When Facebook changed its stock structure earlier this year, the legal filings contained one very interesting clause. A line in the SEC filing, first spotted by Forbes, allowed Zuckerberg to retain control of the company without remaining as CEO, provided he left the company for public office. In a filing full of legal jargon, it raised eyebrows: was Zuckerberg getting ready to run for president?
The broad strokes of the agreement were simple enough: Zuckerberg wanted to sell massive quantities of Facebook stock to fund the Chan-Zuckerberg Initiative, but he didn’t want to lose any of his voting power as Facebook’s primary shareholder. As long as Zuckerberg stayed on as Facebook CEO, investors were happy to oblige, but a new lawsuit shows some board members were deeply rattled by the public-service clause.
“Erskine is just massively uncomfortable”
A Bloomberg report breaks out the internal drama based on court documents. Apparently, Facebook board member Erskine Bowles was particularly adamant about removing the public-service clause, arguing that it could allow Zuckerberg to effectively abandon his duties as CEO while retaining legal control of the company. Coordinating with Zuckerberg, Mark Andreessen ultimately overcame Bowles’ objections.
“Erskine is just massively uncomfortable with you getting to low economic ownership and then going off on leave with no involvement by the board and retaining control,” Andreessen wrote to Zuckerberg, according to the report. "We rediscuss it on every call.”
The lawsuit’s plaintiffs allege that Andreessen’s communications with Zuckerberg violated his duties as a board member. The company disputes that claim, saying, “Facebook is confident that the special committee engaged in a thorough and fair process to negotiate a proposal in the best interests of Facebook and its shareholders.”
Ethical concerns aside, the incident shows a surprising interest from Zuckerberg in eventually holding some kind of government position. When the first reports arrived in April, it wasn’t entirely clear whether the language had come from or what it meant to the Facebook CEO. But the new documents make it clear that Zuckerberg was personally aware of the carveout for public service and willing to fight his board to keep the clause intact. That doesn’t mean Zuckerberg will be running for office any time soon — but he’s definitely keeping his options open.
Update 3:15PM ET: Updated with statement from Facebook.