In the news of Elon Musk is acquiring a significant stake in Twitter – and the revelation that it really works on an edit button for tweets — Many people noticed a wrinkle that seemed small at first but could cause problems later.
On Monday, Musk filed beneficial ownership filings with the Securities and Exchange Commission (SEC) to confirm his ownership of 73,486,938 Twitter shares (about 9.2 percent of the company’s outstanding common stock and enough to make him the company’s largest single shareholder to do) and ticked the boxes on the form (pdf) indicated that it is a Schedule 13G, allowing for easy disclosure for investors who intend to remain “passive” on the company’s affairs.
We don’t normally go into stock market minutiae, but this is important because of what happened next. This morning, Twitter and its CEO, Parag Agrawal, announced that Elon Musk will become a board memberand that news raised eyebrows because it suggests a much more active role that will require filing a more detailed Section 13D form on the stock purchase.
Failure to have proper disclosure could result in a fine from the SEC, and as much as Elon seems to be enjoying his ongoing feuds with federal agency (claims broken promises, accusing leaks the agency and claimed he was forced to make an unfair comparison about his tweets and citing Eminem in a court record are few), it looks like he decided to avoid it. Around the same time, the message came over the edit button, an updated submission appeared, changing the previous one, ticking the right box and avoiding an unnecessary headache for the billionaire and his new 9.2 percent toy.
Most importantly, the new form details Musk’s plans for his involvement in the company and the company as a whole. It relates to the agreement that he will not seek to own more than 14.9 percent of Twitter stock as a condition of joining the board, and that he has no plans other than potentially selling or buying shares in the company or to sell its subsidiaries. propose a merger or take other action listed under point 4 of the form. A report from The New York Times points out that unlike some other board members, Musk has not signed an agreement promising not to influence company policy.
The new file also contains significantly more detail than Monday’s form on how we got here. It shows that Musk has been buying Twitter stock on an almost daily basis since Jan. 31. He never bought less than 371,075 shares on the days he bought them, with a peak of 4,839,507 shares bought on February 7th, and the last batch on record was bought on April 1st. On April 4, Twitter announced his new role, and a day later we heard the news on the edit button (which Twitter says has been in the works for over a year and has nothing to do with a poll posted by its newest board member became ).
https://www.theverge.com/2022/4/5/23012266/elon-musk-sec-twitter-stock-acquisition-13d-tesla Elon Musk updates filings on his shocking Twitter purchase to avoid additional SEC drama