e424b3
Filed Pursuant to Rule 424(b)(3)
Registration No. 333-44125
Prospectus
RadioShack Shares Plan
CUSIP 750438 10 3
The RadioShack Shares Plan of RadioShack Corporation provides
individual investors with a variety of services, including
(1) automatic reinvestment of cash dividends paid on shares
of RadioShack Corporation common stock, (2) a means of
making optional cash investments in RadioShack common stock of
up to $150,000 per annum, (3) a means of purchasing
shares of RadioShack common stock for others, and (4) the
ability to sell shares of RadioShack common stock through the
Plan. A broker-dealer to be selected is the Agent for stock
purchases and sales.
The price of shares of common stock purchased under the Plan
will be the weighted average cost of all shares purchased by the
Plan Administrator with respect to the applicable Investment
Date. The common stock is traded on the New York Stock Exchange.
The symbol for RadioShack Corporation on the New York Stock
Exchange is RSH. This prospectus relates to
6,000,000 shares of common stock.
To the extent required by applicable law in certain
jurisdictions, shares offered under the Plan are offered through
the Agent.
INVESTING IN OUR COMMON STOCK INVOLVES RISK. YOU SHOULD
CAREFULLY CONSIDER THE RISK FACTORS BEGINNING ON PAGE 3 OF THIS
PROSPECTUS BEFORE MAKING A DECISION TO PURCHASE OUR STOCK.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE
SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED THESE
SECURITIES OR DETERMINED IF THIS PROSPECTUS IS TRUTHFUL OR
COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
The date of this Prospectus is July 3, 2006.
TABLE OF CONTENTS
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ii
Unless otherwise specified, the information in this
Prospectus is set forth as of July 3, 2006. We anticipate
that changes will occur in our affairs after that date. We have
not authorized anyone to give any information or to make any
representations, other than as contained in this Prospectus, in
connection with the offer contained in this document. If anyone
gives you any information or makes any representation in
connection with this offer, you should not rely on it as
information that we have authorized. This Prospectus does not
constitute an offer to sell our common stock in any state or
other jurisdiction where it is unlawful to make such an
offer.
SUMMARY
About RadioShack
RadioShack Corporation is primarily a retailer of consumer
electronics products and services. We seek to differentiate
ourselves from our various competitors by focusing on dominating
cost-effective solutions to meet everyones routine
electronics needs and families distinct electronics wants.
This strategy allows us to take advantage of the unique
opportunities provided by our extensive retail presence,
knowledgeable sales staff, and relationships with reputable
vendors. We believe this strategy provides us with the
opportunity to increase our market share in the highly
competitive consumer electronics area.
We operate company stores located throughout the United States,
as well as in Puerto Rico and the U.S. Virgin Islands.
These stores are located in major shopping malls and strip
centers, as well as individual storefronts. Each location
carries a broad assortment of both private label and third-party
branded consumer electronics products. Our product lines include
wireless telephones and communication devices such as scanners
and two-way radios; residential telephones, DVD players,
computers and
direct-to-home
(DTH) satellite systems; home entertainment, wireless,
imaging and computer accessories; general and special purpose
batteries; wire, cable and connectivity products; and digital
cameras, radio-controlled cars and other toys, satellite radios,
memory players and wellness products. We also provide consumers
access to third-party services such as wireless telephone and
DTH satellite activation, satellite radio service, prepaid
wireless airtime and extended service plans.
We also operate kiosks located throughout the United States.
These kiosks are primarily inside SAMS CLUB locations, as
well as stand-alone Sprint Nextel kiosks we operate in major
shopping malls. These locations, which are not
RadioShack-branded, offer product lines including wireless
handsets and associated accessories, as well as DTH satellite
systems. We also provide consumers access to third-party
wireless telephone services.
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In addition, we have other sales channels and support
operations, including:
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a network of dealer outlets located in the United States and
internationally, |
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our Web site www.radioshack.com, |
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our service and support network to service the consumer
electronics and personal computer retail industry in the United
States, |
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our company-operated stores and dealer outlets located in
Canada, as well as RadioShack-branded stores and dealers in
Mexico (which are operated by a joint venture of which we are a
minority owner), and |
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our established support infrastructure. |
Our principal executive offices are located at 300 RadioShack
Circle, MS CF3-203, Fort Worth, Texas 76102, and the
telephone number is (817) 415-3700.
RadioShack Shares Plan
Some of the advantages and features of the RadioShack Shares
Plan that are described in this Prospectus are
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Participants may acquire additional shares of common stock
automatically by reinvesting their cash dividends in additional
shares of common stock. |
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Persons not presently owning shares of common stock may become
participants by making an initial cash investment for the
purchase of common stock of not less than $250 and not more than
$150,000. |
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Dividends are calculated on all full and fractional shares of
common stock in the Plan. |
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Participants may direct the Plan Administrator to transfer all
or a portion of their shares of common stock in the Plan to the
account of another person. |
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Participants may purchase shares of common stock for family
members and others by making cash investments on their behalf. |
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Participants may, through the Plan, sell shares held by the Plan. |
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Personal recordkeeping is simplified by the Plan
Administrators issuance of statements indicating account
activity. |
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RISK FACTORS
Before making an investment decision, you should carefully
consider the following risks and uncertainties described below,
as well as other information contained or incorporated by
reference in this Prospectus. The risks and uncertainties
described are those presently known to us. Additional risks and
uncertainties not presently known to us or that we currently
deem immaterial may also impair our business operations, our
financial results and the value of our securities. There may be
risks that you view in a different way than we do, and we may
omit a risk that we consider immaterial, but you consider
important. If any of the following risks occur, our business,
financial condition or results of operations could be materially
harmed. In that case, the value or trading price of the
securities registered herein could decline, and you may lose all
or part of your investment.
