As filed with the U.S. Securities and Exchange Commission on February 14, 2024.

Registration No. 333-264965

 

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

AMENDMENT NO. 6

TO

FORM S-4

REGISTRATION STATEMENT

UNDER

THE SECURITIES ACT OF 1933

 

 

Digital World Acquisition Corp.

(Exact name of registrant as specified in its charter)

 

 

 

Delaware		6770		85-4293042
(State or Other Jurisdiction of Incorporation or Organization)		(Primary Standard Industrial Classification Code Number)		(I.R.S. Employer Identification No.)

3109 Grand Ave., #450

Miami, Florida 33133

(305) 735-1517

(Address, including zip code, and telephone number, including area code, of  registrant’s principal executive offices)

Eric Swider

Chief Executive Officer

Digital World Acquisition Corp.

3109 Grand Ave., #450

Miami, Florida 33133

(305) 735-1517

(Name, address, including zip code, and telephone number, including area code,  of agent for service)

 

 

Copies to:

 

Brandon J. Bortner, Esq. Brad Bondi, Esq. Gil Savir, Esq. Maria M. Larsen, Esq. Paul Hastings LLP 2050 M Street NW, Washington, DC 20036 (202) 551-1700				John F. Haley, Esq. Jonathan H. Talcott, Esq. Michael D. Bryan, Esq. Nelson Mullins Riley & Scarborough LLP 2 South Biscayne Blvd., 21st Floor Miami, Florida 33131 (305) 373-9400

 

 

Approximate date of commencement of proposed sale to the public: As soon as practicable after this Registration Statement becomes effective and after all conditions under the Merger Agreement to consummate the proposed merger are satisfied or waived.

If the securities being registered on this Form are being offered in connection with the formation of a holding company and there is compliance with General Instruction G, check the following box: ☐

If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering: ☐

If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering: ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer		☐		Accelerated filer		☐
Non-accelerated		☒		Smaller reporting company		☒
				Emerging growth company		☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act. ☐

If applicable, place an X in the box to designate the appropriate rule provision relied upon in conducting this transaction:

Exchange Act Rule 13e-4(i) (Cross-Border  Issuer Tender Offer) ☐

Exchange Act Rule 14d-1(d) (Cross-Border Third-Party Tender Offer) ☐

 

 

The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the Registration Statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine.

 

 

 

The information in this preliminary proxy statement/prospectus is not complete and may be changed. These securities may not be issued until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary proxy statement/prospectus is not an offer to sell these securities and does not constitute the solicitation of offers to buy these securities in any jurisdiction where the offer or sale is not permitted.

 

PRELIMINARY — SUBJECT TO COMPLETION, DATED FEBRUARY 14, 2024

PROXY STATEMENT OF

DIGITAL WORLD ACQUISITION CORP.

PROSPECTUS FOR UP TO

135,869,509 SHARES OF COMMON STOCK

 

 

To the Stockholders of Digital World Acquisition Corp.:

We are pleased to provide this proxy statement/prospectus relating to the proposed merger (the “Merger”) of DWAC Merger Sub Inc., a Delaware corporation (“Merger Sub”) and a wholly owned subsidiary of Digital World Acquisition Corp., a Delaware corporation (“Digital World”), with and into Trump Media & Technology Group Corp., a Delaware corporation (“TMTG”), pursuant to an Agreement and Plan of Merger, dated as of October 20, 2021 (as amended by the First Amendment to Agreement and Plan of Merger, dated May 11, 2022, the Second Amendment to Agreement and Plan of Merger, dated August 9, 2023, the Third Amendment to Agreement and Plan of Merger, dated September 29, 2023, and as it may be further amended or supplemented from time to time, the “Merger Agreement”), by and among Digital World, Merger Sub, TMTG, ARC Global Investments II, LLC, a Delaware limited liability company, in the capacity as the representative of the stockholders of Digital World, and TMTG’s General Counsel in his capacity as the representative of the stockholders of TMTG. Capitalized terms used but not defined herein shall have the meanings ascribed to them in the Merger Agreement. If the Merger Agreement is adopted and the Merger and the other transactions contemplated thereby (collectively, the “Business Combination”) are approved by Digital World’s and TMTG’s stockholders, and the Business Combination is subsequently completed, the Merger Sub will merge with and into TMTG with TMTG surviving the Merger as a wholly owned subsidiary of Digital World. Upon the consummation of the Business Combination, Digital World will change its name to “Trump Media & Technology Group Corp.” As used in this proxy statement/prospectus, “New Digital World” refers to Digital World after giving effect to the consummation of the Business Combination. In addition, upon the consummation of the Business Combination, (a) all of the issued and outstanding TMTG common stock of TMTG immediately prior to the effective time of the Merger (the “Effective Time”) (other than those properly exercising any applicable appraisal rights under Delaware law or any shares of TMTG common stock issued upon the conversion of TMTG Convertible Notes immediately prior to the Effective Time pursuant to the terms of the Merger Agreement) will automatically be cancelled and will cease to exist, in exchange for the right to receive their pro rata portion of the Merger Consideration and the Earnout Shares, if any (each, as defined below), (b) all of the outstanding TMTG common stock that was issued upon the conversion of TMTG Convertible Notes immediately prior to the Effective Time pursuant to the terms of the Merger Agreement will automatically be cancelled and will cease to exist, in exchange for the right to receive shares of New Digital World common stock upon the terms set forth in the Merger Agreement, (c) each outstanding option to acquire shares of TMTG common stock (whether vested or unvested) will be assumed by New Digital World and automatically converted into an option to acquire shares of New Digital World common stock, with its price and number of shares equitably adjusted based on the conversion ratio of the shares of TMTG common stock into the Merger Consideration, and (d) each outstanding restricted stock unit of TMTG shall be converted into a restricted stock unit relating to shares of New Digital World common stock.

The Merger Agreement provides that (A) the aggregate merger consideration to be paid to TMTG securityholders (other than holders of TMTG Convertible Notes) as of immediately prior to the Effective Time will be an amount equal to $875,000,000, subject to adjustments for TMTG’s closing debt, net of cash and unpaid transaction expenses (the “Merger Consideration”), with each such TMTG securityholder receiving shares of New Digital World common stock for its TMTG securities, and (B) prior to the Effective Time, the issued and outstanding TMTG Convertible Notes will be converted into shares of TMTG common stock, such that, at the Effective Time, holders of such TMTG common stock will be entitled to receive from New Digital World a number of shares of New Digital World common stock equal to (i) the number of such shares of TMTG common stock multiplied by (ii) the conversion ratio applicable to the previously converted TMTG Convertible Notes. The Merger Consideration to be paid to TMTG securityholders will be paid solely by the delivery of new

shares of New Digital World common stock, with each valued at $10.00 per share. See “Summary of the Proxy Statement/Prospectus — The Business Combination Proposal (Proposal 1) — Merger Consideration” for additional details. Because TMTG securityholders are expected to control a majority of the voting power of the outstanding New Digital World common stock, with President Trump beneficially owning at least 58.1% of the voting power of such New Digital World common stock, New Digital World will then be a “controlled company” within the meaning of applicable rules of the Nasdaq Global Market (“Nasdaq”) upon the Closing. Under these rules, a company of which more than 50% of the voting power for the election of directors is held by an individual, group or another company is a “controlled company” and may elect not to comply with certain corporate governance requirements. TMTG intends to rely on these exemptions upon consummation of the Business Combination. As a result, New Digital World’s stockholders will not have the same protections afforded to stockholders of companies that are subject to all of the Nasdaq corporate governance requirements. See “Risk Factors — Risks Related to Digital World and the Business Combination — The Combined Entity will be a “controlled company” within the meaning of the applicable rules of Nasdaq and, as a result, qualifies for exemptions from certain corporate governance requirements. If the Combined Entity relies on these exemptions, its stockholders will not have the same protections afforded to stockholders of companies that are subject to such requirements.”

The Merger Agreement also provides that TMTG stockholders (other than with respect to any shares of TMTG common stock received as a result of the conversion of TMTG Convertible Notes) will also have a contingent right to receive up to an aggregate of an additional 40,000,000 shares of New Digital World common stock (the “Earnout Shares”) after the Closing based on the price performance of the New Digital World common stock during the three (3) year period following the Closing (the “Earnout Period”). The Earnout Shares shall be earned and payable during the Earnout Period as follows:

 

•

if the dollar volume-weighted average price (“VWAP”) of New Digital World common stock equals or exceeds $12.50 per share for any 20 trading days within any 30 trading day period, New Digital World shall issue to the former TMTG stockholders an additional 15,000,000 Earnout Shares;

 

•

if the VWAP of New Digital World common stock equals or exceeds $15.00 per share for any 20 trading days within any 30 trading day period, New Digital World shall issue to the former TMTG stockholders an additional 15,000,000 Earnout Shares; and

 

•

if the VWAP of New Digital World common stock equals or exceeds $17.50 per share for any 20 trading days within any 30 trading day period, New Digital World shall issue to the former TMTG stockholders an additional 10,000,000 Earnout Shares.

Digital World’s Public Units, Digital World Class A common stock and Digital World’s Public Warrants are publicly traded on the Nasdaq. We will apply to list the New Digital World common stock issuable upon consummation of the Business Combination on Nasdaq under the symbols “DJT” and “DJTW,” respectively, upon the Closing. Upon the Closing, Digital World’s Public Units will be separated into their component securities and will cease to be listed on Nasdaq.

Digital World will hold a virtual special meeting of its stockholders in order to obtain the stockholder approvals necessary to complete the Business Combination. At the Digital World Special Meeting, which will be held exclusively via a live audio webcast, on   , 2024 at 10:00 a.m., Eastern Time, unless postponed or adjourned to a later date, Digital World will ask its stockholders to adopt the Merger Agreement and the related transactions, thereby approving the Business Combination, and to approve the other Proposals described in this proxy statement/prospectus. To participate in the virtual meeting, a Digital World stockholder of record will need the 12-digit control number included on such stockholder’s proxy card or instructions that accompanied such stockholder’s proxy materials. If a Digital World stockholder holds his, her or its shares in “street name,” which means his, her or its shares are held of record by a broker, bank or other nominee, such Digital World stockholder should contact his, her or its broker, bank or nominee to ensure that votes related to the shares he, she or it beneficially owns are properly counted. In this regard, such Digital World stockholder must provide the record holder of his, her or its shares with instructions on how to vote his, her or its shares or, if such Digital World stockholder wishes to attend the special meeting of Digital World and vote in person, obtain a proxy from his,

her or its broker, bank or nominee. The live audio webcast of the Digital World special meeting will begin promptly at 10:00 a.m., Eastern Time. Digital World stockholders are encouraged to access the special meeting of Digital World prior to the start time. If you encounter any difficulties accessing the virtual meeting or during the meeting time, please call the technical support number that will be posted on the virtual meeting login page.

If you have any questions or need assistance with voting your Digital World common stock, please contact Alliance Advisors, Digital World’s proxy solicitor, by calling 877-728-4996 or by emailing dwac@allianceadvisors.com. This proxy statement/prospectus and the notice of the special meeting relating to the Business Combination will be available at www.proxyvote.com.

This proxy statement/prospectus provides you with detailed information about the Business Combination and other matters to be considered at the special meeting of Digital World’s stockholders. We encourage you to carefully read this entire proxy statement/prospectus, including all annexes attached hereto.

The accompanying proxy statement/prospectus provides stockholders of Digital World and TMTG with detailed information about the Business Combination and other matters to be considered at the special meeting of Digital World. We encourage you to read the entire accompanying proxy statement/prospectus, including the Annexes thereto and other documents referred to therein, carefully and in their entirety. You should also carefully consider the risk factors described in “Risk Factors” beginning on page 63 of the accompany proxy statement/prospectus.

NEITHER THE U.S. SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES REGULATORY AGENCY HAS APPROVED OR DISAPPROVED THE

TRANSACTIONS DESCRIBED IN THE ACCOMPANYING PROXY STATEMENT/PROSPECTUS OR ANY OF THE SECURITIES TO BE ISSUED IN THE BUSINESS COMBINATION, PASSED UPON THE MERITS OR FAIRNESS OF THE BUSINESS COMBINATION OR RELATED TRANSACTIONS OR PASSED UPON THE ADEQUACY OR ACCURACY OF THE DISCLOSURE IN THE ACCOMPANYING PROXY STATEMENT/PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY CONSTITUTES A CRIMINAL OFFENSE.

 

 

This proxy statement/prospectus is dated     , 2024, and is first being mailed to stockholders of Digital World on or about     , 2024.

Very truly yours,

Eric Swider

Chief Executive Officer

Digital World Acquisition Corp.

DIGITAL WORLD ACQUISITION CORP.

3109 Grand Ave., #450

Miami, Florida 33133

TO THE STOCKHOLDERS OF DIGITAL WORLD ACQUISITION CORP.:

NOTICE IS HEREBY GIVEN that a special meeting of stockholders (the “Digital World Special Meeting”) of Digital World Acquisition Corp., a Delaware corporation (“Digital World”), will be held virtually at 10:00 a.m., Eastern Time, on     , 2024. Details on how to participate are more fully described in this proxy statement/prospectus. At the Digital World Special Meeting, Digital World stockholders will be asked to consider and vote upon the following proposals (collectively, the “Proposals”).

You are cordially invited to attend the Stockholders Meeting, which will be held for the following purposes:

 

(1)

The Business Combination Proposal (Proposal 1) — To approve and adopt the Agreement and Plan of Merger, dated as of October 20, 2021 (as amended by the First Amendment to the Agreement dated May 11, 2022, the Second Amendment to the Agreement, dated August 9, 2023, the Third Amendment to the Agreement, dated September 29, 2023, and as it may further be amended or supplemented from time to time, the “Merger Agreement”), by and among Digital World, DWAC Merger Sub Inc., a Delaware corporation and wholly owned subsidiary of Digital World (“Merger Sub”), Trump Media & Technology Group Corp., a Delaware corporation (“TMTG”), ARC Global Investments II, LLC, a Delaware limited liability company, in the capacity as the representative of the stockholders of Digital World, and TMTG’s General Counsel in the capacity as the representative of the stockholders of TMTG, and approve the transactions contemplated thereby, including the merger of Merger Sub with and into TMTG, with TMTG continuing as the surviving corporation and as a wholly owned subsidiary of Digital World (the “Merger” and, together with the other transactions contemplated by the Merger Agreement, the “Business Combination”). As used herein, “New Digital World” refers to Digital World after giving effect to the consummation of the Business Combination. Upon the consummation of the Business Combination, Digital World will change its name to “Trump Media & Technology Group Corp.” Subject to the terms and conditions set forth in the Merger Agreement, among other matters, at the effective time of the Merger (the “Effective Time”):

 

(a)

the outstanding shares of Class A common stock, par value $0.0001 per share, of Digital World (“Digital World Class A common stock”), including any shares of Class B common stock, par value $0.0001 per share, of Digital World (“Digital World Class B common stock”, and together with the Digital World Class A common stock, the “Digital World common stock”) that are converted into Digital World Class A common stock in accordance with Digital World’s amended and restated certificate of incorporation (the “Digital World Charter”), will be redesignated as common stock, par value $0.0001 per share, of Trump Media & Technology Group Corp. (which will be the new name of Digital World after the Closing (referred to herein as “New Digital World common stock”);

 

(b)

as consideration for the Merger, TMTG securityholders (other than holders of TMTG Convertible Notes) as of immediately prior to the Effective Time will be entitled to receive an amount equal to $875,000,000, subject to adjustments for TMTG’s closing debt, net of cash and unpaid transaction expenses (the “Merger Consideration”), with each such TMTG securityholder receiving shares of New Digital World common stock for its TMTG securities. In addition, prior to the Effective Time, the issued and outstanding TMTG Convertible Notes will be converted into shares of TMTG common stock, such that, at the Effective Time, holders of such TMTG common stock (as defined below) will be entitled to receive from New Digital World a number of shares of New Digital World common stock equal to (i) the number of such shares of TMTG common stock multiplied by (ii) the conversion ratio applicable to the previously converted TMTG Convertible Notes. Accordingly, at the Effective Time, (a) all of the issued and outstanding TMTG common

 

1

stock immediately prior to the Effective Time (other than those properly exercising any applicable appraisal rights under Delaware law or any shares of TMTG common stock issued upon the conversion of TMTG Convertible Notes immediately prior to the Effective Time pursuant to the terms of the Merger Agreement) will automatically be cancelled and will cease to exist, in exchange for the right to receive their pro rata portion of the Merger Consideration and the Earnout Shares (as defined below), if any, (b) all of the issued and outstanding common stock of TMTG immediately prior to the Effective Time that was issued upon the conversion of TMTG Convertible Notes pursuant to the terms of the Merger Agreement will automatically be cancelled and will cease to exist, in exchange for the right to receive shares of New Digital World common stock upon the terms set forth in the Merger Agreement, (c) each outstanding option to acquire shares of TMTG common stock (whether vested or unvested) will be assumed by New Digital World and automatically converted into an option to acquire shares of New Digital World common stock, with its price and number of shares equitably adjusted based on the conversion ratio of the shares of TMTG common stock into the Merger Consideration, and (d) each outstanding restricted stock unit of TMTG shall be converted into a restricted stock unit relating to shares of New Digital World common stock; and

 

(c)

TMTG stockholders (other than with respect to any shares of TMTG common stock received as a result of the conversion of TMTG Convertible Notes) will also have a contingent right to receive up to an aggregate of an additional 40,000,000 shares of New Digital World common stock (the “Earnout Shares”) after the Closing based on the price performance of the New Digital World common stock during the three (3) year period following the Closing (the “Earnout Period”). The Earnout Shares shall be earned and payable during the Earnout Period as follows:

 

•

if the dollar volume-weighted average price (“VWAP”) of New Digital World common stock equals or exceeds $12.50 per share for any 20 trading days within any 30 trading day period, New Digital World shall issue to the former TMTG stockholders an additional 15,000,000 Earnout Shares;

 

•

if the VWAP of New Digital World common stock equals or exceeds $15.00 per share for any 20 trading days within any 30 trading day period, New Digital World shall issue to the former TMTG stockholders an additional 15,000,000 Earnout Shares; and

 

•

if the VWAP of New Digital World common stock equals or exceeds $17.50 per share for any 20 trading days within any 30 trading day period, New Digital World shall issue to the former TMTG stockholders an additional 10,000,000 Earnout Shares.

We refer to this proposal as the “Business Combination Proposal.” A copy of the Merger Agreement and the related agreements to be entered into pursuant to the Merger Agreement are attached to this proxy statement/prospectus as Annex A.

 

(2)

Charter Amendment Proposals (Proposals 2 through 6) — To approve and adopt subject to and conditioned on (but with immediate effect therefrom) approval of each of the Business Combination Proposal, the Director Election Proposal, the Incentive Plan Proposal and the Nasdaq Proposal and the consummation of the Business Combination, a second amendment and restatement to the amended and restated of certificate of incorporation of Digital World (the “Digital World Charter”), as set out in the draft second amended and restated version of Digital World Charter appended to this proxy statement/prospectus as Annex B (the “Amended Charter”), for the following amendments (collectively, the “Charter Amendment Proposals”):

 

(a)

Name Change — To provide that the name of Digital World shall be changed to “Trump Media & Technology Group Corp.” (Proposal 2);

 

(b)

Board Structure and Composition — To provide for the structure of the board of directors after the Closing (the “Board”), split into three classes of as even size as practicable, Class I, II, and III,

 

2

each to serve a term of three (3) years, except for the initial term, for which the Class I directors will be up for reelection at the first annual meeting of stockholders occurring after the Closing, and for which the Class II directors will be up for reelection at the second annual meeting of stockholders occurring after the Closing. Directors will not be able to be removed during their term except for cause. The size of the Board shall be determined by resolution of the Board but will initially be seven (7) (Proposal 3);

 

(c)

Amendment of Blank Check Provisions — To remove and change certain provisions in the Digital World Charter related to Digital World’s status as a special purpose acquisition company, including but not limited to the deletion of Article IX of the Digital World Charter in its entirety (Proposal 4);

 

(d)

The Authorized Share Charter Amendment — To increase the number of authorized shares of common stock to accommodate any shares to be issued in connection with (i) the Business Combination, (ii) the conversion of securities issued in Post-IPO Financings, (iii) the exercise of any Warrants, (iv) the conversion of TMTG Convertible Notes immediately prior to the Effective Time in connection with the Closing, (v) the Equity Incentive Plan and (vi) any future issuances of shares of New Digital World common stock if determined by the New Digital World Board to be in the best interests of New Digital World after the consummation of the Business Combination without incurring the risk, delay and potential expense incident to obtaining stockholder approval to increase the authorized share capital (Proposal 5); and

 

(e)

Amendment and Restatement of the Digital World Charter — Conditioned upon the approval of Proposals 2 through 5, to approve the proposed Amended Charter in the form attached as Annex B hereto, which includes the approval of all other changes in the proposed Amended Charter in connection with replacing the existing Digital World Charter with the proposed Amended Charter as of the Effective Time (Proposal 6).

 

(3)

The Director Election Proposal (Proposal 7) — To consider and vote upon a proposal to elect seven (7) directors to serve on the board of directors of New Digital World, each effective from the consummation of the Business Combination and for a term as set forth under the proposed Amended Charter or until such director’s earlier death, resignation, retirement or removal (the “Director Election Proposal”);

 

(4)

The Incentive Plan Proposal (Proposal 8) — To consider and vote upon a proposal to adopt the Trump Media & Technology Group Corp. 2024 Equity Incentive Plan (the “Equity Incentive Plan”), a copy of which is attached to this proxy statement/prospectus as Annex C and the issuance of common stock equal to 7.5% of the fully diluted, and as converted, amount of New Digital World common stock to be outstanding immediately following consummation of the Business Combination, taking into account any additional shares that may be issued pursuant to the Earnout Shares, if such plan is approved in accordance with the Incentive Plan Proposal (the “Incentive Plan Proposal”);

 

(5)

The Nasdaq Proposal (Proposal 9) — To consider and vote upon a proposal to approve, assuming that each of the Business Combination Proposal, the Charter Amendment Proposals, the Director Election Proposal and the Incentive Plan Proposal are approved and adopted, for the purposes of complying with Nasdaq Listing Rule 5635, the issuance of (a) shares of New Digital World common stock in the Business Combination pursuant to the terms of the Merger Agreement, (b) any additional shares of New Digital World common stock to be issued pursuant to the conversion of securities issued in the Post-IPO Financings, the exercise of Post-IPO Warrants, the conversion of TMTG Convertible Notes immediately prior to the Effective Time in connection with the Closing and the Equity Incentive Plan (the “Nasdaq Proposal”); and

 

(6)

The Adjournment Proposal (Proposal 10) — To consider and vote upon a proposal to adjourn the Digital World Special Meeting to a later date or dates, if necessary, to permit further solicitation and vote of proxies if, based upon the tabulated vote at the time of the Digital World Special Meeting, there

 

3

are not sufficient votes to approve the Business Combination Proposal, the Charter Amendment Proposals, the Director Election Proposal, the Incentive Plan Proposal, or the Nasdaq Proposal. We refer to this proposal as the “Adjournment Proposal.”

Only holders of record of Digital World common stock at the close of business on     , 2024 (the “Record Date”) are entitled to notice of the Digital World Special Meeting and to vote at the Digital World Special Meeting and any adjournments or postponements of the Digital World Special Meeting. A complete list of Digital World stockholders of record entitled to vote at the Digital World Special Meeting will be available for ten days before the Digital World Special Meeting at the principal executive offices of Digital World for inspection by stockholders during ordinary business hours for any purpose germane to the Digital World Special Meeting.

Pursuant to the Digital World Charter, Digital World is providing Digital World Public Stockholders with the opportunity to redeem, upon the Closing, shares of Digital World Class A common stock then held by them for cash equal to their pro rata share of the aggregate amount on deposit (as of two business days prior to the Closing) in the trust account of Digital World (the “Trust Account”) that holds the proceeds (including interest but less taxes payable) of the Digital World initial public offering (the “Digital World IPO”), including securities issued in connection with the underwriters’ over-allotment option after the Digital World IPO. For illustrative purposes, as of February 8, 2024, based on funds in the Trust Account of $312,083,428.12 as of such date, the pro rata portion of the funds available in the Trust Account for the Redemption of Public Shares of Digital World Class A common stock was approximately $10.85 per share. Digital World Public Stockholders are not required to affirmatively vote for or against the Business Combination in order to redeem their shares of common stock for cash. This means that Public Stockholders who hold shares of Digital World Class A common stock on or before     , 2024 (two (2) business days before the Digital World Special Meeting) will be eligible to elect to have their shares of Digital World Class A common stock redeemed for cash in connection with the Digital World Special Meeting, whether or not they are holders as of the Record Date, and whether or not such shares are voted at the Digital World Special Meeting. A Public Stockholder, together with any of his, her or its affiliates or any other person with whom it is acting in concert or as a “group” (as defined under Section 13(d)(3) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)), will be restricted from redeeming in the aggregate his, her or its shares or, if part of such a group, the group’s shares, with respect to more than 15% of the shares of Digital World common stock included in the Units of Digital World sold in the Digital World IPO (including over-allotment securities sold to Digital World’s underwriters after the Digital World IPO) without the prior consent of Digital World. Holders of Digital World’s outstanding Public Warrants and Units do not have Redemption Rights with respect to such securities in connection with the Business Combination. Holders of outstanding Digital World Units must separate the underlying shares of Digital World Class A common stock from the Public Warrants prior to exercising Redemption Rights with respect to the public Digital World Class A common stock. ARC Global Investments II LLC, the sponsor of Digital World (the “Sponsor”), Digital World’s then-officers and directors, in connection with their appointment and for an aggregate of 47,500 Founder Shares, and certain other current officers and directors, in connection with their appointment, agreed to waive their Redemption Rights with respect to any shares of Digital World common stock they may hold in connection with the consummation of the Business Combination. In addition, the anchor investors of Digital World have agreed to waive their Redemption Rights with respect to any shares of Digital World Class B common stock held by them in connection with the consummation of the Business Combination; holders of Digital World representative shares have agreed to waive their Redemption Rights with respect to such shares in connection with the consummation of the Business Combination; and all such shares will be excluded from the pro rata calculation used to determine the per-share Redemption price. Our Sponsor owns more than a majority of the outstanding shares of Class B common stock. Currently, the Sponsor and our directors and officers beneficially own 14.8% of the issued and outstanding shares of Digital World common stock and anchor investors beneficially own an aggregate of 4.4% of the issued and outstanding shares of Digital World Class B common stock. The Sponsor and Digital World’s directors and officers have agreed to vote any shares of Digital World common stock owned by them in favor of the Business Combination, which would include the Business Combination Proposal and the other Proposals. The anchor investors of Digital World have also agreed to vote any shares of Digital World Class B common stock held by them in favor of the Business Combination.

