GameStop 2004 Annual Report Download - page 82

GAMESTOP CORP.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Ì (Continued)
$18.26 per share for aggregate consideration before expenses of $111,520. The repurchased shares were
immediately retired.
19. Shareholders' Equity
The holders of Class A common stock and Class B common stock generally have identical rights except
that holders of Class A common stock are entitled to one vote per share while holders of Class B common
stock are entitled to ten votes per share on all matters to be voted on by stockholders. Holders of Class A
common stock and Class B common stock will share in an equal amount per share in any dividend declared by
the board of directors, subject to any preferential rights of any outstanding preferred stock. In the event of our
liquidation, dissolution or winding up, all holders of common stock, regardless of class, are entitled to share
ratably in any assets available for distribution to holders of shares of common stock after payment in full of any
amounts required to be paid to holders of preferred stock.
On October 25, 2004, the Board of Directors of the Company declared a dividend of one right (a
""Right'') for each outstanding share of the Company's Class A common stock and Class B common stock
(together the ""Common Stock''). The distribution of the Rights was made on October 28, 2004 to
stockholders of record on that date. Each Right entitles the holder to purchase from the Company one one-
thousandth of a share of a new series of preferred stock, designated as Series A Junior Participating Preferred
Stock (the ""Series A Preferred Stock''), at a price of $100.00 per one one-thousandth of a share. The Rights
will be exercisable only if a person or group acquires 15% or more of the voting power of the Company's
outstanding Common Stock or announces a tender oÅer or exchange oÅer, the consummation of which would
result in such person or group owning 15% or more of the voting power of the Company's outstanding
Common Stock.
If a person or group acquires 15% or more of the voting power of the Company's outstanding Common
Stock, each Right will entitle a holder (other than such person or any member of such group) to purchase, at
the Right's then current exercise price, a number of shares of Common Stock having a market value of twice
the exercise price of the Right. In addition, if the Company is acquired in a merger or other business
combination transaction or 50% or more of its consolidated assets or earning power are sold at any time after
the Rights have become exercisable, each Right will entitle its holder to purchase, at the Right's then current
exercise price, a number of the acquiring company's common shares having a market value at that time of
twice the exercise price of the Right. Furthermore, at any time after a person or group acquires 15% or more of
the voting power of the outstanding Common Stock of the Company but prior to the acquisition of 50% of
such voting power, the Board of Directors may, at its option, exchange part or all of the Rights (other than
Rights held by the acquiring person or group) at an exchange rate of one one-thousandth of a share of
Series A Preferred Stock or one share of the Company's Common Stock for each Right.
The Company will be entitled to redeem the Rights at any time prior to the acquisition by a person or
group of 15% or more of the voting power of the outstanding Common Stock of the Company, at a price of
$.01 per Right. The Rights will expire on October 28, 2014.
The Company has 5,000 shares of $.001 par value preferred stock authorized for issuance, of which
500 shares have been designated by the Board of Directors as Series A Preferred Stock and reserved for
issuance upon exercise of the Rights. Each such share of Series A Preferred Stock will be nonredeemable and
junior to any other series of preferred stock the Company may issue (unless otherwise provided in the terms of
such stock) and will be entitled to a preferred dividend equal to the greater of $1.00 or one thousand times any
dividend declared on the Company's Common Stock. In the event of liquidation, the holders of Series A
Preferred Stock will receive a preferred liquidation payment of $1,000.00 per share, plus an amount equal to
accrued and unpaid dividends and distributions thereon. Each share of Series A Preferred Stock will have ten
thousand votes, voting together with the Company's Common Stock. However, in the event that dividends on
the Series A Preferred Stock shall be in arrears in an amount equal to six quarterly dividends thereon, holders
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