updated 04:37 pm EST, Thu February 7, 2013
Says preferred stock not prevented by ballot measure
Apple has released a public statement in response to a new lawsuit by Greenlight Capital. "Contrary to Greenlight's statements, the adoption of Proposal #2 would not prevent the issuance of preferred stock," Apple writes. "Currently, Apple's articles of incorporation provide for the issuance of 'blank check' preferred stock by the Board of Directors without Shareholder approval." With Proposal 2 in effect, the company suggests, shareholders would have the right to approve an issuance of preferred stock.
Greenlight's position has been that Apple should give out a steady supply of preferred stock with a 4 percent yield. This afternoon's statement would appear to allow for the Greenlight plan; Apple moreover says that it has been having "active discussions" on returning more cash to shareholders, but without going into further specifics.
In a Bloomberg TV interview, Greenlight president David Einhorn says that he spoke with Apple yesterday. "The call I had with them yesterday was very friendly, a very good tone of voice. I had a nice conversation with [Apple CEO] Tim [Cook] on this topic. He said he wants to review this proposal, wants me to meet with him and their advisers."
The proposal in question is set to be voted on at Apple's annual shareholder meeting, scheduled for February 27th.