FORM 11-K
[ X ] ANNUAL REPORT PURSUANT TO
SECTION 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 (FEE REQUIRED)
For the Fiscal Year Ended June 30, 1996
OR
[ ] TRANSITION REPORT PURSUANT TO
SECTION 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 (NO FEE REQUIRED)
For the Transition Period from to
Commission File Number 1-5571
TANDY EMPLOYEES INVESTMENT PLAN
(full title of plan)
Tandy Corporation
1800 One Tandy Center
Fort Worth, TX 76102
(Name of issuer and address of principal executive office)
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TANDY EMPLOYEES INVESTMENT PLAN
FORT WORTH, TEXAS
REPORT OF EXAMINATION
JUNE 30, 1996
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C O N T E N T S
Page
CERTIFIED PUBLIC ACCOUNTANT'S REPORT . . . .. 4
STATEMENT OF FINANCIAL CONDITION . . . . . .. 5
STATEMENT OF INCOME AND CHANGES IN PLAN EQUITY . . 6
NOTES TO FINANCIAL STATEMENTS . . . . . . . . 7-19
ADDITIONAL INFORMATION . . . . . . . . . . . . 20-22
SIGNATURE PAGE . . . . . . . . . . . . .. . . 23
INDEX TO EXHIBITS . . . . . . . . . . . . . . 24
CONSENT OF INDEPENDENT ACCOUNTANT . . . . . . 25
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The Administrative Committee and Participants of
Tandy Employees Investment Plan
Fort Worth, Texas
INDEPENDENT AUDITOR'S REPORT
I have audited the accompanying statement of financial condition of the Tandy
Employees Investment Plan as of June 30, 1996 and 1995, and the related
statement of income and changes in the plan equity for the years ended June 30,
1996, 1995 and 1994. These financial statements are the responsibility of the
Plan's management. My responsibility is to express an opinion on these financial
statements based on my audit.
I conducted my audit in accordance with generally accepted auditing standards.
Those standards require that I plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
I believe that my audit provides a reasonable basis for my opinion.
In my opinion, the financial statements referred to above present fairly, in all
material respects, the financial status of the Tandy Employees Investment Plan
as of June 30, 1996 and 1995, and results of its changes therein for the years
ended June 30, 1996, 1995 and 1994, in conformity with generally accepted
accounting principles.
My audit was made for the purpose of forming an opinion on the basic financial
statements taken as a whole. The supplemental schedules of assets held for
investment purposes and of non-exempt transactions are presented for the purpose
of additional analysis and are not a required part of the basic financial
statements but are supplementary information required by the Department of
Labor's Rules and Regulations for Reporting and Disclosure under the Employee
Retirement Income Security Act of 1974. The supplemental schedules have been
subjected to the auditing procedures applied in the audit of the basic financial
statements and, in my opinion, are fairly stated in all material respects in
relation to the basic financial statements taken as a whole.
/s/ CURTIS B. MORRISON, C.P.A.
CURTIS B. MORRISON, CPA
Fort Worth, Texas
September 10, 1996
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TANDY EMPLOYEES INVESTMENT PLAN
FORT WORTH, TEXAS
STATEMENT OF FINANCIAL CONDITION
JUNE 30, 1996 AND 1995
PLAN ASSETS
-----------
1996 1995
-------------- ---------------
Investment in Securities of
Participating Employer (Note B):
Common Stock (Cost $814,753.87
in 1996 and $1,094,454.41 in 1995) $15,724,804.75 $23,129,454.38
-------------- --------------
Investments in Securities of
Unaffiliated Issuers (Note B):
Other Securities - Short Term
Money Market Fund(Cost $220,794.49
in 1996 and $2,462.36 in 1995) $ 220,794.49 $ 2,462.36
-------------- --------------
Accrued Receivables:
Interest $ 865.92 $ 12.02
Proceeds Due from Stock Trade 41,269.00 0
-------------- --------------
$ 42,134.92 $ 12.02
-------------- --------------
Plan Assets:
Tandy Employees Investment Plan
(Special Account) (Note F) $ 367,071.61 $ 385,228.91
-------------- --------------
$16,354,805.77 $23,517,157.67
============== ===============
LIABILITIES AND PLAN EQUITY
---------------------------
Liabilities:
Due to Former Plan Participants $ 262,131.54 $ 0
Plan Equity:
Participants' Interest in Tandy
Employees Investment Plan 15,725,602.62 23,131,928.76
Participants' Interest in Tandy
Employees Investment Plan (Special
Account) (Note F) 367,071.61 385,228.91
-------------- --------------
$16,354,805.77 $23,517,157.67
The accompanying notes are an integral part of these financial statements.
