Registration No. 333-
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM S-8
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
Incorporation or Organization) Identification No.)
100 Throckmorton Street, Suite 1800 76102
Fort Worth, Texas
(Address of Principal Executive Offices) (Zip Code)
TANDY EMPLOYEES SUPPLEMENTAL STOCK PROGRAM
(Full Title of the Plan)
M. C. Hill, Vice President, Corporate Secretary and General Counsel
Tandy Corporation
100 Throckmorton Street, Suite 1900
Fort Worth, Texas 76102
(Name and Address of Agent for Service)
817-415-3924
(Telephone number, including area code, of agent for service)
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
Title of Proposed Proposed
Securities Amount Maximum Maximum Amount of
to be to be offering price aggregate Registration
Registered Registered (1)(2) per share(3) offering price Fee
<S> <C> <C> <C> <C>
Common Stock,
$1 par value 1,000,000 $56.72 $56,720,000 $16,732.40
Preferred Share
Purchase Rights
</TABLE>
(1) In addition, pursuant to Rule 416(c) under the Securities Act of 1933 this
Registration Statement also covers an indeterminate amount of plan interests to
be offered or sold pursuant to the Tandy Employees Supplemental Stock Program.
(2) If, prior to the completion of the distribution of the Common Stock covered
by this Registration Statement, additional shares of Common Stock are issued or
issuable as a result of a stock split or stock dividend, this Registration
Statement shall be deemed to cover such additional shares resulting from the
stock split or stock dividend pursuant to Rule 416.
(3) The number of shares registered has been computed on the basis of the
Issuer's estimate of the aggregate of the employee contributions to be made
under the Tandy Employees Supplemental Stock Program for a period of 36 months
following the effective date of the Registration Statement and utilized to
purchase shares of the Registrant's Common Stock at market prices from time to
time as provided in the Program. One Preferred Share Purchase Right
automatically trades with each share of Common Stock and is evidenced by the
certificate for the Common Stock. The registration fee was calculated in
accordance with Rule 457(c) upon the basis of the average of the high and low
prices of the Common Stock as reported on the New York Stock Exchange Composite
Transaction System on September 14, 1998.
INCORPORATION BY REFERENCE
This Registration Statement registers additional securities of the
Registrant of the same class (plan participations and shares of the Registrant's
Common Stock and Preferred Share Purchase Rights) as have been previously
registered on Form S-8 for the Tandy Employees Supplemental Stock Program
("SUP"). Accordingly, pursuant to General Instruction E of Form S-8, the
contents of Registration Statement on Form S-8 (File No. 33-33189) filed with
the Securities and Exchange Commission (the "Commission") and effective on
February 19, 1990, as amended by the Appendix to the prospectus dated August 29,
1990 and the contents of Registration Statement on Form S-8 (File No. 33-51599)
filed with the Commission and effective on December 20, 1993 are hereby
incorporated in their entirety by reference herein.
SIGNATURES
The Registrant. Pursuant to the requirements of the Securities Act of
1933, the Registrant certifies that it has reasonable grounds to believe that it
meets all the requirements for filing on Form S-8 and has duly caused this
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 18th day of
September, 1998.
Tandy Corporation
By: /S/John V. Roach
John V. Roach, Chairman and
Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities indicated on the 18th day of September, 1998.
Signature Title
/s/ John V. Roach Chairman of the Board and Chief Executive
John V. Roach Officer
/s/ Dwain H. Hughes Senior Vice President and Chief Financial
Dwain H. Hughes Officer
/s/ James I. Cash, Jr. Director
James I. Cash, Jr.
/s/ Ronald E. Elmquist Director
Ronald E. Elmquist
/s/ Lewis F. Kornfeld, Jr. Director
Lewis F. Kornfeld, Jr.
/s/ Jack L. Messman Director
Jack L. Messman
/s/ William G. Morton, Jr. Director
William G. Morton, Jr.
/s/ Thomas G. Plaskett Director
Thomas G. Plaskett
/s/ Leonard H. Roberts Director
Leonard H. Roberts
/s/ Alfred J. Stein Director
Alfred J. Stein
/s/ William E. Tucker Director
William E. Tucker
/s/ John A. Wilson Director
John A. Wilson
The Plan. Pursuant to the requirements of the Securities Act of 1933, the Tandy
Employees Supplemental Stock Program has duly caused this Registration Statement
to be signed on its behalf by the undersigned, thereunto duly authorized, in the
City of Fort Worth and State of Texas, on the 18th day of September, 1998.
TANDY EMPLOYEES SUPPLEMENTAL STOCK PROGRAM
ADMINISTRATIVE COMMITTEE
By: /s/C. David Christopher
C. David Christopher
By: /s/David P. Johnson
David P. Johnson
By: /s/Johnson H. Bradley
Johnson H. Bradley
INDEX TO EXHIBITS
Exhibit
No.
4.1 First Restated Trust Agreement Tandy Employees Supplemental Stock
Program.
5.1 Opinions of Messrs. Satterlee Stephens Burke & Burke LLP, as
counsel, including consent.
23.1 Consent of Pricewaterhouse Coopers LLP, Independent Accountants.
23.2 Consent of Satterlee Stephens Burke & Burke LLP, Counsel
(included in Exhibit 5.1).
FIRST RESTATED
TRUST AGREEMENT
TANDY EMPLOYEES
SUPPLEMENTAL STOCK PROGRAM
DATED JANUARY 1, 1996
(THROUGH AMENDMENT IV)
AGREEMENT made as of this 1st day of January, 1996, between Tandy
Corporation, a corporation duly organized and existing under the laws of the
State of Delaware, with its principal place of business at Fort Worth, Tarrant
County, Texas, hereinafter called "Tandy", and Bank One Texas, NA, hereinafter
called "Trustee";
WITNESSETH
THAT WHEREAS, Tandy desires to establish, on behalf of its eligible
employees, a Trust for the purposes of receiving and holding Tandy Corporation
Common Stock ("Tandy Stock") and other property and the paying of certain
benefits, as set out hereinafter, on behalf of its eligible employees who due to
benefit limitations in applicable tax laws under the Internal Revenue Code are
unable to have further contributions made on their behalf under the Tandy Fund,
formerly the Tandy Employees Deferred Salary and Investment Plan or DIP;
WHEREAS, the program provides for employee payroll deductions at a rate
up to 8% of a Participant's Earnings after the Participant has reached the
maximum Tandy Fund, formerly DIP, contribution and a Company matching
contribution equal to 80% of the Participant's payroll deduction being paid over
to Tandy and the crediting of these funds to a Participant's account, the
balance of which will be used to purchase Tandy Stock, at regular intervals at
current market prices, which Tandy Stock will be held by the Trustee until such
time as a Participant meets the withdrawal or distribution requirements set out
in the Program; and
WHEREAS, Tandy desires to designate the Trustee to hold, manage and
disburse Trust Funds.
NOW, THEREFORE, in consideration of the premises and of the promises
and covenants hereinafter contained and for the purposes herein stated, the
parties hereto do hereby agree as follows:
I
NAME, EFFECTIVE DATE AND PROGRAM YEAR
A. NAME OF TRUST: The Trust herein created, and sometimes for
convenience referred to herein as the "Program", shall be known as the
"Tandy Employees Supplemental Stock Program".
B. EFFECTIVE DATE: This Agreement shall be effective as of the 1st day
of September, 1989.
C. PROGRAM YEAR: The Program Year shall end on December 31 of each
year.
II
ADMINISTRATION
A. APPOINTMENT OF ADMINISTRATIVE COMMITTEE: The Tandy Board of
Directors shall appoint a committee to be known as the "Administrative
Committee", hereinafter referred to as the "Committee", to administer the
Program. This Committee shall consist of three or more members who shall not
necessarily be employees of Tandy. Tandy shall advise the Trustee of the names
of the members of the Committee, and the Trustee shall be entitled to rely
thereon until similarly advised of a change in the membership of the Committee.
B. TERM OF OFFICE OF COMMITTEE MEMBERS: Each member of the Committee
shall hold office until his death, disability, resignation or removal from
office. Any member of the Committee may be removed by the Tandy Board of
Directors at its pleasure. Any Committee member may resign by delivering his
written resignation to Tandy and to the Committee. Vacancies in the Committee
arising from any cause whatsoever shall be filled by the Tandy Board of
Directors.