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Our turnaround strategy may disrupt our business. In
addition, the strategy may not be successful. |
In February 2006, we announced a turnaround strategy with four
components: store rationalization, inventory rationalization,
distribution center consolidation, and expense reduction. This
turnaround strategy may lead to disruptions in our business,
including disruptions from the reduced number of stores,
distribution centers and employees, as well as from the
rationalization of certain products. These disruptions could
adversely affect our business operations and our financial
results. While we believe any disruptions would be short-term,
we cannot assure that the impact (whether short-term or
long-term) from these disruptions would not be material.
Further, the implementation of the program will increase our
expenses and product costs, which, in turn, may affect our
credit ratings and overall liquidity. In addition, if our
turnaround strategy is not successful, or if we do not execute
the strategy effectively, our business operations and financial
results could be adversely affected.
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Any reductions or changes in the growth rate of the
wireless industry or changes in the dynamics of the wireless
communications industry could cause a material adverse effect on
our sales and financial results. |
Sales of wireless handsets and the related commissions and
residual income constitute approximately one-third of our total
revenue. Consequently, changes in the wireless industry, such as
the ones discussed below, could have a material adverse effect
on our results of operations and financial condition.
Lack of growth in the overall wireless industry tends to have a
corresponding effect on our wireless sales. Because growth in
the wireless industry is often driven by the adoption rate of
new wireless handset technologies (such as camera or video
phones), the absence of these new
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technologies, or the lack of consumer interest in adopting these
new technologies, could lead to slower growth, or a decline, in
overall wireless industry sales, as well as in our sales.
Other changes in the wireless industry that could materially and
adversely affect our sales include wireless industry
consolidation. Consolidation in the wireless industry could lead
to a concentration of competitive strength, particularly
competition from wireless carriers retail stores, and
could, therefore, adversely affect our sales as competitive
levels increase.
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The recent changes in our wireless carrier relationships
may not be successful, which could cause a material adverse
effect on our operations and financial results. |
In July 2005, we signed a long-term agreement with Cingular
Wireless to begin offering their GSM wireless service in our
stores in January 2006. As a result of entering into this
agreement with Cingular, we discontinued the sale of Verizon
Wireless products and services at the end of 2005. Also,
in July 2005, we amended our existing relationship with Sprint
PCS. Sprint subsequently acquired Nextel, and we began offering
Nextel products and services in our stores. As a result of these
changes, we have experienced temporary interruptions in our
business. Additional interruptions could result from changes in
selling techniques, marketing approaches, customer base, and
product selection. In addition, these changes could impact our
financial results due to changes in our compensation model,
residual income, commission income, gross margins, and handset
sales.
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Our inability to effectively manage our inventory levels,
particularly excess or inadequate amounts of inventory, could
adversely affect our financial results. |
We source inventory both domestically and internationally, and
our inventory levels are subject to a number of factors beyond
our control. These factors, including reduced consumer spending
and consumer disinterest in our product offerings, could lead to
excess inventory levels. Additionally, we may not assess
appropriate product life cycles or
end-of-life products,
leaving us with excess inventory. To reduce these inventory
levels, we may be required to lower our prices, adversely
impacting our margin levels and our financial results.
Alternatively, we may have inadequate inventory levels for
particular items, including popular selling merchandise, due to
factors such as unavailability of products from our vendors,
import delays, labor unrest, untimely deliveries or the
disruption of international, national or regional transportation
systems. The occurrence of any of these factors on our inventory
supply could adversely impact our financial results.
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We may not be able to maintain our historical gross margin
levels. |
Historically, we have maintained gross margin levels of
approximately 50%. We may not be able to maintain these margin
levels in the future due to various factors, as well as higher
sales of lower margin products such as personal electronics
products and third-party branded products. If sales of these
lower margin items continue to increase, our overall gross
margin levels will be adversely affected.
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Changes in the financial markets or in our results of
operations could reduce or eliminate our access to longer term
capital or short-term credit availability, which could adversely
affect our financial condition and liquidity. |
Depending on our cash flow levels, we may periodically borrow
funds in the short-term commercial paper market to fund, among
other things, our inventory purchases and operational
expenditures. Adverse changes in the financial markets that
restrict the availability of funds for capital markets
borrowing, as well as adverse changes in our results of
operations and financial condition, could cause the short-term
commercial paper market to be unavailable to us. In this event,
we would be required to utilize our bank credit facilities.
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We may be unable to successfully execute our solutions
strategy to dominate cost-effective solutions to meet
everyones routine electronics needs and families
distinct electronics wants. |
To achieve our solutions strategy, we have undertaken a variety
of strategic initiatives. Our failure to successfully execute
our strategy or the occurrence of any of the following events
could have a material adverse effect on our business:
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Our inability to improve the customer experience in our core and
close-to-core channels;
to rationalize and improve our infrastructure; to leverage our
assets to create new streams of revenue and profit; and to
attract, retain, develop, mentor and reward great people; |
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Our inability to optimize and execute our strategic plans,
including our kiosk operations and other sales channels; and |
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Our inability to successfully identify and analyze emerging
growth opportunities in the areas of strategic business
alliances, acquisitions, licensing opportunities, new markets,
non-store sales channels, and innovative products. |
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Our competition is both intense and varied, and our
failure to effectively compete could adversely affect our
prospects. |
In the retail consumer electronics marketplace, the level of
competition is intense. We compete primarily with retail stores
and, to a lesser extent, with alternative channels of
distribution such as
e-commerce, telephone
shopping services and mail order. Changes in the amount and
degree of promotional intensity or merchandising strategy
exerted by our current competitors and potential new competition
could present us with difficulties in retaining existing
customers, attracting new customers and maintaining our profit
margins. Furthermore, while we recently re-deployed our
RadioShack.com
e-commerce site, the
modifications to this site may not be sufficient to adequately
compete with other
e-commerce competitors.
In addition, some of our competitors may use strategies such as
lower pricing, wider selection of products, larger store size,
improved store design, and more efficient sales methods. While
we attempt to differentiate ourselves from our competitors by
focusing on the electronics specialty retail market, our
business model may not allow us to compete successfully against
existing and future competitors.
