<PAGE>
REGISTRATION NO. 333-27297
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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AMENDMENT NO. 2
TO
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
TANDY CORPORATION
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
DELAWARE 75-1047710
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER IDENTIFICATION
INCORPORATION OR ORGANIZATION) NUMBER)
100 THROCKMORTON STREET, SUITE 1800, FORT WORTH, TEXAS 76102 817-390-3700
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF
REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
COPIES OF CORRESPONDENCE TO:
MARK C. HILL, ESQ.
DWIGHT A. KINSEY, ESQ.
VICE PRESIDENT AND SECRETARY
TANDY CORPORATION SATTERLEE STEPHENS BURKE & BURKE
100 THROCKMORTON STREET, SUITE 1800 LLP
FORT WORTH, TEXAS 76102 230 PARK AVENUE
NEW YORK, NEW YORK 10169
817-390-3294
(NAME, ADDRESS, INCLUDING ZIP CODE, CRAIG B. BROD, ESQ.
AND TELEPHONE NUMBER, INCLUDING CLEARY, GOTTLIEB, STEEN & HAMILTON
AREA CODE, OF AGENT FOR SERVICE) ONE LIBERTY PLAZA
NEW YORK, NEW YORK 10006
---------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
From time to time after this registration statement becomes effective.
---------------
If the only securities being registered on this form are being offered
pursuant to dividend or interest reinvestment plans, please check the
following box. [_]
If any of the securities being registered on this form are being offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or
interest reinvestment plans, please check the following box. [X]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following
box and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [_]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [_]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [_]
---------------
CALCULATION OF REGISTRATION FEE
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<TABLE>
<CAPTION>
PROPOSED
AMOUNT TO BE MAXIMUM PROPOSED MAXIMUM
TITLE OF SECURITIES TO BE REGISTERED OFFERING PRICE AGGREGATE OFFERING AMOUNT OF
REGISTERED (1) PER UNIT (2) PRICE(1)(2) REGISTRATION FEE(3)
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<S> <C> <C> <C> <C>
Debt Securities.................. $300,000,000 100% $300,000,000 $90,910
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</TABLE>
(1) Plus such additional principal amount as may be necessary such that, if
Debt Securities are issued with original issue discount, the aggregate
initial offering price of all Debt Securities will equal $300,000,000, or
the equivalent of $300,000,000 if some or all of the securities are
denominated in one or more foreign currencies or composite currencies.
(2) Estimated solely for the purpose of calculating the registration fee.
(3) Previously paid.
---------------
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT
SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS
REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH
SECTION 8(A) OF THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT
SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID
SECTION 8(A), MAY DETERMINE.
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<PAGE>
EXPLANATORY NOTE
The Debt Securities registered hereby may be offered from time to time by
means of the basic prospectus included herein and, when a particular series of
such Debt Securities is being offered or sold, such series of Debt Securities
may be offered or sold by means of the basic prospectus included herein and an
applicable prospectus supplement. If any series of Debt Securities registered
hereby are offered or sold in reliance upon the procedures contemplated by
Rule 430A under the Securities Act of 1933, as amended, such series of Debt
Securities will be offered or sold by means of the basic prospectus included
herein and a prospectus supplement in the form included herein. Series of Debt
Securities registered hereby which are not offered or sold in reliance upon
the procedures contemplated by Rule 430A may be offered or sold by means of
the basic prospectus included herein and a prospectus supplement in a form
other than the form of the supplement included herein.
1
<PAGE>
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
+INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A +
+REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE +
+SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY +
+OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT +
+BECOMES EFFECTIVE. THIS PROSPECTUS SUPPLEMENT AND THE ACCOMPANYING PROSPECTUS +
+SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY +
+NOR SHALL THERE BE ANY SALE OF THESE SECURITIES IN ANY STATE IN WHICH SUCH +
+OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR TO REGISTRATION OR +
+QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE. +
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
SUBJECT TO COMPLETION, DATED JULY 31, 1997
PROSPECTUS SUPPLEMENT TO PROSPECTUS DATED AUGUST , 1997
$150,000,000
TANDY CORPORATION
% NOTES DUE SEPTMBER 1, 2007
-----------
Interest on the % Notes due September 1, 2007 (the "Notes") issued by Tandy
Corporation (the "Company") is payable on September 1 and March 1 of each year,
commencing March 1, 1998. The Notes are unsecured, are not redeemable prior to
maturity and will not be subject to any sinking fund.
The Notes will be represented by global securities registered in the name of
a nominee of The Depository Trust Company (the "Depositary"). Beneficial
interests in the Notes will be shown on, and transfers thereof will be effected
only through, records maintained by the Depositary (with respect to
participants' interests) and its participants. The Notes will be issued only in
denominations of $1,000 and integral multiples thereof. Except as described
herein, Notes in definitive form will not be issued. See "Description of
Notes--Book Entry Procedures." The Notes will trade in the Depositary's Same-
Day Funds Settlement System until maturity, and secondary market trading
activity for the Notes will therefore settle in immediately available funds.
All payments of principal and interest will be made by the Company in
immediately available funds. See "Description of Notes."
-----------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION, NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS SUPPLEMENT OR THE
PROSPECTUS TO WHICH IT RELATES. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
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<TABLE>
<CAPTION>
INITIAL PUBLIC UNDERWRITING PROCEEDS TO
OFFERING PRICE (1) DISCOUNT (2) COMPANY (1)(3)
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<S> <C> <C> <C>
Per Note......................... % % %
Total............................ $ $ $
</TABLE>
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(1) Plus accrued interest, if any, from August , 1997.
(2) The Company has agreed to indemnify the Underwriters against certain
liabilities, including liabilities under the Securities Act of 1933, as
amended.
(3) Before deducting estimated expenses of $145,000 payable by the Company.
-----------
The Notes offered hereby are offered severally by the Underwriters, as
specified herein, subject to receipt and acceptance by them and subject to
their right to reject any order in whole or in part. It is expected that the
Notes will be delivered in book-entry form through the facilities of The
Depository Trust Company in New York, New York, on or about August , 1997,
against payment therefor in immediately available funds.
-----------
BEAR, STEARNS & CO. INC.
MERRILL LYNCH & CO.
SALOMON BROTHERS INC
RAUSCHER PIERCE REFSNES, INC.
The date of this Prospectus Supplement is August , 1997
<PAGE>
CERTAIN PERSONS PARTICIPATING IN THIS OFFERING MAY ENGAGE IN TRANSACTIONS
THAT STABILIZE, MAINTAIN OR OTHERWISE AFFECT THE PRICE OF THE NOTES, INCLUDING
OVER-ALLOTMENT, STABILIZING AND SHORT-COVERING TRANSACTIONS AND THE IMPOSITION
OF PENALTY BIDS. SEE "UNDERWRITING".
NOTE REGARDING FORWARD-LOOKING STATEMENTS
This Prospectus Supplement, the accompanying Prospectus and the documents
incorporated herein by reference contain "forward-looking statements" within
the meaning of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended, which
represent the Company's projections, estimates, expectations or beliefs
concerning, among other things, financial items that relate to management's
future plans or objectives or to the Company's future economic and financial
performance. Forward-looking statements involve known and unknown risks and
uncertainties and are indicated by words such as "anticipates", "expects",
"believes", "plans", "could" and similar words and phrases. These risks and
uncertainties include, but are not limited to, economic conditions including
consumer installment debt levels and interest rate fluctuations, shifts in
consumer electronic product cycles, technological advances or a lack thereof,
consumer demand for products and services, competitive products and pricing,
availability of products, inventory risks due to shifts in market demand, the
regulatory and trade environment and such other risks and uncertainties
described in the Company's reports and filings with the Securities and
Exchange Commission incorporated by reference herein, including in "Item 1--
Business" and "Item 7--Management's Discussion and Analysis of Results of
Operations and Financial Condition" in the Company's Annual Report on Form 10-
K for the fiscal year ended December 31, 1996 (the "1996 Form 10-K"), "Item
2--Management's Discussion and Analysis of Results of Operations and Financial
Condition" in the Company's Quarterly Report on Form 10-Q for the quarterly
period ended March 31, 1997 (the "March 1997 Form 10-Q") and the Company's
Current Report on Form 8-K filed on July 21, 1997. Potential investors are
cautioned that certain events or circumstances could cause the Company's
actual performance and financial results in future periods to differ
materially from those estimated or anticipated.
S-2
<PAGE>
THE COMPANY
The following summary of the business of the Company is qualified in its
entirety by and should be read together with the more detailed information and
the audited and unaudited financial statements, including the notes thereto,
included or incorporated by reference in this Prospectus Supplement and the
accompanying Prospectus.
Tandy Corporation ("Tandy" or the "Company") engages in the retail sale of
consumer electronics, including personal computers, primarily in the United
States. The Company's principal retail operations include the RadioShack(R)
and Computer City(R) store chains with approximately 6,900 retail locations.
RadioShack sells primarily private label electronic parts and accessories,
audio/video equipment, digital satellite systems, personal computers and
cellular and conventional telephones, as well as specialized products such as
scanners, electronic toys and hard-to-find batteries. The Computer City chain
operates primarily as a "supercenter" format featuring name brand computers,
software and related products.
RADIOSHACK
RadioShack is the Company's largest operating division, offering the
shopping convenience of approximately 6,800 company-owned and dealer stores.
RadioShack stores offer primarily private label electronic parts and
accessories, audio/video equipment, digital satellite systems, personal
computers and cellular and conventional telephones, as well as specialized
products such as scanners, electronic toys and hard-to-find batteries.
RadioShack is committed to a retail environment that emphasizes knowledgeable
personnel and excellent customer service, including a "service-oriented"
approach. RadioShack has formed strategic relationships with key vendors to
market their products such as computers (IBM(R)), home security (ADT(R)),
direct-to-home satellite (RCA(R), PRIMESTAR(R), DIRECTV(R) and USSB(R)),
telecommunications and wireless communications (Sprint(R) and Sprint PCSSM).
These relationships augment the strong position RadioShack has historically
maintained in core product categories such as batteries, communications
equipment, telephones, antennas, electronic components, and parts and
accessories.
The RadioShack division operates approximately 4,900 company-owned stores,
located throughout the United States. These company-owned stores average
approximately 2,450 square feet and are located in major malls, strip centers
and individual store fronts. RadioShack plans to expand its company-owned
store base to approximately 5,000 locations by the year 2000. To provide
RadioShack products to smaller communities, RadioShack has a network of
approximately 1,900 dealer/franchise stores, including 57 international
stores.
RadioShack provides access to third party services such as cellular phone,
PCS (wireless personal communication services using a higher designated
frequency than traditional cellular communication), direct satellite
programming and pager service. RadioShack is also focusing on becoming
"America's Telephone Store". In connection with its recent alliance with
Sprint and its plans to implement a Sprint "store-within-a-store" concept at
its RadioShack store locations, Tandy intends to promote RadioShack as a "one
stop" telephone store with a broad assortment of wired and wireless
telecommunications products and services. For a discussion of RadioShack's
recent alliance with Sprint, see "Item 7--Management's Discussion and Analysis
of Results of Operations and Financial Condition--Net Sales and Operating
Revenues" in the 1996 Form 10-K incorporated herein by reference. For its
personal computer sales, which accounted for approximately 11.0% of the
RadioShack division's net sales and operating revenues in fiscal year 1996,
Tandy primarily targets the home and the small business markets.
