GameStop can now pay dividends, they do not need to wait until April 30th!
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| Author       | Source       | 
| :-------------: |:-------------:|
| [u/Bladeace](https://www.reddit.com/user/Bladeace/) | [Reddit](https://www.reddit.com/r/Superstonk/comments/mqh3ep/gamestop_can_now_pay_dividends_they_do_not_need/) | 

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[DD 👨‍🔬](https://www.reddit.com/r/Superstonk/search?q=flair_name%3A%22DD%20%F0%9F%91%A8%E2%80%8D%F0%9F%94%AC%22&restrict_sr=1)

TL;DR: GameStop is allowed to pay dividends as soon as it deposits the funds for their note buyback - which it can do at any point after the filing of the redemption notice and before the redemption date. If they have already deposited the funds, they can declare a dividend.

I have been looking at the indenture filing related to the 2023 debts GameStop announced they are paying out on the 30th of this month. The indenture against dividends, share buybacks, mergers, ect ends as soon as GameStop deposits the funds with the US Bank National Association, which they can do any time before 11am April 30th.

In the [July 6 2020 indenture filing](https://www.sec.gov/Archives/edgar/data/1326380/000119312520187950/d28310dex41.htm?fbclid=IwAR1xG3hO5qLQuB9Zg-EX5tt8JJ8eq9Kt3hgWb7MMrRb8BQew6_36eRQ1A-g) for these 2023 notes sections 8.01 and 8.02 explain what is required to remove the restrictions placed on GameStop:

[![r/Superstonk - GameStop can now pay dividends, they do not need to wait until April 30th!](https://preview.redd.it/gi8sxcd0j1t61.png?width=1258&format=png&auto=webp&s=aad77a866dd74c04a404b7bff32160df174d4728)](https://preview.redd.it/gi8sxcd0j1t61.png?width=1258&format=png&auto=webp&s=aad77a866dd74c04a404b7bff32160df174d4728)

When GameStop meets the obligations in section 8.04, they are free from the indenture against rebuying shares and issuing dividends.

Section 8.04a reads as follows:

[![r/Superstonk - GameStop can now pay dividends, they do not need to wait until April 30th!](https://preview.redd.it/j3h4s5xoj1t61.png?width=1265&format=png&auto=webp&s=c522f2cce31628886e2c5cbdd983bd9a281c41db)](https://preview.redd.it/j3h4s5xoj1t61.png?width=1265&format=png&auto=webp&s=c522f2cce31628886e2c5cbdd983bd9a281c41db)

GameStop meets its requirements for section 8.02 once it has deposited money in trust to pay for the notes.

You'll notice that section 8.02 requires GameStop to deposit the funds into the trustee, who is named at the end of the document in section E3 as:

[![r/Superstonk - GameStop can now pay dividends, they do not need to wait until April 30th!](https://preview.redd.it/3th92cgdk1t61.png?width=599&format=png&auto=webp&s=1b79f4a3f8af22b410501d12720b29b3c280cc46)](https://preview.redd.it/3th92cgdk1t61.png?width=599&format=png&auto=webp&s=1b79f4a3f8af22b410501d12720b29b3c280cc46)

Once the money to pay the notes is in the U.S. Bank National Association's account, GameStop is free from the obligations.

Now, look at [GameStop's April 13th filing](https://news.gamestop.com/static-files/d8871fe4-2c5f-4566-9a43-4ba9d8504cef) where they announce the redemption date:

[![r/Superstonk - GameStop can now pay dividends, they do not need to wait until April 30th!](https://preview.redd.it/5db176gjm1t61.png?width=1129&format=png&auto=webp&s=72d16735e351bf6869a31ac77460e0e78fa1e4b5)](https://preview.redd.it/5db176gjm1t61.png?width=1129&format=png&auto=webp&s=72d16735e351bf6869a31ac77460e0e78fa1e4b5)

The redemption date is the 30th of April.

Notice that the redemption date *is not necessarily when GameStop will deposit the money to the US Bank National Association*. A redemption date is for the holder of the note, not the issuer of the note. Let's look back at the July 6 2020 indenture, where it says this about depositing funds with the trustee for the redemption date:

[![r/Superstonk - GameStop can now pay dividends, they do not need to wait until April 30th!](https://preview.redd.it/kjdmm2uzn1t61.png?width=1269&format=png&auto=webp&s=55945641243df219dd7859d3339b5a10504f5466)](https://preview.redd.it/kjdmm2uzn1t61.png?width=1269&format=png&auto=webp&s=55945641243df219dd7859d3339b5a10504f5466)

Now that the redemption date has been filed, GameStop can deposit the funds at any time!

Ok, now let's look back at GameStop's April 13th Filing with a difference point highlighted:

[![r/Superstonk - GameStop can now pay dividends, they do not need to wait until April 30th!](https://preview.redd.it/wn0gdfk1p1t61.png?width=1121&format=png&auto=webp&s=aba5570c491106af241e2460da22e6d796ccb8a9)](https://preview.redd.it/wn0gdfk1p1t61.png?width=1121&format=png&auto=webp&s=aba5570c491106af241e2460da22e6d796ccb8a9)

The indenture is discharged upon redemption which can be on or before 11am on the redemption date, as per section 3.05 of the indenture filing (see previous picture).

So, now that GameStop has filed the redemption notice and issued the redemption date it can end the indenture at any point by depositing the required funds with the US Bank National Association. This is explained in section 8.02 and 8.04a of the indenture filing. The redemption notice gives the date of April 30th, but *the indenture is discharged when GameStop pays the redemption which they can do at any point before 11am April 30th as per section 3.05 of the indenture filing*.

Implication: I believe that, if GameStop wanted to, they could declare a dividend on the 15th of April alongside the contents of their shareholders meeting. They could declare the record date for *both* the dividend and voting rights as the 20th of April. If they really wanted, they could purchase shares from the market too. *Basically, now that they have filed this notice the restrictions are lifted as soon as the money is deposited with the bank.*

(As usual, this is not financial advice. If you notice any errors I have made, please point them out in the comments!)

Edit: several people have asked, in the comments, why a dividend is important and how it would hurt short sellers. I have written an answer [here](https://www.reddit.com/r/Superstonk/comments/mqn97y/an_explanation_of_why_a_dividend_andor_share/?utm_source=share&utm_medium=web2x&context=3) :)
