Judge rules Trump Media breached stock contract with early investor

• Trump Media breached an agreement with one of the investors that helped the company go public and must grant the sponsor a larger share of stock, a judge ruled.
• The blank-check firm DWAC underestimated the amount of stock that investor ARC Global should get following the merger that took Trump Media public, the judge ruled.
• The ruling came days before DJT's majority-owner Donald Trump and others will be free to start selling their shares in the Truth Social maker.

Trump Media breached an agreement with one of the investors that helped the company go public, and must grant the investor a larger share of its stock, a judge ruled.

The order in Delaware Chancery Court on Monday came just three days before the investor, ARC Global, and other insiders — including majority-owner Donald Trump — will be free to start selling their shares in the company behind Truth Social.

If those insiders opt to cash out their stakes, they could be in line for a major pay day. But they could also tank investor confidence and drive down Trump Media's value, which has already fallen by billions of dollars amid a monthslong stock slump.

The judge in the Delaware case, Vice Chancellor Lori Will, determined that the blank-check firm Digital World Acquisition Corp., or DWAC, underestimated the amount of stock that was due to ARC Global, as part of the merger that took Trump Media public in March.

But Will, in her 44-page ruling, also found that the stock-conversion ratio proposed by ARC was too high. And she rejected a number of other claims put forward by both ARC and DWAC as "meritless" diversions.

ARC bought Class B shares of DWAC, a special purpose acquisition company intended to merge with another business and go public.

After DWAC merged with