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Adverse changes in national or regional U.S. economic
conditions could negatively affect our financial results. |
Adverse economic changes have a significant negative impact on
consumer spending, particularly discretionary spending for
consumer electronics products, which, in turn, could directly
affect our overall sales. Consumer confidence, recessionary and
inflationary trends, equity market levels, consumer credit
availability, interest rates, consumers disposable income
and spending levels, energy prices, job security and
unemployment rates directly impact the volume of customer
traffic and level of sales in our locations. Negative trends of
any of these economic conditions, whether national or regional
in nature, could adversely affect our financial results,
including our net sales and profitability.
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Our inability to increase or maintain the level of sales
in both our wireless and non-wireless platforms could adversely
affect our results. |
A critical component of our business results is continued
increases in our sales levels. Our ability to increase sales in
existing stores may also be affected by:
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Our success in driving customers into our stores, |
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Our ability to maintain fully-staffed stores and trained
employees, |
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Our ability to keep stores stocked with the correct
merchandise, and |
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Our ability to choose the correct mix of products to sell. |
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The occurrence of severe weather events or natural
disasters could significantly damage or destroy outlets or
prohibit consumers from traveling to our retail locations,
especially during the peak winter holiday shopping
season. |
If severe weather, such as a large hurricane, tornado or
earthquake, occurs in a particular region and damages or
destroys a significant number of our stores in that area, our
overall sales would be reduced accordingly. In addition, if
severe weather, such as heavy snowfall or extreme temperatures,
discourages or restricts customers in a particular region from
traveling to our stores, our sales would also be adversely
affected. If severe weather occurs during the fourth quarter
holiday season, the adverse impact to our sales could be even
greater than at other times during the year because we generate
a significant portion of our sales during this period.
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Any additional terrorist activities in the U.S., as well
as the international war on terror, may adversely affect our
sales and our stock price. |
An additional terrorist attack or series of attacks on the
United States could have a significant adverse impact on the
United States economy. This downturn in the economy could,
in turn, have a material adverse effect on our sales.
Furthermore, the threat of terrorist attacks in the United
States since September 11, 2001, as well as the ongoing
international war on terror, continues to create economic and
political uncertainties in the United States. The potential for
future terrorist attacks, the national and international
responses to terrorist attacks, and other acts of war or
hostility could cause greater uncertainty and cause the economy
to suffer in ways that we currently cannot predict. In addition,
these events could cause or contribute to a general decline in
equity valuations, which, in turn, could reduce the market value
of RadioShack.
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If we fail to enter into, maintain and renew profitable
relationships with providers of third-party branded products,
our sales and gross margins could be adversely affected. |
Our large selection of third-party branded products makes up a
significant portion of our overall sales. If we are unable to
create, maintain or renew our relationships with the suppliers
of these products, our sales and our gross margins could be
adversely impacted.
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Our inability to successfully identify and enter into
relationships with developers of new technologies or the failure
of these new technologies to be adopted by the market could
impact our ability to increase or maintain our sales.
Additionally, the absence of new services or products and
product features in the merchandise categories we sell could
adversely affect our sales. |
Our ability to maintain and increase revenues depends, to a
large extent, on the periodic introduction and availability of
new products and technologies. If we fail to identify these new
products and technologies, or if we fail to enter into
relationships with their developers prior to widespread
distribution within the market, our sales and gross margins
could be adversely affected. Furthermore, it is possible that
these new products or technologies will never achieve widespread
consumer acceptance, also adversely affecting our sales.
Finally, the lack of innovative consumer electronics products,
features or services that can be effectively featured in our
store model could also impact our ability to increase or
maintain our sales.
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The inability to attract, retain and grow an effective
management team or changes in the cost or availability of a
suitable workforce to manage and support our operating
strategies could cause our operating results to suffer. |
Our success depends in large part upon our ability to attract,
motivate and retain a qualified management team and employees.
Qualified individuals needed to fill these positions could be in
short supply. The inability to recruit and retain such
individuals could result in high employee turnover at our stores
and in our company overall, which could have a material adverse
effect on our business and financial results. Additionally,
competition for qualified employees requires us to continually
assess our compensation structure. Competition for qualified
employees has required, and in the future could require, us to
pay higher wages to attract a sufficient number of qualified
employees, resulting in higher labor compensation expense.
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We have contingent lease obligations related to our
discontinued retail operations that, if realized, could
materially and adversely affect our financial results. |
We have contingent liabilities related to retail leases of
locations which were assigned to other businesses. The majority
of these contingent liabilities relate to various lease
obligations arising from leases assigned to CompUSA, Inc. as
part of the sale of our Computer City, Inc. subsidiary to
CompUSA in August 1998. In the event CompUSA or the other
assignees, as applicable, are unable to fulfill these
obligations, we would be responsible for rent due under the
leases, which could have a material adverse affect on our
financial results.
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Failure to comply with, or the additional implementation
of, restrictions or regulations regarding the products and/or
services we sell or changes in tax rules and regulations
applicable to us, could adversely affect our business and our
results of operations. |
We are subject to various federal, state, and local laws and
regulations including, but not limited to, the Fair Labor
Standards Act, as amended, and regulations promulgated by the
Internal Revenue Service, the United States Department of Labor,
the Occupational Safety and Health Administration, and the
Environmental Protection Agency. Failure to properly adhere to
these and other applicable laws and regulations could result in
the imposition of civil and criminal penalties or adverse legal
judgments and could adversely affect our business and our
results of operations. Similarly, the cost of complying with
newly-implemented laws and regulations could adversely affect
our business and our results of operations.
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Any potential tariffs imposed on products that we import
from China, as well as the potential sudden strengthening of
Chinas currency against the U.S. dollar, could reduce
our gross margins and our overall profitability. |
We purchase a significant portion of our inventory from
manufacturers located in China. Changes in trade regulations
(including tariffs on imports) or the continued strengthening of
the Chinese currency against the U.S. dollar could increase
the cost of items we purchase, which in turn could have a
material adverse effect on our gross margins.
