Tesla has granted long-term CEO Elon Musk an interim stock award of 96 million shares, valued at approximately $29 billion, in a new pay deal aimed at keeping the billionaire at the helm. Tesla says that Musk has delivered “extraordinary value” to shareholders but hasn’t been paid in years after the 2018 pay package was struck down by a Delaware court last year.

Musk will be able to claim the award if he continues to be the CEO of Tesla for another two years and the court reinstates the 2018 package. The Tesla CEO has to hold these shares for five years and can buy them at $23.34 per share, the same as the exercise price of the 2018 award.

The electric vehicle maker also stated that it would present a longer-term CEO compensation strategy for a vote at its November 6 annual meeting.

Why Tesla is paying $29 billion to Elon Musk

Tesla stated that the grant is a “first step, good faith” way of incentivising Musk to stay at Tesla and keep him focused on leadership roles even while he juggles his time between xAI, SpaceX, Neuralink and other interests.

“Rewarding Elon for what he has done and continues to do for Tesla is the right thing to do,” Tesla wrote in a letter to shareholders.

Meanwhile, the $29 billion package also quells any rumours of the Tesla board losing patience with Musk after the EV maker had a tough few months following Musk’s extended stay at Washington. It also gives Musk greater control of the company while showcasing that Tesla directors still look at him as the best suited person to lead the EV maker in the future.

“While we recognize Elon’s business ventures, interests and other potential demands on his time and attention are extensive and wide-ranging… we are confident this award will incentivize Elon to remain at Tesla,” the EV maker said.