 

4

The approval of the Charter Amendment Proposals requires the affirmative vote in person (which would include presence at a virtual meeting) or by proxy of the holders, as of the Record Date, a majority of the then issued and outstanding shares of Class A common stock and Class B common stock, voting together as a single class.

The approval of the Business Combination Proposal, the Incentive Plan Proposal and the Nasdaq Proposal requires the affirmative vote in person (which would include presence at a virtual meeting) or by proxy of the holders, as of the Record Date, of a majority of votes cast of Class A common stock and Class B common stock, voting together as a single class, entitled to vote thereon at the Digital World Special Meeting.

The approval of the Director Election Proposal requires a plurality vote of the shares of Digital World common stock cast by the stockholders represented in person or by proxy and entitled to vote thereon at the Digital World Special Meeting.

The approval of the Adjournment Proposal requires the affirmative vote of a majority of the votes cast by the stockholders represented in person or by proxy and entitled to vote thereon at the Digital World Special Meeting.

If the Business Combination Proposal is not approved, the Charter Amendment Proposals, the Director Election Proposal, the Incentive Plan Proposal and the Nasdaq Proposal will not be presented to the Digital World stockholders for a vote. The approval of the Business Combination Proposal, the Charter Amendment Proposals, the Director Election Proposal, the Incentive Plan Proposal and the Nasdaq Proposal are preconditions to the consummation of the Business Combination.

While the Board approved the Business Combination, the Merger Agreement contemplates that during the pendency of the transaction TMTG will provide Digital World updated due diligence information regarding the financial condition of TMTG’s businesses and that following receipt and review of such due diligence information the Board could have, from October 31, 2023 through November 21, 2023, terminated the Merger Agreement if it no longer believed in good faith that the Business Combination was in the best interests of Digital World or its stockholders. Given the duration of time between the initial execution of the Merger Agreement and the Second Amendment to the Agreement as well as the significant turnover on the Digital World Board since the Merger Agreement was first signed in 2021, during December 2023 in connection with exercising its fiduciary duties, the Board sought to refresh and complete its financial and business due diligence of TMTG, including with respect to the revised transaction terms contemplated by the Second Amendment to the Agreement. In reaching its determination and in support of its decision that the Business Combination and the other transactions contemplated by the Merger Agreement, including the Merger Consideration and the Earnout Shares, are fair and in the best interests of Digital World and its stockholders, the Digital World Board conducted a bring-down evaluation of TMTG’s business model, financial performance, growth opportunities and competitive positioning. As part of this evaluation process, the Digital World Board engaged Alvarez & Marsal Valuation Services, LLC, with which Digital World has not had a material relationship in the past two years, as an independent advisor to prepare a comparable company analysis (the “Comparable Company Analysis”).

The Comparable Company Analysis was based on certain publicly traded companies selected by Digital World’s management and the Digital World Board, which included Meta, X (formerly Twitter), Snapchat and Pinterest. However, while these companies may share certain characteristics similar to TMTG, the Digital World Board did not consider any of these companies to be identical in nature to TMTG, given its affiliation with former President Trump and unique market positioning, including purposeful differentiation from the current market offerings considered in its analysis.

In December 2023, Digital World concluded its renewed due diligence with respect to TMTG’s business plan. Digital World’s Board determined (i) that the Merger Agreement and the transactions contemplated thereby, including the Merger Consideration and the Earnout Shares, are fair and in the best interests of Digital

 

5

World and (ii) to recommend that the Digital World stockholders adopt the Merger Agreement and approve the Business Combination and the other transactions contemplated by the Merger Agreement.

For illustrative purposes, as of February 8, 2024, there was approximately $312,083,428.12 in the Trust Account. Any Redemption of shares of Digital World Class A common stock by Digital World’s Public Stockholders will decrease the amount in the Trust Account. In accordance with the Digital World Charter, net tangible assets must be maintained at a minimum of $5,000,001 immediately prior to or upon consummation of the Business Combination.

Your attention is directed to this proxy statement/prospectus (including the annexes hereto) for a more complete description of the proposed Business Combination and related transactions and each of the Proposals. We encourage you to read this proxy statement/prospectus carefully. If you have any questions or need assistance voting your shares, please call us at 877-728-4996 or contact us by email dwac@allianceadvisors.com.

 

 

6

IF YOU RETURN YOUR PROXY CARD WITHOUT AN INDICATION OF HOW YOU WISH TO VOTE, YOUR SHARES WILL BE VOTED IN FAVOR OF EACH OF THE PROPOSALS.

TO EXERCISE YOUR REDEMPTION RIGHTS, YOU MUST, PRIOR TO 5:00 P.M., EASTERN TIME, ON     , 2024 (TWO (2) BUSINESS DAYS BEFORE THE DIGITAL WORLD SPECIAL MEETING), TENDER YOUR SHARES PHYSICALLY OR ELECTRONICALLY AND SUBMIT A REQUEST IN WRITING THAT WE REDEEM YOUR PUBLIC SHARES FOR CASH TO CONTINENTAL STOCK TRANSFER & TRUST COMPANY. PLEASE ALSO AFFIRMATIVELY CERTIFY IN YOUR REQUEST TO CONTINENTAL STOCK TRANSFER & TRUST COMPANY FOR REDEMPTION IF YOU “ARE” OR “ARE NOT” ACTING IN CONCERT OR AS A “GROUP” (AS DEFINED IN SECTION 13(D)(3) OF THE EXCHANGE ACT) WITH ANY OTHER STOCKHOLDER WITH RESPECT TO SHARES OF COMMON STOCK. YOU MUST ACT IN ACCORDANCE WITH THE PROCEDURES AND DEADLINES DESCRIBED IN THIS PROXY STATEMENT/PROSPECTUS. IF THE BUSINESS COMBINATION IS NOT CONSUMMATED, THEN THE PUBLIC SHARES WILL NOT BE REDEEMED FOR CASH. IF YOU HOLD THE SHARES IN STREET NAME, YOU WILL NEED TO INSTRUCT THE ACCOUNT EXECUTIVE AT YOUR BANK OR BROKER TO WITHDRAW THE SHARES FROM YOUR ACCOUNT IN ORDER TO EXERCISE YOUR REDEMPTION RIGHTS. SEE “THE DIGITAL WORLD SPECIAL MEETING — REDEMPTION RIGHTS” IN THIS PROXY STATEMENT/PROSPECTUS FOR MORE SPECIFIC INSTRUCTIONS.

THIS PROXY STATEMENT/PROSPECTUS INCORPORATES IMPORTANT BUSINESS AND FINANCIAL INFORMATION ABOUT DIGITAL WORLD AND TMTG THAT IS NOT INCLUDED IN OR DELIVERED HEREWITH. THIS INFORMATION IS AVAILABLE WITHOUT CHARGE TO STOCKHOLDERS OF DIGITAL WORLD UPON WRITTEN OR ORAL REQUEST. IF YOU WOULD LIKE TO MAKE SUCH REQUEST, YOU SHOULD CONTACT DIGITAL WORLD IN WRITING AT ERIC SWIDER, DIGITAL WORLD ACQUISITION CORP., 3109 GRAND AVE., #450, MIAMI, FLORIDA 33133 OR BY TELEPHONE AT (305) 735-1517. TO OBTAIN TIMELY DELIVERY, YOU MUST REQUEST THE INFORMATION NO LATER THAN     , 2024, WHICH IS FIVE BUSINESS DAYS BEFORE THE DATE YOU MUST MAKE YOUR INVESTMENT DECISION.

 

1

TABLE OF CONTENTS

 

		Page
ABOUT THIS DOCUMENT			1
MARKET AND INDUSTRY DATA			1
TRADEMARKS			1
FREQUENTLY USED TERMS			2
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS			8
QUESTIONS AND ANSWERS			11
SUMMARY OF THE PROXY STATEMENT/PROSPECTUS			31
SELECTED HISTORICAL CONSOLIDATED FINANCIAL INFORMATION OF DIGITAL WORLD			54
SELECTED HISTORICAL FINANCIAL INFORMATION OF TMTG			56
SUMMARY UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION			58
UNAUDITED HISTORICAL COMPARATIVE AND PRO FORMA COMBINED PER SHARE			60
DIVIDENDS ON SECURITIES			62
RISK FACTORS			63
UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION			147
INFORMATION ABOUT THE PARTIES TO THE BUSINESS COMBINATION			158
THE DIGITAL WORLD SPECIAL MEETING			160
THE BUSINESS COMBINATION PROPOSAL (PROPOSAL 1)			168
THE CHARTER AMENDMENT PROPOSALS (PROPOSALS 2 THROUGH 6)			213
THE DIRECTOR ELECTION PROPOSAL (PROPOSAL 7)			215
THE INCENTIVE PLAN PROPOSAL (PROPOSAL 8)			217
THE NASDAQ PROPOSAL (PROPOSAL 9)			224
THE ADJOURNMENT PROPOSAL (PROPOSAL 10)			226
INFORMATION ABOUT DIGITAL WORLD			227
DIGITAL WORLD’S MANAGEMENT			232
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS OF DIGITAL WORLD			240
INFORMATION ABOUT TMTG			246
EXECUTIVE OFFICERS AND DIRECTORS OF TMTG			255
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS OF TMTG			259
DESCRIPTION OF SECURITIES OF NEW DIGITAL WORLD			283
SECURITIES ACT RESTRICTIONS ON RESALE OF COMMON STOCK			294
COMPARISON OF STOCKHOLDER RIGHTS			295
BENEFICIAL OWNERSHIP OF SECURITIES			307
MANAGEMENT AFTER THE BUSINESS COMBINATION			311
EXECUTIVE AND DIRECTOR COMPENSATION OF TMTG			319
CERTAIN RELATIONSHIPS AND RELATED PERSON TRANSACTIONS			325
APPRAISAL RIGHTS			329
LEGAL MATTERS			329
EXPERTS			329
TRANSFER AGENT AND REGISTRAR			329
DELIVERY OF DOCUMENTS TO STOCKHOLDERS			330
SUBMISSION OF STOCKHOLDER PROPOSALS			330
STOCKHOLDER COMMUNICATIONS			330
CHANGE IN INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM			330
WHERE YOU CAN FIND MORE INFORMATION			332

 

i

INDEX TO FINANCIAL STATEMENTS			F-1
ANNEX A AGREEMENT AND PLAN OF MERGER			A-1
ANNEX A-1 FIRST AMENDMENT TO AGREEMENT AND PLAN OF MERGER			A-1-1
ANNEX A-2 SECOND AMENDMENT TO AGREEMENT AND PLAN OF MERGER			A-2-1
ANNEX A-3 THIRD AMENDMENT TO AGREEMENT AND PLAN OF MERGER			A-3-1
ANNEX B SECOND AMENDED AND RESTATED CERTIFICATE OF INCORPORATION			B-1
ANNEX C TRUMP MEDIA  & TECHNOLOGY GROUP CORP. 2024 EQUITY INCENTIVE PLAN			C-1

 

ii

ABOUT THIS DOCUMENT

This document, which forms part of a registration statement on Form S-4 filed with the SEC by Digital World, constitutes a prospectus of Digital World under the Securities Act of 1933, as amended (the “Securities Act”), with respect to the shares of common stock of Digital World to be issued to TMTG’s securityholders under the Merger Agreement. This document also constitutes a notice of meeting and a proxy statement of Digital World under Section 14(a) of the Exchange Act.

You should rely only on the information contained in, or incorporated by reference into, this proxy statement/prospectus. No one has been authorized to provide you with information that is different from that contained in, or incorporated by reference into, this proxy statement/prospectus. This proxy statement/prospectus is dated as of the date set forth on the cover hereof. You should not assume that the information contained in this proxy statement/prospectus is accurate as of any date other than that date. You should not assume that the information incorporated by reference into this proxy statement/prospectus is accurate as of any date other than the date of such incorporated document. Neither the mailing of this proxy statement/prospectus to Digital World stockholders nor the issuance by Digital World of its common stock in connection with the Business Combination will create any implication to the contrary.

Information contained in this proxy statement/prospectus regarding Digital World and its business, operations, management and other matters has been provided by Digital World and information contained in this proxy statement/prospectus regarding TMTG and its business, operations, management and other matters has been provided by TMTG.

This proxy statement/prospectus does not constitute an offer to sell or a solicitation of an offer to buy any securities, or the solicitation of a proxy or consent, in any jurisdiction to or from any person to whom it is unlawful to make any such offer or solicitation in such jurisdiction.

MARKET AND INDUSTRY DATA

This proxy statement/prospectus contains information concerning the market and industry in which TMTG conducts its business. TMTG operates in an industry in which it is difficult to obtain precise industry and market information. TMTG has obtained market and industry data in this proxy statement/prospectus from industry publications and from surveys or studies conducted by third parties that it believes to be reliable. TMTG cannot assure you of the accuracy and completeness of such information, and it has not independently verified the market and industry data contained in this proxy statement/prospectus or the underlying assumptions relied on therein. As a result, you should be aware that it is possible that any such market, industry and other similar data may not in fact be reliable. While TMTG is not aware of any misstatements regarding any industry data presented in this proxy statement/prospectus, such data involves risks and uncertainties and is subject to change based on various factors, including those discussed under the section entitled “Risk Factors” in this proxy statement/prospectus.

TRADEMARKS

This proxy statement/prospectus references the trademark and service mark applications of TMTG. Such applications include “Truth Social,” which was filed in the name of Trump Media & Technology Group Corp.; and “TMTG,” “TMTG+,” “POST A TRUTH,” “FOLLOW THE TRUTH” (word mark plus design), “RETRUTH,” “TRUTHSOCIAL,” “TRUTH SOCIAL” and “TRUTHPLUS,” which were filed in the name of T Media Tech LLC (TMTG’s wholly owned subsidiary that was acquired in October 2021). On February 14, 2023, a trademark for “Truth Social” in classes 21 and 25 was registered with the U.S. Patent and Trademark Office (“USPTO”) by T Media Tech LLC for use with mugs, cups and certain types of clothing. Trademark applications for “Truth Social” in classes 9 and 42; for “RETRUTH” in classes 9, 35, 38, 41, 42, and 45; for “TRUTHSOCIAL” in classes 9, 35, 38, 41, 42, and 45;

 

1

and for “TRUTHPLUS” in classes 9, 35, 38, 41, and 42 are the subject of suspension notices received from the USPTO on October 24, 2022; January 13, 2023; February 14, 2023 and February 17, 2023, respectively, in each case based on alleged similarity to existing registered and pending trademarks. In particular, the USPTO has issued non-final rejections of all the foregoing applications to register marks for use with a social media network or a streaming video service. Although TMTG has pursued certain appeal rights, there can be no assurance that TMTG will be able to overcome the trademark examiner’s objections or that the challenged marks will be approved. The other trademark applications listed above remain pending, but have not been the subject of adverse action by the USPTO. This proxy statement/prospectus also contains trademarks, service marks, trade names and copyrights of other companies, which are the property of their respective owners. Trademarks and service marks are collectively referred to herein as “Trademarks.” Solely for convenience, trademarks and trade names referred to in this proxy statement/prospectus may appear without the ^® or ^TM symbols, but such references are not intended to indicate, in any way, that we will not assert, to the fullest extent under applicable law, our rights or the right of the applicable licensor to these trademarks and trade names.

FREQUENTLY USED TERMS

Unless otherwise stated or unless the context otherwise requires, the terms “we,” “us,” “our,” and “Digital World” refer to Digital World Acquisition Corp.

In this document:

“Adeptus” means Adeptus Partners LLC, Digital World’s independent registered public accounting firm.

“Amended Charter” means the second amended and restated certificate of incorporation of Digital World to be adopted by Digital World pursuant to the Charter Amendment Proposals.

“anchor investors” are to (i) accounts or funds managed by Radcliffe Capital Management, L.P., (ii) Meteora Capital Partners, LP (an affiliate of Glazer Capital LLC), (iii) Castle Creek Strategies (and sub-funds associated with Castle Creek), (iv) The K2 Principal Fund L.P., (v) Context Partners Master Fund LP, (vi) Boothbay Absolute Return Strategies, LP (or its affiliate Boothbay Diversified Alpha Master Fund LP, commonly controlled by Boothbay Fund Management LLC), (vii) investment funds and accounts managed by Shaolin Capital Management, LLC, (viii) Hudson Bay Master Fund Ltd. and/or its affiliates, (ix) Saba Capital Master Fund, Ltd., Saba Capital Master Fund II, Ltd., Saba Capital Master Fund III, LP and Saba Capital SPAC Opportunities, Ltd., and/or its affiliates, (x) D. E. Shaw Valence Portfolios, L.L.C and (xi) Yakira Capital Management, Inc. (none of which are affiliated with any member of Digital World management, our sponsor or any other anchor investor), each of which entered into an investment agreement pursuant to which it expressed an interest to purchase up to 8.3% of the Public Units sold in the Digital World IPO.

“Board” or “Digital World Board” means (i) prior to the consummation of the Business Combination, the board of directors of Digital World and (ii) at and following the Closing, the board of directors of the Combined Entity.

“Borgers” means BF Borgers, TMTG’s independent registered public accounting firm.

“Business Combination” means the Merger and the other transactions contemplated by the Merger Agreement.

“Class A common stock” means the Class A common stock, par value $0.0001 per share, of Digital World.

“Class B common stock” means the Class B common stock, par value $0.0001 per share, of Digital World, including the Founder Shares.

 

2

“Closing” means the closing of the Business Combination.

“Code” means the Internal Revenue Code, as amended.

“Combined Entity” or “New Digital World” means Digital World after giving effect to the Business Combination, and which will include TMTG and any other direct or indirect subsidiaries of Digital World to the extent reasonably applicable.

“DGCL” means the General Corporation Law of the State of Delaware, as amended.

“Digital World” means Digital World Acquisition Corp., a Delaware corporation, which will be renamed “Trump Media & Technology Group Corp.” in connection with the Closing.

“Digital World Alternative Financing Notes” means up to $50,000,000 in 8.00% interest bearing convertible promissory notes due on the date that is twelve (12) months after the date of the stockholders’ approval of the Business Combination, in either (i) Working Capital Units, (ii) cash or (iii) a combination of both Working Capital Units and cash, in each case, at the election of the holder. Such Digital World Alternative Financing Notes may be redeemed by Digital World, in whole or in part, commencing on the date on which all New Digital World common stock issuable to the holders has been registered with the SEC, by providing a 10-day notice of such redemption (the “Alternative Notes Redemption Right”). This Alternative Notes Redemption Right is contingent upon the trading price of the New Digital World common stock exceeding 130% of the applicable conversion price on at least 3 trading days, whether consecutive or not, within the 15 consecutive trading days ending on the day immediately preceding the day on which a redemption notice is issued by Digital World. The redemption price will be the total of the principal amount redeemed under such note plus any applicable portion of accrued and unpaid interest up to, but excluding, the redemption date. The Digital World Alternative Financing Notes have a floor conversion price of $8.00 or greater.

“Digital World Alternative Warrants” means up to 3,050,000 Post IPO-Warrants to be issued concurrently with the Closing to certain institutional investors in Post-IPO Financings.

“Digital World Charter” or “Charter” means Digital World’s current amended and restated certificate of incorporation as filed with the Secretary of State of the State of Delaware as most recently amended and filed on September 6, 2023.

“Digital World common stock” means any of the Class A common stock and the Class B common stock of Digital World.

“Digital World Convertible Notes” means up to $40,000,000 in non-interest-bearing convertible promissory notes payable upon the stockholders’ approval of the Business Combination, in (A) either (i) Working Capital Units or (ii) cash or Working Capital Units, at the election of the holder or (B) in the case of such convertible promissory notes issued pursuant to the Convertible Note Compensation Plan, Class A common stock. Up to $30,000,000 of such convertible promissory notes may be issued to the Sponsor or its affiliates or Digital World’s officers or directors in connection with any loans made by them to Digital World prior to Closing. Up to $10,000,000 of such convertible promissory notes may be issued to either third parties providing services or making loans to Digital World or to the Sponsor or its affiliates or Digital World’s officers or directors in connection with any loans made by them to Digital World prior to Closing.

“Digital World IPO,” “IPO” or “Initial Public Offering” means Digital World’s initial public offering that was consummated on September 8, 2021.

“Digital World IPO Prospectus” means the final prospectus of Digital World, dated as of September 2, 2021, and filed with the SEC pursuant to Rule 424(b) under the Securities Act on September 8, 2021 (File No. 333-256472).

 

3

“Digital World Special Meeting” means the special meeting of the stockholders of Digital World, to be held virtually at 10:00 a.m., Eastern Time, on     , 2024.

“Effective Time” means the effective time of the Merger in accordance with the Merger Agreement.

“Equity Incentive Plan” means the Trump Media & Technology Group Corp. 2024 Equity Incentive Plan, as such may be amended, supplemented or modified from time to time, which shall be adopted by Digital World and approved in accordance with the Incentive Plan Proposal to be effective as of Closing.

“Exchange Act” means the Securities Exchange Act of 1934, as amended.

“First Amendment to the Agreement” means the First Amendment to Agreement and Plan of Merger, dated May 11, 2022, by and among Digital World, Merger Sub, TMTG, the Sponsor in the capacity as the representative of Digital World, and TMTG’s General Counsel in the capacity as the representative of TMTG.

“Founder Shares” means Class B common stock initially purchased by the Sponsor on January 20, 2021.

“Initial Stockholders” means the Sponsor and any other holders of the Founder Shares prior to the Digital World IPO (or their permitted transferees), if any.

“Marcum” means Marcum LLP, Digital World’s former independent registered public accounting firm.

“Merger” means the merger of Merger Sub with and into TMTG, with TMTG continuing as the surviving corporation and as a wholly owned subsidiary of Digital World, in accordance with the terms of the Merger Agreement.

“Merger Agreement” means the Agreement and Plan of Merger, dated October 20, 2021, as amended by the First Amendment to the Agreement, the Second Amendment to the Agreement and the Third Amendment to the Agreement, and as it may further be amended or supplemented from time to time, by and among Digital World, Merger Sub, TMTG, the Sponsor in the capacity as the representative of Digital World, and TMTG’s General Counsel in the capacity as the representative of TMTG.

“Merger Sub” means DWAC Merger Sub Inc., a Delaware corporation and a wholly owned subsidiary of Digital World.

“New Digital World common stock” means the common stock, par value $0.0001 per share, of Digital World (which will be renamed Trump Media & Technology Group Corp.) following the Business Combination that was previously designated Class A common stock of Digital World. New Digital World common stock will include any shares of Class B common stock all of which will be converted into common stock of Digital World in connection with the Closing pursuant to the Digital World Charter.

“PIPE Investment” means that certain private placement originally entered into in 2021 pursuant to certain securities purchase agreements (the “SPAs”) with certain institutional investors (the “PIPE Investors”), pursuant to which the PIPE Investors agreed to purchase shares of Digital World’s Series A Convertible Preferred Stock (the “Preferred Stock”) for a purchase price of $1,000 per share (the “PIPE”). The PIPE Investment was terminated in full as of January 10, 2024.

“Placement Shares” means the shares of Digital World Class A common stock included within the Placement Units purchased by the Sponsor in the Private Placement.

“Placement Units” means 1,133,484 units issued to the Sponsor in the Private Placement (including the additional units purchased after the Digital World IPO in connection with underwriters’ exercise of the over-allotment option to purchase additional securities). Each Placement Unit consists of one Placement Share and one-half of one Placement Warrant.

 

4

“Placement Warrants” means the warrants included within the Placement Units purchased by the Sponsor in the Private Placement. Each Placement Warrant entitles the holder thereof to purchase one share of Digital World Class A common stock for $11.50 per share.

“Post-IPO Financing” means any financing transaction undertaken by Digital World following its IPO but prior to or concurrently with the Closing, pursuant to which Digital World Convertible Notes, Digital World Alternative Financing Notes or Digital World Alternative Warrants are issued.

“Post-IPO Warrants” means any additional warrants issued or to be issued pursuant to the Warrant Agreement by the Company after the IPO, including any Digital World Alternative Warrants. Each Post-IPO Warrant entitles the holder thereof to purchase one share of Digital World Class A common stock for $11.50 per share and each Post-IPO Warrant, when and if issued, shall have substantially the same terms and be in the same form as the Public Warrants, except that such Post-IPO Warrants may only be transferred to the applicable holder’s affiliates.

“Prior Amendments” means, collectively, the First Amendment to the Agreement, the Second Amendment to the Agreement and the Third Amendment to the Agreement.

“Private Placement” means the private placement consummated simultaneously with the Digital World IPO in which Digital World issued to the Sponsor the Placement Units.

“Proposals” means the Business Combination Proposal, the Charter Amendment Proposals, the Director Election Proposal, the Incentive Plan Proposal, the Nasdaq Proposal and the Adjournment Proposal.

“Public Shares” means shares of Class A common stock included in the Public Units and shares of Class A common stock underlying the Public Warrants, each a “Public Share”.

“Public Stockholders” means holders of Public Shares, each a “Public Stockholder”.

“Public Units” means units issued in the Digital World IPO, including any over-allotment securities acquired by Digital World’s underwriters, consisting of one Public Share and one-half of one Public Warrant.

“Public Warrants” means warrants underlying the Units issued in the Digital World IPO. Each whole Public Warrant entitles the holder thereof to purchase one share of Class A common stock for $11.50 per share.

“Redemption” or “Redemption Rights” means the right of the holders of Class A common stock to have their shares redeemed in accordance with the procedures set forth in this proxy statement/prospectus and the Digital World Charter.

“Required Proposals” means the Business Combination Proposal, the Charter Amendment Proposals, the Director Election Proposal, the Incentive Plan Proposal and the Nasdaq Proposal.

