DraftKings Spent $700K on Private Jet Travel for CEO Robins in 2023
Posted on: February 16, 2024, 08:15h.
Last updated on: February 16, 2024, 11:15h.
DraftKings (NASDAQ: DKNG) spent $700K on private air travel last year for cofounder and CEO Jason Robins.
That detail was revealed in the company’s annual report, which was published Thursday in conjunction with the operator’s fourth-quarter earnings release. In the filing with the Securities and Exchange Commission (SEC), DraftKings noted that starting in 2022, it chartered, “without markup,” a private jet owned by the chief executive officer “for the business and personal travel of Mr. Robins and his family.”
The Company had no direct or indirect interest in such private plane. During 2023 and 2022, the Company incurred no expenses and $0.7 million of expense, respectively, for use of the aircraft under these chartering services,” according to the regulatory document.
On March 30, 2022, DraftKings entered into a lease contract with an entity controlled by Robins under which the plane was leased to the gaming company for $600K for one year. Pursuant to its terms, that lease expired and a new arrangement for the same amount was drawn up.
DraftKings Board Signed Off
The audit and compensation committees of DraftKings’ board of directors approved the air travel and plane lease arrangement, citing the overall security program the company provides to Robins and his family. Those committees believe the private jet travel “is more efficient and flexible and better ensures safety, confidentiality, and privacy.”
The private jet costs incurred by DraftKings last year are well below what the operator dealt with in 2022. Two years ago, the online sportsbook operator spent nearly $969K on security for Robins and his family, as well as $131,607 in reimbursements for “the purchase of game day tickets, special events, travel and accommodations for Mr. Robins’ family members during the week’s activities” incurred at the 2022 Super Bowl.
DraftKings’ 2023 annual report doesn’t detail total security expenditures for Robins and his family, nor does it mention Super Bowl-related expenses. But the chief executive officer was in Las Vegas last week, according to his X feed.
It should be noted that DraftKings’ corporate jet expenses are fairly tame when measured against members of the S&P 500. In terms of gaming industry spending on private planes, Las Vegas Sands (NYSE: LVS) was the leader in 2022 at $3.2 million, trailing only Facebook parent Meta Platforms (NASDAQ: META).
DraftKings’ Compensation Committee
The DraftKings compensation committee is led by venture capitalist Ryan Moore, with Jocelyn Moore and Steven Moore being the other members. That committee’s charter confirms the group’s duties include making and approving options grants and other issuance of DraftKings equity to Robins and other high-ranking executives.
Some of those executives, including Robins, are frequent sellers of DraftKings stock, though all that selling hasn’t prevented the shares from soaring 26.13% year to date, and 167.83% over the past 12 months.
There’s not much outsiders can do about insider selling or how DraftKings executives are compensated. In the SEC filing, the company explicitly notes Robins controls all of the operator’s Class B stock, shares of which are worth 10 votes. The Class A shares available to the investing public contain just one vote apiece.
“Mr. Robins may have interests that differ from yours and may vote in a way with which you disagree, and which may be adverse to your interests. This concentrated control may have the effect of delaying, preventing, or deterring a change in control of DraftKings, could deprive our stockholders of an opportunity to receive a premium for their capital stock as part of a sale of DraftKings, and might ultimately affect the market price of shares of our Class A common stock,” according to the annual report.
Source: casino.org
