Tesla said on Monday its board has approved a new compensation package for CEO Elon Musk worth about $29 billion in restricted stock, aimed at retaining him at the helm of the electric vehicle maker through at least 2030.
The award of 96 million restricted shares was approved by the board on Sunday, according to a regulatory filing. Musk must pay $23.34 per share upon vesting, matching the exercise price from his 2018 package that was struck down earlier this year.
A Delaware judge in January ordered Tesla to revoke Musk’s 2018 $56 billion pay plan, ruling he had influenced negotiations with non-independent directors. Musk has appealed the decision, and in April the company formed a special committee to reassess his pay.
“We believe this grant will now keep Musk as CEO of Tesla at least until 2030 and removes an overhang on the stock,” Wedbush Securities analyst Dan Ives wrote in a research note. He said the award would motivate Musk to lead the company through an “inflection point” as it transitions to an “AI-first” strategy.
The move comes as Tesla faces a 25% drop in share value this year, hit by investor concerns over Musk’s political ties to former U.S. President Donald Trump, intensifying competition from U.S. and Chinese automakers, and sliding profits. The company’s second-quarter net income fell to $409 million from $1.39 billion a year earlier.