Whistleblower payment doesn't breach deal terms as claimed by Musk: Twitter

(Reuters) -Twitter Inc said on Monday payments made to a whistleblower did not breach any terms of its $44 billion buyout by Elon Musk, after the world's richest man cited the move as another reason to scrap the deal.

In a letter to Twitter on Friday, lawyers for Musk said Twitter's failure to seek his consent before paying $7.75 million to whistleblower Peiter Zatko and his lawyers violated the merger agreement, which restricts when Twitter could make such payments.

Zatko, who was fired by Twitter in January as the company's security head, last month accused the social media firm of falsely claiming it had a solid security plan and making misleading statements about its defenses against hackers and spam accounts.

The whistleblower will meet the U.S. Senate Judiciary committee on Sept. 13 to discuss the allegations. Separately, Twitter is holding a special meeting on Tuesday for shareholders to vote on the merger.

Musk, who also runs the electric car company Tesla Inc, has accused Twitter of misrepresenting the prevalence of spam or bot accounts on its platform and has sought to terminate the deal citing those reasons.

A trial in Delaware Chancery Court is scheduled to begin on Oct. 17.

Musk's lawyers were not immediately available for comment.

(Reporting by Nivedita Balu in Bengaluru; Editing by Anil D'Silva)