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Tesla to ask shareholders to reinstate $55 billion pay package for Musk

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AUSTIN, Texas — Tesla will ask shareholders to reinstate a compensation package for CEO Elon Musk potentially worth $55 billion that was rejected by a judge in Delaware this year and to move the electric car maker’s corporate home from Delaware to Texas.

In a filing with federal regulators early Wednesday, the company said it would ask shareholders to vote on both issues during its annual meeting in June.

In January, Chancellor Kathaleen St. Jude McCormick ruled that Musk is not entitled to a landmark compensation package awarded by Tesla’s board of directors.

Five years ago, a Tesla shareholder lawsuit alleged that the pay package should be voided because it was dictated by Musk and was the product of sham negotiations with directors who were not independent of him.

It may be a tough sell for Tesla and Musk in June. Shares of Tesla Inc. have tumbled nearly 40% this year as global demand for electric vehicles fades and Tesla sales have fallen rapidly.

Musk said a month after the judge’s ruling that he would try to move Tesla’s corporate listing to Texas, where he has already moved company headquarters.

Almost immediately after the judge’s ruling, Musk did exactly that with Neuralink, his brain implant company, moving its corporate home from Delaware to Nevada.

In a letter to shareholders this week, Chairperson Robyn Denholm said that Musk has delivered on the growth it was looking for at the automaker, with Tesla meeting all of the 2018 CEO pay package targets.

“Because the Delaware Court second-guessed your decision, Elon has not been paid for any of his work for Tesla for the past six years that has helped to generate significant growth and stockholder value,” Denholm wrote. “That strikes us — and the many stockholders from whom we already have heard — as fundamentally unfair, and inconsistent with the will of the stockholders who voted for it.”

Tesla made and delivered more than 1.8 million electric vehicles worldwide in 2023, according to a regulatory filing. But its shares have lost about one-third of their value so far this year as sales of electric vehicles soften.

Yet Tesla sales are now falling sharply and it may be a challenge to get shareholders to back a fatter pay package in an environment where competition has increased worldwide and demand for electric vehicle sales is fading. Massive price cuts at Tesla have failed to draw more buyers. The company said it delivered 386,810 vehicles from January through March, nearly 9% fewer than it delivered in the same period last year.

Since last year, Tesla has cut prices as much as $20,000 on some models. The price cuts caused used electric vehicle values to drop and clipped Tesla’s profit margins.

This week, Tesla said it was letting about 10% of its workers go, about 14,000 people.

Tesla will hold its annual shareholders meeting on June 13.

Russia begins withdrawing peacekeeping forces from Karabakh, now under full Azerbaijan control

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President Vladimir Putin’s spokesman on Wednesday said Russian forces are being withdrawn from Azerbaijan’s Karabakh region, where they have been stationed as peacekeepers since the end of a war in 2020

MOSCOW — President Vladimir Putin’s spokesman said Wednesday that Russian forces are being withdrawn from Azerbaijan’s Karabakh region, where they have been stationed as peacekeepers since the end of a war in 2020.

In a conference call with journalists, Dmitry Peskov confirmed reports of the withdrawal but did not give further details.

The Karabakh region had been under the control of ethnic Armenian forces backed by Armenia’s military since 1994. But Azerbaijan took control of sizeable parts of the region in a six-week war in 2020.

That war ended with a Russia-brokered ceasefire that called for placing about 2,000 peacekeeping troops in the parts of Karabakh that were still held by Armenians. The forces’ duties were to include ensuring free passage on the sole road connecting Karabakh with Armenia.

But Azerbaijan began blocking the road in late 2022, alleging Armenians were using it for weapons shipments and to smuggle minerals, and the Russian forces did not intervene.

After months of increasingly dire food and medicine shortage in Karabakh due to the blockade, Azerbaijan launched a lighting blitz in September 2023 that forced the Karabakh Armenian authorities to capitulate after one day in negotiations mediated by Russian forces.

Almost all of Karabakh’s 50,000 ethnic Armenian residents fled the region within days.

Tesla to ask shareholders to reinstate $55 billion pay package for Musk rejected by Delaware judge

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AUSTIN, Texas — Tesla will ask shareholders to reinstate a compensation package for CEO Elon Musk potentially worth $55 billion that was rejected by a judge in Delaware this year and to move the electric car maker’s corporate home from Delaware to Texas.

In a filing with federal regulators early Wednesday, the company said it would ask shareholders to vote on both issues during its annual meeting in June.

In January, Chancellor Kathaleen St. Jude McCormick ruled that Musk is not entitled to a landmark compensation package awarded by Tesla’s board of directors.

Five years ago, a Tesla shareholder lawsuit alleged that the pay package should be voided because it was dictated by Musk and was the product of sham negotiations with directors who were not independent of him.

