Trump Was Designed To Continue To Maintain TRUTH Social Despite Getting Into Legal Problems

Donald Trump made an elaborate contract to keep TRUTH Social. (photo: doc. unsplash)

JAKARTA - Former US President Donald Trump will be able to retain ownership of his newly launched social media venture even if he chooses to run for US President again in the next election or is punished by prosecutors investigating his business dealings.

Trump said last week that TRUTH Social would be created through a new company formed by the merger of Trump Media and Technology Group (TMTG) and blank check company Digital World Acquisition Corp.

According to the proposed contract issued on Tuesday, October 26, Trump is referred to as the "principle of the company", although the exact size of his stake in the company was not disclosed.

However, the former president has the right to retain his stake in TMTG, even if the company faces a "material disruptive event" – the latest contract includes a clause designed to protect its shares.

“To maximize business continuity and minimize, mitigate, or eliminate the negative impact on the Company from a Material Disruptive Event, the ownership and position of the Company's Principals in the Company must be structured in such a way as to eliminate the need for restructuring. Ownership of change of position is a Material Disruptive Event that could occur", according to the filing.

Since Trump lost the last presidential election in 2020, he has repeatedly hinted that he might run for a third term in 2024.

Trump and his business interests have also been the subject of many investigations from US authorities. In June, Trump's company and its chief financial officer were indicted. It is the first charge to emerge from a more than two-year investigation by New York prosecutors into Trump and his business dealings.

In its latest filing, DWAC highlighted the risks associated with Trump's company. "The purchaser hereby acknowledges the controversial nature of the Company Principals and the family of the Company Principals", he said as quoted by Reuters.

As part of the earnings clause in the deal, TMTG shareholders will receive an additional 40 million shares, based on the price performance of DWAC's share, which on Tuesday closed down nearly 30% but is still trading well above SPAC's IPO price of $10 a year.

Earlier in October, Reuters reported that the merger with TMTG had provided a potential windfall of $420 million for DWAC lead Patrick Orlando, who has been trying for a decade to reinvent himself as a serial dealmaker.