Apply redact function is greyed out, can't complete my redact request

It is not appropriate for Adobe or any user in this thread to decide what is appropriate for other users when dealing with signed documents and redacting information. There are many perfectly valid reasons why someone would want to redact an electronically signed PDF. The question here is not whether one should or should not redact a signed PDF, it's about HOW to redact a signed document; there are a lot of responses that are answering different questions and not the one that was actually asked.

My use case:

I had to provide a contract from a previous engagement as part of a background check. The background checkers did not need to know my salary, just that I had worked at that place. The original contract came as a PDF from Docusign. I did not need to provide the electronic signature in the original PDF. I could not redact the salary info from that PDF because of this restriction. 

I know this won't fit everyone's needs, but it's the best I could come up with for a situation like mine.

What I did:

I'm on a Mac, so Windows users will need to do something different, which I've noted below:

1. I opened the original contract PDF and Saved As _ver_2.0 (so that I would not risk damaging the original).
2. I opened _ver_2.0 in Mac's Preview app (Windows users can find another PDF viewer app, not Acrobat, for this part; there are many free ones available that can do what I did in the next step).
3. In Preview, I clicked Print > PDF > Save as PDF and applied the name _ver_2.1.
4. I opened _ver_2.1 in Acrobat DC Pro, applied the redactions (the Apply button was active).
5. Acrobat DC Pro appended _redacted to the filename. The output looked great.
6. I sent the _ver_2.1_redacted.pdf to the background checkers.

It seems that the Mac Preview app did away with the e-signature stuff when generating the new PDF, so, if you're on Windows, be sure to test this to make sure that the Windows PDF app you choose can create a new PDF out of an existing one and that the signature stuff does not get saved into the new one.

Avoid this:

Don't save the original PDF as jpg or PNG; the output looks horrendous. My method preserves the original look.

To Adobe Product Managers and Developers:

Yes, it's true, there are cases where another party needs to verify the authenticity of the original document. But there are also use cases where the authenticity does not need to be proven, and there are cases where the authenticity must be preserved AND sensitive details need to be redacted.

The solution you designed is clumsy and inflexible. It only takes one use case into account and assumes that everyone is going to work that one way; that was a faulty assumption.

Instead, add these options:

1. The ability for users to strip out the signature if they no longer need it.
2. The ability for users to preserve the signature AND redact content; make sure that it saves as a different filename so the original is not overwritten. Show a warning to the user when doing this. Show a pop-up to the recipient when opening these kinds of files that the signature is still valid but certain content has been redacted for confidentiality, and contact the originator if there are questions about the redactions.

The name of the game is flexibility, adaptability, and ENABLING the user, not restricting users' choices and assuming that Adobe knows best.

I find myself in the exact same situation, having decided for once to stop printing, redacting and scanning contracts to the favor of actual modern tools. Redacting part of a signed document is an actual legal requirement in my case (and likely in the original post as well). It has nothing to do with its validity as a signed agreement, no court of law would ever accept to enforce a redacted document. You would however be found in breach of confidentiality for having sent a copy of your client's contract to, say, your insurer, without first obfuscating PII or any trade secret that may be contained. I find this whole thread quite unhelpfull as the request to redact a signed document is neither nefarious, illegal or unethical. 
There is no logic behind the argument of preventing redacting of a signed document. Preventing editing, changes, copy/past and whatever is of course a basic requirement, but redacting is none of those things and preventing it is actually a much higher risk than allowing it. At least in my 2 cents.

It turns out to be very easy. Drag a signed PDF from Acrobat Pro to JPEG or another image format: File > Export to > Image > JPEG. Then use Preview or a similar program to export it back to PDF, or in Acrobat Pro do: File > Create > Combine files into a single PDF.  Then the security features of signing are gone and you can use all the Redact tools.

Given the new legal rules on protecting PII (Personal Identifiable Information), the risk of identity theft and hacking, and the earlier issues of confidentiality on this thread, sometimes signed PDFs have to be redacted as a mandatory requirement of law or responsible protection of others' PII, and not for nefarious reasons.

please see comment of:  useru52822277     7-Jun-2018 11:57 AM

I understand what both parties are trying to say, but I’m the instances where you may release parts of a signed contract, but wish to keep information such as pricing confidential, there is cause to REDACT a signed document. While your PDF still contains editable fields, it cannot be redacted after signature. PRINT your document to ADOBE PDF (rather than a printer) so that it flattens the layers in the PDF, then you can use the redact feature on the “printed” copy.

The point about digital signatures is that any change, even an invisible one, is forbidden and/or detected. Redaction is not a special case.

Redaction is very definitely editing. It would be easy to change the meaning of a contract by deleting words!

This leasehold reverts to the owner after two hundred

years and one day.

Now redact the word hundred...

You can't keep it signed and redact. You have to destroy/remove the signature, if it will let you (generally won't).