On Thursday, electric car-maker Tesla Motors (NASDAQ:TSLA) announced plans to sell $500 million of additional shares in order to raise capital to fund its continuing expansion. The decision to raise capital isn't a surprise. The company has been burning through its cash at an alarming rate. But just as interesting as the stock offering itself was a key statement tucked in the announcement about one individual planning to buy shares in the offering.

"Elon Musk, Tesla's CEO, intends to purchase $20 million of common stock in this offering at the public offering price," the release stated.

Musk's decision to buy more shares supports his unyielding commitment to being a large shareholder of the company.

Elon Musk's Tesla stock

"I will be the last one to sell shares," Musk said in Germany in late 2013 when he was speaking about Tesla's plans in the region.

Musk's promise is worth giving some weight. Not only have very few CEOs ever made such a promise, but Musk's level of ownership in Tesla is quite outstanding. The CEO owns an estimated 27% of Tesla shares, making him the company's largest shareholder. This is a no-joke portion for a company worth more than $30 billion. So, promising to be the last to sell any shares of a position like this is quite a statement.

This isn't the first time Musk has invested in a Tesla stock offering. Musk purchased about $100 million worth of shares when the company raised about $450 million through a common stock offering more than two years ago.

Musk's large position in Tesla stock, and the CEOs decision to buy another $20 million worth of shares is good news for Tesla shareholders. There's really no way to put a negative spin on a heavily invested CEO.

Famed investor Warren Buffett strongly advocates insider ownership. The first two principles in the Berkshire Hathaway owner's manual read:

Although our form is corporate, our attitude is partnership. In line with Berkshire's owner-orientation, most of our directors have a major portion of their net worth invested in the company. We eat our own cooking.

The offering

The plan to sell $500 million worth of shares of common stock, which will take place in an underwritten registered public offering, also grants underwriters a 30-day option to purchase up to $75 million of additional shares of common stock.

What will the fresh capital be used for?

"Tesla intends to use the net proceeds from this offering to accelerate the growth of its business in the United States and internationally," the release states, "including the growth of its stores, service centers, Supercharger network, and the Tesla Energy business, and for the development and production of Model 3, the development of the Tesla Gigafactory, and other general corporate purposes."

This follows the company's arrangement earlier this year with five banks to open up a $500 million credit line, which has the option of being extended to $750 million. Tesla management said during its second-quarter earnings call it has only tapped into $50 million of this credit line.

Going forward, the company is hoping sales of the Model X will help Tesla become free cash flow positive. According to comments from management during Tesla's Q2 call, any decision to raise capital would reflect efforts to reduce risk, and wouldn't represent a move to keep the company from becoming insolvent.

Musk explained the company's thoughts on cash during the Q2 call:

I don't think that there's not a need to raise equity capital. There may be some value in doing so as a risk reduction measure, but to be clear, we -- what Deepak is saying is that even in the absence of any additional capital generation activity, we would have on the order of $1 billion through -- basically that would be, our minimum cash position.

While the share dilution caused by a $500 million offering is unfortunate, the company has historically proved to investors that management is more than capable of prudently investing capital in growth measures. Since the last Tesla stock offering, sales and gross profit have both more than doubled. Tesla's vehicle sales soared about 40%, year over year in 2014, and this growth rate has accelerated to about 50% in 2015.

The bonus here, of course, is that Musk is still putting his money where his mouth is. And he's doing so to a greater extent than the great majority of CEOs of publicly traded companies.