FORWARD LOOKING STATEMENTS
We have included in this Prospectus, as well as in the documents
incorporated by reference in this Prospectus, statements
containing forward-looking information, as defined
by the Private Securities Litigation Reform Act of 1995. We have
used the words anticipate, intend,
may, expect, believe,
plan, will, estimate,
should or other comparable and similar expressions
in this Prospectus and in the documents incorporated by
reference to identify such forward-looking statements.
Forward-looking information, by its nature, involves estimates,
projections, goals, forecasts, assumptions, risks and
uncertainties that could cause actual results or outcomes to
differ materially from those expressed in a statement that
contains forward-looking information. Any statement containing
forward-looking information speaks only as of the date on which
it is made, and, except to fulfill our obligations under the
U.S. securities laws, we undertake no obligation to update
any such statement to reflect events or circumstances after the
date on which it is made. Examples of factors that can affect
our expectations, beliefs, plans, goals, objectives and future
financial or other performance are discussed under the heading
Risk Factors. All such factors are difficult to
predict, contain uncertainties that may materially affect actual
results, and may be beyond
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our control. It is not possible for our management to predict
all of such factors or to assess the effect of each such factor
on our business. New factors emerge from time to time, and may
be found in the future SEC filings incorporated by reference in
this Prospectus in the section captioned Where You can
Find More Information.
TERMS AND CONDITIONS
Administration and Contact Information
RadioShack, through Wells Fargo Shareowner Services, a division
of Wells Fargo Bank, N.A., the Plan Administrator, administers
the Plan, keeps records, sends statements of account activity to
participants and performs clerical and ministerial duties
related to the Plan. The Plan Administrator purchases, sells and
holds all shares of common stock acquired under the Plan.
You may contact the Plan Administrator by:
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U.S Mail (other than Certified/ Overnight Mail): |
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RadioShack Shares Plan |
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Wells Fargo Shareowner Services |
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P.O. Box 64856 |
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St. Paul, MN 55164-0856 |
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Certified/ Overnight Mail: |
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RadioShack Shares Plan |
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Wells Fargo Shareowner Services |
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161 North Concord Exchange |
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South St. Paul, MN 55075-1139 |
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(888) 218-4374 (within the United States) |
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(651) 450-4064 (outside the United States, including Puerto
Rico) |
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An automated voice response system is available 24 hours a
day, |
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7 days a week. Customer Service Representatives are
available from |
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7:00 a.m. to 7:00 p.m., Central Standard Time, Monday
through |
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Friday. |
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www.wellsfargo.com/shareownerservices (for general
information) |
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www.shareowneronline.com (for account information) |
Unless otherwise specified, Plan transactions can be handled via
the Internet, by telephone, or through the mail.
You should include in all correspondence your stockholder
account number, taxpayer identification number and daytime
telephone number where you may be contacted during normal
working hours to facilitate a prompt response.
Who Can Join
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Registered stockholders of RadioShack are eligible to join the
Plan. |
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New investors who would like to become registered stockholders
may join by paying a $10 enrollment fee and by making an initial
investment between $250 and $150,000. |
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Non-U.S. residents
are eligible to participate as long as their participation would
not violate applicable laws in their home countries. |
Plan Enrollment
Registered Stockholders. If you are currently a
stockholder of record, you may enroll in the Plan at any time by
completing and returning an application form. Requests for such
forms should be directed to the Plan Administrator, either by
telephone, electronically or in writing.
Beneficial (Street Name) Owners. If your
shares are held in the name of a bank, broker, or other nominee
(that is, in street name), you should direct your
bank, broker or other nominee to have your shares registered
directly in your name. You can then enroll in the Plan as a
registered stockholder.
New Investors. If you are not currently a stockholder of
record, you may join the Plan by paying a $10 enrollment fee and
by completing and returning an application form together with an
initial investment of not less than $250 and not more than
$150,000, which will be used to purchase common stock for your
account. This minimum initial investment amount of $250 will be
waived, however, if you sign up for monthly Automated Clearing
House (ACH) investments, as described below. The $10
enrollment fee will be deducted from the initial investment
amount. Go to www.shareowneronline.com and follow the
instructions for opening an account online, or contact the Plan
Administrator to request an application form.
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Initial Investments
Your initial investment will be invested in common stock on the
next Investment Date (as defined below), provided that payment
is received by the Plan Administrator within the applicable
minimum time period. Purchases of common stock for your account
are made as soon as practicable after receipt of your initial
investment, and in no event later than 20 days after
receipt of payment. Investment Dates during any month are
determined solely at the discretion of the Plan Administrator.
However, it is anticipated to be the practice of the Plan
Administrator to make purchases on behalf of Plan participants
twice each month. We call each one of these days the Investment
Date.
Application forms, including online internet applications, and
initial investments must be received by the Plan Administrator
at least two business days prior to an Investment Date and are
subject to review by the Plan Administrator. Interest is not
paid on any funds received, and funds do not earn dividends
prior to their investment.
As soon as practicable after completion of your initial
investment, the Plan Administrator will distribute to you a
statement notifying you of the establishment of your account and
setting forth the details of your investment. Receipt of such
statement serves as notification of your enrollment in the Plan.
RadioShack may elect not to offer or sell shares of common stock
through the Plan to persons residing in any jurisdiction or
foreign country where, in the judgment of RadioShack, the burden
or expense of compliance with applicable state blue sky or
securities laws makes such offer or sale there impracticable or
inadvisable. In any of these circumstances, dividends, if and
when declared, will be paid in the usual manner to the person,
and any cash payment received from such person will be returned
to such person.
Optional Cash Investments
Once you are enrolled in the Plan, for a transaction fee of
$5 per check investment or $1.50 per Automated
Clearing House (ACH) investment, you may make additional
share purchases using the Plans optional cash investment
feature. The only restrictions that apply to making optional
cash investments are that they be made in amounts of not less
than $50 per investment nor more than $150,000 per
annum including your initial investment. The Plan Administrator
cannot waive these restrictions.
