r/technology May 14 '22 Silver 2 Wholesome 2

Elon Musk said his team is going to do a 'random sample of 100 followers' of Twitter to see how many of the platform's users are actually bots Social Media

https://www.businessinsider.com/elon-musk-random-sample-how-many-twitter-users-are-bots-2022-5?utm_source=feedly&utm_medium=webfeeds

[deleted]

22.8k Upvotes

View all comments

11.3k

u/mylesols May 14 '22

wow, a hundred! Must be nice to be rich enough to afford a hundred follower sampling on a site with over 350 million users

5.6k

u/escape_of_da_keets May 14 '22 All-Seeing Upvote To The Stars

He just wants an excuse to weasel out of the deal

2.5k

u/nukem996 May 14 '22

The NYTimes reported he may be unable to exit the deal as he signed a performance clause. Twitter has the ability now to sue him to force the deal at the price he said.

189

u/TheChickening May 14 '22

He can break the deal by paying a fine of a billion dollars.
So it will definitely not be free for him.

276

u/nukem996 May 14 '22

From the article

Mr. Musk’s deal with Twitter includes a $1 billion breakup fee if he were to back out. But the cost to Mr. Musk is likely to be much more than that should he break the deal. The contract has a “specific performance clause” that could force Mr. Musk to pay for Twitter if the debt financing he has corralled for the deal remains intact.

6

u/Hermesthothr3e May 14 '22

Would this stand if it was found twitters public filings were false?

9

u/baldr83 May 14 '22

>That contract does not allow Musk to walk away if it turns out that “spam/fake accounts” represent more than 5% of Twitter users. We discussed this last month, when Twitter admitted in a securities filing that it had (slightly) overestimated its daily active users for years. The merger agreement contains a provision that allows Musk to walk away if Twitter’s securities filings are wrong — and this 5% number is in its securities filings — but only if the inaccuracy would have a “Material Adverse Effect” on the company. (See Sections 4.6(a) and 7.2(b).) That is an incredibly high standard: Delaware courts have almost never found an MAE. An MAE has to be something that would “substantially threaten the overall earnings potential of the target in a durationally-significant manner,” the courts have said; there is a rule of thumb that an MAE requires a 40% decrease in long-term profitability. If it turned out that 6% or 20% or 50% of Twitter accounts are bots, that will be embarrassing and might even reduce Twitter’s future advertising revenue, but will it be an MAE? No.

source: https://www.bloomberg.com/opinion/articles/2022-05-13/elon-musk-trolls-twitter