SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
___________________________________
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
__________________________________
March 30, 1995
Date of Report (Date of earliest event reported)
TANDY CORPORATION
(Exact name of registrant as specified in charter)
Delaware 1-5571 75-1047710
(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification No.)
incorporation)
1800 Tandy Center, Fort Worth, Texas 76102
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code
(817) 390-3700
Index to Exhibits is on Page 5.
Page 1 of 18 pages
<PAGE>
Item 2. Acquisition or Disposition of Assets
On March 30, 1995 Tandy Credit Corporation ("Tandy
Credit"), a wholly owned subsidiary of Tandy Corporation (the
"Corporation"), and Tandy National Bank ("Tandy Bank") a
national credit card bank wholly owned by the Corporation,
completed the previously reported sale of the Radio Shack and
Tandy Name Brand Retail Group (McDuff, VideoConcepts and The
Edge in Electronics) private label credit card accounts and
accounts receivable to Hurley State Bank, a subsidiary of SPS
Transaction Services, Inc. ("SPS"), a majority-owned
subsidiary of Dean Witter, Discover & Co. The Corporation
received $343 million in cash as well as a $49 million
deferred payment amount to be paid through February 1996.
The Corporation will not recognize any material gain or loss
on the transaction.
As part of the sales transactions just completed, Tandy
Credit was merged into Hurley Receivables Corporation
("HRC"), a wholly owned subsidiary of SPS and no longer
exists. The merger was necessary in order to transfer an
asset securitization program and approximately $230 million
in customer receivables which backed the program. HRC
assumed the ongoing obligations of the Corporation and its
affiliates under the asset securitization program. Tandy
Credit has also filed Post Effective Amendment No. 2 to its
Registration Statement on Form S-3 regarding the termination
of the registration of all remaining unsold medium term notes
and also filed Form 15 to de-register Tandy Credit's Common
Stock and terminate its reporting obligations under
Section 12g-4(a)(1)(i) of the Securities Exchange Act of
1934.
Pro forma financial information is presented under
Item 7(b) below. The unaudited pro forma consolidated
statement of income reflects the historical accounts of the
Corporation adjusted to give pro forma effect to the sale of
the credit card portfolios as if the transaction had occurred
at the beginning of 1994. The unaudited pro forma
consolidated balance sheet reflects the historical accounts
of the Corporation on December 31, 1994 adjusted to give
effect to the sale of the portfolios as if the sale had
occurred on December 31, 1994. The pro forma financial
information provided also includes the results of the Tandy
Credit transaction reported in the Corporation's Form 8-K,
Item 5 disclosure dated December 30, 1994 and filed on
January 6, 1995 and the Corporation's Form 8-K, Item 2
disclosure dated January 18, 1995 and filed February 2, 1995.
The pro forma financial information presented is not
necessarily indicative of the results of operations that
would have occurred had the sale been effective at the
beginning of the period nor is it necessarily indicative of
the results of operations which can be expected for any
subsequent period. The pro forma adjustments are based upon
available information and certain assumptions that the
Corporation believes are reasonable under the circumstances.
The pro forma financial information should be read in
conjunction with the consolidated financial statements and
the notes thereto included in the Corporation's December 31,
1994 Annual Report on Form 10-K.
Page 2 of 18 pages
<PAGE>
Item 7. Financial Statements and Exhibits
Listed below are the financial statements, pro forma
financial information and exhibits, if any, filed as a part
of this Report:
(a) None
(b) Pro Forma Financial Information
1 Pro Forma Consolidated Statement of Income for the year
ended December 31, 1994
2 Pro Forma Consolidated balance sheet of the Corporation
as of December 31, 1994
3 Notes to Pro Forma Financial Statements
(c) Exhibits
1 Acquisition Agreement dated January 18, 1995 between
Tandy Credit Corporation, Tandy National Bank and
Hurley State Bank, without exhibits
2 Amendment No. 1 to Acquisition Agreement dated
January 18, 1995 between Tandy Credit Corporation, Tandy
National Bank and Hurley State Bank
3 Agreement and Plan of Merger dated March 30, 1995 by
and among, Tandy Corporation, Tandy Credit
Corporation, Hurley State Bank and Hurley Receivables
Corporation
Page 3 of 18 pages
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange
Act of 1934, the registrant has duly caused this report to be
signed on its behalf by the undersigned thereunto duly
authorized this 12th day of April, 1995.