The Plan Administrator will invest your funds on the next
Investment Date, if it is received at least one business day
prior to that Investment Date. The Plan Administrator will
invest your
12
payment with those of other participants and apply them to the
purchase of additional shares of common stock, which it will
hold as custodian.
As is the case with initial investments, RadioShack and the Plan
Administrator will not pay interest on any optional cash funds
received and held for investment under the Plan, and funds do
not earn dividends prior to their investment. Therefore, it is
to your benefit for an optional cash investment to be received
by the Plan Administrator shortly, but not less than applicable
minimum period of time, before an Investment Date. You are under
no obligation to make additional cash investments.
During the period that an optional cash investment is pending,
the collected funds in the possession of the Plan Administrator
may be invested in certain permitted investments. These
permitted investments include any money market
mutual funds registered under the Investment Company Act
(including those of an affiliate of the Plan Administrator or
for which the Plan Administrator or any of its affiliates
provides management advisory or other services) consisting
entirely of (1) direct obligations of the United States of
America or (2) obligations fully guaranteed by the United
States of America. The Plan Administrator will bear the risk of
any loss from these permitted investments, and the Plan
Administrator will retain any investment income from these
Permitted Investments.
If any optional cash contribution, including payments by check
or automatic withdrawal, is returned for any reason, the Plan
Administrator will remove from your account any shares purchased
upon prior credit of these funds and will sell these shares. The
Plan Administrator may sell other shares in the account to
recover a returned funds fee for each optional cash investment
returned unpaid for any reason and may sell additional shares as
necessary to cover any market loss incurred by the Plan
Administrator.
Refunds of Initial Investments and Optional Cash
Investments
Upon written request, the Plan Administrator will, prior to
actual investment, refund your initial investment or any
optional cash investment, provided your request is received by
the Plan Administrator at least two business days prior to the
next Investment Date. Refunds will be made within three weeks.
Methods of Investment
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Check. Initial investments and optional cash investments
may be made by check, in United States dollars and drawn on a
United States bank account, payable to Shareowner Services. |
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Automatic Monthly Investment. An initial investor and a
Plan participant may also authorize an automatic debit through
an ACH withdrawal. This investment is accomplished, on or about
the
20th day
of each month by completing the appropriate section of the
application form or by notifying the Plan Administrator in
writing. The debit to your bank account occurs approximately
five days before an investment is made. To be effective with
respect to a particular investment date, requests to enroll in,
change, or discontinue Automatic Monthly Investments must be
received by the Plan Administrator at least 15 business days
prior to an Investment Date. |
Dividend Reinvestment Options
The reinvestment option you select will apply to all shares of
common stock you own of record, whether held in certificate
form, book-entry (DRS) or in the Plan. When enrolling in
the Plan, you may select one of the following reinvestment
options:
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Full Dividend Reinvestment. All cash dividends on shares
held in physical certificate form registered in your name,
including book-entry (DRS), on the records of RadioShack and all
cash dividends on all Plan shares credited to your account under
the Plan will be used to purchase additional shares. You will
not receive cash dividends from RadioShack; instead, the
dividends will be reinvested. |
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Partial Dividend Reinvestment. All cash dividends on a
percentage (chosen by you) of both your Plan shares and shares
held by you in physical certificate form, including book-entry
(DRS), will be used to purchase additional shares. You may elect
percentages from 10% up to 90% in increments of 10%. If you
elect Partial Dividend Reinvestment, you will receive a check or
direct deposit from RadioShack for dividends, when declared and
paid, only for those shares not subject to dividend reinvestment. |
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Cash Payments Only (No Dividend Reinvestment). All cash
dividends on shares held in physical certificate form registered
in your name, including book-entry (DRS), on the records of
RadioShack and all cash dividends on all Plan shares credited to
your account under the Plan will continue to be received, as
declared, by check or direct deposit. |
You may change your reinvestment option at any time by calling,
going online or sending written notice to the Plan
Administrator. For information on telephone and online access to
your account, see Telephone Access and
Internet Access below. Notices received on or before
a dividend record date will be effective for that dividend.
Notices received after a dividend record date will not be
effective until after that dividend has been paid. You may also
send in optional cash investments with any of the above options.
14
Dividend record dates are publicly announced by RadioShack. As
of the date of this Prospectus, RadioShack pays dividends on an
annual basis; however, RadioShack may change the amount and
timing of dividends at any time without notice.
On each applicable Investment Date, the Plan Administrator will
(after deducting withholding taxes, if any) apply the cash
dividends to the purchase of shares of common stock for all
participants who are reinvesting their dividends in the Plan.
The Plan Administrator will credit the proportionate number of
shares (computed to three decimal places) purchased by the Plan
Administrator to each participants account. The dividend
reinvestment feature of the Plan has no associated transaction
cost.
If you select the Partial Dividend Reinvestment or Cash Payments
Only option, you can have your cash dividends not being
reinvested transferred directly to your bank for deposit. For
electronic direct deposit of dividend funds, contact the Plan
Administrator to request a Direct Deposit of Dividends
Authorization Form, then complete and return the form to the
Plan Administrator. Be sure to include a voided check for
checking accounts or savings deposit slip for savings accounts.
If your stock is jointly owned, all owners must sign the form.
Purchase of Shares
All shares of common stock will be purchased in the open market.
RadioShack will not utilize newly issued RadioShack common stock
for Plan participants to purchase.
The Plan Administrator may commingle each participants
funds with those of other participants for the purpose of
executing purchases. Neither RadioShack Corporation nor any
affiliated purchasers will exercise any direct or indirect
control or influence over the times when or prices at which the
Plan Administrator may purchase common stock for the Plan, the
amounts of shares to be purchased or the selection of a
broker-dealer through which purchases for the Plan may be
executed.
