Trump Media to Grant Donald Trump $1.25 Billion Stock Bonus This Week

By John Lopez

Apr 22, 2024 04:19 PM EDT

Donald Trump is expected to receive a substantial stock bonus this week from Trump Media & Technology Group Corp., which owns Truth Social. The bonus will consist of an additional 36 million shares valued at more than $1.25 billion.

This move follows significant volatility in the company's stock price in recent weeks.

Donald Trump to Receive Massive Stock Bonus from Trump Media

Trump's bonus depends on Trump Media's stock price, which meets specific benchmarks. Specifically, the stock must maintain a minimum price of $17.50 by the end of trading on Tuesday, with Monday's price hovering around $35, well above the required level.

This bonus arrangement is part of an "earnout" agreement, which states that Trump will be eligible for additional shares if the benchmark is met for 20 trading days within a 30-day window. Tuesday marks the 20th day, and the chances of the stock falling below the required price are slim.

If the bonus is granted, Trump's total stake in Trump Media will exceed $4 billion, ensuring his position as majority shareholder. This significant increase in Trump's fortune reflects the stock's performance since the company's merger and public trading debut, which is crucial for Trump's ongoing legal battles.

Despite initially having a market capitalization of more than $9 billion, Trump Media's share price has since fallen sharply, trading roughly 50% lower than its opening price.

Opening Statements Begin In Former President Donald Trump's New York Hush Money Trial — NEW YORK, NEW YORK - APRIL 22: Former U.S. President Donald Trump speaks to the media at the end of the day at Manhattan Criminal Court during his trial for allegedly covering up hush money payments on April 22, 2024 in New York City. Trump was charged with 34 counts of falsifying business records last year, which prosecutors say was an effort to hide a potential sex scandal, both before and after the 2016 presidential election.
(Photo : Photo by Victor J. Blue - Pool/Getty Images)

What's Next?

Analysts remain cautious about Trump Media's future prospects, citing concerns about the company's fundamentals and overvaluation.

Trump Media reported losses of $49 million in the first nine months of the previous year, with minimal revenue. Additionally, the company's market capitalization has fallen from $10 billion to $4.78 billion in just one month, signaling investor skepticism (via Fortune).

While Trump's bonus represents a significant windfall, it comes with restrictions. His shares are subject to a lock-up provision, preventing him from selling them for six months following the merger.

Although the company's board has not yet moved to amend this provision, any significant sale of Trump's shares could further impact Trump Media's valuation.

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