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Elon Musk fired four senior Twitter executives ‘for cause’, according to a report, in an apparent bid to avoid having to pay them multimillion-dollar severance packages.
Musk, 51, took control of Twitter on Thursday, on completion of a contentious $44 billion deal.
He immediately fired the CEO, chief financial officer, head of legal, and general counsel.
Twitter’s securities filings show that senior executives are entitled to a year’s pay and accelerated vesting of at least a portion of their unvested stock awards if they are fired for any reason – other than cause – within a year of a company changing hands.
Parag Agrawal, the CEO, who repeatedly clashed with Musk over the number of users Twitter has, was reported to be walking away from his job with $42 million, after being a chief executive officer for just under a year.
Twitter’s former top lawyer Vijaya Gadde, who earned $17 million in 2021, was reportedly in tears in April when Musk’s takeover first came to light. She was in line for a $12.5 million payout, Insider said.
Ex-CFO Ned Segal – who was the man behind Donald Trump’s Twitter ban – was expected to receive $25.4 million after being fired by Musk on Thursday evening.
The payout for the general counsel, Sean Edgett, was unknown.
Musk’s reason for firing the four ‘for cause’ was not known, The Information reported.
Musk posted a video of himself marching into Twitter’s San Francisco headquarters carrying a porcelain sink on Wednesday
CEO Parag Agrawal (left) and head of legal policy Vijaya Gadde (right) were both in line for large payouts
Sean Edgett (left), the general counsel, and Ned Segal, chief financial officer for Twitter (right), have also reportedly been fired
Firing the four ‘for cause’ will likely lead to them challenging Musk in court.
It was also reported on Saturday that Musk will soon begin firing other members of staff – in part to avoid a November 1 distribution of stock grants to employees.
Musk has said multiple times that he plans on trimming down the company and making it profitable, and ever since his takeover was first raised in April staff have braced themselves for job losses.
In a securities filing on April 14, Musk said he did not have confidence in Twitter’s management and initially vowed to sack 75 percent of the workforce when he formally bought the tech giant.
On Saturday, The New York Times said the losses could come immediately – in part to skirt the November 1 deadline.
Four sources told the paper that some managers are being asked to draw up lists of employees to cut, as Musk tries to whittle down the staff numbers from its current 7,500.
Musk on Saturday did not discuss his plans – instead tweeting about the delights of bread, pastry and carbohydrates.
‘Finally, the truth that carbs are amazing can be said on this platform! #FreeSpeech,’ he tweeted.
He added: ‘#SoBrave’
Elon Musk confirmed on Thursday that he has bought Twitter ahead of a court-imposed deadline to seal his $44billion takeover of the company
Musk is believed to have ordered the cuts across the company, with some teams to be harder hit than others, said three of the people.
It was not clear how many people would be let go.
Just a day before being fired by Musk, Twitter lawyer Vijaya Gadde was photographed glaring at her new boss in an awkward meet-up with other employees at the HQ coffee bar.
Gadde, widely considered the ‘head of censorship’ at Twitter, had been vocal in her criticism of Musk; she cried during a meeting in April after he first announced plans to buy the company. She was a well-known Democrat donor and was behind the decision to squash links to a New York Post story about Hunter Biden’s incriminating laptop before the 2020 election.
Musk had publicly slammed her for the decision.
On Wednesday, she was spotted with Musk and others at the coffee bar at Twitter HQ. The next day, she was fired along with CEO Parag Agrawal and CFO Ned Segal.
But she walks away with a sizeable payout – a total of $72million in stocks that she owned, salary and benefits, and stocks that had not yet vested when she was in her position but which are now paid out as part of the deal.
MarketWatch reports that Gadde, Agrawal and Segal take a combined ‘golden parachute’ of $204million; Agrawal gets $66million and Segal takes $65million.
Musk has not yet publicly named their replacements but he is expected to act as interim CEO at least on a temporary basis.
Friday also marked the return of Musk’s friend, Kanye West, to Twitter after the troubled rapper was suspended from the platform following a series of anti-Semitic rants on social media.
Elon Musk speaks with employees including fired top counsel Vijaya Gadde (left) on Wednesday after taking over at Twitter. She was responsible for permanently banning President Trump from the site – a move that Musk says he will reverse
Musk at the Twitter coffee bar yesterday. He has vowed to fire 75 percent of the staff – to the dismay of many senior employees
There’s a new sheriff in town: Elon Musk tweets on Friday morning after taking over the company
TWITTER’S HEAD OF CENSORSHIP: LAWYER WHO BANNED TRUMP & DONATED $16,000 TO THE DEMOCRATS
Vijaya Gadde’s had been a low-key Silicon Valley power player for years, and at Twitter played a key role in the contentious decisions to ban Donald Trump and suppress news articles about Hunter Biden’s laptop.
After moving to the US from India with her family as a toddler, Gadde and her family faced racism as she grew up in Beaumont, Texas, where she has said her father had to seek approval from the Ku Klux Klan to sell insurance door-to-door.
