Trump Media payday: What Truth Social executives got paid in stock and compensation

The
merger
that
led
to


Trump
Media
shares
becoming
publicly
traded
is
also
paying
off
for
top
executives
and
other
insiders
at
the
company,
which
owns
the

Truth
Social
app
regularly
used
by
former
President

Donald
Trump.

Corporate
filings
from
Trump
Media
—
which
reported
a
net
loss
of
$58
million
last
year
on
revenue
of
just
$4.1
million
—
detail
the
salaries,
retention
bonuses
and

stock
allocations
for
CEO
Devin
Nunes
and
other
executives.

Trump
himself
is
by
far
the
biggest
shareholder,
with
78.75
million

shares
that
give
him
a
stake
of
nearly
58%
of
the

social
media
company’s
common
stock.

The
number
of
people
financially
rewarded
in
the
early
stages
of
the
company
is
limited.
Besides
the
former
president,
it
includes
the
chief
financial
officer,
chief
operating
officer,
and
several
people
close
to Trump.

Trump
Media
began
trading
on
the
Nasdaq
Stock
Market
under
the
ticker
DJT
—
the
former
president’s
initials
—
on
March
26
following
its
merger
with
the
shell
company
Digital
World
Acquisition
Corp.

Trump
could
receive
another
36
million
in
so-called
earnout
shares
over
the
next
three
years,
provided
that
Trump
Media’s
stock
stays
above
certain
benchmarks.

Those
thresholds
for
the
share
price
are
well
below
where
Trump
Media
stock
was
trading
on
Monday,
when
it

closed
at
$37.17,
down
more
than
8%.

“It
sounds
like
more
of
a
contract
that
you
give
to
an
executive
than
to
a
controlling
shareholder,”
said
Kevin
Murphy,
a
professor
at
the
University
of
Southern
California’s
business
and
law
schools,
in
an
interview.

“The
former
president
is
not
an
executive
of
the
company,”
Murphy
noted.

Murphy
was
also
struck
by
details
revealed
in
a
10-K
filing
with
the
Securities
and
Exchange
Commission.
The
filing
disclosed
that
Trump
Media
awarded
company
stock
to
Nunes,
chief
financial
officer
Phillip
Juhan
and
chief
operating
officer
Andrew
Northwall.

Trump
Media
issued
promissory
notes,
a
type
of
legally
binding
IOUs,
to
the
executives,
at
some
point
when
it
was
still
a
privately
held
company,
according
to
the
filing.
The
total
value
of
the
notes
issued
was
$6.25
million,
broken
up
into
$1.15
million
for
Nunes,
$4.9
million
for
Juhan
and
$200,000
for
Northwall.

After
the
merger
with
DWAC,
the
$6.25
million
that
the
company
owed
the
three
men
was
“automatically
converted
…
into
625,000
shares
of
Company
common
stock.”

Nunes
got
115,000
shares,
Juhan
received
490,000
shares
and
Northwall
got
20,000
shares,
the
SEC
filing
said.

Murphy
said
the
allocation
appears
to
reflect
the
opening
$10
per
share
price
of
Digital
World
Acquisition
Corp.
on
Oct.
1,
2021,
the
first
day
that
DWAC
was
publicly
traded.

At
the
time,
DWAC
was
merely
one
of
hundreds
of
empty
special
purpose
acquisition
companies,
commonly
known
as
SPACs,
formed
to
go
public,
then
seek
a
merger
partner
and
take
that
partner
public.
Multiplying
each
man’s
share
allocation
by
the
par
value
for
every
new
SPAC,
$10,
adds
up
to
the
face
value
of
the
promissory
notes
Trump
Media
had
given
them.

“I
haven’t
seen
it
before,”
Murphy
said,
referring
to
the
method
of
using
promissory
notes
that
convert
to
stock
to
give
shares
to
executives.
“I
don’t
know
why
they
structured
it
this
way.”

“We
don’t
even
know
why
these
promissory
notes
were
issued,”
he
said,
noting
that
the
rationale
for
the
notes
was
not
disclosed
in
the
company’s
SEC
filing.

The
three
top
executives,
like
Trump
himself,
are
currently
barred
from
selling
any
of
their
common
stock
in
Trump
Media
for
the
next
six
months.

CNBC
asked
a
spokeswoman
for
Trump
Media
why
promissory
notes
were
used
to
grant
stock
to
the
executives.

CNBC
also
asked
the
spokeswoman
about
other
details
in
the
10-K
filing,
such
as
why
Trump
himself
was
given
the
opportunity
to
be
awarded
significantly
more
shares
if
the
price
benchmarks
are
met.

The
spokeswoman
did
not
answer
these
questions.

Instead,
she
replied:
“Although
we’ve
only
been
a
public
company
for
about
a
week,
we’ve
already
come
to
expect
this
buffet
of
false
insinuations
and
outright
lies
from
the
politicized
shills
at
CNBC.”

While
Trump
Media’s
share
price
soared
to
nearly
$80
right
after
the
stock
began
public
trading,
it
closed
at
$37.17
per
share
on
Monday.

