Musk, who is also the CEO of electric car maker Tesla Inc., proposed on Twitter late Monday to change course and stick to his agreement in April to buy the company for $54.20 per share if Twitter drops litigation against him.
Musk’s proposal on Monday included a condition that closing the deal would be pending receipt of the necessary debt financing. The source, who asked not to be named, said the potential agreement would likely remove this requirement.
Twitter’s legal team and Musk’s lawyers briefed the judge on Tuesday about their attempts to try to overcome mutual distrust and find a process to close the deal.
Musk is scheduled to be deposed Thursday in Austin, Texas.
Musk rescinded his testimony in late September, citing concerns about a Twitter lawyer’s potential exposure to someone who later tested positive for COVID-19, according to a court filing published Wednesday.
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Twitter shares fell 0.7% to $51.63 Wednesday afternoon. The stock on Tuesday reached its highest level since Musk and Twitter agreed in April that he would buy the company for $54.20 per share.
Musk said in July that he was abandoning the takeover agreement because he discovered Twitter had misled him about the number of fake accounts, among other allegations.
Part of Musk’s case was based on allegations posted by whistleblower on Twitter, Peter “Mudge” Zatko, which were made public in August.
Twitter’s legal team wanted to investigate whether Quinn Emmanuel’s attorney Alex Spiro, who led Musk’s case, had contact with the whistleblower as early as May. The law firm said in court filings that its attorneys had not contacted Zatko or his representatives.
Spiro did not immediately respond to a request for comment.
Twitter disclosed an anonymous May 6 email to Spiro from “a former Twitter CEO who leads teams directly involving trust and security/content oversight,” according to court documents. The sender offered to communicate “by alternative means”.
Zatko, who was Twitter’s head of security until his dismissal in January, said under oath that he had not contacted Musk or Musk’s lawyers at Quinn Emmanuel.
The judge, Counsel Kathleen McCormick of Delaware County Courthouse, said in a ruling issued Monday that it was “reasonable at least” that Zatko sent an anonymous email. Spiro was ordered to file a statement by 4:30 p.m. EDT Wednesday to the court explaining his actions in connection with the May 6 email.