It may be a tough sell for Tesla and Musk in June. Shares of Tesla Inc. have tumbled nearly 40% this year as global demand for electric vehicles fades and Tesla sales have fallen rapidly.

Musk said a month after the judge’s ruling that he would try to move Tesla’s corporate listing to Texas, where he has already moved company headquarters.

Almost immediately after the judge’s ruling, Musk did exactly that with Neuralink, his brain implant company, moving its corporate home from Delaware to Nevada.

In a letter to shareholders this week, Chairperson Robyn Denholm said that Musk has delivered on the growth it was looking for at the automaker, with Tesla meeting all of the 2018 CEO pay package targets.

“Because the Delaware Court second-guessed your decision, Elon has not been paid for any of his work for Tesla for the past six years that has helped to generate significant growth and stockholder value,” Denholm wrote. “That strikes us — and the many stockholders from whom we already have heard — as fundamentally unfair, and inconsistent with the will of the stockholders who voted for it.”

Tesla made and delivered more than 1.8 million electric vehicles worldwide in 2023, according to a regulatory filing. But its shares have lost about one-third of their value so far this year as sales of electric vehicles soften.

Yet Tesla sales are now falling sharply and it may be a challenge to get shareholders to back a fatter pay package in an environment where competition has increased worldwide and demand for electric vehicle sales is fading. Massive price cuts at Tesla have failed to draw more buyers. The company said it delivered 386,810 vehicles from January through March, nearly 9% fewer than it delivered in the same period last year.

Since last year, Tesla has cut prices as much as $20,000 on some models. The price cuts caused used electric vehicle values to drop and clipped Tesla’s profit margins.

This week, Tesla said it was letting about 10% of its workers go, about 14,000 people.

Tesla will hold its annual shareholders meeting on June 13.

Officer shot before returning fire and killing driver in Albany, New York, police chief says

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The police chief in Albany, New York, says an officer was “ambushed” by a driver who shot him the leg as he approached a vehicle following an attempted traffic stop and returned fire, killing the man

ALBANY, N.Y. — A police officer in Albany, New York, was “ambushed” by a driver following an attempted traffic stop early Wednesday and was shot in the leg before returning fire, killing the man, the city’s police chief said.

The officer was hospitalized at Albany Medical Center and was alert and conscious, Police Chief Eric Hawkins said at a news conference outside the hospital.

“We just experienced one of an officer’s worst nightmares, and that is being ambushed performing a routine part of their duties,” he said.

The officer had seen a speeding vehicle about 12:30 a.m. and there was a short pursuit, but the vehicle didn’t stop and he stopped following it, Hawkins said. A short time later, the officer saw the vehicle parked along a road.

The officer approached the vehicle, Hawkins said. He was about 5 feet (1.5 meters) away from it when the man, who was out of the car, “emerges and immediately fires shots at the officer and strikes the officer,” Hawkins said.

The officer immediately returned fire, Hawkins said. The names of the officer and the man were not released.

Hawkins said he looked at footage from the officer’s body-worn camera. “There’s no other way to describe this but an ambush,” he said. “This officer was doing exactly what he was supposed to be doing.”

Albany Mayor Kathy Sheehan said at the news conference that there are indications that the man “is somebody with a troubled history, not necessarily a criminal history.”

She said she was grateful that she was able to speak to the officer.

“This was not what he expected to happen today during his shift,” she said.

Georgia’s parliament votes to approve so-called ‘Russian law’ targeting media in first reading

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TBILISI, Georgia — Georgia’s parliament has voted in the first reading to approve a proposed law that would require media and non-commercial organizations to register as being under foreign influence if they receive more than 20% of their funding from abroad.

Opponents say the proposal would obstruct Georgia’s long-sought prospects of joining the European Union. They denounce it as “the Russian law” because Moscow uses similar legislation to stigmatize independent news media and organizations seen as being at odds with the Kremlin.

“If it is adopted, it will bring Georgia in line with Russia, Kazakhstan and Belarus and those countries where human rights are trampled. It will destroy Georgia’s European path,” said Giorgi Rukhadze, founder of the Georgian Strategic Analysis Center.

Although Georgian President Salome Zourabichvili would veto the law if it is passed by parliament in the third reading, the ruling party can override the veto by collecting 76 votes. Then the parliament speaker can sign it into law.

The bill is nearly identical to a proposal that the governing party was pressured to withdraw last year after large street protests. Police in the capital, Tbilisi, used tear gas Tuesday to break up a large demonstration outside the parliament.

The only change in wording from the previous draft law says non-commercial organizations and news media that receive 20% or more of their funding from overseas would have to register as “pursuing the interests of a foreign power.” The previous draft law said “agents of foreign influence.”

Zaza Bibilashvili with the civil society group Chavchavadze Center called the vote on the law an “existential choice.”

