Twitter has set a Sept. 13 date for a special meeting of shareholders to vote on its sale to Elon Musk. It’s the month before a trial set for October in Delaware Chancery Court where the social media company hopes to force the billionaire Tesla founder to actually follow through with his $44 billion purchase agreement.
The meeting is set for 10 am PT and stockholders can vote online to greenlight the merger. The two sides struck the tortured all-cash deal on April 25. Musk lined up financing, but appeared to start waffling shortly after, demanding information on bot, or spam, accounts. In July, his attorneys informed Twitter that he was formally terminating the agreement.
Twitter sued in Chancery Court, asking for a speedy September trial. The Musk camp asked the judge to put the proceeding off until February. At a hearing last week, she tilted to Twitter’s side, agreeing with the company that delay and uncertainty would continue to damage its business.
In an SEC filing, Twitter recommended stock holders vote in favor of the merger and for “compensation that will or may become payable by Twitter to its named executive officers” in connection with the merger. That is, if Twitter terminates them for a reason other than “cause, death or disability,” execs are entitled to a lump sum payment equal to 100% of base salary, and accelerated vesting of unvested equity awards.
“If the merger is completed,” noted, “you will be entitled to receive $54.20 in cash, without interest and subject to any applicable withholding taxes, for each share of our common stock that you own.” That’s a premium of 38% to Twitter’s closing share price on April 1 – the last full trading day before Musk disclosed his 9% stake. He first planned to join the board, then abruptly decided to buy the company and take it private instead. Soon after the deal was announced, a broad market downturn began to batter the shares. It’s rallied recently, closing Tuesday at $38.34.