Trump Media (DJT) has recently made headlines by distributing thousands of shares of its company stock to several key figures connected to President Donald Trump, including his nominee for FBI director, Kash Patel, his eldest son Donald Trump Jr., and his pick for Education secretary, Linda McMahon, all of whom serve on the company’s board. These actions were disclosed in new regulatory filings with the Securities and Exchange Commission (SEC), which also named former U.S. trade representative Robert Lighthizer, Eric Swider, and Kyle Green as recipients of the same stock awards.
Each board member was awarded 25,946 shares, which, based on the trading close at $30.04 per share on the day of the award, have a paper value exceeding $779,400. However, these shares come with significant restrictions; only 25% vest immediately, allowing for potential sale, while the rest are scheduled to vest in nine quarterly installments over the next two years. This timing means that the immediate financial benefit is limited, with the first batch of freely tradable shares amounting to about $195,000 per director.
The timing of these stock grants has raised eyebrows, especially given their announcement shortly after Patel’s Senate confirmation hearing for the FBI directorship. Critics argue that such financial entanglements could represent conflicts of interest, especially considering Trump’s recent business activities and his transfer of a majority stake in Trump Media to a revocable trust where he is the sole beneficiary and Trump Jr. serves as trustee. This move was made weeks after Trump’s victory in the presidential election, suggesting a strategy to manage his business interests while in office.
Moreover, Trump Media isn’t just sticking to its core business of running Truth Social; it has announced plans to expand into financial services. This diversification could potentially increase the company’s influence and revenue streams but also complicates the narrative around conflict of interest.
The structure of these stock awards as restricted stock units (RSUs) reflects a common practice in executive compensation aimed at incentivizing long-term commitment to the company’s growth. However, in the context of political appointments and public service, the optics of these awards have fueled debate over the ethics of intertwining personal financial gain with public office duties.
The market reacted to these developments with DJT stock trading at around $31.50 per share by mid-afternoon on Friday, indicating continued investor interest despite or perhaps because of the controversy surrounding these stock distributions. Critics and supporters alike are watching closely, as the implications of these actions could resonate well beyond the boardroom into the realm of public policy and governance integrity.
h/t CNBC
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