NICE WORK IF YOU CAN GET IT! Meta has struck a new deal with chief executive Mark Zuckerberg to keep him from leaving California over a proposed state tax on billionaires, the BBC reported Thursday.
The ballot measure, up for a vote in November, would slap a one-time 5% tax on residents worth more than $1bn. For Zuckerberg, whose fortune is estimated at over $200bn, that likely means around $10bn in extra state taxes.
So what happened? Last month Zuckerberg told Meta’s board he was thinking of moving his primary residence out of the state, warning a move “would be public and inevitably noted and commented upon by company employees.” The board’s answer: a stock split that created an entirely new type of share, one for every existing shareholder. Zuckerberg gets more stock, more often, and can sell it quarterly. His control over Meta doesn’t change.
Meta calls it the “Founder Alignment Agreement.” A company filing says it came out of “robust” and “at several points, contentious” talks with a special committee. It runs for eight years as long as he stays a California resident, and appears to apply even if the tax fails.
Meanwhile Meta says it could spend up to $145bn on AI this year and posted negative cash flow for the first time since going public. Investors weren’t thrilled: shares fell more than 7% Thursday, wiping more than $100bn off its market value.
Featured image: AI-generated editorial illustration by Bugle Blast.
Sources: BBC News
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