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TANDY EMPLOYEES INVESTMENT PLAN
FORT WORTH, TEXAS
STATEMENT OF INCOME AND CHANGES IN PLAN EQUITY
FOR THE YEARS ENDED JUNE 30, 1996, 1995 AND 1994
1996 1995 1994
-------------- -------------- ---------
Investment Income:
Interest-Other $ 26,833.12 $ 38,374.39 $ 33,451.69
Dividends-Employer 298,751.24 337,273.65 377,054.10
------------- -------------- --------------
$ 325,584.36 $ 375,648.04 $ 410,505.79
Less:Interest
Expense 0 0 0
-------------- -------------- --------------
$ 325,584.36 $ 375,648.04 $ 410,505.79
------------- -------------- --------------
Realized Gain (Loss) on
Securities (Note C):
Employer Securities $ 5,778,022.93 $ 4,434,164.41 $ 7,221,927.58
Other Securities 0 0 955,958.37
--------------- -------------- --------------
$ 5,778,022.93 $ 4,434,164.41 $ 8,177,885.95
-------------- -------------- --------------
Increase (Decrease) in
Unrealized Appreciation
of Investments(Note D) $(7,124,951.95) $ 4,725,677.37 $(4,446,785.66)
--------------- -------------- ---------------
Contributions(Note A) $ 0 $ 0 $ 0
-------------- --------------- --------------
Other Additions:
Appreciation in
Value over Cost
Distributed in
Withdrawals $ 164,028.29 $ 37,082.60 $ 25,025.96
-------------- -------------- --------------
TOTAL $ (857,316.37) $ 9,572,572.42 $ 4,166,632.04
Less:
Withdrawals of
Participants' Interest 6,549,009.77 5,438,921.28 8,277,702.70
-------------- -------------- --------------
Net Increase (Decrease)
in Plan for the Years
Ending 6-30-96/95/94 $(7,406,326.14) $ 4,133,651.14 $(4,111,070.66)
Plan Equity at Beginning
of Year 7-1-95/94/93 23,131,928.76 18,998,277.62 23,109,348.28
-------------- -------------- ---------------
Plan Equity at End of
Year 6-30-96/95/94 $ 15,725,602.62 $ 23,131,928.76 $ 18,998,277.62
=============== =============== ===============
The accompanying notes are an integral part of these financial statements.
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TANDY EMPLOYEES INVESTMENT PLAN
FORT WORTH, TEXAS
NOTES TO FINANCIAL STATEMENTS
FOR THE YEARS ENDED JUNE 30, 1996, 1995 AND 1994
NOTE A - DESCRIPTION OF THE PLAN
DESCRIPTION OF THE PLAN
- ------------------------
The following description of the Tandy Employees Investment Plan (the "Plan")
provides only general information. Participants should refer to the Plan
prospectus for a more complete description of the Plan's provisions.
General
- -------
Effective June 30, 1982, at the end of the Plan's fiscal year, the Tandy
Employees Investment Plan ceased accepting applications and contributions. All
employees eligible for participation in the Plan became eligible for
participation in the new Tandy Employees Deferred Salary and Investment Plan
which became effective July 1, 1982 (Reg. No. 33-39749). Also, see Note E.
Contributions
- -------------
Through June 30, 1982, Tandy Corporation made contributions to the Plan equal to
80% of the participating employees' qualifying contributions. The participating
employee contributed either 5% (qualifying contribution) or 10% (5% qualifying
and 5% voluntary contributions).
Participants' Accounts
- ----------------------
Participants' accounts are valued as of the last day of each March, June,
September and December. Each participant is mailed a quarterly statement showing
his contributions to date, Company contributions to date, total contributions to
date and the market value of his account. Each participant is also mailed a copy
of the Tandy Corporation annual report, and the summary annual report for the
Plan.
Vesting
- -------
The participants' accounts are fully vested at the end of each calendar quarter,
except for amounts credited to the account because of fraud or mistake of fact.
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TANDY EMPLOYEES INVESTMENT PLAN
FORT WORTH, TEXAS
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEARS ENDED JUNE 30, 1996, 1995 AND 1994
NOTE A - DESCRIPTION OF THE PLAN (continued)
Payments of Benefits
- --------------------
Payroll deductions made for a participant's Qualifying or Voluntary
Contributions to the Plan were a part of his current compensation and, as such,
were subject to withholding for federal income tax purposes.
A participant is not subject to federal income tax on Company contributions to
the Plan, or other accumulations, until he makes a withdrawal from the Plan. A
withdrawal is generally taxed only to the extent it exceeds the participant's
aggregate contributions.
The taxable portion of a "lump-sum distribution" and certain "partial
distributions" may not be subject to tax upon receipt by a participant if the
distribution is rolled over into an IRA or another qualified plan within the
prescribed time period. If a lump-sum distribution is not rolled over, a special
5-year averaging tax (intended to minimize the tax burden) may be available for
some participants with respect to the taxable portion of such distribution. As a
general rule, only one lump-sum distribution which is received after attaining
age 59-1/2 is eligible for the special 5-year averaging (computed under the tax
rates contained in the Tax Reform Act of 1986) or the 10-year averaging
(computed under prior law tax rates).
If a lump-sum distribution consists in part of securities of Tandy Corporation,
the portion of such distribution which represents net unrealized appreciation of
such securities will not be currently taxable to the recipient for federal
income tax purposes (although a participant may elect to include such
appreciation in income, if desired). Upon a subsequent disposition of such
securities, gain or loss will be determined generally by reference to their
basis when they were acquired by the Plan. An additional 10% income tax is
imposed on certain early distributions included in gross income prior to
attaining age 59-1/2, death or disability. The value of a participant's interest
in the Plan is includable in his gross estate upon his death.
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TANDY EMPLOYEES INVESTMENT PLAN
FORT WORTH, TEXAS
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEARS ENDED JUNE 30, 1996, 1995 AND 1994
NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Valuation of Securities
- -----------------------
All securities are valued at the closing price according to the respective stock
exchanges.
All other securities are valued at cost.
SCHEDULE OF INVESTMENTS IN SECURITIES OF
-----------------------------------------
PARTICIPATING EMPLOYER
----------------------
NO. OF VALUE
SHARES COST 6-30-96
------ ---- -------
COMMON STOCK
------------
Industrial
Tandy Corporation
Common Stock 331,922 $ 814,753.87 $15,724,804.75
============== ==============
SCHEDULE OF INVESTMENTS IN SECURITIES OF
----------------------------------------
UNAFFILIATED ISSUERS
--------------------
MARKETABLE SECURITIES
---------------------
VALUE
COST 6-30-96
------ -------
OTHER SECURITIES
----------------
Money Market Fund
Short-Term Money Market Fund $ 220,794.49 $ 220,794.49
============= ============
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TANDY EMPLOYEES INVESTMENT PLAN
FORT WORTH, TEXAS
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEARS ENDED JUNE 30, 1996, 1995 AND 1994
NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
Income Tax Status
- -----------------
The Plan is a qualified plan under Section 401 of the Internal Revenue Code and
is exempt from federal income taxes under Section 501.
