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 CORPORATION 1999 INCENTIVE STOCK PLAN
(Full Title of the Plan)
M. C. Hill, Senior 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)
<TABLE>
CALCULATION OF REGISTRATION FEE
- ------------------------- ---------------------- ----------------------- ----------------------
<CAPTION>
Title of Proposed Proposed
Securities Amount Maximum Maximum Amount of
to be to be Offering price aggregate Registration
Registered Registered (1) per share (2) offering price Fee(2)
- ------------------------- ---------------------- ----------------------- ----------------------
<S> <C> <C> <C> <C>
Common Stock,
$1 par value 2,903,500 $28.0157 $81,343,584 $22,614
Preferred Share 6,000 $38.4063 $230,537 $65
Purchase Rights 6,590,500 $44.5313 $293,483,533 $81,589
- ------------------------- ---------------------- ----------------------- ----------------------
<FN>
<F1>(1) The number of shares registered has been computed on the basis of the
Issuer's estimate of the aggregate number of shares which will be needed for
grants and awards over the ten year life of the Tandy Corporation 1999 Incentive
Stock Plan. One Preferred Share Purchase Right automatically trades with each
share of Common Stock and is evidenced by the certificate for the Common Stock.
<F2>(2) As of the date hereof, options to purchase 2,903,500 shares of Common
Stock of the Registrant have been granted pursuant to the Tandy Corporation 1999
Incentive Stock Plan (the "Plan") at an exercise price of $28.0157 per share and
options to purchase 6,000 shares of Common Stock of the Registrant have been
granted pursuant to the Plan at an exercise price of $38.4063 per share. The
registration fees for the foregoing shares are based upon such exercise prices.
Pursuant to Rule 457(c), the registration fee for the 6,590,500 shares not
currently subject to outstanding options under the Plan is based upon a price of
$44.5313 per share, (adjusted for a 2 for 1 stock split), the average of the
high and low sales price reported on the New York Stock Exchange Composite
Transactions System for the Registrant's Common Stock on June 16, 1999.
</FN>
</TABLE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. INCORPORATION OF DOCUMENTS BY REFERENCE
The following documents, which have been filed (File No. 1-5571) by
Tandy Corporation ("Tandy" or "Registrant") with the Securities and Exchange
Commission (the "Commission") pursuant to the Securities Act of 1933, as
amended, and the Securities and Exchange Act of 1934, as amended (the "1934
Act"), are incorporated by reference in this Registration Statement and shall be
deemed a part hereof: (a) Annual Report on Form 10-K for the year ended December
31, 1998; (b) Current Reports on Form 8-K, filed May 14, 1999, May 24, 1999 and
May 25, 1999; (c) Proxy Statement dated April 6, 1999; (d) Registration
Statement on Form 8-B dated February 26, 1968, Registration Statement on Form
8-A dated August 26, 1986, Amendment No. 1 on Form 8 to Registration Statement
on Form 8-A dated July 11, 1988 and Amendment No. 2 on Form 8 to Registration
Statement on Form 8-A dated June 27, 1990.
All documents subsequently filed by Tandy with the Commission pursuant
to Sections 13 (a), 13 (c), 14 or 15 (d) of the 1934 Act and prior to the filing
of a post-effective amendment which indicates that all securities offered hereby
have been sold or which deregisters all securities then remaining unsold, shall
be deemed to be incorporated by reference in the Registration Statement and to
be 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
herein shall be deemed to be modified or superseded for purposes of this
Registration Statement to the extent that a statement contained herein, or in
any other subsequently filed document, that also is or is deemed to be
incorporated by reference herein, 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 Registration Statement.
Item 4. DESCRIPTION OF SECURITIES
Not Applicable.
Item 5. INTERESTS OF NAMED EXPERTS AND COUNSEL
An opinion concerning the validity of the issuance of shares of Common
Stock has been passed upon for the Registrant by Mark C. Hill, Senior Vice
President, Corporate Secretary and General Counsel of the Registrant. Mr. Hill
beneficially owns or has rights to acquire under employee benefit plans, an
aggregate of less than 1% of shares of Common Stock of the Registrant.