He suggested it would create an Iron Curtain between Georgia and the EU, calling it a way to keep Georgia “in the Russian sphere of influence and away from Europe.”

Tesla will ask shareholders to reinstate Musk pay package rejected by Delaware judge

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FILE – A Tesla logo has rain drops on it Feb. 27, 2024, in Charlotte, N.C. After reporting dismal first-quarter sales, Tesla is planning to lay off about a tenth of its workforce as it tries to cut costs, multiple media outlets reported Monday. (AP Photo/Chris Carlson)

Georgia’s parliament votes to approve so-called ‘Russian law’ targeting media in first reading

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TBILISI, Georgia — Georgia’s parliament has voted in the first reading to approve a proposed law that would require media and non-commercial organizations to register as being under foreign influence if they receive more than 20% of their funding from abroad.

Opponents say the proposal would obstruct Georgia’s long-sought prospects of joining the European Union. They denounce it as “the Russian law” because Moscow uses similar legislation to stigmatize independent news media and organizations seen as being at odds with the Kremlin.

“If it is adopted, it will bring Georgia in line with Russia, Kazakhstan and Belarus and those countries where human rights are trampled. It will destroy Georgia’s European path,” said Giorgi Rukhadze, founder of the Georgian Strategic Analysis Center.

Although Georgian President Salome Zourabichvili would veto the law if it is passed by parliament in the third reading, the ruling party can override the veto by collecting 76 votes. Then the parliament speaker can sign it into law.

The bill is nearly identical to a proposal that the governing party was pressured to withdraw last year after large street protests. Police in the capital, Tbilisi, used tear gas Tuesday to break up a large demonstration outside the parliament.

The only change in wording from the previous draft law says non-commercial organizations and news media that receive 20% or more of their funding from overseas would have to register as “pursuing the interests of a foreign power.” The previous draft law said “agents of foreign influence.”

Zaza Bibilashvili with the civil society group Chavchavadze Center called the vote on the law an “existential choice.”

He suggested it would create an Iron Curtain between Georgia and the EU, calling it a way to keep Georgia “in the Russian sphere of influence and away from Europe.”

United Airlines slashes 2024 aircraft delivery plan as Boeing crisis leads to delays

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In this article

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  • UAL
A United Airlines Boeing 737 Max 9 aircraft lands at San Francisco International Airport.
Justin Sullivan | Getty Images

United Airlines on Tuesday cut its aircraft-delivery expectations for the year as it grapples with delays from Boeing, the latest airline to face growth challenges because of the plane-maker’s safety crisis.

United expects to receive just 61 new narrow-body planes this year, down from 101 it said it had expected at the beginning of the year and contracts for as many as 183 planes in 2024.

“We’ve adjusted our fleet plan to better reflect the reality of what the manufacturers are able to deliver,” CEO Scott Kirby said in an earnings release. “And, we’ll use those planes to capitalize on an opportunity that only United has: profitably grow our mid-continent hubs and expand our highly profitable international network from our best in the industry coastal hubs.”

United said it plans to lease 35 Airbus A321neos in 2026 and 2027, turning to Boeing’s rival for new planes as the U.S. manufacturer faces caps on its production and increased federal scrutiny. In January, United said it was taking Boeing’s not-yet-certified Max 10 out of its fleet plan. The airline said it has converted some Max 10 planes for Max 9s.

It lowered its annual capital expenditure estimate to $6.5 billion from about $9 billion.

United is also facing a Federal Aviation Administration safety review, which has prevented some of its planned growth. A spokeswoman told CNBC earlier this month that the carrier will have to postpone its planned service from Newark, New Jersey, to Faro, Portugal, and service between Tokyo and Cebu, Philippines.

United earlier this month postponed its investor day, which was scheduled for May, “because our entire team is focused on cooperating with the FAA to review our safety protocols and it would simply send the wrong message to our team to have an exciting investor day focused primarily on financial results.”

The airline said it would have reported a profit for the quarter if not for a $200 million hit from the temporary grounding of the Boeing 737 Max 9 in January.

The FAA temporarily grounded those jets after a door plug blew out minutes into an Alaska Airlines flight, sparking a new safety crisis for Boeing and slowing deliveries of its planes to customers including United, Southwest and others.

The airline posted a net loss of $124 million, or a loss of 38 cents a share, in the first quarter compared with a $194 million loss, or 59 cents, a year earlier. Revenue rose nearly 10% in the first quarter compared with the year-earlier period to $12.54 billion, with capacity up more than 9% on the year.

Here’s what United reported in the first quarter compared with what Wall Street expected, based on average estimates compiled by LSEG:

  • Loss per share: 15 cents adjusted vs. a loss of 57 cents expected
  • Revenue: $12.54 billion vs. $12.45 billion expected

The airline expects to post earnings of between $3.75 and $4.25 in the second quarter, ahead of analysts’ estimates of about $3.76 a share. Airlines make the bulk of their profits in the second and third quarters, during peak travel season.