TANDY CORPORATION
(Registrant)
Date April 12, 1995 By: /s/ DWAIN H. HUGHES
_____________________
Dwain H. Hughes
Senior Vice President
and Chief Financial Officer
Page 4 of 18 pages
<PAGE>
INDEX TO EXHIBITS
Sequential
Page
Exhibit Description of Exhibit Number
(a) None
(b) Pro Forma Financial Information
(b)1 Pro Forma Consolidated Statement of
Income for the year ended December 31, 1994 6
(b)2 Pro Forma Consolidated balance sheet of the
Corporation as of December 31, 1994 7
(b)3 Notes to Pro Forma Financial Statements 8
(c) Exhibits
(c)1 Acquisition Agreement dated January 18, 1995
between Tandy Credit Corporation, Tandy National
Bank and Hurley State Bank, without exhibits
(Filed as exhibit (c) 1 to Tandy's Current
Report on Form 8-K dated January 18, 1995, filed
on February 2, 1995 under Accession No.
0000096289-95-000008)
(c)2 Amendment No. 1 to Acquisition Agreement dated
January 18, 1995 between Tandy Credit
Corporation, Tandy National Bank and Hurley
State Bank 9
(c)3 Agreement and Plan of Merger dated March 30,
1995 by and among, Tandy Corporation, Tandy
Credit Corporation, Hurley State Bank and Hurley
Receivables Corporation 12
Page 5 of 18 pages
<PAGE>
<TABLE>
PRO FORMA CONSOLIDATED STATEMENT OF INCOME
For the year ended December 31, 1994
Tandy Corporation and Subsidiaries
(Unaudited)
<CAPTIONS>
(In thousands, Historical
except per share amounts) As Reported Adjustments Pro Forma
_______________________________________________________________________________________
<S> <C> <C> <C>
Net sales and operating revenues $ 4,943,679 $ -- $ 4,943,679
Cost of products sold 3,017,615 -- 3,017,615
___________ ___________ ___________
Gross profit 1,926,064 -- 1,926,064
___________ ___________ ___________
Expenses:
Selling, general and administrative 1,532,673 (53,776)(A) 1,478,897
Depreciation and amortization 84,782 (101)(A) 84,681
Interest income (78,612) 46,379 (B) (32,233)
Interest expense 30,047 (6,183)(C) 23,864
Provision for restructuring cost 89,071 -- 89,071
Gain from sale of credit accounts
and extended service contracts (91,437) 35,708 (D) (55,729)
___________ ___________ ___________
1,566,524 22,027 1,588,551
___________ ___________ ___________
Income before income taxes 359,540 (22,027) 337,513
Provision for income taxes (135,205) 8,282 (E) (126,923)
___________ ___________ ___________
Income from continuing operations 224,335 (13,745) 210,590
Preferred dividends 6,777 -- 6,777
___________ ___________ ___________
Income from continuing operations
available to common shareholders $ 217,558 $ (13,745) $ 203,813
=========== =========== ===========
Income from continuing operations
available per average common and
common equivalent share $ 2.91 $ 2.72
=========== ===========
Average common and common
equivalent shares outstanding 74,874 74,874
=========== ===========
See Notes to Pro Forma Consolidated Financial Statements.
