Motorola

Motorola has scheduled its annual meeting for May 5. There might be a lot of fireworks between now and then, because Carl Icahn, no less, wants four seats on their board -- one-third of the total.

Motorola has offered him two seats. Icahn isn't in the mood for compromise and has turned that down.

Aside from the vote on who sits where, the meeting will also include a resolution to recoup unearned management bonuses. This looks like a turn-the-heat-up tactic on Icahn's part. The proposed resolution asks the board to seek to "recoup all unearned incentive bonuses or other incentive payments to all senior
executives to the extent that their corresponding performance targets were later
reasonably determined to have not been achieved or resulted from error(s)."

Icahn has also brought a lawsuit for access to documents. Delaware law requires that a demand for inspection have a specific basis -- the investor making such a demand can't be on a fishing expedition. On the basis that this is exactly what Icahn is doing, Motorola will contest the matter.

The stock price, by the way, has fallen dramatically over the last five months, from above $19 to below $10.

That might lead one to suppose, "gee, they must have lots of dissatisfied investors on their hands, so maybe the ground is fertile for Icahn's challenge."

It ain't necessarily so, though. The investors who are the most disgruntled about Motorola's management are those who would have been most likely to sell already -- to sell out at some point between $19 and $10. So those who still had stock as of the record date earlier this month, almost by definition, are those who believe that the problems are short-term and have some faith in a turnaround.

A real shake-out price drop on this scale, in other words, might be good news for a would-be self-entrenching management.

Actually, I have no idea. I'll know when you folks do.