GameStop Corp. (NYSE: GME) (“GameStop” or the “Company”) today
announced that it has commenced a private offer to certain eligible
noteholders described below to exchange any and all of its
outstanding $414,600,000 aggregate principal amount of 6.75% Senior
Notes due 2021 (CUSIP Nos 36467WAB5 and U36328AB5, ISINs
US36467WAB54 and USU36328AB58) (the “Existing Notes”) for newly
issued 10.00% Senior Secured Notes due 2023 (the “New Notes”), upon
the terms and conditions set forth in the Offering Memorandum and
Consent Solicitation Statement (the “Offering Memorandum”) dated
June 4, 2020 (the “Exchange Offer”).
The New Notes are being offered to provide the Company
additional financial flexibility by replacing and extending the
maturity of the Existing Notes validly tendered in the Exchange
Offer until 2023.
Eligible holders who validly tender and do not validly withdraw
their Existing Notes in the Exchange Offer prior to 5:00 p.m., New
York City time, on June 17, 2020 (the “Early Tender Date”) and that
are accepted for exchange will receive $1,000 in principal amount
of New Notes per $1,000 principal amount of Existing Notes. For any
Existing Notes validly tendered after the Early Tender Date but
before the Expiration Date (as defined below) and that are accepted
for exchange, eligible holders will receive $950 in principal
amount of New Notes per $1,000 principal amount of Existing Notes.
Eligible holders who validly tender and do not validly withdraw
their Existing Notes will also receive accrued and unpaid interest
in cash on their Existing Notes accepted for exchange to, but not
including, the settlement date for the Exchange Offer.
The New Notes will be guaranteed on the same basis as the
Existing Notes by each of the Company’s existing and future
domestic subsidiaries that guarantee certain of the Company’s
indebtedness or indebtedness of guarantors (the “Guarantors”),
including under the credit agreement governing the Company’s
asset-based revolving credit facility (the “ABL Facility”), and
will be secured by first-priority liens on most of the Company’s
and the Guarantors’ assets other than assets that secure our ABL
Facility as described in the Offering Memorandum (the “ABL Priority
Collateral”) and by second-priority liens on the ABL Priority
Collateral, in each case, subject to certain exceptions and
permitted liens. The New Notes will mature on March 15, 2023.
In conjunction with the Exchange Offer, GameStop is soliciting
consents (the “Consent Solicitation”) to eliminate substantially
all of the restrictive covenants, certain affirmative covenants and
certain events of default contained in the indenture governing the
Existing Notes. The Exchange Offer is conditioned upon the
consummation of the Consent Solicitation and certain other
conditions. Holders who tender their Existing Notes in the Exchange
Offer must also, and will be deemed to, deliver their consents with
respect to such Existing Notes pursuant to the Consent
Solicitation.
The Exchange Offer and Consent Solicitation will expire at 11:59
p.m., New York City time, on July 1, 2020 (as it may be extended,
the “Expiration Date”). Tendered Existing Notes may be validly
withdrawn at any time until the earlier of (i) 5:00 p.m., New York
City time, on June 17, 2020, and (ii) the receipt of consents in
the Consent Solicitation from holders of at least a majority in
aggregate principal amount of Existing Notes outstanding.
Available Documents and Other Details
Documents relating to the Exchange Offer and the Consent
Solicitation will only be distributed to noteholders who complete
and return an eligibility form confirming that they are either a
“qualified institutional buyer” under Rule 144A or a non-U.S.
person under Regulation S who is a “non-U.S. qualified offeree” (as
defined in the eligibility form) for purposes of applicable
securities laws. Non-U.S. persons may also be subject to additional
eligibility criteria. Only holders of Existing Notes who certify
that they satisfy one of the foregoing conditions are eligible to
participate in the Exchange Offer. Persons who are not eligible
holders may not receive and review the Offering Memorandum nor may
they participate in the Exchange Offer. Noteholders who desire to
complete an eligibility form should either visit the website for
this purpose at www.dfking.com/gamestop or request
instructions by sending an e-mail to gamestop@dfking.com or
calling D.F. King & Co., Inc., the information agent for the
Exchange Offer and Consent Solicitation, at 866-829-0135.
The complete terms and conditions of the Exchange Offer and
Consent Solicitation are set forth in the Offering Memorandum. This
press release is for informational purposes only and is neither an
offer to sell nor a solicitation of an offer to purchase the New
Notes nor a solicitation of any consents in the Consent
Solicitation. The Exchange Offer and Consent Solicitation are only
being made pursuant to, and this press release is qualified by
reference to, the Offering Memorandum. The Exchange Offer is not
being made to holders of Existing Notes in any jurisdiction in
which the making or acceptance thereof would not be in compliance
with the securities, blue sky or other laws of such
jurisdiction.