“SEC” means the U.S. Securities and Exchange Commission.

“Second Amendment to the Agreement” means the Second Amendment to Agreement and Plan of Merger, dated August 9, 2023, by and among Digital World, Merger Sub, TMTG, the Sponsor in the capacity as the representative of Digital World, and TMTG’s General Counsel in the capacity as the representative of TMTG.

“Securities Act” means the Securities Act of 1933, as amended.

“Sponsor” means ARC Global Investments II LLC.

 

5

“Third Amendment to the Agreement” means the Third Amendment to Agreement and Plan of Merger, dated September 29, 2023, by and among Digital World, Merger Sub, TMTG, the Sponsor in the capacity as the representative of Digital World, and TMTG’s General Counsel in the capacity as the representative of TMTG.

“TMTG” means Trump Media & Technology Group Corp., a Delaware corporation, and includes the surviving corporation after the Merger. References herein to TMTG will include its subsidiaries to the extent reasonably applicable.

“TMTG 2022 Plan” means the Trump Media & Technology Group Corp. 2022 Equity Incentive Plan, adopted by TMTG following the date of Merger Agreement and prior to the Closing.

“TMTG Board” means the board of directors of TMTG.

“TMTG common stock” means shares of common stock, par value $0.000001 per share, of TMTG.

“TMTG Convertible Notes” means the (i) TMTG Executive Promissory Notes entered into in the ordinary course of TMTG’s business as compensation for certain of its directors and officers and (ii) series of convertible promissory notes in the aggregate principal amount of up to $60,000,000 issued by TMTG pursuant to those certain note purchase agreements, by and among TMTG and the holders party thereto including any additional convertible promissory notes (the “Additional TMTG Convertible Notes”) of like tenor entered into after the date of the Merger Agreement, which notes automatically convertible into TMTG common stock prior to the Effective Time. The number of shares of TMTG common stock to be issued to holders of the TMTG Convertible Notes will be equal to (A) (i) the principal amount of the applicable promissory note, divided by (ii) the applicable conversion price in such note (the “TMTG Convertible Note Base Shares”), (B) plus the number of shares of TMTG common stock equal to the product of (x) TMTG Convertible Note Base Shares multiplied by (y) 1 (one), minus the Conversion Ratio (as defined in the Merger Agreement). The Additional TMTG Convertible Notes are required to feature a floor conversion price of $8.00 or greater.

“TMTG Convertible Securities” means, collectively, any TMTG Options, TMTG RSUs, warrants or rights to subscribe for or purchase any capital stock of TMTG or securities convertible into or exchangeable for, or that otherwise confer on the holder any right to acquire any capital stock of TMTG.

“TMTG Executive Promissory Notes” means, collectively, the up to $9,200,000, in non-interest-bearing promissory notes entered into with certain TMTG directors and officers, automatically convertible into TMTG common stock prior to the Effective Time or otherwise payable on or before September 30, 2024. The number of shares of TMTG common stock to be issued to holders of the TMTG Executive Promissory Notes will be equal to (A) (i) the principal amount of the applicable promissory note, divided by (ii) $10.00 (the “TMTG Executive Note Base Shares”), plus (B) the number of shares of TMTG common stock equal to the product of (x) the TMTG Executive Note Base Shares multiplied by (y) one (1), minus the Conversion Ratio (as defined in the Merger Agreement). Any repayment of the TMTG Executive Promissory Notes (as well as any delivery of shares of TMTG common stock issued in settlement of the TMTG Executive Promissory Note) will be subject to applicable tax withholding.

“TMTG Options” means, collectively, all outstanding options to purchase shares of TMTG common stock, whether or not exercisable and whether or not vested, immediately prior to the Effective Time under the TMTG 2022 Plan or otherwise.

“TMTG RSUs” means all outstanding restricted stock units with respect to shares of TMTG common stock, whether or not vested, immediately prior to the Effective Time under the TMTG 2022 Plan or otherwise.

“TMTG securities” means any of the TMTG common stock and any TMTG Convertible Securities.

 

6

“TMTG securityholders” means, collectively, the holders of TMTG securities (other than, and to the extent that, such TMTG securities were received as a result of the conversion of the TMTG Convertible Notes).

“TMTG stockholders” means, collectively, the holders of TMTG common stock, each a “TMTG stockholder” (other than, and to the extent that, such TMTG common stock was received as a result of the conversion of the TMTG Convertible Notes).

“Trust Account” means the trust account of Digital World, which holds the net proceeds of (i) the Digital World IPO, including from over-allotment securities sold by Digital World’s underwriters, (ii) the sale of the Placement Units and (iii) the additional funds deposited by the Sponsor to the Trust Account to extend the period of time to consummate an initial business combination, together with interest earned thereon, less amounts released to pay tax obligations and up to $100,000 for dissolution expenses, and amounts paid pursuant to Redemptions.

“U.S. GAAP” means generally accepted accounting principles in the United States.

“Units” means any of the Public Units, Placement Units, and the Working Capital Units.

“Warrant Agreement” means that warrant agreement, dated September 2, 2021, by and between the Company and Continental Stock Transfer & Trust Company, as warrant agent, as filed with the SEC on September 9, 2021 on Form 8-K.

“Warrants” means any of the Post-IPO Warrants, Public Warrants, the Placement Warrants and the warrants underlying the Working Capital Units, excluding any warrants of TMTG.

“Working Capital Units” means any units issuable pursuant to the Digital World Convertible Notes or the Digital World Alternative Financing Notes, as applicable. Each unit consists of one share of Digital World Class A common stock and one-half Warrant. Each unit issuable pursuant to the applicable Digital World Convertible Notes or the Digital World Alternative Financing Notes, subject to the terms and conditions of each such applicable note, shall not have a price lower than $8.00 per unit.

 

7

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This proxy statement/prospectus (including the documents incorporated by reference herein) contains forward-looking statements regarding, among other things, the plans, strategies and prospects, both business and financial, of Digital World and TMTG. These statements are based on the beliefs and assumptions of the management of Digital World and TMTG. Although Digital World and TMTG believe that their respective plans, intentions and expectations reflected in or suggested by these forward-looking statements are reasonable, neither Digital World nor TMTG can assure you that either will achieve or realize these plans, intentions or expectations. Forward-looking statements are inherently subject to risks, uncertainties and assumptions. Generally, statements that are not historical facts, including statements concerning possible or assumed future actions, business strategies, events or results of operations, are forward-looking statements. These statements may be preceded by, followed by or include the words “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “might,” “plan,” “possible,” “potential,” “predict,” “project,” “should,” “would” or similar expressions, but the absence of these words does not mean that a statement is not forward-looking. Neither Borgers, TMTG’s independent auditor, nor Adeptus, Digital World’s independent auditor, has examined, compiled or otherwise applied procedures with respect to the accompanying forward-looking financial information presented herein and, accordingly, expresses no opinion or any other form of assurance on it. The report of Borgers included in this proxy statement/prospectus relates to historical financial information of TMTG, and the report of Adeptus included in this proxy statement/prospectus relates to historical financial information of Digital World. Neither report extends to the forward-looking information and should not be read as if it does. Forward-looking statements contained in this proxy statement/prospectus include, but are not limited to, statements about:

 

•

the ability of Digital World and TMTG prior to the Business Combination to meet the closing conditions to the Business Combination, including approval by stockholders of Digital World and TMTG of the Business Combination and related Proposals, and the availability of at least $5,000,001 in net tangible assets, after giving effect to Redemptions of Public Shares, if any;

 

•

the ability of the Combined Entity following the Business Combination to realize the benefits from the Business Combination;

 

•

the ability of Digital World to complete the Business Combination;

 

•

the occurrence of any event, change or other circumstances that could give rise to the termination of the Merger Agreement;

 

•

the ability of Digital World and TMTG prior to the Business Combination, and the Combined Entity following the Business Combination, to obtain and/or maintain the listing of New Digital World common stock on Nasdaq following the Business Combination;

 

•

future financial performance following the Business Combination;

 

•

public securities’ potential liquidity and trading;

 

•

the use of proceeds not held in the Trust Account or available to Digital World from interest income on the Trust Account balance;

 

•

the impact from the outcome of any known and unknown litigation;

 

•

the ability of the Combined Entity to forecast and maintain an adequate rate of revenue growth and appropriately plan its expenses;

 

•

expectations regarding future expenditures of the Combined Entity following the Business Combination;

 

•

the future mix of revenue and effect on gross margins of the Combined Entity following the Business Combination;

 

8

 

•

the attraction and retention of qualified directors, officers, employees and key personnel of Digital World and TMTG prior to the Business Combination, and the Combined Entity following the Business Combination;

 

•

the ability of the Combined Entity to compete effectively in a competitive industry;

 

•

the impact of the ongoing legal proceedings in which President Trump is involved on TMTG’s corporate reputation and brand;

 

•

expectations concerning the relationships and actions of TMTG and its affiliates with third parties;

 

•

the impact from future regulatory, judicial, and legislative changes in TMTG’s or the Combined Entity’s industry;

 

•

the ability to locate and acquire complementary products or product candidates and integrate those into TMTG’s or the Combined Entity’s business;

 

•

future arrangements with, or investments in, other entities or associations;

 

•

intense competition and competitive pressures from other companies in the industries in which the Combined Entity will operate; and

 

•

other factors detailed under the section entitled “Risk Factors.”

These forward-looking statements are based on information available as of the date of this proxy statement/prospectus, and current expectations, forecasts and assumptions, and involve a number of risks and uncertainties. Accordingly, forward-looking statements should not be relied upon as representing our views as of any subsequent date, and we do not undertake any obligation to update forward-looking statements to reflect events or circumstances after the date they were made, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws.

In addition, statements that Digital World or TMTG “believes” and similar statements reflect such party’s beliefs and opinions on the relevant subject. These statements are based upon information available to such party as of the date of this proxy statement/prospectus, and while such party believes such information forms a reasonable basis for such statements, such information may be limited or incomplete, and these statements should not be read to indicate that either Digital World or TMTG has conducted an exhaustive inquiry into, or review of, all potentially available relevant information. These statements are inherently uncertain and investors are cautioned not to unduly rely upon these statements.

You should not place undue reliance on these forward-looking statements in deciding how to grant your proxy or instruct how your vote should be cast or vote your shares on the Proposals set forth in this proxy statement/prospectus. As a result of a number of known and unknown risks and uncertainties, the actual results or performance of Digital World, TMTG and/or the Combined Entity may be materially different from those expressed or implied by these forward-looking statements. Some factors that could cause Digital World’s, TMTG’s or the Combined Entity’s actual results to differ include:

 

•

the occurrence of any event, change or other circumstances that could give rise to the termination of the Merger Agreement;

 

•

the outcome of any legal or regulatory proceedings that have been, or may be, instituted in the future against Digital World, TMTG, the Combined Entity or others following announcement of the Merger Agreement and the transactions contemplated therein or following consummation of the Business Combination;

 

•

the inability to complete the transactions contemplated by the Merger Agreement due to the failure to obtain approval of the stockholders of Digital World or TMTG or other conditions to Closing;

 

9

•

the risk that the proposed transaction disrupts current plans and operations as a result of the announcement and consummation of the Business Combination;

 

•

the ability to recognize the anticipated benefits of the Business Combination, which may be affected by, among other things, the ability of the Combined Entity to grow and manage growth profitably, maintain relationships with customers, compete within its industry and retain its key employees;

 

•

costs related to the proposed Business Combination;

 

•

the possibility that Digital World, TMTG or the Combined Entity may be adversely impacted by other economic, business, and/or competitive factors;

 

•

risks related to future pandemics and other macroeconomic or geopolitical developments, and government responses thereto;

 

•

future exchange and interest rates;

 

•

the risk that Digital World, or the Combined Entity fails to maintain an effective system of disclosure controls and internal controls over financial reporting, Digital World’s or the Combined Entity’s ability to produce timely and accurate financial statements or comply with applicable SEC or stock exchange regulations could be impaired;

 

•

the ability of the Combined Entity to remediate material weaknesses in internal controls over financial reporting identified in TMTG’s financial statements by TMTG management; and

 

•

other risks and uncertainties indicated in this proxy statement/prospectus, including those under “Risk Factors” herein, and other filings that have been made or will be made with the SEC by Digital World or the Combined Entity.

These and other factors that could cause actual results to differ from those implied by the forward-looking statements in this proxy statement/prospectus are more fully described under the heading “Risk Factors” and elsewhere in this proxy statement/prospectus. The risks described under the heading “Risk Factors” are not exhaustive. Other sections of this proxy statement/prospectus describe additional factors that could adversely affect the business, financial condition or results of operations of Digital World and TMTG prior to the Business Combination, and the Combined Entity following the Business Combination. New risk factors emerge from time to time and it is not possible to predict all such risk factors, nor can Digital World or TMTG assess the impact of all such risk factors on the business of Digital World and TMTG prior to the Business Combination, and the Combined Entity following the Business Combination, or the extent to which any factor or combination of factors may cause actual results to differ materially from those contained in any forward-looking statements. Forward-looking statements are not guarantees of performance. This is particularly true for a company like TMTG that has a limited operating history to reference. All forward-looking statements attributable to Digital World or TMTG or persons acting on their behalf are expressly qualified in their entirety by the foregoing cautionary statements.

 

10

QUESTIONS AND ANSWERS

The following questions and answers briefly address some commonly asked questions about the Proposals to be presented at the Digital World Special Meeting. The following questions and answers do not include all the information that is important to stockholders of Digital World. We urge the stockholders of Digital World to read carefully this entire proxy statement/prospectus, including the annexes and other documents referred to herein.

QUESTIONS AND ANSWERS ABOUT THE DIGITAL WORLD PROPOSALS

 

Q.	Why am I receiving this proxy statement/prospectus?

 

A.

Digital World stockholders are being asked to consider and vote upon a proposal to approve the Business Combination contemplated by the Merger Agreement, among other Proposals. Pursuant to the Merger set forth in the Merger Agreement, TMTG will become a wholly owned subsidiary of Digital World. A copy of the Merger Agreement is attached to this proxy statement/prospectus as Annex A.

This proxy statement/prospectus and its annexes contain important information about the proposed Business Combination and the other matters to be acted upon at the Digital World Special Meeting. You should read this proxy statement/prospectus and its annexes carefully and in their entirety.

THE VOTE OF DIGITAL WORLD STOCKHOLDERS IS IMPORTANT. DIGITAL WORLD STOCKHOLDERS ARE URGED TO SUBMIT THEIR PROXIES AS SOON AS POSSIBLE AFTER CAREFULLY REVIEWING THIS PROXY STATEMENT/PROSPECTUS AND ITS ANNEXES AND CAREFULLY CONSIDERING EACH OF THE PROPOSALS BEING PRESENTED AT THE MEETING.

Below are proposals on which Digital World stockholders are being asked to vote.

1) The Business Combination Proposal (Proposal 1).

Subject to the terms and conditions set forth in the Merger Agreement, at the Effective Time:

 

(a)

the outstanding shares of Class A common stock, par value $0.0001 per share, of Digital World (“Digital World Class A common stock”), including any shares of Class B common stock, par value $0.0001 per share, of Digital World (“Digital World Class B common stock”, and together with the Digital World Class A common stock, the “Digital World common stock”) that are converted into Digital World Class A common stock in accordance with the Digital World Charter, will be redesignated as common stock, par value $0.0001 per share, of Trump Media & Technology Group Corp. (which will be the new name of Digital World after the Closing, as described below, “New Digital World”) (referred to herein as “New Digital World common stock”);

 

(b)

as consideration for the Merger, TMTG securityholders (other than holders of TMTG Convertible Notes) as of immediately prior to the Effective Time will be entitled to receive an amount equal to $875,000,000, subject to adjustments for TMTG’s closing debt, net of cash and unpaid transaction expenses (the “Merger Consideration”), with each such TMTG securityholder receiving shares of New Digital World common stock for its TMTG securities. In addition, prior to the Effective Time, the issued and outstanding TMTG Convertible Notes will be converted into shares of TMTG common stock, such that, at the Effective Time, holders of such TMTG common stock will be entitled to receive from New Digital World a number of shares of New Digital World common stock equal to (i) the number of such shares of TMTG common stock multiplied by (ii) the conversion ratio applicable to the previously converted TMTG Convertible Notes. Accordingly, at the Effective Time, (a) all of the issued and outstanding TMTG common stock immediately prior to the Effective Time (other than those properly exercising any applicable appraisal rights under Delaware law or any shares of TMTG

 

11

common stock issued upon the conversion of TMTG Convertible Notes immediately prior to the Effective Time pursuant to the terms of the Merger Agreement) will automatically be cancelled and will cease to exist, in exchange for the right to receive their pro rata portion of the Merger Consideration and the Earnout Shares (as defined below), if any, (b) all of the issued and outstanding common stock of TMTG immediately prior to the Effective Time that was issued upon the conversion of TMTG Convertible Notes pursuant to the terms of the Merger Agreement will automatically be cancelled and will cease to exist, in exchange for the right to receive shares of New Digital World common stock upon the terms set forth in the Merger Agreement, (c) each outstanding option to acquire shares of TMTG common stock (whether vested or unvested) will be assumed by New Digital World and automatically converted into an option to acquire shares of New Digital World common stock, with its price and number of shares equitably adjusted based on the conversion ratio of the shares of TMTG common stock into the Merger Consideration, and (d) each outstanding restricted stock unit of TMTG shall be converted into a restricted stock unit relating to shares of New Digital World common stock.

 

(c)

TMTG stockholders (other than with respect to any shares of TMTG common stock received as a result of the conversion of TMTG Convertible Notes) will also have a contingent right to receive up to an aggregate of an additional 40,000,000 shares of New Digital World common stock (the “Earnout Shares”) after the Closing based on the price performance of the New Digital World common stock during the three (3) year period following the Closing (the “Earnout Period”). The Earnout Shares shall be earned and payable during the Earnout Period as follows:

 

•

if the VWAP of New Digital World common stock equals or exceeds $12.50 per share for any 20 trading days within any 30 trading day period, New Digital World shall issue to the former TMTG stockholders an additional 15,000,000 Earnout Shares;

 

•

if the VWAP of New Digital World common stock equals or exceeds $15.00 per share for any 20 trading days within any 30 trading day period, New Digital World shall issue to the former TMTG stockholders an additional 15,000,000 Earnout Shares; and

 

•

if the VWAP of New Digital World common stock equals or exceeds $17.50 per share for any 20 trading days within any 30 trading day period, New Digital World shall issue to the former TMTG stockholders an additional 10,000,000 Earnout Shares.

The Merger Consideration will be subject to a post-Closing true up 90 days after the Closing.

In addition to the approval of the Proposals at the Digital World Special Meeting, unless waived by the parties to the Merger Agreement, in accordance with applicable law, the Closing is subject to a number of conditions set forth in the Merger Agreement including, among others, receipt of the requisite stockholder approval contemplated by this proxy statement/prospectus. For more information about the closing conditions to the Business Combination, see the section titled “The Business Combination Proposal (Proposal 1) — The Merger Agreement — Conditions to the Closing.”

The Merger Agreement may be terminated at any time prior to the Closing upon agreement of TMTG and Digital World, or by TMTG or Digital World acting alone, in specified circumstances. For more information about the termination rights under the Merger Agreement, see the section titled “The Business Combination Proposal (Proposal 1) — The Merger Agreement — Termination.”

Pursuant to the Digital World Charter, in connection with the Business Combination, holders of Public Shares may elect to have their shares redeemed for cash at the applicable Redemption price per share calculated in accordance with the Digital World Charter. For illustrative purposes, as of February 8, 2024, the pro rata portion of the funds available in the Trust Account for the Public Shares was approximately $10.85 per share. If a holder exercises its Redemption Rights in connection with the Business Combination, then such holder will be exchanging its Class A common stock for cash and will only have equity interests in the Combined Entity pursuant to its right to exercise its Public Warrants, to the extent it still holds Public Warrants. Such a holder will

 

12

be entitled to receive cash for its Public Shares only if it properly demands Redemption and delivers its shares (either physically or electronically) to our transfer agent at least two business days prior to the Digital World Special Meeting. Holders of Public Shares may elect to redeem their shares whether or not such shares are voted at the Digital World Special Meeting. See the section titled “The Digital World Special Meeting — Redemption Rights.”

The transactions contemplated by the Merger Agreement will be consummated only if the Business Combination Proposal, the Charter Amendment Proposals, the Director Election Proposal, the Incentive Plan Proposal and the Nasdaq Proposal are approved at the Digital World Special Meeting. In addition, the Charter Amendment Proposals, the Director Election Proposal, the Incentive Plan Proposal and the Nasdaq Proposal are conditioned on the approval of the Business Combination Proposal (and each such Proposal is cross-conditioned on the approval of all Required Proposals). The Adjournment Proposal is not conditioned on the approval of any other proposal set forth in this proxy statement/prospectus.

The Combined Entity’s Board will increase to seven members upon the Closing. In accordance with the Amended Charter to be filed immediately after the Closing, the Board will be divided into three classes, with each director to serve for a three-year term, except for the initial terms after the Closing. At each annual meeting of stockholders of the Combined Entity, the successors to directors whose terms then expire will be elected to serve from the time of election and qualification until the third annual meeting following the election. See the Charter Amendment Proposals below for more information.

The Business Combination involves numerous risks. For more information about these risks, see the section titled “Risk Factors.”

2) The Charter Amendment Proposals (Proposals 2 through 6).

Digital World stockholders will be asked to approve and adopt, subject to and conditioned on (but with immediate effect therefrom) approval of each of the Business Combination Proposal, the Director Election Proposal, the Incentive Plan Proposal and the Nasdaq Proposal and the consummation of the Business Combination, a second amendment and restatement of the Digital World Charter, as set out in the Amended Charter appended to this proxy statement/prospectus as Annex B, for the following amendments (collectively, the “Charter Amendment Proposals”):

 

(a)

Name Change – To provide that the name of New Digital World shall be changed to “Trump Media & Technology Group Corp.” (Proposal 2);

 

(b)

Board Structure and Composition – To provide for the structure of the post-Closing Board, split into three classes of as even size as practicable, Class I, II, and III each to serve a term of three (3) years, except for the initial term, for which the Class I directors will be up for reelection at the first annual meeting of stockholders occurring after the Closing, and for which the Class II directors will be up for reelection at the second annual meeting of stockholders occurring after the Closing. Directors will not be able to be removed during their term except for cause, and then only by the affirmative vote of the holders of not less than two thirds (2/3) of the outstanding shares of capital stock then entitled to vote at an election of directors. The size of the Board of the Combined Entity shall be determined by resolution of such Board but will initially be seven (7) (Proposal 3);

 

(c)

Amendment of Blank Check Provisions – To remove and change certain provisions in the Digital World Charter related to Digital World’s status as a special purpose acquisition company, including the deletion of Article IX of the Digital World Charter in its entirety (Proposal 4);

 

(d)

The Authorized Share Charter Amendment – To increase the number of authorized shares of common stock to accommodate any shares to be issued in connection with (i) the Business Combination, (ii) the conversion of securities issued in Post-IPO Financings, (iii) the exercise of any Warrants, (iv) the conversion of TMTG Convertible Notes immediately prior to the Effective

 

13

Time in connection with the Closing, (v) the Equity Incentive Plan and (vi) any future issuances of shares of New Digital World common stock if determined by the New Digital World Board to be in the best interests of New Digital World after the consummation of the Business Combination without incurring the risk, delay and potential expense incident to obtaining stockholder approval to increase the authorized share capital (Proposal 5).

 

(e)

Amendment and Restatement of the Digital World Charter – Conditioned on the approval of Proposals 2 through 5, a proposal to approve the proposed Amended Charter in the form attached as Annex B hereto, which includes the approval of all other changes in the proposed charter in connection with replacing the existing Digital World Charter with the proposed Amended Charter as of the Effective Time (Proposal 6).

3) The Director Election Proposal (Proposal 7)

To consider and vote upon a proposal to elect seven (7) directors to serve on the Combined Entity’s Board, each effective from the consummation of the Business Combination and for a term as set forth under the proposed Amended Charter or until such director’s earlier death, resignation, retirement or removal (Proposal 7).

4) The Incentive Plan Proposal (Proposal 8)

Digital World is proposing that its stockholders approve and adopt the Equity Incentive Plan, which will become effective upon the Closing.

The Equity Incentive Plan will reserve shares of New Digital World common stock equal to 7.5% of the fully diluted, and as converted, amount of New Digital World common stock to be outstanding immediately following consummation of the Business Combination, taking into account any additional shares that may be issued pursuant to the Earnout Shares. The purpose of the Equity Incentive Plan is to assist in attracting, retaining, motivating, and rewarding certain key employees, officers, directors, and consultants of New Digital World and its affiliates and promoting the creation of long-term value for stockholders of New Digital World by closely aligning the interests of such individuals with those of other stockholders. The Equity Incentive Plan authorizes the award of share-based incentives to encourage eligible employees, officers, directors, and consultants, as described below, to expend maximum effort in the creation of stockholder value.

A summary of the Equity Incentive Plan is set forth in the “The Incentive Plan Proposal (Proposal 8)” section of this proxy statement/prospectus and a complete copy of the Equity Incentive Plan is attached hereto as Annex C. You are encouraged to read the Equity Incentive Plan in its entirety.

5) The Nasdaq Proposal (Proposal 9)

To consider and vote upon a proposal to approve, for purposes of complying with Nasdaq Listing Rule 5635, (a) the issuance of up to 127,500,000 newly issued shares of New Digital World common stock in the Business Combination, which amount will be determined as described in more detail in the accompanying proxy statement/prospectus, (b) the issuance, if any, of up to 7,981,645 shares of New Digital World common stock in connection with the conversion of any Digital World Convertible Notes and Digital World Alternative Financing Notes entered into prior to the consummation of the Business Combination, (c) the issuance, if any, of up to 6,552,134 shares of New Digital World common stock in connection with the exercise of Post-IPO Warrants, (d) the issuance of up to 8,369,509 shares of New Digital World common stock issuable upon conversion of outstanding TMTG Convertible Notes immediately prior to the Effective Time in connection with the Closing and (e) the issuance under the Equity Incentive Plan of shares of New Digital World common stock equal to 7.5% of the fully diluted, and as converted, amount of New Digital World common stock to be outstanding immediately following consummation of the Business Combination, taking into account any additional shares that may be issued pursuant to the Earnout Shares.