Item 6. INDEMNIFICATION OF OFFICERS AND DIRECTORS
Section 145 of the Delaware General Corporation Law grants corporations
the power to indemnify officers and directors in terms sufficiently broad to
permit such indemnification under certain circumstances for liabilities
(including reimbursement for expenses incurred) arising under the Securities Act
of 1933, as amended (the "Securities Act"). Article XIV of the Registrant's
Restated By-laws provides for indemnification of its directors, officers,
employees and other agents to the maximum extent permitted by Section 145 of the
Delaware General Corporation Law.
Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the Delaware General Corporation Law and the foregoing
by-law provision or otherwise, the Registrant has been advised that in the
opinion of the Commission such indemnification is against public policy as
expressed in the Securities Act and is, therefore, unenforceable. In the event
that a claim for indemnification against such liabilities (other than the
payment by the Registrant of expenses incurred or paid by a director, officer or
controlling person of the Registrant 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 Registrant 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 and will be governed by the final adjudication of such issue.
The Registrant carries directors' and officers' liability insurance
policies under which all of the directors and executive officers of Registrant
are insured against loss imposed upon them with respect to their legal liability
for breach of their duty to Registrant. Excluded from coverage under said policy
are fines and penalties imposed by law upon such directors and officers or other
matters which may be deemed uninsurable such as material acts of active and
deliberate dishonesty committed by the insureds with actual dishonest purpose
and intent. In addition, the Registrant has entered into indemnification
agreements with its directors and certain officers for indemnification to the
fullest extent permitted by applicable law.
In addition, the Tandy Corporation 1999 Incentive Stock Plan provides
that the Registrant will indemnify the members of the Organization and
Compensation Committee of its Board of Directors for all costs and expenses and,
to the extent permitted by applicable law, any liability incurred in connection
with defending against, responding to, negotiation of the settlement of or
otherwise dealing with any claim, cause of action or dispute of any kind arising
in connection with any actions in administering the Tandy Corporation 1999
Incentive Stock Plan or in authorizing or denying authorization to any
transaction thereunder.
Item 7. EXEMPTION FROM REGISTRATION CLAIMED
None Applicable
Item 8. EXHIBITS
Exhibit 3 Articles of Incorporation and By-laws.
Tandy Corporation Restated Certificate of Incorporation, as
amended through February 14, 1992, including Certificates of
Designation for Series A Preferred Stock and Series B Preferred
Stock.
Tandy Corporation Restated By-laws as amended and restated
through December 16, 1998.
Exhibit 4 Instruments defining the rights of security holders.
Tandy Corporation 1999 Incentive Stock Plan.
Exhibit 5 Opinion re legality.
Opinion of Mark C. Hill, Senior Vice President, Corporate
Secretary and General Counsel, as to the legality of the
securities being registered, including consent.
Exhibit 23 Consents of experts and counsel.
PricewaterhouseCoopers LLP, Independent Accountants.
Mark C. Hill, Senior Vice President, Corporate Secretary and
General Counsel (included in Exhibit 5).
Item 9. UNDERTAKINGS
The undersigned Registrant hereby undertakes:
(a)(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this 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;
and/or
(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 paragraphs (a)(1) (i) and (a)(1) (ii) do not
apply if the information required to be included in a post-effective amendment
by those paragraphs is contained in periodic reports filed by the Registrant
pursuant to section 13 or section 15(d) of the 1934 Act that are incorporated by
reference in the Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act, 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.
(3) 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.
(4) The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
Registrant's annual report pursuant to section 13 (a) or section 15(d) of the
1934 Act 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.
(5) The undersigned Registrant hereby undertakes to deliver or cause to
be delivered with the prospectus, to each person to whom the prospectus is sent
or given, the latest annual report to security holders that is incorporated by
reference in the prospectus and furnished pursuant to and meeting the
requirements of Rule 14a-3 or Rule 14c-3 under the 1934 Act; and, where interim
financial information required to be presented by Article 3 of Regulation S-X is
not set forth in the prospectus, to deliver, or cause to be delivered to each
person to whom the prospectus is sent or given, the latest quarterly report that
is specifically incorporated by reference in the prospectus to provide such
interim financial information.
