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Trump Media Announces $69.4 Million in Initial Proceeds from Warrant Exercise

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Trump Media & Technology Group (NASDAQ: DJT) announced it expects to receive over $69.4 million from the exercise of warrants on June 20 and 21, 2024. This follows the SEC's effective declaration of the company's registration statement on June 18, 2024.

If all warrants under this registration are exercised for cash, TMTG could garner up to $247 million. Furthermore, $40 million in restricted cash will be freed up, adding to the $200 million in unrestricted cash already held as of June 18, 2024. Investors should contact their brokers for warrant exercise.

Positive
  • TMTG expects to receive over $69.4 million from warrant exercises.
  • $40 million in restricted cash will become unrestricted.
  • Potential to receive up to $247 million if all warrants are exercised.
  • Currently holds over $200 million in unrestricted cash.
Negative
  • None.

The announcement that Trump Media & Technology Group Corp. (TMTG) is set to receive $69.4 million from the exercise of warrants is notably significant. Warrants are financial instruments that allow investors to purchase company stock at a predetermined price before a certain date. The successful conversion of warrants into cash indicates strong investor confidence in TMTG's future prospects.

From a financial health perspective, this infusion of nearly $70 million, with the potential for up to $247 million, boosts the company’s liquidity, providing substantial capital to further its operations or fund new initiatives. This is coupled with the unrestricting of $40 million and an existing unrestricted cash reserve of over $200 million, making TMTG's financial position considerably robust.

Short-term implications: The immediate capital inflow enhances TMTG's ability to invest in growth opportunities or manage short-term liabilities without needing to secure debt financing, which could be favorable for stock prices in the near term.

Long-term implications: The potential for additional warrant exercises (up to $247 million) suggests strong long-term investor belief in TMTG's business model and growth trajectory. However, the dilution effect of new share issuance must be considered, as it could impact existing shareholders' value. Investors should weigh this against the enhanced capital pool and potential for business expansion.

Warrant exercises reflect market confidence and bolster financial health, but they also entail shareholder dilution. Careful consideration of these dynamics is important for informed investment decisions.

The exercise of warrants and subsequent influx of $69.4 million into TMTG is a positive market signal. Warrants are a way to incentivize investors by providing them with a means to benefit from the company's potential upside. The fact that enough investors exercised their warrants shows significant market confidence in TMTG’s strategic direction.

From a market perspective, the ability to raise such a substantial amount through warrant exercises without resorting to conventional financing methods like loans or bond issues is noteworthy. It implies that TMTG has succeeded in building a strong investor base that is willing to bet on its competitive edge and future performance.

Market implications: The additional funds increase the company's financial flexibility, allowing it to enhance its platform, expand market reach, or even engage in strategic acquisitions. This can translate into improved market share and competitive positioning. Moreover, unrestricted cash, now totaling over $200 million, provides TMTG with a significant cushion to weather any market volatility or unexpected expenses.

Investors should monitor how TMTG plans to utilize this capital influx. Effective and strategic deployment of these funds could create substantial value and justify the market’s confidence reflected by the warrant exercises.

SARASOTA, Fla., June 21, 2024 (GLOBE NEWSWIRE) -- Trump Media & Technology Group Corp. (NASDAQ: DJT) (“TMTG” or the “Company”)—operator of the Truth Social platform, yet another of President Donald J. Trump’s iconic American brands—today announced that it expects to receive more than $69.4 million in proceeds from the cash exercise of warrants on June 20 and 21, 2024.

Such cash exercise became available after the Securities and Exchange Commission (“SEC”) declared effective the Company’s registration statement on Form S-1 on June 18, 2024 (“Registration Statement,” File No. 333-278678).

If all warrants covered by the Registration Statement are exercised for cash, TMTG may receive up to an aggregate of approximately $247 million in proceeds. Additionally, $40 million of restricted cash on the Company’s balance sheet will become unrestricted as a result of the Registration Statement becoming effective. These funds are in addition to the more than $200 million in unrestricted cash held by the Company as of June 18, 2024.

Investors interested in exercising their warrants should contact their registered broker.

About TMTG

The mission of Trump Media & Technology Group (TMTG) is to end Big Tech's assault on free speech by opening up the Internet and giving people their voices back. TMTG operates Truth Social, a social media platform established as a safe harbor for free expression amid increasingly harsh censorship by Big Tech corporations.

Investor Relations Contact:
Shannon Devine (MZ Group | Partner - MZ North America)
Email: shannon.devine@mzgroup.us

Media Contact:
press@tmtgcorp.com

About the Registration Statement

The offering of the securities covered by the Registration Statement may only be made by means of a prospectus. The Registration Statement and prospectus may be accessed through the U.S. Securities and Exchange Commission's website at www.sec.gov. A copy of the prospectus related to the offering may be obtained from Broadridge Financial Solutions, 1155 Long Island Avenue, Edgewood, NY 11717, or by telephone at (800) 353-0103.

The listing of an individual as a “selling securityholder” in the Registration Statement does not mean such individual or entity will sell their shares or is planning to sell their shares. Notwithstanding registration of securities on the Registration Statement, TMTG’s directors and officers, its affiliate President Donald J. Trump, and certain other securityholders will remain subject to a lockup period or otherwise restricted from selling any shares at this time.

Non-Solicitation

This press release shall not constitute an offer to sell or the solicitation of any offer to buy, nor shall there be any sale of these securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.


FAQ

How much money does Trump Media expect from the warrant exercise?

Trump Media expects to receive over $69.4 million from the warrant exercise on June 20 and 21, 2024.

What is the potential maximum proceeds Trump Media can receive from the warrant exercise?

Trump Media could receive up to $247 million if all warrants are exercised for cash.

When did the SEC declare Trump Media's registration statement effective?

The SEC declared the registration statement effective on June 18, 2024.

How much restricted cash will become unrestricted for Trump Media?

$40 million in restricted cash will become unrestricted.

How much unrestricted cash does Trump Media currently hold?

Trump Media currently holds more than $200 million in unrestricted cash as of June 18, 2024.

Trump Media & Technology Group Corp.

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