 

14

6) The Adjournment Proposal (Proposal 10)

To consider and vote upon a proposal to adjourn the Digital World Special Meeting to a later date or dates, if necessary, to permit further solicitation and vote of proxies if, based upon the tabulated vote at the time of the Digital World Special Meeting, there are not sufficient votes to approve the Business Combination Proposal, the Charter Amendment Proposals, the Director Election Proposal, the Incentive Plan Proposal or the Nasdaq Proposal.

 

Q:	When and where will the Digital World Special Meeting take place?

 

A:	The Digital World Special Meeting will be held on     , 2024, at 10:00 a.m., Eastern Time, via live audio webcast at      or such other date, time and place to which such meeting may be adjourned or postponed, to consider and vote upon the Proposals.

 

Q:	Are the Proposals conditioned on one another?

 

A:

Unless the Business Combination Proposal is approved, the Charter Amendment Proposals, the Director Election Proposal, the Incentive Plan Proposal, and the Nasdaq Proposal will not be presented to the stockholders of Digital World at the Digital World Special Meeting, insofar as the Charter Amendment Proposals, the Director Election Proposal, the Incentive Plan Proposal and the Nasdaq Proposal are conditioned on the approval of the Business Combination Proposal (and each such Proposal is cross-conditioned on the approval of all Required Proposals). The Adjournment Proposal is not conditioned on the approval of any other proposal set forth in this proxy statement/prospectus. It is important for you to note that if the Business Combination Proposal does not receive the requisite vote for approval, we will not consummate the Business Combination. If Digital World does not consummate the Business Combination and fails to complete an initial business combination by September 8, 2024, Digital World will be required, in accordance with the Digital World Charter, to dissolve and liquidate its Trust Account by returning the then remaining funds in such account (less amounts released to pay tax obligations and up to $100,000 for dissolution expenses, and amounts paid pursuant to Redemptions) to its Public Stockholders, unless it seeks and obtains again the approval of Digital World stockholders to amend the Digital World Charter to extend such date.

 

Q:	What will happen in the Business Combination?

 

A:

At the Closing, Merger Sub will merge with and into TMTG, with TMTG surviving such Merger, as a result of which (a) all of the issued and outstanding TMTG common stock immediately prior to the Effective Time (other than those properly exercising any applicable appraisal rights under Delaware law or any shares of TMTG common stock issued upon the conversion of TMTG Convertible Notes immediately prior to the Effective Time pursuant to the terms of the Merger Agreement) will automatically be cancelled and will cease to exist, in exchange for the right to receive their pro rata portion of the Merger Consideration and the Earnout Shares, if any, (b) all of the issued and outstanding common stock of TMTG immediately prior to the Effective Time that was issued upon the conversion of TMTG Convertible Notes pursuant to the terms of the Merger Agreement will automatically be cancelled and will cease to exist, in exchange for the right to receive shares of New Digital World common stock upon the terms set forth in the Merger Agreement, (c) each outstanding option to acquire shares of TMTG common stock (whether vested or unvested) will be assumed by New Digital World and automatically converted into an option to acquire shares of New Digital World common stock, with its price and number of shares equitably adjusted based on the conversion ratio of the shares of TMTG common stock into the Merger Consideration, and (d) each outstanding restricted stock unit of TMTG shall be converted into a restricted stock unit relating to shares of New Digital World common stock. Upon consummation of the Business Combination, TMTG will become a wholly owned subsidiary of Digital World and Digital World will change its name to Trump Media & Technology Group Corp. After the Closing, the cash held in the Trust Account will be released from the Trust Account and

 

15

used to pay each of Digital World’s and TMTG’s transaction expenses and other liabilities of Digital World due as of the Closing, and for working capital and general corporate purposes of the Combined Entity. A copy of the Merger Agreement is attached to this proxy statement/prospectus as Annex A.

 

Q:	What equity stake will current stockholders of Digital World, including anchor investors and TMTG securityholders and convertible noteholders hold in the Combined Entity after the Closing?

 

A:

It is anticipated that, upon the completion of the Business Combination, Digital World’s Public Stockholders will retain an ownership interest of approximately 21.2% of the outstanding capital stock of the Combined Entity, the Sponsor will retain an ownership interest of approximately 7.8% of the outstanding capital stock of the Combined Entity and holders of TMTG securities will own approximately 72.0% of the outstanding capital stock of the Combined Entity.

The foregoing ownership percentages with respect to the Combined Entity following the Business Combination (a) exclude the exercise of outstanding Warrants and the conversion of securities issued in the Post-IPO Financings and (b) assume that (i) there are no Redemptions of any shares by Digital World’s Public Stockholders in connection with the Business Combination and (ii) no awards are issued under the Equity Incentive Plan. If the actual facts are different than these assumptions (which they are likely to be), the percentage ownership retained by Digital World’s existing stockholders in the Combined Entity will be different.

 

16

If any of Digital World’s Public Stockholders exercise their Redemption Rights, the percentage of the Combined Entity’s outstanding common stock held by Digital World’s Public Stockholders will decrease and the percentages of the Combined Entity’s outstanding common stock held by the Sponsor and by the holders of TMTG securities will increase, in each case relative to the percentage held if none of the Public Shares are redeemed. Upon the issuance of New Digital World common stock in connection with the Business Combination, the percentage ownership of the Combined Entity by Digital World’s Public Stockholders who do not redeem their Public Shares will be diluted. Digital World Public Stockholders that do not redeem their Public Shares in connection with the Business Combination will experience further dilution upon the exercise of Public Warrants that are retained after the Closing by redeeming Public Stockholders. The percentage of the total number of outstanding shares of New Digital World common stock that will be owned by Digital World’s Public Stockholders as a group will vary based on the number of Public Shares for which the holders thereof request Redemption in connection with the Business Combination and the number of shares of common stock issued upon conversion of the Preferred Stock (if any). The following table illustrates varying beneficial ownership levels in the Combined Entity, as well as possible sources and extent of dilution for non-redeeming Public Stockholders, excluding the conversion of the shares of Preferred Stock and assuming no Redemptions by Public Stockholders, 33.3% Redemption by Public Stockholders, 50% Redemption by Public Stockholders, and the maximum (77%) Redemptions by Public Stockholders:

 

		Minimum Redemption								33.33% Redemption								50% Redemption								Maximum (77%) Redemption (1)
Digital World
SPAC public shareholder shares			28,745,952				21.2	%			19,164,926				15.2	%			14,372,976				11.9	%			6,744,940				5.9	%
SPAC private placement shares			1,133,484				0.8	%			1,133,484				0.9	%			1,133,484				0.9	%			1,133,484				1.0	%
Underwriter IPO shares			143,750				0.1	%			143,750				0.1	%			143,750				0.1	%			143,750				0.1	%
SPAC sponsor promote (primarily Founder Shares)			9,631,250				7.1	%			9,631,250				7.6	%			9,631,250				7.9	%			9,631,250				8.5	%
Total Digital World			39,654,436				29.3	%			30,073,410				23.9	%			25,281,460				20.9	%			17,653,424				15.6	%
TMTG
Rollover equity shares for TMTG shareholders			87,500,000				64.6	%			87,500,000				69.5	%			87,500,000				72.2	%			87,500,000				77.1	%
TMTG convertible note shares			8,369,509				6.2	%			8,369,509				6.6	%			8,369,509				6.9	%			8,369,509				7.4	%
Total TMTG			95,869,509				70.7	%			95,869,509				76.1	%			95,869,509				79.1	%			95,869,509				84.4	%
Total			135,523,945				100.0	%			125,942,919				100.0	%			121,150,969				100.0	%			113,522,933				100.0	%

 

(1)

Digital World is required to have at least $5,000,001 in net tangible assets and $60 million in cash upon the closing of the Business Combination (the “Financial Closing Conditions”). The ability to meet the Financial Closing Conditions will not be known until the level of redemptions of Public Shares in connection with the Business Combination is known. As a result, if redemptions exceed $234.3 million (or 77% of the Trust Account assets before redemptions) the Business Combination would not close. As such, the Maximum Redemption scenario does not reflect the full amount of Public Shares that may be redeemed under Digital World’s Charter. Accordingly, if holders of more than 22,001,012 Public Shares seek to exercise such Redemption Rights, the Business Combination is not expected to close.

All of the relative percentages above are for illustrative purposes only and are based upon certain assumptions. See the section titled “Unaudited Pro Forma Condensed Combined Financial Information” for further information.

 

17

Should one or more of the assumptions prove incorrect, actual beneficial ownership percentages may vary materially from those described in this proxy statement/prospectus as anticipated, believed, estimated, expected or intended.

 

Q:	What conditions must be satisfied to complete the Business Combination?

 

A:

There are a number of closing conditions in the Merger Agreement, including the approval by the stockholders of Digital World of the Business Combination Proposal, the Charter Amendment Proposals, the Director Election Proposal, the Incentive Plan Proposal and the Nasdaq Proposal. The Charter Amendment Proposals, the Director Election Proposal, the Incentive Plan Proposal and the Nasdaq Proposal are subject to and conditioned on the approval of the Business Combination Proposal. The Business Combination Proposal is subject to and conditioned on the approval of the Charter Amendment Proposals, the Director Election Proposal, the Incentive Plan Proposal and the Nasdaq Proposal. For a summary of the conditions that must be satisfied or waived prior to the Closing, see the section titled “The Business Combination Proposal (Proposal 1) — The Merger Agreement.”

 

Q:	Why is Digital World providing stockholders with the opportunity to vote on the Business Combination?

 

A:

Under the Digital World Charter, Digital World must provide all holders of its Public Shares with the opportunity to have their Public Shares redeemed upon the consummation of Digital World’s initial business combination either in conjunction with a tender offer or in conjunction with a stockholder vote. As such, Digital World has elected to provide its stockholders with the opportunity to have their Public Shares redeemed in connection with a stockholder vote rather than a tender offer. Therefore, Digital World is seeking to obtain the approval of its stockholders of the Business Combination Proposal in order to allow its Public Stockholders to effectuate Redemptions of their Public Shares in connection with the Closing.

 

Q:	Did the Digital World Board obtain a fairness opinion or a third-party valuation in determining whether or not to proceed with the Business Combination?

 

A:

The Digital World Board did not obtain a fairness opinion. However, given the duration of time between the initial execution of the Merger Agreement and the Second Amendment to the Agreement as well as the significant turnover on the Digital World Board since the Merger Agreement was first signed in 2021, during December 2023 in connection with exercising its fiduciary duties, the Board sought to refresh and complete its financial and business due diligence of TMTG, including with respect to the revised transaction terms contemplated by the Second Amendment to the Agreement. In reaching its determination and in support of its decision that the Business Combination and the other transactions contemplated by the Merger Agreement, including the Merger Consideration and the Earnout Shares, are fair and in the best interests of Digital World and its stockholders, the Digital World Board conducted a bring-down evaluation of TMTG’s business model, financial performance, growth opportunities and competitive positioning. As part of this evaluation process, the Digital World Board engaged an independent advisor to prepare a Comparable Company Analysis. The Comparable Company Analysis was based on certain publicly traded companies selected by Digital World’s management and the Digital World Board, which included Meta, X (formerly Twitter), Snapchat and Pinterest. However, while these companies may share certain characteristics that are similar to TMTG, the Digital World Board did not consider any of these companies to be identical in nature to TMTG, given its affiliation with former President Trump and unique market positioning, including purposeful differentiation from the current market offerings considered in its analysis. The Comparable Company Analysis was only one element of a broader due diligence process conducted by the Digital World Board, and the independent advisor was neither engaged for nor delivered a fairness opinion or other independent conclusion with respect to the terms of the Second Amendment to the Agreement. See “The Business Combination Proposal (Proposal 1) — The Board’s Reasons for Approval of the Business Combination.”

 

18

Q:	Are there any arrangements to help ensure that Digital World will have sufficient funds, together with the proceeds in its Trust Account, to consummate the Business Combination?

 

A:

Yes. On February 8, 2024, Digital World entered into subscription agreements with certain institutional investors for the issuance of the Digital World Alternative Financing Notes. Through the initial draw of such Digital World Alternative Financing Notes, on February 8, 2024, Digital World issued $10,000,000 to such institutional investors, and expects to issue the remaining up to $40,000,000 concurrently with the closing of the Business Combination (the “Final Drawdown”). The proceeds of such Final Drawdown will be deposited into an account subject to an account control agreement with a U.S. banking institution and such proceeds will be automatically released to New Digital World upon the filing of a resale registration statement with the SEC covering the underlying New Digital World common stock issuable upon conversion of the Digital World Alternative Financing Notes. Accordingly, as of the date of this proxy statement/prospectus and subject to Digital World’s compliance with its contractual obligations under the Digital World Alternative Financing Notes, Digital World expects, that together with the proceeds of the Final Drawdown and the Trust Account, it will have sufficient funds to satisfy the (i) $60,000,000 minimum liquidity condition under the Merger Agreement, and (ii) $5,000,001 minimum net tangible assets condition immediately prior to or upon consummation of the Business Combination. However, if Redemptions exceed 77%, Digital World may be unable to meet these conditions to the Closing in the absence of new sources of financing.

 

Q:	How many votes do I have at the Digital World Special Meeting?

 

A:

Digital World stockholders are entitled to one vote at the Digital World Special Meeting for each share of Digital World common stock held of record as of     , 2024, the record date for the Digital World Special Meeting (the “Record Date”). Each share of our Class A common stock and Class B common stock is entitled to one vote on each matter that comes before the Digital World Special Meeting. As of the close of business on the Record Date, there were 37,180,331 outstanding shares of Digital World common stock.

 

Q:	What vote is required to approve the Proposals presented at the Digital World Special Meeting?

 

A:

The approval of the Charter Amendment Proposals requires the affirmative vote in person (which would include presence at a virtual meeting) or by proxy of the holders, as of the Record Date, of a majority of the then issued and outstanding shares of Class A common stock and Class B common stock, voting together as a single class. Accordingly, a Digital World stockholder’s failure to vote by proxy or to vote in person at the Digital World Special Meeting or an abstention will have the same effect as a vote “AGAINST” the Charter Amendment Proposals.

The approval of the Business Combination Proposal, the Incentive Plan Proposal and the Nasdaq Proposal requires the affirmative vote in person (which would include presence at a virtual meeting) or by proxy of the holders, as of the Record Date, of a majority of the votes cast of Class A common stock and Class B common stock, voting together as a single class, entitled to vote thereon at the Digital World Special Meeting.

The approval of the Director Election Proposal requires a plurality vote of the shares of Digital World common stock cast by the stockholders represented in person or by proxy and entitled to vote thereon at the Digital World Special Meeting.

The approval of the Adjournment Proposal requires the affirmative vote of a majority of the votes cast by the stockholders represented in person or by proxy and entitled to vote thereon at the Digital World Special Meeting.

A Digital World stockholder’s failure to vote by proxy or to vote in person at the Digital World Special Meeting will not be counted towards the number of shares of Digital World common stock required to validly establish a quorum, and if a valid quorum is otherwise established, it will have no effect on the outcome of the vote on the Business Combination Proposal, the Incentive Plan Proposal, the Nasdaq

 

19

Proposal or the Adjournment Proposal. Abstentions will be counted towards the number of shares of Digital World common stock required to validly establish a quorum but will have no effect on the outcome of the vote on the Business Combination Proposal, the Incentive Plan Proposal, the Nasdaq Proposal or the Adjournment Proposal.

The approval of the Director Election Proposal requires a plurality vote of the shares of Digital World common stock cast by the stockholders represented in person or by proxy and entitled to vote thereon at the Digital World Special Meeting. A plurality means that the individuals who receive the largest number of votes cast “FOR” are elected as directors. A Digital World stockholder’s failure to vote by proxy or to vote in person at the Digital World Special Meeting will have no effect on the Director Election Proposal. You may vote “FOR” or “WITHHOLD” authority to vote for each of the director nominees with respect to the Director Election Proposal. “WITHHOLD” votes will be counted towards the number of shares of Digital World common stock required to validly establish a quorum but will have no effect on the outcome of the vote on the Director Election Proposal.

If the Business Combination Proposal is not approved, the Charter Amendment Proposals, the Director Election Proposal, the Incentive Plan Proposal and the Nasdaq Proposal will not be presented to the Digital World stockholders for a vote. The approval of the Business Combination Proposal, the Charter Amendment Proposals, the Director Election Proposal, the Incentive Plan Proposal and the Nasdaq Proposal are preconditions to the consummation of the Business Combination.

 

Q:	What constitutes a quorum at the Digital World Special Meeting?

 

A:

Holders of a majority in voting power of Digital World common stock issued and outstanding and entitled to vote at the Digital World Special Meeting constitute a quorum. In the absence of a quorum, the chairman of the meeting has power to adjourn the Digital World Special Meeting. As of the Record Date,      shares of Digital World common stock would be required to achieve a quorum.

 

Q:	How will the Sponsor, directors, officers and anchor investors of Digital World vote?

 

A:

The Sponsor, directors, officers and the anchor investors of Digital World have agreed to vote any Founder Shares and Placement Shares they may hold, as applicable, in favor of the Business Combination, including the Business Combination Proposal and the other Proposals. The Sponsor and all of our current and former directors and officers are expected to vote any Digital World common stock over which they have voting control (including any Public Shares owned by them) in favor of the Business Combination and the other Proposals. Currently, our Sponsor and certain current and former officers and directors own approximately 3.8% of our issued and outstanding shares of Class A common stock, and 76.5% of our issued and outstanding Founder Shares (including 5,497,500 Founder Shares and 1,133,484 Placement Units). Our Sponsor and current directors and officers do not intend to purchase shares of Digital World Class A common stock in the open market or in privately negotiated transactions in connection with the stockholder vote on the Business Combination.

The approval of the Business Combination Proposal requires the affirmative vote in person (which would include presence at a virtual meeting) or by proxy of the holders, as of the Record Date, of a majority of the votes cast of Class A common stock and Class B common stock, voting together as a single class, entitled to vote thereon at the Digital World Special Meeting. As each Proposal is cross-conditioned on the approval of all Required Proposals, the approval of the Business Combination Proposal is also conditioned on the approval of the Charter Amendment Proposals. The approval of the Charter Amendment Proposals requires the affirmative vote in person (which would include presence at a virtual meeting) or by proxy of the holders, as of the Record Date, of a majority of the then issued and outstanding shares of Class A common stock and Class B common stock, voting together as a single class. Consequently, the affirmative vote of approximately 55.3% of the unaffiliated issued and outstanding shares of Class A common stock, along with the affirmative vote of all of the issued and outstanding shares of Class A common stock and Class B

 

20

common stock held by the Sponsor, certain of our current and former directors, officers and the anchor investors, is required to approve the Charter Amendment Proposals.

 

Q:	What interests do Digital World’s current officers and directors have in the Business Combination?

 

A:

Eric Swider will remain as a director of the Combined Entity following the Business Combination. None of the Sponsor or current officers or directors of Digital World will receive any interest in the Business Combination other than the interests they owned prior to the Business Combination or as described below in “Risk Factors” and “The Business Combination Proposal (Proposal 1) — Interests of Digital World’s Directors and Officers in the Business Combination.” The interests of the Sponsor or current officers or directors of Digital World may be different from or in addition to (and which may conflict with) your interest. These interests include:

 

•

that unless Digital World consummates an initial business combination, Digital World’s officers and directors and the Sponsor will not receive reimbursement for any out-of-pocket expenses incurred by them to the extent that such expenses exceed the amount of available proceeds not deposited in the Trust Account.

 

•

the fact that our Sponsor holds 5,490,000 Founder Shares and 1,133,484 Placement Units, all such securities beneficially owned by Patrick Orlando, a director and former Chairman and Chief Executive Officer. In addition, Mr. Eric Swider, our Chief Executive Officer and a director, owns 7,500 Founder Shares; and the anchor investors own the remaining 1,650,000 Founder Shares. All of such investments would expire worthless if a business combination is not consummated; on the other hand, if an initial business combination is consummated, such investments could earn a positive rate of return on their overall investment in the Combined Entity even if other holders of our common stock experience a negative rate of return, due to each of the Sponsor and such individual anchor investors having initially purchased their respective Founder Shares for $25,000.

 

•

that as a condition to the Digital World IPO, the Founder Shares became subject to a lock-up whereby, subject to certain limited exceptions, the Founder Shares cannot be transferred until the earlier of (A) six months after the completion of Digital World’s initial business combination, (B) subsequent to Digital World’s initial business combination, when the reported last sale price of the Class A common stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing at

least 150 days after Digital World’s initial business combination and (C) such date after its initial business combination on which Digital World completes a liquidation, merger, stock exchange, reorganization or other similar transaction that results in all of the Digital World stockholders having the right to exchange their shares of Digital World common stock for cash, securities or other property.

 

•

that an aggregate of 1,133,484 Placement Units were issued to the Sponsor simultaneously with the consummation of the IPO and the underwriters’ exercise of their over-allotment option. Such Units had an aggregate market value of approximately $60.1 million based upon the closing price of Digital World’s Public Units of $53.00 per Unit on Nasdaq on February 9, 2024.

 

•

that the Sponsor has agreed that the Placement Units, and all of their underlying securities, will not be sold or transferred by it until 30 days after Digital World has completed an initial business combination, subject to limited exceptions.

 

•

that the Sponsor and directors and officers of Digital World have agreed not to redeem any shares of Digital World common stock they hold in connection with a stockholder vote to approve an initial business combination.

 

•

that the Sponsor may loan to Digital World additional funds for working capital purposes prior to the Business Combination. As of the date of this proxy statement/prospectus, there were $4,000,700 outstanding in Digital World Convertible Notes due to our Sponsor. If the Business Combination is not

 

21

consummated and Digital World does not otherwise consummate another business combination prior to September 8, 2024, then there will likely be insufficient funds to pay the Digital World Convertible Notes.

 

•

the fact that on June 2, 2023, the Company issued two promissory notes to Renatus LLC (“Renatus”) in the aggregate principal amounts of (a) $2,000,000 and (b) $10,000,000. As of the date of this proxy statement/prospectus there were $1,232,000 outstanding in Digital World Convertible Notes due to Renatus, the proceeds of which are being used to pay working capital costs and expenses to enable Digital World to continue operating and complete an initial business combination. Mr. Swider is a founder and partner of Renatus.

 

•

that if Digital World does not complete an initial business combination by September 8, 2024, the 1,133,484 shares of Class A common stock underlying the Placement Units, the 566,742 shares of Class A common stock issuable upon conversion of the Placement Warrants and the 7,187,500 Founder Shares, of which 5,537,500 Founder Shares are held by Digital World’s Sponsor and certain current and former directors and officers, would be worthless because they are not entitled to participate in any Redemption or distribution with respect to such shares. Such Founder Shares and Placement Units had an aggregate market value of $338.0 million and $380.9 million, respectively, as of February 9, 2024, based on the closing price per Class A common stock of Digital World as of February 9, 2024 of $47.03 per share and the closing price of Digital World’s Public Units of $53.00 per Unit on Nasdaq on February 9, 2024.

 

•

that if the Trust Account is liquidated, including in the event Digital World is unable to complete an initial business combination within the required time period, the Sponsor has agreed to indemnify Digital World to ensure that the proceeds in the Trust Account are not reduced below $10.20 per Public Share by the claims of prospective target businesses with which Digital World has entered into an acquisition agreement or claims of any third party for services rendered or products sold to Digital World, but only if such a vendor or target business has not executed a waiver of any and all rights to seek access to the Trust Account.

 

•

that the Sponsor (including its representatives and affiliates) and Digital World’s directors and officers, are, or may in the future become, affiliated with entities that are engaged in a similar business to Digital World. The Sponsor and Digital World’s directors and officers are not prohibited from sponsoring, or otherwise becoming involved with, any other blank check companies prior to Digital World completing its initial business combination. Digital World’s directors and officers also may become aware of business opportunities which may be appropriate for presentation to Digital World, and the other entities to which they owe certain fiduciary or contractual duties. Accordingly, they may have conflicts of interest in determining to which entity a particular business opportunity should be presented. These conflicts may not be resolved in Digital World’s favor and such potential business opportunities may be presented to other entities prior to their presentation to Digital World, subject to applicable fiduciary duties under DGCL. Digital World Charter provides that Digital World renounces its interest in any corporate opportunity offered to any director or officer unless such opportunity is expressly offered to such person solely in his or her capacity as a director or officer of Digital World and such opportunity is one Digital World is legally and contractually permitted to undertake and would otherwise be reasonable for Digital World to pursue, and to the extent the director or officer is permitted to refer that opportunity to Digital World without violating another legal obligation.

 

•

that Mr. Swider is expected to be appointed as a director of the Combined Entity after the consummation of the Business Combination, Mr. Swider may in the future receive cash fees, stock options or stock awards that the Combined Entity determines to pay to its directors.

 

•

that Digital World has issued Digital World Convertible Notes to certain officers, directors and affiliates pursuant to the convertible note compensation plan (the “Convertible Note Compensation Plan”), approved by the requisite holders of Class A common stock at the annual meeting of Digital World’s stockholders on December 19, 2023. These notes collectively represent an aggregate amount of $9,651,250 and may be convertible upon the Closing of the Business Combination into a maximum

 

22

of 965,125 shares of Class A common stock, assuming each recipient chooses to convert their entire promissory note amount into Class A common shares. If we fail to close the Business Combination such notes would then be worthless. See the section entitled “Digital World’s Management — Officer and Director Compensation — Equity Incentive Compensation.”

These interests may influence Digital World’s directors in making their recommendation that you vote in favor of the approval of the Business Combination.

 

Q:	What interests do TMTG’s current officers and directors have in the Business Combination?