(6) The undertaking regarding indemnification of officers and directors
is included as part of Item 6, which is incorporated into Item 9 by reference.
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 23rd day of
June, 1999.
Tandy Corporation
By: /s/
Leonard H. Roberts, Chairman, President 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 23rd day of June, 1999.
Signature Title
/s/ Chairman, President, Chief Executive Officer
Leonard H. Roberts and Director
/s/ Senior Vice President and Chief Financial Officer
Dwain H. Hughes
/s/ Director
Frank J. Belatti
/s/ Director
James I. Cash, Jr.
/s/ Director
Ronald E. Elmquist
/s/ Director
Lewis F. Kornfeld, Jr.
/s/ Director
Jack L. Messman
/s/ Director
William G. Morton, Jr.
/s/ Director
Thomas G. Plaskett
/s/ Director
Alfred J. Stein
/s/ Director
William E. Tucker
/s/ Director
Edwina O. Woodbury
INDEX TO EXHIBITS
Item.
No.
Exhibit 3 Articles of Incorporation and By-laws.
Tandy Corporation Restated Certificate of Incorporation,
as amended through February 14, 1992, including
Certificates of Designation for Series A Preferred Stock
and Series B Preferred Stock.
Tandy Corporation By-laws as amended and restated through
December 16, 1998.
Exhibit 4 Instruments defining the rights of security holders.
Tandy Corporation 1999 Incentive Stock Plan.
Exhibit 5 Opinion re legality.
Opinion of Mark C. Hill, Senior Vice President, Corporate
Secretary and General Counsel, as to the legality of the
securities being registered, including consent.
Exhibit 23 Consents of experts and counsel.
PricewaterhouseCoopers LLP, Independent Accountants.
Mark C. Hill, Senior Vice President, Corporate Secretary
and General Counsel (included in Exhibit 5).
Exhibit 3
RESTATED CERTIFICATE OF INCORPORATION
OF
TANDY CORPORATION
TANDY CORPORATION, a corporation organized and existing under the laws
of the State of Delaware, hereby certifies as follows:
1. The name of the corporation is TANDY CORPORATION. The date of filing
its original Certificate of Incorporation with the Secretary of State was
December 19, 1967.
2. This Restated Certificate of Incorporation restates and integrates
and does not further amend the provisions of the Certificate of Incorporation of
this corporation as heretofore amended or supplemented, and there is no
discrepancy between the provisions of the original Certificate of Incorporation,
as amended or supplemented, and the provisions of this Restated Certificate of
Incorporation.
3. The text of the Certificate of Incorporation as amended or
supplemented heretofore is hereby restated to read as herein set forth in full:
CERTIFICATE OF INCORPORATION
OF
TANDY CORPORATION
FIRST: The name of the corporation (hereinafter referred to as the
"Corporation") is TANDY CORPORATION.
SECOND: The registered office of the Corporation in the State of Delaware
is located at No. 100 West 10th Street, in the City of Wilmington, County of New
Castle. The registered agent in charge thereof upon whom process against the
Corporation may be served, is The Corporation Trust Company, 100 West 10th
Street, Wilmington, Delaware.
THIRD: The nature of the business of the Corporation and the objects and
purposes to be transacted, promoted and carried on
by it are as follows:
(a) To carry on a general business as manufacturers and merchants, and
to manufacture, produce, finish, treat, cure, tan or otherwise process, buy,
sell, import, export and generally trade and deal in and with any and all kinds
of materials, goods, wares and merchandise.
(b) To subscribe for or cause to be subscribed for, to purchase, invest
in, acquire, hold, own, sell, assign, transfer, mortgage, pledge, exchange,
distribute or otherwise dispose of the whole or any part of the shares of stock,
bonds, mortgages, debentures, notes, coupons, and other securities, obligations,
contracts, and evidences of indebtedness of any corporation, domestic or
foreign, and to issue in exchange therefor its shares of stock, bonds or other
obligations; to exercise in respect to any such shares of stock, bonds or other
securities, any and all rights, powers and privileges of individual owners or
holders, including the right to vote thereon and to aid in any manner permitted
by law any corporation or association of which any bonds or other securities or
evidences of indebtedness or stock are held by the Corporation, and to do any
acts or things designed to protect, preserve, improve or enhance the value of
any such stock, bonds or other securities or evidences of indebtedness, and to
organize or promote or facilitate the organization of subsidiary companies.