</TABLE>
Page 6 of 18 pages
<PAGE>
<TABLE>
PRO FORMA CONSOLIDATED BALANCE SHEET
At December 31, 1994
Tandy Corporation and Subsidiaries
(Unaudited)
<CAPTIONS>
Historical
(In thousands) As Reported Adjustments Pro Forma
_______________________________________________________________________________________________________
<S> <C> <C> <C>
Assets
Current assets:
Cash and short-term investments $ 205,633 $ 398,477 (F) $ 604,110
Accounts and notes receivable, less
allowance for doubtful accounts 769,101 (408,302)(G) 360,799
Inventories, at lower of cost or market 1,504,324 -- 1,504,324
Other current assets 77,202 -- 77,202
__________ __________ __________
Total current assets 2,556,260 (9,825) 2,546,435
Property, plant and equipment, at cost,
less accumulated depreciation 504,587 -- 504,587
Other assets, net of accumulated
amortization 182,927 (10,925)(G) 172,002
__________ __________ __________
$3,243,774 $ (20,750) $3,223,024
========== ========== ==========
Liabilities and Stockholders' Equity
Current liabilities:
Short-term debt, including current
maturities of long-term debt $ 229,135 $ (6,000)(H) $ 223,135
Accounts payable 582,194 -- 582,194
Accrued expenses 376,795 -- 376,795
Income taxes payable 18,026 -- 18,026
__________ __________ __________
Total current liabilities 1,206,150 (6,000) 1,200,150
__________ __________ __________
Long-term debt and capital leases,
excluding current maturities 153,318 -- 153,318
Other non-current liabilities 34,095 (14,750)(G) 19,345
__________ __________ __________
Total other liabilities 187,413 (14,750) 172,663
__________ __________ __________
Stockholders' Equity:
Preferred stock 529,982 -- 529,982
Common stock 85,645 -- 85,645
Additional paid-in-capital 93,357 -- 93,357
Retained earnings 2,176,971 -- 2,176,971
Foreign currency translation effects (1,799) -- (1,799)
Common stock in treasury, at cost (971,611) -- (971,611)
Unearned deferred compensation (62,334) -- (62,334)
__________ __________ __________
Total stockholders' equity 1,850,211 -- 1,850,211
__________ __________ __________
$3,243,774 $ (20,750) $3,223,024
========== ========== ==========
See Notes to Pro Forma Consolidated Financial Statements.
</TABLE>
Page 7 of 18 pages
<PAGE>
Notes to Pro Forma Consolidated Financial Statements
(A) To eliminate operating costs associated with Tandy
Credit Corporation and to adjust insurance income to the
amounts which would have been realized under the newly
enacted merchant services agreements.
(B) To eliminate interest income realized on the Radio Shack
and Tandy Name Brand Retail Group private label credit card
portfolios, the sale of which was completed March 30,
1995, and the Computer City and Incredible Universe private
label credit card portfolios, the sale of which was completed
December 30, 1994 (collectively the "Portfolios").
(C) To eliminate interest expense incurred in relation to
Tandy Credit Corporation's medium-term notes and other
short-term borrowings of Tandy Corporation assumed retired
with proceeds from the sale of the Portfolios.
(D) To eliminate gain recognized on the sale of the
Portfolios.
(E) To record the income tax effect of the pro forma
adjustments to the Consolidated Statements of Income.
(F) To record cash received from the sale of the Portfolios
and related assets based on December 31, 1994 book values,
net of cash assumed used to retire Tandy Credit
Corporation's medium-term notes payable (see Note (H) below).
(G) To remove net assets sold based on December 31, 1994
book values. The pro forma reduction of accounts and notes
receivable is net of the deferred payment amount that would
have been applicable at December 31, 1994.
(H) To remove Tandy Credit Corporation's medium-term
notes payable assumed retired with proceeds from the sale of
the Portfolios.
Page 8 of 18 pages
<PAGE>
EXHIBIT c(2)
AMENDMENT NO. 1 TO ACQUISITION AGREEMENT dated as of
March 30, 1995 (this "Amendment") among Tandy Credit
Corporation, a Delaware corporation ("TCC"), Tandy
National Bank, a national banking association organized under
the laws of the United States ("TNB") and Hurley State Bank,
a South Dakota banking corporation ("HSB"). Capitalized
terms used herein and not otherwise defined are used herein
as defined in the ACQUISITION AGREEMENT dated as of
January 18, 1995 (the "Acquisition Agreement") among TCC, TNB
and HSB.
WHEREAS, the parties desire to amend the Acquisition
Agreement as hereinafter provided;
NOW, THEREFORE, in consideration of the mutual agreements
herein contained, each party agrees as follows for the
benefit of the other parties:
ARTICLE I. AMENDMENTS AND MODIFICATIONS. The Acquisition
Agreement is amended and modified as of the date hereof as
set forth below:
Section 1.1 Definition of "Assumption Agreements". Clause
(ii) of the definition of Assumption Agreements is hereby
amended by replacing the term "TRC" in the fourth line
of the definition with "TCC".
