Tesla Awards Musk $30 Billion Stock Award

Tesla has approved a stock award worth approximately $30 billion to CEO Elon Musk, designed to incentivize the billionaire to maintain his focus on Tesla.

The company said in a regulatory filing on Monday (August 4) that the new agreement includes 96 million Tesla shares that will vest if Musk remains CEO for two years. The restricted stock options have an exercise price of $23.34, the same as in the previous compensation plan.

Tesla CEO Elon Musk

The move highlights Musk's continued control over the company even amidst declining electric vehicle sales and stock prices. The world's richest man has previously stated that he wants a larger stake as he repositions Tesla towards future directions like artificial intelligence and self-driving cars.

In a shareholder letter released on Monday (August 4), the board emphasized the importance of retaining Musk, calling the award the first step in "a goodwill payment." The letter also stated that the board is developing a longer-term CEO compensation strategy, which will be submitted for a vote at the annual shareholder meeting on November 6.

“We recognize that Elon’s commitment to business projects, interests, and other potential matters is extensive, including his leadership roles at xAI, SpaceX, Neuralink, X, and the Boring Company, as well as his other interests, but we believe this award will incentivize Elon to remain at Tesla,” the board wrote in the letter.

“Losing Elon would not only mean losing his talent, but also losing a leader who would be attractive to Tesla in attracting and retaining talent.”