Mark Zuckerberg has considered leaving California if the state passes a measure imposing a one-time 5% tax on billionaires. The Meta CEO had indicated he was weighing a departure from the state where the company is headquartered and had informed the board that he planned to list his Silicon Valley home for sale.
Zuckerberg feared that the proposed wealth tax would force a major share sale, which would threaten his voting control of the company. Simultaneously, Meta's board feared that the CEO's departure could disrupt the company's AI ambitions, leading the company to seek a way to keep him in the state.
To address these concerns, Meta has struck a deal with Zuckerberg to protect him from the threat of the billionaire tax and provide financial incentives for him to stay. The company remade its stock structure via a new share class designed to help him pay the tax if it is passed by voters.
A filing shows that this new structure could allow Meta to raise about $700 billion in equity capital without diluting Zuckerberg's majority control. This arrangement ensures the chief executive can foot a potential tax bill while maintaining his leadership position.