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Reuters/Reuters - Apple CEO Tim Cook speaks to the audience during an Apple
event in San Jose, California October 23, 2012. REUTERS/Robert Galbraith
CUPERTINO, California (Reuters) -

Apple Inc CEO Tim Cook on Wednesday

acknowledged widespread disappointment in the company's sagging

share

price but shared few details about its secretive product pipeline and

touched only briefly on a raging debate about how best to

rewardshareholders.
The world's most valuable technology company headed into its annual
shareholders' meeting at its headquarters on shakier ground than it has
been accustomed to in years, since the iPhone and iPad helped vault the
company to premier investment status.
A declining share price has lent weight to Wall Street's demand that it
share more of its $137 billion in cash and securities pile - equivalent
to Hungary's Gross Domestic Product, and growing - a debate now
spearheaded by outspoken hedge fund manager

David Einhorn.

Einhorn was not spotted at the meeting at the company's

headquarters

at

1 Infinite Loop in Cupertino. Cook repeated that the company's board

remained in "very very active" discussions about options for cash sharing,
and said he shared investors' dissatisfaction over the stock price.
"I don't like it either. The board doesn't like it. The management team
doesn't like it," Cook told investors.
"What we are focused on is the long term. This has always been a secret
of Apple."
By focusing on the long term, revenue and profit will follow, he said.
Apple had the "mother of all years" last year with growth, in terms of
dollars, outpacing that of Microsoft Corp, Google Inc, Nokia and several
other major technology companies combined, Cook said.
Cook -- who was re-elected to the board with 99.1 percent of shareholder
votes -- added that the company was working on new product categories,
but, as usual, would not elaborate.
Speculation is rife on Wall Street and in Silicon Valley that the iPhone
maker is working on a project to revolutionize the television and TV
content, or a smart "iWatch."
Apple's stock was down 0.25 percent to $447.86 in afternoon trade. It is
now down more than 35 percent from its $702.10 September peak.
SHARE AND SHARE ALIKE

Cook presided over Wednesday's staid affair in his typically even-keeled

manner. Despite a slipping share price, dissatisfaction on the Street over
its cash allocation and uncertainty over its product pipeline,
shareholders re-elected the entire board, and Cook won more than 99
percent of the vote in preliminary results.
Cook got the most votes, followed by Walt Disney Co's Bob Iger, who won
re-election with 99 percent of shareholder votes. Former Avon Products
Inc CEO Andrea Jung, who stepped down after botching several attempts at
restructuring the cosmetics company, received the fewest votes of the
group, with 84.6 percent of shareholders voting yea.
Carol Shoaff, an Apple shareholder for about the past five years, said
after the meeting that she was confident in Apple's leadership and the
company was on the right path.
"I think he's good," she said, referring to Cook. "I don't think Steve
Jobs would have left him in charge if he didn't believe in him."
Members of the Service Employees International Union protested outside
the headquarters to get Apple to reconsider hiring of securities
contractor SIS.
Apple's annual shareholder

meetings have seemed more like celebrations

in recent years. Since the company came out with its first iPhone in 2007,
the company multiplied in market value until it peaked in September.
Then Samsung Electronics and Amazon.com Inc began seriously eroding its
market share in 2012, powered by arch-rival Google Inc's Android software.
On March 14, Samsung will launch the Galaxy SIV smartphone, the latest
iteration of a flagship smartphone that helped it dethrone Apple from the
top of the industry.
Institutional investors want Apple to share a greater chunk of its cash
and securities pile, a demand growing increasingly strident with the
company's stock wallowing at levels untested since the start of 2012.
Einhorn is advocating "iPrefs," preferred stock that will carry a
perpetual 4 percent dividend to boost returns while not hampering cash
flow.

On Friday, Einhorn won an important legal victory that strengthened his

hand. His Greenlight Capital secured an injunction that invalidated
shareholder voting on a proposal to scrap Apple's power to issue preferred
stock at its discretion.
Apple says this would enhance governance. But the hedge fund manager
argued it could complicate efforts to issue preferred securities in the
future.
Cook said again on Wednesday that Einhorn's lawsuit - regardless of its
efficacy - was a "silly sideshow." The underlying principle of cash
distribution was something he and the board took seriously, he added.
The proposal was not put forth on Wednesday but

Apple shareholders

and

representatives from the California Public Employees Retirement System

and the Nathan Cummings Foundation spoke in favor of it at the meeting.
CalPers, owner of 2.7 million Apple shares, had supported the so-called
Proposal 2. Senior Portfolio Manager Anne Simpson

said it was

unfortunate the measure could not be put forward.

"We know there is hot debate going on with cash," Simpson told the
assembled shareholders. "We are willing and happy to wait."
NEW HQ TO BE DELAYED
Cook, who took over from late company co-founder Steve Jobs in 2011,
answered a variety of questions from shareholders, including some on
Apple's new headquarters, labor conditions in its factories and product
plans.
One shareholder also asked why there was no bathroom in an Apple retail
store in Santa Monica, Calif. Cook, acknowledging that it was an important
point, said he will look into it.
On the new headquarters, Cook said the company plans to break ground later
this year and occupy the facilities in 2016, a delay from the original
2015 target date.
The meeting largely followed the script with no distractions.
Shareholders voted down two shareholder proposals, both of which were

opposed by Apple's board. One wanted Apple leadership to hold more stock,
the other was a proposal to create a board committee on human rights.
(Writing by Edwin Chan; Editing by Lisa Von Ahn, Tim Dobbyn and Dan
Grebler)