NOTE C - REALIZED GAIN ON SECURITIES
The realized gain or loss from the sale of securities was as follows:
1996 1995 1994
------------ ----------- ----------
Participating Employer
Securities:
Sales Price $6,048,830.26 $4,666,225.00 $7,560,762.50
Less Cost(Average Cost) 270,807.33 232,060.59 338,834.92
-------------- --------------- --------------
Net Realized Gain $5,778,022.93 $4,434,164.41 $7,221,927.58
============= ============= ==============
Unaffiliated Issuers'
Securities:
Sales Price $ 0 $ 0 $1,004,497.35
Less Cost(Average Cost) 0 0 48,538.98
------------ --------------- -------------
Net Realized Gain $ 0 $ 0 $ 955,958.37
============= ============== =============
The realized gain or loss on the sale of securities for financial statement
reporting is prepared in conformity with generally accepted accounting
principles which differ from the principles for income tax reporting.
Generally accepted accounting principles measure gain or loss as the difference
between the securities' sale price and its average historical cost. The gain or
loss for income tax reporting is the difference between the securities' sale
price and its current value at the beginning of the plan year.
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TANDY EMPLOYEES INVESTMENT PLAN
FORT WORTH, TEXAS
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEARS ENDED JUNE 30, 1996, 1995 AND 1994
NOTE C - REALIZED GAIN ON SECURITIES (continued)
A participant's account is increased or decreased by the realized gain or loss
recognized under generally accepted accounting principles.
NOTE D - UNREALIZED APPRECIATION
The following reflects the increase (decrease) in unrealized appreciation:
1996 1995 1994
--------------- --------------- -------------
Unrealized
Appreciation
6-30-96/95/94 $14,910,050.88 $22,035,002.83 $17,309,325.46
Unrealized
Appreciation
7-1-95/94/93 22,035,002.83 17,309,325.46 21,756,111.12
-------------- -------------- --------------
Change in
Unrealized
Appreciation
6-30-96/95/94 $(7,124,951.95) $ 4,725,677.37 $(4,446,785.66)
=============== ============== ===============
The unrealized appreciation or depreciation of securities held for investment
for financial statement reporting is prepared in conformity with generally
accepted accounting principles which differ from the principles for income tax
reporting.
Generally accepted accounting principles measure unrealized appreciation or
depreciation as the difference between the securities' market value at the
Plan's year end and its historical cost. The unrealized appreciation or
depreciation for income tax reporting is the difference between the securities'
market value at the plan year end and its current value at the beginning of the
plan year.
A participant's account is increased or decreased by the unrealized appreciation
or depreciation recognized under generally accepted accounting principles.
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TANDY EMPLOYEES INVESTMENT PLAN
FORT WORTH, TEXAS
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEARS ENDED JUNE 30, 1996, 1995 AND 1994
NOTE E - TRANSFER FROM OTHER PLANS
The Tandy Employees Supplemental Investment Plan ("SIP") was amended effective
June 30, 1991 to terminate the SIP and consolidate the SIP's assets with the
Plan in compliance with Internal Revenue Code Section 414(1).
NOTE F - TANDY EMPLOYEES INVESTMENT PLAN (SPECIAL ACCOUNT)
These Plan assets were received in 1978 from the Tandycrafts Employees
Investment Plan, a Qualified Plan under Section 401 of the Internal Revenue
Code, on the transfer of certain employees and their investment accounts to
Tandy Corporation. These assets consisted of employer securities and conformed
to both Plan agreements. This Special Account was created in order to preserve
the participants' Tandycrafts Plan cost basis in the securities transferred for
income tax considerations on subsequent distributions. Attached as Exhibit A is
the report of examination for this Special Account.
NOTE G - RELATED PARTY TRANSACTIONS
During 1996, 1995 and 1994 common stock of Tandy Corporation was sold to the
Tandy Employees Deferred Salary and Investment Plan, now the Tandy Fund, at
its current market value on the transaction date in the amount of
$6,048,830.26, $4,666,225.00, and $7,560,762.50, respectively.
NOTE H - ADMINISTRATION OF PLAN ASSETS
The Plan's assets are held by the Trustee of the Plan.
The Trustee invests cash received from interest and dividend income and makes
distributions to the participants.
Certain administrative functions are performed by employees of the Company with
no compensation from the Plan. Administrative expenses and Trustee fees are paid
directly by the Company.
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TANDY CORPORATION INVESTMENT PLAN
FORT WORTH, TEXAS
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEARS ENDED JUNE 30, 1996, 1995 AND 1994
NOTE I - UNIT VALUE
Valuation
Quarter Ending Number of Units per Unit
-------------- --------------- ----------
June 30, 1995 34,716.0397 $666.3181
September 30, 1995 32,886.5149 782.2027
December 31, 1995 28,127.3193 535.2717
March 31, 1996 27,025.4751 599.1458
June 30, 1996 25,521.7301 616.1652
NOTE J - CHANGES TO PLAN
See the attached amendments made to the Plan.