C. POWERS AND DUTIES: The Committee shall administer the Program in
accordance with its terms and shall have all powers necessary to carry out the
provisions of the Program. Without limiting the generality of the foregoing, the
Committee shall have the following powers:
(1) To make and publish such rules and regulations as it may deem
necessary to carry out the provisions of the Program;
(2) To determine all questions arising in the administration,
interpretation and application of the Program, including questions of
eligibility of employees and the status and rights of Participants,
Beneficiaries and any other person hereunder;
(3) To deliver funds or purchase Tandy Stock for delivery to
the Trustee, as more particularly specified hereinafter;
(4) To authorize all disbursements by the Trustee from the Trust Fund;
(5) To direct the Trustee to sell Tandy Stock to Tandy or on
the open market for the purpose of funding Financial Hardship withdrawals under
the Program;
(6) To decide any dispute arising hereunder;
(7) To construe the provisions of the Program and to correct any
defects therein; and
(8) To provide procedures for the determination of claims for
benefits.
The determination of the Committee as to any questions arising
hereunder shall be conclusive and binding on all persons.
D. ORGANIZATION AND OPERATION OF THE COMMITTEE: The Committee shall act
by a majority of its members at the time in office, and such action may be taken
either by a vote at a meeting or in writing without a meeting; however, a
Committee member shall not vote on any question relating specifically to
himself, but any necessary action regarding such Committee member shall be
decided by the remaining members of the Committee. In the event the remaining
members of the Committee are unable to agree upon the disposition of any
question, the Tandy Board of Directors shall appoint another person eligible for
membership on the Committee to serve as a temporary member for the purpose of
reaching a decision on the matter in issue. Such matters shall then be
determined by a majority of the Committee, including said temporary member.
The Committee may authorize any one or more of its members to execute
any document or documents on behalf of the Committee, in which event the
Committee shall notify the Trustee in writing of such action and the name and
names of its members so designated. The Trustee thereafter shall accept and rely
upon any document executed by such member or members as representing action by
the Committee until the Committee shall file with the Trustee a written
revocation of such designation.
The Committee may adopt such bylaws and regulations as it deems
desirable for the conduct of its affairs, and may appoint such accountants,
counsel, specialists, and other persons as it deems necessary or desirable in
connection with the administration of the Program. Such accountants and counsel
may, but need not be accountants and counsel for Tandy. The Committee shall be
entitled to rely conclusively upon, and shall be fully protected in any action
taken by it in good faith in relying upon any opinions or reports which shall be
furnished to it by any such accountant, counsel, or other specialist.
The Committee and the Trustee may by agreement in writing arrange for
the Committee and/or Tandy to perform any of the Trustee's ministerial
functions, including but not limited to the maintenance of records of accounts
of each Participant, preparation and distribution of Internal Revenue Service,
Securities and Exchange Act, or Labor Department forms or documents required to
be provided to each Participant, and delivery of Tandy Stock or cash to the
Trustee.
Tandy may furnish the Committee with such clerical assistance on a full
or part time basis as shall from time to time be reasonable or desirable to
assist in the administration of the Program, and shall pay all costs and
expenses, including Trustee's fees and expenses, incurred in the administration
of the Program, save and except those specified in Section III E; and save and
except those costs and expenses, including attorneys' fees, which are charged to
the accounts of Participant's by a court of competent jurisdiction in any
litigation in which the Program or any of its fiduciaries are a party.
E. RECORDS AND REPORTS: The Committee shall keep a record of all its
proceedings and acts, and shall keep all such books of account, records, and
other data as may be necessary for the proper administration of the Program. The
Committee shall notify the Trustee and the Tandy Board of Directors of any
action taken by the Committee, and, when required, shall notify any other
interested person or persons. The Committee will specifically maintain separate
records as to each Participant's account. Within a reasonable period of time
after the end of each calendar quarter the Committee shall notify each
Participant of the total number of shares credited to his account which will
include the employee's contributions, other contributions and Company
contributions and the cost basis of said shares.
F. IMMUNITY FROM LIABILITY: No member of the Committee shall incur any
liability for any action or failure to act, excepting liability for his own
gross negligence or willful misconduct. Tandy shall indemnify each member of the
Committee against any and all claims, losses, damages, expenses and liabilities,
including any amounts paid in settlement with the Committee's approval, arising
from any action or failure to act, except when the same is judicially determined
to be due to the gross negligence or willful misconduct of such member. The
Committee may, at its discretion, require the written approval or disapproval of
Tandy prior to taking action in any particular matter made the subject of its
responsibility hereunder.
G. CONCLUSIVENESS OF DETERMINATION OF COMPANY CONTRIBUTIONS: Neither
the Trustee, Tandy nor the Committee shall be under any duty to inquire into the
correctness of the amounts contributed and paid over to Tandy by a Company in
accordance with the applicable section hereof; nor shall the Trustee, Tandy or
the Committee or any other person be under any duty to enforce the payment of
the contributions to be made under the applicable sections hereof; and the
determination by the Company of its contributions hereunder shall be final and
conclusive upon all persons.
H. REVERSION AND DIVERSION:
(1) REVERSION: Under no circumstances can a Company recover
any part of the contributions made to this Program and credited to a
Participant's account.
(2) DIVERSION: No part of the Trust Fund created by this
Program except as required to pay taxes and administrative expenses, shall be
used or diverted to purposes other than for the exclusive benefit of the
Participants or their beneficiaries or estates.
III
TRUST AND TRUSTEE
A. ESTABLISHMENT AND ACCEPTANCE OF TRUST: The Trustee shall receive any
contributions paid to it in cash or Tandy Stock. All contributions so received,
and Tandy Stock purchased therefrom, shall be known for purposes of this
Agreement as the "Trust Fund", and shall be held, managed and administered in
Trust at the request of and for the benefit of Participants pursuant to the
terms of this Agreement. The Trustee hereby accepts the Trust created hereunder
and agrees to perform the duties provided for under this Agreement.
B. POWERS OF THE TRUSTEE: The Trustee shall have all the powers granted
by the terms of Title 9 of the Property Code of the State of Texas as it now
exists, or as it may be amended, and in addition thereto and not in modification
or limitation thereof, the Trustee shall have the following powers:
(1) To invest the contributions and earnings thereon of Tandy
or Company in Tandy Stock as soon as practicable after receipt thereof, but to
hold cash temporarily uninvested without liability for interest thereon when the
investment of such cash is impracticable;
(2) To keep the Trust Fund in Tandy Stock, to meet
contemplated withdrawals, as the Committee shall specify in written requests;
(3) To hold Tandy Stock purchased as investments for the Trust
Fund in its name or in the name of its nominees;
(4) To sell, exchange, convey, transfer, or otherwise dispose
of any Tandy Stock held by it, by private contract or at public auction, to fund
Financial Hardship withdrawals on behalf of and for the benefit of the affected
Participant;
(5) Subject to Section XII hereof, to vote upon any stocks,
bonds, or other securities; to give general or special proxies or powers of
attorney with or without power of substitution; to exercise any conversion
privileges, subscription rights or other options; and to make any payments
incidental thereto; to oppose or consent to or otherwise participate in,
corporate reorganization or other change affecting corporate securities and to
delegate discretionary powers, and to pay any assessments or charges in
connection therewith; and generally to exercise any of the powers of an owner
with respect to stocks, bonds, securities or other properties held as a part of
the Trust Fund;
(6) To settle, compromise or submit to arbitration any claims,
debts or damages due or owing to or from the Trust Fund, to commence or defend
suits or legal or administrative proceedings; or
(7) To delegate to Tandy and/or the Committee by agreement in
writing, such ministerial, record keeping and discretionary duties as may be
agreed upon, including but not limited to the maintenance of records of account
of Participants, the quarterly determination of each Participant's account, and
the number of shares of Tandy Stock purchased, delivered, or distributed by it.
The powers granted to the Trustee under this Section III B
shall be exercised by the Trustee in its discretion; however, the Committee may
at any time and from time to time, by written direction to the Trustee, require
the Trustee to obtain the written approval of the Committee before exercising
such powers, as may be specified in such direction. Any such direction may be of
a continuing nature or otherwise, and may be revoked in writing by the Committee
at any time. Neither the Trustee nor any other person shall be under any duty to
question any such direction of the Committee and the Trustee shall as promptly
as possible comply with any directions given by the Committee hereunder. The
Trustee shall not be responsible for any loss which may result from the failure
or refusal of the Committee to give any such required approval.
