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Motorola Board Won't Endorse Seat for Icahn

Motorola's board will not endorse a nomination of billionaire financier Carl Icahn to join the board, the company said in a document filed with regulators late on Friday.

The world's second-biggest mobile phone maker urged shareholders "not to sign any proxy card" they might receive from entities associated with Icahn in its proxy statement.

The company said it received a notice from Icahn entities of an intention to nominate the activist investor to its board at the annual meeting, scheduled for May 7. But Motorola said it does not know whether the entities will "in fact solicit proxies or nominate Mr. Icahn" at the meeting.

Icahn could not immediately be reached for comment.

He said in late January he would seek a seat on the board in order to convince the company to accelerate its share buyback program due to recent weakness in its share price and the fact that Motorola has $11.3 billion in cash on its books.

Motorola shares have fallen more than 27 percent since mid-October as investors have reacted to two disappointing quarterly reports, with its latest quarter badly missing targets.

In its proxy, Motorola asked shareholders to vote for its own slate of directors in the filing.

It also urged investors to vote against other shareholder proposals, including a request for Motorola to start recouping unearned incentive bonuses allocated to senior executives if it later found they did not meet performance targets.

Motorola said the board had decided not to raise Chief Executive Ed Zander's 2006 salary of $1.5 million this year, which does not include stock options.

The company also said Chief Financial Officer David Devonshire would not see a salary increase this year.

The company also proposed a vote to increase its authorized employee stock option repurchase limit by 50 million shares to 154.3 million shares as employees had already bought 94.7 million shares under its existing plan.

Motorola said the additional shares would be enough for purchases for about six and a half more years.