With the vote, Palm's board is now authorized to conduct a reverse split of between 1-for-10 and 1-for-20 before April 1. If the company approves a 1-for-10 plan, for example, an investor holding 1,000 shares would trade them in for 100 shares. Conversely, the value of those shares would climb to $6.80 each from the current trading price of 68 cents.
Palm's shares have languished under $1 since August, a level that can result in being delisted from Nasdaq. Although a reverse split would boost its price well above that threshold, the results are often temporary.
Palm is preparing to spin off PalmSource, which will focus exclusively on developing and marketing the Palm operating system.
"Today's shareholder vote represents another step toward realizing one of our key annual objectives to enhance shareholder value--the creation of two, well-capitalized, profitable, high-growth companies," Eric Benhamou, Palm's chief executive, said in a statement. The vote occurred during the company's regular annual shareholder's meeting.
Other issues approved by shareholders Tuesday include the re-election of three directors: Benhamou, Jean-Jacques Damlamian, a group vice president for France Telecom, and David Nagel, chief executive of PalmSource.