(c) To buy, lease or otherwise acquire the goodwill, franchises,
rights, and property, both real, personal and mixed, of any person, firm,
association or corporation, and to pay for the same in cash, property, stocks or
bonds of the Corporation or otherwise and to hold and use or in any manner
dispose of the whole or any part of the property so acquired; to conduct, carry
on, operate, manage, control, improve and develop the whole or any part of any
business or property so acquired, either in the name of such other person or
persons, firm or corporation, and to exercise all the powers necessary or
convenient in and about the conduct and management of such business.
(d) To engage in any lawful act or activity for which corporations may
be organized under the General Corporation Law of the State of Delaware.
(e) To do any and all things necessary, suitable, useful or proper in
the accomplishment of any of the purposes and powers hereinabove set forth,
either as principal or as agent, and in connection therewith to maintain
offices, to appoint agents, to make contracts, to borrow money, to acquire,
hold, mortgage, pledge, lease, sell, grant licenses with respect to or otherwise
dispose of real and personal property, and to do any and all other acts and
things, all to the same extent and as fully as natural persons might or could
lawfully do in any part of the world, but only within the limits permitted to
corporations organized under the General Corporation Law of Delaware.
The foregoing enumeration of purposes, powers and objects shall not be
deemed to limit or restrict in any manner the general powers of the Corporation
under the General Corporation Law of Delaware or the laws of any state,
territory, district or foreign country where the Corporation may be authorized
to do business.
FOURTH: The total number of shares which the Corporation shall have
authority to issue is two hundred fifty-one million (251,000,000) of which one
million (1,000,000) shares without par value shall be Preferred Stock and two
hundred fifty million (250,000,000) shares of the par value of one dollar
($1.00) per share shall be Common Stock. The Preferred Stock shall be issued
from time to time in one or more series with such distinctive serial
designations and (a) may have such voting powers, full or limited, or may be
without voting powers; (b) may be subject to redemption at such time or times
and at such prices; (c) may be entitled to receive dividends (which may be
cumulative or noncumulative) at such rate or rates, on such conditions, and at
such times, and payable in preference to, or in such relation to, the dividends
payable on any other class or classes of stock; (d) may have such rights upon
the dissolution of, or upon any distribution of the assets of, the Corporation;
(e) may be convertible into, or exchangeable for, shares of any other class or
classes or of any other series of the same or any other class or classes of
stock of the Corporation, at such price or prices or at such rates of exchange,
and with such adjustments; and (f) shall have such other relative,
participating, optional or other special rights, qualifications, limitations, or
restrictions thereof, all as shall hereinafter be stated and expressed in the
resolution or resolutions providing for the issue of such Preferred Stock from
time to time adopted by the Board of Directors pursuant to authority so to do
which is hereby granted to and vested in the board.
Each share of Common Stock shall entitle the holder thereof to one vote, in
person or by proxy, at any and all meetings of the stockholders of the
Corporation.
No stockholder, as such, shall have any preemptive right to subscribe for
or purchase any additional shares of stock or securities convertible into or
carrying warrants or options to acquire shares of stock of the Corporation.
Any and all right, title, interest and claim in or to any dividends
declared by the Corporation, whether in cash, stock or otherwise, which are
unclaimed by the stockholder entitled thereto for a period of six years after
the close of business on the payment date, shall be and be deemed to be
extinguished and abandoned; and such unclaimed dividends in the possession of
the Corporation, its transfer agents or other agents or depositaries, shall at
such time become the absolute property of the Corporation, free and clear of any
and all claims of any persons whatsoever.
FIFTH: The number of directors of the Corporation shall be such as from
time to time shall be fixed by or in the manner provided in the bylaws but shall
not be less than three.
