Apple Removes ‘Prop 2’ from Proxy Vote

Apple Removes ‘Prop 2’ from Proxy Vote

Following the decision by a U.S. Federal Judge to side with David Einhorn’s Greenlight Capital by handing down an injunction against a proposal vote scheduled for Apple’s upcoming shareholders meeting, the company has removed “Prop 2” from the docket.

1980 Apple Stock Certificate

AppleInsider:

Apple announced in a statement on Friday that it will be pulling Prop 2 from its annual meeting slated to take place on Feb. 27, reports AllThingsD. Einhorn sought to block a vote on the proposal as it contained an article which revokes the ability of Apple’s board members to issue preferred stock, instead putting that power into the hands of shareholders.

Apple’s statement read: “We are disappointed with the court’s ruling. Proposal #2 is part of our efforts to further enhance corporate governance and serve our shareholders’ best interests. Unfortunately, due to today’s decision, shareholders will not be able to vote on Proposal #2 at our annual meeting next week.”

Einhorn is pushing for Apple to issue something he refers to as “iPrefs,” perpetual preferred stock that will pay out a quarterly $0.50 dividend, or $2 per year. He believes Apple could enhance the program over time and eventually offer five iPrefs per share of common stock. That would double the current dividend rate.

Even though Apple has removed Prop 2 from the docket for Wednesday’s meeting, it is under no obligation to issue the iPrefs. No indication has been given by the iOS device manufacturer as to whether it will be giving into Einhorn’s demands.

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