C. INVESTMENT OF THE TRUST FUND: The Trustee shall at regular intervals
at current market prices invest all of the assets of the Trust Fund in Tandy
Stock.
D. PAYMENTS FROM THE FUND: The Trustee shall from time to time, on the
written direction of the Committee, make distributions out of the Trust Fund to
the Participants or the Participants' Beneficiaries, estates or Alternate
Payees, in such manner, in such Tandy Stock, and for such purposes as may be
specified in written directives of the Committee and upon any such distribution
being made, the amount thereof shall no longer constitute a part of the Trust
Fund. The Trustee shall not be responsible in any way for the application of
such distributions or for the adequacy of the Trust Fund to meet and discharge
any and all liabilities under the Program.
E. FEES AND EXPENSES OF THE TRUSTEE: The Trustee shall be paid such
reasonable compensation as shall from time to time be agreed upon in writing by
Tandy and the Trustee. In addition, the Trustee shall be reimbursed for any
reasonable expenses, including reasonable counsel fees, incurred by it in the
administration of the Trust Fund, except as hereinafter provided. Such
compensation and expenses incurred shall be paid by Tandy, but until paid shall
constitute a charge upon the Trust Fund; provided, however, that Tandy shall
have no obligation to pay such compensation and expenses, including counsel
fees, as are charged to the accounts of Participants by a court of competent
jurisdiction in any litigation in which the Program or any of its fiduciaries
are a party. All costs and expenses incurred in connection with the purchase,
sale and transfer of securities, and all taxes of any and all kinds whatsoever
that may be levied or assessed under existing or future laws upon, or in respect
of, the Trust Fund, or the income thereof, shall be paid by the Trustee from the
Trust Fund.
F. ACCOUNTING: The Trustee, or Tandy or the Committee by written
agreement with the Trustee, shall keep accurate and detailed accounts of all
receipts, disbursements and other transactions hereunder.
Within a reasonable time after the close of the Program Year and within
one hundred twenty (120) days following the resignation or removal of the
Trustee or termination of the Program, the Trustee shall render a complete
accounting for the Program Year preceding or then ended, as the case may be, to
a firm of independent public accountants to be selected by Tandy. Such
accountants shall have full authority to examine the Trustee's records and
accounts relating to the Program and to submit written reports thereon to Tandy.
Within a reasonable time after the close of the taxable year of the
Trust, which is hereby established to end on December 31 of each year, and
within one hundred twenty (120) days following the resignation or removal of the
Trustee or termination of the Trust, the Trustee shall render a complete
accounting for the taxable year preceding or then ended, as the case may be, to
Tandy or to a firm of independent public accountants to be selected by Tandy.
Such accountants shall have full authority to examine the Trustee's records and
accounts relating to the Trust and to submit written reports thereon to Tandy.
Within a reasonable time after the close of the Program Year, the
Trustee shall transmit to each Participant, in such form as the Trustee shall
determine, a statement setting forth the interest of each such Participant in
the Program. Such statement shall be deemed correct unless written notice to the
contrary shall be delivered to the Trustee by a Participant within thirty (30)
days following the mailing or delivery of such statement to the Participant.
Reports relating to the Trustee's accounts prepared by independent
accountants selected by Tandy shall be maintained at the principal office of
Tandy and shall be available for inspection by interested persons hereunder.
Subject to the right of a Participant to challenge the correctness of an annual
statement submitted to him by the Trustee, the approval by the independent
accountants of the Trustee's account shall constitute a complete release and
discharge of the Trustee from any liability in respect to any act or transaction
reflected in the Trustee's accounts. The foregoing provisions notwithstanding,
no person other than Tandy or the Committee may require an accounting or the
furnishing of a statement or bring an action against the Trustee with respect to
the Trust created hereby or its actions as Trustee.
Notwithstanding any of the foregoing provisions, the Trustee shall not
be liable for any failure to submit an account or statement in a timely fashion
where its failure to act is based on the omission of Tandy to name a firm of
independent accountants to whom such accounting is to be rendered or is based on
the failure of either Tandy or the Committee to supply information to the
Trustee necessary for the completion of the accounting or of the statement.
G. AUTHORIZATION TO PROTECT THE TRUSTEE: Any action by Tandy pursuant
to any of the provisions of this Agreement shall be evidenced by a certified
resolution of its Board of Directors delivered to the Trustee over the signature
of any person authorized by the said Board of Directors to make such written
instrument or resolution so certified to it. All orders, requests and
instructions of the Committee shall be in writing, signed by those members or
that member of the Committee so designated by the Committee, and the Trustee may
act and shall be fully protected in so acting in accordance with such orders,
requests and instructions. The Trustee shall not be liable for any loss to or
diminution of the Trust Fund except when the same may be due to its willful
misconduct or bad faith and the Trustee shall in no event have any
responsibility for the properties except those actually received by it.
H. REMOVAL AND RESIGNATION; SUCCESSOR TRUSTEE: The Trustee may be
removed by Tandy at any time upon thirty (30) days notice in writing to Trustee
and the Committee. The Trustee may resign at any time upon thirty (30) days
notice in writing to Tandy and to the Committee. Upon such removal or
resignation of the Trustee, Tandy shall appoint a successor trustee, which shall
be a bank or trust company having combined capital and surplus of not less than
Twenty-Five Million Dollars ($25,000,000.), which shall have the same powers and
duties conferred upon the Trustee hereunder. Upon acceptance of such appointment
by the successor trustee, the Trustee shall assign, transfer and pay over to
such successor trustee the funds and properties then constituting the Trust
Fund. The Trustee is authorized, however, to reserve such sum of money, as it
may deem advisable, for payment of its fees and expenses in connection with the
settlement of its account or otherwise, and any balance of such reserve
remaining after the payment of such fees and expenses shall be paid over to the
successor trustee.
IV
PARTICIPATION IN THE PROGRAM
A. ADOPTION OF PROGRAM. Tandy and each of its affiliates and associates
may adopt the Program for all or part of its employees as its Board of Directors
may in its discretion approve. Tandy and each of its affiliates and associates
adopting the Program are hereinafter collectively referred to as "Company".
B. ELIGIBILITY. Subject to the provisions of Section XX with respect to
union-represented employees, all employees are eligible to participate in the
Program if their contributions are limited in any Tandy Fund, formerly DIP, plan
year ("Tandy Fund Plan Year") as a result of Internal Revenue Code Sections
402(g), 415(c), 401(a)(17) and/or 401(k)(3) and following an election to
participate being received in the Program's administrative office, may make
contributions to the Program as a Participant for the remainder of any Tandy
Fund Plan Year after the date on which the contribution limit is reached.
Participation in the Program is entirely voluntary and the election to
participate may be made through Employee Payroll Deductions under Section V. To
remain as a Participant in the Program, an employee must continue to be an
"Employee" engaged in Continuous Full Time Service for Tandy or a Company, or in
employment which contemplates continued Qualifying Service.
C. APPLICATION FOR PARTICIPATION. In order to become a Participant
hereunder, each eligible employee shall execute a written application wherein he
shall evidence:
1. His intent to participate in the Program;
2. His joinder of this Trust Agreement executed by Tandy on
his behalf;
3. His consent for Employee Payroll Deductions in accordance
with Section V below; and 4. His acknowledgment and consent to
the withholding of taxes resulting from the Company
Contribution during the Taxable Year in which the Company Contribution is made.
Once an employee has completed the necessary eligibility requirements for
participation in the Program, contributions under Section V shall begin
automatically, but shall be held in a suspense account subject to receipt of a
payroll deduction form by the Program Administration office. The employee shall
have thirty (30) days from the automatic commencement of participation in the
Program to file a written application for participation. His participation in
the Program shall not become effective, however, until the start of the next pay
period after the application is received by the Company or after he has reached
the contribution limit in any Tandy Fund Plan Year following the year of his
initial enrollment in the Program.
In the event that an eligible employee making contribution during the
thirty (30) day period elects not to participate in the Program or fails to file
a written application for participation during the period, payroll deductions
made by the employee during the period shall be returned to the employee and any
Company or Other Contributions will be canceled.