COMPUTER CITY
Computer City stores offer approximately 4,400 different name brand items
(including computers, software and related products in such brands as IBM(R),
Sony(R), Lotus(R), Microsoft(R), Compaq(R), AST(R) and Hewlett Packard(R)),
competitive prices and customer service on computers, computer software and
accessories. Computer City operates two different size formats, Computer City
SuperCenters with 82 units and Computer City Express
S-3
<PAGE>
with 11 units, including five in Europe and seven in Canada. The SuperCenters
average approximately 21,150 square feet. Computer City Express stores average
approximately 12,300 square feet, serve smaller markets and supplement
SuperCenters in larger markets. The Company plans to open approximately four
additional Computer City stores in 1997. The 93 stores in operation at March
31, 1997 exclude the 21 Computer City stores closed pursuant to the Company's
December 30, 1996 restructuring announcement. All of these stores were closed
by March 31, 1997.
INCREDIBLE UNIVERSE
On December 30, 1996, the Company announced its plan to exit the Incredible
Universe business. At December 31, 1996, there were 17 open Incredible
Universe locations and two that had been previously closed. The Company has
concluded the sale of six Incredible Universe stores, and related fixed assets
and inventory, to Fry's Electronics, Inc. ("Fry's") and its affiliates in
exchange for approximately $21.5 million in cash and $96.7 million in notes
receivable. Of the remaining 13 stores, the Company has sold five stores for
an aggregate sales price of approximately $45 million in cash and $15 million
in marketable securities. The Company anticipates that three additional stores
will be sold by October 31, 1997 under an existing agreement for one store and
two agreements expected to be entered into for two stores for an aggregate
sales price of approximately $37.5 million payable in cash, notes and
marketable securities. The Company intends to dispose of the remaining five
stores by December 31, 1997. There can be no assurance that any of the planned
sales or dispositions will occur.
For further discussion of the store closures and related restructuring, see
"Item 7 Management's Discussion and Analysis of Results of Operations and
Financial Condition--Provision for Business Restructuring" in the 1996 Form
10-K and "Notes to Consolidated Financial Statements (Unaudited) Note 4--
Restructuring Reserves" in the March 1997 Form 10-Q incorporated herein by
reference. Unexpected delays in liquidation and closing of asset sales or
further changes in Company strategy, among other factors, could result in
charges and reserves previously estimated being inadequate, and future charges
may be required.
For additional information with respect to the Company's business, see "Item
1--Business" in the 1996 Form 10-K incorporated by reference herein.
RECENT DEVELOPMENTS
On June 26, 1997, the Company organized a new subsidiary, Computer City,
Inc. ("CCI"), and thereafter conveyed to it certain related assets and
liabilities of the Company's Computer City division. On July 17, 1997 Eureka
Venture Partners III, LLP, a Texas limited liability partnership ("Eureka"),
entered into a Stock Purchase Agreement with the Company to acquire 19.9% of
the outstanding common stock of CCI for a total of $24.9 million in cash and a
non-recourse note issued by Eureka. Substantially all of the purchase price is
payable in such non-recourse note of Eureka. The note accrues interest at 8%
per annum and is payable on or before July 17, 2002. Pursuant to the terms of
the Stock Purchase Agreement, Eureka and its principals will provide a new
senior management team for CCI. This new management team will consist of
Nathan Morton, CCI Chief Executive Officer and Co-Chairman, Avery More, CCI
Vice Chairman, and Robert Boutin, CCI Chief Financial Officer. John V. Roach,
the Chairman and Chief Executive Officer of the Company, will serve as the
other Co-Chairman of CCI and as its President. The Board of Directors of CCI
will consist of eight members, four from the Company and four from Eureka.
Eureka also acquired a warrant to purchase an additional 20.1% of the
outstanding common stock of CCI for $31.4 million in cash and a non-recourse
note issued by Eureka. Substantially all of the exercise price of the warrant
is payable in the form of such non-recourse note of Eureka. This warrant is
exercisable upon the attainment of certain financial performance goals by CCI
or CCI is established as an independent entity.
In connection with the creation of CCI, the Company assigned to CCI, and CCI
assumed the Company's obligations under, a $125 million subordinated note.
This subordinated note represented certain liabilities of the Company
allocable to its Computer City division that were assumed by CCI. Also on July
17, 1997, the
S-4
<PAGE>
Company provided to CCI a $150 million line of credit expiring on December 31,
1997. Any amounts borrowed under such line of credit are secured by CCI's
inventories and accounts receivable.
The Company and Eureka intend to look into the possibility of establishing
CCI as a wholly independent entity in the future in one or more transactions.
There can be no assurance, however, that any such transaction or transactions
will occur.
If certain financial performance goals are met by CCI and a sale of CCI is
effected without the approval of the CCI Board of Directors, then Eureka has
the option to require the Company to repurchase all shares owned by Eureka and
the exercisable but unexercised portion of the warrant for certain amounts, as
provided in the Stock Purchase Agreement. In addition, prior to the CCI being
established as an independent entity, the Company has the right to reacquire
all of the shares of CCI owned by Eureka and the exercisable but unexercised
portion of the warrant upon payment of certain amounts, as described in the
Stock Purchase Agreement.
SECOND QUARTER RESULTS OF THE COMPANY
On July 22, 1997, the Company announced its results for the second quarter
and first six months of fiscal year 1997. Net sales and operating revenues were
$1.1 billion and $1.4 billion for the three months ended June 30, 1997 and
1996, respectively. Net sales and operating revenues were $2.4 billion and $2.8
billion for the six months ended June 30, 1997 and 1996, respectively. Net
income was $28.7 million ($0.50 per share) during the three months ended June
30, 1997 as compared to $9.3 million ($0.13 per share) during the corresponding
1996 period. For the six months ended June 30, 1997 and 1996, net income was
$54.3 million ($0.92 per share) and $23.8 million ($0.34 per share),
respectively.
USE OF PROCEEDS
The net proceeds to the Company from the sale of the Notes offered hereby are
estimated to be approximately $148.9 million after deducting estimated
underwriting discounts and commissions, and estimated expenses of the offering.
The Company will use substantially all of the net proceeds to reduce its short-
term debt consisting of short-term bank debt pursuant to uncommitted bank lines
of credit and commercial paper which have maturities of less than 90 days. As
of June 30, 1997 these borrowings totaled approximately $445 million with
interest rates ranging between 5.76% and 6.00%. Proceeds from these bank
borrowings and commercial paper were utilized for inventory requirements,
Company common stock repurchases and other general corporate purposes. Any net
proceeds not used to repay short-term debt will be used for general corporate
purposes. The Company may reborrow short-term bank debt and utilize commercial
paper borrowings in the future.
S-5
<PAGE>
CAPITALIZATION
The following table sets forth the short-term debt and capitalization of the
Company as of March 31, 1997 and as adjusted to reflect the issuance of the
Notes and the application of the net proceeds therefrom as described under
"Use of Proceeds". For further discussion of the Company's capitalization
presented in the schedule below, see the Company's March 1997 Form 10-Q and
Notes 12 and 17 to the Company's Consolidated Financial Statements in the 1996
Form 10-K incorporated by reference herein.
<TABLE>
<CAPTION>
MARCH 31, 1997
--------------------
AS
ACTUAL ADJUSTED
--------- ---------
(IN MILLIONS)
<S> <C> <C>
Short-term debt (1)................................... $ 361.6 $ 212.7
========= =========
Current maturities of long-term debt (2) ............. $ 41.4 $ 41.4
========= =========
Long-term debt (3).................................... 104.2 104.2
% Notes due 2007 ................................... -- 150.0
--------- ---------
Total long-term debt ............................. 104.2 254.2
--------- ---------
Stockholders' equity:
Preferred stock, no par value, 1.0 million shares au-
thorized:
Series A Junior Participating, 0.1 million shares
authorized
and none issued or outstanding .................... -- --
Series B Convertible, 0.1 million shares authorized,
0.1 million shares issued and outstanding (4)...... 100.0 100.0
Common stock, $1.00 par value, 250.0 million shares
authorized,
85.6 million shares issued and outstanding........... 85.6 85.6
Additional paid-in capital............................ 106.3 106.3
Retained earnings .................................... 2,202.4 2,202.4
Common stock in treasury, at cost, 30.7 million shares
(5).................................................. (1,273.7) (1,273.7)
Other equity (6) ..................................... (49.5) (49.5)
--------- ---------
Total stockholders' equity ....................... 1,171.1 1,171.1
--------- ---------
Total long-term capitalization ................... $ 1,275.3 $ 1,425.3
========= =========
</TABLE>
- --------
(1) Short-term debt consists of $207.7 million of outstanding commercial paper
supported by a $500.0 million revolving credit facility (under which no
amounts were outstanding as of March 31, 1997), $146.7 million of
uncommitted money market borrowings from commercial banks and a $7.2
million short-term note payable.
(2) Current maturities of long-term debt consists of $28.7 million of medium-
term notes payable, $12.3 million associated with the Company's guarantee
of the Tandy Employees Stock Ownership Plan ("TESOP") indebtedness and
$0.4 million of capitalized lease obligations.
(3) Long-term debt consists of $39.9 million associated with the Company's
guarantee of TESOP indebtedness (with rates ranging from 6.47% to 9.34%),
$29.2 million of capitalized lease obligations, $26.0 million of medium-
term notes payable (with rates ranging from 7.25% to 8.63%) and $9.1
million of other notes payable (with variable interest rates currently
ranging from 4.63% to 6.63%).
(4) On July 31, 1990, the trustee for the TESOP, now the Tandy Fund, issued
$100.0 million of Guaranteed TESOP Notes due June 30, 2000 and used the
proceeds from the sale thereof to purchase 100,000 shares of Series B
Convertible Preferred Stock from the Company at a price of $1,000 per
share.
(5) The Company currently has authorization to purchase up to 15 million
shares, of which approximately 6.7 million shares had been purchased as of
March 31, 1997.
(6) Other equity consists of "Foreign currency translation effects," "Unearned
deferred compensation related to TESOP" and "Unrealized loss on securities
available for sale".
S-6
<PAGE>
SELECTED CONSOLIDATED FINANCIAL DATA
The following selected consolidated financial data should be read in
conjunction with the consolidated financial statements (including the notes
thereto) included in the 1996 Form 10-K and the March 1997 Form 10-Q, which
are incorporated herein by reference. The selected consolidated financial data
for the Company for the three month periods ended March 31, 1997 and 1996 have
been derived from unaudited interim financial statements of the Company which,
in the opinion of management, reflect all adjustments (consisting of normal
recurring adjustments) necessary for a fair presentation of such data.
Operating results for the three months ended March 31, 1997 are not
necessarily indicative of the results that may be expected for the fiscal year
ending December 31, 1997 or for any future periods.