Federal records show that she has also donated regularly to Democratic candidates, contributing more than $18,000 over the past two decades, and most recently supporting Kamala Harris with a $2,700 check in 2019.
As Twitter’s chief legal officer and general counsel, Gadde exercises enormous power at the company, where she has long essentially had final say over who is allowed on the platform, and what they can tweet.
In an interview with Bloomberg, Gadde once said that Twitter’s former CEO Jack Dorsey left the creation and enforcement of content policies up to her.
‘He rarely weighs in on an individual enforcement decision,’ Gadde told the outlet. ‘I can’t even think of a time. I usually go to him and say, ‘this is what’s going to happen.”
Although she maintains a low profile, that power has put Gadde at the center of some of Twitter’s most controversial moderation decisions, including the decision to permanently ban Trump after his supporters stormed the US Capitol in January 2021.
She also signed off on Twitter’s move to block the sharing of links to a New York Post article based on files from Hunter Biden’s abandoned laptop soon before the 2020 election.
As Musk ushered them out last night, he asked Tesla engineers to visit HQ today to start rewriting the website’s code.
Among his plans is to open source algorithms to increase transparency for users about how their data is used to suggest content to them, and to add an ‘edit’ button for all.
He also plans to allow President Trump back on the site.
Trump welcomed his takeover on Friday, writing on his own social media site Truth Social: ‘TRUTH SOCIAL has become somewhat of a phenomena.
‘Last week it had bigger numbers than all other platforms, including TikTok, Twitter, Facebook, and the rest.
‘It also looks and works better to my eye. I am very happy that Twitter is now in sane hands, and will no longer be run by Radical Left Lunatics and Maniacs that truly hate our country.
‘Twitter must now work hard to rid itself of all of the bots and fake accounts that have hurt it so badly.
‘It will be much smaller, but better. I LOVE TRUTH!’
Conservative figures who were banned from the platform now hope that his stated commitment to free speech will allow them to return.
The big names booted from Twitter include Donald Trump, Roger Stone, Alex Jones, Steve Bannon and US Rep. Marjorie Taylor Greene.
Among those who have decried his plans as dangerous is the former head of global public policy, Colin Crowell.
He left Twitter in 2019, long before Musk had designs on the site, but told The New York Times: ‘It’s a ‘back-to-the-future’ reversion to content rules circa 2010, but one that ignores the lived experience over the last decade.
‘People eventually realize that the Wild West needs a sheriff, both for ensuring the safety of citizens but also for enhancing the prospects for commerce.’
Twitter shares have risen steadily throughout the week in anticipation of the takeover, but they will be halted on Friday on the NYSE.
Musk plans to take the company private – a move that will somewhat shield him from the regulation and bureaucracy he faces with a publicly traded company.
Twitter’s former top lawyer Gadde, who earned $17 million in 2021, was reportedly in tears in April when Musk’s takeover first came to light. She has now been paid out $12.5 million for her troubles, Insider said.
Ex-CFO Segal – who was the man behind Mr Trump’s Twitter ban – also received the handsome sum of $25.4 million after being fired by Musk on Thursday evening.
And former CCO Sarah Personette was handed $11.2 million as part of Musk’s house clearance.
Despite Musk’s obvious delight with the astonishing deal which will go down in history, some experts have claimed that he has ‘overpaid’ for the platform.
Dan Ives, an analyst at Wedbush Securities, told the US Sun that the deal ‘will go down as one of the most overpaid tech acquisitions in the history of M&A deals on the Street in our opinion’.
Ives, who works for an LA-based investment firm, estimates the value of the company to be closer to $25 billion rather than the $44 billion.
‘With fair value that we would peg at roughly $25 billion, Musk buying Twitter remains a major head-scratcher that ultimately he could not get out of once the Delaware Courts got involved,’ he said.
In the lead-up to the South African’s buyout of the social media firm, the market positively reacted, with share prices visibly improving.
They went up by 7.23 percent in the last five days and were up about 1 percent at $53.94 in early trading on Wednesday.
The stock has surged nearly 65 percent from a four-month low hit in July.
However, after Musk’s purchase, the New York Stock Exchange’s website showed that Twitter shares would be suspended from trading.
The South African publicly criticized Twitter’s existing leadership team – in particular, attacking their policies on content moderation and censorship. He has also sparred with them over data on how many accounts were bots or spam.
This deal completion comes at the eleventh hour – just one day before Musk was going to be dragged back into court after being sued by Twitter for a back-and-forth he had over whether he was going to buy the company.
On Wednesday, the billionaire changed his Twitter profile to identify himself as the ‘Chief Twit’ and posted a video of himself walking into the company’s San Francisco headquarters carrying a porcelain sink.
This fueled rumors that Musk had closed the deal to buy Twitter in which he shared the clip with the caption: ‘Entering Twitter HQ, let that sink in’.
