Meta Platforms will let Mark Zuckerberg sell new non-voting shares to cover a possible 5% wealth tax bill in exchange for an eight-year pledge to remain in California. Key Points: Meta's new
Meta Platforms will let Mark Zuckerberg sell new non-voting shares to cover a possible 5% wealth tax bill in exchange for an eight-year pledge to remain in California.
Key Points:
- Meta's new Class C stock lets Zuckerberg sell part of his stake without giving up voting control.
- He agreed to live in California, or wherever Meta is based, for the next eight years.
- California voters decide on Proposition 40, a one-time 5% tax on billionaires, on Nov. 3.
Meta disclosed the arrangement Wednesday in a securities filing released alongside its quarterly earnings. The company will create non-voting Class C stock and give shareholders one new share for each Class A or Class B share they own. The new class, which Meta plans to use for raising capital, paying staff and buying companies, takes effect Jan. 19, 2027.
Zuckerberg, who is worth about $240 billion, can immediately sell 20% of the Class C shares he receives, a slice equal to roughly 10% of his overall economic stake. The other 80% can be sold only alongside his voting stock, though 2.5% gets released each quarter while he stays in a leadership role.
In return, Zuckerberg committed to living in California, or wherever Meta keeps its headquarters, for eight years unless unforeseen circumstances make a move elsewhere prudent.
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Zuckerberg told a special board committee he was weighing a move because the tax could bring a multibillion-dollar bill tied to his Meta stock. In a July conversation with lead independent director Robert Kimmitt, he warned that selling voting shares to pay it could shrink his control to about 53%. The committee called his presence at headquarters "critically important" as artificial intelligence reshapes the industry, and it wanted him working close to Meta Superintelligence Labs.
He held roughly 60.6% of Meta's voting power on Oct. 1.
Political analysts say Proposition 40, which would send 90% of its proceeds to health care, is far from certain to pass. Nvidia CEO Jensen Huangsaid Sunday he isn't afraid of an $8 billion tax bill.
The deal follows months of questions about where Zuckerberg would settle. He and his wife, Priscilla Chan, were reported earlier this year to be buying a waterfront mansion on Miami's Indian Creek island, and a neighbor said they planned to move in by April. Google co-founders Sergey Brin and Larry Page and investor Peter Thiel have already moved away.
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