Blockbuster agrees to declassify its Board of Directors

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Comptroller William C. Thompson, Jr., today announced that Blockbuster has agreed to a proposal by four of New York City’s Pension Funds to repeal the classified structure of its Board of Directors to allow for the annual elections of all of its directors.

Blockbuster, Inc., of Dallas, Texas, currently groups its directors into classes, with each class elected at successive annual meetings. The Funds opposed the structure because it limits shareholders’ ability to evaluate and elect the company’s entire Board of Directors on an annual basis and reduces accountability.

“The ability to elect directors is the single most important use of the shareholder franchise,” Thompson said. “Accordingly, directors should be accountable to shareholders on an annual basis. The election of directors by classes, for three-year terms, in our opinion, precludes the full exercise of the rights of shareholders to approve or disapprove annually the performance of a director or directors.”

The proposal was supported at a meeting of the Company’s Board of Directors on March 19, 2007. Blockbuster stated its board, “believes that the de-classification of the board is consistent with best corporate governance practices.” The directors voted to recommend that Blockbuster’s stockholders approve, at the 2007 annual meeting, an amendment to the Company’s certificate of incorporation to eliminate the classification of the board of directors and to provide for annual election of all directors.

The proposal was sponsored by the Teachers’ Retirement System for the City of New York (TRS), New York City Police Pension Fund, New York City Fire Department Pension Fund and the New York City Board of Education Retirement System (BERS).

Collectively, the four Funds own 382,378 shares valued at more than $2.6 million in Blockbuster.

Besides Thompson, the Pension Funds’ trustees are:

Fire Department Pension Fund: Mayor Michael Bloomberg; New York City Fire Commissioner Nicholas Scoppetta (Chair); New York City Finance Commissioner Martha E. Stark; Stephen Cassidy, President, James Slevin, Vice President, Robert Straub, Treasurer, and John Kelly, Brooklyn Representative and Chair, Uniformed Firefighters Association of Greater New York; Peter Gorman, President and Captains’ Rep., Nicholas J. Visconti, Chiefs’ Rep., and Stephen J. Carbone, Lieutenants’ Rep., Uniformed Fire Officers Association; and, Joseph Gagliardi, Marine Engineers Association.

Police Pension Fund: Mayor Michael Bloomberg; New York City Finance Commissioner Martha E. Stark; New York City Police Commissioner Raymond Kelly (Chair); Patrick Lynch, Patrolmen’s Benevolent Association; Michael Palladino, Detectives Endowment Association; Edward Mullins, Sergeants Benevolent Association; Anthony Garvey, Lieutenants Benevolent Association; and, John Driscoll, Captains Endowment Association.

TRS: New York City Finance Commissioner Martha E. Stark (Chair); Deputy Chancellor Kathleen Grimm, New York City Department of Education; and, Sandra March, Melvyn Aaronson and Mona Romain, all of the United Federation of Teachers.

BERS: mayoral appointees Schools Chancellor Joel Klein, Alan Aviles, Philip Berry, David Chang, Tino Hernandez, Augusta Souza Kappner, Richard Menschel and Marita Regan; Borough President appointees Jesse Mojica (Bronx), Martine G. Guerrier (Brooklyn), Vivian Farmery (Manhattan), Michael Flowers (Queens), and Joan Correale (Staten Island); and employee members Thomas J. Malanga of the International Union of Operating Engineers, Local 891, and  Milagros Rodriguez of District Council 37, Local 372.

You can view the resolution at www.comptroller.nyc.

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