Twitter slams Musk's move to end acquisition deal as 'invalid and wrongful' in legal filing
Twitter has stated that it intends to follow through with the purchase even though Musk has declared his intent to back out
Experts agree Elon Musk will not buy Twitter
Neuberger Berman senior research analyst Daniel Flax and Barron's senior special writer Allen Root discuss the saga between the billionaire entrepreneur and the Big Tech platform on 'The Claman Countdown.'
Lawyers representing Twitter condemned Tesla CEO Elon Musk and his parties' "purported termination" of the $44 billion deal to acquire the social media platform as "invalid and wrongful" in a legal filing with the Securities and Exchange Commission (SEC).
Musk's legal representatives had previously sent Twitter a letter claiming that the social media company breached its obligations under the buyout deal. Musk's team has raised concerns with "spam bots" on the platform, and the Tesla CEO has threatened to walk away from the deal if the company fails to show that less than 5% of its daily active users are automated spam accounts.
"Mr. Musk’s and the other Musk Parties’ purported termination is invalid and wrongful, and it constitutes a repudiation of their obligations under the Agreement," the document, which the law firm Wachtell, Lipton, Rosen & Katz LLP filed with the SEC on Twitter's behalf, states. "Contrary to the assertions in your letter, Twitter has breached none of its obligations under the Agreement, and Twitter has not suffered and is not likely to suffer a Company Material Adverse Effect."
"The purported termination is invalid for the independent reason that Mr. Musk and the other Musk Parties have knowingly, intentionally, willfully, and materially breached the Agreement, including but not limited to Sections 6.3, 6.8, and 6.10 thereof," the letter adds.
ELON MUSK RESPONDS WITH LAUGHING MEME TO TWITTER LAWSUIT OVER BROKEN BUYOUT
2022/04/28: In this photo illustration, a Twitter logo seen displayed on a smartphone screen. (Photo Illustration by Sheldon Cooper/SOPA Images/LightRocket via Getty Images / Getty Images)
The Twitter letter responded to a letter from Musk's attorneys Friday in which the Tesla CEO's team claimed Twitter "made false and misleading representations" when Musk agreed to buy the company on April 25 and has "breached" multiple provisions of the initial agreement.
"The Agreement is not terminated, the Bank Debt Commitment Letter and the Equity Commitment Letter remain in effect, and Twitter demands that Mr. Musk and the other Musk Parties comply with their obligations under the Agreement," the Twitter letter states. "As it has done, Twitter will continue to provide information reasonably requested by Mr. Musk under the Agreement and to diligently take all measures required to close the transaction."
"Twitter reserves all contractual, legal, and other rights, including its right to specifically enforce the Musk Parties’ obligations under the Agreement," the letter concluded.
The login/sign up screen for a Twitter account is seen on a laptop computer Tuesday, April 27, 2021, in Orlando, Fla. (AP Photo/John Raoux, File / AP Newsroom)
Twitter's SEC filing included a Friday press release from Twitter, in which the company's board stated its intent to close the transaction with Musk at a $54.20 per-share price.
"We are committed to closing the transaction on the price and terms agreed upon with Mr. Musk and plan to pursue legal action to enforce the merger agreement," the release stated. "We are confident we will prevail in the Delaware Court of Chancery."
In the wee hours of Monday morning, Musk responded to Twitter's decision to hire the law firm in its response to his withdrawal from the deal.
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Musk tweeted a series of four photos of himself laughing with captions that read: "They said I couldn’t buy Twitter; Then they wouldn’t disclose bot info; Now they want to force me to buy Twitter in court; Now they have to disclose bot info in court."
Moments later, Musk tweeted another meme featuring Chuck Norris playing chess. "Chuckmate," Musk added.