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On Thursday, negotiations between Twitter and Elon Musk reached a stalemate, with the tech giant remaining steadfast in its insistence that a trial be held before close to ensure Musk is able to pay up. Musk and Twitter agreed to a deal where Musk would buy the social media giant for $54.20 per share, or $44 billion.
Musk’s lawyers petitioned the court to stay the trial, pointing out that the billionaire and his financiers had promised to come up with the money in time. Their wish was granted.
Delaware Court of Chancery Chancellor Kathaleen St. Jude McCormick wrote in her decision that the trial would be “stayed until 5 p.m. on October 28, 2022, to permit the parties to close on the transaction.”
“If the transaction does not close by 5 p.m. on October 28, 2022,” she warned, “the parties are instructed to contact me by email that evening to obtain November 2022 trial dates.”
According to Bloomberg, Musk proposed adding a line that made the deal contingent on financing, however Twitter refused, as it was not in the original agreement. Musk made the buyout offer in the spring, insisting that the platform had to be run on principles of free speech and transparency.
In their petition, Musk's lawyers argued that Twitter was being unreasonable in their insistance that a trial be held.
"This Court ordered an expedited trial on Twitter’s sole equitable claim for relief that Defendants 'specifically perform their obligations under the merger agreement and consummate the closing in accordance with the terms of the merger agreement'," they wrote, adding that Musk has "agreed to do exactly that," with debt financing parties "working cooperatively to fund the close."
"As a result there is no need for an expedited trial to order Defendants to do what they are already doing and this action is now moot," they continued, citing a previous ruling that read, "Delaware courts do not address 'disagreements that have no significant current impact'."
"Proceeding with the trial is not only an enormous waste of party and judicial resources," Musk's lawyers added, "it will undermine the ability of the parties to close the transaction." They also cited the negative impact it would have on shareholders and the economy.
Twitter has not yet responded publicly to the court's staying of their requested trial.
Musk’s lawyers petitioned the court to stay the trial, pointing out that the billionaire and his financiers had promised to come up with the money in time. Their wish was granted.
Delaware Court of Chancery Chancellor Kathaleen St. Jude McCormick wrote in her decision that the trial would be “stayed until 5 p.m. on October 28, 2022, to permit the parties to close on the transaction.”
“If the transaction does not close by 5 p.m. on October 28, 2022,” she warned, “the parties are instructed to contact me by email that evening to obtain November 2022 trial dates.”
According to Bloomberg, Musk proposed adding a line that made the deal contingent on financing, however Twitter refused, as it was not in the original agreement. Musk made the buyout offer in the spring, insisting that the platform had to be run on principles of free speech and transparency.
In their petition, Musk's lawyers argued that Twitter was being unreasonable in their insistance that a trial be held.
"This Court ordered an expedited trial on Twitter’s sole equitable claim for relief that Defendants 'specifically perform their obligations under the merger agreement and consummate the closing in accordance with the terms of the merger agreement'," they wrote, adding that Musk has "agreed to do exactly that," with debt financing parties "working cooperatively to fund the close."
"As a result there is no need for an expedited trial to order Defendants to do what they are already doing and this action is now moot," they continued, citing a previous ruling that read, "Delaware courts do not address 'disagreements that have no significant current impact'."
"Proceeding with the trial is not only an enormous waste of party and judicial resources," Musk's lawyers added, "it will undermine the ability of the parties to close the transaction." They also cited the negative impact it would have on shareholders and the economy.
Twitter has not yet responded publicly to the court's staying of their requested trial.
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