SIXTH: In furtherance and not in limitation of the powers conferred by
statute, the Board of Directors is expressly authorized:
(a) To make, alter, amend or repeal the bylaws of the Corporation; to
issue, sell, grant options to purchase and dispose of shares of the authorized
and previously unissued stock of any class of the Corporation and shares of its
outstanding stock of any class held in its treasury; to issue, sell and dispose
of the bonds, debentures, notes and other obligations or evidences of
indebtedness of the Corporation, including bonds, debentures, notes and other
obligations or evidences of indebtedness of the Corporation convertible into
stock of any class of the Corporation; to authorize and cause to be executed
mortgages and liens upon the real and personal property of the Corporation
including after-acquired property; to declare and pay dividends on the stock of
any class of the Corporation; to set apart out of any of the funds of the
Corporation available for dividends or otherwise a reserve or reserves for any
proper purpose and to abolish any such reserve in the manner in which it was
created.
(b) To designate one or more committees, by resolution passed by a
majority of the whole board, each committee to consist of two or more of the
directors of the Corporation, which, to the extent provided in the resolution or
in the bylaws of the Corporation, shall have and may exercise the powers of the
Board of Directors in the management of the business and affairs of the
Corporation, and may authorize the seal of the Corporation to be affixed to all
papers which may require it, and each committee shall have such name as may be
stated in the bylaws of the Corporation or as may be determined from time to
time by resolution adopted by the Board of Directors.
(c) When and as authorized by the affirmative vote of the holders of a
majority of the stock issued and outstanding having voting power given at a
stockholders' meeting duly called for that purpose, or when authorized by the
written consent of the holders of a majority of the voting stock issued and
outstanding, to sell, lease or exchange all of the property and assets of the
Corporation, including its goodwill and its corporate franchises, upon such
terms and conditions and for such consideration, which may be in whole or in
part shares of stock in, and/or other securities of, any other corporation or
corporations, as the Board of Directors shall deem expedient and for the best
interests of the Corporation.
(d) To exercise all other corporate powers and to do all other acts and
things as may be exercised or done by the Corporation, subject, however, to the
provisions of the statutes of the State of Delaware and of this Certificate of
Incorporation and the bylaws of the Corporation.
SEVENTH: Elections of directors need not be by ballot unless the
bylaws of the Corporation shall so provide.
EIGHTH: The Corporation reserves the right to amend, alter, change
or repeal any provision contained in this Certificate of Incorporation, in
the manner now or hereafter prescribed by statute, and all rights conferred
upon stockholders herein are granted subject to the right reserved in this
Article EIGHTH.
4. This Restated Certificate of Incorporation was duly adopted by the
Board of Directors without a vote of the stockholders in accordance with Section
245 of the General Corporation Law of the State of Delaware.
IN WITNESS WHEREOF, said TANDY CORPORATION has caused this Certificate to
be signed by John V. Roach, its Chairman of the Board of Directors and attested
by H. C. Winn, its Secretary this 10th of December, 1982.
TANDY CORPORATION
BY: /s/ John V. Roach
Chairman of the
Board of Directors
ATTEST:
BY: /s/ H. C. Winn
Secretary
CERTIFICATE OF AMENDMENT
OF
CERTIFICATE OF INCORPORATION
TANDY CORPORATION, a corporation organized and existing under and by
virtue of the General Corporation Law of the State of Delaware, DOES HEREBY
CERTIFY:
FIRST: That at a meeting of the Board of Directors of Tandy Corporation
on August 15, 1986, resolutions were duly adopted setting forth a proposed
amendment to the Certificate of Incorporation of said Corporation, declaring
said amendment to be advisable and calling for consideration of said amendment
at the annual meeting of the stockholders of said Corporation on November 13,
1986.