Section 1.2 Definition of "Ineligible Account". Paragraph
(a) of the definition of Ineligible Account is hereby amended
by replacing the word "neither" in the third line thereof
with the word "either".
Section 1.3 Definition of "Merger Agreement". The
definition of Merger Agreement is hereby amended by replacing
the words "of even date herewith" with "dated March 30,
1995".
Section 1.4 Definition of "Merger Assets". Paragraph (ii)
of the definition of Merger Assets is hereby amended and
restated in its entirety as follows:
"(ii) All other assets of TCC set forth on Exhibit 3."
Section 1.5 Amendment to Section 3.2. Clause (D) of
Section 3.2 is hereby amended by replacing the phrase "8.25%
Class A Asset Backed Certificates" with "Series A Asset
Backed Certificates".
Section 1.6 New Section 9.22. Section 9 is hereby amended
by adding at the end thereof a new Section 9.22 as follows:
Page 9 of 18 pages
<PAGE>
"9.22 Securities Law Compliance
TCC has made available to Purchaser true and correct
copies of all reports and registration statements filed by it
or TRC with the Securities and Exchange Commission ("SEC")
since July 7, 1987. Each report or statement filed with the
SEC pursuant to the Securities Exchange Act of 1934, as
amended (the "1934 Act"), as of the date thereof, complied as
to form in all material respects with the 1934 Act and
applicable regulations thereunder, and did not contain any
untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to
make the statements therein, in light of the circumstances in
which they were made, not misleading and not in violation of
the 34 Act. Each such registration statement (as amended or
supplemented, as applicable) filed with the SEC pursuant to
the Securities Act of 1933 ("1933 Act"), as of the effective
date thereof, complied as to form in all material respects
with the 1933 Act and applicable regulations thereunder, and
did not contain any untrue statements of a material fact or
omit to state a material fact required to be stated therein
or necessary to make the statements contained therein, in
light of the circumstances in which they were made, not
misleading. Each of TCC and TRC has filed with the SEC on a
timely basis all reports required to be filed by it.
Section 1.7 Amendment of Section 11.13. Section 11.13 is
hereby amended by replacing "Class 8" in the second line
thereof with "Class B".
Section 1.8 Amendment of Section 14. Section 14 is hereby
amended by replacing in the third line of the last paragraph
thereof "(v)" with "(iv)".
Section 1.9 Addition of Section 17.10. The Agreement is
hereby amended by adding a new Section 17.10 which shall read
in its entirety as follows:
"17.10 Covenant of Purchaser
The Purchaser agrees that reasonably promptly after
payment in full of the Series A Asset Backed Certificates the
Tandy Master Trust will be terminated and TRC will be
dissolved."
ARTICLE II. MISCELLANEOUS.
Section 2.1 Governing Law. THIS AGREEMENT SHALL BE
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
DELAWARE WITHOUT REFERENCE TO ITS CONFLICTS OF LAW
PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE
PARTIES HEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH SUCH
LAWS.
Section 2.2 Counterparts. This Agreement may be executed
in two or more counterparts (and by different parties in
separate counterparts), each of which shall be an original,
but all of which together shall constitute one and the same
instrument.
Page 10 of 18 pages
<PAGE>
Section 2.3 Headings. The headings herein are for purpose
of reference only and shall not otherwise affect the meaning
or interpretation of any provision hereof.
Section 2.4 Effectiveness. This Agreement shall become
effective as of the day and year first above written.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed by their respective officers
thereunto duly authorized as of the date first above
written.
TANDY CREDIT CORPORATION
By /s/ Ronald L. Parrish
_______________________
Name:Ronald L. Parrish
Title: Vice President
TANDY NATIONAL BANK
By /s/ Ronald L. Parrish
________________________
Name: Ronald L. Parrish
Title: President and Chief
Executive Officer
HURLEY STATE BANK
By /s/ Richard F. Atkinson
_________________________
Name: Richard F. Atkinson
Title: Senior Vice President
Page 11 of 18 pages
<PAGE>
EXHIBIT c(3)
AGREEMENT AND PLAN OF MERGER
THIS AGREEMENT AND PLAN OF MERGER (the "Merger Agreement")
is made and entered into as of March 30, 1995, by and among
TANDY CORPORATION, a Delaware corporation ("TANDY"), TANDY
CREDIT CORPORATION, a Delaware corporation and wholly-owned
subsidiary of Tandy ("TCC"), HURLEY STATE BANK, a South
Dakota bank located in Sioux Falls, South Dakota ("Hurley"),
and HURLEY RECEIVABLES CORPORATION, a Delaware corporation
and wholly-owned subsidiary of Hurley ("HRC").
