Mark Zuckerberg Is Selling 41 Million Shares of Facebook

Facebook founder and CEO Mark Zuckerberg said today that he will sell 41.4 million of his Class A company shares, netting roughly $2.3 billion. 

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Facebook founder and CEO Mark Zuckerberg said today that he will sell 41.4 million of his Class A company shares, netting roughly $2.3 billion. However, the huge "windfall" isn't just Zuck cashing out. Most of the money is going to Uncle Sam and to charity.

Reuters reports that Zuckerberg will use funds from the sale to pay a tax bill associated with the purchase of Class B shares. Each Class A share correlates to one vote, while each Class B share correlates to ten. When it's all said in done, the move will reduce his voting power from 58.8 to 56.1 percent.

According to TechCrunch, the sale is part of a larger company effort to raise an approximated $3.9 billion in a secondary offering. (They will also join the S&P 500 Index.) Zuckerberg's 41.4 million make up more than half of the 70 million Class A shares being offered. TechCrunch reports that Facebook's SEC filing also indicates Zuckerberg will gift 18 million shares of Class B stock, which will be converted to Class A shares, to the Silicon Valley Community Foundation in support of his education charities. At current stock prices, that's about $990 million in charitable giving.

Speaking of Facebook stock: Yesterday, District Judge Robert Sweet announced that Zuckerberg, along with a COO Sheryl Sandberg, Goldman Sachs, Morgan Stanley, JPMorgan and others, will face a lawsuit over the company's controversial May 2012 IPO. The complainants, who lost money after buying arguably overpriced shares during the offering, contend that Facebook should have disclosed more information about company decisions that would affect future revenue prior to the sale. The judge added that complainants could bring a suit against NASDAQ for hiding technical difficulties that made trades difficult (or impossible) to process during the botched IPO. Nasdaq was slapped with a $10 million fine over the debacle in May. 

According to Sweet, Facebook misled investors by implying that future revenues could be cut due to increasing mobile use and product decisions, when those cuts had in fact "already materialized." Investors bringing the suit include pension funds in Arkansas, California and North Carolina.

Zuckerberg's filing also follows outgoing Fed Chairman Ben Bernanke's announcement yesterday that the Fed will start to taper the economic stimulus program, a move that restored investor confidence and prompted the markets to close at record highs.

This article is from the archive of our partner The Wire.