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AMENDMENT XLIX
TO THE
FIFTH RESTATED TRUST AGREEMENT
TANDY EMPLOYEES INVESTMENT PLAN
This Amendment made on the 27th day of December, 1995 between Tandy Corporation,
a corporation duly organized and existing under the laws of the State of
Delaware, with its principal place of business at Fort Worth, Tarrant County,
Texas, hereinafter called "Company," and Bank One, Texas, NA hereinafter called
"Trustee;"
WHEREAS, on the 24th day of February, 1995, Company and Trustee entered into an
agreement named the Fifth Restated Trust Agreement Tandy Employees Investment
Plan (the "Plan"); and
WHEREAS, Company and Trustee desire to make certain amendments to the Plan.
NOW, THEREFORE, the parties hereby agree to amend the Plan as follows:
I
Section 6.03 is hereby amended by deleting same in its entirety and
substituting the following in lieu thereof:
6.03 Valuation of Participant's Account: In the event of retirement,
termination of employment, or withdrawal from the Plan, the value of a
Participant's account shall be the number of Units in the Participant's account
on the date determined in Section 6.04 or 6.05 below, valued at a price per Unit
which is based on the fair market value of the total assets in the trust fund as
of such date. The withdrawing Participant will be refunded any contribution
withheld from the Participant and paid into the trust fund during the calendar
quarter in which written notice or payroll termination date (as set out in
Section 6.04 or 6.05 below) becomes effective.
II
Section 6.04 is hereby amended by deleting same in its entirety and
substituting the following in lieu thereof:
6.04 Distribution Upon Withdrawal From the Plan During Employment: A
Participant may withdraw all or a portion of the value of his account by filing
a written notice with the Committee and Trustee. The effective date of such
written notice, and the date for valuation of the Trust's assets, shall be the
date the notice is received by the Committee or the date subsequent thereto if
the Participant so states in the written notice.
Such withdrawal shall be upon the following terms and conditions:
(a) If he so elects in his written notice, a Participant may withdraw
the full value of his account. In this event, however, he shall be deemed to
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have suspended participation in the Plan and all contributions to the Plan by or
on his behalf shall be suspended. If he elects to renew participation within the
24 month period from the date of withdrawal, he must repay (re-purchase units)
into the Plan the exact dollar amount of his withdrawal. Such repayments will be
deemed Voluntary contributions. Provided, however, such Participant may
re-participate after the 24 month period but he shall not repay the Plan the
amount of such withdrawal; or
(b) If he so elects in his written notice, a Participant may withdraw
one-fourth (1/4) of the value of all Units credited to his account, in which
event his participation in the Plan shall not terminate, but his contributions
and those of the Company based on and relating to his contributions shall
automatically be suspended for a period of six (6) months. At least twelve (12)
months must elapse from the date of a previous, partial withdrawal. In no event,
however, shall total withdrawals of a Participant under this subsection exceed
the total of such withdrawing Participant's contributions.
(c) The Trustee shall distribute any proceeds due under Paragraph (a)
and (b) next above by lump-sum payment in cash. Each Participant's account shall
be valued in accordance with the provisions of Section 6.03.
(d) In no event shall any additional Company contributions made
pursuant to Section 4.07(e) to insure the limitations of subsection 4.07(a) are
met, be withdrawn under this Section 6.04.
III
Section 6.05 is hereby amended by deleting same in its entirety and
substituting the following in lieu thereof:
6.05 Distribution Upon Withdrawal From The Plan Because of Termination
of Employment: A Participant or Participant's Beneficiary shall receive a
distribution from the Plan, as provided for herein, as soon as practicable after
the earlier of:
a) the end of the quarter in which a Participant's participation in
the Plan ceases to be effective, provided the Participant's account balance is
under $3,500 (see Section 6.06); or
b) the date the Participant's withdrawal election form is received by
the Committee;
and provided that the Participant has not been employed or reemployed by a
Participating Company prior to the date of payment of the distribution. For
purposes of this Section 6.05 the trust will be valued on the date indicated in
Section 6.05 a) or b).
A) Participation Ceases To Be Effective: Upon a Participant's
retirement or termination of employment, a Participant's participation in the
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Plan shall cease to be effective as of his payroll termination date; in the
event of death of the Participant, participation shall cease to be effective as
of the first payroll date following the end of the quarter in which the trust is
notified that death has occurred.
B) Election Form: The Participant or Participant's Beneficiary may file
with the Committee a written election form requesting one of the four following
methods of payment to be used in distribution of such Participant's account. An
election form consenting to an immediate distribution and specifying one of the
four following methods of distribution is required if a Participant's account
exceeds $3,500, and he wishes to withdraw at any time before the later of age 65
or his retirement as provided in Section 6.02.
The Committee shall then direct the Trustee to distribute to such
Participant or his Beneficiary, as may be appropriate, the value of his account.
Provided, however, in the event there are conflicting claims to a Participant's
account or in the event the Committee, for any reason, shall be in doubt as to
its right to direct payment of any amount to any Participant, Beneficiary or
Beneficiaries, the Committee may direct the Trustee to hold the Participant's
account, without liability for any interest thereon until the rights thereto
shall have been judicially determined or the Committee may direct the Trustee to
pay such account into a court of competent jurisdiction, such account to be
distributed by such court after a judicial determination of the rights thereto.
The four alternative methods which may be used in payment of a Participant's
account are:
(a) Lump-sum payment in cash;
(b) Payment in monthly installments over any designated period
of years, not to exceed ten (10) years (or the Participant's actuarial
life expectancy, if lesser), with any unpaid balance at date of
Participant's death to be payable to the surviving beneficiary
designated in accordance with Section 9.04 or, if none, to his estate.
The Committee shall direct the Trustee, after conferring with
Participant, to (1) Segregate the aggregate amount of such
Participant's account into a special account, which special account
will receive full credit for all income earned by the special account
after it is segregated; or (2) At the beginning of each quarter during
the installment period, segregate the amount of the Participant's
account needed to make such installment payments during that quarter.