WHEREAS, TCC is a corporation duly organized and existing
under the laws of the State of Delaware with authorized
capital stock of 1,000 shares of Common Stock, par value
$10.00 per share (the "TCC Stock"), all of which shares are
issued and outstanding and owned of record by Tandy.
WHEREAS, HRC is a corporation duly organized and existing
under the laws of the State of Delaware and is authorized to
issue 1,000 shares of Common Stock, $.01 par value per share
(the "HRC Stock"), all of which shares are issued and
outstanding and owned of record by Hurley.
WHEREAS, the Boards of Directors of each of the parties
hereto desire to effect a merger (the "Merger") of TCC with
and into HRC on the terms and subject to the conditions
contained in this Merger Agreement and in accordance with the
General Corporation Law of the State of Delaware (the
"Delaware Law"). Accordingly, the respective Boards of
Directors of TCC and HRC have adopted resolutions approving
this Merger Agreement and directing the submission hereof to
the stockholders for approval.
WHEREAS, the sole stockholders of TCC and HRC, through
written consent in accordance with Section 228 of the
Delaware Law, each have adopted this Merger Agreement
and approved the Merger as provided herein and in accordance
with the Delaware Law.
NOW, THEREFORE, to effect the Merger and in consideration
of the premises and of the mutual covenants and agreements
contained herein, the parties do hereby agree as follows:
1. Definitions. Unless otherwise defined herein, for
purposes of this Merger Agreement, all capitalized terms
shall have the meaning given to them in the Acquisition
Agreement (Phase II) dated as of January 18, 1995, by and
among TNB, TCC and Hurley (the "Acquisition Agreement").
2. The Merger.
2.1 Merger. At the Effective Time (as defined in
Section 2.2 below), TCC shall be merged with and into HRC
upon the terms and subject to the conditions hereinafter
set forth and as permitted by and in accordance with
Subchapter IX of Chapter I of the Delaware Law. Thereupon,
the separate corporate existence of TCC shall cease, and HRC,
as the surviving corporation in the Merger, shall continue to
exist under and be governed by the Delaware Law. HRC, as the
surviving corporation, is sometimes referred to hereinafter
as the "Surviving Corporation".
Page 12 of 18 pages
<PAGE>
2.2 Filing of Merger Agreement; Effective Time. Subject
to the terms and conditions contained herein, a Certificate
of Merger substantially in the form attached hereto as
Exhibit A (the "Certificate of Merger") shall be executed by
HRC and filed, or caused to be filed, by HRC in the office of
the Secretary of State of the State of Delaware concurrently
with the Closing. The time of such filing is referred to
herein as the "Effective Time".
2.3 Conversion and Cancellation of Shares. At the
Effective Time, the shares of TCC Stock held by Tandy, by
virtue of the Merger, automatically and without any action on
the part of HRC, TCC or Tandy, shall be converted into the
right to receive payment pursuant to the Acquisition
Agreement and the Tandy Assignment Agreement. Upon and after
the Effective Time, Tandy shall be entitled, upon surrender
to Hurley of the certificate(s) (the "Tandy Certificate")
representing all issued and outstanding shares of TCC Stock
held of record by Tandy immediately prior to the Effective
Time, to receive payment as aforesaid. Until so surrendered,
the Tandy Certificate shall upon and after the Effective Time
be deemed for all purposes to represent and evidence only the
right to receive payment as aforesaid. At and after the
Effective Time, no transfer of TCC Stock issued and
outstanding prior to the Effective Time shall be made on the
stock transfer books of the Surviving Corporation.
2.4 Certificate of Incorporation; Bylaws; Directors;
Officers; Policies.