<TABLE>
<CAPTION>
THREE MONTHS ENDED SIX MONTHS ENDED YEAR ENDED
MARCH 31, YEAR ENDED DECEMBER 31, DECEMBER 31, (1) JUNE 30,
-------------------- ------------------------------------------ ------------------ ----------
1997 1996 1996 1995 1994 1993 1992 1991 1992
--------- --------- -------- -------- -------- -------- -------- -------- ----------
(DOLLARS IN MILLIONS, EXCEPT PER SHARE AMOUNTS AND RATIOS)
(UNAUDITED)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
SELECTED OPERATIONS
DATA:
Net sales and operating
revenues ............. $ 1,291.7 $ 1,447.0 $6,285.5 $5,839.1 $4,943.7 $4,102.6 $2,161.1 $2,031.8 $3,649.3
Cost of products sold . 840.1 955.3 4,263.1 3,764.9 3,017.6 2,382.7 1,221.2 1,069.5 1,926.4
--------- --------- -------- -------- -------- -------- -------- -------- --------
Gross profit........... 451.6 491.7 2,022.4 2,074.2 1,926.1 1,719.9 939.9 962.3 1,722.9
Selling, general and
administrative ....... 379.5 413.9 1,761.1 1,646.5 1,532.7 1,354.7 761.8 730.7 1,342.1
Depreciation and
amortization.......... 23.6 25.4 108.6 92.0 84.8 79.9 40.0 36.3 74.5
Interest income ....... (2.2) (3.8) (13.0) (42.3) (78.6) (65.5) (33.3) (30.6) (67.4)
Interest expense....... 9.0 7.1 36.4 33.7 30.0 39.7 20.5 24.0 43.2
Provision for
restructuring
costs(2).............. -- -- 162.1 1.1 89.1 -- 48.0 -- --
Impairment of long-
lived assets(3) ...... -- 26.0 112.8 -- -- -- -- -- --
Gain from sale of
credit accounts and
extended service
contracts(4) ......... -- -- -- -- (91.4) -- -- -- --
--------- --------- -------- -------- -------- -------- -------- -------- --------
Income (loss) before
income taxes,
discontinued
operations and
cumulative effect of
change in accounting
principle ............ 41.7 23.1 (145.6) 343.2 359.5 311.1 102.9 201.9 330.5
Provision (benefit) for
taxes ................ 16.1 8.6 (54.0) 131.3 135.2 115.5 35.2 73.2 119.8
--------- --------- -------- -------- -------- -------- -------- -------- --------
Income (loss) from
continuing operations
...................... 25.6 14.5 (91.6) 211.9 224.3 195.6 67.7 128.7 210.7
Loss from discontinued
operations(5) ........ -- -- -- -- -- (111.8) (63.9) (8.1) (26.9)
--------- --------- -------- -------- -------- -------- -------- -------- --------
Income (loss) before
cumulative effect of
change in accounting
principle ............ 25.6 14.5 (91.6) 211.9 224.3 83.8 3.8 120.6 183.8
Cumulative effect of
change in accounting
principle(6).......... -- -- -- -- -- 13.0 -- -- --
--------- --------- -------- -------- -------- -------- -------- -------- --------
Net income (loss) ..... $ 25.6 $ 14.5 $ (91.6) $ 211.9 $ 224.3 $ 96.8 $ 3.8 $ 120.6 $ 183.8
========= ========= ======== ======== ======== ======== ======== ======== ========
Net income (loss) from
continuing operations
per average common and
common equivalent
share................. $ 0.43 $ 0.21 $ (1.64) $ 3.12 $ 2.91 $ 2.50 $ 0.87 $ 1.61 $ 2.61
Dividends declared per
common share.......... $ 0.20 $ 0.20 $ 0.80 $ 0.74 $ 0.63 $ 0.60 $ 0.30 $ 0.30 $ 0.60
SELECTED BALANCE SHEET
DATA:
Total assets(7) ....... $ 2,385.7 $ 2,685.5 $2,583.4 $2,722.1 $3,243.8 $3,219.1 $3,381.4 N/A $3,165.2
Working capital........ $ 649.9 $ 1,050.7 $ 746.3 $1,088.3 $1,350.1 $1,128.3 $1,478.0 N/A $1,556.4
Total debt(8) ......... $ 507.2 $ 370.0 $ 362.3 $ 330.7 $ 382.4 $ 574.6 $ 708.5 N/A $ 588.6
Total debt as a % of
total capitalization.. 30.2% 19.1% 22.3% 17.1% 17.1% 22.8% 27.3% N/A 23.4%
OTHER DATA:
Earnings before
interest, taxes,
depreciation and
amortization
(EBITDA)(9).............$ 72.1 $ 51.8 $ (13.6) $ 426.6 $ 395.7 $ 365.2 $ 130.1 $ 231.6 $ 380.8
Ratio of earnings to
fixed charges(10)....... 2.47 1.85 * (10) 4.22 4.56 3.89 2.83 N/A 3.95
Net cash provided by
operating activities . $ (11.7) $ 23.6 $ 307.5 $ 673.0 $ 268.9 $ 322.3 $ 13.7 N/A $ 146.8
Net cash provided
(used) by investing
activities (11) ...... $ (24.4) $ (46.6) $ (112.9) $ (180.3) $ 236.6 (12) $ (57.5) $ (90.2) N/A $ (102.2)
Net cash provided
(used) by financing
activities(12)..........$ 16.1 $ (15.1) $ (216.6) $ (554.8) $ (513.1) $ (164.2) $ 82.7 N/A $ (124.4)
</TABLE>
- -------
(1) In 1992, the Company changed its fiscal year end from June 30 to December
31 effective with the six-month transition period ended December 31, 1992.
(2) For further discussion regarding "Provision for restructuring costs", see
Note 3 to the Consolidated Financial Statements included in the 1996 Form
10-K incorporated herein by reference.
(3) For further discussion regarding "Impairment of long-lived assets", see
Note 4 to the Consolidated Financial Statements included in the 1996 Form
10-K incorporated herein by reference.
S-7
<PAGE>
(4) For further discussion regarding "Gain from sale of credit accounts and
extended service contracts", see Note 6 to the Consolidated Financial
Statements included in the 1996 Form 10-K incorporated herein by
reference.
(5) During 1993, the Company discontinued and disposed of its computer
manufacturing business, O'Sullivan Industries Inc., Memtek's Product
Division and the Lika printed circuit board business.
(6) The change in 1993 reflected the Company's change in accounting for income
taxes to comply with Statement of Financial Accounting Standards,
"Accounting for Income Taxes" ("FAS 109").
(7) Includes investment in discontinued operations through December 31, 1993,
as discussed in (5) above.
(8) Total debt includes short-term debt, current maturities of long-term debt,
capital leases, TESOP indebtedness and long-term debt.
(9) EBITDA consists of earnings before interest income, interest expense,
income taxes, depreciation and amortization. EBITDA is not a measure of
financial performance under generally accepted accounting principles and
should not be considered in isolation or as an alternative to net income
as a measure of operating performance or to cash flows from operating
activities as a measure of liquidity. EBITDA should be considered in
conjunction with all of the information in the Selected Consolidated
Financial Data, the Company's Consolidated Financial Statements and the
Notes thereto prepared in accordance with generally accepted accounting
principles and included in the 1996 Form 10-K and the March 1997 Form 10-Q
incorporated herein by reference. The Company has presented EBITDA because
it is used by certain investors to determine a company's ability to
service debt.
(10) Computed using income from continuing operations. For purposes of
calculating the ratio of earnings to fixed charges, "earnings" consist of
income before income taxes plus fixed charges. "Fixed charges" consist of
interest expense, amortization of debt issuance expenses and discount and
an appropriate portion of rental expense that represents a reasonable
approximation of the interest factor (currently deemed to be one third).
Earnings before income taxes were not sufficient to cover fixed charges
during 1996 by approximately $145.6 million.
(11) Includes cash used for additions to property, plant and equipment, cash
provided by proceeds from the sales of property, plant and equipment,
proceeds from the sale of divested operations, proceeds from payment on
AST note and cash used or provided by other investing activities. Net
cash provided by investing activities during 1994 primarily includes cash
used for additions to property, plant and equipment of $180.5 million,
cash provided by proceeds from the sales of property, plant and equipment
of $56.4 million and proceeds from the sale of divested operations of
$359.0 million.
(12) Includes cash used for purchases of treasury stock and payment of
dividends; includes cash provided by sales of treasury stock to the
employee stock purchase program, proceeds from the exercise of stock
options and, in the fiscal year ended June 30, 1992, issuance of
preferred stock. Also includes cash provided (used) by changes in debt.
S-8
<PAGE>
DESCRIPTION OF NOTES
The following description of the particular terms of the Notes offered
hereby (referred to in the accompanying Prospectus as the "Debt Securities")
supplements, and to the extent inconsistent therewith replaces, the
description of the general terms and provisions of the Debt Securities set
forth in the accompanying Prospectus, to which description reference is hereby
made. Capitalized terms not defined herein have the meanings assigned to such
terms in the Prospectus.
GENERAL
The Notes offered hereby will be limited to $150,000,000 aggregate principal
amount and will mature on September 1, 2007. The Notes are not entitled to a
sinking fund. Interest at the applicable annual rate set forth on the cover
page of this Prospectus Supplement will be payable semiannually on September 1
and March 1, commencing March 1, 1998, to the persons in whose names the Notes
are registered at the close of business on August 15 or February 15, as the
case may be, preceding such interest payment date. Interest on the Notes will
accrue from August , 1997 or from the most recent interest payment date to
which interest has been paid or provided for to, but excluding, the next
interest payment date. The Notes constitute a separate series of Debt
Securities under the Indenture described in the Prospectus and will be issued
in denominations of $1,000 and integral multiples thereof.
The Notes will be unsecured and will rank on a parity with each other and
with approximately $507,000,000 of unsecured and unsubordinated indebtedness
of the Company.
The Indenture does not contain any covenants or provisions that would afford
Note holders protection in the event of a highly leveraged transaction.
The Indenture does not contain any covenants or provisions that would afford
Note holders protection in the event of a change in control of the Company.
The Notes may not be redeemed prior to maturity.
The provisions described in the Prospectus under "Description of Debt
Securities--Defeasance" will be applicable to the Notes.
BOOK-ENTRY PROCEDURES
The Notes will be issued in the form of one or more fully registered Global
Securities (the "Global Securities"), which will be deposited with, or on
behalf of, The Depository Trust Company, New York, New York (the
"Depositary"), and registered in the name of the Depositary's nominee. Except
as set forth below, the Global Securities may be transferred, in whole or in
part, only to another nominee of the Depositary or to a successor of the
Depositary or its nominee.
The Depositary has advised the Company and the Underwriters as follows: The
Depositary is a limited-purpose trust company that was created to hold
securities for its participating organizations (the "Participants") and to
facilitate the clearance and settlement of securities transactions between
Participants in such securities through electronic book-entry changes in
accounts of its Participants. Participants include securities brokers and
dealers (including certain of the Underwriters), banks (including the Trustee)
and trust companies, clearing corporations and certain other organizations.
Access to the Depositary's system is also available to others such as banks,
brokers, dealers and trust companies that clear through or maintain a
custodial relationship with a Participant, either directly or indirectly
("indirect participants"). Persons who are not Participants may beneficially
own securities held by the Depositary only through Participants or indirect
participants.
Pursuant to procedures established by the Depositary, (i) upon issuance of
the Notes by the Company, the Depositary will credit the accounts of
Participants designated by the Underwriters with the principal amounts of
S-9
<PAGE>
the Notes purchased by the Underwriters, and (ii) ownership of beneficial
interests in the Global Securities will be shown on, and the transfer of that
ownership will be effected only through, records maintained by the Depositary
(with respect to the Participants' interests), the Participants and the
indirect participants. The laws of some states require that certain persons
take physical delivery in definitive form of securities that they own.