The resolution setting forth the proposed amendment is as follows:
RESOLVED: That the Certificate of Incorporation, as amended, be amended
further by renumbering present Article EIGHTH as Article NINTH, and adding a new
Article EIGHTH thereto, reading in its entirety as follows:
"EIGHTH: The personal liability of the directors of the Corporation is
hereby eliminated to the fullest extent permitted by paragraph (7) of subsection
(b) of Section 102 of the General Corporation Law of Delaware, as the same may
be amended and supplemented. No amendment to or repeal of this Article EIGHTH
shall apply to or have any effect on the liability or alleged liability of any
director of the Corporation for or with respect to any acts or omissions of such
director occurring prior to such amendment or repeal."
SECOND: That thereafter the annual meeting of the stockholders of said
Corporation was held, upon notice in accordance with Section 222 of the General
Corporation Law of the State of Delaware at which meeting the necessary number
of shares as required by statute were voted in favor of the amendment.
THIRD: That said amendment was duly adopted in accordance with the
provisions of Section 242 of the General Corporation Law of the State of
Delaware.
IN WITNESS WHEREOF, said Tandy Corporation has caused this
Certificate to be signed by John V. Roach, its President, and attested
by H. C. Winn, its Secretary, this 19th day of November, 1986.
TANDY CORPORATION
BY: /s/John V. Roach
President
ATTEST:
BY: /s/ H. C. Winn
Secretary
Certificate of Designation
of
Certificate of Incorporation
of
Tandy Corporation
Pursuant to Section 151
of the General Corporation Law of the
State of Delaware
It is hereby certified that:
1. The name of the corporation is Tandy Corporation (hereinafter called
the "Corporation");
2. The Certificate of Incorporation of the Corporation (the
"Certificate of Incorporation"), is hereby amended so that the designation and
number of shares of the class and series acted upon in the following resolution,
and the relative rights, preferences and limitations of such class and series,
are as stated in such resolution;
3. No shares of the Series A Junior Participating Preferred Stock (as
defined below) have been issued; and
4. The following resolution was duly adopted by the Board of Directors
of the Corporation as required by Section 151 of the General Corporation Law of
the State of Delaware at a meeting duly called and held on June 22, 1990:
RESOLVED, that pursuant to the authority granted to and vested in the
Board of Directors of this Corporation in accordance with the provisions of the
Certificate of Incorporation, with respect to the Series of Preferred Stock, no
par value, of the Corporation authorized by the Board of Directors on August 13,
1986, designated the Series A Junior Participating Preferred Stock, the
resolutions of the Board of Directors are hereby amended such that the
designation and amount of the Series A Junior Participating Preferred Stock and
the powers, preferences and relative, participating, optional and other special
rights of the shares of such series, and the qualifications, limitations or
restrictions thereof are as follows:
Section 1. Designation, Par Value and Amount. The shares of such a
series shall be designated as "Series A Junior Participating Preferred Stock"
(hereinafter referred to as "Series A Preferred Stock"), the shares of such
series shall be with no par value, and the number of shares constituting such
series shall be 100,000; provided, however, that, if more than a total of
100,000 shares of Series A Preferred Stock shall be issuable upon the exercise
of Rights (the "Rights") issued pursuant to the Amended and Restated Rights
Agreement, dated as of June 22, 1990, between the Corporation and The First
National Bank of Boston, as Rights Agent (as amended from time to time) (the
"Rights Agreement"), the Board of Directors of the Corporation, pursuant to
Section 151 of the General Corporation Law of the State of Delaware, shall
direct by resolution or resolutions that a certificate be properly executed,
acknowledged and filed providing for the total number of shares of Series A
Preferred Stock authorized to be issued to be increased (to the extent that the
Certificate of Incorporation then permits) to the largest number of whole shares
(rounded up to the nearest whole number) issuable upon exercise of the Rights.
Section 2. Dividends and Distributions.
