Hey there, boys and girls, let's play a round of the new game show "Wuddaya Seize First?"

[LetMyPeopleVote]

42. Trump-Linked Digital World Acquisition Hits 7-Week Low As Ex-President Struggles To Secure Bond In Civil Fraud Case

The market seems to be concerned about the lack of a bond

Link to tweet

https://www.benzinga.com/markets/equities/24/03/37810916/trumps-spac-for-truth-social-hits-7-week-low-as-ex-president-struggles-to-secure-bond-in-civil-f

On Monday, the stock of Trump-linked Digital World Acquisition Corp

What Happened: The shares of DWAC plummeted by as much as 8.74% to $35.58 on Monday, the lowest level since Jan. 30. This comes as Trump’s attempts to secure a bond to cover a $454 million judgment in a New York civil fraud case were rejected by 30 surety companies, bringing him closer to the potential seizure of his properties, Reuters reported.

Trump’s legal team proposed that he be allowed to post a $100 million bond while he appeals the judgment. Earlier this month, Trump posted a $91.6 million bond to cover a defamation verdict for E. Jean Carroll as he appeals a case stemming from her accusation of rape against him.

The market is correct to be concerned. This is low market cap stock that appears to be very overvalued given that there has been only losses and no real prospect of earnings in the foreseeable future. I would be surprised to see any major company take this stock as collateral.

The trouble with your prediction is that AG James has the ability to levy on and foreclose on TFG's stock at any time after March 25 unless a bond is posted. The fact that the stock cannot be sold by TFG will not prevent AG James from levying on and selling such stock in a foreclosure sale. I have done a number of private/public foreclosure sales of stock over the years and I am working on one such sale now. Under a series of SEC no action letters, AG James can hold a public foreclosure sale of TFG's stock in the merged entity and bid whatever price that she thinks this stock is worth. The result of such foreclosure sale will be that TFG would not have any ownership in the new merged entity which will have an effect on the value of the company in the minds of reasonable investors.

So far none of the 30 companies who rejected TFG's bond request have agree to take this stock as a collateral. I will be surprised to see any company taking the risk of taking a low cap/thinly traded stock with no earnings as collateral. This will be fun to watch.