Facebook Inc's board has proposed removing Mark Zuckerberg's majority voting control in the event of the social media giant's chief executive and founder deciding to exit management at some point in future.
In a proxy filing on Thursday with the U.S. Securities and Exchange Commission, Facebook's board said it will ask shareholders to vote on a proposal that would convert Zuckerberg's Class B shares into Class A shares if he is no longer in a leadership position.
As of June 2, Zuckerberg beneficially owned about 4 million Class A shares and about 419 million Class B shares, collectively representing about 53.8 percent of total outstanding voting power and 14.8 percent of total outstanding economic interests.
The proposed move - to be voted on at Facebook's annual general meeting on June 20 - is designed to make sure a future Facebook chief's management powers aren't limited, the board said.
"These new terms thus ensure that we will not remain a founder-controlled company after we cease to be a founder-led company," the board said in the filing. (bit.ly/1Y5tYkP)
Under current provisions, Zuckerberg is allowed to hold Class B shares and exercise majority voting control even if leaves the company. Zuckerberg would also be allowed to pass his Class B shares, and possibly his majority voting control, to descendants after his death.
(Reporting by Arathy S Nair in Bengaluru; Editing by Kenneth Maxwell)