Consequently, the ability to transfer beneficial interests in the Global
Securities is limited to such extent.
So long as a nominee of the Depositary is the registered owner of the Global
Securities, such nominee for all purposes will be considered the sole owner or
holder of the corresponding Notes under the Indenture. Except as provided
below, owners of beneficial interests in the Global Securities will not be
entitled to have Notes registered in their names, will not receive or be
entitled to receive physical delivery of Notes in definitive form, and will
not be considered the owners or holders thereof under the Indenture.
The Trustee, any Paying Agent and the Security Registrar will not have any
responsibility or liability for any aspect of the records relating to or
payments made on account of beneficial ownership interests in the Global
Securities, or for maintaining, supervising or reviewing any records relating
to such beneficial ownership interests.
Principal and interest payments on the Notes registered in the name of the
Depositary's nominee will be made by the Trustee to the Depositary's nominee
as the registered owner of the Global Securities. Under the terms of the
Indenture, the Company and the Trustee will treat the persons in whose names
the Notes are registered as the owners of such Notes for the purpose of
receiving payment of principal and interest on the Notes and for all other
purposes whatsoever. Therefore, neither the Company, the Trustee nor any
Paying Agent has any direct responsibility or liability for the payment of
principal or interest on the Notes to owners of beneficial interests in the
Global Securities. The Depositary has advised the Company and the Trustee that
its present practice is, upon receipt of any payment of principal or interest,
to immediately credit the accounts of the Participants with such payment in
amounts proportionate to their respective holdings in principal amount of
beneficial interests in the Global Securities as shown on the records of the
Depositary. Payments by Participants and indirect participants to owners of
beneficial interests in the Global Securities will be governed by standing
instructions and customary practices, as is now the case with securities held
for the accounts of customers in bearer form or registered in "street name"
and will be the responsibility of the Participants or indirect participants.
If the Depositary is at any time unwilling or unable to continue as
depositary and a successor depositary is not appointed by the Company within
90 days, the Company will issue Notes in definitive form in exchange for the
Global Securities. In addition, the Company may at any time determine not to
have the Notes represented by Global Securities and, in such event, will issue
Notes in definitive form in exchange for the Global Securities. In either
instance, an owner of a beneficial interest in the Global Securities will be
entitled to have Notes equal in principal amount to such beneficial interest
registered in its name and will be entitled to physical delivery of such Notes
in definitive form. Notes so issued in the definitive form will be issued in
denominations of $1,000 and integral multiples thereof and will be issued in
registered form only, without coupon.
S-10
<PAGE>
UNDERWRITING
Subject to the terms and conditions set forth in the Underwriting Agreement
and the applicable Terms Agreement, each dated August , 1997, the Company
has agreed to sell to each of the Underwriters named below, for whom Bear,
Stearns & Co. Inc., Merrill Lynch, Pierce, Fenner & Smith Incorporated,
Salomon Brothers Inc and Rauscher Pierce Refsnes, Inc. are acting as
representatives (the "Representatives"), and each of the Underwriters has
severally agreed to purchase, the principal amount of the Notes set forth
opposite its name below:
<TABLE>
<CAPTION>
PRINCIPAL AMOUNT
UNDERWRITER OF NOTES
----------- ----------------
<S> <C>
Bear, Stearns & Co. Inc..................................... $
Merrill Lynch, Pierce, Fenner & Smith Incorporated .........
Salomon Brothers Inc........................................
Rauscher Pierce Refsnes, Inc................................
------------
Total..................................................... $150,000,000
============
</TABLE>
Under the terms and conditions of the Underwriting Agreement and the
applicable Terms Agreement, the Underwriters are obligated to take and pay for
all of the Notes, if any are taken.
The Underwriters propose to offer the Notes in part directly to the public
at the initial public offering price set forth on the cover page of this
Prospectus Supplement, and in part to certain securities dealers at such price
less a concession of % of the principal amount of the Notes. The Underwriters
may allow, and such dealers may reallow, a concession not in excess of % of
the principal amount of the Notes to certain brokers and dealers.
After the Notes are released for sale to the public, the offering price and
other selling terms may from time to time be varied by the Representatives.
The Notes are a new issue of securities with no established trading market.
The Company has been advised by the Underwriters that they currently intend to
make a market in the Notes, although the Underwriters are not obligated to do
so and may discontinue such market making at any time without notice.
Accordingly, no assurance can be given as to the liquidity of, or the trading
market for, the Notes.
In order to facilitate the offering, certain persons participating in the
offering may engage in transactions that stabilize, maintain or otherwise
affect the price of the Notes during and after the offering. Specifically, the
Underwriters may over-allot or otherwise create a short position in the Notes
for their own account by selling more Notes than have been sold to them by the
Company. The Underwriters may elect to cover any such short position by
purchasing Notes in the open market. In addition, such persons may stabilize
or maintain the price of the Notes by bidding for or purchasing Notes in the
open market and may impose penalty bids, under which selling concessions
allowed to syndicate members or other broker-dealers participating in the
offering are reclaimed if Notes previously distributed in the offering are
repurchased in connection with stabilization transactions or otherwise. The
effect of these transactions may be to stabilize or maintain the market price
of the Notes at a level above that which might otherwise prevail in the open
market. The imposition of a penalty bid may also affect the price of the Notes
to the extent that it discourages resales thereof. No representation is made
as to the magnitude or effect of any such stabilization or other transactions.
Such transactions, if commenced, may be discontinued at any time.
In the ordinary course of their respective businesses, certain of the
Underwriters and their affiliates have provided, and may in the future
provide, investment banking services to the Company and certain of its
affiliates.
The Company has agreed to indemnify the Underwriters against certain
liabilities, including liabilities under the Securities Act of 1933, as
amended.
S-11
<PAGE>
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
+INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A +
+REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE +
+SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY +
+OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT +
+BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR +
+THE SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE +
+SECURITIES IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE +
+UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF +
+ANY STATE. +
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
SUBJECT TO COMPLETION, DATED JULY 31, 1997
PROSPECTUS
TANDY CORPORATION
DEBT SECURITIES
Tandy Corporation ("Tandy" or the "Company") may offer from time to time in
one or more series its debt securities (the "Debt Securities") having an
aggregate initial public offering price or purchase price of up to U.S.
$300,000,000, or the equivalent thereof in one or more foreign currencies or
composite currencies, including European Currency Units ("ECU"), each series of
which will be offered on terms to be determined at the time of sale. Debt
Securities may be sold for U.S. dollars, or for one or more foreign or
composite currencies, and the principal of (and premium, if any) and any
interest on any Debt Securities may likewise be payable in U.S. dollars or in
one or more foreign or composite currencies.
Debt Securities of a series may be issuable as individual securities in
registered form without coupons or as one or more global securities in
registered form (each a "Global Security").
The terms of the Debt Securities, including, where applicable, the specific
designation, aggregate principal amount, currency, denominations, maturity,
premium, rate (which may be fixed or floating) and time of payment of interest,
terms for redemption at the option of the Company or the holder, terms for
sinking fund payments, the initial public offering price and other terms in
connection with the offering and sale of the Debt Securities in respect of
which this Prospectus is being delivered are set forth in the accompanying
Prospectus Supplement (the "Prospectus Supplement").
-----------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY
IS A CRIMINAL OFFENSE
-----------
The Debt Securities may be sold through underwriting syndicates represented
by managing underwriters, by underwriters without a syndicate, through agents
designated from time to time, or directly to institutional purchasers. Any such
managing underwriters, underwriters or agents may include Bear, Stearns & Co.
Inc., Merrill Lynch & Co., Salomon Brothers Inc and Rauscher Pierce Refsnes,
Inc. The names of any underwriters or agents of the Company involved in the
sale of the Debt Securities in respect of which this Prospectus is being
delivered and any applicable commissions or discounts are set forth in the
Prospectus Supplement. The net proceeds to the Company from such sale are also
set forth in the Prospectus Supplement.
The date of this Prospectus is August , 1997.
<PAGE>
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance
therewith files reports and other information with the Securities and Exchange
Commission (the "Commission"). Such reports and other information can be
accessed through the Commission's web site at (http://www.sec.gov) and also can
be inspected and copied at the public reference facilities maintained by the
Commission at Room 1024, Judiciary Plaza, N.W. Washington, D.C. 20549 and at
the following regional offices: Citicorp 500 W. Madison, Suite 1400, Chicago,
Illinois 60611 and Seven World Trade Center, 13th Floor, New York, New York
10048. Copies of such material can be obtained from the Public Reference
Section of the Commission at 450 Fifth Street, N.W, Washington, D.C. 20549 at
prescribed rates. Reports and other information concerning the Company also can
be inspected at the offices of the New York Stock Exchange, 20 Broad Street,
New York, New York 10005.
The Company has filed with the Commission a registration statement on Form S-
3 (File No. 333-27297; together with all amendments and exhibits, the
"Registration Statement") under the Securities Act of 1933, as amended. This
Prospectus does not contain all the information set forth in the Registration
Statement, certain parts of which are omitted in accordance with the rules and
regulations of the Commission. For further information, reference is hereby
made to the Registration Statement.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
Incorporated herein by reference (File No. 1-5571) is the Company's Annual
Report on Form 10-K for the fiscal year ended December 31, 1996, the Company's
Current Report on Form 8-K filed on January 22, 1997 and the Company's
Quarterly Report on Form 10-Q for the quarterly period ended March 31, 1997 and
the Company's Current Report on Form 8-K filed on July 21, 1997.
All documents filed by the Company pursuant to Sections 13(a), 13(c), 14 or
15(d) of the Exchange Act after the date hereof and prior to the termination of
the offering of the Debt Securities shall be deemed to be incorporated by
reference in this Prospectus and made a part hereof from the date of filing of
such documents. Any statement contained in a document incorporated or deemed to
be incorporated by reference in this Prospectus shall be deemed to be modified
or superseded for purposes of this Prospectus to the extent that a statement
contained herein or in any other subsequently filed document which also is or
is deemed to be incorporated by reference herein or in the accompanying
Prospectus Supplement modifies or supersedes such statement. Any such statement
so modified or superseded shall not be deemed, except as so modified or
superseded, to constitute a part of this Prospectus.
THE COMPANY WILL PROVIDE WITHOUT CHARGE TO EACH PERSON, INCLUDING ANY
BENEFICIAL OWNER, TO WHOM A PROSPECTUS IS DELIVERED, UPON WRITTEN OR ORAL
REQUEST OF SUCH PERSON, A COPY OF ANY OR ALL OF THE DOCUMENTS INCORPORATED
HEREIN BY REFERENCE (OTHER THAN EXHIBITS TO SUCH DOCUMENTS THAT ARE NOT
SPECIFICALLY INCORPORATED BY REFERENCE IN SUCH DOCUMENTS). WRITTEN REQUESTS
SHOULD BE DIRECTED TO THE CORPORATE SECRETARY, TANDY CORPORATION, 100
THROCKMORTON STREET, SUITE 1800, FORT WORTH, TEXAS 76102. TELEPHONE REQUESTS
MAY BE DIRECTED TO (817) 390-3021.
2
<PAGE>
THE COMPANY
Tandy is a leading marketer of consumer electronics with a broad retail
distribution system. The Company is engaged in marketing products in such
diverse technologies as audio, video, telephony and personal computers. Tandy
markets its products primarily in the United States. The retail distribution
system is comprised of the RadioShack and Computer City store chains.
