RadioShack Received Second Notice of Default $RSH

As previously disclosed on Form 8-K filed on December 2, 2014, on December 1, 2014, RadioShack Corporation (the “Company”) received a notice of default and acceleration (the “First Notice of Default”) from the SCP Agent (defined below) asserting that certain events of default had occurred and were continuing under the Credit Agreement, dated as of December 10, 2013 (the “SCP Credit Agreement”), among the Company, certain subsidiaries of the Company that are designated as credit parties, the lenders party thereto (the “SCP Lenders”) and Salus Capital Partners, LLC, as agent for the SCP Lenders (in such capacity, the “SCP Agent”). In addition to asserting events of default, the First Notice of Default also included a demand by the SCP Agent for the immediate payment in full by the Company of the $250 million term loan outstanding under the SCP Credit Agreement, together with all accrued and unpaid interest thereon (all of which interest that was due on December 1, 2014 having been paid in full on that date) and any other amounts owing to the SCP Lenders thereunder.

As noted in the First Notice of Default, on December 1, 2014, the SCP Agent sent a notice to the depositary bank at which the Company maintains a deposit account into which proceeds of certain residual accounts are to be deposited (the “Residual Account Deposit Account”), instructing the depositary bank to prevent the Company from withdrawing funds on deposit in the Residual Account Deposit Account and directing the depositary bank to transfer all funds at any time on deposit in the Residual Account Deposit Account to the SCP Agent.

On January 27, 2015, the Company received a notice of default (the “Second Notice of Default”) from the SCP Agent asserting that an event of default has occurred and is continuing under the SCP Credit Agreement because the Company has not deposited all proceeds that it has received from the applicable residual accounts into the Residual Account Deposit Account.

The SCP Agent alleges in the Second Notice of Default that the foregoing matters constitute continuing events of default under the SCP Credit Agreement.

If it is determined that an event of default has occurred and is continuing under the SCP Credit Agreement, such event of default would also constitute an event of default under the Credit Agreement dated as of December 10, 2013, as amended by the First Amendment dated as of October 3, 2014 (the “ABL Credit Agreement”), with the lenders party thereto and Cantor Fitzgerald Securities as administrative agent. If the maturity of the obligations outstanding under the SCP Credit Agreement is validly accelerated, then an event of default would occur under the Indenture, dated as of May 3, 2011, by and among the Company, the Guarantors named therein, and Wells Fargo Bank, National Association, as Trustee, which governs our $325 million of 6.75% Senior Notes. The occurrence of any such events of default under these other debt arrangements would permit the lenders thereunder (or the agent or trustee acting on their behalf) to declare all amounts outstanding thereunder to become immediately due and payable and to exercise other remedies set forth in the applicable debt documents.