MIAMI, FL / ACCESSWIRE / October 12, 2023 / Special purpose acquisition company Digital World Acquisition Corp. (NASDAQ:DWAC) ("DWAC") and Trump Media & Technology Group Corp. ("TMTG"), which operates the Truth Social platform, announce successful progress towards the cancellation by certain investors (the "PIPE Investors") of their commitments to purchase up to an aggregate of 1,000,000 shares of DWAC Series A Convertible Preferred Stock (the "Preferred Stock") for a purchase price of $1,000 per share for an aggregate commitment of up to $1,000,000,000 in a private placement (the "PIPE").
As previously disclosed in DWAC's filings with the Securities and Exchange Commission (the "SEC"), in 2021, DWAC entered into securities purchase agreements (the "SPAs") with PIPE Investors in support of a PIPE to be consummated concurrently with the proposed business combination (the "Business Combination") with TMTG. Pursuant to the SPAs, each of the PIPE Investors had the right to terminate its respective SPA, among other things, if the closing of the PIPE had not occurred on or prior to September 20, 2022. In addition, to the extent PIPE Investors do not cancel such SPAs, due to evolving market and regulatory conditions, any remaining SPAs cannot be consummated under the current terms and conditions. Furthermore, as agreed in connection with the second amendment to the previously announced Agreement and Plan of Merger (the "Merger Agreement"), at the request of TMTG, DWAC agreed to use its reasonable best efforts to discuss with the PIPE Investors a reduction or termination of the PIPE.
The continued cancellation of these PIPE commitments represents an important milestone in the parties' performance of their obligations under the Merger Agreement. As of October 11, 2023, the remaining PIPE investment is $533,000,000. DWAC continues discussions with PIPE Investors for the cancelation of the remaining PIPE investment with the goal of eliminating the PIPE. DWAC and TMTG continue to move forward expeditiously toward their shared objective of completing the Business Combination in the coming months and are eager to complete the termination process of the PIPE as soon as possible.
"We are very grateful to the PIPE Investors who showed their support to DWAC and TMTG throughout the PIPE process and in the past two years as we continue to work toward consummating the Business Combination. We are confident that with these recent cancellations the PIPE Investors have again demonstrated their overall understanding of the closing conditions in the Merger Agreement, the regulatory landscape, and most importantly, demonstrated their support in seeing this merger through," said Eric Swider, CEO of DWAC. He added, "despite how others may seek to characterize the PIPE commitment cancellations, we want our shareholders to understand that these cancellations are a positive development in our ability to consummate the Business Combination and we ask for the support of the remaining PIPE investors by agreeing to terminate the remaining PIPE investments. Upon completion of our merger, the reduced need for capital by TMTG, reflects their commitment to growing a sustainable business model. This is a path that management of Digital World Acquisition Corporation fully supports."
"Today's announcement is an important step towards eliminating the PIPE-which TMTG believes would be in the best interest of TMTG's equity holders-and completing our merger with DWAC as soon as possible." said TMTG CEO Devin Nunes.
