5 ms·

Elon Musk notifies Twitter he is terminating deal

61 points by uptown 4y ago

iamwpj 4y ago
News so apparent that no one has any care to embellish upon it.
thedailymail 4y ago
Presumably he will have to pay the $1 billion walkaway penalty. But the complete collapse of his trustability among potential business partners will cost him a lot more.
- xadhominemx 4y ago
  No, he can’t pay the termination fee. He has to close the deal.
  - freemint 4y ago
    He can't afford to close the deal either. Looks like some of his Tesla stocks will have to be liquidated.
- fooey 4y ago
  The $1b isn't a walkaway fee, it's a penalty if a 3rd party kills the deal They have a binding contract, there is no walking away without spending years in court In that contract, Musk even agrees he cannot contest Twitter forcing him to complete the purchase > it is hereby acknowledged and agreed that the Company shall be entitled to specific performance or other equitable remedy to enforce Parent and Acquisition Sub’s obligations to cause the Equity Investor to fund the Equity Financing, or to enforce the Equity Investor’s obligation to fund the Equity Financing directly, and to consummate the Closing https://www.sec.gov/Archives/edgar/data/1418091/000119312522120474/d310843ddefa14a.htm https://www.sec.gov/Archives/edgar/data/1418091/000119312522...
  - detritus 4y ago
    *squints, re-reads. Again I mean, notwithstanding the fairly arcane language - 'ouch'.
  - freemint 4y ago
    "(If) the Parent (Elon Musk) fails to consummate the Merger as required pursuant to the Merger Agreement, including because the equity, debt and/or margin loan financing is not funded, Parent will be required to pay Twitter a termination fee of $1.0 billion"
    - xadhominemx 4y ago
      Yes, basically no matter what, if for some reason the deal cannot close (eg the government blocks it) he has to pay $1b. He still must try to close the deal.
- grey-area 4y ago
  No he’ll refuse to pay that.
- thomassmith65 4y ago
  Musk's behavior increasingly suggests he has psychiatric problems. Even if there is someone around him with the guts to suggest he seek help, he probably wouldn't listen. It would be callous of me explicitly to spell it out, but, going forward, his reputation may be the least of his worries.
  - barrysteve 4y ago
    When did it become vogue to diagnose psychiatric problems from contract disputes? Even psychologists say you shouldn't do that. Psychology is the contemporary inquisitor, let it go.
    - thomassmith65 4y ago
      Fair enough: psychiatry is not a field in which I am an expert. To the extent that I have a diagnosis, it's nothing more specific than 'this behavior is starting to remind me of Elvis or Michael Jackson'
  - dang 4y ago
    Please don't do internet psychiatric diagnosis on HN. It's a marker of low-quality threads. https://hn.algolia.com/?dateRange=all&page=0&prefix=false&query=by%3Adang%20%22internet%20psychiatric%20diagnosis%22&sort=byDate&type=comment https://hn.algolia.com/?dateRange=all&page=0&prefix=false&qu...
    - thomassmith65 4y ago
      No problem, happy to oblige.
  - vt85 4y ago
    [dead]
- JamesSwift 4y ago
  As another commenter said, its not a get-out-of-jail-for-1b option. Thats a contingent on factors outside of Musks/Twitters control. Once you walk away and get into the realm of negligence it opens it up to a lot more in terms of damages.
AnimalMuppet 4y ago
Maybe (probably) I'm missing stuff, but it looks to me like Musk announced the deal, but either never had any intention of completing it, or almost immediately lost interest in completing it. So... what exactly was that all about?
- atlasunshrugged 4y ago
  Josh Wolfe (an investor with Lux Capital) has claimed it was a ruse to liquidate Tesla stock en masse without Tesla hodlers getting suspicious. https://twitter.com/wolfejosh/status/1545387947578597376 https://twitter.com/wolfejosh/status/1545387947578597376
  - AnimalMuppet 4y ago
    Interesting. A clever play, if it's true.
    - hourago 4y ago
      You misspelled fraud.
      - rnk 4y ago
        I think that's silly. He already sold tons in the last 6 months just to pay taxes. Did he sell extra?
        floatinglotus 4y ago
        Selling to pay taxes doesn’t spook investors as much as a CEO selling stock in their own company just to hold the cash.
    - selfportrait 4y ago
      Not only was it blatantly obvious from the start, but it wasn’t the first time Elon liquidated Tesla shares while misdirecting. Both his fans and the media continue to fall for his distractions to this day. https://www.wsj.com/articles/twitter-voters-back-idea-of-elon-musk-selling-10-of-his-tesla-shares-11636312972 https://www.wsj.com/articles/twitter-voters-back-idea-of-elo... https://www.autonews.com/executives/elon-musks-tweet-about-taking-tesla-private-was-false-us-judge-rules https://www.autonews.com/executives/elon-musks-tweet-about-t...
olliej 4y ago
He has been trying to produce excuses to justify this for weeks so he wouldn't have to pay the cancellation price that he agreed to. It should have been clear to everyone by now he had no attention of actually doing anything beyond getting attention.
alexk307 4y ago
The pump and dump strikes again!
isitmadeofglass 4y ago
So is this securities fraud? Also, I’m guessing if he sold any stock he’ll go down for insider trading since he knew he was going to bail right? So either he’s in for a huge loss as the sale falls through or if he sold he’s in for a huge fine right? I mean outside of the 1b penalty of cause.
vt85 4y ago

61 points by uptown 4y ago

News so apparent that no one has any care to embellish upon it.