 

A:	Members of the TMTG Board and its executive officers have interests in the Business Combination that may be different from or in addition to (and which may conflict with) your interest. These interests include, without limitation, the following:

 

•

Devin Nunes, Chief Executive Officer of TMTG, who currently serves on the TMTG Board, may serve as a director of the Combined Entity after consummation of the Business Combination and TMTG may nominate one or more of its existing directors to serve on the Board of the Combined Entity;

 

•

Upon consummation of the Business Combination, and subject to certain conditions, certain TMTG executive officers may be eligible to receive a retention bonus of up to $600,000 each for an aggregate amount of up to $1,800,000;

 

•

Upon consummation of the Business Combination, any outstanding TMTG Options and TMTG RSUs, if any, granted to TMTG’s executive officers and certain members of the TMTG Board under the TMTG 2022 Plan prior to the Closing of the Business Combination will be assumed and converted to options and RSUs under the Equity Incentive Plan effective as of the Closing the Business Combination; and

 

•

Upon consummation of the Business Combination, and subject to approval of the Incentive Plan Proposal, TMTG’s executive officers and directors are expected to receive grants of stock options and/or restricted stock units under the Equity Incentive Plan from time to time as determined by the compensation committee of the Combined Entity (the “Compensation Committee”).

 

•

Upon consummation of the Business Combination, and subject to approval of the Charter Amendment Proposals, the TMTG securityholders are expected to control a majority of the voting power of the outstanding New Digital World common stock, with President Trump beneficially owning at least 58.1% of the voting power of such New Digital World common stock. As a result, New Digital World will then be a “controlled company” within the meaning of applicable rules of the Nasdaq upon the Closing.

Please see the sections entitled “Risk Factors” and “The Business Combination Proposal (Proposal 1) — Interests of TMTG’s Directors and Officers in the Business Combination” and “Executive and Director Compensation of TMTG” of this proxy statement/prospectus for a further discussion of these and other interests.

 

Q:	What happens if I sell my shares of Class A common stock before the Digital World Special Meeting?

 

A:

The Record Date is earlier than the date of the Digital World Special Meeting. If you transfer your shares of Class A common stock after the Record Date, but before the Digital World Special Meeting, unless the transferee obtains from you a proxy to vote those shares, you will retain your right to vote at the Digital World Special Meeting. However, you will not be able to seek Redemption of your shares because you will no longer be able to deliver them for cancellation upon consummation of the Business Combination in accordance with the provisions described herein. If you transfer your shares of Class A common stock prior to the Record Date, you will have no right to vote those shares at the Digital World Special Meeting.

 

23

Q:	What happens if a substantial number of the Public Stockholders vote in favor of the Business Combination and exercise their Redemption right?

 

A:

Digital World stockholders who vote in favor of the Business Combination may also nevertheless exercise their Redemption Rights. Accordingly, the Business Combination may be consummated even though the funds available from the Trust Account and the number of Public Stockholders are reduced as a result of Redemptions by Public Stockholders. Nonetheless, the consummation of the Business Combination is conditioned upon Digital World being able to fulfill the Financial Closing Conditions, as described herein. See “Questions and Answers — What equity stake will current stockholders of Digital World, including anchor investors and TMTG securityholders and convertible noteholders hold in the Combined Entity after the Closing?” In addition, with fewer Public Shares and Public Stockholders, the trading market for the Combined Entity’s stock may be less liquid than the market for Digital World common stock was prior to consummation of the Business Combination and the Combined Entity may not be able to meet the listing standards for Nasdaq. In addition, with less funds available from the Trust Account, the working capital infusion from the Trust Account into TMTG’s business will be reduced. As a result, the proceeds will be greater in the event that no Public Stockholders exercise Redemption Rights with respect to their Public Shares for a pro rata portion of the Trust Account as opposed to the scenario in which Digital World’s Public Stockholders exercise the maximum allowed Redemption Rights.

 

Q:	What happens if I vote against any of the Business Combination Proposal, the Charter Amendment Proposals, the Director Election Proposal, the Incentive Plan Proposal or the Nasdaq Proposal?

 

A:

If any of the Required Proposals are not approved, the Business Combination is not consummated and Digital World does not otherwise consummate an alternative business combination by September 8, 2024, pursuant to the Digital World Charter, Digital World will be required to dissolve and liquidate its Trust Account by returning the then remaining funds in such account to the Public Stockholders, unless (in the event the Business Combination is not consummated by September 8, 2024) Digital World seeks and obtains the consent of its stockholders to amend the Digital World Charter to extend the date by which it must consummate its initial business combination (an “Extension”).

 

Q:	Do I have Redemption Rights in connection with the Business Combination?

 

A:

Pursuant to the Digital World Charter, holders of Public Shares may elect to have their shares redeemed for cash at the applicable Redemption price per share calculated in accordance with the Digital World Charter. For illustrative purposes, as of February 8, 2024, based on funds in the Trust Account of $312,083,428.12 as of such date, the pro rata portion of the funds available in the Trust Account for the Redemption of Public Shares of Digital World Class A common stock was approximately $10.85 per share. If a holder exercises its Redemption Rights, then such holder will be exchanging its Class A common stock for cash and will only have equity interests in the Combined Entity pursuant to the exercise of its Public Warrants, to the extent it still holds Public Warrants. Such a holder will be entitled to receive cash for its Public Shares only if it properly demands Redemption and delivers its shares (either physically or electronically) to Digital World’s transfer agent prior to the Digital World Special Meeting. See the section titled “The Digital World Special Meeting — Redemption Rights” for the procedures to be followed if you wish to redeem your shares for cash.

 

Q:	Will how I vote affect my ability to exercise Redemption Rights?

 

A:

No. You may exercise your Redemption Rights whether or not you attend or vote your shares of Digital World common stock at the Digital World Special Meeting, and regardless of how you vote your shares. As a result, the Merger Agreement and the Required Proposals can be approved by stockholders who will redeem their shares and no longer remain stockholders, leaving stockholders who choose not to redeem their shares holding shares in a company with a potentially less liquid trading market, fewer stockholders, potentially less cash and the potential inability to meet the listing standards of Nasdaq.

 

24

Q:	How do I exercise my Redemption Rights?

 

A:

In order to exercise your Redemption Rights, you must, prior to 5:00 p.m., Eastern Time, on     , 2024 (two (2) business days before the Digital World Special Meeting), tender your shares physically or electronically and submit a request in writing that we redeem your Public Shares for cash to Continental Stock Transfer & Trust Company, our transfer agent, at the following address:

Continental Stock Transfer & Trust Company

One State Street Plaza, 30^th Floor

New York, New York 10004

Attn: Mark Zimkind

E-mail: mzimkind@continentalstock.com

Please also affirmatively certify in your request to Continental Stock Transfer & Trust Company for Redemption if you “ARE” or “ARE NOT” acting in concert or as a “group” (as defined in Section 13(d)(3) of the Exchange Act) with any other stockholder with respect to shares of Class A common stock. A holder of the Public Shares, together with any affiliate of his or any other person with whom he is acting in concert or as a “group” (as defined in Section 13(d)(3) of the Exchange Act) will be restricted from seeking Redemption Rights with respect to more than an aggregate of 15% of the Public Shares, which we refer to as the “15% threshold,” without the prior consent of Digital World. Accordingly, all Public Shares in excess of the 15% threshold beneficially owned by a Public Stockholder or group will not be redeemed for cash.

Stockholders seeking to exercise their Redemption Rights and opting to deliver physical certificates should allot sufficient time to obtain physical certificates from the transfer agent and time to effect delivery. It is Digital World’s understanding that stockholders should generally allot at least two weeks to obtain physical certificates from the transfer agent. However, Digital World does not have any control over this process and it may take longer than two weeks. Stockholders who hold their shares in street name will have to coordinate with their bank, broker or other nominee to have the shares certificated or delivered electronically.

Any demand for Redemption, once made, may be withdrawn at any time until the deadline for exercising Redemption requests and thereafter, with Digital World’s consent, until the vote is taken with respect to the Business Combination. If you delivered your shares for Redemption to Digital World’s transfer agent and decide within the required timeframe not to exercise your Redemption Rights, you may request that Digital World’s transfer agent return the shares (physically or electronically). You may make such request by contacting Digital World’s transfer agent at the phone number or address listed under the question “Who can help answer my questions?” below.

 

Q.	What are the U.S. federal income tax consequences of exercising my Redemption Rights?

 

A:

We expect that a U.S. holder (as defined herein) that exercises its Redemption Rights to receive cash from the Trust Account in exchange for its Public Shares will generally be treated as selling such Public Shares resulting in the recognition of capital gain or capital loss. There may be certain circumstances in which the Redemption may be treated as a distribution for U.S. federal income tax purposes depending on the amount of Public Shares that a U.S. holder owns or is deemed to own (including through the ownership of Public Warrants). For a more complete discussion of the U.S. federal income tax considerations of an exercise of Redemption Rights, see “The Business Combination Proposal (Proposal 1) — United States Federal Income Tax Considerations of the Redemption.”

TAX MATTERS ARE COMPLICATED, AND THE TAX CONSEQUENCES OF EXERCISING YOUR REDEMPTION RIGHTS WILL DEPEND ON THE FACTS OF YOUR OWN SITUATION. YOU SHOULD CONSULT YOUR OWN TAX ADVISOR AS TO THE SPECIFIC TAX CONSEQUENCES OF THE EXERCISE OF REDEMPTION RIGHTS TO YOU IN YOUR PARTICULAR CIRCUMSTANCES.

 

25

Q:	If I am a Warrant holder, can I exercise Redemption Rights with respect to my Warrants?

 

A:	No. The holders of Warrants have no Redemption Rights with respect to Warrants.

 

Q:	If I am a Public Unit holder, can I exercise Redemption Rights with respect to my Public Units?

 

A:	No. Holders of outstanding Public Units must separate the constituent Public Shares and Public Warrants prior to exercising Redemption Rights with respect to the Public Shares.

If you hold Public Units registered in your own name, you must deliver the certificate for such Public Units to Continental Stock Transfer & Trust Company, our transfer agent, with written instructions to separate such Public Units into Public Shares, and Public Warrants. This must be completed far enough in advance to permit the mailing of the Public Share certificates back to you so that you may then exercise your Redemption Rights upon the separation of the Public Shares from the Public Units. See “Questions and Answers — How do I exercise my Redemption Rights?” above. The address of Continental Stock Transfer & Trust Company is listed under the question “Who can help answer my questions?” below.

If a broker, dealer, commercial bank, trust company or other nominee holds your Public Units, you must instruct such nominee to separate your Public Units. Your nominee must send written instructions by facsimile to Continental Stock Transfer & Trust Company, Digital World’s transfer agent. Such written instructions must include the number of Public Units to be split and the nominee holding such Public Units. Your nominee must also initiate electronically, using The Depository Trust Company’s deposit withdrawal at custodian (DWAC) system, a withdrawal of the relevant Public Units and a deposit of an equal number of Public Shares and Public Warrants. This must be completed far enough in advance to permit your nominee to exercise your Redemption Rights upon the separation of the Public Shares from the Public Units. While this is typically done electronically the same business day, you should allow at least one full business day to accomplish the separation. If you fail to cause your Public Shares to be separated in a timely manner, you will likely not be able to exercise your Redemption Rights.

 

Q:	Do I have appraisal rights if I object to the proposed Business Combination?

 

A:	No. There are no appraisal rights available to holders of Digital World common stock in connection with the Business Combination.

 

Q:	What happens to the funds held in the Trust Account upon consummation of the Business Combination?

 

A:	If the Business Combination is consummated, the funds held in the Trust Account will be released to pay:

 

•

Digital World stockholders who properly exercise their Redemption Rights;

 

•

certain other fees, costs and expenses (including regulatory fees, legal fees, accounting fees, printer fees and other professional fees) that were incurred by Digital World or TMTG in connection with the transactions contemplated by the Business Combination and pursuant to the terms of the Merger Agreement;

 

•

any loans owed by Digital World to its Sponsor or affiliates for any Digital World transaction expenses, and other administrative expenses incurred by Digital World; and

 

•

for general corporate purposes including, but not limited to, working capital for operations.

Any remaining cash will be used for working capital and general corporate purposes of the Combined Entity.

 

26

Q:	What happens if the Business Combination is not consummated?

 

A:	There are certain circumstances under which the Merger Agreement may be terminated. See the section titled “The Business Combination Proposal (Proposal 1) — The Merger Agreement” for information regarding the parties’ specific termination rights.

If, as a result of the termination of the Merger Agreement or otherwise, Digital World is unable to complete the Business Combination or another initial business combination transaction by September 8, 2024, the Digital World Charter provides that it will (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible, subject to lawfully available funds therefor, redeem 100% of the Public Shares in consideration of a per-share price, payable in cash, equal to the quotient obtained by dividing (A) the aggregate amount then on deposit in the Trust Account, including interest earned on the funds held in the Trust Account and not previously released to it to pay taxes payable and up to $100,000 for dissolution expenses, by (B) the total number of then outstanding Public Shares, which Redemption will completely extinguish rights of the Public Stockholders (including the right to receive further liquidation distributions, if any), subject to applicable law, and (iii) as promptly as reasonably possible following such Redemptions, subject to the approval of the remaining stockholders and the Board in accordance with applicable law, dissolve and liquidate, subject (in the case of (ii) and (iii) above) to its obligations under the DGCL to provide for claims of creditors and other requirements of applicable law.

Digital World expects that the amount of any distribution its Public Stockholders will be entitled to receive upon its dissolution will be approximately the same as the amount they would have received if they had redeemed their shares in connection with the Business Combination, subject in each case to Digital World’s obligations under the DGCL to provide for claims of creditors and other requirements of applicable law. Holders of Founder Shares and Placement Shares have waived any right to any liquidation distribution with respect to those shares.

In the event of liquidation, there will be no distribution with respect to Digital World’s outstanding Warrants. Accordingly, the Warrants would then be worthless.

 

Q:	When is the Business Combination expected to be completed?

 

A:

The Closing is expected to take place (a) the second business day following the satisfaction or waiver of the conditions described below under the section titled “The Business Combination Proposal (Proposal 1) — The Merger Agreement — Conditions to the Closing,” or (b) such other date as agreed to by the parties to the Merger Agreement in writing, in each case, subject to the satisfaction or waiver of the Closing conditions. The Merger Agreement may be terminated by either Digital World or TMTG if the Closing has not occurred by December 31, 2023. For more information, see the section entitled “The Business Combination Proposal (Proposal 1) — The Merger Agreement — Termination.”

For a description of the conditions to the completion of the Business Combination, see the section titled “The Business Combination Proposal (Proposal 1).”

 

Q:	What do I need to do now?

 

A:

You are urged to read carefully and consider the information contained in this proxy statement/prospectus, including the annexes, and to consider how the Business Combination will affect you as a stockholder. You should then vote as soon as possible in accordance with the instructions provided in this proxy statement/prospectus and on the enclosed proxy card or, if you hold your shares through a brokerage firm, bank or other nominee, on the voting instruction form provided by the broker, bank or nominee.

 

Q:	How do I vote?

 

A:	If you are a stockholder of record of Digital World as of     , 2024, the Record Date, you may submit your proxy before the Digital World Special Meeting in any of the following ways, if available:

 

•

use the toll-free number shown on your proxy card;

 

27

•

visit the website shown on your proxy card to vote via the Internet; or

 

•

complete, sign, date and return the enclosed proxy card in the enclosed postage-paid envelope.

Stockholders who choose to participate in the Digital World Special Meeting can vote their shares electronically during the meeting via live audio webcast by visiting www.proxyvote.com. You will need the control number that is printed on your proxy card to enter the Digital World Special Meeting. Digital World recommends that you log in at least 15 minutes before the meeting to ensure you are logged in when the Digital World Special Meeting starts.

If your shares are held in “street name” through a broker, bank or other nominee, your broker, bank or other nominee will send you separate instructions describing the procedure for voting your shares. “Street name” stockholders who wish to vote at the Digital World Special Meeting will need to obtain a proxy form from their broker, bank or other nominee.

Beneficial stockholders who wish to attend the online-only virtual meeting must obtain a legal proxy by contacting their account representative at the bank, broker, or other nominee that holds their shares and e-mail a copy (a legible photograph is sufficient) of their legal proxy to proxy@continentalstock.com. Beneficial stockholders who e-mail a valid legal proxy will be issued a meeting control number that will allow them to register to attend and participate in the online-only meeting. After contacting Digital World’s transfer agent, a beneficial holder will receive an e-mail prior to the Digital World Special Meeting with a link and instructions for entering the virtual meeting. Beneficial stockholders should contact Digital World’s transfer agent at least five business days prior to the meeting date.

 

Q:	What will happen if I abstain from voting or fail to vote at the Digital World Special Meeting?

 

A:

At the Digital World Special Meeting, Digital World will count a properly executed proxy marked “ABSTAIN” with respect to a particular proposal or marked “WITHHOLD” with respect to the Director Election Proposal as present for purposes of determining whether a quorum is present. Abstentions will have the same effect as a vote “AGAINST” the Charter Amendment Proposals. Abstentions will have no effect on the Business Combination Proposal, the Incentive Plan Proposal, the Nasdaq Proposal or the Adjournment Proposal. “WITHHOLD” votes will have no effect on the Director Election Proposal.

A “broker non-vote” occurs when shares held by a broker for the account of a beneficial owner are not voted for or against a particular proposal because the broker has not received voting instructions from that beneficial owner and the broker does not have discretionary authority to vote those shares in the absence of such instructions. If you do not provide instructions to your broker, your broker will not have discretionary authority to vote on any of the Proposals at the Digital World Special Meeting, because Digital World does not expect any of the Proposals to be considered a routine matter. Broker non-votes will not be counted as present for the purposes of establishing a quorum.

Broker non-votes will have the same effect as a vote “AGAINST” the Charter Amendment Proposals. Broker non-votes will have no effect on the Business Combination Proposal, the Director Election Proposal, the Incentive Plan Proposal, the Nasdaq Proposal or the Adjournment Proposal.

 

Q:	What will happen if I sign and return my proxy card without indicating how I wish to vote?

 

A:

Signed and dated proxies received by Digital World without an indication of how the stockholder intends to vote on a proposal will be voted “FOR” each proposal presented to the stockholders. The proxyholders may use their discretion to vote on any other matters which properly come before the Digital World Special Meeting.

 

28

Q:	If I am not going to attend the Digital World Special Meeting in person, should I return my proxy card instead?

 

A:	Yes. Whether you plan to attend the Digital World Special Meeting or not, please read this entire proxy statement/prospectus, including the annexes, carefully, and vote your shares by completing, signing, dating and returning the enclosed proxy card in the postage-paid envelope provided.

 

Q:	If my shares are held in “street name,” will my broker, bank or nominee automatically vote my shares for me?

 

A:

No. Under the rules of various national and regional securities exchanges, your broker, bank or nominee cannot vote your shares with respect to non-discretionary matters unless you provide instructions on how to vote in accordance with the information and procedures provided to you by your broker, bank or nominee. Digital World believes the Proposals presented to the stockholders will be considered non-discretionary and therefore your broker, bank or nominee cannot vote your shares without your instruction. Your bank, broker or other nominee can vote your shares only if you provide instructions on how to vote. You should instruct your broker to vote your shares in accordance with directions you provide.

 

Q:	May I change my vote after I have mailed my signed proxy card?

 

A:

Yes. You may change your vote by sending a later-dated, signed proxy card to Digital World’s Chief Executive Officer at the address listed below so that it is received by Digital World’s Chief Executive Officer prior to the Digital World Special Meeting or attend the Digital World Special Meeting in person and vote. You also may revoke your proxy by sending a notice of revocation to Digital World’s Chief Executive Officer, which must be received by Digital World’s Chief Executive Officer prior to the Digital World Special Meeting.

 

Q:	What should I do if I receive more than one set of voting materials?

 

A:

You may receive more than one set of voting materials, including multiple copies of this proxy statement/prospectus and multiple proxy cards or voting instruction cards. For example, if you hold your shares in more than one brokerage account, you will receive a separate voting instruction card for each brokerage account in which you hold shares. If you are a holder of record and your shares are registered in more than one name, you will receive more than one proxy card. Please complete, sign, date and return each proxy card and voting instruction card that you receive in order to cast your vote with respect to all of your shares.

 

Q:	Who will solicit and pay the cost of soliciting proxies?

 

A:

Digital World will pay the cost of soliciting proxies for the Digital World Special Meeting. Digital World has engaged Alliance Advisors to assist in the solicitation of proxies for the Digital World Special Meeting. Digital World has agreed to pay a fee of up to $  , plus disbursements. Digital World will reimburse Alliance Advisors for reasonable out-of-pocket expenses and will indemnify Alliance Advisors and its affiliates against certain claims, liabilities, losses, damages and expenses. Digital World will also reimburse banks, brokers and other custodians, nominees and fiduciaries representing beneficial owners of shares of Digital World common stock for their expenses in forwarding soliciting materials to beneficial owners of the Digital World common stock and in obtaining voting instructions from those owners. Digital World’s directors, officers and employees may also solicit proxies by telephone, by facsimile, by mail, on the Internet or in person. They will not be paid any additional amounts for soliciting proxies.

 

29

Q:	Who can help answer my questions?

 

A:	If you have questions about the Proposals or if you need additional copies of this proxy statement/prospectus or the enclosed proxy card you should contact:

Eric Swider

Chief Executive Officer

3109 Grand Ave., #450

Miami, Florida 33133

(305) 735-1517

You may also contact our proxy solicitor, Alliance Advisor, at 877-728-4996 or by email at dwac@allianceadvisors.com.

To obtain timely delivery, Digital World stockholders must request the materials no later than     , 2024.

You may also obtain additional information about Digital World from documents filed with the SEC by following the instructions in the section titled “Where You Can Find More Information.”

If you intend to seek Redemption of your Public Shares, you will need to send a letter demanding Redemption and deliver your shares (either physically or electronically) to Digital World’s transfer agent prior to the Digital World Special Meeting in accordance with the procedures detailed under the question “How do I exercise my Redemption Rights?” If you have questions regarding the certification of your position or delivery of your stock, please contact:

Continental Stock Transfer & Trust Company

One State Street Plaza, 30^th Floor

New York, New York 10004

Attn: Mark Zimkind

E-mail: mzimkind@continentalstock.com

 

30

SUMMARY OF THE PROXY STATEMENT/PROSPECTUS

This summary, together with the section titled “Questions and Answers – Questions and Answers about the Digital World Proposals,” summarizes certain information contained in this proxy statement/prospectus and may not contain all of the information that is important to you. To better understand the Business Combination and the Proposals to be considered at the Digital World Special Meeting, you should read this entire proxy statement/prospectus carefully, including the annexes. See also the section titled “Where You Can Find More Information.”

Unless otherwise indicated or the context otherwise requires, references in this Summary of the proxy statement/prospectus to the “Combined Entity” or “New Digital World” refer to Digital World and its consolidated subsidiaries after giving effect to the Business Combination, including TMTG and its subsidiaries. References to the “Company” or “Digital World” refer to Digital World Acquisition Corp. and references to “TMTG” refer to Trump Media & Technology Group Corp., in each case, prior to the consummation of the Business Combination.

Unless otherwise specified, all share calculations assume no exercise of Redemption Rights by the Company’s Public Stockholders, and do not include any shares of Digital World common stock issuable upon the exercise of the Warrants.

The Parties to the Business Combination

Digital World Acquisition Corp.

Digital World is a special purpose acquisition company formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses. Digital World was incorporated under the laws of the State of Delaware on December 11, 2020.

On September 8, 2021, Digital World consummated its IPO of 28,750,000 Units, which included 3,750,000 Units issued pursuant to the full exercise by the underwriters of their over-allotment option, with each Unit consisting of one share of Class A common stock and one-half of one redeemable Warrant, with each Warrant entitling the holder thereof to purchase one share of Class A common stock for $11.50 per share. The Units were sold at a price of $10.00 per Unit, generating gross proceeds to Digital World of $287,500,000. Simultaneously with the closing of the IPO, Digital World completed the private sale of an aggregate of 1,133,484 Placement Units to the Sponsor at a purchase price of $10.00 per unit, generating gross proceeds of $11,334,840. A total of $293,250,000, comprised of $283,906,250 of the proceeds from the Digital World IPO (which amount includes $10,062,500 of the underwriter’s deferred discount) and $9,343,750 of the proceeds of the sale of the Placement Units, was placed in the Trust Account. Digital World’s IPO was conducted pursuant to a registration statement on Form S-1 (Registration No. 333- 256472) that became effective on September 2, 2021. Digital World Class A common stock, Units and Warrants are currently listed on Nasdaq under the symbols “DWAC,” “DWACU” and “DWACW,” respectively. The mailing address of Digital World’s principal executive offices is 3109 Grand Ave., #450, Miami, Florida 33133, and its telephone number at such address is (305) 735-1517.

Merger Sub

Merger Sub is a wholly owned subsidiary of Digital World, incorporated in Delaware on October 18, 2021 solely for the purpose of consummating the Business Combination. Merger Sub owns no material assets and does not operate any business.

The mailing address of Merger Sub’s principal executive offices is 3109 Grand Ave., #450, Miami, Florida 33133, and its telephone number at such address is (305) 735-1517.

 

31

In the Business Combination, Merger Sub will merge with and into TMTG with TMTG surviving the Merger. As a result, Merger Sub will cease to exist, and TMTG will become a wholly owned subsidiary of Digital World.

Trump Media & Technology Group Corp.

TMTG, a Delaware corporation, aspires to build a media and technology powerhouse to rival the liberal media consortium and promote free expression. TMTG was founded to fight back against the big tech companies—Meta (Facebook, Instagram and Threads), X (formerly Twitter), Netflix, Alphabet (Google), Amazon and others—that may curtail debate in America and censor voices that contradict their woke ideology. As confirmed by the “Twitter Files” exposés, X has long suppressed conservative speech (including at the behest of U.S. government officials) through various means, including “shadow banning”—a surreptitious process in which users may not even know their posts are being hidden from other users. The company also outright banned conservative users such as TMTG’s Chairman, former U.S. President Donald J. Trump, who was banned for one year and ten months—even while it continued to allow the Taliban to freely post their views to the world.

In July 2023, a federal district court judge determined that Biden White House personnel likely colluded with big tech companies to violate Americans’ First Amendment rights. The opinion expressed that “targeted suppression of conservative ideas is a perfect example of viewpoint discrimination of political speech.” Big tech companies’ transformation into the arbiters of public speech and organs of state-sponsored censorship contradicts American values. Their suppression of dissident speech constitutes the most serious threat today to a free and democratic debate. Thus, TMTG aims to safeguard public debate and open dialogue, and to provide a platform for all users to freely express themselves.

