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Apple shareholders back management, board at annual meeting

February 27, 2013|By Chris O'Brien
  • Apple shareholders wait in line before the start of the company's annual meeting at its Cupertino, Calif., headquarters.
Apple shareholders wait in line before the start of the company's… (Chris O'Brien / Los Angeles…)

CUPERTINO, Calif. -- There was little of the expected fireworks at Apple's annual meeting Wednesday as shareholders overwhelming reelected all board members and backed the company's position on several proposed changes to Apple's bylaws.

However, shareholders hoping for word of a rumored stock split, or news that Apple might increase its dividends or buy back more of its stock, were disappointed. Chief Executive Tim Cook said the company continues to discuss its growing cash balance, and that he shared investors' concern about a share price that has plunged more than 30% from last summer.

"I know that what must be on at least some of your minds is the share price," Cook said. "I don't like it. The board doesn't like it."

Apple's stock was down another $4.30 or .96% to $444.67 in midday trading. The stock is well off its September high of $702.10.

The proposals being considered Wednesday did not include a controversial ballot measure that was removed after a judge's ruling last week. David Einhorn of Greenlight Capital successfully sued to block Proposal No. 2 which would have, among other things, limited the board's ability to issue preferred stock without shareholder authorization. 

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Einhorn has been lobbying Apple for a year to issue such stock as a way to return to shareholders some of the $120 billion in cash the company has on hand.

Cook had previous labeled the lawsuit a "silly sideshow," and was asked by a shareholder at the meeting whether he still felt that way after losing the legal battle.

"I absolutely do," he said, adding that the judge's ruling didn't change his mind.

Two representatives of major shareholders who have been critical of Apple's governance practices in the past rose to speak in favor of Proposal No. 2, even though it was no longer on the ballot.

One of them, Anne Simpson, director of global governance for the California Public Employees Retirement Fund, or CalPERS, praised Apple's board for placing the measure on the ballot, saying it was a pro-shareholder reform.

"I think it's a matter of great regret for long-term shareholders that you have had to withdraw this proposal," she said.

Simpson said she had learned that before the measure had been blocked, 98% of shareholders had voted in favor of it. Simpson said it was unfair that a measure that would benefit shareholders and was overwhelming supported had been blocked by Greenlight Capital. 

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