RadioShack distributes primarily private label electronic parts and
accessories, audio/visual equipment, digital satellite systems, personal
computers, cellular and conventional telephones, as well as specialized
products such as scanners, electronic toys and hard-to-find batteries. The
Computer City chain operates primarily as a "supercenter" format featuring
many name brand computers, software and related products.
Tandy's principal executive offices are located at 100 Throckmorton Street,
Suite 1800, Fort Worth, Texas 76102. Tandy's mailing address is 100
Throckmorton Street, Suite 1800, P.O. Box 17180, Fort Worth, Texas 76102 and
its telephone number is (817) 390-3700.
USE OF PROCEEDS
Except as may be stated otherwise in the applicable Prospectus Supplement,
the net proceeds to be received by the Company from the sale of Debt
Securities will be added to its general corporate funds and may be used to
reduce long-term or short-term borrowings, for acquisitions or for other
business opportunities. Although the Company regularly evaluates the
advisability of making business acquisitions or investments, it currently has
no understandings or agreements for any specific acquisition or investment.
RATIOS OF EARNINGS TO FIXED CHARGES
The ratios of earnings to fixed charges of the Company on a consolidated
basis for the periods indicated were as follows:
<TABLE>
<CAPTION>
THREE MONTHS SIX MONTHS YEAR
ENDED YEAR ENDED DECEMBER ENDED ENDED
MARCH 31, 31, DECEMBER 31,(1) JUNE 30,
------------- ------------------- --------------- --------
1997 1996 1996 1995 1994 1993 1992 1992
------ ------ ---- ---- ---- ---- --------------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Ratio of earnings to
fixed charges.......... 2.47 1.85 (2) 4.22 4.56 3.89 2.83 3.95
</TABLE>
- --------
(1) In 1992, the Company changed its fiscal year end from June 30 to December
31 effective with the six-month transition period ended December 31, 1992.
(2) Earnings before income taxes were not sufficient to cover fixed charges
during 1996 by approximately $145.6 million.
For purposes of calculating the ratio of earnings to fixed charges,
"earnings" consist of income before income taxes plus fixed charges. "Fixed
charges" consist of interest expense, amortization of debt issuance expenses
and discount and an appropriate portion of rental expense that represents a
reasonable approximation of the interest factor (currently deemed to be one
third).
3
<PAGE>
DESCRIPTION OF DEBT SECURITIES
The following description of the terms of the Debt Securities sets forth
certain general terms and provisions of the Debt Securities offered by any
Prospectus Supplement and the extent, if any, to which such general provisions
may apply to the Debt Securities so offered will be described in the
Prospectus Supplement relating to such Debt Securities.
The Debt Securities are to be issued under an Indenture dated as of May 1,
1997 between the Company and The Chase Manhattan Bank, as trustee (the
"Trustee"), as supplemented from time to time by supplemental indentures
and/or modified from time to time by resolutions of the Board of Directors of
the Company as provided in Section 301 of such indenture (such indenture as so
supplemented and/or modified being hereinafter referred to as the
"Indenture"). A copy of the form of Indenture has been filed as an exhibit to
the Registration Statement. The following summaries of certain provisions of
the Indenture and the Debt Securities are not complete and are qualified in
their entirety by reference to the provisions of the Indenture. Numerical
references in parentheses are to sections in the Indenture, and unless
otherwise indicated capitalized terms have the meanings given them in the
Indenture.
GENERAL
The Indenture does not limit the aggregate principal amount of Debt
Securities that may be issued from time to time in series. (Section 301)
The Debt Securities will be unsecured obligations of the Company and will
rank on a parity with all other unsecured and unsubordinated indebtedness of
the Company.
The Indenture does not contain any covenants or provisions that would afford
debt holders protection in the event of a highly leveraged transaction.
The Indenture does not contain any covenants or provisions that would afford
holders of Debt Securities protection in the event of a change in control of
the Company.
Reference is made to the Prospectus Supplement relating to the particular
series of Debt Securities offered thereby for a description of the terms of
such Debt Securities in respect of which this Prospectus is being delivered,
including, where applicable: (i) the title of such Debt Securities; (ii) any
limit on the aggregate principal amount of such Debt Securities; (iii) the
price (expressed as a percentage of the aggregate principal amount thereof) at
which such Debt Securities will be issued; (iv) the date or dates on which the
principal of such Debt Securities is payable; (v) the currency of denomination
of such Debt Securities, which may be U. S. dollars or any other currency or
any composite currency, including ECU; (vi) the designation of the currency or
currencies in which payment of the principal of (and premium, if any) and any
interest on such Debt Securities will be made, and the designation, if any of
the currency or currencies in which payment of the principal of (and premium,
if any) or any interest on such Debt Securities, at the election of a Holder
thereof, may also be payable; (vii) if the amount of payments of principal of
(and premium, if any) or interest on the Debt Securities of the series may be
determined with reference to an index based on a currency or currencies other
than that in which the Debt Securities are denominated or designated to be
payable, the manner in which such amounts shall be determined; (viii) if the
payments of principal of (and premium, if any) or interest on the Debt
Securities of the series are to be made in a Foreign Currency other than the
Foreign Currency in which such Debt Securities are denominated, the manner in
which the exchange rate with respect to such payments shall be determined;
(ix) if the Debt Securities of such series are to be denominated or payable in
a currency other than dollars, the designation of the initial Exchange Rate
Agent; (x) the rate or rates (which may be fixed or floating), if any, at
which such Debt Securities will bear interest, the date or dates from which
such interest will accrue, the dates on which such interest will be payable,
and the record date for the interest payable on any interest payment date;
(xi) whether such Debt Securities are to be issued in whole or in part in the
form of one or more Global Securities and, if so, the identity of the
Depositary (as defined below) for such Global Security or Securities; (xii)
the terms and conditions, if any, on which such Debt Securities may be
redeemed by the Company; (xiii) the obligation, if any, of the Company to
redeem, repay or purchase such Debt Securities pursuant to any sinking fund or
at the option of a Holder thereof, and the terms and conditions on which such
Debt Securities shall be redeemed, repaid
4
<PAGE>
or purchased pursuant to such obligation; (xiv) any additional Events of
Default or restrictive covenants provided for with respect to such Debt
Securities; (xv) if other than denominations of $1,000 and any integral
multiple thereof, the denominations in which Debt Securities of the series
shall be issuable; (xvi) the place or places, if any, in addition to or other
than the office or agency of the Company in the Borough of Manhattan, the City
and State of New York, where the principal of (and premium, if any) and
interest on Debt Securities of the series shall be payable; (xvii) if other
than the principal amount thereof, the portion of the principal amount of Debt
Securities of the series which shall be payable upon declaration of
acceleration of the maturity thereof; (xviii) provisions, if any, for the
defeasance of Debt Securities of the series; and (xix) any other terms not
inconsistent with the Indenture, including any terms which may be required by
or advisable under United States laws or regulations or advisable in
connection with the marketing of such Debt Securities. (Section 301)
Unless otherwise indicated in the Prospectus Supplement, the Debt Securities
will be issued only in fully registered form without coupons or in the form of
one or more Global Securities, as described below under "Global Securities."
Debt Securities will be issued in denominations of $1,000 or any integral
multiple thereof unless otherwise provided in the applicable Prospectus
Supplement. (Section 302) The Prospectus Supplement relating to a series of
Debt Securities denominated in a composite currency or any currency other than
U. S. dollars will specify the denominations thereof.
One or more series of Debt Securities may be sold at a substantial discount
below their stated principal amount, bearing no interest or interest at a rate
which at the time of issuance is below market rates. One or more series of
Debt Securities may be floating rate debt securities which are exchangeable
for fixed rate debt securities. Federal income tax consequences and special
considerations applicable to any such series will be described in the
Prospectus Supplement relating thereto.
The principal of (and premium, if any) and any interest on Debt Securities
shall be payable at the Place or Places of Payment designated for such Debt
Securities, provided that payment of interest on registered Debt Securities
may be made at the option of the Company by check mailed to the registered
Holders thereof or, if so provided in the applicable Prospectus Supplement, at
the option of the Holder by wire transfer to an account designated by such
Holder in writing to the Trustee. (Sections 307 and 1002)
Debt Securities (other than Global Securities) may be presented for
exchange, and registered Debt Securities may be presented for transfer, in the
manner, at the places, and subject to the restrictions set forth in the
Indenture and the Debt Securities and described in the applicable Prospectus
Supplement. No service charge will be made for any transfer or exchange of the
Debt Securities, but the Company may require payment of a sum sufficient to
cover any tax or other governmental charge payable in connection therewith.
(Section 305)
GLOBAL SECURITIES
The Debt Securities of a series may be issued in whole or in part in the
form of one or more fully registered Global Securities that will be deposited
with, or on behalf of, a depositary (the "Depositary") identified in the
Prospectus Supplement relating to such series. Unless and until it is
exchanged in whole or in part for Debt Securities in definitive registered
form, a Global Security may not be transferred except as a whole by the
Depositary for such Global Security to a nominee of such Depositary or by a
nominee of such Depositary to such Depositary or another nominee of such
Depositary or by such Depositary or any such nominee to a successor of such
Depositary or a nominee of such successor. (Sections 303 and 305)
The specific terms of the Depositary arrangement with respect to any Debt
Securities of a series will be described in the Prospectus Supplement relating
to such series. The Company anticipates that the following provisions will
apply to all Depositary arrangements.
Upon the issuance of a Global Security, the Depositary for such Global
Security will credit, on its book-entry registration and transfer system, the
respective principal amounts of the Debt Securities represented by such Global
Security to the accounts of persons that have accounts with such Depositary
("participants"). The
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accounts to be credited shall be designated by the underwriters or agents with
respect to such Debt Securities or by the Company if such Debt Securities are
offered and sold directly by the Company. Ownership of beneficial interests in
a Global Security will be limited to participants or persons that may hold
interests through participants. Ownership of participant's interests in a
Global Security will be shown on, and the transfer of that ownership will be
effected only through, records maintained by the Depositary for such Global
Security. Ownership of beneficial interests in a Global Security will be shown
on, and the transfer of that ownership will be effected only through, records
maintained by participants or persons that hold through participants. The laws
of some states require that certain purchasers of securities take physical
delivery of such securities in definitive form. Such limits and such laws may
impair the ability to transfer beneficial interests in a Global Security.
So long as the Depositary for a Global Security, or its nominee, is the
registered owner of such Global Security, such Depositary or such nominee, as
the case may be, will be considered the sole owner or holder of the Debt
Securities represented by such Global Security for all purposes under the
Indenture. Except as set forth below, owners of beneficial interests in a
Global Security will not be entitled to have Debt Securities of the series
represented by such Global Security registered in their names, will not
receive or be entitled to receive physical delivery of Debt Securities of such
series in definitive form and will not be considered the owners or holders
thereof under the Indenture.
