Science & Technology · 6 Intermediate · October 23, 2026

Tech CEO Wins Stock Deal to Offset California Tax

Photo: The White House (Public domain) via Wikimedia Commons

Listen

Vocabulary

proposed /prəˈpoʊzd/ adjective

suggested as a plan or idea that has not yet been decided or approved

The proposed tax would affect about 225 billionaires living in California.

strategic /strəˈtɛdʒɪk/ adjective

carefully planned to achieve a long-term goal or advantage

Meta made a strategic decision to focus on AI rather than virtual worlds.

offset /ˈɔfˌsɛt/ verb

to balance or compensate for something negative by adding something positive

The extra stock will help offset Zuckerberg's potential tax costs.

upheaval /ʌpˈhɛvəl/ noun

a sudden, major, and often disruptive change or disturbance

The company experienced significant upheaval when it renamed itself from Facebook to Meta.

alignment /əˈlaɪnmənt/ noun

agreement or harmony between different parties or goals

The founder alignment agreement ensures that the CEO's interests match the company's direction.

residents /ˈrɛzɪdənts/ noun

people who live permanently or for a long time in a particular place

About 225 billionaire residents of California would be affected by the proposed wealth tax.

Article

California voters may soon decide on a new tax targeting billionaires in the state. The proposed one-time tax would charge 5% on residents whose wealth exceeds $1 billion. Meta's chief executive Mark Zuckerberg, whose fortune is estimated above $200 billion, announced he was considering leaving California to avoid this tax. The move worried Meta's board because such a public departure could harm the company's reputation and raise questions about leadership during a period of major technological change.

A Financial Agreement

Meta responded by negotiating what it calls a "Founder Alignment Agreement" with Zuckerberg. Under this deal, the company will provide him with additional shares of stock more frequently and allow him to sell them quarterly. These extra shares are designed to offset any wealth he might lose if the tax passes in November. The agreement lasts eight years as long as Zuckerberg remains a California resident, and it functions regardless of whether voters actually approve the tax.

Why Keeping Leaders Matters

Meta explained that keeping Zuckerberg in California is "critically important" given rapid changes in artificial intelligence and the global economy. The company has undergone significant upheaval in recent years, including mass layoffs and a shift away from building virtual platforms toward developing AI products. During the pandemic, when Zuckerberg worked mainly from Hawaii, the company faced scandals and struggled with strategic direction. By securing his continued presence in the state, Meta hopes to maintain stability and focused leadership.

Discussion Questions

Why do you think Meta's board was concerned about Zuckerberg leaving California publicly, even if he disagreed with the tax?
Do you believe that giving a CEO extra stock to stay in a location is fair to other company employees? Why or why not?
How might the company's experience during the pandemic, when Zuckerberg worked from Hawaii, have influenced this agreement?
What do you think would happen to a technology company if its leader suddenly moved away during a period of major strategic change?
In your opinion, should voters approve or reject the proposed billionaire wealth tax? What are the arguments on both sides?

Open the full interactive lesson with tap-to-hear on every word →

Ready to speak English with real confidence?

Work 1-on-1 with Digby R. Kerr.

Claim Your Free 30-Min Class