V
INVESTMENT OPTION
A. RATE OF PAYROLL DEDUCTION.
1. After receipt of a payroll deduction form by the Program
Administration office, Participants shall have Employee Payroll Deductions
withheld at the rate of 1%, 2%, 3%, 4%, 5%, 6%, 7% or 8% of Earnings, in excess
of the maximum amount of Earnings needed to reach one of the contribution limits
to the Tandy Fund, formerly DIP, as set out in the Internal Revenue Code of
1986. Participation in the Program is for the remainder of the Tandy Fund Plan
Year.
2. Participants shall designate their participation and desire
to participate through payroll deductions by means of a signed payroll deduction
authorization form. The initial authorization shall continue in effect,
notwithstanding any change in Participant's Earnings, until the Participant
becomes ineligible for the Program. Deductions made subject to such
authorization are called "Employee Payroll Deductions".
B. COLLECTION AND PAYMENT OF EMPLOYEE PAYROLL DEDUCTIONS: The Company
shall withhold and deduct on each regular pay day from each Participant's
Earnings the contribution specified. The Company shall pay the Employee Payroll
Deductions over to Tandy and Tandy will use the Employee Payroll Deductions to
either deliver cash to the Trustee to purchase Tandy Stock or purchase and
deliver shares of Tandy Stock to the Trustee within thirty (30) days following
the end of the calendar quarter in which such contributions shall have been
deducted and withheld. In the event a Participant withdraws from the Program and
his contribution for the calendar quarter preceding the time of his withdrawal
has been withheld from his Earnings, but has not been used for the purchase of
Tandy Stock, then the Company shall refund to such withdrawing Participant the
amount of his contribution so withheld.
VI
CREDITS TO PARTICIPANTS
As soon as practicable after the end of each calendar quarter the
following credits shall be made to each Participant's account as of the end of
each calendar quarter:
A. EMPLOYEE PAYROLL DEDUCTION. The amount of Employee Payroll
Deductions withheld during each month of such quarter;
B. COMPANY CONTRIBUTION. A monthly amount (the "Company Contribution")
calculated in accordance with Section VI. B. 1. below:
1. The Company Contribution shall be determined on the basis
of each payroll period by multiplying the Employee Payroll Deduction by Eighty
Percent (80%); and
2. Within thirty (30) days following the end of each calendar
quarter, the Company shall contribute out of its earnings and profits to Tandy
and this amount, calculated in accordance with Section VI B. 1, shall be
delivered to the Trustee for the purchase of Tandy Stock or used to purchase and
deliver Tandy Stock to the Trustee. Except for excess contributions made because
of fraud or mistake of fact and returned within one (1) year after payment to
Tandy under this Program, no part of the contributions of the Company shall be
recoverable by it under any circumstances. In the event the Company should not
have sufficient current earnings or profits and be operating at a loss currently
and thus be unable to pay its full contributions to this Program, then such
contributions, if any, that it shall be able to make shall be allocated among
all Participants on the basis of the relative amounts of contributions made by
each during the quarter.
C. OTHER CONTRIBUTION-DIVIDEND INCOME ON STOCK. All cash dividends paid
on shares credited to the Participant's account on the record date designated by
Tandy for such dividend shall be allocated when paid to each Participant's
account as other contributions ("Other Contributions") and delivered to the
Trustee or applied to the purchase of Tandy Stock in accordance with Section VI.
D. below, for delivery to the Trustee. These Other Contributions will not be
subject to matching contributions by the Company or Tandy.
D. APPLICATION OF CREDITS. The Employee Payroll Deductions, Other
Contributions, and Company Contributions are to be applied to the acquisition of
Tandy Stock quarterly and shall be credited to the Participant's account as soon
as practicable after the end of the calendar quarter as Tandy Stock and any
Fractional Share (as defined in Section XIX) based upon the number of shares of
Tandy Stock purchasable at a price equal to the average closing price of Tandy
Stock as reported for the New York Stock Exchange composite transactions for
each trading day of the calendar month (the "Stock Price") for which the
deductions or contributions are made.
E. DIVIDENDS OTHER THAN CASH AND TANDY STOCK. All dividends with
respect to Tandy Stock held in a Participant's account under the Program that
are not payable in cash or Tandy Stock shall be distributed to the Participant
as soon as possible. All whole units of any security (other than Tandy Stock),
any rights and warrants for a whole unit of any security and whole units of any
other asset shall be distributed in kind. All fractional units of any security
(other than Tandy Stock), any rights and warrants for less than a whole unit of
any security and fractional units of any other asset shall be sold and the net
proceeds paid to the Participant.
F. STOCK DIVIDEND OR SPLIT-UP. Any Tandy Stock issuable by Tandy as a
stock dividend or split-up on the Tandy Stock and any Fractional Share to the
credit of the Participant on the record date designated by Tandy for such stock
dividend or split-up shall be credited to each Participant's account (in an
amount per share equivalent to any stock dividend or split-up actually paid by
Tandy on its Tandy Stock then outstanding) and delivered to the Trustee as soon
as practicable after the distribution date of such stock dividend or split-up.
VII
TRANSFERS TO TRUSTEE
A. EMPLOYEE PAYROLL DEDUCTION. The Company shall pay over to Tandy the
Employee Payroll Deductions of each Participant as soon as practicable after the
payroll period nearest the end of the calendar month in which such Employee
Payroll Deduction is withheld. The Employee Payroll Deductions will be credited
to the Participant's account quarterly and delivered to the Trustee for the
purchase of Tandy Stock and/or used to purchase Tandy Stock which will be
delivered to the Trustee as soon as practicable after the end of the calendar
quarter.
B. COMPANY CONTRIBUTIONS. The Company shall account for the Company
Contributions payable to Tandy on each Participant's account as soon as
practicable after the payroll period nearest the end of the calendar month in
which such Employee Payroll Deductions are withheld. The Company Contributions
shall be paid over to Tandy and credited to the Participant's account quarterly.
Said contributions shall then be delivered to the Trustee for the purchase of
Tandy Stock and/or used to purchase Tandy Stock which will be delivered to the
Trustee as soon as practicable after the end of the calendar quarter.
VIII
INVESTMENT
A. TANDY STOCK.
1. The Trustee will invest all or substantially all of the
Trust Fund in Tandy Stock.
2. Any Tandy Stock required for the Program may be treasury shares or
original issue shares.
3. Tandy Stock may be held by the Trustee, as custodian, at
its discretion either in its name or in the name of one or more nominees. Tandy
Stock shall be purchased and/or delivered to the Trustee as of the end of each
calendar quarter with respect to which the Tandy Stock is acquired by the
Program or Trustee and sold by Tandy, at the Stock Price determined for each
month of the quarter.
B. OTHER INTEREST AND INCOME. Except as herein expressly provided, no
interest or other income will be paid or credited on account of Employee Payroll
Deductions, Company Contributions, or any other amount payable or credited to
Participants.
IX
HOLDING PERIOD
A. DURATION. The Trustee shall retain for the Holding Period, Tandy
Stock credited to the Participant's account under the Program. The Holding
Period with respect to any Tandy Stock shall commence on the date as of which
the Tandy Stock is credited to the Participant's account and shall end when the
Participant has complied with one of the provisions for withdrawal under the
Program.
B. DISTRIBUTION. As promptly as practicable after the Holding Period,
the Trustee shall distribute the full and any Fractional Share of Tandy Stock
then held which was credited to the Participant's account under the Program
since the Holding Period began in accordance with the rules for withdrawals and
payment (as defined in Section X).
X
WITHDRAWALS AND PAYMENTS
A. WITHDRAWALS.
1. During employment the Program only provides for the full
withdrawal of a Participant's account upon receipt of a written request and
Notice of Financial Hardship including all supporting documentation at the
Program Administration office (1800 One Tandy Center, Fort Worth, Texas 76102)
prior to Program participation termination. A Financial Hardship withdrawal can
only be made if the withdrawal is to satisfy an immediate and heavy financial
need of the employee and is necessary to meet such financial need and where
other sources of payment are not reasonably available to the Participant. A
withdrawal will be deemed to be necessary as a Financial Hardship withdrawal if
both of the following requirements are met: (1) the withdrawal is not in excess
of the amount needed to satisfy the Financial Hardship plus any amounts
necessary to pay any federal, state or local taxes or penalties reasonably
anticipated to result from such payment; and (2) the Participant has obtained
all distributions, under all plans of the Company except for hardship
distributions from the Participant's Deferred Salary Account in the Tandy Fund,
formerly the Tandy Employees Deferred Salary and Investment Plan, and the ESOP
account in the Tandy Fund, formerly the Tandy Employees Stock Ownership Plan.
