Arsenal are chasing the signature of Cabaye before the close of the transfer window and have already seen one bid rejected for the midfielder.
Arsene Wenger is keen to lure Cabaye to the Emirates and is expected to come back with a new improved bid for the French international.
Cabaye has missed Newcastle's opening two Premier League against Manchester City and West Ham in the wake of Arsenal's failed first bid for his services.
Newcastle boss Alan Pardew has called for the issue to be resolved one way or another and Kinnear admits Arsenal know what Newcastle want for Cabaye.
"We've told Arsenal our terms," Kinnear told the Daily Mirror. "The ball is in their court."
Kinnear has has also urged Newcastle fans to stay positive and insists he and Pardew have a strong working relationship.
"We are working together - not plotting against each other. I don't understand where the negativity has come from - we are two games into a 38-game season and already the doom-and-gloom merchants are looking for a scapegoat."
Fans have also grown upset at a perceived lack of action in the transfer market.
They unfurled a banner during the draw with West Ham which read 'Joe Kinnear, the clown of the Premier League', but the 66-year-old is standing his ground.
"Alan Pardew has signed 16 players costing £60m in the last two years, Newcastle United's wage bill is now comfortably in the top 10 in the country, and he will continue to get all the support the club can reasonably provide," Kinnear added.
"Before the season started, we had sat down and agreed the squad was big enough, and strong enough, to finish in the top half of the table. But we are working together - not plotting against each other.
"There seems to be a perception, from outside the club, that we are at loggerheads, but I don't know why people are jumping on the bandwagon because it is a false picture."