Principal, premium, if any, and any interest payments on Debt Securities
registered in the name of a Depositary or its nominee will be made to the
Depositary or its nominee, as the case may be, as the registered owner of a
Global Security representing such Debt Securities. None of the Company, the
Trustee, any Paying Agent or the Security Registrar for such Debt Securities
will have any responsibility or liability for any aspect of the records
relating to or payments made on account of beneficial ownership interests in
the Global Security or Securities for such Debt Securities or for maintaining,
supervising or reviewing any records relating to such beneficial ownership
interests. (Section 308)
The Company expects that the Depositary for a series of Debt Securities,
upon receipt of any payment of principal, premium or interest, will credit
immediately participants' accounts with payments in amounts proportionate to
their respective beneficial interests in the principal amount of the Global
Security or Securities for such Debt Securities as shown on the records of
such Depositary. The Company also expects that payments by participants to
owners of beneficial interests in such Global Security or Securities held
through such participants will be governed by standing instructions and
customary practices, as is now the case with securities held for the accounts
of customers in bearer form or registered in "street name," and will be the
responsibility of such participants.
If a Depositary for a series of Debt Securities is at any time unwilling or
unable to continue as Depositary and a successor Depositary is not appointed
by the Company within ninety days, the Company will issue Debt Securities of
such series in definitive form in exchange for the Global Security or
Securities representing such series of Securities. In addition, the Company
may at any time and in its sole discretion determine not to have the Debt
Securities of a series represented by one or more Global Securities and, in
such event, will issue Debt Securities of such series in definitive form in
exchange for the Global Security or Securities representing such series of
Debt Securities. (Section 305)
Further, if the Company so specifies with respect to the Debt Securities of
a series, an owner of a beneficial interest in a Global Security representing
Debt Securities of such series may, on terms acceptable to the Company,
receive Debt Securities of such series in definitive form. In any such
instance, an owner of a beneficial interest in a Global Security will be
entitled to have Debt Securities of the series represented by such Global
Security equal in principal amount to such beneficial interest registered in
its name and will be entitled to physical delivery of such Debt Securities in
definitive form. Debt Securities of such series so issued in definitive form
will, except as set forth in the applicable Prospectus Supplement, be issued
in denominations of $1,000 and integral multiples thereof and will be issued
in registered form only without coupons. (Sections 302 and 305)
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RESTRICTIVE COVENANTS
Limitation on Liens. The Indenture provides that the Company may not, and
may not permit any Subsidiary to, create, incur, assume or suffer to exist any
Lien upon any Operating Property or Operating Asset, whether owned at the date
of the Indenture or thereafter acquired, to secure any Indebtedness, without
making effective provision whereby the Debt Securities of each series then
Outstanding (together with, if the Company shall so determine, any other
Indebtedness of the Company or any Subsidiary then existing or thereafter
created which is not subordinate to the Debt Securities of each series then
Outstanding) shall be secured by such Lien equally and ratably with (or prior
to) any and all other Indebtedness thereby secured, so long as such
Indebtedness shall be so secured, unless, after giving effect thereto, the
aggregate amount of all such Indebtedness secured by Liens, together with all
Attributable Debt of the Company and its Subsidiaries in respect of Sale and
Lease-Back Transactions (other than Sale and Lease-Back Transactions permitted
by clauses (2), (3) and (4) under "Limitation on Sales and Lease-Backs" below)
would not exceed the greater of (i) 10% of Consolidated Net Tangible Assets of
the Company or (ii) $140,000,000; provided, however, that the foregoing
restriction shall not apply to Indebtedness secured solely by: (i) Liens on
any property existing at the time of acquisition thereof by the Company or a
Subsidiary (subject to certain limitations); (ii) Liens on property of a
corporation existing at the time such corporation is merged into or
consolidated with the Company or a Subsidiary or otherwise becomes a
Subsidiary of the Company or at the time of a sale, lease or other disposition
of the properties of such corporation (or a division thereof) as an entirety
or substantially as an entirety to the Company or a Subsidiary (subject to
certain limitations); (iii) Liens securing Indebtedness of a wholly-owned
Subsidiary to the Company or to another wholly-owned Subsidiary; (iv) Liens on
property to secure all or part of the cost of acquiring, substantially
repairing or altering, constructing, developing or substantially improving
such property, or to secure Indebtedness incurred to provide funds for any
such purpose (subject to certain limitations); (v) Liens in favor of the
United States of America or any State thereof, or any department, agency or
instrumentality or political subdivision of the United States of America or
any state thereof, to secure partial progress, advance or other payments
pursuant to any contract or statute or to secure any indebtedness incurred for
the purpose of financing all or any part of the purchase price or the cost of
constructing or improving the property subject to such Liens; (vi) Liens
incurred or assumed in connection with an issuance of revenue bonds the
interest on which is exempt from federal income tax pursuant to Section 103
and related Sections of the Internal Revenue Code of 1986, as amended; (vii)
Liens on customer and other accounts receivable owned by the Company or any
Subsidiary; and (viii) any extension, renewal or replacement (or successive
extensions, renewals or replacements), in whole or in part, of any Lien
referred to in the foregoing clauses (i) to (vii), inclusive, subject to
certain limitations. (Section 1008)
Limitation on Sales and Lease-Backs. The Indenture provides that the Company
may not, nor may it permit any Subsidiary to, enter into any Sale and Lease-
Back Transactions with respect to any Operating Property or Operating Asset
more than 360 days after the later of (i) the completion of the acquisition,
substantial repair or alteration, construction, development or substantial
improvement of such Operating Property or Operating Asset; (ii) the placing in
operation of such Operating Property or Operating Asset or (iii) the placing
in operation of such Operating Property or Operating Asset as so substantially
repaired or altered, constructed, developed or substantially improved. This
covenant shall not apply to any Sale and Lease-Back Transaction with respect
to any Operating Property or Operating Asset (1) if the Company or such
Subsidiary could issue, assume or guarantee Indebtedness secured by a Lien on
the property to be leased back in an amount equal to the Attributable Debt
with respect to such Sale and Lease-Back Transaction without equally and
ratably securing the Outstanding Debt Securities of each series; (2) solely
between the Company and a wholly-owned Subsidiary or between wholly-owned
Subsidiaries of the Company; (3) if the terms of such Sale and Lease-Back
Transaction have been determined by the Company's Board of Directors to be
fair and arms' length and, within 360 days after the receipt of the proceeds
of such Sale and Lease-Back Transaction, the Company or any of its
Subsidiaries applies an amount equal to the greater of the net proceeds of
such Sale and Lease-Back Transaction or the fair value of such Operating
Property or Operating Asset at the time of such Sale and Lease-Back
Transaction to (x) the prepayment or retirement (other than any mandatory
prepayment or retirement) of Indebtedness not then due within one year of the
Company or any of its Subsidiaries (other than Indebtedness of a wholly-owned
Subsidiary
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to the Company or to another wholly-owned Subsidiary) or (y) the making of
capital expenditures incurred to purchase, construct or improve property used
in ordinary course of business of the Company or any of its Subsidiaries; or
(4) to the extent the Company transfers or sells all or part of its nine block
corporate headquarters complex and parking lots in existence on the date of
the Indenture, and any additions thereto, or all or part of any of its 12
regional distribution centers in existence on the date of the Indenture, and
any additions thereto, in a transaction (including but not limited to the
formation of a partnership) in which the Company (x) receives an interest
equal in value (as determined in good faith by the Board of Directors and set
forth in an Officers' Certificate delivered to the Trustee) to the value of
any property so transferred or sold and (y) enters into a lease providing the
Company with the continued use of such property. (Section 1007)
Certain Definitions. "Attributable Debt" means, as to any particular lease
under which the Company or a Subsidiary is at the time liable, at any date as
of which the amount thereof is to be determined, the total net amount of rent
required to be paid by such Person under such lease during the remaining term
thereof, discounted from the respective due dates thereof to such date at the
rate of 10% per annum compounded annually. The net amount of rent required to
be paid under any such lease for any such period shall be the amount of the
rent payable by the lessee with respect to such period, after excluding
amounts required to be paid on account of maintenance and repairs, insurance,
taxes, assessments, water rates and similar charges.
"Consolidated Net Tangible Assets" means the total of all the assets
appearing on the consolidated balance sheet of the Company and its
Subsidiaries, less the following: (i) current liabilities, including
liabilities for indebtedness maturing more than 12 months from the date of the
original creation thereof but maturing within 12 months from the date of
determination; (ii) reserves for depreciation and other asset valuation
reserves; and (iii) intangible assets including, but without limitation, such
items as goodwill, trademarks, trade names, patents and unamortized debt
discount and expense carried as an asset on said balance sheet.
"Indebtedness" means with respect to any Person, at any time, without
duplication, (i) all obligations of such Person for borrowed money, (ii) all
obligations of such Person evidenced by bonds, debentures, notes or other
similar instruments, (iii) all obligations of such Person upon which interest
charges are customarily paid (other than accounts payable incurred in the
ordinary course of business), (iv) all obligations of such Person under
conditional sale or other title retention agreements relating to property
purchased by such Person, (v) all obligations of such Person issued or assumed
as the deferred purchase price of property (other than accounts payable
incurred in the ordinary course of business), (vi) all Capital Lease
Obligations of such Person, (vii) all Indebtedness of others secured by (or
for which the Holder of such Indebtedness has an existing right, contingent or
otherwise, to be secured by) any Lien or security interest on property owned
or acquired by such Person, whether or not the obligations secured thereby
have been assumed, and (viii) all obligations of such Person in respect of any
letters of credit supporting any Indebtedness of others and guarantees by such
Person of Indebtedness of others.
"Lien" means any mortgage, pledge, hypothecation, assignment, deposit
arrangement, encumbrance, security interest, lien (statutory or other), or
preference, priority or other security or similar agreement or preferential
arrangement of any kind or nature whatsoever (including, without limitation,
any conditional sale or other title retention agreement having substantially
the same economic effect as any of the foregoing).
"Operating Assets" means all merchandise inventories, furniture, fixtures
and equipment (including all transportation and warehousing equipment but
excluding office equipment and data processing equipment) owned by the Company
or any of its Subsidiaries.
"Operating Property" means all real property and improvements thereon owned
by the Company or any of its Subsidiaries constituting, without limitation,
any store, warehouse, service center or distribution center wherever located,
provided that such term shall not include any store, warehouse, service center
or distribution center that the Company's Board of Directors declares by
resolution not to be of material importance to the business of the Company and
its Subsidiaries.
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"Sale and Lease-Back Transaction" of the Company or a Subsidiary means any
arrangement whereby (i) property has been or is to be sold or transferred by
the Company or a Subsidiary to any Person with the intention on the part of
the Company or such Subsidiary of taking back a lease of such property
pursuant to which the rental payments are calculated to amortize the purchase
price of such property substantially over the useful life of such property and
(ii) such property is in fact so leased by the Company or such Subsidiary.
"Subsidiary" means any corporation of which a majority of the outstanding
capital stock having ordinary voting power to elect a majority of the board of
directors of such corporation (irrespective of whether or not at the time
capital stock of any other class or classes of such corporation shall or might
have voting power upon the occurrence of any contingency) is at the time
directly or indirectly owned by the Company, by the Company and one or more
other Subsidiaries or by one or more Subsidiaries of the Company, and general
partnership, joint venture or similar entity, of which a majority of the
outstanding partnership or similar interests is at the time directly or
indirectly owned by the Company, or by one or more other Subsidiaries, or by
the Company and one or more other Subsidiaries, and any limited partnership of
which the Company or any other Subsidiary is a general partner.