2. The Program also provides for the full withdrawal of a
Participant's account upon receipt of a written Notice of Withdrawal at the
Program Administration Office upon the Participant's (a) death or (b)
termination of Employment, either voluntarily, involuntarily or by retirement at
age 65 or older.
B. PAYMENT IN CASH OR TANDY STOCK.
1. The Participant will be paid in Tandy Stock if the
Participant delivers a written Notice of Withdrawal to the Program
Administration office or if the Company's records indicate that one of the above
two events of withdrawal (as defined in X. A. 2.) has occurred. All Financial
Hardship withdrawals will be paid in cash as provided for below.
2. Employee Payroll Deductions, Company Contributions and
Other Contributions not yet paid over or delivered as Tandy Stock to the Trustee
will be paid over to the withdrawing Participant by the Company or Tandy in
cash.
3. Upon withdrawal no Fractional Share will be distributed by
the Trustee. In lieu of distribution of such Fractional Share of Tandy Stock the
Trustee will pay a Participant the Stock Price for the month preceding the
distribution date.
C. DETERMINATION OF AMOUNT OF PAYMENT. The amount of payment in Tandy
Stock will be determined by the number of shares credited to a Participant's
account:
1. at the end of the calendar quarter preceding the receipt of the
written Notice of
Withdrawal by the Program Administration office; or
2. in the absence of receipt by the Program Administration
office of a Notice of Withdrawal from the Participant, Alternate Payee(s), or
the Participant's Beneficiary, at the end of the calendar quarter preceding the
month in which one of the two withdrawal events is recorded in the records of
the Program Administration office, regardless of the month in which such event
occurred.
In the event of a Financial Hardship withdrawal, when the Participant delivers a
written Notice of Financial Hardship Withdrawal to the Program Administration
office, then the Trustee shall take the number of shares of Tandy Stock credited
to the Participant's account at the end of the preceding calendar quarter, value
it at the Stock Price for the calendar month preceding the date of receipt of
the notice of withdrawal, sell such Tandy Stock and then distribute cash to the
Participant.
D. REENTERING THE PROGRAM. In the event of a Financial Hardship
withdrawal under this Program a Participant may not renew participation for a
period of twelve (12) months from the date of distribution of the withdrawal.
E. RECIPIENT OF DISTRIBUTION. All withdrawal distributions will be made
to the Participant except withdrawal distributions resulting from death or
divorce of the Participant. In the event of death, payment will be made to the
Beneficiary designated by the Participant or as otherwise provided by the
Program and the Participant's Beneficiary may act in behalf of the Participant.
In the event of a Participant's divorce, a certified copy of the divorce decree
or Qualified Domestic Relations Order (collectively referred to hereinafter as
"Court Order") must be submitted to the Program Administration office together
with any other identifying information as required by the Program Administration
office. The Participant's account will then be divided as specifically ordered
in the Court Order and the shares awarded to the Alternate Payee(s) will be
withdrawn. Distribution to the Participant, the Alternate Payee(s), or
Beneficiary shall be made as soon as practicable after the event permitting
withdrawal.
F. SUSPENSION FROM THE PROGRAM. In the event of a Participant's
withdrawal from the Tandy Fund, formerly DIP, the Participant will be suspended
from participation in the Program as set out below:
1. Partial Withdrawal. If a Participant elects to withdraw all
or any portion of the value of his Voluntary account under the Tandy Fund,
formerly DIP, if any, his participation in the Program does not terminate, but
his Employee Payroll Deductions and Company Contributions shall automatically be
suspended for a period of six months.
2. Total Withdrawal. If a Participant elects to withdraw the
full value of his Company account under the Tandy Fund, formerly DIP, while
employed by Company, his participation under the Program is suspended for a
period of 12 months, during which no Employee Payroll Deductions or Company
Contributions will be made.
3. Tandy Fund, formerly DIP, Hardship Withdrawal. If a
participant makes a financial hardship withdrawal under the Tandy Fund, formerly
DIP, his participation under the Program is suspended for a period of 12 months
from the date of distribution of the withdrawal, during which period no Employee
Payroll Deductions or Company Contributions will be made.
XI
BENEFICIARY
A. DESIGNATION OF BENEFICIARY. Participants shall file with the Company
a written designation of Beneficiary designating who is to receive any Tandy
Stock, Fractional Share payment, and any cash to the Participant's credit under
the Program in the event of his death prior to delivery to him of such Tandy
Stock, Fractional Share payment or cash.
B. CHANGE OF BENEFICIARY. A Participant may change his Beneficiary
designation at any time by written notice being delivered to the Program
Administration office. Such change shall take effect as of the date the
Participant signed such written notice, whether or not Participant is living at
the time of receipt of such notice by the Program Administration office, except
that the change of Beneficiary shall not be effective if the Program has
distributed the Participant's account prior to receipt of the change of
Beneficiary form.
C. DISTRIBUTIONS TO BENEFICIARY. Upon the death of a Participant and
upon receipt of proof deemed adequate by the Program Administration office of
the identity and existence at the Participant's death of a Beneficiary or
Beneficiaries validly designated by him under the Program, distribution will be
made to the Beneficiary or Beneficiaries in the manner and form as set forth in
Section X hereof.
D. ABSENCE OF BENEFICIARY. In the absence of a Beneficiary designated
under the Program who is living at the time of Participant's death, distribution
shall be made to the executor or administrator of the estate of the Participant.
If no executor or administrator has been appointed to the knowledge of the
Program Administration office (or in the event such executor or administrator
has been disqualified), distribution may be made to such person or persons as
the Program Administration office shall be satisfied is or are legally entitled
thereto.
E. INTEREST OF BENEFICIARY IN PROGRAM. No designated Beneficiary shall,
prior to the death of the Participant by whom he has been designated, acquire
any interest in the Tandy Stock, Fractional Share, or cash credited to the
Participant under the Program or in the assets of the Trust.
XII
VOTING AND TENDERING OF TANDY STOCK
A. VOTING OF TANDY STOCK BY PARTICIPANTS AND BENEFICIARIES.
Notwithstanding any provision
contained in the Program to the contrary, or:
1. The Trustee shall have the power to vote all Tandy Stock
held by it on matters which may be voted by Member Organizations of the New York
Stock Exchange, Inc. without customer instructions as provided in Rule 452 of
the Rules of the Board of Directors of the New York Stock Exchange, Inc.
(Supplementary Material Item .11).
2. With respect to matters other than those described in
Subsection 1 of this Section A of this Article ("Pass Through Matters"), each
Participant or Beneficiary who timely provides instructions to the Trustee shall
be entitled to direct the Trustee how to vote Tandy Stock allocated to such
Participant's or Beneficiary's accounts in accordance with this Section. In
order to implement these voting directions, Tandy or the Trustee shall provide
each Participant or Beneficiary with proxy solicitation materials or other
notices or an information statement which are distributed to Tandy shareholders,
together with a form requesting confidential instructions as to the manner in
which Tandy Stock allocated to the Participant's or Beneficiary's account are to
be voted. Each Participant or Beneficiary shall, as a named fiduciary described
in Section 403(a)(1) of ERISA, direct the Trustee with respect to the vote of
such Tandy Stock allocated to the account of the Participant or Beneficiary.
Reasonable means shall be employed by the Trustee to provide confidentiality
with respect to the voting by such Participant or Beneficiary and the Trustee
shall hold such directions in confidence and shall not divulge or release such
directions to any person, including Tandy or any director, officer, employee or
agent of Tandy, it being the intent of this provision of this Section to ensure
that Tandy (and its directors, officers, employees and agents) cannot determine
the direction given by any Participant or Beneficiary. Such instructions shall
be in such form and shall be filed in such manner and at such time as the
Trustee may prescribe.
3. On Pass-Through Matters, the Trustee shall vote all Tandy
Stock which is allocated to Participants' and Beneficiaries' accounts for which
it does not receive timely or valid voting instructions in the same proportion
as Tandy Stock which is allocated to Participants' and Beneficiaries' accounts
for which it does receive timely and valid voting instructions.
B. TENDER OFFERS. The provisions of this Section shall apply in the
event any "Person" (as the term person is used for purposes of Section 13(d) or
14(d) of the Securities Exchange Act of 1934, as amended), either alone or in
conjunction with others, makes a tender offer, or exchange offer, or otherwise
offers to purchase, or solicits an offer to sell to such Person, one percent or
more of the outstanding Company securities (hereinafter referred to as a "Tender
Offer").