Agrawal, who took over from founder Jack Dorsey almost a year ago, has been at loggerheads with Musk over the number of genuine Twitter users, with Musk responding to a thread of Agrawal’s in May with a ‘poop’ emoji.
When Musk first made his takeover bid in April, he said he had not been given accurate data about spam accounts and bots.
Three months after launching his bid, Musk pulled out – insisting he had been misled about the size of the firm.
Twitter has for years said that bots make up less than 5 percent of its ‘monetizable daily active users’ (mDAU).
The fired five: Musk culls Twitter’s top executive staff members within hours of taking control of the company
Parag Agrawal, 38
- Chief Executive Officer since 2021
- 2021 compensation: $30.4 million
Agrawal took over from Jack Dorsey when he stood down as CEO in November 2021.
He has frequently clashed with Musk over Twitter’s user numbers, with Musk claiming the social media platform exaggerates how many users it has and downplays the number of spam accounts, fakes or bots.
Agrawal insisted that only around 5 percent of Twitter’s accounts were bots, which infuriated Musk. Musk responded to Agrawal’s lengthy explanation of their calculations with a ‘poop’ emoji.
The pair also argued in private.
They exchanged text messages that indicated a falling out, as revealed by documents disclosed in the legal battle between the billionaire and the social network.
On April 26, Dorsey, Musk and Agrawal convened a Google Hangout to discuss the takeover, and the conversation did not go well.
‘At least it became clear that you can’t work together. That was clarifying,’ Dorsey said.
Pictured: Parag Agrawal
Ned Segal, 48
- Chief Financial Officer since 2017
- 2021 compensation: $18.9 million
It was Segal who, in February 2021, announced that Twitter’s ban on Donald Trump was permanent.
Musk has said that decision was wrong, and he intends to reverse it.
‘The way our policies work, when you’re removed from the platform, you’re removed from the platform, whether you’re a commentator, you’re a CFO, or you are a former or current public official,’ he told CNBC.
‘Remember, our policies are designed to make sure that people are not inciting violence, and if anybody does that, we have to remove them from the service and our policies don’t allow people to come back.’
Segal also likely irked Musk with his cautious approach to finance – in particular his announcement in November that he didn’t think investing in cryptocurrency was a good move for Twitter.
Musk is famously a fan of cryptocurrency, and champions Doegecoin.
Segal told The Wall Street Journal that investing Twitter’s corporate cash in crypto assets such as bitcoin ‘doesn’t make sense right now.’
Pictured: Ned Segal
Vijaya Gadde, 48
- Head of Legal Policy since 2011
- 2021 compensation: $17 million
Gadde, described as Twitter’s ‘moral compass’, was a passionate defender of Twitter’s role as a censor and arbitrator. She was long considered one of the people who would be fired first by Musk.
In October 2019 she was the architect of the idea to stop political advertising on the platform, and shortly before the election she played a key role in the decision to suspend The New York Post’s account when it reported on Hunter Biden’s laptop. Twitter claimed it violated the company policy against promoting hacked material; critics were angered by the heavy-handedness, and Twitter later apologized.
In January 2021, it was Gadde who rang then-CEO Jack Dorsey – on vacation in Hawaii – to inform him they were banning Donald Trump, for violating policies against inciting violence.
Pictured: Gadde
Sean Edgett
- General Counsel since 2017
- 2021 compensation: unclear
Edgett, a close ally of Gadde, emailed staff last week to say there were no plans for mass layoffs – a move which may have irked Musk, given the impending takeover.
‘Please note that there will continue to be a great deal of public rumor and speculation as we get closer to closing the deal,’ Edgett wrote.
‘First, we have no confirmation of the buyer’s plans after closing and recommend not following any rumors or leaked documents, but instead awaiting facts from us and the buyer directly.’
Edgett added that there were ‘targeted cost-cutting discussions and plans’ earlier in the year, but those discussions stopped when Twitter and Musk signed a deal. Since then, there have been no plans for company-wide layoffs, he said.
He also warned employees earlier this year to refrain from sharing their opinions on Musk’s bid on social media.
A Twitter whistleblower claimed that senior figures at the company told him to destroy documents.
Peiter Zatko, the former head of security, who was fired in January, was seized upon by Musk as an ally in his fight to get to the bottom of the mystery about Twitter’s user numbers.
Zatko’s complaint, in which he accused Twitter of lying about its security practices and violating a 2011 agreement with the Federal Trade Commission, was described by Agrawal and Edgett as false.
‘We have never made a material misrepresentation to a regulator, to our board, to all of you,’ Edgett said. ‘We are in full compliance with our F.T.C. consent decree.’
Pictured: Sean Edgett
Sarah Personette
Personette worked as Twitter’s chief customer officer until she was fired on October 26.
The former CCO Personette was handed $11.2 million as part of Musk’s house clearance.
Just one day before she was culled from the workforce, she wrote on Twitter: ‘Had a great discussion with Elon Musk last evening! Our continued commitment to brand safety for advertisers remains unchanged. Looking forward to the future!’
Pictured: Sarah Personette
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