Elon Musk recently tried an unsolicited takeover of OpenAi that was rejected by CEO Sam Altman and OpenAi’s Nonfofit Bord.
Now the creator of Chatgpt is said to ensure that all future coups of the world’s richest man – or another investor – will not be successful.
According to a report in the Financial Times, the changes discussed would give the existing non-profit directors of OpenAI the special voting rights for non-profit organizations, so that they can retain the power over OpenAI, even while the artificial intelligence organization restructures in a profit-making as known as A company for public benefits.
By concentrating such a power in the non -profitar of OpenAi, the AI -tail could refute the argument of Musk that it has left its original charity mission. It can also enable board members to ignore other backers of the profit motive, such as Microsoft (MSFT) or Softbank.
Sam Altman, co-founder and CEO of OpenAi. Reuters/Axel Schmidt/File photo ·Reuters / Reuters
All that will maneuver a little by the board members of OpenAi and Altman, who are all defendants in a lawsuit of Musk who tries to block OpenAi from converting to a profit.
“There are strategic decisions that can be made to protect a non-profit against a hostile takeover or coup d’etat,” wrote non-profit-right-old expert Ellis Carter in her charity lawyer blog. But making the non -profit “really ignorable”, Carter explained, must be done carefully.
Because non -profit organizations have no shares and no formal ownership, she added: “Governance design is crucial.”
For now, the OpenAI board is authorized to ward off acquisitions, because it has no shareholders and no voting members entitled to vote as a non-profit. But University of California, Los Angeles Law Professor Rose Chan Loui, said that OpenAi seems to be aimed at strengthening a hostile takeover that could come after the conversion of the profit confirmation to a company for public benefits.
Chan Loui suspects that OpenAi would give his board members a special class voice shares in the restructured for-profit company with rights that are superior to other stock owners. At least, she said, their voices can cancel out all takeover movements by private investors, including the largest investor of OpenAi, Microsoft.
Furthermore, she said, it is unclear how specific the voting rights can be. For example, they can be limited to rejecting takeover attempts or so wide as the all-embracing rights that are currently being held by the non-profit organization.
“We need more detail,” said Chan Loui.
OpenAi did not respond to a request for clarification.
Microsoft CEO Satya Nadella, Right, and OpenAi CEO Sam Altman, Left, in 2023 at the OpenAI DEVDAY conference. (Justin Sullivan/Getty images) ·Justin Sullivan via Getty images
At the moment, investors such as Microsoft are not shareholders in OpenAI, but instead have limited profit interests in the subsidiary of OpenAI with profit. As soon as OpenAI is profitable, Microsoft is entitled to 75% of the profit until it earns its main investment of $ 13 billion. The other 25% of the profit goes to employees and early investors, up to specific profit caps.
Once the principal sum of Microsoft has been repaid, this is entitled to 50% of the profit until it reaches a profit of $ 92 billion.
OpenAi said it wants to convert his non -profit parent into a Delaware Public Benefit Corporation (PBC) that would spend ordinary shares.
In theory, the PBC can offer share interests to new investors and possibly convert the limited profit interests of existing investors into share interests.
Chan Loui said that the special voting rights can be designed to act as a poison pill with which the board and existing shareholders – unlike any activist investor – can buy extra shares with a considerable discount.
OpenAi is not fully inoculated by external bids, despite the power of the board. From a legal point of view, the board is the task of performing its mission to “ensure that artificial general intelligence … benefits all humanity.” And on her website says that this could mean that his resources are put behind a similarly oriented project.
“If a assigned, safety -conscious project comes close to building Agi before we do that, we connect to stop competing with and start helping this project,” said the charter of the charity institution.
Elon Musk After a meeting with Indian Prime Minister Narendra Modi in Washington, DC, on 13 February. Reuters/Nathan Howard/File photo ·Reuters / Reuters
According to the Law of Delaware, where OpenAi is registered, the non -profit organization has a duty to seriously revise acquisition and to explain reasons to reject them.
Charitative organizations are usually not objectives for hostile acquisitions, especially not the type that Musk had in mind – an unsolicited offer of $ 97.4 billion on the estimated $ 157 billion in intellectual property and other assets from OpenAI.
Instead, non-profit organizations are more often confronted with internal power struggle, such as the offensive of the Sierra Club environmental group in 2003 started by proponents of anti-immigration.
But non -profit organizations can in fact protect against takeovers of members by assigning special voting rights to board members as long as the rights comply with the laws of the State where the charity is organized, Non -Profit lawyer Frank Devito wrote in a blog post.
Musk and Altman originally co-founder of OpenAi as a non-profit in 2015, but Musk separated from the AI company due to disagreements with regard to how to continue with the company and eventually started a competitive AI company called Xai.
The lawsuit of Musk who wants to prevent the conversion from OpenAI to a profit-making company around Musk’s first donation of $ 45 million to finance the startup, which he claimed was dependent on OpenAI who remained a non-profit organization.
OpenAi has said that it must convert into a structure of profit to attract new capital.
For $ 97 billion, Musk’s takeover bid fell considerably under the current appreciation for the OpenAI assets. The Japanese conglomerate Softbank is planning a new investment of $ 40 billion, which, according to various media reports, would place the value of OpenAI to $ 260 billion to $ 300 billion.
Altman made his rejection public in a post on X, the social media platform previously known as Twitter that Musk bought in 2022 for $ 44 billion.
Altman wrote: “No thanks, but we will buy Twitter for $ 9.74 billion if you want.”
Elon Musk and Sam Altman in 2015 (photo by Michael Kovac/Getty images for Vanity Fair) ·Michael Kovac via Getty images
OpenAi also said in a separate judicial document that Musk’s offer on OpenAI opposed his claim in its current lawsuit that the OpenAI’s assets should not be used for profitable profit.
“The alleged takeover bid from Musk cannot be reconciled with the claim of the charity institution [he] Is going up in this court, “said it.
The Board of OpenAi officially rejected Musk’s offer on 14 February. “OpenAi is not for sale, and the board has Mr. Musk’s last attempt to disrupt his competition,” said Bret Taylor, chairman of OpenAi, in a statement on behalf of the board of directors, in a statement from the council.
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