TMTG’s first product, Truth Social, is a social media platform aiming to disrupt big tech’s control on free speech by opening up the Internet and giving the American people their voices back. It is a public, real-time platform where any user can create content, follow other users and engage in an open and honest global conversation without fear of being censored or cancelled due to their political viewpoints. TMTG does not restrict whom a user can follow, which greatly enhances the breadth and depth of available content. Additionally, users can be followed by other users without requiring a reciprocal relationship, enhancing the ability of TMTG users to reach a broad audience.

Truth Social was generally made available in the first quarter of 2022. The company prides itself on operating its platform, to the best of its ability, without relying on big tech companies. Partnering with pro-free-speech alternative technology firms, TMTG fully launched Truth Social for iOS in April 2022. TMTG debuted the Truth Social web application in May 2022, and the Truth Social Android App became available in the Samsung Galaxy and Google Play stores in October 2022. TMTG introduced direct messaging to all versions of Truth Social in 2022, released a “Groups” feature for users in May 2023 and announced the general availability of Truth Social internationally in June 2023. Since its launch, Truth Social has experienced substantial growth, from zero to an aggregate of approximately 8.9 million signups for Truth Social via iOS, Android and the web as of the date of this proxy statement/prospectus. However, investors should be aware that since its inception, TMTG has not relied on any specific key performance metric to make business or operating decisions. Consequently, it has not been maintaining internal controls and procedures for periodically collecting such information, if any. While many mature industry peers may gather and analyze certain metrics, given the early development stage of the Truth Social platform, TMTG’s management and board believe that such metrics are not critical in the near future for the business and operation of the platform. This stance is due to TMTG’s long-term commitment to implementing a robust business plan, which may involve introducing innovative features and potentially incorporating new technologies, such as advanced video streaming services on its platform. These initiatives may enhance the range of services and experiences TMTG can offer on its Truth Social platform.

At this juncture in its development, TMTG believes that adhering to traditional key performance indicators, such as signups, average revenue per user, ad impressions and pricing, or active user accounts including monthly

 

32

and daily active users, could potentially divert its focus from strategic evaluation with respect to the progress and growth of its business. TMTG believes that focusing on these KPIs might not align with the best interests of TMTG or its shareholders, as it could lead to short-term decision-making at the expense of long-term innovation and value creation. Therefore, TMTG believes that this strategic evaluation is critical and aligns with its commitment to a robust business plan that includes introducing innovative features and new technologies. In connection with such an evaluation, and consistent with SEC guidance, TMTG will consider in the future the relevant key performance indicators for its then-current business operations and determine whether it has effective controls and procedures in place to process information related to the disclosure of key performance indicators and metrics. This will ensure consistency and accuracy over time, or assess the feasibility of implementing any such controls and procedures. Should this be the case, TMTG may decide to collect and report such metrics if they are deemed to significantly enhance investors’ understanding of TMTG’s financial condition, cash flows, and other aspects of its financial performance. However, TMTG may find it challenging or cost-prohibitive to implement such effective controls and procedures and may never collect, monitor, or report any or certain key operating metrics. As the platform evolves and new technologies and features are added, TMTG’s management and board expect to reevaluate whether TMTG will gather and monitor one or more metrics and rely on such information in making management decisions. At such time, TMTG expects to present such material key operating metrics appropriately in its periodic reports to enhance investors’ understanding of its financial condition, cash flows, and any other changes in financial condition and results of operations. See “Management’s Discussion and Analysis of Financial Condition and Results of Operation of TMTG — Key Operating Metrics” and “Risk Factors — Risk Factors Related to TMTG — TMTG does not currently, and may never, collect, monitor or report certain key operating metrics used by companies in similar industries.”

TMTG was incorporated under the laws of the State of Delaware on February 8, 2021.

The mailing address of TMTG’s principal executive offices is 401 N. Cattlemen Rd., Ste. 200, Sarasota, Florida 34232, and its telephone number at such address is (800) 798-5754.

The Proposals

THE BUSINESS COMBINATION PROPOSAL (PROPOSAL 1)

Digital World and TMTG have agreed to the Business Combination under the terms of the Merger Agreement and Plan of Merger. Pursuant to the terms and subject to the conditions set forth in the Merger Agreement, at the Closing, Merger Sub will merge with and into TMTG, with TMTG continuing as the surviving entity and becoming a wholly owned subsidiary of Digital World. For more detailed information, see the section titled “The Business Combination Proposal (Proposal 1)” and the Merger Agreement, which is attached as Annex A to this proxy statement/prospectus.

Merger Consideration

Subject to the terms and conditions set forth in the Merger Agreement, at the Effective Time:

 

(a)

the outstanding shares of Digital World Class A common stock, including any Digital World Class B common stock (all of which will be converted into Digital World Class A common stock in accordance with the Digital World Charter), will be redesignated as New Digital World common stock;

 

(b)

as consideration for the Merger, TMTG securityholders (other than holders of TMTG Convertible Notes) as of immediately prior to the Effective Time will be entitled to receive the Merger Consideration, with each such TMTG securityholder receiving shares of New Digital World common stock for its TMTG securities. In addition, prior to the Effective Time, the issued and outstanding TMTG Convertible Notes will be converted into shares of TMTG common stock, such that, at the Effective Time, holders of such TMTG common stock will be entitled to receive from New Digital

 

33

World a number of shares of New Digital World common stock equal to (i) the number of such shares of TMTG common stock multiplied by (ii) the conversion ratio applicable to the previously converted TMTG Convertible Notes. Accordingly, at the Effective Time, (a) all of the issued and outstanding TMTG common stock immediately prior to the Effective Time (other than those properly exercising any applicable appraisal rights under Delaware law or any shares of TMTG common stock issued upon the conversion of TMTG Convertible Notes immediately prior to the Effective Time pursuant to the terms of the Merger Agreement) will automatically be cancelled and will cease to exist, in exchange for the right to receive their pro rata portion of the Merger Consideration and the Earnout Shares, if any, (b) all of the issued and outstanding common stock of TMTG immediately prior to the Effective Time that was issued upon the conversion of TMTG Convertible Notes pursuant to the terms of the Merger Agreement will automatically be cancelled and will cease to exist, in exchange for the right to receive shares of New Digital World common stock upon the terms set forth in the Merger Agreement, (c) each outstanding option to acquire shares of TMTG common stock (whether vested or unvested) will be assumed by New Digital World and automatically converted into an option to acquire shares of New Digital World common stock, with its price and number of shares equitably adjusted based on the conversion ratio of the shares of TMTG common stock into the Merger Consideration, and (d) each outstanding restricted stock unit of TMTG shall be converted into a restricted stock unit relating to shares of New Digital World common stock; and

 

(c)

TMTG stockholders (other than with respect to any shares of TMTG common stock received as a result of the conversion of TMTG Convertible Notes) will also have a contingent right to receive the Earnout Shares after the Closing based on the price performance of the New Digital World common stock during the Earnout Period. The Earnout Shares shall be earned and payable during the Earnout Period as follows:

 

•

if the VWAP of New Digital World common stock equals or exceeds $12.50 per share for any 20 trading days within any 30 trading day period, New Digital World shall issue to the former TMTG stockholders an additional 15,000,000 Earnout Shares;

 

•

if the VWAP of New Digital World common stock equals or exceeds $15.00 per share for any 20 trading days within any 30 trading day period, New Digital World shall issue to the former TMTG stockholders an additional 15,000,000 Earnout Shares; and

 

•

if the VWAP of New Digital World common stock equals or exceeds $17.50 per share for any 20 trading days within any 30 trading day period, New Digital World shall issue to the former TMTG stockholders an additional 10,000,000 Earnout Shares.

The Merger Consideration will be subject to a post-Closing true up 90 days after the Closing.

Escrow Shares

At the Closing, shares of New Digital World common stock equal to the quotient obtained by dividing (i) three percent (3%) of the initial Merger Consideration (meaning $875,000,000) (as determined as of the Closing) (the “Escrow Amount”) by (ii) the share price of New Digital World common stock (together with any equity securities paid as dividends or distributions with respect to such shares or into which such shares are exchanged or converted, the “Escrow Shares”) otherwise issuable to the TMTG stockholders (allocated pro rata among the TMTG stockholders based on the Merger Consideration otherwise issuable to them at the Closing) will be deposited into a segregated escrow account with Continental Stock Transfer & Trust Company (or such other escrow agent reasonably acceptable to Digital World and TMTG), as escrow agent, and held in escrow together with any dividends, distributions or other income on the Escrow Shares (the “Escrow Property”) in accordance with an escrow agreement to be entered into in connection with the Business Combination (the “Escrow Agreement”). The Escrow Property will be held in the escrow account for a period of twelve (12) months after the Closing as the sole and exclusive source of payment for any post-Closing purchase price adjustments and indemnification claims (other than fraud claims). The TMTG stockholders will have the right to vote the Escrow Shares while they are held in escrow.

 

34

Merger Closing Conditions

The Merger Agreement is subject to customary conditions to the Closing. The Closing is also subject to the following additional conditions (amongst others): (i) the approval of the Merger Agreement and the Business Combination by the requisite vote of Digital World’s stockholders and TMTG’s stockholders, (ii) Digital World having at least $5,000,001 in net tangible assets, after giving effect to the completion of its Redemption of Public Stockholders who redeem their shares in connection with the Business Combination, (iii) the election or appointment of members to the Combined Entity’s Board immediately after the Closing in accordance with the Merger Agreement, (iv) the effectiveness of the registration statement of which this proxy statement/prospectus forms a part, (v) the conditional approval of the Combined Entity’s initial listing application with Nasdaq with respect to the common stock to be issued pursuant to the Business Combination, and (vi) Digital World having cash and cash equivalents of at least equal to $60,000,000, including funds remaining in the Trust Account (after giving effect to the completion and payment of the Redemption).

In addition, unless waived by TMTG, the obligations of TMTG to consummate the Business Combination are subject to the fulfillment of certain closing conditions, including but not limited to the following (in addition to customary certificates and other closing deliverables):

 

•

The representations and warranties of Digital World being true and correct as of the date of the Merger Agreement and as of the Closing (subject to Material Adverse Effect (as defined below) with respect to Digital World);

 

•

Digital World having performed in all material respects their respective obligations and complied in all material respects with their respective covenants and agreements under the Merger Agreement required to be performed or complied with on or prior to the date of the Closing; and

 

•

TMTG having received a copy of a duly executed Escrow Agreement by Digital World.

Unless waived by Digital World, the obligations of Digital World and the Merger Sub to consummate the Business Combination are subject to the satisfaction of the following conditions (in addition to customary certificates and other closing deliverables):

 

•

The representations and warranties of TMTG being true and correct as of the date of the Merger Agreement and as of the Closing (subject to Material Adverse Effect);

 

•

TMTG having performed in all material respects its obligations and complied in all material respects with its covenants and agreements under the Merger Agreement required to be performed or complied with on or prior to the date of the Closing;

 

•

Absence of a Material Adverse Effect with respect to TMTG since the date of the Merger Agreement that is continuing and uncured;

 

•

TMTG and the TMTG securityholders specified therein having executed and delivered the Escrow Agreement (as described above);

 

•

TMTG shall have converted, terminated, extinguished and cancelled in full any outstanding TMTG Convertible Securities or commitments therefor, other than the TMTG Options, the TMTG RSUs and the TMTG Convertible Notes;

 

•

Non-competition agreements (as described below) having been have been executed and delivered;

 

•

Lock-up agreements (as described below) having been have been executed and delivered, unless otherwise waived by Digital World prior to the Closing; and

 

•

Digital World shall have received a duly executed legal opinion from the TMTG’s counsel.

Merger Structure

Pursuant to the Merger Agreement, upon the Closing, Merger Sub, a wholly owned subsidiary of Digital World, will be merged with and into TMTG, with TMTG continuing as the surviving entity of the Merger and

 

35

becoming a wholly owned subsidiary of Digital World. See “The Business Combination Proposal (Proposal 1) — The Merger Agreement — General Description of the Merger Agreement” and “The Business Combination Proposal (Proposal 1) — The Merger Agreement — Merger Consideration.”

Covenants

Each party to the Merger Agreement has agreed to use its reasonable best efforts to effect the Closing. The Merger Agreement also contains certain customary covenants by each of the parties during the period between the signing of the Merger Agreement and the earlier of the Closing or the termination of the Merger Agreement in accordance with its terms (the “Interim Period”), including, but not limited to covenants regarding (i) the provision of access to their offices, properties, books and records, (ii) the operation of their respective businesses in the ordinary course of business, (iii) provision of financial statements by TMTG; (iv) filing by Digital World of its reports required by the Exchange Act, and efforts regarding Nasdaq listing requirements, (v) no solicitation of other competing transactions, (vi) no trading in Digital World’s securities by TMTG using Digital World’s material non-public information, (vii) notifications of certain breaches, consent requirements or other matters, (viii) efforts to obtain third party and regulatory approvals and comply with all government authority requirements, (ix) further assurances to cooperate, (x) a requirement for TMTG to promptly hold its stockholder meeting or otherwise obtain the written consent of its stockholders to approve the Merger Agreement and related transactions, (xi) tax matters and transfer taxes, (xii) public announcements, (xiii) confidentiality, (xiv) post-Closing Digital World board of directors and executive officers, (xv) payment of extension expenses, (xvi) reasonable best efforts to obtain a waiver from President Trump of his right to terminate the License Agreement (the “License Agreement Waiver”), (xvii) provision of updated diligence materials, (xviii) efforts to reduce or eliminate the PIPE and (xix) modification of certain registration rights agreements by each party. There are also certain customary post-Closing covenants regarding (i) maintenance of books and records, (ii) indemnification of directors and officers and (iii) use of Trust Account proceeds.

Pursuant to the Merger Agreement, Digital World agreed to file a Registration Statement on Form S-4 with respect to the issuance of the shares of New Digital World common stock to be issued as consideration to the TMTG equity holders in the Business Combination, which will contain a proxy statement/prospectus for a special meeting of Digital World’s stockholders to consider the Merger Agreement and the related transactions and matters, including the Required Proposals described herein.

TMTG agreed that the ownership and position of its principal would be structured in such a way as to eliminate the need for restructuring of such ownership or the requirement to make changes in position of the principal upon the occurrence of certain specified material disruptive events.

Termination

The Merger Agreement may be terminated under certain customary and limited circumstances at any time prior to the Closing, including among other reasons, (i) by mutual consent of TMTG and Digital World, (ii) by either Digital World or TMTG if any of the conditions to the Closing have not been satisfied or waived by September 20, 2022 (which, for the avoidance of doubt, as of the date of this proxy statement/prospectus, has been extended to December 31, 2023, the “Outside Date”), provided that this termination right shall not be available to Digital World or TMTG if the breach by such party (i.e., either Digital World or Merger Sub on one hand, or TMTG, on the other hand) of the Merger Agreement was the cause of, or resulted in, the failure of the Closing to occur on or before the Outside Date, (iii) by either Digital World or TMTG if a governmental authority of competent jurisdiction shall have issued an order or taken any other action permanently restraining, enjoining or otherwise prohibiting, or if any law is in effect making illegal, the transactions contemplated by the Merger Agreement, (iv) by either Digital World or TMTG for the other party’s uncured breach (subject to certain materiality qualifiers and cure periods), (v) by Digital World if there has been an event after the signing of the Merger Agreement that has a Material Adverse Effect on TMTG (but excluding a qualifying settlement of certain litigation in which TMTG is involved) that is uncured and continuing, (vi) by TMTG if there has been an event

 

36

after the signing of the Merger Agreement that has a Material Adverse Effect on Digital World that is uncured and continuing, (vii) by either Digital World or TMTG if approval for the Business Combination and the other Required Proposals are not obtained at the Digital World Special Meeting, (viii) by either Digital World or TMTG if a special meeting of TMTG’s stockholders is held and TMTG’s stockholder shall not have approved the Merger Agreement and the Business Combination and related matters, (ix) by the mutual and reasonable written consent of Digital World and TMTG in the event that that any required approval of the SEC or any other governmental authority cannot be obtained by the Outside Date, as such date may be extended by an extension, (x) by Digital World from October 31, 2023 through November 21, 2023 if the Digital World Board, following updated due diligence on TMTG no longer believes in good faith that the Business Combination and the transactions contemplated by the Merger Agreement are in the best interests of Digital World or its stockholders, (xi) by TMTG from October 31, 2023 through November 21, 2023 if the TMTG Board, following updated due diligence on Digital World no longer believes in good faith that the Business Combination and the transactions contemplated by the Merger Agreement are in the best interests of TMTG or its stockholders, and (xii) by TMTG on or prior to November 21, 2023 if Digital World has not filed an amendment to the Registration Statement by November 14, 2023.

In December 2023, Digital World concluded its renewed due diligence with respect to TMTG’s business plan. As such, on November 21, 2023, both Digital World and TMTG communicated that they would continue to cooperate with each other regarding updated due diligence and that should the merger not be completed by December 31, 2023, neither party intended to assert a breach or violation by the other party or its affiliates of any representation, warranty, covenant or obligation under the Merger Agreement as a basis for contesting or opposing such other party’s exercise of its right to terminate the Merger Agreement pursuant to Section 8.1(b) thereof, based on the information known as of such date.

Executive Officers and Directors of the Combined Entity

The following persons are expected to be elected or appointed by the Digital World Board to serve as executive officers and directors of the Combined Entity following the Business Combination. For biographical information concerning the executive officers and directors following the Business Combination, see “Management after the Business Combination — Management and Board of Directors.”

 

Name		Age				Position(s)
Devin G. Nunes			50			Chief Executive Officer and Director nominee (2)
Phillip Juhan			49			Chief Financial Officer
Andrew Northwall			37			Chief Operating Officer
Vladimir Novachki			35			Chief Technology Officer
Sandro De Moraes			49			Chief Product Officer
Scott Glabe			40			General Counsel
Eric Swider			50			Director nominee (1)
Donald J. Trump, Jr.			46			Director nominee (2)
Kashyap “Kash” Patel			43			Director nominee (2)
W. Kyle Green			51			Independent Director nominee (2)
Robert Lighthizer			76			Independent Director nominee (2)
Linda McMahon			75			Independent Director nominee (2)

 

(1)	Digital World Designee

(2)	TMTG Designee.

Interests of TMTG’s and Digital World’s Directors and Officers in the Business Combination

When you consider the recommendation of the Digital World Board in favor of approval of the Business Combination Proposal and the other Proposals, you should keep in mind that the directors and executive officers of Digital World and of TMTG have interests in the Business Combination and other Proposals that may be

 

37

different from, or in addition to, those of Digital World stockholders generally. These interests include, among other things, the fact that certain of TMTG’s directors and officers will become directors and officers of the Combined Entity, and certain of Digital World’s directors and officers will become directors of the Combined Entity, upon the consummation of the Business Combination.

Please see the sections entitled “Risk Factors” and “The Business Combination Proposal (Proposal 1) — The Merger Agreement — Interests of TMTG’s Directors and Officers in the Business Combination” and “The Business Combination Proposal (Proposal 1) — The Merger Agreement — Interests of Digital World’s Directors and Officers in the Business Combination” of this proxy statement/prospectus for a further discussion of this and other risks.

Classified Board of Directors

The Combined Entity’s Board will consist of seven (7) members upon the Closing. In accordance with the Amended Charter to be filed immediately after the Closing, the Board will be divided into three classes, Classes I, II and III, each to serve a three-year term, except for the initial term after the Closing, for which the Class I directors will be up for reelection at the first annual meeting of stockholders occurring after the Closing, for which the Class II directors will be up for reelection at the second annual meeting of stockholders occurring after the Closing and for which the Class III directors will be up for reelection at the third annual meeting of the stock holders occurring after Closing. At each annual meeting of stockholders of the Combined Entity, the successors to directors whose terms then expire will be elected to serve from the time of election and qualification until the third annual meeting following the election. Directors will not be able to be removed during their term except for cause. Digital World and TMTG will work in good faith to equitably allocate director designees among the three classes of directors, provided that Digital World’s designees will serve in the class of directors with the latest initial re-election date.

It is expected that that any additional directorships resulting from an increase in the number of directors will be distributed among the three classes so that, as nearly as possible, each class will consist of one-third of the directors. The division of the Combined Entity’s Board into three classes with staggered three-year terms may delay or prevent a change of the Combined Entity’s management or a change in control.

 

38

Post-Business Combination Ownership of New Digital World

 

		Minimum Redemption								33.33% Redemption								50% Redemption								Maximum (77%) Redemption (1)
Digital World
SPAC public shareholder shares			28,745,952				21.2	%			19,164,926				15.2	%			14,372,976				11.9	%			6,744,940				5.9	%
SPAC private placement shares			1,133,484				0.8	%			1,133,484				0.9	%			1,133,484				0.9	%			1,133,484				1.0	%
Underwriter IPO shares			143,750				0.1	%			143,750				0.1	%			143,750				0.1	%			143,750				0.1	%
SPAC sponsor promote (primarily Founder Shares)			9,631,250				7.1	%			9,631,250				7.6	%			9,631,250				7.9	%			9,631,250				8.5	%
Total Digital World			39,654,436				29.3	%			30,073,410				23.9	%			25,281,460				20.9	%			17,653,424				15.6	%
TMTG
Rollover equity shares for TMTG shareholders			87,500,000				64.6	%			87,500,000				69.5	%			87,500,000				72.2	%			87,500,000				77.1	%
TMTG convertible note shares			8,369,509				6.2	%			8,369,509				6.6	%			8,369,509				6.9	%			8,369,509				7.4	%
Total TMTG			95,869,509				70.7	%			95,869,509				76.1	%			95,869,509				79.1	%			95,869,509				84.4	%
Total			135,523,945				100.0	%			125,942,919				100.0	%			121,150,969				100.0	%			113,522,933				100.0	%

 

(1)

Digital World is required to fulfill the Financial Closing Conditions. The ability to meet the Financial Closing Conditions will not be known until the level of redemptions of Public Shares in connection with the Business Combination is known. As a result, if redemptions exceed $243.3 million (or 77% of the Trust Account assets before redemptions) the Business Combination would not close. As such, the Maximum Redemption scenario does not reflect the full amount of Public Shares that may be redeemed under Digital World’s Charter. Accordingly, if holders of more than 22,001,012 Public Shares seek to exercise such Redemption Rights, the Business Combination is not expected to close.

Digital World’s Reasons for the Business Combination

The Digital World Board, in evaluating the Business Combination, consulted with Digital World’s management and its financial and legal advisors. In reaching its initial unanimous resolution (i) that the Merger Agreement and the transactions contemplated thereby, including the Merger Consideration and the Earnout Shares, are fair and in the best interests of Digital World and (ii) to recommend that the Digital World stockholders adopt the Merger Agreement and approve the Business Combination and the other transactions contemplated by the Merger Agreement, the Digital World Board considered the factors discussed below.

In light of the number and wide variety of factors considered in connection with its evaluation of the Business Combination, the Digital World Board did not consider it practicable to, and did not attempt to, quantify or otherwise assign relative weights to the specific factors that it considered in reaching its determination and supporting its decision. The Digital World Board viewed its decision as being based on any and all of the information available and the factors presented to and considered by it. In addition, individual

 

39

directors may have given different weight to different factors. This explanation of Digital World’s reasons for the Business Combination and all other information presented in this section may be forward-looking in nature and, therefore, should be read in light of the factors discussed under “Cautionary Note Regarding Forward-Looking Statements.” Many factors were considered by Digital World, and the factors outlined herein may or may not have been considered by any particular directors, member of management, or advisor of Digital World. Notwithstanding whether any of these factors were considered by any individual board member, the Board voted unanimously to enter into the original Merger Agreement.

The officers and directors of Digital World have substantial experience in evaluating the operating and financial merits of companies from a wide range of industries and concluded that their experience and background, together with the experience and sector expertise of Digital World’s advisors, enabled them to make the necessary analyses and determinations regarding the Business Combination.

The Digital World Board considered the following factors pertaining to the Business Combination as generally supporting its decision to enter into the original Merger Agreement and the transactions contemplated thereby:

• Brand and Growth Prospects. Analytical data suggests that the consumer base is receptive to seeking alternative media sources, especially those differentiated from the current market offerings. Surveys have shown potential for a large adoption of media platforms associated with President Trump as legacy social media companies are seen to censor political speech. As the U.S. population continues to “cut the cord” that tethers devices to traditional cable and media companies, content and content distribution is becoming the key driving force behind capturing and retaining customers. After decades of growth and consolidation in the media and technology sectors, the users, creators and consumers of content can often feel there are fewer and fewer differentiated choices when looking at platforms they can choose to consume, create and distribute selected content and TMTG may successfully offer a differentiated choice.

The Digital World Board believes that TMTG, if properly capitalized, is very well positioned to grow a user base at an accelerated pace. In 2004 when Facebook launched, it obtained an estimated 1 million users within the first year. It then took an estimated three years to break through the 10 million user mark. In 2004, Facebook’s capitalization was limited to under $1 million, social media was not yet universally known or widely popular and only 61% of Americans accessed the internet (compared to 92% of Americans in 2023). Since 2004, social media platforms have evolved. Recent data demonstrates how popular social medial platforms have become — Threads (Meta’s new online social media and social networking platform) registered 2 million users in the first two hours after its launch, ChatGPT registered 1 million users within five days of launch in 2022 and Instagram registered 1 million users within 2.5 months of launch in 2010. Based on such historical growth of Facebook and other social media platforms since 2004, the unique figurehead and marketing proposition of TMTG’s platform in the existing social and political climate and the receipt of proceeds upon the consummation of the Business

Combination, the Digital World Board believes that the management of TMTG is positioned to exceed this initial growth trajectory. See “Unaudited Pro Forma Condensed Financial Information” regarding the capitalization scenarios, which are contingent of the redemption rate.