The carrier also reiterated its full-year earnings forecast of between $9 and $11 a share.

United’s shares were up more than 4% in after-hours trading on Tuesday.

United executives will hold a call with analysts at 10:30 a.m. ET on Wednesday.

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Risk of a global recession is minimal, IMF economist says — would take ‘a lot to derail’

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One of the International Monetary Fund’s top economists signals little risk of a global recession, despite the ongoing rumblings of geopolitical uncertainty.

The Washington DC-based institute this week nudged its global growth outlook slightly higher to 3.2% in 2024 and projects the same rate in 2025.

“When we do the risk assessment around that baseline, the chances that we would have something like a global recession is fairly minimal. At this point, it will take a lot to derail this economy. So there has been tremendous resilience in terms of growth prospects,” Pierre-Olivier Gourinchas, economic counsellor and director of the research department at the IMF, told CNBC’s Karen Tso on Tuesday at the group’s meeting in New York.

The “set of good news” includes strong economic performance by the U.S. and several emerging market economies, along with inflation falling faster than expected until recently despite weaker growth in Europe, Gourinchas said.

There is divergence within Europe, he added, with the IMF downgrading its growth forecasts for Germany, France and Italy, but taking them higher for Spain, Portugal, Belgium and the U.K.

Growth forecasts since fall last year have had to factor in increased geopolitical instability, with tensions in the Middle East looming over the oil market, while Israel’s war with Palestinian militant group Hamas in the Gaza Strip led to disruptions in shipping routes in the Red Sea, by way of maritime attacks from Yemeni Houthis. That has all combined with the ongoing Russia-Ukraine war, which had its biggest wider impact on energy prices in Europe in 2022.

Oil prices increasing significantly and persistently throughout 2024 and further disruption to shipments between Asia and Europe would fuel inflation in 2024, Gourinchas noted, which would then cause central banks to hold rates higher for longer and weigh on global growth.

By the IMF’s estimate, a consistent rise in oil prices of around 15% in 2024 would push up global inflation by around 0.7%, though the value of the commodity has so far proved relatively stable even through the recent spike in Israel-Iran tensions.

Despite the positivity of the latest forecast, Gita Gopinath, the IMF’s deputy managing director, told CNBC on Tuesday she assessed geopolitical risks as a “big concern.”

“We have somehow managed the situation so far, and we’re not seeing big spillovers from the Middle East. But that is not a given. And that’s one of the big risks that we do see, the implications that could have for oil prices could be substantial. If the conflict were to escalate, become much bigger conflict,” she said.

UN report points to yawning gap of inequality in sexual and reproductive health worldwide

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GENEVA — A new study says an African woman is roughly 130 times more likely to die from pregnancy and childbirth complications than a woman in Europe or North America, the U.N. population fund reported Wednesday as it decried widening inequality in sexual and reproductive health and rights worldwide.

UNFPA’s latest “ State of World Population ” report also estimates that nearly 500 maternal deaths occur in countries with humanitarian crises or conflicts, and shows that women of African descent in the Americas are more likely to die giving birth than white women.

“Sweeping global gains in sexual and reproductive health and rights over the last thirty years are marred by an ugly truth — millions of women and girls have not benefited because of who they are or where they were born,” the fund said in a statement.

UNFPA executive director Dr. Natalia Kanem said the unintended pregnancy rate has declined by nearly one-fifth since 1990 and the maternal death rate has dropped by more than one-third since 2000.

But “inequalities within our societies and health systems are widening, and we have not adequately prioritized reaching those furthest behind,” she said. Improvements in health care access have mostly benefited wealthier women and members of ethnic groups with better access to care, the fund said.

Kanem hailed some progress: More than 160 countries have passed laws against domestic violence, and “legislation against LGBTQIA+ sexuality” that was once widespread has been on the retreat. Now only one-third of countries have such laws.

While she credited “the world’s agreement” that led to such gains, Kanem also warned: “Human reproduction is being politicized. The rights of women, girls and gender diverse people are the subject of increasing pushback.”

“And yet, today, that progress is slowing. By many measures, it has stalled completely,” she said. “Annual reductions in maternal deaths have flatlined. Since 2016, the world made zero progress in saving women from preventable deaths in pregnancy and childbirth.”

“Health systems today are weak,” Kanem added. “They’re tainted by gender inequality, by racial discrimination and by misinformation.”

The fund called for new investment in sexual and reproductive health, as well as improvements in sexuality education, stopping gender-based violence, and “ending unmet need for contraception” — an issue that has driven a wedge in some countries.

Under the term of U.S. President Donald Trump, the United States halted funding for UNFPA largely over concerns about abortion — depriving the fund of tens of millions of dollars over four years.