(a) The Certificate of Incorporation of the Surviving
Corporation shall be the Certificate of Incorporation of HRC
in effect at the Effective Time, as amended by the
Certificate of Merger.
(b) The Bylaws of the Surviving Corporation shall be the
Bylaws of HRC as in effect at the Effective Time.
(c) From and after the Effective Time, the members of the
Board of Directors of the Surviving Corporation shall consist
of the members of the Board of Directors of HRC at the
Effective Time, each to serve until the expiration of the
term for which such director was elected and until his or her
successor is elected or appointed and qualified or until his
or her earlier death, resignation or removal.
(d) From and after the Effective Time, the officers of the
Surviving Corporation shall consist of the officers of HRC at
the Effective Time, each to serve until his or her successor
is elected or appointed and qualified or until his or her
earlier death, resignation or removal.
(e) Until thereafter changed in accordance with law or the
Certificate of Incorporation or Bylaws of the Surviving
Corporation, all corporate acts, plans, policies, contracts,
approvals and authorizations of TCC and its stockholder,
Board of Directors, committees elected or appointed thereby,
officers and agents, which were valid and effective
immediately prior to the Effective Time, shall be taken for
all purposes as the acts, plans, policies, contracts,
approvals and authorizations of the Surviving Corporation and
shall be effective and binding thereon as the same were with
respect to TCC.
2.5 Rights and Duties of HRC and the Surviving
Corporation. (a) At the Effective Time, the corporate
existence of TCC shall be merged into and continued in the
Surviving Corporation; and the Surviving Corporation shall be
deemed a continuation in entity and identity of TCC and HRC
(the "Constituent Corporations"). All rights, franchises and
Page 13 of 18
<PAGE>
interests of the Constituent Corporations, in and to every
type of property (real, personal, and mixed) and choses in
action shall be transferred to and vested in the Surviving
Corporation without any deed or other transfer, and the
Surviving Corporation, without any order or action on the
part of any court or otherwise, shall hold and enjoy all
rights and property, franchises and interests, in the same
manner and to the same extent as such rights, franchises and
interests were held or enjoyed by the respective Constituent
Corporations immediately prior to the Effective Time.
(b) At the Effective Time, the Surviving Corporation shall
be liable for all liabilities of the Constituent
Corporations, and all deposits, debts, liabilities,
obligations and contracts of the Constituent Corporations,
matured or unmatured, whether accrued, absolute, contingent
or otherwise, whether or not reflected or reserved against on
balance sheets, books of account or records of either of the
Constituent Corporations shall be those of the Surviving
Corporation and shall not be released or impaired; and all
rights of creditors and other obligees and all liens on
property of either of the Constituent Corporations shall be
preserved unimpaired as rights and obligations of and liens
on the property of the Surviving Corporation.
3. Warranties and Representations of Tandy. Tandy
represents and warrants to Hurley and HRC as follows:
3.1 Organization. Tandy is a corporation duly organized
and validly existing under the Delaware Law.
3.2 Authority. Tandy has the corporate power and
authority to enter into and perform this Merger Agreement and
to effect the transactions contemplated hereby. The
execution, delivery and performance of this Merger Agreement
has been approved by all requisite corporate actions on the
part of Tandy.
3.3 Binding Obligation. Assuming that this Merger
Agreement has been duly authorized, executed and delivered
by, and constitutes an enforceable obligation of Hurley
and HRC, this Merger Agreement constitutes a legal, valid and
binding obligation of Tandy enforceable in accordance with
its terms, except as enforceability may be limited by
bankruptcy, insolvency, reorganization, moratorium,
receivership, conservatorship or other similar laws or
judicial decisions affecting the enforcement of creditors'
rights generally and by general principles of equity,
regardless of whether such enforceability is considered in a
proceeding in equity or at law.
3.4 Legal Proceedings. There are no actions, suits or
proceedings, including but not limited to regulatory
proceedings or inquiries, which are pending, or to the
knowledge of Tandy, threatened against or affecting Tandy
that would have a material adverse effect on the Merger as
contemplated by this Merger Agreement.
3.5 Governmental Notices; Regulatory Approvals. Tandy has
not received notice from any federal or state governmental
agency indicating that it would oppose or not grant or issue
its consent or approval, if required, with respect the
Merger.