The price that you will pay for any shares purchased will be the
weighted average cost of all shares purchased (initial
investment, optional cash and dividend reinvestment) by the Plan
Administrator in relation to the applicable Investment Date,
including brokerage commissions and fees. Participants will be
charged a fee of $5.00 per optional cash investments made
by check or $1.50 for optional investments made by monthly ACH.
Please note that you will not be able to instruct the Plan
Administrator to purchase shares at a specific time or at a
specific price. Therefore, you will not be able to time
precisely your purchase through the Plan, and you will bear the
market risk associated with fluctuations in the market price of
shares. If you send in an initial or additional investment or
authorize automatic deductions, it is possible that the market
price of shares could increase or decrease before the Plan
Administrator
15
purchases shares with your funds. In addition, you will not earn
interest on investments for the period before the shares are
purchased.
After each transaction is made, a detailed statement will be
distributed to you indicating, among other things, the amount
invested, the number of shares purchased, the average cost per
share and fees paid.
Stock Certificates/ Book-Entry Shares
All shares purchased on your behalf through the Plan will be
held by the Plan Administrator in book-entry form. In addition,
all shares distributed under the Plan will be in book-entry
form. RadioShack does not issue stock certificates under any
circumstances.
Transferring Plan Shares to Others
You can transfer RadioShack common stock through the Plan to
other persons in three ways:
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You can make an initial investment to establish an account in
the recipients name. Simply complete and submit to the
Plan Administrator an application in the recipients name
together with the required initial investment of not less than
$250 and not more than $150,000; or |
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You can submit an optional cash payment in an amount of not less
than $50 nor more than $150,000 on behalf of an existing Plan
participant; or |
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You can transfer shares from your account to the account of
another person. To transfer shares, mail the Plan Administrator
a properly executed stock assignment form with a medallion
signature guarantee and a letter of instruction. |
Unless instructed otherwise, the Plan Administrator will retain
the shares and enroll the transferee in 100% dividend
reinvestment. The new participant will receive a statement
showing the number of shares transferred and now held in his or
her Plan account.
If you request to transfer all shares in your Plan account
between a dividend record date and payable date, the transfer
request will be processed; however, your Plan account will not
be terminated. You may receive additional dividend reinvestment
shares which will require you to submit a written request to
transfer the additional shares.
Sale of Shares
You can sell all or part of your shares held by the Plan
Administrator by furnishing the Plan Administrator with written
instructions by letter signed by all registered holders or by
calling
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(888) 218-4374. Sales of shares may also be completed by
means of the Internet; please visit
www.shareowneronline.com for more details. The Plan
Administrator may require a signature guarantee for telephone
sales of $25,000 or more.
The Plan Administrator cannot sell for you any certificated
shares that you may be holding unless you convert these shares
into book-entry (DRS) form. See Direct
Registration below for more information. Proceeds from the
sale of shares will be mailed to the stockholder of record or,
if requested, deposited electronically to the stockholders
bank account.
If you submit a request to sell all or a portion of the shares
held by the Plan Administrator, and you are requesting the net
proceeds be automatically deposited to a bank checking or
savings account, you must provide a voided blank check for a
checking account or blank savings deposit slip for a savings
account. If you are unable to provide a voided check or deposit
slip, the written request must have your signature(s) medallion
guaranteed by an eligible financial institution for direct
deposit. Requests for automatic deposit of sale proceeds that do
not provide the required documentation will not be honored, and
a check for the net proceeds will be issued.
The Plan Administrator will make every effort to process your
sale order on the next business day following receipt of a
properly completed request (please note, however, that sale
requests involving multiple transactions may experience a
delay). RadioShack and the Plan Administrator will not be liable
for any claim arising out of failure to sell stock on a certain
date or at a specific price. Selling participants should be
aware that the share price of common stock may fall or rise
during the period between a request for sale, its receipt by the
Plan Administrator, and the ultimate sale in the open market.
Participants should evaluate these risks while deciding whether
and when to sell any shares through the Plan as these risks are
borne solely by the participant.
When you sell your shares, the price per share that you will
receive is the weighted average price of all Plan shares sold by
the Plan Administrator on that day less a $15.00 transaction
fee. Your proportionate share of trading fees of $0.10 per
share and any withholding tax will also be deducted from the
sale proceeds.
Telephone Access
If you have established telephone access privileges on your
account, you can:
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Change the amount of or stop automatic monthly bank withdrawals; |
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Change your dividend reinvestment option (for example, from full
to partial reinvestment); and |
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Sell some or all of your plan shares if the current market value
of the shares to be sold is $25,000 or less. |
To establish telephone access privileges, please call the Plan
Administrator and request an Automated Request Authorization
form.
Internet Access
You may access your account information and perform transactions
on the internet.
For shareholders of record, to activate your account and
establish a Personal Identification Number (PIN), you will need
your 10-digit Plan account number (which is listed on your
account statement), your Social Security number, your email
address, and the company name you own stock in (i.e.,
RadioShack Corporation).
To access your online account, go to
www.shareowneronline.com and click First Time
Visitor Sign Up. Next, simply follow the instructions
found on the First Time Visitor, New Member
Registration page. Once you have successfully signed up,
you will receive an
e-mail notifying you
that your account information is available (typically, the next
business day).
Once you have activated your account online, you can also:
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Authorize, change or stop your Automatic Cash Withdrawal and
Investment Service; |
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Change your dividend reinvestment option (for example, from full
to partial reinvestment); and |
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Sell some or all of your Plan shares if the current market value
of the shares to be sold is $25,000 or less. |
Changing Your Plan Options
You can change the elections you have made under the Plan at any
time by providing notice to the Plan Administrator. You may also
change your Plan options online; visit
www.shareowneronline.com for more details. The Plan
Administrator will accept notice from only you or a person duly
authorized in writing to act on your behalf.
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Termination of Plan Participation
Your enrollment in the Plan may be automatically terminated if
you no longer hold any certificated shares and your book-entry
Plan shares total less than one full share of common stock. Upon
automatic termination, you will be sent a check for the proceeds
from the sale of the fractional share, less trading fees, a
transaction fee, and withholding tax, if any.
