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"For so long as Mr. Musk is serving on the Board and for 90 days thereafter, Mr. Musk will not, either alone or as a member of a group, become the beneficial ow
by throwaway5752 5y ago
"For so long as Mr. Musk is serving on the Board and for 90 days thereafter, Mr. Musk will not, either alone or as a member of a group, become the beneficial owner of more than 14.9% of the Company’s common stock outstanding at such time, including for these purposes economic exposure through derivative securities, swaps, or hedging transactions."
This is the second line in the linked filing, and something a number of people have not read.
- prvc 5y agoWhat is the maximum number of seats he could control under those conditions?
- eganist 5y ago> This is the second line in the linked filing, and something a number of people have not read. Not sure it's that it was left unread or if it just doesn't matter. As best as I can tell, it just means he won't overtly threaten the company with a takeover or equivalent because he's been given soft power to influence. My lay reading suggests that Twitter is now basically operating at his whims to keep him from leaving the board and executing a takeover plan 90 days thereafter.
- sandworm101 5y ago>> he won't overtly threaten the company with a takeover or equivalent Well, he can overtly threaten all he wants. He can begin the process. He can make all the money arrangements and make agreements with other shareholders. He just cannot complete the takeover by actually acquiring more stock (or other instruments) until after 90 days. Imho that isn't a practical limit on threats.
- mywittyname 5y ago> My lay reading suggests that Twitter is now basically operating at his whims to keep him from leaving the board and executing a takeover plan 90 days thereafter. Honestly, it might be amusing if he does do that. Twitter stock looks to still flat from the IPO price, even after the spike after this announcement. I say, let him tie up a significant portion of his net worth in a vanity project with no real growth potential.
- k__ 5y agolol, what's the meaning of that? So he doesn't down the stock with his decisions and buys it cheap later?
- singlow 5y agoOK, Elon, lets settle. Let's give you a board seat but you have to promise not to try and buy up controlling shares in the company and privatize it in a hostile takeover.
- k__ 5y agoSo, they really think he could improve the value of their shares?
- singlow 5y agoI really don't understand how you pull that from my comment. They are trying to avert a hostile takeover. Elon may not even be interested in making twitter more profitable. It may just be a pet project for him to take over the company and shutter it out of spite or use it to further some other goals. They gave him a board seat to try to get him to back off.
- paxys 5y agoI'm not sure I understand. What is the relevance of this line?
- divbzero 5y agoThe board seat was granted in tandem with a guarantee from Musk that he will limit the number of voting shares he amasses. I don’t think it’s an uncommon arrangement when an outside investor joins the board.
- paxys 5y agoIt's a standard clause for anyone getting into any relationship with a company. Your own employee agreement probably has a similar one. Ultimately if he does want to buy more he can resign from the board with one Tweet.
- topspin 5y agoSomeone fill me in here: TWTR is a NYSE traded stock. What, hypothetically, would prevent someone from just paying the market price for whatever percent of Twitter's stock they care to buy, such that they would have to agree to these terms?
- ChadNauseam 5y agoAbsolutely nothing, although when management is opposed to the takeover they have techniques to make it very costly for the attacker. In this case, the requirements are conditions for a seat on the board – if Elon wanted, he could resign and buy as much stock as he pleases.
- saulpw 5y agohttps://en.wikipedia.org/wiki/Takeover#Hostile https://en.wikipedia.org/wiki/Takeover#Hostile