3.6 Finders or Brokers. Tandy has not agreed to pay any
fee or commission to any agent, broker, finder or other
person for or on account of services rendered as a broker or
finder in connection with this Merger Agreement or the
transactions contemplated hereby.
Page 14 of 18 pages
<PAGE>
3.7 Compliance with Law and Other Instruments. The
execution, delivery and performance by Tandy of this Merger
Agreement will not violate either Tandy's charter or bylaws
or any material contract or other instrument to which Tandy
is a party or by which Tandy is bound in any manner which
would have a material adverse effect on the Merger.
4. Conditions Precedent to the Obligations of Hurley and
HRC. The obligations of Hurley and HRC to consummate the
Merger are subject to the occurrence of the Closing under the
Acquisition Agreement at or prior to the Effective Time and
the fulfillment (except to the extent, if any, waived by
Hurley or HRC) of the following conditions at or prior to the
Effective Time:
4.1 Truth of Representation. The representations and
warranties of Tandy set forth in Section 3 hereof shall be
true and correct in all material respects.
4.2 Performance of Obligations. The obligations and
agreements of Tandy and TCC set forth in this Merger
Agreement and to be performed on or before the Effective Time
shall have been performed in all material respects.
5. Conditions Precedent to the Obligations of Tandy and
TCC. The obligations of Tandy and TCC to consummate the
Merger are subject to the occurrence of the Closing under
the Acquisition Agreement at or prior to the Effective Time
and the performance in all material respects of the
obligations and agreements of Hurley and HRC set forth in
this Merger Agreement and to be performed on or before the
Effective Time (except to the extent, if any, waived by Tandy
or TCC).
6. Indemnification.
6.1 (a) Tandy hereby agrees to indemnify Hurley and hold
Hurley harmless from any liability, loss, cost or expense,
including reasonable outside attorneys' fees, to the extent
it is caused by or results from (i) the breach by Tandy of
Tandy's representations or warranties contained in this
Merger Agreement; or (ii) the breach by Tandy of any of its
obligations or agreements herein contained.
(b) HRC hereby agrees to indemnify Tandy and hold Tandy
harmless from any liability, loss, cost or expense, including
reasonable outside attorneys' fees, to the extent it is
caused by or results from the breach by HRC of any of its
obligations or agreements herein contained.
6.2 In case any claim is made, or any suit or action is
commenced, against one party ("Indemnitee") by the other
party ("Indemnitor") in respect of which indemnification is
sought by the Indemnitee under this Section 6, the Indemnitee
shall promptly give the Indemnitor notice thereof and the
Indemnitor shall be entitled to participate in (or, if the
Indemnitee does not desire to defend, to conduct) the defense
thereof at the Indemnitor's expense. The Indemnitor may (but
need not) defend or participate in the defense of any such
claim, suit or action, but the Indemnitor shall promptly
notify the Indemnitee if the Indemnitor shall not desire to
defend or participate in the defense of any such claim, suit
or action or if the Indemnitor disputes liability for
indemnity under this Section 6. Thereafter the Indemnitee
shall defend and so long as the Indemnitor has not undertaken
the defense or is not participating in the defense, the
Indemnitee may at any time notify the Indemnitor of its
intention to settle or compromise any claim, suit or action
against the Indemnitee in respect of which payments may be
sought by the Indemnitee hereunder, and the Indemnitee may
settle or compromise any such claim, suit or action unless
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<PAGE>
the Indemnitor notifies the Indemnitee in writing (within ten
(10) days after the Indemnitee has given written notice of
its intention to settle or compromise) the Indemnitor intends
to conduct the defense of such claim, suit or action. Any
such permitted settlement or compromise by the Indemnitee of,
or any final judgment or decree entered on or in, any claim,
suit or action which the Indemnitee has defended and of which
the Indemnitor has not elected to participate in the defense
of in accordance herewith, shall be deemed to have been
consented to by, and shall be binding upon, the Indemnitor as
fully as if the Indemnitor had assumed the defense thereof
and a final judgment or decree had been entered in such suit
or action, or with regard to such claim, by a court of
competent jurisdiction for the amount of such settlement,
compromise, judgment or decree. In all other cases in which
the Indemnitor is participating in the defense with the
Indemnitee, the Indemnitee shall not settle or compromise any
claim or action without the Indemnitor's prior written
consent, which shall not be unreasonably withheld.
