WILSONVILLE, OR -- The rancor over Mentor Graphics grows more heated still as its largest shareholder called for the heads of its board of directors.

Carl Icahn, whose $1.9 billion offer for the printed circuit board design software developer was rejected out of hand, issued a public letter calling its board's actions "cynical" and adding, "Perhaps we should have sought to replace all of you."

Icahn's latest complaint is over the board's decision to issue roughly $253 million in convertible notes, a move the activist investor claims could be "massively dilutive" to the stock value of current shareholders.

He accused the directors of failing to explain a "poisonous make-whole" provision, which, Icahn said, is a "blatant attempt to derail an acquisition proposal" and could cost the company dearly in terms of making its future shares less valuable than current ones. "It appears to us that you may have in effect just sold a significant number of shares at a price well below our $17 per share offer, which you told shareholders 'undervalues the company and its future prospects,' " Icahn wrote.

Icahn is locked in a bitter battle over Mentor, which he feels is  run by a uninvested and laissez-faire board. Icahn owns 14.7% of the company's stock, but is effectively stopped from buying more due to a poison pill Mentor enacted.

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