The New Notes will not be registered under the Securities Act of
1933, as amended (the “Securities Act”), or any other applicable
securities laws and, unless so registered, the New Notes may not be
offered, sold, pledged or otherwise transferred within the United
States or to or for the account of any U.S. person, except pursuant
to an exemption from the registration requirements thereof.
The Exchange and Information Agent for the Exchange Offer and
Consent Solicitation is D.F. King & Co., Inc. and can be
contacted by calling 866-829-0135 or emailing
gamestop@dfking.com.
Forward-Looking Statements
This press release contains forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of
1995. Such statements are based upon management’s current beliefs,
views, estimates and expectations, including as to the Company’s
industry, business strategy, goals and expectations concerning its
market position, future operations, margins, profitability, capital
expenditures, liquidity and capital resources and other financial
and operating information, including expectations as to future
operating profit improvement. Such statements include without
limitation those about the Company’s preliminary estimated
financial results, expectations and other statements that are not
historical facts. Forward-looking statements are subject to
significant risks and uncertainties and actual developments,
business decisions and results may differ materially from those
reflected or described in the forward-looking statements. The
following factors, among others, could cause actual results to
differ materially from those reflected or described in the
forward-looking statements: the results of the Exchange Offer,
macroeconomic pressures, including the effects of COVID-19 on
consumer spending; the impact of the COVID-19 pandemic on the
Company’s business and financial results; the economic, social and
political conditions or civil unrest in the U.S. and certain
international markets; the cyclicality of the video game industry;
the Company’s dependence on the timely delivery of new and
innovative products from its vendors; the impact of technological
advances in the video game industry and related changes in consumer
behavior on the Company’s sales; the Company’s ability to keep pace
with changing industry technology and consumer preferences; the
impact of international crises and trade restrictions and tariffs
on the delivery of the Company’s products; the Company’s ability to
obtain favorable terms from its suppliers; the international nature
of the Company’s business; the Company’s dependence on sales during
the holiday selling season; fluctuations in the Company’s results
of operations from quarter to quarter; the Company’s ability to
de-densify its global store base; the Company’s ability to renew or
enter into new leases on favorable terms; the competitive nature of
the Company’s industry; the Company’s ability to attract and retain
executive officers and key personnel; the adequacy of the Company’s
management information systems; the Company’s reliance on
centralized facilities for refurbishment of its pre-owned products;
the Company’s ability to react to trends in pop culture with regard
to its sales of collectibles and our dependence on licensed
products for a substantial portion of such sales; the Company’s
ability to maintain security of its customer, employee or company
information; potential harm to the Company’s reputation; the
Company’s ability to maintain effective control over financial
reporting; the Company’s vendors’ ability to provide marketing and
merchandise support at historical levels; restrictions on the
Company’s ability to purchase and sell pre-owned video games;
potential decrease in popularity of certain types of video games;
changes in the Company’s global tax rate; potential future
litigation and other legal proceedings; changes in accounting rules
and regulations; and the Company’s ability to comply with federal,
state, local and international law. Additional factors that could
cause our results to differ materially from those reflected or
described in the forward-looking statements can be found in
GameStop's Annual Report on Form 10-K for the fiscal year ended
February 1, 2020, the subsection entitled “Risks Related to Our
Business” of Item 1A of which has been amended and restated
in GameStop’s Current Report on Form 8-K filed on June 4, 2020 and
our other filings made from time to time with the SEC and available
at the SEC's Internet site at http://www.sec.gov or
http://investor.GameStop.com. Forward-looking statements contained
in this release speak only as of the date of this release. The
Company undertakes no obligation to publicly update any
forward-looking statement, whether as a result of new information,
future developments or otherwise, except as may be required by any
applicable securities laws.
Contact:
GameStop Corp. Investor Relations (817)
424-2001investorrelations@gamestop.com
About GameStop
GameStop Corp., a Fortune 500 company headquartered in
Grapevine, Texas, is the world’s largest video game retailer,
operates approximately 5,300 stores across 14 countries, and offers
the best selection of new and pre-owned video gaming consoles,
accessories and video game titles, in both physical and digital
formats. GameStop also offers fans a wide variety of POP! vinyl
figures, collectibles, board games and more. Through GameStop’s
unique buy-sell-trade program, gamers can trade in video game
consoles, games, and accessories, as well as consumer electronics
for cash or in-store credit. The company's consumer product network
also includes www.gamestop.com and Game Informer® magazine, the
world's leading print and digital video game publication. General
information about GameStop Corp. can be obtained at the Company’s
corporate website.
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