The amount of the installments shall be as determined under Section
6.03 so that the Participant's number of Units in the Plan shall be
reduced by the Unit payments to be made in such quarter. The balance of
Participant's account shall remain as a part of the Trust Fund until
the next quarterly withdrawal is made to meet the subsequent
installment payments.
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(c)(1) By requesting the Trustee to use the value of such
Participant's account to purchase an annuity contract of such type and
kind as may be specified by a Participant under which such Participant
shall receive a regular equal monthly income. The annuity contract must
be for at least two (2) years, but not to exceed a fifteen (15) year
period of time (or a period of time equal to the Participant's
actuarial life expectancy, if lesser) and shall provide that upon the
Participant's death any unpaid balance shall be payable to the
Participant's beneficiary designated in accordance with Section 9.04.
(c)(2) In the case of a married Participant who elects to have
his account paid in the form of an annuity, unless the Participant
makes a valid waiver election (as hereinafter described), his account
will be distributed in the form of a qualified joint and survivor
annuity. A qualified joint and survivor annuity is an annuity payable
for the life of the Participant, with provision for a survivor annuity
payable for the life of the Participant's spouse equal to at least 50%
of the amount payable during the joint lives of the Participant and the
spouse. At any time during a ninety-day period prior to the date
payments commence to a Participant under this subsection (c)(2), such
Participant may make a waiver election to forego the qualified joint
and survivor annuity and elect an alternate form of payment, provided
the Participant's spouse consents in writing to the waiver election
(either as to a specific form of payment or in general as to all
available forms of payment), such consent acknowledges the effect of
the election, and a notary public or a member of the Committee
witnesses the spouse's consent. The spouse's consent shall be
irrevocable unless the Participant revokes his waiver election during
the above ninety-day period.
(d) A combination lump-sum payment in cash and Tandy
Corporation securities. The maximum number of Tandy Corporation
securities to be received by the Participant will be determined as
follows:
(1) Divide the total of the Corpus of the Plan into the Total
Value of each Tandy Corporation security owned by the Plan. The date of
valuation, herein, shall be the same date used in determining the value
of Participant's account under Section 6.03.
(2) Each percentage ascertained in paragraph (1) above is
multiplied by the Total Value of the Participant's account, as
ascertained under Section 6.03, resulting in the maximum Dollar Value
for each category of Tandy Corporation securities to which Participant
would be entitled.
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(3) The Dollar Value for each security as ascertained in
paragraph (2) above is divided by the price of such Tandy Corporation
security on the date provided in Section 6.05 (a) or (b), resulting in
the number of each Tandy Corporation security to be received.
(4) If the Participant desires a lesser number of securities
than provided for above, upon approval of the Committee, a lesser
number will be distributed and the balance of the Participant's account
will be paid in cash.
(5) No fractional interest will be issued.
IV
Section 6.07 is hereby amended by deleting same in its entirety and
substituting the following in lieu thereof:
6.07 Date of Payment: The payments due Participant or Participant's
beneficiary under Article VI, shall be paid as soon as possible following the
effective date of the written notice or the end of the calendar quarter next
succeeding the payroll termination date (as set out in Sections 6.04; 6.05 or
6.06 above), but not to exceed forty-five (45) days after such date. Provided,
however, in the event the Committee has received conflicting claims to an
account, or if the Committee, for any reason, shall be in doubt as to its right
to direct payment of any amount to any Participant, Beneficiary or
Beneficiaries, the forty-five (45) day time limit for payment of the account
shall not be applicable.
V
The Plan is hereby amended by inserting the following new plan names
with the former plan name where appropriate:
Tandy Stock Plan, formerly Tandy Corporation Stock Purchase Program.
Tandy Fund, formerly Tandy Employees Deferred Salary and Investment
Plan or "DIP".
Tandy Fund, formerly DIP.
Tandy Fund, formerly Tandy Employees Stock Ownership Plan.
Tandy Fund, formerly the Tandy Employees Stock Ownership Plan
("TESOP") and the Tandy Employees Deferred Salary and Investment Plan ("DIP")
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IN WITNESS WHEREOF, Company and Trustee have caused this Amendment to be
executed, effective January 1, 1996, by their duly appointed officers and their
corporate seals to be hereunto affixed.
Attest: (SEAL) TANDY CORPORATION
/s/ JANA FREUNDLICH /s/ RICHARD L RAMSEY
- ------------------------ ------------------------
Jana Freundlich Richard L. Ramsey
Assistant Secretary Vice President and
Controller
Attest: (SEAL) BANK ONE, TEXAS, NA
/s/ RICHARD L. MITCHELL /s/ J C WHITE
- ------------------------- ------------------------
Name: RICHARD L. MITCHELL Name: J.C. WHITE
------------------- ------------------
Vice President & Vice President &
Trust Officer Trust Officer
tipxlix.b
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ADDITIONAL INFORMATION
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TANDY EMPLOYEES INVESTMENT PLAN
FORT WORTH, TEXAS
ADDITIONAL INFORMATION
JUNE 30, 1996
ITEM 27a - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
Description Current
Issuer of Investment Cost Value
------ ------------- ---- --------
*Tandy Corporation Common Stock $ 814,753.87 $15,724,804.75
-------------- --------------
Money Market Fund Short-Term
Money Market
Fund - Fluc-
tuating rate
of interest $ 220,794.49 $ 20,794.49
-------------- ------------
*Party-in-Interest to Plan.