Murphy
is
among
those
who
believe
Trump
Media’s
stock
remains
overvalued,
given
its
meager
revenue
and
relatively
low
numbers
of
Truth
Social
users
compared
to
other,
much
bigger
social
media
companies.

But
Murphy
is
not
alone.

Despite
the
fact
that Trump Media
stock
is,
by
far,
the
most
expensive
U.S.
stock
to
sell
short,
there
was
strong
demand
for
the
relatively
few
shares
remaining
available
to
borrow
as
part
of
a
short
sale,
according
to
the
financial
data
marketplace
platform
S3
Partners. 

“What
I’m hearing on
the
Street
is
that
if
[an
amount]
of
stock
becomes
available,
shorts
are
taking
it
down,”
Ihor
Dusaniwsky,
managing
director
of
predictive
analytics
at
S3
Partners
told
CNBC
last
week.

The
number
of
shares
that
the
trio
of
executives
received
is
fewer
than
the
number
of
restricted
stock
units
they
were
supposed
to
have
gotten
under
their
original
employment
agreements
with
Trump
Media.

Those
would
have
allocated
145,000
RSUs
for
Nunes,
520,000
RSUs
for
Juhan
and
50,000
RSUs
for
Northwall,
according
to
the
filing.

However,
after
they
each
received
a
promissory
note
from
the
company,
the
original
RSU
grants
were
eliminated
in
subsequent
employment
agreements.

Murphy
noted
that
in
both
scenarios,
Juhan
received
much
more
stock
than
Nunes,
his
nominal
boss,
was
granted.

“I
don’t
understand
why
he
gets
so
much
more
than
the
CEO,”
Murphy
said
of
Juhan.

CNBC
posed
this
question
to
Trump
Media’s
spokeswoman,
but
she
did
not
answer
it.

Under
new
employment
deals,
each
of
the
three
executives
will
receive
a
$600,000
“retention
bonus”
payable
within
the
next
three
weeks.
Each
“will
be
eligible
to
receive
discretionary
equity
awards
pursuant
to
the
Equity
Incentive
Plan,”
the
filing
said.

The
filing
also
noted
that
Trump
Media
now
“intends
on
negotiating
new
employment
agreements
with
Messrs.
Nunes,
Juhan
and
Northwall.”

Nunes,
a
50-year-old
former
Republican
congressman
from
California,
also
received
a
salary
of
$750,000
in
both
2023
and
2022,
according
to
SEC
filings.

In
January,
Nunes
got
a
raise,
lifting
his
annual
base
salary
to
$1
million,
according
to
the
filing.

Nunes’
employment
agreement
also
makes
him
eligible
to
participate
in
the
company’s
“annual
bonus
plan,
if
any,”
the
filing
noted.

Any
bonus
would
be
subject
to
vesting
and
other
terms
determined
by
the
board
of
directors
of
Trump
Media,
which
as
of
late
2023
had
just
36
employees.

Juhan,
the
49-year-old
CFO
who
previously
held
that
same
position
at
a
fitness
club
company,
had
a
base
salary
entering
2024
of
$350,000
after
starting
at
$300,000
nearly
three
years
ago.
But
he
is
set
to
get
a
$15,000
raise
as
a
result
of
the
merger.

Northwall,
who
previously
was
chief
architect
at
the
social
networking
site
Parler,
had
an
annual
salary
of
$365,000,
and
as
of
March
26
held
20,000
shares
of
company
stock.

Murphy
said
the
men’s
salaries
do
not
appear
excessive,
and
that
it
makes
sense
to
pay
them
“relatively
low
salaries”
while
giving
them
stock
to
incentivize
them
to
keep
the
share
price
high
by
building
out
Trump
Media’s
business.

Kash
Patel,
a
member
of
Trump
Media’s
board
who
previously
served
in
various
posts
in
the
Trump
administration,
last
year
received
a
total
of
$130,000
from
the
company
pursuant
to
a
consulting
agreement
it
signed
with
his
firm,
Trishul
LLC,
in
June
2022,
the
filing
said.
Patel
holds
no
shares
in
the
company,
according
to
the
filing.

Dan
Scavino,
a
former
Trump
Media
director,
was
paid
$240,000
last
year
by
the
company
pursuant
to
a
consulting
agreement
with
a
company
owned
by
him,
Hudson
Digital,
according
to
the
filing,
which
says
that
agreement
began
in
August
2021.

The
filing
also
says
that
Scavino,
who
previously
served
as
director
of
social
media
in
the
Trump
White
House,
received
a
promissory
note
in
the
amount
of
$2.2
million
from
Trump
Media
when
the
company
was
still
privately
held.
The
filing
does
not
say
if
the
note
is
convertible
into
stock
for
Scavino,
or
why
it
was
issued
to
him.

Scavino
also
“will
receive
a
retention
bonus
in
the
amount
of
$600,000,
payable
in
a
lump
sum
within
30
days
after
the
Closing
Date”
of
the
merger,
the
filing
says.