EVENTS OF DEFAULT
The Indenture provides that the following shall constitute Events of Default
with respect to any series of Debt Securities thereunder: (i) default in
payment of principal of (or premium, if any, on) any Debt Security of such
series when due; (ii) default for 30 days in payment of interest on any Debt
Security of such series from when due; (iii) default in the deposit of any
sinking fund payment on any Debt Security of such series when due; (iv)
default in the performance or breach of any other covenant in the Indenture,
which default continues for 60 days after written notice thereof by the
Trustee or the Holders of at least 25% in principal amount of the Outstanding
Debt Securities of such series; (v) default resulting in acceleration of
maturity of any other indebtedness of the Company or any Subsidiary in an
amount in excess of $20,000,000, which acceleration is not rescinded or
annulled for 10 days after written notice thereof by the Trustee or the
Holders of at least 25% in principal amount of the Outstanding Debt Securities
of such series; (vi) certain events of bankruptcy, insolvency or
reorganization and (vii) any other Event of Default provided with respect to
Debt Securities of that series. (Section 501) No Event of Default with respect
to a particular series of Debt Securities issued under the Indenture
necessarily constitutes an Event of Default with respect to any other series
of Debt Securities issued thereunder.
The Indenture provides that if an Event of Default specified therein shall
occur and be continuing, either the Trustee or the Holders of at least 25% in
principal amount of the Outstanding Debt Securities of such series may declare
the principal of all such Debt Securities (or in the case of Original Issue
Discount Securities, such portion of the principal amount thereof as may be
specified in the terms thereof) to be due and payable immediately. In certain
cases, the Holders of a majority in principal amount of the outstanding Debt
Securities of any series may on behalf of the Holders of all such Debt
Securities rescind and annul such declaration of acceleration. (Section 502)
The Indenture contains a provision entitling the Trustee, subject to the
duty of the Trustee during a default to act with the required standard of
care, to be indemnified by the Holders of the Debt Securities of any series
before proceeding to exercise any right or power under the Indenture with
respect to such series at the request of such Holders. (Section 603) The
Indenture provides that no Holder of Debt Securities of any series may
institute any proceedings, judicial or otherwise, to enforce the Indenture
except in the case of failure of the Trustee thereunder, for 60 days, to act
after it has received a request to enforce such Indenture by the Holders of at
least 25% in aggregate principal amount of the then Outstanding Debt
Securities of such series, and an offer of reasonable indemnity. (Section 507)
This provision will not prevent any Holder of Debt Securities from enforcing
payment of the principal thereof (and premium, if any) and interest thereon at
the respective due dates thereof. (Section 508) The Holders of a majority in
aggregate principal amount of the Debt Securities of any series then
outstanding may direct the time, method and place of conducting any proceeding
for any remedy available to the Trustee or exercising any trust or power
conferred on it with respect to the Debt Securities of
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such series. The Trustee may, however, refuse to follow any direction that it
determines may not lawfully be taken or would be illegal or in conflict with
the Indenture or involve it in personal liability or which would be unjustly
prejudicial to Holders not joining therein. (Section 512)
The Indenture provides that the Trustee will, within 90 days after the
occurrence of a default with respect to any series of Debt Securities
thereunder, give to the Holders of Debt Securities of such series notice of
such default, if such default has not been cured or waived. Except in the case
of a default in the payment of principal of (or premium, if any) or interest
on, or in the payment of any sinking fund installment in respect of, any Debt
Securities of such series, the Trustee shall be protected in withholding such
notice if it determines in good faith that the withholding of such notice is
in the interest of the Holders of the Debt Securities of such series. (Section
602)
The Company will be required to file with the Trustee annually an Officers'
Certificate as to the absence of certain defaults under the terms of the
Indenture. (Section 1009)
MODIFICATION AND WAIVER
Modifications of and amendments to the Indenture may be made by the Company
and the Trustee with the consent of the Holders of a majority in principal
amount of the outstanding Debt Securities of each series affected by such
modification or amendment; provided, however, that no such modification or
amendment may, without the consent of the Holder of each Outstanding Debt
Security affected thereby: (i) change the Stated Maturity of the principal of,
or any installment of interest on, any Debt Security, (ii) reduce the
principal amount of, or any premium or interest on, any Debt Security (or
reduce the amount of the principal of an Original Issue Discount Security that
would be due and payable upon a declaration of acceleration of the maturity
thereof); (iii) adversely affect the right of repayment or repurchase, if any,
at the option of the Holder; (iv) reduce the amount of, or postpone the date
fixed for, any payment under any sinking fund or analogous provisions for any
Debt Security; (v) change the place or currency or currency unit of payment of
the principal of (or premium, if any) or any interest on any Debt Security;
(vi) change or eliminate the rights of a Holder to receive payment in a
designated currency; (vii) impair the right to institute suit for the
enforcement of any payment on or with respect to any Debt Security; or (viii)
reduce the percentage of the principal amount of the outstanding Debt
Securities of any series the consent of whose Holders is required for
modification or amendment of the Indenture, for waiver of compliance with
certain provisions of the Indenture or for waiver of certain defaults.
(Section 902)
The Holders of a majority in principal amount of the outstanding Debt
Securities of each series may, on behalf of all Holders of Debt Securities of
that series, waive, insofar as that series is concerned, compliance by the
Company with the provisions of the Indenture described above in "Restrictive
Covenants" before the time for such compliance. (Section 1010) The Holders of
a majority in principal amount of the outstanding Debt Securities of each
series may, on behalf of all Holders of Debt Securities of that series, waive
any past default under the Indenture with respect to Debt Securities of that
series except a default in the payment of the principal of (or premium, if
any) or any interest on any Debt Security of that series and except a default
in respect of a covenant or provision the modification or amendment of which
would require the consent of the Holder of each outstanding Debt Security
affected thereby. (Section 513)
CONSOLIDATION, MERGER AND TRANSFER OF ASSETS
The Company may not consolidate with or merge into any corporation, or
transfer its assets substantially as an entirety to any Person, unless: (i)
the successor corporation or transferee assumes the Company's obligations on
the Debt Securities and under the Indenture; (ii) after giving effect to the
transaction, no Event of Default and no event which, after notice or lapse of
time, would become an Event of Default shall have occurred and be continuing;
and (iii) certain other conditions are met. (Section 801)
DEFEASANCE
If so specified in the Prospectus Supplement with respect to Debt Securities
of any series, the Company, at its option, (i) will be discharged from any and
all obligations in respect of the Debt Securities of such series
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(except for certain obligations to register the transfer or exchange of Debt
Securities of such series, replace stolen, lost or mutilated Debt Securities
of such series, maintain Paying Agencies, and hold money for payment in trust)
or (ii) will not be subject to the provisions of the Indenture described above
under "Restrictive Covenants" with respect to the Debt Securities of such
series, in each case if the Company deposits with the Trustee, in trust, money
or U.S. Government Obligations which through the payment of interest thereon
and principal thereof in accordance with their terms will provide money in an
amount sufficient to pay all the principal (including any mandatory sinking
fund payments) of, and interest on, the Outstanding Debt Securities of such
series on the dates such payments are due in accordance with the terms of such
Debt Securities. To exercise any such option, the Company is required to
deliver to the Trustee an Opinion of Counsel to the effect that (1) the
deposit and related defeasance would not cause the Holders of the Debt
Securities of such series to recognize income, gain or loss for federal income
tax purposes and, in the case of a discharge pursuant to clause (i), a ruling
to such effect received from or published by the United States Internal
Revenue Service; (2) the Company's exercise of its option under this provision
will not cause any violation of the Investment Company Act of 1940, as
amended, on the part of the Company, the trust, the trust funds representing
the Company's deposit or the Trustee; and (3) if the Debt Securities of such
series are then listed on the New York Stock Exchange, such Debt Securities
would not be delisted as a result of the exercise of such option. The Company
would also be required to deliver to the Trustee an Officer's Certificate
stating that no Event of Default or event (including such deposit) which, with
notice or lapse of time, or both, would become an Event of Default with
respect to the Debt Securities of such series has occurred and is continuing.
(Sections 1301 and 1302)
CONCERNING THE TRUSTEE
The Chase Manhattan Bank is the Trustee under the Indenture. The Chase
Manhattan Bank maintains normal banking relationships with the Company
including (i) acting as trustee under the Indenture dated as of November 15,
1990, with the Company as issuer and (ii) acting as trustee under the
Indenture dated as of June 30, 1990 with The Trust Established Under The Tandy
Employees Stock Ownership Plan as issuer and the Company as guarantor.
PLAN OF DISTRIBUTION
The Company may sell the Debt Securities in any of three ways: (i) through
underwriters or dealers; (ii) through agents; or (iii) directly to a limited
number of purchasers or to a single purchaser. The Prospectus Supplement with
respect to each series of Debt Securities will set forth the terms of the
offering of the Debt Securities of such series, including the name or names of
any underwriters, the purchase price of such Debt Securities, the proceeds to
the Company from such sale, any underwriting discounts and other items
constituting underwriters' compensation, any initial public offering price,
any discounts or concessions allowed or reallowed or paid to dealers and any
securities exchanges on which the Debt Securities of such series may be
listed.
If underwriters are used in the sale, the Debt Securities will be acquired
by the underwriters for their own account and may be resold from time to time
in one or more transactions, including negotiated transactions, at a fixed
public offering price, or at varying prices determined at the time of sale.
The Debt Securities may be offered to the public through underwriting
syndicates represented by managing underwriters or by underwriters without a
syndicate. Unless otherwise set forth in the Prospectus Supplement, the
obligations of the underwriters to purchase Debt Securities will be subject to
certain conditions precedent and the underwriters will be obligated to
purchase all the Debt Securities of a series if any are purchased. Any initial
public offering price and any discounts or concessions allowed or reallowed or
paid to dealers may be changed from time to time.
The Debt Securities may be sold directly by the Company or through agents
designated by the Company from time to time. Any agent involved in the offer
or sale of the Debt Securities in respect of which this Prospectus is
delivered will be named, and any commissions payable by the Company to such
agent will be set forth, in the Prospectus Supplement. Unless otherwise
indicated in the Prospectus Supplement, any such agent will be acting on a
best efforts basis for the period of its appointment.
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If so indicated in the Prospectus Supplement, the Company will authorize
agents, underwriters or dealers to solicit offers by certain specified
entities to purchase Debt Securities from the Company at the public offering
price set forth in the Prospectus Supplement pursuant to delayed delivery
contracts providing for payment and delivery on a specified date. Such
contracts will be subject only to those conditions set forth in the Prospectus
Supplement. The Prospectus Supplement will set forth the commissions payable
for solicitation of such contracts.
Agents and underwriters may from time to time purchase and sell Debt
Securities in the secondary market, but are not obligated to do so, and there
can be no assurance that there will be a secondary market for the Debt
Securities or liquidity in the secondary market if one develops.
Agents and underwriters may be entitled under agreements entered into with
the Company to indemnification by the Company against certain civil
liabilities, including liabilities under the Securities Act of 1933, as
amended, or to contribution with respect to payments which the agents or
underwriters may be required to make in respect thereof. Agents and
underwriters may be customers of, engage in transactions with or perform
services for the Company or its affiliates in the ordinary course of business.
EXPERTS
The financial statements incorporated in the Registration Statement and this
Prospectus by reference to the Annual Report on Form 10-K of the Company for
the fiscal year ended December 31, 1996 have been so incorporated in reliance
on the report of Price Waterhouse LLP, independent accountants, given on the
authority of said firm as experts in auditing and accounting.