1. The Trustee may not take any action in response to a Tender
Offer except as otherwise provided in this Section B of this Article XII. Upon
commencement of a Tender Offer, Tandy or the Trustee shall notify each
Participant or Beneficiary for whom an account is maintained of such Tender
Offer and use its best efforts to timely distribute or cause to be distributed
to each Participant or Beneficiary all information, documents and other
materials as are distributed to shareholders of the Tandy with the Tender Offer.
Each Participant or Beneficiary shall be entitled to direct the Trustee to sell,
offer to sell, exchange or otherwise dispose of the Tandy Stock allocated to
such Participant's or Beneficiary's accounts in accordance with the provisions,
conditions and terms of such Tender Offer and the provisions of this Section.
Such a Participant or Beneficiary shall direct the Trustee with respect to the
tender of such shares of Tandy Stock which are allocated to the accounts of the
Participant or Beneficiary. Reasonable means shall be employed by the Trustee to
provide confidentiality with respect to the tendering directions by each
Participant or Beneficiary and the Trustee shall hold such directions in
confidence and shall not divulge or release such directions to any person,
including Tandy or any director, officer, employee or agent of Tandy, it being
the intent of this provision of this Section to ensure that Tandy (and its
directors, officers, employees and agents) cannot determine the tendering
directions given by any Participant or Beneficiary. Such instructions shall be
in such form and shall be filed in such manner and at such time as the Trustee
may prescribe.
2. A Participant or Beneficiary who has directed the Trustee
to tender or exchange Tandy Stock may, at any time prior to the tender or
exchange offer withdrawal date, or such earlier date as established by the
Trustee, instruct the Trustee to withdraw, and the Trustee shall withdraw, such
Tandy Stock from the tender or exchange offer prior to the withdrawal deadline.
The Trustee may impose reasonable limits on the number of instructions to tender
or exchange or withdraw which a Participant or Beneficiary may give to the
Trustee.
3. The Trustee shall sell, offer to sell, exchange or
otherwise dispose of the Tandy Stock allocated to a Participant's or
Beneficiary's account with respect to which it has received directions to do so
under this Section and which have not been withdrawn. The proceeds of a
disposition directed by a Participant or Beneficiary shall be allocated to such
Participant's or Beneficiary's account.
4. To the extent to which Participants or Beneficiaries do not
instruct the Trustee, or do not issue valid directions to the Trustee, to sell,
offer to sell, exchange or otherwise dispose of the Tandy Stock allocated to
their accounts, such Participants or Beneficiaries shall be deemed to have
directed the Trustee that their respective accounts remain invested in Tandy
Stock subject to all provisions of the Program.
5. Following the completion of a Tender Offer, the Committee
may direct the substitution of new "qualified employer securities" as such term
is defined in Internal Revenue Code Section 409(1) for Tandy Stock or for the
proceeds of any disposition of Tandy Stock to the extent provided in the
Program; provided, however, that any such substitute employer securities must be
publicly traded securities. In lieu of the substitution of new qualified
employer securities, the Committee may direct that the Trust Fund be invested in
other securities, properties or investment vehicles. Pending the reinvestment of
any disposition of Tandy Stock, the Trust Fund may be invested in such
securities, property or investment vehicles as the Committee may from time to
time direct; provided, however, in the absence of any direction from the
Committee, the Trustee may invest the cash proceeds in short-term securities
issued by the United States of America or any agency or instrumentality thereof
or any other investment of a short-term nature, including corporate obligations
or participations therein and collective or common investment funds.
<PAGE>
XIII
PARTICIPATION BY AFFILIATED COMPANIES
This Program shall apply to any corporation a portion of whose voting
stock is owned directly or indirectly by Tandy, and any of its affiliates, if
such company or corporation shall elect to participate and if, and so long as,
such participation shall be approved by Tandy. Each participating Company shall
be bound by the terms of this document.
XIV
NO WARRANTY OF SECURITY VALUES
Neither the Trustee or Company, their officers, directors, agents or
servants, warrants or represents in any way that the value of Tandy Stock in
which the Participant may have an interest will increase or will not decrease.
Each Participant assumes all risk in connection with any changes in the value of
Tandy Stock to the extent he may have an interest therein.
XV
GENERAL PROVISIONS
A. EXTENT OF CERTAIN RIGHTS OF PARTICIPANTS. Participation in the
Program shall not entitle any employee to be retained in the service of Company.
The at-will employment right and power of Company to dismiss or discharge any
employee is specifically reserved.
B. LIMITATION OF PARTICIPANT'S RIGHTS. No Participant nor any person
claiming under or through them shall have any right or interest under the
Program that is not herein expressly granted.
C. ASSIGNMENT. No interest in any Tandy Stock or cash held under the
Program prior to delivery to the Participant as hereinabove provided, shall be
assigned, alienated, pledged, or otherwise encumbered in whole or in part,
either directly by operation of law, or otherwise. If any attempt is made by a
Participant to assign, alienate, pledge, or otherwise encumber his interest in
such Tandy Stock or cash, prior to such delivery, for his debts, liabilities in
tort or contract, or otherwise, then the Committee (in its absolute discretion)
may treat such attempt as an election by the Participant to withdraw from the
Program permanently and submit to any loss of rights as provided in the Program
in the case of a withdrawal at the time of such attempt, except that a Court
Order, to pay an Alternate Payee(s), issued upon a Participant's divorce shall
not be a violation under this paragraph which requires a Participant's
withdrawal.
D. QUARTERLY STATEMENT OF ACCOUNTS. As soon as practicable after the
end of each calendar quarter, each Participant shall be furnished with a
statement of Tandy Stock credited to his account under the Program.
E. REGISTRATION OF STOCK. Each Participant, Beneficiary or Alternate
Payee shall, at such time as the Program Administration office or Tandy may
reasonably request, furnish written instructions for the registration of the
Tandy Stock to be delivered under the Program upon completion of the Holding
Period. Such Tandy Stock will be registered in the name of the Participant,
Beneficiary or Alternate Payee (or if a minor, in the name of another person as
custodian under the Uniform Gifts to Minors Act, or if incompetent, in the name
of the guardian or such other person(s) as the Program Administrative Committee
or Tandy may determine) alone or in his name and that of one such other adult
person as he may designate as joint tenants with right of survivorship, and not
as tenants in common. Such instructions shall remain in effect until receipt by
the Program Administration office or Tandy of written instructions to change the
registration previously authorized. In the absence of such written instructions,
Tandy Stock to be delivered to a Participant will be registered in his name or
the Alternate Payee's name alone or in the event of his death prior to such
delivery will be registered in the name of the person or persons entitled
thereto.
F. MISCELLANEOUS.
1. The Trustee may rely upon the authenticity of any
information supplied to it by the Company in connection with the operation of
the Program, and shall be fully protected in relying upon such information.
2. No individual administering, or aiding in the
administration of the Program or the Trust shall have any liability, except as
provided in Section XV.F.3. below. As a condition precedent to participation in
the Program or the receipt of benefits thereunder, such liability if any, is
expressly waived and released by each Participant and by any and all persons
claiming under or through any Participant such waiver and release to be
conclusively evidenced by the act of participation or the acceptance of benefits
thereunder.
3. No individual administering, or aiding in the
administration of, the Program shall be liable except for his own acts or
omissions and then only for willful misfeasance, bad faith, gross negligence or
reckless disregard of the duties involved in the conduct of his office. As used
herein, "individual administering, or aiding in the administration of the
Program" shall include any share owner, director, officer, employee or agent of
the Company or Trustee.
4. Tandy or the Program Administration office may require
compliance with any legal requirements which it deems necessary as a condition
for delivery of, or payment for, any Tandy Stock or cash to the credit of a
Participant under the Program.
5. By a Participant's act of participating in the Program or
by the acceptance of any of the benefits thereunder, such Participant and any
and all persons claiming under or through any such Participant, shall thereby be
conclusively deemed to have indicated his acceptance and ratification of, and
consent to, the application of the provisions of the Program.
6. Tandy Stock purchased, sold or transferred under the
Program by Tandy or the Trustee may be either treasury shares or newly issued
shares.