Presumably he will have to pay the $1 billion walkaway penalty. But the complete collapse of his trustability among potential business partners will cost him a lot more.

xadhominemx 4y ago
No, he can’t pay the termination fee. He has to close the deal.
- freemint 4y ago
  He can't afford to close the deal either. Looks like some of his Tesla stocks will have to be liquidated.
fooey 4y ago
The $1b isn't a walkaway fee, it's a penalty if a 3rd party kills the deal They have a binding contract, there is no walking away without spending years in court In that contract, Musk even agrees he cannot contest Twitter forcing him to complete the purchase > it is hereby acknowledged and agreed that the Company shall be entitled to specific performance or other equitable remedy to enforce Parent and Acquisition Sub’s obligations to cause the Equity Investor to fund the Equity Financing, or to enforce the Equity Investor’s obligation to fund the Equity Financing directly, and to consummate the Closing https://www.sec.gov/Archives/edgar/data/1418091/000119312522120474/d310843ddefa14a.htm https://www.sec.gov/Archives/edgar/data/1418091/000119312522...
- detritus 4y ago
  *squints, re-reads. Again I mean, notwithstanding the fairly arcane language - 'ouch'.
- freemint 4y ago
  "(If) the Parent (Elon Musk) fails to consummate the Merger as required pursuant to the Merger Agreement, including because the equity, debt and/or margin loan financing is not funded, Parent will be required to pay Twitter a termination fee of $1.0 billion"
  - xadhominemx 4y ago
    Yes, basically no matter what, if for some reason the deal cannot close (eg the government blocks it) he has to pay $1b. He still must try to close the deal.
grey-area 4y ago
No he’ll refuse to pay that.
thomassmith65 4y ago
Musk's behavior increasingly suggests he has psychiatric problems. Even if there is someone around him with the guts to suggest he seek help, he probably wouldn't listen. It would be callous of me explicitly to spell it out, but, going forward, his reputation may be the least of his worries.
- barrysteve 4y ago
  When did it become vogue to diagnose psychiatric problems from contract disputes? Even psychologists say you shouldn't do that. Psychology is the contemporary inquisitor, let it go.
  - thomassmith65 4y ago
    Fair enough: psychiatry is not a field in which I am an expert. To the extent that I have a diagnosis, it's nothing more specific than 'this behavior is starting to remind me of Elvis or Michael Jackson'
- dang 4y ago
  Please don't do internet psychiatric diagnosis on HN. It's a marker of low-quality threads. https://hn.algolia.com/?dateRange=all&page=0&prefix=false&query=by%3Adang%20%22internet%20psychiatric%20diagnosis%22&sort=byDate&type=comment https://hn.algolia.com/?dateRange=all&page=0&prefix=false&qu...
  - thomassmith65 4y ago
    No problem, happy to oblige.
- vt85 4y ago
  [dead]
JamesSwift 4y ago
As another commenter said, its not a get-out-of-jail-for-1b option. Thats a contingent on factors outside of Musks/Twitters control. Once you walk away and get into the realm of negligence it opens it up to a lot more in terms of damages.

AnimalMuppet 4y ago

Maybe (probably) I'm missing stuff, but it looks to me like Musk announced the deal, but either never had any intention of completing it, or almost immediately lost interest in completing it. So... what exactly was that all about?

atlasunshrugged 4y ago
Josh Wolfe (an investor with Lux Capital) has claimed it was a ruse to liquidate Tesla stock en masse without Tesla hodlers getting suspicious. https://twitter.com/wolfejosh/status/1545387947578597376 https://twitter.com/wolfejosh/status/1545387947578597376
- AnimalMuppet 4y ago
  Interesting. A clever play, if it's true.
  - hourago 4y ago
    You misspelled fraud.
    - rnk 4y ago
      I think that's silly. He already sold tons in the last 6 months just to pay taxes. Did he sell extra?
      - floatinglotus 4y ago
        Selling to pay taxes doesn’t spook investors as much as a CEO selling stock in their own company just to hold the cash.
  - selfportrait 4y ago
    Not only was it blatantly obvious from the start, but it wasn’t the first time Elon liquidated Tesla shares while misdirecting. Both his fans and the media continue to fall for his distractions to this day. https://www.wsj.com/articles/twitter-voters-back-idea-of-elon-musk-selling-10-of-his-tesla-shares-11636312972 https://www.wsj.com/articles/twitter-voters-back-idea-of-elo... https://www.autonews.com/executives/elon-musks-tweet-about-taking-tesla-private-was-false-us-judge-rules https://www.autonews.com/executives/elon-musks-tweet-about-t...

olliej 4y ago

He has been trying to produce excuses to justify this for weeks so he wouldn't have to pay the cancellation price that he agreed to. It should have been clear to everyone by now he had no attention of actually doing anything beyond getting attention.

alexk307 4y ago

The pump and dump strikes again!

isitmadeofglass 4y ago

So is this securities fraud? Also, I’m guessing if he sold any stock he’ll go down for insider trading since he knew he was going to bail right? So either he’s in for a huge loss as the sale falls through or if he sold he’s in for a huge fine right? I mean outside of the 1b penalty of cause.

vt85 4y ago