LEGAL OPINIONS
The validity of the Debt Securities offered hereby will be passed on for the
Company by Satterlee Stephens Burke & Burke LLP, New York, New York, and for
any underwriters or agents by Cleary, Gottlieb, Steen & Hamilton, New York,
New York. From time to time, Cleary, Gottlieb, Steen & Hamilton provides legal
services to the Company.
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NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY REPRESEN-
TATIONS OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS SUPPLEMENT OR THE PRO-
SPECTUS, AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE
RELIED UPON AS HAVING BEEN AUTHORIZED. THIS PROSPECTUS SUPPLEMENT AND THE PRO-
SPECTUS DO NOT CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO
BUY ANY SECURITIES OTHER THAN THE SECURITIES DESCRIBED IN THIS PROSPECTUS SUP-
PLEMENT OR AN OFFER TO BUY SUCH SECURITIES IN ANY CIRCUMSTANCES IN WHICH SUCH
OFFER OR SOLICITATION IS UNLAWFUL. NEITHER THE DELIVERY OF THIS PROSPECTUS SUP-
PLEMENT OR THE PROSPECTUS NOR ANY SALE MADE HEREUNDER OR THEREUNDER SHALL, UN-
DER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THERE HAS BEEN NO CHANGE IN
THE AFFAIRS OF THE COMPANY SINCE THE DATE HEREOF OR THAT THE INFORMATION CON-
TAINED HEREIN OR THEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO THE DATE OF
SUCH INFORMATION.
---------------
TABLE OF CONTENTS
PROSPECTUS SUPPLEMENT
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Note Regarding Forward-Looking Statements.................................. S-2
The Company................................................................ S-3
Recent Developments........................................................ S-4
Use of Proceeds............................................................ S-5
Capitalization............................................................. S-6
Selected Consolidated Financial Data....................................... S-7
Description of Notes....................................................... S-9
Underwriting............................................................... S-11
PROSPECTUS
Available Information...................................................... 2
Incorporation of Certain Documents by
Reference................................................................. 2
The Company................................................................ 3
Use of Proceeds............................................................ 3
Ratios of Earnings to Fixed Charges........................................ 3
Description of Debt Securities............................................. 4
Plan of Distribution....................................................... 11
Experts.................................................................... 12
Legal Opinions............................................................. 12
</TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
$150,000,000
TANDY CORPORATION
% NOTES DUE SEPTEMBER 1, 2007
---------------
PROSPECTUS SUPPLEMENT
---------------
BEAR, STEARNS & CO. INC.
MERRILL LYNCH & CO.
SALOMON BROTHERS INC
RAUSCHER PIERCE REFSNES, INC.
August , 1997
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The following table sets forth the expenses, other than commissions,
expected to be incurred in connection with the offering described in the
Registration Statement:
<TABLE>
<CAPTION>
EXPENSE AMOUNT*
------- --------
<S> <C>
Securities and Exchange Commission registration fee.............. $ 90,910
Legal fees....................................................... 35,000
Printing and engraving expenses.................................. 11,500
Accountants' fees................................................ 35,000
Blue sky and legal investment fees and expenses.................. 2,500
Trustee and Authenticating Agent fees............................ 12,000
Rating Agency fees............................................... 97,000
Miscellaneous expenses........................................... 6,090
--------
Total.......................................................... $290,000
========
</TABLE>
- --------
*The first item is actual; the others are estimated.
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
The General Corporation Law of the State of Delaware contains, in Section
145, provisions relating to the indemnification of officers and directors.
Article 14 of the bylaws of the Company contains provisions requiring
indemnification by the Company of its directors and officers to the full
extent permitted by law. These provisions extend to expenses reasonably
incurred by the director or officer in defense or settlement of any such
action or proceeding.
The board of directors of the Company has general authority to indemnify any
officer or director against losses arising out of his or her service as such,
unless prohibited by law. The Company carries insurance to cover potential
costs of the foregoing indemnification of the Company's officers and
directors.
Reference is made to Section 6 of the form of Underwriting Agreement filed
as Exhibit 1.1 to this Registration Statement for a description of the
indemnification arrangements expected to be provided if the offering of the
securities being registered is made through underwriters.
ITEM 16. EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION OF EXHIBIT
------- ----------------------
<C> <S>
1.1 Form of Underwriting Agreement.*
4.1 Form of Indenture dated as of May 1, 1997 between the Company and The
Chase Manhattan Bank, as Trustee.*
5.1 Legal opinion of Satterlee Stephens Burke & Burke LLP.*
12.1 Statement of computation of ratios of earnings to fixed charges of the
Company (incorporated by reference from Exhibit 12 of the Company's
Annual Report on Form 10-K for the fiscal year ended December 31, 1996
and from Exhibit 12 of the Company's Quarterly Report on Form 10-Q for
the quarterly period ended March 31, 1997).
23.1 Consent of Price Waterhouse LLP, independent accountants.
23.2 Consent of Satterlee Stephens Burke & Burke LLP (included in opinion
filed as Exhibit 5).
24.1 Power of Attorney.*
25.1 Form T-1, Statement of Eligibility and Qualification of The Chase
Manhattan Bank, as Trustee, under the Indenture between the Company
and The Chase Manhattan Bank, as Trustee.*
</TABLE>
- --------
* Previously filed
II-1
<PAGE>
ITEM 17. UNDERTAKINGS.
(a) The Company hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to the Registration Statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the Registration Statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in the Registration Statement;
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the Registration Statement or
any material change to such information in the Registration Statement;
provided, however, that the undertakings set forth in clauses (i) and (ii)
above do not apply if the information required to be included in a post-
effective amendment by those clauses is contained in periodic reports filed
by the Company pursuant to Section 13 or Section 15(d) of the Securities
Exchange Act of 1934 that are incorporated by reference in the Registration
Statement.
(2) For purposes of determining any liability under the Securities Act of
1933, the information omitted from the form of prospectus filed as part of
this Registration Statement in reliance upon Rule 430A and contained in a
form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or
(4) or 497 (h) under the Securities Act shall be deemed to be part of this
Registration Statement as of the time it was declared effective.
(3) For the purpose of determining any liability under the Securities Act
of 1933, each post-effective amendment that contains a form of prospectus
shall be deemed to be a new Registration Statement relating to the
securities offered therein, and the offering of such securities at that
time shall be deemed to be the initial bona fide offering thereof.
(4) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed
to be a new Registration Statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed
to be the initial bona fide offering thereof.
(5) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
(b) The Company hereby undertakes that, for purposes of determining any
liability under the Securities Act of 1933, each filing of the Company's
annual report pursuant to Section 13 (a) or Section 15 (d) of the Securities
Exchange Act of 1934 that is incorporated by reference in the Registration
Statement shall be deemed to be a new Registration Statement relating to the
securities offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the Securities
Act of 1933, as amended, may be permitted to directors, officers and
controlling persons of the Company pursuant to the foregoing provisions, or
otherwise, the Company has been advised that in the opinion of the Securities
and Exchange Commission such indemnification is against public policy as
expressed in the Securities Act of 1933, as amended, and is, therefore,
unenforceable. In the event that a claim for indemnification against such
liabilities (other than the payment by the Company of expenses incurred or
paid by a director, officer or controlling person of the Company in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities
being registered, the Company will, unless in the opinion of its counsel the
matter has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Securities Act of 1933, as amended,
and will be governed by the final adjudication of such issue.
II-2
<PAGE>
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT
CERTIFIES THAT IT HAS REASONABLE GROUNDS TO BELIEVE THAT IT MEETS ALL OF THE
REQUIREMENTS FOR FILING ON FORM S-3 AND HAS DULY CAUSED THIS AMENDMENT NO. 2
TO THE REGISTRATION STATEMENT TO BE SIGNED ON ITS BEHALF BY THE UNDERSIGNED,
THEREUNTO DULY AUTHORIZED IN THE CITY OF FORT WORTH, STATE OF TEXAS, ON THE
31ST DAY OF JULY, 1997.
TANDY CORPORATION
By /s/ Dwain H. Hughes
-----------------------------------
DWAIN H. HUGHES,
SENIOR VICE PRESIDENT,
AND CHIEF FINANCIAL OFFICER
II-3
<PAGE>
Pursuant to the requirements of the Securities Act of 1933, as amended, this
Amendment No. 2 to the Registration Statement has been signed below by the
following persons in the capacities indicated on the 31st day of July, 1997.
SIGNATURE TITLE
* Chairman of the Board, Chief
--------------------------------- Executive Officer and
JOHN V. ROACH Director (Principal
Executive Officer)
/s/ Dwain H. Hughes Senior Vice President and
--------------------------------- Chief Financial Officer
DWAIN H. HUGHES (Principal Financial
Officer)
* Vice President and
--------------------------------- Controller (Principal
RICHARD L. RAMSEY Accounting Officer)
* Director
---------------------------------
JAMES I. CASH, JR.
* Director
---------------------------------
LEWIS F. KORNFELD, JR.
* Director
---------------------------------
JACK L. MESSMAN
* Director
---------------------------------
WILLIAM G. MORTON, JR.
* /s/ Dwain H. Hughes
---------------------------------
BY DWAIN H. HUGHES
ATTORNEY-IN-FACT-
II-4
<PAGE>
SIGNATURE TITLE
* Director
---------------------------------
THOMAS G. PLASKETT
* Director
---------------------------------
LEONARD H. ROBERTS
* Director
---------------------------------
ALFRED J. STEIN
* Director
---------------------------------
WILLIAM E. TUCKER
* Director
---------------------------------
JOHN A. WILSON
* By /s/ Dwain H. Hughes
---------------------------------
DWAIN H. HUGHES
ATTORNEY-IN-FACT
II-5
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION OF EXHIBIT
------- ----------------------
<C> <S>
1.1 Form of Underwriting Agreement.*
4.1 Form of Indenture dated as of May 1, 1997 between the Company and The
Chase Manhattan Bank, as Trustee.*
5.1 Legal opinion of Satterlee Stephens Burke & Burke LLP.*
12.1 Statement of computation of ratios of earnings to fixed charges of the
Company (incorporated by reference from Exhibit 12 of the Company's
Annual Report on Form 10-K for the fiscal year ended December 31, 1996
and from Exhibit 12 of the Company's Quarterly Report on Form 10-Q for
the quarterly period ended March 31, 1997).
23.1 Consent of Price Waterhouse LLP, independent accountants.
23.2 Consent of Satterlee Stephens Burke & Burke LLP (included in opinion
filed as Exhibit 5).
24.1 Power of Attorney.*
25.1 Form T-1, Statement of Eligibility and Qualification of The Chase
Manhattan Bank, as Trustee, under the Indenture between the Company
and The Chase Manhattan Bank, as Trustee.*
</TABLE>
- --------
* Previously filed
<PAGE>
EXHIBIT 23.1
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in the Prospectus
constituting part of this Registration Statement on Form S-3 of our report
dated February 19, 1997, except as to the treasury stock repurchase program
described in Note 11 as to which the date is March 3, 1997, appearing on page
29 of Tandy Corporation's Annual Report on Form 10-K for the year ended
December 31, 1996. We also consent to the reference to us under the heading
"Experts" in such Prospectus.
Price Waterhouse LLP
Fort Worth, Texas
July 28, 1997
