Former President Donald Trump is set to receive an additional 36 million shares of Trump Media on Tuesday, as part of an "earnout" bonus valued at over $1.25 billion based on Monday's share price.
Trump Media, the owner of the Truth Social app, was trading at approximately $35 per share on Monday.
The stock price needs to reach at least $17.50 by the close of trading on Tuesday, which is double the minimum benchmark price, for Trump to qualify for the extra earnout shares. This requirement stipulates that the benchmark must be met for 20 trading days within a 30-trading day period starting from March 25. Tuesday marks the 20th day, and it is highly unlikely that the share price will drop below the benchmark by the end of the day.
As of 12:17 p.m. ET, Trump Media's share price was down approximately 1.8%.
Adding the 36 million additional shares to the 78.75 million shares he already owns as the company's majority shareholder, Trump's total stake in Trump Media would be valued at over $4 billion at a share price of $35.
Under the merger deal that combined Trump Media with a publicly traded shell company, Digital World Acquisition Corp, Trump Media has the authority to issue up to 40 million earnout shares. The securities filing indicates that some or all of the remaining shares will likely be issued to Trump Media's executive officers as part of an incentive plan.
Meanwhile, Trump was present in a New York City courtroom on Monday, where opening statements were delivered in his criminal hush money trial. The trial will resume on Tuesday for the presumptive Republican presidential nominee.
Trump Media & Technology Group Corp., the merged company, began trading publicly under the DJT ticker on March 26, starting at an opening price of $70.90 per share. The share price briefly reached nearly $80 that day, briefly giving the company a market capitalization exceeding $9 billion. However, despite reporting a 2023 net loss of $58 million and revenue of just $4.1 million, the share price has since plummeted, closing at nearly 68% below its opening price by April 15.
While the stock price saw a significant increase last week, Trump Media shares were still trading around 50% lower than their debut price as of Monday, resulting in a substantial loss of market capitalization for the company. Despite the lower stock price, Trump is expected to receive all of his earnout shares.
