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Yahoo’s yawner: Not much to see at annual meeting

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There were a lot of empty chairs and raw feelings at Yahoo’s anti-climatic annual shareholder meeting today at a San Jose hotel. The purple tote bags and free pastries didn’t do much to soothe those who showed up.

In fact, some joked that Yahoo’s public relations staffers outnumbered shareholders and members of the media.

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To add insult to injury, free Wi-Fi at the hotel pointed browsers to the Google home page.

But in the end, the Yahoo board claimed victory. Investors overwhelmingly voted to re-elect the board of directors. Here are the numbers released by Yahoo shortly after the meeting:

Roy J. Bostock: 79.5% for, 20.5% withheld

Ronald W. Burkle: 81.2% for, 18.8% withheld

Eric Hippeau: 90.7% for, 9.3% withheld

Vyomesh Joshi: 92.9% for, 7.1% withheld

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Arthur H. Kern: 77.9% for, 22.1% withheld

Robert A. Kotick: 92.4% for, 7.6% withheld

Mary Agnes Wilderotter: 92.2% for, 7.8% withheld

Gary L. Wilson: 81.8% for, 18.2% withheld

Jerry Yang: 85.4% for, 14.6% withheld

Whether that was a true vote of confidence remains to be seen. Some investors seem to be voting with their feet and selling the stock, which has declined 15% this year and is down 33% from its peak ...

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... following Microsoft’s offer to buy the company.

With no proxy fight, the event was more Yawn-hoo than Yahoo. And that was by design. After six months of takeover fireworks, Yahoo wanted as few bombs bursting in air as possible. To that end, the company tried to limit shareholder questions to just 15 minutes. That didn’t work out so well as some investors asked lengthy questions. And when Chairman Roy Bostock tried to end the meeting, an investor in the back of the room demanded that Dick Neyhart, a retired stockbroker from Berkeley who had waited patiently at the microphone, be allowed to ask his question.

Throughout the meeting, Bostock assured shareholders that Yahoo’s board had ‘called the shots’ during failed negotiations with Microsoft, and he reiterated that the online software giant never made a ‘compelling’ offer. At his first annual meeting as chief executive, Jerry Yang made his pitch that Yahoo was poised for growth in the next three years. ‘We are still in the middle of a massive transformation,’ Yang told investors.

Chief Financial Officer Blake Jorgensen projected growing sales despite the economic slowdown and said Yahoo might repurchase shares and make acquisitions.

Yang has spent half of his year-long tenure as CEO fending off the unsolicited bid from Microsoft. Sunnyvale, Calif.-based Yahoo remains an Internet powerhouse and one of the world’s most popular Web destinations. But in recent years, it lapsed into complacency. Lumbering and listless, it produced a long string of disappointing quarterly results. Wall Street grew increasingly impatient as online advertising leader Google and more nimble competitors outmaneuvered Yahoo.

Yang, the company’s co-founder, was already on the hot seat to reverse Yahoo’s misfortunes before Microsoft pounced. When buyout talks collapsed, billionaire investor Carl Icahn stepped into the fray. Icahn, who owns 5% of Yahoo’s shares, had sought to oust Yang and the rest of the Yahoo board until last week when Yahoo reached a settlement with him.

As part of that settlement, Yahoo agreed to expand its board to 11 members after the annual meeting. Icahn will take a seat on the board as will two more new directors.

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One of those directors was to be former AOL chairman and CEO Jonathan Miller. But Time Warner announced today that it would invoke Miller’s non-compete agreement to prevent him from taking a seat on the board.

Yang may have sidestepped a showdown with Icahn, who was a no-show at the meeting. But he and other board members and executives had to face some tough questions. They were blasted over, among other things, the company’s practices in China and executive compensation.

Some of the 125 Yahoo shareholders in attendance applauded when activist shareholder Eric Jackson of Ironside Capital asked for Bostock to resign if investors withhold a large number of votes. Bostock said he would not. Jackson also accused the board of ‘overplaying’ its hand in the Microsoft negotiations.

Bostock and Yang underscored that the company had been looking out for shareholders.

‘The board and the management team have always said, ‘What is it that we can do best for our shareholders,’ ‘ Yang said.

Some shareholders spoke out in favor of the Yahoo board and management team. ‘My wife and I own 1,200 shares, and I like what I have heard,’ one said.

Bostock triggered another round of sparring with Microsoft when he said the software giant never made its $33 a share offer in writing and did not explore the regulatory implications of a merger.

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In a written statement, Microsoft replied, ‘Yahoo is attempting to rewrite history yet again with statements that are not supported by the facts.’

-- Jessica Guynn

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