• Broad and Diverse User Base. TMTG has a broad potential user base with demonstrated brand awareness, brand loyalty and eagerness to seek out change while making choices of where to spend their media dollars and attention. The Board believed that as TMTG management sought to broaden TMTG’s brand appeal, this could materially widen the field of potential customers and users the media platform can attract;

• Due Diligence. Initial due diligence examinations of TMTG and discussions with TMTG’s management team and Digital World’s legal advisors during Digital World’s initial due diligence examination of TMTG led Digital World to believe that TMTG has assembled the elements necessary to create the foundation for a potentially very successful media and technology company;

• Stockholder Liquidity. The obligation in the Merger Agreement to have the New Digital World common stock issued as Merger Consideration continue to be listed on Nasdaq, a major U.S. stock exchange, which the Digital World Board believes has the potential to offer stockholders enhanced liquidity;

 

40

• Financial Information and Comparable Company Analysis. The Digital World Board also considered factors related to TMTG’s financial outlook. In connection with Digital World’s initial review of the Business Combination, TMTG provided Digital World’s management with its internal financial analysis model. Although Digital World’s Board received TMTG’s financial model and considered it as a material factor in its decision to enter into the original Merger Agreement and the transactions contemplated thereby, its reliance on such financial model was limited due to the Digital World Board’s view that evaluating real world growth and financial projections related to a rapid growth company in a competitive industry can be challenging. The Board recognized that a properly capitalized technology company in the media and technology space should instead have a primary focus of user acquisition during its initial growth stages. This may initially hamper earnings and even topline revenues. However, the Board believes that if management of TMTG is successful in the user acquisition phase, this will ultimately drive the key performance indicators that are directly correlated to cash flow and income statements.

An additional financial consideration was management’s ability to attract sufficient pre-revenue capital investment to fuel user acquisition efforts. As of the October 2021 execution of the Merger Agreement, TMTG had already raised over $5 million in its first months of inception. The Digital World Board reviewed TMTG’s current prospects for user acquisition in its business plan. In reviewing these factors, the Digital World Board noted that TMTG’s brand recognition and President Trump’s strong social media following could well position the company to gain market share and expand its user base at an accelerated pace, allowing for a more rapid transition of focus to revenue expansion that benefits long-term EBITDA margin.

Digital World’s management, in consultation with EF Hutton, division of Benchmark Investments, LLC and representative to the underwriters in Digital World’s IPO (“EF Hutton”), acting solely in its capacity as placement agent to Digital World in connection with the PIPE, reviewed certain financial and operating information of certain publicly traded companies (the “Trading Comparables”), particularly, similar social media, content production and distribution, and media companies around the world. The selected companies included a group of companies operating in various global markets, including, among others, Twitter (now known as X), Facebook (now known as Meta), Netflix and Snapchat. None of the Trading Comparables has characteristics identical to TMTG. The Trading Comparables were selected because of their similarities to the potential offerings to be provided by TMTG.

At the time of evaluation, the median enterprise value of the available Trading Comparables surpassed $324 billion. Specifically, the enterprise value of Twitter (now known as X), the closest competitor to TMTG’s initial product, Truth Social, was $41 billion. Therefore, at such time, Digital World’s management concluded that an initial valuation of $875 million, with the potential for an additional earnout of $825 million, was a reasonable assessment for TMTG’s enterprise valuation in the Business Combination transaction. This analysis of Trading Comparables considered both the anticipated TMTG+ product and the launch of Truth Social in the short-term, and was based on the primary assumption that companies like Twitter, Facebook, Snapchat, Netflix, Roku, Peloton, and Spotify closely paralleled the expected business model and market segments of TMTG’s forthcoming offerings. This assessment relied on publicly available financial data from late 2020 and 2021. However, the reliability and usefulness of such methodology are inherently limited as a result of variances in company size, market maturity and the unpredictability of product offering success or trajectory. In addition, the

dynamic nature of the technology and media sectors, which are prone to and have historically undergone significant and rapid changes, make valuation of companies in the space highly susceptible to change in response to market and consumer trends.

In late 2021, Digital World’s management also reviewed TMTG’s financial model and certain revenue projections for TMTG’s first product, Truth Social, including projections of total users, monetizable users, and average revenue per user, and a potential TMTG streaming service including total subscribers and pricing models.

• Experienced Management Team. The Digital World Board believes TMTG has a strong management team with significant experience.

 

41

• Lock-Up. Unless waived by Digital World prior to the Closing, key stockholders of TMTG (including its management team) agreed to be subject to a six-month lockup in respect of their Digital World common stock, subject to certain customary exceptions, which would provide important stability to the leadership and governance of TMTG. In addition, the Amended Charter will contain lock-up restrictions as described herein.

• Other Alternatives. The Digital World Board believes, after a thorough review of other business combination opportunities reasonably available to Digital World, that the proposed Business Combination represents the best potential business combination for Digital World and the most attractive opportunity based upon the process utilized to evaluate and assess other potential acquisition targets. Given the potential number of users and accelerated adoption of Truth Social, as well as the additional business verticals in development, the Digital World Board believe TMTG offers its stockholders the most potential value when compared to other target candidates.

• Negotiated Transaction. The financial and other terms of the Merger Agreement and the fact that such terms and conditions are reasonable and were the product of arm’s length negotiations between Digital World and TMTG.

The Digital World Board also considered a variety of uncertainties and risks and other potentially negative factors concerning the Business Combination including, but not limited to, the following:

• Macroeconomic Risks. Macroeconomic uncertainty, including material adverse developments in domestic and global economic conditions, or the occurrence of other world events, and the effects it could have on TMTG’s revenues post-closing.

• Business Plan May Not Be Achieved. The risk that TMTG may not be able to execute on the business plan, including but not limited to its rollout of Truth Social, and realize the financial performance as set forth in the financial model presented to Digital World’s management team and board of directors.

• Redemption Risk. The potential that a significant number of Digital World Public Stockholders elect to redeem their Public Shares prior to the consummation of the Business Combination and pursuant to Digital World’s existing charter, which would potentially make the Business Combination more difficult or impossible to complete.

• Stockholder Vote. The risk that Digital World’s stockholders may fail to provide the respective votes necessary to affect the Business Combination.

• Closing Conditions. The fact that the completion of the Business Combination is conditioned on the satisfaction of certain closing conditions that are not within Digital World’s control, including the Financial Closing Conditions.

• Litigation. The possibility of litigation challenging the Business Combination or that an adverse judgment granting permanent injunctive relief could indefinitely enjoin consummation of the Business Combination.

• Listing Risks. The challenges associated with preparing TMTG, a private entity, for the applicable disclosure and listing requirements to which TMTG will be subject as a publicly traded company on the Nasdaq.

• Benefits May Not Be Achieved. The risks that the potential benefits of the Business Combination may not be fully achieved or may not be achieved within the expected timeframe.

• Liquidation of Digital World. The risks and costs to Digital World if the Business Combination is not completed, including the risk of diverting management focus and resources from other business combination opportunities, which could result in Digital World being unable to effect a business combination.

• Growth Initiatives May Not be Achieved. The risk that TMTG’s growth initiatives may not be fully achieved or may not be achieved within the expected timeframe.

• Board and Independent Committees. The risk that TMTG’s board of directors post-Closing and independent committees do not possess adequate skill sets within the context of TMTG operating as a public company.

 

42

• Digital World Stockholders Receiving a Minority Position in TMTG. The risk that Digital World stockholders will hold a minority position in TMTG.

• Fees and Expenses. The fees and expenses associated with completing the Business Combination; and

• Other Risk Factors. Various other risk factors associated with the business of TMTG, as described in the section entitled “Risk Factors” appearing elsewhere in this proxy statement/prospectus.

The Digital World Board concluded that the potential benefits expected to be achieved by Digital World and its stockholders resulting from the Business Combination outweighed the potentially negative factors associated with the Business Combination. Accordingly, at the time of entry into the Merger Agreement, the Digital World Board determined that the Business Combination was advisable, fair to, and in the best interests of, Digital World and its stockholders.

Nevertheless, since the entry into the Merger Agreement in October 2021, TMTG’s business plan and financial model have changed and as a result, the prior financial model provided to the Digital World Board is not reflective of the future expected performance. While the Digital World Board previously approved the Business Combination, the Merger Agreement contemplates that during the pendency of the transaction TMTG will provide Digital World updated due diligence information regarding the financial condition of TMTG’s businesses and that following receipt and review of such due diligence information the Board could have, from October 31, 2023 through November 21, 2023, terminated the Merger Agreement if it no longer believed in good faith that the Business Combination was in the best interests of Digital World or its stockholders.

In December 2023, Digital World concluded its renewed due diligence with respect to TMTG’s business plan. Digital World’s Board determined (i) that the Merger Agreement and the transactions contemplated thereby, including the Merger Consideration and the Earnout Shares, are fair and in the best interests of Digital World and (ii) to recommend that the Digital World stockholders adopt the Merger Agreement and approve the Business Combination and the other transactions contemplated by the Merger Agreement.

Given the duration of time between the initial execution of the Merger Agreement and the Second Amendment to the Agreement as well as the significant turnover on the Digital World Board since the Merger Agreement was first signed in 2021, during December 2023 in connection with exercising its fiduciary duties, the Board sought to refresh and complete its financial and business due diligence of TMTG, including with respect to the revised transaction terms contemplated by the Second Amendment to the Agreement. In reaching its determination and in support of its decision that the Business Combination and the other transactions contemplated by the Merger Agreement, including the Merger Consideration and the Earnout Shares, are fair and in the best interests of Digital World and its stockholders, the Digital World Board conducted a bring-down evaluation of TMTG’s business model, financial performance, growth opportunities and competitive positioning. As part of this evaluation process, the Digital World Board engaged Alvarez & Marsal Valuation Services, LLC as an independent advisor with which Digital World has not had a material relationship in the past two years, to prepare a Comparable Company Analysis.

The Comparable Company Analysis was based on certain publicly traded companies selected by Digital World’s management and the Digital World Board, which included Meta, X (formerly Twitter), Snapchat and Pinterest. However, while these companies may share certain characteristics similar to TMTG, the Digital World Board did not consider any of these companies to be identical in nature to TMTG, given its affiliation with former President Trump and unique market positioning, including purposeful differentiation from the current market offerings considered in its analysis.

The Comparable Company Analysis was only one element of a broader due diligence process conducted by the Digital World Board, and the independent advisor was neither engaged for nor delivered a fairness opinion or other independent conclusion with respect to the terms of the Second Amendment to the Agreement. Through a series of interactive teleconferences during December 2023, Digital World’s management and the Digital World Board considered different frameworks of analysis that could be applied to companies that may share similar

 

43

financial and growth characteristics with TMTG to serve as a resource and assist the Digital World Board in conducting its due diligence process.

Since TMTG did not provide the Digital World Board with TMTG’s financial projections in connection with the Digital World Board’s bring-down due diligence process, the Comparable Company Analysis was based on information that was publicly available, as well as limited supplemental due diligence information supplied by TMTG to assist the independent advisor in making any required assumptions to develop a forward-looking financial and growth assessment of TMTG relative to TMTG’s current business model, financial performance, growth opportunities and competitive positioning.

 

•

Brand and Growth Prospects. In addition to the brand and growth prospects initially considered by the Digital World Board in 2021, the Digital World Board believes that the taking private transaction of Twitter (now known as X) created a market opportunity and strengthens the brand and growth prospects rationale discussed above. The Digital World Board continues to believe that TMTG, if properly capitalized, is very well positioned to grow a user base at an accelerated pace.

 

•

Broad and Diverse User Base. The Digital World Board continues to believe that TMTG has a broad potential user base with demonstrated brand awareness, established brand loyalty and eagerness to seek out change, while making choices of where to spend their media dollars and attention. The Digital World Board continues to believe that TMTG management is continuing its efforts to increase TMTG’s brand appeal, which could materially widen the field of potential customers and users the media platform can attract, particularly in light of the global sociopolitical context.

 

•

Due Diligence. The Digital World Board and management team engaged in a due diligence process with TMTG’s management team and Digital World’s legal advisors regarding its business and legal affairs. As a result of such renewed due diligence, the Digital World Board continues to believe that TMTG has assembled the elements necessary to create the foundation for a potentially very successful media and technology company.

 

•

Financial Information and Comparable Company Analysis. In addition to the financial information and comparable company analysis initially considered by the Digital World Board in 2021, in late 2023, the Digital World Board sought to refresh and complete its financial and business due diligence of TMTG, including with respect to the revised transaction terms contemplated by the Second Amendment to the Agreement. In doing so, the Digital World Board engaged an independent advisor to assist management and the Digital World Board in evaluating Truth’s business model, financial performance, growth opportunities and competitive positioning. In conducting such financial and business due diligence, the Digital World Board considered, in part, the comparative analysis as discussed above, together with the aforementioned considerations.

 

•

Experienced Management Team. The Digital World Board believes that TMTG continues to have a strong management team with significant experience and commitment to its growth strategy.

Accounting Treatment

The Business Combination is expected to be accounted for as a reverse recapitalization in accordance with U.S. GAAP. Under this method of accounting, Digital World will be treated as the acquired company and TMTG will be treated as the acquirer for financial statement reporting purposes. See section entitled “The Business Combination Proposal (Proposal 1) — Anticipated Accounting Treatment.”

No Delaware Appraisal Rights for Digital World Stockholders

Appraisal rights are statutory rights under the DGCL that enable stockholders who object to certain extraordinary transactions to demand that the corporation pay such stockholders the fair value of their shares instead of receiving the consideration offered to stockholders in connection with the extraordinary transaction.

However, appraisal rights are not available in all circumstances. Appraisal rights are not available to Digital World stockholders or Warrant holders in connection with the Business Combination.

 

44

Impact of the Business Combination on Digital World’s Public Float

It is anticipated that, upon the completion of the Business Combination, Digital World’s Public Stockholders will retain an ownership interest of approximately 21.2% of the outstanding capital stock of the Combined Entity, the Sponsor will retain an ownership interest of approximately 7.8% of the outstanding capital stock of the Combined Entity and holders of TMTG securities will own approximately 70.70% of the outstanding capital stock of the Combined Entity.

Accordingly, the foregoing ownership percentages with respect to the Combined Entity following the Business Combination (A) exclude the exercise of outstanding Warrants and the conversion of securities issued in the Post-IPO Financings and (B) assume that (i) there are no Redemptions of any shares by Digital World’s Public Stockholders in connection with the Business Combination and (ii) no awards are issued under the Equity Incentive Plan. If the actual facts are different than these assumptions (which they are likely to be), the percentage ownership retained by Digital World’s existing stockholders in the Combined Entity will be different.

Upon consummation of the Business Combination, and subject to approval of the Incentive Plan Proposal, TMTG’s executive officers are expected to receive grants of stock options and restricted stock units under the Equity Incentive Plan from time to time as determined by the Compensation Committee. Each TMTG Convertible Note that is issued and outstanding immediately prior to the Effective Time will automatically convert immediately prior to the Effective Time into a number of shares of TMTG common stock as such TMTG Convertible Note would automatically convert upon the consummation of the Business Combination with Digital World, in accordance with each such TMTG Convertible Note.

The following table illustrates varying ownership levels in the Combined Entity, assuming the factors mentioned above, and excluding the exercise of above-mentioned Warrants or the issuance of any shares of common stock upon conversion of securities issued in Post-IPO Financings, in the event of (i) no Redemptions, (ii) 33.33% Redemptions, (iii) 50% Redemptions and (iv) maximum Redemptions (77%) of 28,750,000 Public Shares:

 

		Minimum Redemption								33.33% Redemption								50% Redemption								Maximum (77%) Redemption (1)
DWAC SPAC public shareholder shares			28,745,952				21.2	%			19,164,926				15.2	%			14,372,976				11.9	%			6,744,940				5.9	%
SPAC private placement shares			1,133,484				0.8	%			1,133,484				0.9	%			1,133,484				0.9	%			1,133,484				1.0	%
Underwriter IPO shares			143,750				0.1	%			143,750				0.1	%			143,750				0.1	%			143,750				0.1	%
SPAC sponsor promote (primarily Founder Shares)			9,631,250				7.1	%			9,631,250				7.6	%			9,631,250				7.9	%			9,631,250				8.5	%
Total DWAC			39,654,436				29.3	%			30,073,410				23.9	%			25,281,460				20.9	%			17,653,424				15.6	%
TMTG
Rollover equity shares for TMTG shareholders			87,500,000				64.6	%			87,500,000				69.5	%			87,500,000				72.2	%			87,500,000				77.1	%
TMTG convertible note shares			8,369,509				6.2	%			8,369,509				6.6	%			8,369,509				6.9	%			8,369,509				7.4	%
Total TMTG			95,869,509				70.7	%			95,869,509				76.1	%			95,869,509				79.1	%			95,869,509				84.4	%
Total			135,523,945				100.0	%			125,942,919				100.0	%			121,150,969				100.0	%			113,522,933				100.0	%

 

45

(1)

Digital World is required to fulfill the Financial Closing Conditions. The ability to meet the Financial Closing Conditions will not be known until the level of redemptions of Public Shares in connection with the Business Combination is known. As a result, if redemptions exceed $234.3 million (or 77% of the Trust Account assets before redemptions) the Business Combination would not close. As such, the Maximum Redemption scenario does not reflect the full amount of Public Shares that may be redeemed under Digital World’s Charter. Accordingly, if holders of more than 22,001,012 Public Shares seek to exercise such Redemption Rights, the Business Combination is not expected to close.

THE CHARTER AMENDMENT PROPOSALS (PROPOSALS 2 THROUGH 6)

To approve and adopt subject to and conditioned on (but with immediate effect therefrom) approval of each of the Business Combination Proposal, the Director Election Proposal, the Incentive Plan Proposal and the Nasdaq Proposal and the consummation of the Business Combination, a second amendment and restatement of the Digital World Charter, as set out in the Amended Charter, for the following Charter Amendment Proposals to:

 

(A)

Name Change — To provide that the name of Digital World shall be changed to “Trump Media & Technology Group Corp.” (Proposal 2);

 

(B)

Board Structure and Composition — To provide for the structure of the post-Closing Board, split into three classes of as even size as practicable, Class I, II, and III, each to serve a term of three years, except for the initial term, for which the Class I directors will be up for reelection at the first annual meeting of stockholders occurring after the Closing, for which the Class II directors will be up for reelection at the second annual meeting of stockholders occurring after the Closing and for which the Class III directors will be up for reelection at the third annual meeting of stockholders occurring after the Closing. Directors will not be able to be removed during their term except for cause. The size of the Board shall be determined by resolution of the Board but will initially be seven (7) (Proposal 3);

 

(C)

Amendment of Blank Check Provisions — To remove and change certain provisions in the Digital World Charter related to Digital World’s status as a special purpose acquisition company, including the deletion of Article IX of the Digital World Charter in its entirety (Proposal 4);

 

(D)

The Authorized Share Charter Amendment — To increase the number of authorized shares of common stock, as set forth in the Amended Charter in the form attached as Annex B hereto, to accommodate any shares to be issued in connection with (i) the Business Combination, (ii) the conversion of securities issued in Post-IPO Financings, (iii) the exercise of any Warrants, (iv) the conversion of TMTG Convertible Notes immediately prior to the Effective Time in connection with the Closing, (v) the Equity Incentive Plan and (vi) any future issuances of shares of New Digital World common stock if determined by the New Digital World Board to be in the best interests of New Digital World after the consummation of the Business Combination without incurring the risk, delay and potential expense incident to obtaining stockholder approval to increase the authorized share capital (Proposal 5); and

 

(E)

Amendment and Restatement of the Digital World Charter — Conditioned upon the approval of Proposals 2 through 5, a proposal to approve the Amended Charter in the form attached as Annex B hereto, which includes the approval of all other changes in the proposed Amended Charter in connection with replacing the Digital World Charter with the proposed Amended Charter as of the Effective Time (Proposal 6).

THE DIRECTOR ELECTION PROPOSAL (PROPOSAL 7)

To consider and vote upon a proposal to elect seven (7) directors to serve on the Combined Entity’s Board, each effective from the consummation of the Business Combination and for a term as set forth under the proposed Amended Charter or until such director’s earlier death, resignation, retirement or removal. If the

 

46

nominees identified in this proxy statement/prospectus are elected, Kashyap “Kash” Patel and W. Kyle Green will be Class I directors, serving until the Combined Entity’s 2024 annual meeting of stockholders; Linda McMahon and Donald J. Trump, Jr. will be Class II directors, serving until the Combined Entity’s 2025 annual meeting of stockholders; and Eric Swider, Devin G. Nunes and Robert Lighthizer will be Class III directors, serving until the Combined Entity’s 2026 annual meeting of stockholders, and in each case, until their respective successors are duly elected and qualified.

THE INCENTIVE PLAN PROPOSAL (PROPOSAL 8)

The proposed Equity Incentive Plan will reserve shares of New Digital World common stock equal to 7.5% of the fully diluted, and as converted, amount of New Digital World common stock to be outstanding immediately following consummation of the Business Combination, taking into account any additional shares that may be issued pursuant to the Earnout Shares. The purpose of the Equity Incentive Plan is to assist in attracting, retaining, motivating, and rewarding certain key employees, officers, directors, and consultants of New Digital World and its affiliates and promoting the creation of long-term value for stockholders of New Digital World by closely aligning the interests of such individuals with those of other stockholders. The Equity Incentive Plan authorizes the award of share-based incentives to encourage eligible employees, officers, directors, and consultants, as described below, to expend maximum effort in the creation of stockholder value.

A summary of the Equity Incentive Plan is set forth in “The Incentive Plan Proposal (Proposal 8)” section of this proxy statement/prospectus and a complete copy of the Equity Incentive Plan is attached hereto as Annex C. You are encouraged to read the Equity Incentive Plan in its entirety.

THE NASDAQ PROPOSAL (PROPOSAL 9)

To consider and vote upon a proposal to approve, for purposes of complying with Nasdaq Listing Rule 5635, (a) the issuance of up to 127,500,000 newly issued shares of New Digital World common stock in the Business Combination, which amount will be determined as described in more detail in the accompanying proxy statement/prospectus, (b) the issuance, if any, of up to 7,981,645 shares of New Digital World common stock in connection with the conversion of any Digital World Convertible Notes and Digital World Alternative Financing Notes entered into prior to the consummation of the Business Combination, (c) the issuance, if any, of up to 6,552,134 shares of New Digital World common stock in connection with the exercise of Post-IPO Warrants, (d) the issuance of up to 8,369,509 shares of New Digital World common stock issuable upon conversion of outstanding TMTG Convertible Notes immediately prior to the Effective Time in connection with the Closing and (e) the issuance under the Equity Incentive Plan of shares of New Digital World common stock equal to 7.5% of the fully diluted, and as converted, amount of New Digital World common stock to be outstanding immediately following consummation of the Business Combination under, taking into account any additional shares that may be issued pursuant to the Earnout Shares.

THE ADJOURNMENT PROPOSAL (PROPOSAL 10)

Digital World is proposing that its stockholders approve and adopt a proposal to adjourn the Digital World Special Meeting to a later date or dates, if necessary, to permit further solicitation and vote of proxies if, based upon the tabulated vote at the time of the Digital World Special Meeting, there are not sufficient votes to approve the other Proposals.

Date, Time and Place of Digital World Special Meeting

The Digital World Special Meeting will be held virtually at 10:00 a.m., Eastern Time, on     , 2024, or at such other date and time to which such meeting may be adjourned or postponed, to consider and vote upon the Proposals. We will hold the Digital World Special Meeting solely by means of remote communication.

Proxy Solicitation

Proxies may be solicited by telephone, by facsimile, by mail, on the Internet or in person. We have engaged Alliance Advisors to assist in the solicitation of proxies. If a stockholder grants a proxy, it may still vote its

 

47

shares in person if it revokes its proxy before the Digital World Special Meeting. A stockholder may also change its vote by submitting a later-dated proxy, as described in the section titled “Digital World Special Meeting — Revoking Your Proxy.”

Quorum and Required Vote for Stockholder Proposals

A quorum of Digital World stockholders is necessary to hold a valid meeting. A quorum will be present at the Digital World Special Meeting if a majority of the Digital World common stock issued and outstanding and entitled to vote at the Digital World Special Meeting is represented in person or by proxy at the Digital World Special Meeting. Abstentions and “WITHHOLD” votes will count as present for the purposes of establishing a quorum. Broker non-votes will not be counted for purposes of establishing a quorum.

The approval of the Charter Amendment Proposals requires the affirmative vote of the holders, as of the Record Date, of a majority of the then issued and outstanding shares of Class A common stock and Class B common stock, voting together as a single class. Accordingly, a Digital World stockholder’s failure to vote by proxy or to vote in person at the Digital World Special Meeting or an abstention will have the same effect as a vote “AGAINST” the Charter Amendment Proposals.

The approval of the Business Combination Proposal, the Incentive Plan Proposal and the Nasdaq Proposal requires the affirmative vote in person (which would include presence at a virtual meeting) or by proxy of the holders, as of the Record Date, of a majority of the votes cast of Class A common stock and Class B common stock, voting together as a single class, entitled to vote thereon at the Digital World Special Meeting.

The approval of the Adjournment Proposal requires the affirmative vote of a majority of the votes cast by the stockholders represented in person or by proxy and entitled to vote thereon at the Digital World Special Meeting. A Digital World stockholder’s failure to vote by proxy or to vote in person at the Digital World Special Meeting will not be counted towards the number of shares of Digital World common stock required to validly establish a quorum, and if a valid quorum is otherwise established, it will have no effect on the outcome of the vote on the Business Combination Proposal, the Incentive Plan Proposal, the Nasdaq Proposal or the Adjournment Proposal. Abstentions will be counted towards the number of shares of Digital World common stock required to validly establish a quorum but will have no effect on the outcome of the vote on the Business Combination Proposal, the Incentive Plan Proposal, the Nasdaq Proposal or the Adjournment Proposal.

The approval of the Director Election Proposal requires a plurality vote of the shares of Digital World common stock cast by the stockholders represented in person or by proxy and entitled to vote thereon at the Digital World Special Meeting. A plurality means that the individuals who receive the largest number of votes cast “FOR” are elected as directors. A Digital World stockholder’s failure to vote by proxy or to vote in person at the Digital World Special Meeting will have no effect on the Director Election Proposal. “WITHHOLD” votes will be counted towards the number of shares of Digital World common stock required to validly establish a quorum but will have no effect on the outcome of the vote on the Director Election Proposal.

The Charter Amendment Proposals, the Director Election Proposal, the Incentive Plan Proposal and the Nasdaq Proposal are conditioned on the approval of the Business Combination Proposal (and each such Proposal is cross-conditioned on the approval all the Required Proposals), and unless the Business Combination Proposal is approved, the Charter Amendment Proposals, the Director Election Proposal, the Incentive Plan Proposal and the Nasdaq Proposal will not be presented to the stockholders of Digital World at the Digital World Special Meeting.