7. No Participant, beneficiary of a Participant, or any other
person shall have any right or claim to the Trust Fund except as specified in
the Program and this Trust Agreement. Any disputes as to the amount of benefits
payable or distributable under this Trust shall be resolved by the Committee,
whose decision shall be final. No Participant or any other person shall have any
right or claim with respect to disputed benefits against the Trust, the Trustee
or Company.
8. The determination of any question relating to the
construction, interpretation, administration or application of the Program and
its rules and regulations is vested solely in the Committee and all
Participant's and other persons shall be bound thereby.
9. For the purposes of the Program, unless the contrary is
clearly indicated by the context, the use of the masculine gender shall also
include within its meaning the feminine, and the use of the singular shall also
include within its meaning the plural, and vice versa.
XVI
NOTICES AND COMMUNICATIONS
A. TO PARTICIPANTS. All notices, reports and other communications to a
Participant under or in connection with the Program shall be deemed to have been
duly given, made or delivered when received by the Participant, or (if mailed)
when mailed with postage prepaid and addressed to the Participant at his address
last appearing on the records of the Company.
B. BY PARTICIPANTS. All notices, instructions or other communications
by a Participant to Tandy under or in connection with the Program shall be duly
given, made or delivered when received by the Corporate Secretary of Tandy (1800
One Tandy Center, Fort Worth, Texas 76102) or when received in the form
specified in writing by Tandy and at the location, or by the person, designated
for receipt of such notice, instruction or other communication by Tandy.
XVII
AMENDMENT, SUSPENSION OR TERMINATION
A. AUTHORITY TO AMEND, SUSPEND OR TERMINATE. The Tandy Board of
Directors, without notice to a Participant, may amend, suspend or terminate the
Program at any time, or from time to time. Without limitation, such amendment
may change (a) the rates of Employee Payroll Deductions which may be designated
by all Participants or (b) the rate of Company Contributions, or (c) any other
provisions of the Program, except a Participant's percentage rate of Employee
Payroll Deductions may not be increased without his consent.
B. DELEGATION OF AUTHORITY. The Tandy Board of Directors may delegate
to the Chairman of the Board, Vice Chairman of the Board, or President the
authority to amend any provision of this Program, provided such amendment is (a)
of an administrative nature or (b) does not result in any material increase in
costs to a Company.
C. AMENDMENTS. No amendment, suspension or termination shall adversely
affect any rights of a Participant to Tandy Stock, Fractional Share payment or
cash to his credit under the Program as of the date of amendment, suspension or
termination. Upon such termination, all Tandy Stock, Fractional Share payment or
cash to the credit of each Participant under the Program shall be promptly paid
over to him.
XVIII
APPLICABLE LAW
Any question concerning or in respect of the validity, construction,
interpretation, administration and effect of the Program, and of its rules and
regulations, and the rights of any or all persons having or claiming to have an
interest therein or thereunder, shall be governed exclusively and solely in
accordance with the laws of the State of Texas, with Jurisdiction for any action
being expressly agreed as being in Tarrant County, Texas where all contributions
to the Trust are deemed to take place.
XIX
DEFINITIONS
For the purposes of the Program, unless some other meaning is clearly
indicated by the context, the following definitions shall be applicable:
"Alternate Payee" shall have the same meaning as defined in Internal
Revenue Code section 414 (p) and in the Employee Retirement Income Security Act
at 29 U.S.C.S. section 105, as it may be amended from time to time.
"Beneficiary" is defined in Section XI.
"Company" is defined in Section IV as "Tandy and each of its affiliates
and associates adopting the Program".
"Company Contribution" is defined in Section VI
"Continuous Full Time Service" means the most recent period of
uninterrupted employment as an employee of the Company when such employment
consists of more than thirty-five (35) hours per week for more than five (5)
months per year. The continuity of an employee's service shall not be deemed to
be broken during such period as the employee shall be:
(a) on military leave; or
(b) on other leave of absence authorized by the Company
for sickness, disability, or other circumstances,
granted in accordance with an established and
uniformly applied Company policy; or
(c) laid off in order to effect a temporary reduction in
personnel, provided such employee shall be reemployed
within three hundred sixty-five (365) days after such
lay-off.
"Court Order" is defined in paragraph X. E.
"Earnings" means the amount which an employee is receiving as salary or
wages from the Company, including (a) payment for overtime, vacation pay, night
shift bonus, and any cost of living adjustment, including Incentive
Compensation, other variable compensation or Bonds, but excluding (b) living
allowance, retainers, any special payments made for services performed outside
his regular duties and any other special payments, (c) except to the extent that
the inclusion of any item in (b) above is specifically approved by the Chief
Executive Officer of Tandy or by such employee or employees of the Company as he
may authorize in writing. Commissions shall be included as Earnings only to the
extent determined by the Chief Executive Officer of Tandy or by such employee or
employees of the Company as he may authorize in writing. Earnings shall not
include Company Contributions to the Tandy Stock Purchase Program.
"Employee" means a regular employee of the Company receiving wages or
salary, but shall not include any person compensated pursuant to a contract
other than an employment contract with the Company under the terms of which
compensation is paid on a regular fixed salary or wage basis. As used above,
"Employee" shall also include, without limitation, any salesman who is a bona
fide employee of the Company and recognized as such for Social Security
purposes.
"Employee Payroll Deduction" is defined in Section V.
"Financial Hardship" as used in Section X is defined as (1) expenses
for "medical care" (as described in Section 213(d) of the Internal Revenue Code)
which are either: (a) previously incurred by the Participant, the Participant's
spouse, children or any dependents (as defined in Section 152 of the Internal
Revenue Code) of the Participant, or (b) necessary for the foregoing persons to
obtain medical care; (2) the need for funds for the purchase of a principal
residence of the Participant (excluding mortgage payments); (3) payment of
tuition and related educational fees for the next 12 months of post-secondary
education for the Participant or the Participant's spouse, children or
dependents (as defined in Section 152 of the Internal Revenue Code); or (4) the
need for funds to prevent the eviction of the Participant from his principal
residence or to prevent foreclosure on the mortgage of the Participant's
principal residence.
"Fractional Share" means an interest equivalent to and expressed as a
fraction of a share of Tandy Stock determined by dividing that amount credited
to the Participant to be applied to the purchase of Tandy Stock (but which is
insufficient to acquire a full share of Tandy Stock) by the applicable Stock
Price for the applicable month with respect to such credit.
"Holding Period" is defined in Section IX.
"Officers" means the Chairman of the Board, President, any Executive
Vice President, Senior Vice President, Vice President, Treasurer, Secretary,
Assistant Treasurer or Assistant Secretary and such other employees as the Tandy
Board of Directors may designate as "Officers" for this purpose.
"Other Contribution" is defined in Section VI.C.
"Participant" is defined in Section IV.
"Program" is defined in Section I.
"Qualifying Service" means the most recent period of uninterrupted
employment consisting of 1,000 hours of employment in any twelve (12) month
period.
"Stock Price" is defined in Section VI.D. as "a price equal to the
average closing price of Tandy Stock as reported for the New York Stock Exchange
composite transactions for each trading day of the calendar month".
"Tandy" is defined as Tandy Corporation, a Delaware corporation.
"Tandy Stock" is defined as Tandy Corporation Common Stock.
"Trustee" is defined as Bank One, Texas, NA, formerly Team Bank.
"Trust Fund" is defined in Section III as cash or Tandy Stock held for
the benefit of Participants.
XX
TRUST TAX STATUS
A. The Program is intended to be established as a grantor trust under
sections 671-677 of the Internal Revenue Code of 1986, as amended, with each
Participant considered to be a grantor subject to tax on his share of Trust
income as the owner of his respective portion of the Trust as represented by his
Participant account.
B. Tandy shall report to the Trustee within 60 days and the Trustee, or
Tandy, shall report to each Participant within 75 days of the end of each
Program Year the amount of dividends paid on Tandy Stock held in his account.
XXI
EFFECTIVE DATE
A. The Program shall become effective as of the date set forth in
Section I.B. but only upon approvals, rulings and orders (satisfactory to Tandy
and, to the extent deemed by Tandy to be necessary or desirable) by the
appropriate State and Federal or other government authorities with respect to
the Program and any action contemplated under the Program.
B. Notwithstanding the provisions of Section IV, and Paragraph A of
this Section, employees who are represented by a union (pursuant to a
certification by the National Labor Relations Board or otherwise in accordance
with the provisions of Section 9 of the National Labor Relations Act) shall
become eligible to participate in the Program (a) only after the Company and
such union shall have entered into a written agreement to the effect that the
Program shall be offered to the employees so represented and (b) only in
accordance with any conditions or requirements contained in such agreement.