In addition, you may send a notice to the Plan Administrator
requesting termination of participation in the Plan. Your
termination notice should specify whether you wish to
(1) convert all your full Plan shares to book-entry
(DRS) and sell the remaining fraction, (2) sell all of
your Plan shares, or (3) convert a specified number of full
Plan shares to book-entry (DRS) and sell the remaining
shares. Participants will receive a check or direct deposit in
the amount of any fractional or full shares sold, less any
brokerage commission and service fees. Future dividends will be
paid in cash. If no election is made in the request for
termination, full Plan shares will be converted to book-entry
(DRS) and a check will be issued for net proceeds of the
fractional share.
With respect to the sale of fractional shares, the Plan
Administrator will pay cash to you in an amount determined in
the same manner as provided with respect to the sale of full
shares.
Upon termination of Plan participation, a statement and/or check
will be sent to only you or your legal representative.
If your request to terminate participation in the plan is
received on or after a dividend record date, but before the
dividend payment date, your termination will be processed as
soon as practicable, and a separate dividend check will be
mailed to you. Future dividends will be paid in cash, unless you
rejoin the Plan.
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Summary of Plan Fees
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Plan Fees |
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Certificated and Book-Entry Shares |
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Enrollment fee
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$10.00 per account enrollment |
Purchase of shares:
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Transaction fee cash or money order
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$5.00 per purchase transaction |
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Transaction fee ACH
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$1.50 |
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Trading fee
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No charge |
Sale of shares (partial and full):
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Transaction fee
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$15.00 per sale transaction |
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Trading fee
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$0.10 per share |
Reinvestment of cash dividends
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No charge |
Transfer of shares
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No charge |
Returned checks
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$25.00 per check |
Duplicate statements
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Current Year
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No charge |
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Prior Year(s)
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$15.00 per year requested |
The Plan Administrator will deduct the applicable Plan fees from
either the initial or optional investment or proceeds from a
sale.
Tax Consequences of Participation in the Plan
The amount of cash dividends paid by RadioShack is considered
taxable income, even though reinvested under the Plan. The
information return sent to you and the IRS at year-end will show
as dividend income the full amount of dividends reinvested under
the Plan as well as cash dividends paid directly to you, if any.
For United States federal income tax purposes, the cost basis of
shares of common stock acquired through the Plan on any given
Investment Date will be determined by dividing the total of the
dividends reinvested net of taxes withheld, if any, plus your
cash investment (initial or optional), if any, by the number of
shares of common stock, including fractional shares, if any,
acquired on your behalf by the Plan Administrator on that
Investment Date.
In the case of stockholders whose dividends are subject to
United States federal income tax withholding, or backup
withholding, the Plan Administrator will reinvest dividends less
the amount of tax required to be withheld.
The sale of shares through the Plan will be reported to the IRS
and you on Form 1099-B.
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You should consult with your tax advisor for advice applicable
to your particular situation.
Adverse Market Conditions
In the event of an adverse market condition, such as trading
curbs or market closure, the Plan Administrator will not be able
to guarantee the execution of any purchase or sale transactions
according to the terms and conditions of the Plan.
Stock Splits, Stock Dividends and Rights Offerings
You will receive your proportionate share of any stock dividend
or stock split that we declare, based on the total number of
shares owned of record by you on the record date for the stock
dividend or stock split, regardless of whether you own these
shares in book-entry or certificated form. However, all of the
shares that you receive from a stock dividend or stock split
will be added to your Plan account in book-entry form (including
shares that you receive based on certificated shares), and you
will not receive shares from a stock dividend or a stock split
in certificated form. In the event that RadioShack makes
available to its stockholders rights to subscribe to additional
shares, debentures or other securities, you will receive these
rights based on the total number of whole shares credited to
your account. You will not receive stock certificates for shares
distributed in connection with a dividend, stock split or
subscription rights. If you send notice of termination or a
request to sell to the Plan Administrator between the record
date and the payable date for a stock distribution, your request
will not be processed until the stock distribution is credited
to your account.
Voting Rights
A proxy card will be sent to you representing the shares of
common stock held in your Plan account combined with any other
shares of common stock that you may own of record (but not for
any other shares of common stock that you own in a brokerage
account or otherwise in street name). Shares
credited to your account under the Plan on the record date for a
vote of stockholders will be voted in accordance with your
instructions. Plan shares for which RadioShack does not either
receive a signed proxy card (or otherwise valid voting
instructions by telephone or internet) will not be voted by the
persons named in the proxy card as your proxy.
Limitations on Liability
Neither RadioShack, the Plan Administrator, nor any broker/
dealer selected by the Plan Administrator to execute purchases
or sales on behalf of Plan participants will be liable for any
act done in good faith or for any omission to act, including,
without limitation, any claims of liability
21
(i) with respect to the prices at which shares are
purchased or sold for your account and the times when such
purchases or sales are made (provided, however, that nothing in
this Prospectus shall be deemed to constitute a waiver of any
rights that you might have under the Securities Act of 1933 or
other applicable federal or state securities laws), or
(ii) for any fluctuation in the market value before or
after purchase or sale of shares, or (iii) for continuation
of your account until receipt by the Plan Administrator of
written notice of termination or written evidence of your death.
The Plan Administrator is acting solely as agent of RadioShack
and owes no duties, fiduciary or otherwise, to any other person
by reason of this Plan, and no implied duties, fiduciary or
otherwise, will be read into this Plan. The Plan Administrator
undertakes to perform these duties and only these duties as are
expressly set forth in this Prospectus, to be performed by it,
and no implied covenants or obligations may be read into this
Plan against the Plan Administrator or RadioShack.
In the absence of negligence or willful misconduct on its part,
the Plan Administrator, whether acting directly or through
agents or attorneys, will not be liable for any action taken,
suffered, or omitted or for any error of judgment made by it in
the performance of its duties as Plan Administrator. In no event
will the Plan Administrator be liable for special, indirect or
consequential loss or damage of any kind (including lost
profit), even if the Plan Administrator has been advised of the
likelihood of such loss or damage and regardless of the form of
action.
