Just a day after popular Tesla CEO Elon Musk bought 9.2% of Twitter, the popular microblogging site is set to appoint him to its board of directors, according to a filing with the Securities and Exchange Commission.
Musk will serve as a Class II director until 2024. According to sources, this is a type of position that can be used as an anti-takeover measure.
“The Company will appoint Mr. Musk to the Company’s Board of Directors (the “Board”) to serve as a Class II director with a term expiring at the Company’s 2024 Annual Meeting of Stockholders,” the filing says. “For so long as Mr. Musk is serving on the Board and for 90 days thereafter, Mr. Musk will not, either alone or as a member of a group, become the beneficial owner of more than 14.9% of the Company’s common stock outstanding at such time, including for these purposes economic exposure through derivative securities, swaps, or hedging transactions.”
“Through conversations with Elon in recent weeks, it became clear to us that he would bring great value to our Board,” CEO Parag Agrawal said in a tweet.
“He’s both a passionate believer and intense critic of the service which is exactly what we need on Twitter, and in the boardroom, to make us stronger in the long-term,” he added.
More details show that Elon Musk cannot be the beneficial owner of more than 14.9% of the company’s common stock during his entire board term or 90 days after.
“Looking forward to working with Parag & Twitter board to make significant improvements to Twitter in coming months!” Musk said in a tweet.