Here's a link to the information you seek. The relevant sections are quoted below.
Catalyst Switch GigaStack Configuration and Implications
http://www.cisco.com/warp/public/473/150.html
"Cascaded Stack Connections with a Redundant Link
Cascaded stack configuration with a redundant link consists of one GigaStack GBIC per switch. Multiple connections exist between these modules. By using one module per switch, you are able to interconnect between three and nine switches using only one GigaStack module per switch. The cable is daisy chained between switches by connecting opposite port numbers between switches. Port 1 to neighboring switch port 2 and so on. Physical redundancy occurs when you complete the connection between the first and last switch. Every port in all GigaStack modules will have a connection in use.
In this configuration, all GigaStack interfaces will automatically negotiate to half-duplex. All GigaStack ports will act as a repeater and share the one Gbps channel. A loop configuration will be detected by a loop detection algorithm and one of the links on a GigaStack module will be used as the redundant link. The redundant link in the stack is disabled for data transmission while all other links in the stack are up. When another link in the stack goes down, the redundant link will be enabled for data transmission. No user intervention is required."
and
"Message: %GIGASTACK-6-LOOP_DETECTED
In a redundant loop configuration, an election of which GigaStack link is to be blocked occurs, also known as master loop breaker. All the LEDs on all GigaStacks will flash amber. Once the master loop breaker has been elected, all GigaStack LEDs will be solid green with the exception of the blocked master loop breaker. This link will be solid amber.
The following message is displayed on the elected master loop breaker switch:
%GIGASTACK-6-LOOP_DETECTED: Gigastack GBIC in is selected as Master Loop Breaker.
Link 2 of the master loop breaker GigaStack GBIC is disabled to break the loop. Issuing the show interface command on the master loop breaker port will display the following:
GigaStack module(0.1) in GBIC slot. link1 is up, link2 is redundant link.
This is normal operation and the message is for informational purposes only. During this time, you may see the links go up/down multiple times. This is normal behavior.
The loop breaking algorithm occurs between the GigaStack GBICs by exchanging MAC addresses using their A- and B-ports. The winner of the election will become the master loop breaker and disable its port 2. The winner of the election is the one with the lowest byte-order reversed MAC address. If a gig port has the MAC address 00:d0:79:6b:ee:01, the the byte-order reversed MAC address is 01:EE:6b:79:d0:00.
To find out which switch will disable its B-port, issue the sh int gig x/y command on each switch and make note of the MAC address in parentheses (the one that says bia and then a MAC address). With this information, perform the byte-order reversing operation and then compare them to find the smallest one. The smallest one will be the master loop breaker and will disable it's port 2."
