's perception of Musk as a genius, this change in public perception is incredibly dangerous for Musk.
Musk already looked like a corporate bottomfeeder to anyone who was actually paying attention to his behavior.
You're right, though. Obviously, other facets of this situation were going to affect Tesla, but I hadn't really thought about the effects on Musk's reputation could impact his companies' share prices. TSLA is as much a cult of personality as it is a stock.
Yeah that's what makes the most sense. Musk doesn't want to buy Twitter anymore, forcing him to buy it is not a very good solution. It's possible to do, and certainly enforceable, but not a desirable outcome for anyone.
But, having him pay $10 or even $15 billions as a price to renege on his word, on the contrary, is an excellent outcome.
Similarly, if the fine is smaller, Twitter share-holders would be better off just forcing him to buy and forgoing the fine.
So a settlement number seems kinda hard to agree on, unless they have differing opinions on what the company is currently worth.
A fine close to the spread, but still a bit lower, accounts for that.
Not necessarily. There's a world where Musk really can't get the financing together, and stumping up the $44B in cash is too much of a hurdle to be worth-while.
Imagine, you could either pay $1,000 as a fine, or spend $10,000 on a car that you're pretty sure you could sell for $9,200. Obviously, in absolute terms you're better off buying and selling the car. But if you only have $5,000, it might not be worth the hassle to raise the other $5,000 to be able to buy then sell the car. Not to mention the risk that once you get the car, and go to sell it, there's a chance it only sells for $8,800.
It comes down to anti slavery laws
so probably not enforceable, though he could be fined.
https://www.barrons.com/articles/twitter-elon-musk-thirteent...
So, it’s like the thin shell company has agreed to the deal, and Elon Musk has personally guaranteed the financing.
Which means the only specific performance the judge would be mandating from Elon Musk personally would be financial payments. The actual purchasing and paperwork would be done by the shell corporation. The only thing Elon Musk would be ordered to do in his personal capacity would be to write a large check (which, seems to be well within the remit of a judge’s authority over a person without raising 13a concerns).
Like, I agree that ordering specific performance for painting someone’s house is a bit odd and might raise those questions. But, Elon Musk’s only requirement as an individual under this contract is to write a check.
To be honest, I’m pretty skeptical of the analysis of the article you cited. The article says: “ Unfortunately for Twitter, it isn’t Elon Musk Inc. but Elon Musk the individual who offered to buy the company” which is wrong.
It literally is Elon Musk Inc. which is offering to buy twitter (technically X Holdings I, Inc.). See the merger agreement here: https://www.sec.gov/Archives/edgar/data/1418091/000119312522...
Since that point underlies the entire analysis, it seems… very suspect to me to get that exactly wrong.
Short term he would fork out a lot more money, but long term he has a company that can grow...
My opinion is this is just a stalling tactic, he thinks the market will recover by next year and this is a pretext to wait until then.