Meta agrees to give Mark Zuckerberg non-voting shares to keep him in California amid wealth-tax proposal

Meta Platforms announced a deal that will provide CEO Mark Zuckerberg with non-voting Class C shares that can be sold to cover a potential tax liability if California voters approve Proposition 40, a one-time 5% wealth tax on billionaires. In return, Zuckerberg has agreed to remain a resident of California, or wherever Meta keeps its headquarters, for the next eight years.

Under the arrangement, Zuckerberg can immediately sell 20% of the new shares, representing about 10% of his overall economic interest in the company, without affecting his voting control. The company plans to issue the new class of non-voting shares in January 2027, creating a two-for-one split intended to fund acquisitions and retain key talent.

"It is critically important that Mr. Zuckerberg remain in a leadership role and continue to manage the company from its California headquarters," a special committee of Meta's board said, citing the need for stability during what it described as an unprecedented challenge and competition in the industry driven by AI.

Analysts note that Proposition 40 is not certain to pass, though the measure would target the state's roughly 250 billionaires, whose combined wealth exceeds $2 trillion. Meta’s long-term forecasts indicate it will need to raise "hundreds of billions of dollars" beginning as early as fall 2026 to finance its AI-related growth plan.