CONFIRMATION
Exhibit 10.4
CONFIRMATION
| Date: | August 12, 2008 | |
| To: | RadioShack Corporation (“Counterparty”) | |
| Telefax No.: | (817) 415-2638 | |
| Attention: | Raymond C. Vines, CPA, CTP | |
| Director - Treasury Operations | ||
| From: | Bank of America, N.A. (“Bank”) | |
| Telefax No.: | (704) 208-2869 | |
The purpose of this communication (this “Confirmation”) is to set forth the terms and conditions of the above-referenced Transaction entered into on the Trade Date specified below between you and us. This Confirmation supplements, forms a part of, and is subject to the Master Terms and Conditions for Convertible Bond Hedging Transactions dated as of August 12, 2008 and as amended from time to time (the “Master Confirmation”) between you and us.
1. The definitions and provisions contained in the Definitions (as such term is defined in the Master Confirmation) and in the Master Confirmation are incorporated into this Confirmation. In the event of any inconsistency between those definitions and provisions and this Confirmation, this Confirmation will govern.
2. The particular Transaction to which this Confirmation relates is entered into as part of an integrated hedging transaction of the Convertible Notes pursuant to the provisions of Treasury Regulation Section 1.1275-6.
3. The particular Transaction to which this Confirmation relates shall have the following terms:
| Trade Date: | August 12, 2008 | |
| Effective Date: | August 13, 2008 | |
| Premium: | USD 29,900,000.00 | |
| Premium Per Unit: | USD92.00 | |
| Premium Payment Date: | August 18, 2008 | |
| Convertible Notes: | 2.50% Convertible Senior Notes of Counterparty due 2013, offered pursuant to an Offering Memorandum to be dated as of August 12, 2008 and issued pursuant to the Indenture. | |
| Number of Units: | The number of Convertible Notes in denominations of USD1,000 principal amount issued by Counterparty on the closing date for the initial issuance of the Convertible Notes. | |
A-1
| Strike Price: | As of any date, an amount in USD, rounded to the nearest cent (with 0.5 cents being rounded upwards), equal to USD1,000 divided by the Unit Entitlement. | |
| Applicable Percentage: | 40% | |
| Number of Shares: | The product of the Number of Units, the Unit Entitlement and the Applicable Percentage. | |
| Expiration Date: | August 1, 2013 | |
| Unit Entitlement: | As of any date, a number of Shares per Unit equal to the Conversion Rate (as defined in the Indenture, but without regard to any adjustments to the Conversion Rate pursuant to the Excluded Provisions of the Indenture). | |
| Indenture: | Indenture to be dated as of August 18, 2008 by and between Counterparty and The Bank of New York Mellon Trust Company, N.A., as trustee, and the other parties thereto pursuant to which the Convertible Notes are to be issued. For the avoidance of doubt, references herein to sections of the Indenture are based on the draft of the Indenture most recently reviewed by the parties at the time of execution of this Confirmation. If any relevant sections of the Indenture are changed, added or renumbered following execution of this Confirmation but prior to the execution of the Indenture, the parties will amend this Confirmation in good faith to preserve the economic intent of the parties. | |
| Purchase Agreement: | Purchase Agreement dated as of August 12, 2008 between Counterparty and Citigroup Global Markets Inc. and Banc of America Securities LLC, as representatives of the Initial Purchasers (as defined in the Purchase Agreement). | |
| Net Share Provision: | Section 15.01(c) of the Indenture | |
| Rounding Provision: | Section 15.01(d) of the Indenture | |
| Make-whole Provision: | Section 15.03 of the Indenture | |
| Conversion Adjustment Provisions: | Sections 15.02(c) and 15.02(e) of the Indenture | |
| Excluded Provisions: | Sections 15.02(f), 15.02(g) and 15.03 of the Indenture | |
| Dilution Provision: | Sections 15.02(a), (b), (c), (d) and (e) of the Indenture | |
| Merger Provision: | The definition of Reorganization Event in Section 15.04(a) of the Indenture | |
| Early Unwind Date: | August 18, 2008 (or such later date as agreed by the parties hereto) or, with respect to any Additional Convertible Notes, the settlement date specified by the Initial Purchasers pursuant to the Purchase Agreement. | |
A-2
Counterparty hereby agrees (a) to check this Confirmation carefully and immediately upon receipt so that errors or discrepancies can be promptly identified and rectified and (b) to confirm that the foregoing (in the exact form provided by Bank) correctly sets forth the terms of the agreement between Bank and Counterparty with respect to the Transaction, by manually signing this Confirmation or this page hereof as evidence of agreement to such terms and providing the other information requested herein or in the Master Agreement and immediately returning an executed copy to John Servidio, Facsimile No. ###-###-####.
| Yours sincerely, | ||
| BANK OF AMERICA, N.A. | ||
| By: | /s/ Christopher A. Hutmaker | |
| Name: | Christopher A. Hutmaker | |
| Title: | Managing Director | |
| Confirmed as of the date first above written: | ||
| RADIOSHACK CORPORATION | ||
| By: | /s/ James Gooch | |
| Name: | James Gooch | |
| Title: | Chief Financial Officer | |