-21
<PAGE>
TANDY EMPLOYEES INVESTMENT PLAN
FORT WORTH, TEXAS
ADDITIONAL INFORMATION
YEAR ENDED JUNE 30, 1996
ITEM 27e - SCHEDULE OF NON-EXEMPT TRANSACTIONS
Identity
of Party Relationship Purchase Selling Lease
Involved to Plan Price Price Rental
- -------- ------------ ----------- ------------- ------
Tandy 401(k) Plan $270,807.33 $6,048,830.26 $0
Employees Sponsored
Deferred by Tandy
Salary & Corporation
Investment
Plan
Current
Expenses Value of
Incurred Cost Asset on Gain or
with of Transaction (Loss) on
Transaction Asset Date Transaction
- ------------ ----------- ------------- --------------
$0 $270,807.33 $6,048,830.26 $5,778,022.93
-22-
<PAGE>
SIGNATURES
The Plan: Pursuant to the requirements of the Securities Exchange Act of 1934,
the Administrative Committee has duly caused this annual report to be signed by
the undersigned hereunto duly authorized.
By /s/ M MOAD
----------------------------
M. Moad
Administrative Committee Member
By /s/ P BRADLEY
----------------------------
P. Bradley
Administrative Committee Member
Date 9-10-96
----------
-23-
<PAGE>
Index to Exhibits
Exhibit Description Page
Number of Exhibit Number
- -------- ----------- ---------
23 Consent of 25
Independent
Accountant
-24-
<PAGE>
CURTIS B. MORRISON
CERTIFIED PUBLIC ACCOUNTANT
1070 SEMINOLE TRAIL
GRANBURY, TEXAS 76048
Metro 817/279-0105
Exhibit 23
CONSENT OF INDEPENDENT ACCOUNTANT
----------------------------------
I consent to the incorporation of my report dated June 30, 1996, accompanying
the financial statements included in this annual report on form 11-K, in the
prospectus forming part of Tandy Corporation's registration statement on
Form S-8 for its Tandy Employees Investment Plan.
/s/ Curtis B. Morrison, C.P.A.
CURTIS B. MORRISON, CPA
Fort Worth, Texas
September 10, 1996
-25-
<PAGE>
EXHIBIT A
TANDY EMPLOYEES INVESTMENT PLAN (SPECIAL ACCOUNT)
FORT WORTH, TEXAS
REPORT OF EXAMINATION
JUNE 30, 1996
<PAGE>
C O N T E N T S
----------------
Page
CERTIFIED PUBLIC ACCOUNTANT'S REPORT . . . 3
STATEMENT OF FINANCIAL CONDITION . . . . . 4
STATEMENT OF INCOME AND CHANGES IN PLAN EQUITY 5
NOTES TO FINANCIAL STATEMENTS . . . . . . 6-11
ADDITIONAL INFORMATION . . . . . . . . . . . 12-13
<PAGE>
The Administrative Committee and Participants of
Tandy Employees Investment Plan (Special Account)
Fort Worth, Texas
INDEPENDENT AUDITOR'S REPORT
----------------------------
I have audited the accompanying statement of financial condition of the Tandy
Employees Investment Plan (Special Account) as of June 30, 1996 and 1995, and
the related statement of income and changes in the plan equity for the years
ended June 30, 1996, 1995 and 1994. These financial statements are the
responsibility of the Plan's management. My responsibility is to express an
opinion on these financial statements based on my audit.
I conducted my audit in accordance with generally accepted auditing standards.
Those standards require that I plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
I believe that my audit provides a reasonable basis for my opinion.
In my opinion, the financial statements referred to above present fairly, in all
material respects, the financial status of the Tandy Employees Investment Plan
(Special Account) as of June 30, 1996 and 1995, and results of its changes
therein for the years ended June 30, 1996, 1995 and 1994, in conformity with
generally accepted accounting principles.
My audit was made for the purpose of forming an opinion on the basic financial
statements taken as a whole. The supplemental schedule of assets held for
investment purposes is presented for the purpose of additional analysis and is
not a required part of the basic financial statements but is supplementary
information required by the Department of Labor's Rules and Regulations for
Reporting and Disclosure under the Employee Retirement Income Security Act of
1974. The supplemental schedule has been subjected to the auditing procedures
applied in the audit of the basic financial statements and, in my opinion, is
fairly stated in all material respects in relation to the basic financial
statements taken as a whole.
/s/ CURTIS B. MORRISON, C.P.A.
------------------------------
CURTIS B. MORRISON, CPA
Fort Worth, Texas
September 10, 1996
<PAGE>
TANDY EMPLOYEES INVESTMENT PLAN (SPECIAL ACCOUNT)
FORT WORTH, TEXAS
STATEMENT OF FINANCIAL CONDITION
JUNE 30, 1996 AND 1995
PLAN ASSETS
------------
1996 1995
----------- --------
Investment in Securities of
Participating Employer (Note B):
Common Stock (Cost $5,222.33 in
1996 and $5,222.33 in 1995) $238,580.50 $261,242.50
----------- -----------
Investments in Securities of
Unaffiliated Issuers (Note B):
Marketable Securities -
Common Stock (Cost $8,168.59 in
1996 and $8,168.59 in 1995) $ 20,965.25 $ 25,998.50
Other Securities - Short Term
Money Market Fund (Cost $107,072.64
in 1996 and $97,507.44 in 1995) 107,072.64 97,507.44
----------- -----------
$128,037.89 $123,505.94
Accrued Receivables:
Interest $ 453.22 $ 480.47
----------- -----------
$367,071.61 $385,228.91
LIABILITIES AND PLAN EQUITY
---------------------------
Liabilities $ 0 $ 0
Plan Equity:
Participant's Interest in Tandy
Employees Investment Plan
(Special Account) 367,071.61 385,228.91
----------- -----------
$367,071.61 $385,228.91
The accompanying notes are an integral part of these financial statements.