The Adjournment Proposal is not conditioned on any other Proposal and does not require the approval of any other Proposal to be effective. It is important for you to note that in the event the Business Combination Proposal, the Charter Amendment Proposals, the Director Election Proposal, the Incentive Plan Proposal and the Nasdaq Proposal do not receive the requisite vote for approval, then Digital World will not consummate the

 

48

Business Combination. If Digital World does not consummate the Business Combination and fails to complete an initial business combination by September 8, 2024, it will be required to dissolve and liquidate its Trust Account by returning the then remaining funds in such account to its Public Stockholders, unless it seeks and obtains the approval of Digital World stockholders to amend the Digital World Charter to extend such date.

Recommendation to Digital World Stockholders

Digital World Board believes that the Proposals to be presented at the Digital World Special Meeting are in the best interests of Digital World and its stockholders and unanimously recommends that Digital World stockholders vote “FOR” the Proposals.

When you consider the recommendation of the Digital World Board in favor of approval of these Proposals, you should keep in mind that Digital World directors and officers have interests in the Business Combination that may be different from or in addition to (and which may conflict with) your interests as a stockholder. These interests include, among other things, the fact that:

 

•

unless Digital World consummates an initial business combination, Digital World’s officers and directors and the Sponsor will not receive reimbursement for any out-of-pocket expenses incurred by them to the extent that such expenses exceed the amount of available proceeds not deposited in the Trust Account;

 

•

our Sponsor holds 5,490,000 Founder Shares and 1,133,484 Placement Units, all such securities beneficially owned by Patrick Orlando, a director and former Chairman and Chief Executive Officer. In addition, Mr. Eric Swider, our Chief Executive Officer and a director, owns 7,500 Founder Shares; the anchor investors own the remaining 1,650,000 Founder Shares. All of such investments would expire worthless if a business combination is not consummated; on the other hand, if an initial business combination is consummated, such investments could earn a positive rate of return on their overall investment in the Combined Entity even if other holders of our common stock experience a negative rate of return, due to having initially purchased the Founder Shares for $25,000;

 

•

as a condition to the Digital World IPO, the Founder Shares became subject to a lock-up whereby, subject to certain limited exceptions, the Founder Shares cannot be transferred until the earlier of (A) six months after the completion of Digital World’s initial business combination; (B) subsequent to Digital World’s initial business combination, when the reported last sale price of the Class A common stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing at least 150 days after Digital World’s initial business combination; and (C) such date after its initial business combination on which Digital World completes a liquidation, merger, stock exchange, reorganization or other similar transaction that results in all of the Digital World stockholders having the right to exchange their shares of Digital World common stock for cash, securities or other property;

 

•

an aggregate of 1,133,484 Placement Units were issued to the Sponsor simultaneously with the consummation of the IPO and the underwriters’ exercise of their over-allotment option. Such Units had an aggregate market value of approximately $60.1 million based upon the closing price of Digital World’s Public Units of $53.00 per Unit on Nasdaq on February 9, 2024;

 

•

the Sponsor has agreed that the Placement Units, and all of their underlying securities, will not be sold or transferred by it until 30 days after Digital World has completed an initial business combination, subject to limited exceptions;

 

•

the Sponsor and directors and officers of Digital World have agreed not to redeem any shares of Digital World common stock they hold in connection with a stockholder vote to approve an initial business combination;

 

•

the Sponsor may loan to Digital World additional funds for working capital purposes prior to the Business Combination. As of the date of this proxy statement/prospectus, there were $4,000,700

 

49

outstanding in Digital World Convertible Notes due to our Sponsor. If the Business Combination is not consummated and Digital World does not otherwise consummate another business combination prior to September 8, 2024, then there will likely be insufficient funds to pay the Digital World Convertible Notes;

 

•

on June 2, 2023, the Company issued two promissory notes to Renatus in the aggregate principal amounts of (a) $2,000,000 and (b) $10,000,000. As of the date of this proxy statement/prospectus there were $1,232,000 outstanding in Digital World Convertible Notes due to Renatus, the proceeds of which are being used to pay working capital costs and expenses to enable Digital World to continue operating and complete an initial business combination. Mr. Swider is a founder and partner of Renatus;

 

•

if Digital World does not complete an initial business combination by September 8, 2024, the 1,133,484 shares of Class A common stock underlying the Placement Unites, the 556,742 shares of Class A common stock issuable upon conversion of the Placement Warrants and the 7,187,500 Founder Shares, of which 5,537,500 Founder Shares are held by Digital World’s Sponsor and certain current and former directors and officers, would be worthless because they are not entitled to participate in any Redemption or distribution with respect to such shares. Such Founder Shares and Placement Units had an aggregate market value of $338.0 million and $380.9 million, respectively, as of February 9, 2024, based on the closing price per Class A common stock of Digital World as of February 9, 2024 of $47.03 per share and the closing price of Digital World’s Public Units of $53.00 per Unit on Nasdaq on February 9, 2024;

 

•

if the Trust Account is liquidated, including in the event Digital World is unable to complete an initial business combination within the required time period, the Sponsor has agreed to indemnify Digital World to ensure that the proceeds in the Trust Account are not reduced below $10.20 per Public Share by the claims of prospective target businesses with which Digital World has entered into an acquisition agreement or claims of any third party for services rendered or products sold to Digital World, but only if such a vendor or target business has not executed a waiver of any and all rights to seek access to the Trust Account;

 

•

the Sponsor (including its representatives and affiliates) and Digital World’s directors and officers are, or may in the future become, affiliated with entities that are engaged in a similar business to Digital World. The Sponsor and Digital World’s directors and officers are not prohibited from sponsoring, or otherwise becoming involved with, any other blank check companies prior to Digital World completing its initial business combination. Digital World’s directors and officers also may become aware of business opportunities which may be appropriate for presentation to Digital World, and the other entities to which they owe certain fiduciary or contractual duties. Accordingly, they may have conflicts of interest in determining to which entity a particular business opportunity should be presented. These conflicts may not be resolved in Digital World’s favor and such potential business opportunities may be presented to other entities prior to their presentation to Digital World, subject to applicable fiduciary duties under DGCL. Digital World Charter provides that Digital World renounces its interest in any corporate opportunity offered to any director or officer unless such opportunity is expressly offered to such person solely in his or her capacity as a director or officer of Digital World and such opportunity is one Digital World is legally and contractually permitted to undertake and would otherwise be reasonable for Digital World to pursue, and to the extent the director or officer is permitted to refer that opportunity to Digital World without violating another legal obligation;

 

•

Mr. Swider is expected to be appointed as a director of the Combined Entity after the consummation of the Business Combination, Mr. Swider may in the future receive cash fees, stock options or stock awards that the Combined Entity determines to pay to its directors; and

 

•

that Digital World has issued Digital World Convertible Notes to certain officers, directors and affiliates pursuant to the Convertible Note Compensation Plan approved by the requisite holders of Class A common stock at the annual meeting of Digital World’s stockholders on December 19, 2023. These notes collectively represent an aggregate amount of $9,651,250 and may be convertible upon the Closing of the Business Combination into a maximum of 965,125 shares of Class A common stock,

 

50

assuming each recipient chooses to convert their entire promissory note amount into Class A common shares. If we fail to close the Business Combination such notes would then be worthless.

These interests may influence Digital World’s directors in making their recommendation that you vote in favor of the approval of the Business Combination.

Emerging Growth Company

Digital World is currently and, following the consummation of the Business Combination, the Combined Entity will be, an “emerging growth company,” as defined in the Securities Act, as modified by the Jumpstart Our Business Startups Act (“JOBS Act”). Digital World has taken, and the Combined Entity may continue to take, advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies, including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002 (“Sarbanes-Oxley Act”), reduced disclosure obligations regarding executive compensation in Digital World’s periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. As a result, stockholders of Digital World and the Combined Entity may not have access to certain information they may deem important.

Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable. Digital World has not elected to opt out of such extended transition period, which means that when a standard is issued or revised and it has different application dates for public or private companies, Digital World (and, following the Business Combination, the Combined Entity), as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of Digital World’s and the Combined Entity’s financial statements with certain other public companies difficult or impossible because of the potential differences in accounting standards used.

Digital World (and following the Business Combination, the Combined Entity) will remain an emerging growth company until the earliest of: (i) the last day of the fiscal year following the fifth anniversary of the closing of the Digital World IPO; (ii) the last day of the fiscal year in which Digital World (and following the Business Combination, the Combined Entity) has total annual gross revenue of at least $1.07 billion; (iii) the last day of the fiscal year in which Digital World (and following the Business Combination, the Combined Entity) is deemed to be a “large accelerated filer” as defined in Rule 12b-2 under the Exchange Act, which would occur if the market value of Digital World’s (and following the Business Combination, the Combined Entity’s) common stock held by non-affiliates exceeded $700.0 million as of the last business day of the second fiscal quarter of such year; or (iv) the date on which Digital World (and following the Business Combination, the Combined Entity) has issued more than $1.0 billion in non-convertible debt securities during the prior three-year period.

Summary Risk Factors

TMTG’s business and an investment in New Digital World common stock are subject to numerous risks and uncertainties. In evaluating the proposals set forth in this proxy statement/prospectus, you should carefully read this proxy statement/prospectus, including the financial statements and annexes attached hereto, and especially

 

51

consider the factors discussed in the section entitled “Cautionary Note Regarding Forward-Looking Statements” and “Risk Factors.” Some of these risks include:

Risks Related to Digital World and the Business Combination

 

•

Changes in laws or regulations or how such laws or regulations are interpreted or applied, or a failure to comply with any laws or regulations, may adversely affect Digital World’s business.

 

•

The ability of Digital World’s Public Stockholders to exercise their Redemption Rights may not allow Digital World to complete the Business Combination.

 

•

Notwithstanding Digital World’s settlement with the SEC, the SEC may further delay declaring this registration statement effective or disapprove this transaction and issue a stop order or similar order which could materially delay or materially impede the consummation of the Business Combination.

 

•

Digital World has not obtained an opinion from an independent investment banking firm or another independent firm.

 

•

There is no assurance that Digital World’s diligence will reveal all material risks.

 

•

Digital World’s management has identified a material weakness in its internal control over financial reporting. If it is unable to develop and maintain an effective system of internal control over financial reporting, Digital World may not be able to accurately report its financial results in a timely manner, which may adversely affect investor confidence in us and materially and adversely affect our business and operating results.

 

•

Digital World was in the past, and continues to be, subject to inquiries, exams, pending investigations, or enforcement matters.

 

•

Patrick Orlando, Digital World’s former Chairman and Chief Executive Officer, a current member of our Board and a controlling affiliate of our Sponsor has, in recent weeks, expressed a desire for additional compensation (above his interest in the Founder Shares).

 

•

As a result of the prolonged delay due to the Investigation, Digital World has incurred significant unanticipated expenses well in excess of the working capital loans provided by our Sponsor, which have required Digital World to seek alternative sources of working capital to fund its day-to-day operations and such additional and unanticipated costs and expenses through Post-IPO Financings.

Risks Related to TMTG

 

•

TMTG has a limited operating history making it difficult to evaluate TMTG’s business and prospects and may increase the risks associated with your investment.

 

•

TMTG’s actual financial position and results of operations may differ materially from the expectations of TMTG’s management.

 

•

If Truth Social fails to develop and maintain followers or a sufficient audience, if adverse trends develop in the social media platforms generally, or if President Trump were to cease to be able to devote substantial time to Truth Social, TMTG’s business would be adversely affected.

 

•

TMTG has identified a material weaknesses in its internal control over financial reporting, and TMTG may identify additional material weaknesses in its previously issued financial statements and in the future, which may cause the Combined Entity to fail to meet its reporting obligations or result in material misstatements of its financial statements.

 

•

TMTG’s independent registered public accounting firm has indicated that TMTG’s financial condition raises substantial doubt as to its ability to continue as a going concern.

 

•

TMTG’s estimates of market opportunity and forecasts of market growth may be inaccurate.

 

•

TMTG’s business is subject to complex and evolving U.S. and foreign laws and regulations regarding privacy, data protection, and other matters.

 

 

52

•

In the future, TMTG may be involved in numerous class action lawsuits and other litigation matters.

 

•

Computer malware, viruses, hacking, and phishing attacks, and spamming could harm TMTG’s business and results of operations.

Risks Related to TMTG’s Chairman President Donald J. Trump

 

•

TMTG’s success depends in part on the popularity of its brand and the reputation and popularity of its Chairman, President Donald J. Trump.

 

•

The terms of a license agreement with President Trump is not terminable by TMTG when it may be desirable to TMTG. The license agreement does not require President Trump to use Truth Social in certain circumstances, including in connection with posts that President Trump deems, in his sole discretion, to be politically related.

 

•

Because President Trump is a candidate for president, he may divest his interest in Truth Social and may cease any involvement in its management.

 

•

TMTG depends on numerous third-parties to operate successfully, and many of these third parties may not want to engage with TMTG to provide any services.

Risks Related to Ownership of New Digital World common stock

 

•

Nasdaq may delist New Digital World’s securities from trading on its exchange.

 

•

The Business Combination may decrease the market price of New Digital World’s common stock.

 

•

New Digital World stockholders may experience dilution in the future.

 

•

TMTG’s management team may not successfully manage its transition to being a public company.

 

•

President Trump will hold at least 58.1% of the outstanding shares of New Digital World common stock, which control limits or precludes other stockholders’ ability to influence the business.

Risks Related to Redemption

 

•

The ability to execute Digital World and TMTG’s strategic plan could be negatively impacted to the extent a significant number of stockholders choose to redeem their shares in connection with the Business Combination.

 

•

There is no guarantee that a Digital World Public Stockholder’s decision whether to redeem its shares of Digital World common stock for a pro rata portion of the Trust Account will put such stockholder in a better future economic position.

 

53

SELECTED HISTORICAL CONSOLIDATED FINANCIAL INFORMATION OF DIGITAL WORLD

The summary statements of operations data for the years ended December 31, 2022 and 2021 and the summary balance sheet data as of December 31, 2022 and 2021 are derived from Digital World’s audited financial statements included elsewhere in this proxy statement/prospectus. The summary statements of operations data for the nine month periods ended September 30, 2023 and September 30, 2022 and the summary balance sheet data as of September 30, 2023 are derived from Digital World’s unaudited interim condensed consolidated financial statements, each of which is included elsewhere in this proxy statement/prospectus. The unaudited interim condensed consolidated financial data set forth below has been prepared on the same basis as Digital World’s audited financial statements and, in the opinion of Digital World’s management, reflect all adjustments, consisting only of normal recurring adjustments, that are necessary for the fair statement of such data.

The historical results presented below are not necessarily indicative of the results to be expected for any future period. You should carefully read the following selected financial information in conjunction with the section titled “Management’s Discussion and Analysis of Financial Condition and Results of Operations of Digital World” and Digital World’s financial statements and the related notes appearing elsewhere in this proxy statement/prospectus.

Statements of Operations Data:

 

		For the Nine Months Ended September 30,								Year Ended December 31,
		2023				2022				(As restated) 2022				2021
Formation and operating costs		$	7,899,200			$	3,377,588			$	8,716,023			$	1,191,593
Franchise tax expense			20,639,030				150,000				200,000				200,000
Loss from operation costs			(28,770,730	)			(11,491,796	)			18,499,257				(1,391,593	)
Other income and expenses:
Interest earned on cash held in Trust Account			10,404,747				1,752,484				4,257,469				7,098
Net loss		$	(20,006,348	)		$	(10,096,571	)		$	(15,642,548	)		$	(1,384,495	)
Weighted average shares outstanding of Class A common stock			30,019,049				30,027,234				30,026,769				9,404,134
Basic and diluted net income per Class A common stock		$	(0.51	)		$	(0.27	)		$	(0.42	)		$	(0.08	)
Weighted average shares outstanding of Class B common stock			7,187,500				7,187,500				7,187,500				7,187,500
Basic and diluted net income per Class B common stock		$	(0.54	)		$	(0.27	)		$	(0.42	)		$	(0.08	)

 

54

Statements of Balance Sheet Data:

 

		As of September 30,				As of December 31,
		2023				(As restated) 2022				2021
Balance Sheet Data:
Total assets		$	310,481,457			$	300,499,990			$	293,990,852
Total liabilities		$	63,818,265			$	32,535,352			$	10,746,035
Class A common stock subject to possible Redemption		$	306,128,902			$	298,951,176			$	293,250,000
Working capital (deficit)(1)		$	(50,470,178)			$	267,964,638			$	(114,832	)
Total stockholders’ deficit		$	(59,465,710)			$	(31,974,608	)		$	(10,005,183	)

 

(1)	Working capital (deficit) is defined as total current assets minus total current liabilities

 

55

SELECTED HISTORICAL FINANCIAL INFORMATION OF TMTG

The summary statements of operations data for the year ended December 31, 2022 and for the period from February 8, 2021 (date of inception) to December 31, 2021 and the summary balance sheet data as of December 31, 2022 and for the period from February 8, 2021 (date of inception) to December 31, 2021 are derived from TMTG’s audited financial statements included elsewhere in this proxy statement/prospectus. The summary statements of operations data for the nine month periods ended September 30, 2023 and September 30, 2022 and the summary balance sheet data as of September 30, 2023 are derived from TMTG’s unaudited interim condensed consolidated financial statements, each of which is included elsewhere in this proxy statement/prospectus. The unaudited interim condensed consolidated financial data set forth below has been prepared on the same basis as TMTG’s audited financial statements and, in the opinion of TMTG’s management, reflect all adjustments, consisting only of normal recurring adjustments, that are necessary for the fair statement of such data.

The historical results presented below are not necessarily indicative of the results to be expected for any future period. You should carefully read the following selected financial information in conjunction with the section titled “Management’s Discussion and Analysis of Financial Condition and Results of Operations of TMTG” and TMTG’s financial statements and the related notes appearing elsewhere in this proxy statement/prospectus.

Statement of Operations Data:

 

		For the Nine Months Ended September 30,								Year Ended December 31,				For the period from February 8 (inception) through December 31,
in thousands, except share and per share data		2023				2022				2022				(As restated) 2021
Total Revenue		$	3,379.6			$	237.0			$	1,470.5			$	—
Cost of revenue			123.9				—				54.5				—
Gross profit			3,255.7				237.0				1,416.0				—
Operating costs and expenses:
Research and development			7,212.1				10,469.9				13,633.1				2,571.3
Sales and marketing			978.1				536.1				625.9				381.7
General and administrative			5,666.6				8,527.6				10,345.6				3,419.2
Depreciation and Amortization			47.6				42.6				58.7				6.5
Loss from operations		$	(10,648.7	)		$	(19,339.2	)		$	(23,247.3	)		$	(6,378.7	)
Other income			—				—				—				2,123.3
Interest expense			(37,702.5	)			(1,312.0	)			(2,038.7	)			(654.3	)
Change in fair value of derivative liabilities			(660.2	)			62,156.0				75,809.9				(54,186.4	)
Profit/(loss) from operations before income taxes			(49,011.4	)			41,504.8				50,523.8				(59,096.1	)
Income tax expense/(benefit)			—				—				.2				—
Net profit/(loss)		$	(49,011.4	)		$	41,504.8			$	50,523.6			$	(59,096.1	)
Weighted-average common shares used in net loss per share attributable to common stockholders, basic and diluted			100,000,000				100,000,000				100,000,000				100,000,000
Net loss per common share attributable to common stockholders, basic and diluted			(0.49	)			.42				.51				(0.59	)

 

56

Statement of Balance Sheet Data:

 

in thousands		As of September 30, 2023				As of December 31, 2022				For the period from February 8 (inception) through December 31,
										2021
Cash and cash equivalents		$	1,839.0			$	9,808.4			$	18,734.4
Total assets			2,910.7				11,236.7				19,251.2
Total liabilities			60,494.7				19,809.3				78,347.4
Working capital(1)			(55,050.4	)			(8,805.1	)			18,282.1
Accumulated deficit			(57,584.0	)			(8,572.6	)			(59,096.2	)
Total stockholders’ deficit		$	(57,584.0	)		$	(8,572.6	)		$	(59,096.2	)

 

(1)	Working capital is defined as total current assets minus total current liabilities

 

57

SUMMARY UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION

Defined terms included below shall have the same meaning as terms defined and included elsewhere in this proxy statement/prospectus.

The following summary unaudited pro forma condensed combined financial data, (the “summary pro forma data”) gives effect to the Business Combination described in the section entitled “Unaudited Pro Forma Condensed Combined Financial Information.” The Business Combination is expected to be accounted for as a reverse recapitalization, with no goodwill or other intangible assets recorded, in accordance with U.S. GAAP. Under this method of accounting, Digital World will be treated as the “acquired” company for financial reporting purposes. The net assets of Digital World will be stated at historical cost, with no goodwill or other intangible assets recorded.

The summary unaudited pro forma condensed combined balance sheet data as of September 30, 2023 gives pro forma effect to the Business Combination and related transactions as if they had occurred on September 30, 2023. The summary unaudited pro forma condensed combined statement of operations data for the nine months ended September 30, 2023 and for the year ended December 31, 2022 give pro forma effect to the Business Combination and related transactions as if they had occurred on January 1, 2022.

The summary pro forma data have been derived from, and should be read in conjunction with, the unaudited pro forma condensed combined financial information of the Combined Entity appearing elsewhere in this proxy statement/prospectus and the accompanying notes. The unaudited pro forma condensed combined financial information is based upon, and should be read in conjunction with, the historical consolidated financial statements of Digital World and related notes and the historical financial statements of TMTG and related notes, in each case, included in this proxy statement/prospectus. The summary pro forma data have been presented for informational purposes only and are not necessarily indicative of what the Combined Entity’s financial position or results of operations actually would have been had the Business Combination and the other transactions contemplated by the Merger Agreement (described elsewhere in this proxy statement/prospectus) been completed as of the dates indicated. In addition, the summary pro forma data do not purport to project the future financial position or operating results of the Combined Entity.

For illustrative purposes the unaudited pro forma condensed combined financial information has been prepared assuming two alternative levels of additional Redemptions of Digital World Class A common stock:

 

•

Assuming Minimum Additional Redemptions (“Minimum Redemption”) — This scenario assumes that no shares of Digital World Class A common stock are redeemed; and

 

•

Assuming Maximum Redemptions (“Maximum Redemption”) — This scenario assumes the Redemption of 22,001,012 shares of Digital World Class A common stock, for aggregate payment of approximately $234.3 million from the Trust Account), so that Digital World retains at least $5,000,001 in net tangible assets and $60 million in cash immediately prior to or upon the consummation of the Business Combination.

Under both redemption scenarios, all issued and outstanding shares of TMTG common stock, as of the date of this proxy statement/prospectus are being exchanged for 87,500,000 shares of Digital World Class A common stock.

Assuming no Redemption, on a pro forma estimated basis, TMTG’s existing securityholders will hold 95,869,509 shares of Class A common stock of the Combined Entity immediately after the Closing, which approximates a 70.7% ownership level. Assuming Maximum Redemption, on a pro forma estimated basis, TMTG will hold common stock of the Combined Entity approximating an 84.4% ownership level.

 

58

		Minimum Redemption								33.33% Redemption								50% Redemption								Maximum (77%) Redemption (1)
DWAC SPAC public shareholder shares			28,745,952				21.2	%			19,164,926				15.2	%			14,372,976				11.9	%			6,744,940				5.9	%
SPAC private placement shares			1,133,484				0.8	%			1,133,484				0.9	%			1,133,484				0.9	%			1,133,484				1.0	%
Underwriter IPO shares			143,750				0.1	%			143,750				0.1	%			143,750				0.1	%			143,750				0.1	%
SPAC sponsor promote (primarily Founder Shares)			9,631,250				7.1	%			9,631,250				7.6	%			9,631,250				7.9	%			9,631,250				8.6	%
Total DWAC			39,869,509				29.3	%			30,073,410				23.9	%			25,281,460				20.9	%			17,653,424				15.6	%
TMTG Rollover equity shares for TMTG shareholders			87,500,000				64.6	%			87,500,000				69.5	%			87,500,000				72.2	%			87,500,000				77.1	%
TMTG convertible note shares			8,369,509				6.2	%			8,369,509				6.6	%			8,369,509				6.9	%			8,369,509				7.4	%
Total TMTG . . . . . .			95,869,509				70.7	%			95,869,509				76.1	%			95,869,509				79.1	%			95,869,509				84.4	%
Total			135,523,945				100.0	%			125,942,919				100.0	%			121,150,969				100.0	%			113,522,933				100.0	%

 

(1)

Digital World is required to fulfill the Financial Closing Conditions. The ability to meet the Financial Closing Conditions will not be known until the level of redemptions of Public Shares in connection with the Business Combination is known. As a result, if redemptions exceed $234.3 million (or 77% of the Trust Account assets before redemptions) the Business Combination would not close. As such, the Maximum Redemption scenario does not reflect the full amount of Public Shares that may be redeemed under Digital World’s Charter. Accordingly, if holders of more than 22,001,012 Public Shares seek to exercise such Redemption Rights, the Business Combination is not expected to close.

The foregoing ownership percentages with respect to the Combined Entity following the Business Combination are based on the assumption that there are no adjustments for the outstanding Public Warrants or Placement Warrants issued by Digital World and (A) exclude the exercise of outstanding Warrants and the conversion of securities issued in the Post-IPO Financings and (B) assume that (i) there are no Redemptions of any shares by Digital World’s Public Stockholders in connection with the Business Combination and (ii) no awards are issued under the Equity Incentive Plan. If the actual facts are different than these assumptions (which they are likely to be), the percentage ownership retained by the Digital World’s existing stockholders in the Combined Entity will be different. Upon consummation of the Business Combination, and subject to approval of the Incentive Plan Proposal, TMTG’s executive officers are expected to receive grants of stock options and restricted stock units under the Equity Incentive Plan from time to time as determined by the Compensation Committee. Each TMTG Convertible Note that is issued and outstanding immediately prior to the Effective Time will automatically convert immediately prior to the Effective Time into a number of shares of TMTG common stock as such TMTG Convertible Note would automatically convert upon the consummation of the Business Combination, in accordance with each such TMTG Convertible Note.

If the actual facts are different than these assumptions, then the amounts and shares outstanding in the unaudited pro forma condensed combined financial information will be different.

 

59