The Plan Administrator will (i) not be required to and will
make no representations and have no responsibilities as to the
validity, accuracy, value or genuineness of any signatures or
endorsements, other than its own; and (ii) not be obligated
to take any legal action hereunder that might, in its judgment,
involve any expense or liability, unless it has been furnished
with a reasonable indemnity.
The Plan Administrator will not be responsible or liable for any
failure or delay in the performance of its obligations under
this Plan arising out of or caused, directly or indirectly, by
circumstances beyond its reasonable control, including acts of
God; earthquakes; fires; floods; wars; civil or military
disturbances; sabotage; epidemics; riots; interruptions, loss or
malfunctions of utilities; computer (hardware or software) or
communications services; accidents; labor disputes; acts of
civil or military authority or governmental actions; it being
understood that the Plan Administrator shall use reasonable
efforts which are consistent with accepted practices in the
banking industry to resume performance as soon as practicable
under the circumstances.
The Plan Administrator is authorized to choose a broker/ dealer,
including an affiliated broker/ dealer, at its sole discretion
to facilitate purchases and sales of common stock by Plan
participants. The Plan Administrator will furnish the name of
the registered broker/ dealer, including any affiliated
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broker/ dealer, utilized in share transactions within a
reasonable time upon written request from the participant.
Changes to the Plan
RadioShack reserves the right to amend, modify, suspend or
terminate the Plan, or any provision thereof, from time to time,
but this action will have no retroactive effect that would
prejudice the interest of participants.
Governing Law
The terms and conditions of the Plan and its operation are
governed by the laws of the State of Texas.
DIRECT REGISTRATION
RadioShack is a participant in the Direct Registration System
(DRS). DRS is a method of recording shares of stock in
book-entry form. Book-entry means that your shares are
registered in your name on the books of RadioShack without the
need for physical certificates and are held separately from any
Plan shares you may own. Shares held in book-entry have all the
traditional rights and privileges as shares held in certificate
form. With DRS you can:
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Eliminate the risk and cost of storing certificates in a secure
place. |
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Eliminate the cost associated with replacing lost, stolen, or
destroyed certificates. |
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Move shares electronically to your broker. |
All share transactions are issued to book-entry (DRS) form,
rather than physical certificates. You may convert any stock
certificate(s) you are currently holding into book-entry form by
sending the stock certificate(s) to the Plan Administrator with
a request to deposit them to your DRS account. There is no cost
to you for this custodial service and by doing so you will be
relieved of the responsibility for loss or theft of your
certificate(s). Your certificate(s) should not be endorsed, and
we recommend sending your certificate(s) registered insured mail
for at least 3% of the current market value.
You may choose to have a portion or all of your full book-entry
or Plan shares delivered directly to your broker by contacting
your broker/ dealer. When using your broker to facilitate a
share movement, please provide them with a copy of your DRS
account statement.
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USE OF PROCEEDS
It is RadioShacks present intention that all purchases of
common stock made under the Plan will be in open market
transactions, and no proceeds are expected to flow to RadioShack
as a result of the offering. The principal purpose for the Plan
is to provide investors a convenient method for purchasing
shares of common stock and to provide stockholders with a
convenient method of investing cash dividends in additional
shares of common stock.
LEGAL MATTERS
Certain legal matters related to the common stock offered hereby
will be passed upon for RadioShack by David S.
Goldberg, Esq., Senior Vice President General
Counsel and Corporate Secretary for RadioShack.
Mr. Goldberg owns shares of common stock of RadioShack.
WHERE YOU CAN FIND MORE INFORMATION
We are subject to the reporting requirements of the Securities
Exchange Act of 1934, as amended (the Exchange Act),
and its rules and regulations. The Exchange Act requires us to
file reports, proxy statements and other information with the
SEC. Copies of these reports, proxy statements and other
information can be read and copied at:
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SEC Public Reference Room |
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100 F Street, N.E. |
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Room 1580 |
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Washington, DC 20549 |
You may obtain information on the operation of the Public
Reference Room by calling the SEC at
1-800-SEC-0330. You may
also obtain these materials electronically by accessing the
SECs home page on the Internet at:
This Prospectus does not have all of the information contained
in our registration statement on
Form S-3 and
attached exhibits, which we filed with the SEC under the
Securities Act of 1933, as amended, and to which we refer in
this Prospectus.
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We will promptly furnish, without charge, a copy of any and all
of the information that we have incorporated by reference in
this Prospectus upon your written or oral request to:
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Assistant Corporate Secretary |
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RadioShack Corporation |
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300 RadioShack Circle |
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MS CF4-101 |
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Fort Worth, Texas 76102 |
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(817) 415-3022 |
The following documents, which we previously filed with the SEC
pursuant to Section 13 or 15 of the Exchange Act, are
incorporated by reference into this Prospectus:
RadioShack Corporation SEC Filings (File No. 1-5571):
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Annual Report on
Form 10-K (filed
on March 15, 2006) for the twelve months ended
December 31, 2005, |
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Current Report on
Form 8-K (filed on
March 30, 2006), |
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Current Report on
Form 8-K (filed on
April 7, 2006), |
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Quarterly Report on
Form 10-Q (filed
on May 9, 2006) for the quarter ended March 31, 2006, |
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Current Report on
Form 8-K (filed on
May 23, 2006), and |
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Current Report on
Form 8-K (filed on
June 16, 2006). |
In addition, we incorporate by reference in this Prospectus all
documents that we may file under Sections 13(a), 13(c), 14
or 15(d) of the Exchange Act after the date of this Prospectus
and before the filing of a post-effective amendment (which
indicates that all securities offered have been sold or which
deregisters all securities then remaining unsold). Those
documents are a part of this Prospectus from the date of its
filing and later information we file with the SEC will
automatically update and supersede this information.
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