XXII
CHANGE IN CONTROL
A. Notwithstanding any provision contained in the Plan to the contrary,
for a period of one (1) year following a Change in Control (as hereinafter
defined), the Program may not be terminated or amended in any way that would
adversely affect the computation or amount of, or entitlement to, benefits
hereunder, including, but not limited to, (a) any reduction in the right to make
Employee Payroll Deductions by any individual who was an eligible employee on
the date immediately prior to a Change in Control, (b) a reduction in the level
of Company Contributions with respect to such individuals or (c) any change in
the distribution or withdrawal provisions. Any amendment or termination of the
Program that (i) was at the request of a third party who has indicated an
intention or taken steps reasonably calculated to effect a Change in Control or
(ii) otherwise arose in connection with, or in anticipation of, a Change in
Control shall be null and void, and shall have no effect whatsoever.
B. For purposes of the Program, a "Change in Control" shall mean any of
the following events:
1. An acquisition (other than directly from Tandy) of any
voting securities of Tandy (the "Voting Securities") by any "Person" (as the
term person is used for purposes of Section 13(d) or 14(d) of the Securities
Exchange Act of 1934, as amended (the "1934 Act")) immediately after which such
Person has "Beneficial Ownership" (within the meaning of Rule 13d-3 promulgated
under the 1934 Act) of fifteen percent (15%) or more of the combined voting
power of Tandy's then outstanding Voting Securities; provided, however, in
determining whether a Change in Control has occurred, Voting Securities which
are acquired in a "Non-Control Acquisition" (as hereinafter defined) shall not
constitute an acquisition which would cause a Change in Control. A "Non-Control
Acquisition" shall mean an acquisition by (1) an employee benefit plan ( or a
trust forming a part thereof) maintained by (i) the Company or (ii) any
corporation or other Person of which a majority of its voting power or its
voting equity securities or equity interest is owned, directly or indirectly, by
Tandy (a "Subsidiary"), (2) Tandy or its Subsidiaries, or (3) any Person in
connection with a "Non-Control Transaction" (as hereinafter defined);
2. The individuals who, as of August 22, 1990 are members of
the Board (the "Incumbent Board") cease for any reason to constitute at least
two-thirds of the Board; provided, however, that if the election, or nomination
for election by Tandy's stockholders, of any new director was approved by a vote
of at least two-thirds of the Incumbent Board, such new director shall, for
purposes of the Program, be considered as a member of the Incumbent Board;
provided further, however, that no individual shall be considered a member of
the Incumbent Board if such individual initially assumed office as a result of
either an actual or threatened "Election Contest" (as described in Rule 14a-11
promulgated under the 1934 Act) or other actual or threatened solicitation of
proxies or consents by or on behalf of a Person other than the Board (a "Proxy
Contest") including by reason of any agreement intended to avoid or settle any
Election Contest or Proxy Contest; or
3. Approval by stockholders of Tandy of:
(i) A merger, consolidation or reorganization involving Tandy, unless
(I) the stockholders of Tandy, immediately before
such merger, consolidation or reorganization, own,
directly or indirectly immediately following such
merger, consolidation or reorganization, at least
sixty percent (60%) of the combined voting power of
the outstanding voting securities of the corporation
resulting from such merger or consolidation or
reorganization (the "Surviving Corporation") in
substantially the same proportion as their ownership
of the Voting Securities immediately before such
merger, consolidation or reorganization,
(II) the individuals who were members of the
Incumbent Board immediately prior to the execution of
the agreement providing for such merger,
consolidation or reorganization constitute at least
two-thirds of the members of the board of directors
of the Surviving Corporation,
(III) no Person (other than any Tandy Subsidiary, any
employee benefit plan (or any trust forming a part
thereof) maintained by Tandy, the Surviving
Corporation, or any Tandy Subsidiary, or any Person
who, immediately prior to such merger, consolidation
or reorganization had Beneficial Ownership of fifteen
percent (15%) or more of the then outstanding Voting
Securities) has Beneficial Ownership of fifteen
percent (15%) or more of the combined voting power of
the Surviving Corporation's then outstanding voting
securities, and
(IV) a transaction described in clauses (I) through
(III) shall herein be referred to as a "Non-Control
Transaction";
(ii) A complete liquidation or dissolution of Tandy; or
(iii) An agreement for the sale or other disposition of all or
substantially all of the assets of Tandy to any Person (other
than a transfer to a Tandy Subsidiary).
Notwithstanding the foregoing, a Change in Control shall not be deemed
to occur solely because any Person (the "Subject Person") acquired Beneficial
Ownership of more than the permitted amount of the outstanding Voting Securities
as a result of the acquisition of Voting Securities by Tandy which, by reducing
the number of Voting Securities outstanding, increases the proportional number
of shares Beneficially Owned by the Subject Person, provided that if a Change in
Control would occur (but for the operation of this sentence) as a result of
acquisition of Voting Securities by Tandy, and after such share acquisition by
Tandy, the Subject Person becomes the Beneficial Owner of any additional Voting
Securities which increases the percentage of the then outstanding Voting
Securities Beneficially Owned by the Subject Person, then a Change in Control
shall occur.
C. Notwithstanding any provision contained in the Program to the
contrary, no provision of this Article XXII may be amended at any time.
D. Notwithstanding any provision contained in the Program to the
contrary, the provisions of this Article XXII shall be binding upon Tandy and
its successors and assigns.
E. Notwithstanding any provision contained in the Program to the
contrary, the provisions of this Article XXII shall be deemed severable and the
validity or unenforceability of any provision shall not affect the validity or
enforceability of the other provisions hereof.
F. The provisions of this Article XXII shall govern notwithstanding
anything contained in the Program to the contrary.
IN WITNESS WHEREOF, Tandy and the Trustee have caused this Agreement to
be executed by their duly appointed officers and their corporate seals to be
hereunto affixed as of the date first written above.
ATTEST:
TANDY CORPORATION
/s/Jana Freundlich By:/s/Richard L.Ramsey
Jana Freundlich Richard L. Ramsey
(SEAL)
ATTEST:
BANK ONE, TEXAS, NA
/s/ Konnie Darrow By: /s/J. C. White
Konnie Darrow J. C. White
Trust Officer Vice President and Trust Officer
(SEAL)
Exhibit 5.1
Satterlee Stephens Burke & Burke LLP
230 Park Avenue
New York, New York 10169-0079
(212)818-9200
September 18, 1998
Tandy Corporation
100 Throckmorton Street, Suite 1800
Fort Worth, Texas 76102
Dear Sirs:
You have requested our opinion connection with a Registration Statement on Form
S-8 to be filed by Tandy Corporation (the "Company") with the Securities and
Exchange Commission for registration pursuant to the Securities Act of 1933, as
amended, of (i) units of participation to be offered in, and (ii) shares of
Company common stock, par value $1.00 per share, and Preferred Share Purchase
Rights appurtenant thereto, to be purchased by the Tandy Employee Supplemental
Stock Program (the "Program").
As counsel for the Company, we are familiar with the Program, and with the
corporate proceedings relating thereto. Based thereon, it is our opinion that
the interests in the Program and securities of the Company registered for
purchase thereunder will, when sold or issued, be legally issued, fully paid and
non-assessable, provided, in the case of original issue shares (if any), the
Company receives as consideration an amount at least equal to the par value
thereof.
As such counsel it is our further opinion that the provisions of the written
documents constituting the Program comply with the requirements of the Employee
Retirement Income Security Act of 1974, as amended ("ERISA"), relating to such
provisions. We note that our opinion is based on the laws, regulations and
rulings currently in effect under ERISA and there is no assurance that such
laws, regulations and rulings may not change or be the subject of further
interpretation by the Department of Labor.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and to the reference to this firm under the caption
"Legal Matters" in the Prospectus forming a part thereof.
Very truly yours,
SATTERLEE STEPHENS BURKE & BURKE LLP
By: /s/ Dwight A. Kinsey
A Member of the Firm
Exhibit 23.1
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in this Registration
Statement on Form S-8 of our report dated February 24, 1998, appearing on page
32 of Tandy Corporation's Annual Report on Form 10-K for the year ended December
31, 1997.
PRICEWATERHOUSE COOPERS LLP
Fort Worth, Texas
September 18, 1998