-4-
<PAGE>
TANDY EMPLOYEES INVESTMENT PLAN (SPECIAL ACCOUNT)
FORT WORTH, TEXAS
STATEMENT OF INCOME AND CHANGES IN PLAN EQUITY
FOR THE YEARS ENDED JUNE 30, 1996, 1995 AND 1994
1996 1995 1994
----------- ----------- --------
Investment Income:
Interest-Employer $ 0 $ 0 $ 225.00
Interest-Other 5,710.59 5,072.67 2,835.56
Dividends-Employer 3,827.36 3,323.76 3,021.60
----------- ----------- ----------
$ 9,537.95 $ 8,396.43 $ 6,082.16
Less: Interest Expense 0 0 0
----------- ----------- -----------
$ 9,537.95 $ 8,396.43 $ 6,082.16
----------- ----------- -----------
Realized Gain (Loss) on
Securities (Note C):
Employer Securities $ 0 $ 0 $ 930.00
Other Securities 0 0 0
----------- ----------- -----------
$ 0 $ 0 $ 930.00
----------- ----------- -----------
Increase (Decrease) in
Unrealized Appreciation
of Investments (Note E) $(27,695.25) $ 77,057.50 $ 6,550.62
------------ ----------- ----------
Contributions (Note A) $ 0 $ 0 $ 0
----------- ----------- -----------
Other Additions:
Appreciation in
Value over Cost
Distributed in
Withdrawals $ 0 $ 0 $ 0
----------- ----------- -----------
TOTAL $(18,157.30) $ 85,453.93 $ 13,562.78
Less:
Withdrawals of
Participants' Interest 0 0 0
----------- ----------- -----------
Net Increase (Decrease)
in Plan for the Years
Ending 6-30-96/95/94 $(18,157.30) $ 85,453.93 $ 13,562.78
Plan Equity at Beginning
of Year 7-1-95/94/93 385,228.91 299,774.98 286,212.20
----------- ----------- -----------
Plan Equity at End of
Year 6-30-96/95/94 $367,071.61 $385,228.91 $299,774.98
=========== =========== ===========
The accompanying notes are an integral part of these financial statements.
-5-
<PAGE>
TANDY EMPLOYEES INVESTMENT PLAN (SPECIAL ACCOUNT)
FORT WORTH, TEXAS
NOTES TO FINANCIAL STATEMENTS
FOR THE YEARS ENDED JUNE 30, 1996, 1995 AND 1994
NOTE A - DESCRIPTION OF THE PLAN
General
- -------
This Special Account was funded in 1978 from securities and cash received by two
employees of Tandy Corporation that were former employees of Tandycrafts, Inc.,
and were involved in the spin-off of the two corporations. This Special Account
has accepted no employee or employer contributions at any time.
Participants' Accounts
- ----------------------
Participants' accounts are valued as of the last day of each March, June,
September and December. Each participant is mailed a quarterly statement showing
his contributions to date, Company contributions to date, total contributions to
date and the market value of his account. Each participant is also mailed a copy
of the Tandy Corporation annual report, and the summary annual report for the
Plan.
Vesting
- -------
The participants' accounts are fully vested at the end of each calendar quarter,
except for amounts credited to the account because of fraud or mistake of fact.
Payments of Benefits
- --------------------
Payroll deductions made for a participant's Qualifying or Voluntary
Contributions to the Plan were a part of his current compensation and, as such,
were subject to withholding for federal income tax purposes.
A participant is not subject to federal income tax on Company contributions to
the Plan, or other accumulations, until he makes a withdrawal from the Plan. A
withdrawal is generally taxed only to the extent it exceeds the participant's
aggregate contributions.
The taxable portion of a "lump-sum distribution" and certain "partial
distributions" may not be subject to tax upon receipt by a participant if the
distribution is rolled over into an IRA or another qualified plan within the
prescribed time period. If a lump-sum distribution is not rolled over, a special
5-year averaging tax (intended to minimize the tax burden) may be available for
some participants with respect to the taxable portion of such distribution. As a
general rule, only one lump-sum
-6-
<PAGE>
TANDY EMPLOYEES INVESTMENT PLAN (SPECIAL ACCOUNT)
FORT WORTH, TEXAS
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEARS ENDED JUNE 30, 1996, 1995 AND 1994
NOTE A - DESCRIPTION OF THE PLAN (continued)
distribution which is received after attaining age 59-1/2 is eligible for the
special 5-year averaging (computed under the tax rates contained in the Tax
Reform Act of 1986) or the 10-year averaging (computed under prior law tax
rates).
If a lump-sum distribution consists in part of securities of Tandy Corporation,
Tandycrafts, Inc. and InterTAN Inc., the portion of such distribution which
represents net unrealized appreciation of such securities will not be currently
taxable to the recipient for federal income tax purposes (although a participant
may elect to include such appreciation in income, if desired). Upon a subsequent
disposition of such securities, gain or loss will be determined generally by
reference to their basis when they were acquired by the Plan. An additional 10%
income tax is imposed on certain early distributions included in gross income
prior to attaining age 59-1/2, death or disability. The value of a participant's
interest in the Plan is includable in his gross estate upon his death.
NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Valuation of Securities
- -----------------------
All securities are valued at the closing price according to the respective stock
exchanges.
All other securities are valued at cost.
