Two weeks ago, Carl Icahn said he was just in the first inning of his fight for changes at Motorola. Now he is in the late innings.

The company and the activist investor have reached an agreement, and Icahn will drop his proxy challenge. Under the deal, William Hambrecht, co-founder of Hambrecht & Quist, and Keith Meister, a managing director of the Icahn investment funds, will be nominated to the board of Motorola.

In addition, all litigation between the company and Icahn will be withdrawn.

"This is a very positive step for Motorola in that shareholder representatives will have strong input into board decisions affecting the future of our company," Icahn said in a statement.

It is quite a turnabout for Icahn, who lost a battle for a board seat last year. Since then, he has continued to push for changes at the company and to buy up shares. He has urged a breakup of the company, and late last month, Motorola said it would split off its troubled cell-phone business.  

In the statement, Icahn expressed his support for the split. (The other company will encompass Motorola's fast-growing home and networks business, which sells television set-top boxes and modems, and its enterprise mobility solutions, which sells computing and communications equipment to businesses.)

The activism has yet to pay off in his investment, however. Icahn, who currently holds a 6.4 percent stake in Motorola, started buying shares when they were $19. They are now at $9.67.