In
addition
to
the
trio
of
Nunes,
Juhan
and
Northwall,
who
are
identified
as
so-called
named
executive
officers
in
the
filing,
Trump
Media
plans
to
give
retention
bonuses
totaling
$1.24
million
to
other
executives,
the
filing
said.

The
filing
does
not
identify
by
name
or
number
those
other
executives
who
will
receive
retention
bonuses,
nor
does
it
say
how
much
each
executive
would
receive.

However,
the
filing
does
identify
several
key
employees
who
hold
executive
positions
at
Trump
Media:
Sandro
De
Moraes,
the
chief
product
officer;
Vladimir
Novachki,
the
chief
technology
officer;
and
Scott
Glabe,
who
is
general
counsel.

Novachki
has
45,000
shares
of
company
stock,
while
Glabe
has
20,000
shares,
according
to
the
filing.

De
Moraes
has
just
45
shares,
which
she
purchased
on
the
open
market,
the
filing
says.

Trump
Media
board
member
Eric
Swider,
who
served
as
CEO
of
Digital
World
Acquisition
Corp.
until
last
month,
beneficially
owns
153,153
shares,
according
to
the
filing.

However,
a
footnote
in
the
filing
says
that
more
than
143,000
of
those
shares
were
issued
to
the
corporate
entity
Renatus
LLC.
Swider
is
the
managing
partner
of
Renatus,
which
is
why
he
may
be
deemed
to
share
voting
and
disposition
power
over
its
shares.
But
he
“expressly
disclaims
beneficial
ownership
of
the
shares
held
by
Renatus,”
the
footnote
says,
noting
that
Swider
also
owns
the
remaining
10,110
shares.

Besides
Trump,
the
biggest
shareholders
in
Trump
Media
are
two
corporate
entities.

ARC
Global
Investments
II
LLC
held
nearly
9.55
million
shares,
or
a
6.9%
stake,
as
of
the
10-K
filing
on
April
1.
United
Atlantic
Ventures
reported
owning
7.525
million
shares,
representing
a
5.5%
stake
in
the
business.

Both
entities
are
currently
being
sued
by
Trump
Media.

ARC
Global
was
DWAC’s
sponsor.
United
Atlantic
Ventures
is
a
partnership
of
Andy
Litinsky
and
Wes
Moss,
who
initially
pitched
Trump
the
idea
of
creating
Trump
Media
in
February
2021,
after
the
former
president
was
banned
from
Twitter
and
Facebook
following
the
deadly
Jan.
6
Capitol
riot.
Both
Litinsky
and
Moss
were
contestants
on
Trump’s
NBC
hit
reality
show
“The
Apprentice.”

On
Thursday,
Patrick
Orlando,
a
managing
member
of
ARC
Global,
reported
in
an
SEC
filing
that
the
entity
owned
13.3
million
shares
of
Trump
Media,
representing
a
9.8%
stake
in
the
company.

Orlando
is
the
former
CEO
and
chairman
of
the
board
of
DWAC.
He
and
his
lawyers
did
not
immediately
respond
to
questions
from
CNBC
about
the
increase
in
the
shares.
The
Trump
Media
spokeswoman
likewise
did
not
reply
to
questions
about
it.

CNBC
specifically
asked
if
ARC
Global’s
increased
shares
reflected
the
release
of
some
of
the
3.58
million
shares
from
Trump
Media
that
had
been
held
in
an
escrow
account
since
late
March
in
connection
with
a
lawsuit
ARC
Global
filed
against
DWAC.

The
suit,
filed
in
Delaware
Chancery
Court
three
weeks
before
the
merger,
alleges
that
ARC
Global
was
not
allocated
the
correct
number
of
shares
as
a
result
of
the
merger
between
DWAC
and
Trump
Media.

Trump’s
company
sued
ARC
Global
and
Orlando
in
Florida
state
court
and
accused
them
of
trying
to
“obtain
a
windfall
by
way
of
extortion”
by
threatening
to
block
or
delay
the
merger.

DWAC
proposed,
and
a
Delaware
Chancery
judge
agreed,
to
have
the
shell
company
place
the
3.58
million
shares
in
escrow
to
preclude
the
possibility
that
ARC
Global
would
be
harmed
when
the
merger
was
completed.

The
disputed
shares
were
to
be
held
pending
the
resolution
of
the
Chancery
case.

Trump
Media
and
United
Atlantic
Ventures
are
also
embroiled
in
dueling
lawsuits
over
UAV’s
stake
in
the
company.

UAV
claims
in
a
Delaware
Chancery
Court
suit
that
it
is
entitled
to
an
8.6%
stake
in Trump Media,
which
is
more
than
three
percentage
points
greater
than
it
has
now.

Trump
Media
in
a
Florida
state
court
lawsuit
against
UAV
and
its
founders,
Moss
and
Litinsky,
seeks
to
strip
them
of
their
shares
in
Trump
Media.
Orlando
is
also
named
as
a
defendant
in
that
suit
for
alleged
breach
of
fiduciary
duty.