SCHEDULE OF INVESTMENTS IN SECURITIES OF
----------------------------------------
PARTICIPATING EMPLOYER
----------------------
NO. OF VALUE
SHARES COST 6-30-96
------ ---- -------
COMMON STOCK
------------
Industrial
Tandy Corporation
Common Stock 5,036 $ 5,222.33 $238,580.50
========== ===========
-7-
<PAGE>
TANDY EMPLOYEES INVESTMENT PLAN (SPECIAL ACCOUNT)
FORT WORTH, TEXAS
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEARS ENDED JUNE 30, 1996, 1995 AND 1994
NOTE A - DESCRIPTION OF THE PLAN (continued)
SCHEDULE OF INVESTMENTS IN SECURITIES OF
----------------------------------------
UNAFFILIATED ISSUERS
--------------------
MARKETABLE SECURITIES
---------------------
NO. OF VALUE
SHARES COST 6-30-96
------ ---- -------
COMMON STOCK
------------
Industrial
InterTAN Inc.
Common Stock 1,003 $ 7,215.77 $ 5,767.25*
Tandycrafts, Inc. 2,384 952.82 $ 15,198.00*
----------- -----------
TOTAL COMMON STOCKS $ 8,168.59 $ 20,965.25
=========== ===========
- ----------------------
*Non-Income Producing.
VALUE
COST 6-30-96
---- ---------
OTHER SECURITIES
----------------
Money Market Fund
Short-Term Money Market Fund $ 107,072.64 $ 107,072.64
============= =============
-8-
<PAGE>
TANDY EMPLOYEES INVESTMENT PLAN (SPECIAL ACCOUNT)
FORT WORTH, TEXAS
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEARS ENDED JUNE 30, 1996, 1995 AND 1994
NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
Income Tax Status
- -----------------
The Plan is a qualified plan under Section 401 of the Internal Revenue Code and
is exempt from federal income taxes under Section 501.
NOTE C - REALIZED GAIN ON SECURITIES
The realized gain or loss from the sale of securities was as follows:
1996 1995 1994
----------- ----------- -------
Participating Employer
Securities:
Sales Price $ 0 $ 0 $ 3,000.00
Less Cost (Average Cost) 0 0 2,070.00
--------- ----------- -----------
Net Realized Gain (Loss) $ 0 $ 0 $ 930.00
=========== =========== ===========
Unaffiliated Issuers'
Securities:
Sales Price $ 0 $ 0 $ 0
Less Cost (Average Cost) 0 0 0
----------- ----------- -----------
Net Realized Gain (Loss) $ 0 $ 0 $ 0
=========== =========== ===========
NOTE D - UNIT VALUE
Net Asset
Quarter Ending Number of Units Valuation per Unit
-------------- --------------- ------------------
June 30, 1995 595.0900 $647.3456
September 30, 1995 595.0900 732.5761
December 31, 1995 595.0900 567.5886
March 31, 1996 595.0900 601.3638
June 30, 1996 595.0900 616.8338
-9-
<PAGE>
TANDY EMPLOYEES INVESTMENT PLAN (SPECIAL ACCOUNT)
FORT WORTH, TEXAS
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEARS ENDED JUNE 30, 1996, 1995 AND 1994
NOTE E - UNREALIZED APPRECIATION
The following reflects the increase (decrease) in unrealized appreciation:
1996 1995 1994
----------- ----------- --------
Unrealized
Appreciation
6-30-96/95/94 $246,154.83 $273,850.08 $196,792.58
Unrealized
Appreciation
7-1-95/94/93 273,850.08 196,792.58 190,241.96
----------- ----------- -----------
Change in
Unrealized
Appreciation
6-30-96/95/94 $(27,695.25) $ 77,057.50 $ 6,550.62
============ =========== ===========
The unrealized appreciation or depreciation of securities held for investment
for financial statement reporting is prepared in conformity with generally
accepted accounting principles which differ from the principles for income tax
reporting.
Generally accepted accounting principles measure unrealized appreciation or
depreciation as the difference between the securities' market value at the
Plan's year end and its historical cost. The unrealized appreciation or
depreciation for income tax reporting is the difference between the securities'
market value at the plan year end and its current value at the beginning of the
plan year.
A participant's account is increased or decreased by the unrealized appreciation
or depreciation recognized under generally accepted accounting principles.
-10-
<PAGE>
TANDY EMPLOYEES INVESTMENT PLAN (SPECIAL ACCOUNT)
FORT WORTH, TEXAS
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEARS ENDED JUNE 30, 1996, 1995 AND 1994
NOTE F - CHANGES IN PLAN
See the attached amendments made to the Plan.
NOTE G - ADMINISTRATION OF PLAN ASSETS
The Plan's assets are held by the Trustee of the Plan.
The Trustee invests cash received from interest and dividend income and makes
distributions to the participants.
Certain administrative functions are performed by employees of the Company with
no compensation from the Plan. Administrative expenses and Trustee fees are paid
directly by the Company.
-11-
<PAGE>
ADDITIONAL INFORMATION
-12-
<PAGE>
TANDY EMPLOYEES INVESTMENT PLAN (SPECIAL ACCOUNT)
FORT WORTH, TEXAS
ADDITIONAL INFORMATION
JUNE 30, 1996
ITEM 27a - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
Description Current
Issuer of Investment Cost Value
------ ------------- ---- -------
*Tandy Corporation Common Stock $ 5,222.33 $238,580.50
---------- -----------
InterTAN Inc. Common Stock $ 7,215.77 $ 5,767.25
----------- -----------
Tandycrafts, Inc. Common Stock $ 952.82 $ 15,198.00
---------- -----------
Money Market Fund Short-Term
Money Market
Fund - Fluc-
tuating rate
of interest $107,072.64 $107,072.64
----------- -----------
*Party-in-Interest to Plan.
-13-
