Facebook boss 'likes' windfall

Facebook CEO Mark Zuckerberg reaped a gain of nearly $2.3bn last year when he exercised 60 million stock options just before the online social networking leader’s initial public offering (IPO).

The windfall detailed in regulatory documents filed yesterday saddled the 28-year-old with a massive tax bill.

He raised the money to pay it by selling 30.2 million Facebook shares for $38 apiece, or $1.1bn, in the IPO.

Facebook’s stock has not closed above $38 since the IPO was completed last May. The shares gained 71 cents yesterday to close at $26.85.

The 29% decline from Facebook’s IPO price has cost Mr Zuckerberg nearly $7bn on paper, based on the 609.5 million shares of company stock that he owned as of March 31, according to the documents. His current stake is still worth $16.4bn.

Mr Zuckerberg, who started Facebook in his Harvard University room in 2004, has indicated he has no immediate plans to sell more stock.

The exercise of his stock options and his subsequent sale of shares in the IPO had been previously disclosed.

The proxy statement filed to announce Facebook’s June 11 shareholder meeting is the first time that the magnitude of Mr Zuckerberg’s stock option gain had been quantified.

The statement also revealed that Mr Zuckerberg’s pay package last year rose 16% because of increased personal usage of jets chartered by the company as part of his security programme.

Mr Zuckerberg’s compensation last year totalled nearly $2m, up from $1.7m last year.

Of those amounts, $1.2m covered the costs of Mr Zuckerberg’s personal air travel last year, up from $692,679.

If not for the spike in travel costs, his pay would have declined by 17%. His salary and bonus totalled $769,306 last year, as against $928,833 in 2011.

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