In this photo illustration Elon Musk Twitter seen displayed on a smartphone screen with Twitter logo in the background in Chania, Crete Island, Greece on April 23, 2022.
Nikolas Kokovlis | Nurphoto | Getty Images
Elon Musk, CEO of SpaceX and Tesla, could be required to pay Twitter a termination fee of $1 billion, under some circumstances, such as if Musk fails to secure enough debt funding to complete his $44 billion deal to buy the company, according to a new SEC filing.
The deal is slated to close by Oct. 24, but could be delayed for up to six months for antitrust clearance or other reasons.
From the filing (Parent refers to the special corporation Musk created to buy Twitter):
As described above, if the conditions to Parent’s and Acquisition Sub’s obligations to complete the Merger are satisfied and Parent 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.
On the other hand, Twitter will owe Elon Musk a $1 billion break-up fee should it fall through because it found a competing offer or if shareholders reject the deal according to the same filing.
Musk offered to buy the company at $54.20 per share and take it private. He’s said Twitter should operate as a digital public square that is tolerant of different viewpoints.
In the filing on Tuesday,
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