Motorola Names Icahn Executive To Board

The cellphone maker Motorola and the billionaire investor Carl C. Icahn reached a compromise on Monday.

As part of the settlement, Motorola has agreed to immediately appoint Keith Meister, a managing director of Icahn investment funds, to its board.

In addition, Mr. Meister and William R. Hambrecht, the founder and chief executive of W.R. Hambrecht and Company, would be nominated for Motorola’s board at the annual meeting. Mr. Icahn is Motorola’s second-largest shareholder with a 6.4 percent stake.

Motorola, based in Schaumburg, Ill., will also seek input from Mr. Icahn on the planned separation of its mobile devices operations, and search for a chief executive for that business.

In return, Mr. Icahn has agreed not to solicit proxies at Motorola’s annual meeting, dismiss litigation against the company and vote his shares in support of all of the board’s director nominees.

Mr. Icahn had sued Motorola, demanding internal board documents that he believed would show that directors were lax in its oversight of management.

“We are pleased to have reached this agreement with Carl Icahn,” the chief executive, Gregory Q. Brown, said. “We look forward to continuing the process we announced on March 26 to create two independent publicly traded companies and we are pleased to avoid a costly and distracting proxy contest.”

In the statement, Mr. Icahn called the compromise a “a very positive step for Motorola in that shareholder representatives will have strong input into board decisions affecting the future of our company.”

“In addition, the Motorola board,” Mr. Icahn said, “has also taken an important step forward for corporate governance in that the separated company which includes mobile devices will be essentially free from poison pills and staggered boards, both of which, in my opinion, serve to make democracy a travesty in corporate America.”

In late March, after a two-month strategic review of its businesses, Motorola announced plans to split itself into two separate publicly traded companies, spinning off its unprofitable mobile phone unit to investors.

Mr. Icahn had been pressured Motorola to make such a move as a way to bolster the company’s lagging share price.

At the time, Mr. Brown had conceded that the main problem facing the company was its inability to come up with new products to replace the highly successful Razr, which was once a must-have phone but has faded from the scene.

He said he hoped that by turning the mobile devices business into its own unit, the company would have better luck attracting a new chief executive to run it and revive Motorola’s reputation.

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