7. Termination of Merger Agreement. This Merger Agreement
and the Merger shall be terminated automatically and shall be
of no further force or effect upon termination of the
Acquisition Agreement.
8. Survival of Representations Warranties and Agreements.
Notwithstanding any investigation made by or on behalf of any
party hereto at any time, the warranties, representations and
indemnities set forth in Sections 3 and 6 of this Merger
Agreement shall survive the Effective Time and be deemed to
have been relied upon in connection with the consummation of
the Merger by the party or parties to whom they were made,
even if such relying party knew of any breach of such
warranties or representations, unless such party failed to
disclose such knowledge to all other parties prior to the
Effective Time.
9. Miscellaneous.
9.1 Expenses. Except as is otherwise specifically
provided in this Merger Agreement, each party shall pay its
own costs and expenses in connection with this Merger
Agreement and the Merger, including, but not by way of
limitation, all regulatory fees, attorneys' fees, accounting
fees and other expenses.
9.2 Notices. All notices, demands and other
communications hereunder shall be governed by the notice
provisions in Section 16.2 of the Acquisition Agreement.
9.3 Successors and Assigns. All terms and provisions of
this Merger Agreement (including, but not limited to,
independent provisions) shall be binding upon and shall inure
to the benefit of the parties hereto and their respective
permitted transferees, successors and assigns; provided,
however, that this Merger Agreement and all rights,
privileges, duties and obligations of the parties hereto may
not be assigned or delegated by any party without the written
consent of the other party, which consent shall not be
unreasonably withheld.
9.4 Counterparts. This Merger Agreement may be executed
in one or more counterparts, all of which taken together
shall constitute one instrument.
9.5 Governing Law. The laws of the State of Delaware
applicable to contracts executed and wholly performed therein
shall govern the validity and interpretation hereof and the
Page 16 of 18 pages
<PAGE>
performance of the parties hereto of their respective duties
and obligations hereunder.
9.6 Captions. The captions contained in this Merger
Agreement are for convenience of reference only and do not
form a part of this Merger Agreement.
9.7 Entire Agreement. The making, execution and delivery
of this Merger Agreement by the parties hereto have been
induced by no representations, statements, warranties or
agreements other than those expressed herein and in the
Acquisition Agreement. This Merger Agreement, the
Acquisition Agreement and the other written agreements
specifically referred to herein and therein embody the entire
understanding of the parties and there are no further or
other agreements or understandings, written or oral, in
effect between the parties relating to the subject matter
hereof. Except as provided herein, this Merger Agreement is
not conditioned on the entry or execution of any other,
future agreement. This instrument and the agreements
contained herein may be amended or modified only by a written
instrument signed by both parties or their duly authorized
agents.
9.8 No Waiver of Rights. No party, by virtue of this
Merger Agreement, waives any rights it may have to recover
damages or to seek other relief against any Person, including
any party to this Merger Agreement, arising out of acts or
omissions of such Person. No such waiver is intended and
none shall be deemed or implied.
9.9 No Consequential Damages. None of the parties to this
Merger Agreement shall be liable one to the other for any
indirect, incidental, or consequential damages as a result of
any breach of any agreement, warranty, representation or
obligation under this Merger Agreement.
[Signature page follows.]
Page 17 of 18 pages
<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed and
delivered this Merger Agreement as of the day and year first
above written.
TANDY CORPORATION
By: /s/ Dwain H. Hughes
____________________________
Dwain H. Hughes
Its: Senior Vice President
and Chief Financial Officer
TANDY CREDIT CORPORATION
By: /s/ Ronald L. Parrish
_____________________________
Ronald L. Parrish
Its: Vice President
HURLEY STATE BANK
By: /s/ Robert L. Wieseneck
_____________________________
Robert L. Wieseneck
Its: President
HURLEY RECEIVABLES CORPORATION
By: /s/ Russel Bonaguidi
_____________________________
Russel Bonaguidi
Its: President
Page 18 of 18 pages
