This is correct. [This article][1] ([archive link][2]) goes through some of the contract law stuff, and they speak to this:
* 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" (MAE) on the company.
An MAE is apparently a high standard and courts [almost never find an MAE][2]
The article does also go on to say however that Musk will probably do whatever he wants without concern for the law, and without substantive repercussions. He can walk away from the deal just because he wants to, because he will be more aggressive in court than Twitter, and it wouldn't be advantageous of Twitter to go after him.
True, but Levine talks about that wrgt going against the SEC. Twitter is a billion dollar corporation with a signed IOU from Musk and a duty to go after it.
It's not the same as what Musk has pulled in the past, but will still be interesting to see how it plays out regardless.
* 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" (MAE) on the company.
An MAE is apparently a high standard and courts [almost never find an MAE][2]
[1]: https://www.bloomberg.com/opinion/articles/2022-05-13/elon-m...
[2]: https://archive.ph/NFWVp
[3]: https://www.jonesday.com/en/insights/2018/10/delaware-chance...