(A) Subject to the prior and superior rights of the holders of any
shares of any series of Preferred Stock ranking prior and superior to the shares
of Series A Preferred Stock with respect to dividends, the holders of shares of
Series A Preferred Stock shall be entitled to receive, when, as and if declared
by the Board of Directors out of assets legally available for the purpose,
quarterly dividends payable in cash on the fifteenth day of March, June,
September and December in each year (each such date being referred to herein as
a "Quarterly Dividend Payment Date"), commencing on the first Quarterly Dividend
Payment Date after the first issuance of a share or fraction of a share of
Series A Preferred Stock, in an amount per share (rounded to the nearest cent)
equal to the greater of (a) $50 or (b) 1000 times the aggregate per share amount
of all cash dividends, and 1000 times the aggregate per share amount (payable in
kind) of all non-cash dividends or other distributions other than a dividend
payable in shares of Common Stock, par value $1.00 per share, of the Corporation
(the "Common Stock") or a subdivision of the outstanding shares of Common Stock
(by reclassification or otherwise), declared on the Common Stock since the
immediately preceding Quarterly Dividend Payment Date, or, with respect to the
first Quarterly Dividend Payment Date, since the first issuance of any share or
fraction of a share of Series A Preferred Stock.
(B) The Corporation shall declare a dividend or distribution on the
Series A Preferred Stock as provided in paragraph (A) above immediately after it
declares a dividend or distribution on the Common Stock (other than a dividend
payable in shares of Common Stock); provided that, in the event no dividend or
distribution shall have been declared on the Common Stock during the period
between any Quarterly Dividend Payment Date and the next subsequent Quarterly
Dividend Payment Date, a dividend of $50 per share on the Series A Preferred
Stock shall nevertheless be payable on such subsequent Quarterly Dividend
Payment Date.
(C) Dividends shall begin to accrue and be cumulative on outstanding
shares of Series A Preferred Stock from the Quarterly Dividend Payment Date next
preceding the date of issue of such shares of Series A Preferred Stock, unless
the date of issue of such shares is prior to the record date for the first
Quarterly Dividend Payment Date, in which case dividends on such shares shall
begin to accrue from the date of issue of such shares, or unless the date of
issue is a Quarterly Dividend Payment Date or is a date after the record date
for the determination of holders of shares of Series A Preferred Stock entitled
to receive a quarterly dividend and before such Quarterly Dividend Payment Date,
in either of which events such dividends shall begin to accrue and be cumulative
from such Quarterly Dividend Payment Date. Accrued but unpaid dividends shall
not bear interest. Dividends paid on the shares of Series A Preferred Stock in
an amount less than the total amount of such dividends at the time accrued and
payable on such shares shall be allocated pro rata on a share-by-share basis
among all such shares at the time outstanding. The Board of Directors may fix a
record date for the determination of holders of shares of Series A Preferred
Stock entitled to receive payment of a dividend or distribution declared
thereon, which record date shall be not more than 60 days prior to the date
fixed for the payment thereof.
Section 3. Voting Rights. The holders of shares of Series A Preferred
Stock shall have the following voting rights: (A) Each share of Series A
Preferred Stock shall entitle the holder thereof to 1000 votes on all matters
submitted to a vote of the stockholders of the Corporation.
(B) Except as otherwise provided herein or by law, the holders of
shares of Series A Preferred Stock and the holders of shares of Common Stock
shall vote together as one class on all matters submitted to a vote of
stockholders of the Corporation.
(C) Except as set forth herein (or as otherwise required by applicable
law), holders of Series A Preferred Stock shall have no general or special
voting rights and their consent shall not be required for taking any corporate
action.
Section 4. Certain Restrictions.
(A) Whenever quarterly dividends or other dividends or distributions
payable on the Series A Preferred Stock as provided in Section 2 are in arrears,
thereafter and until all accrued and unpaid dividends and distributions, whether
or not declared, on shares of Series A Preferred Stock outstanding shall have
been paid in full, the Corporation shall not:
(i) declare or pay dividends, or make any other distributions, on any
shares of stock ranking junior (either as to dividends or upon liquidation,
dissolution or winding up) to the Series A Preferred Stock;
(ii) declare or pay dividends, or make any other distributions, on any
shares of stock ranking on a parity (either as to dividends or upon liquidation,
dissolution or winding up) with the Series A Preferred Stock, except dividends
paid ratably on the Series A Preferred Stock and all such parity stock on which
dividends are payable or in arrears in proportion to the total amounts to which
the holders of all such shares are then entitled;
(iii) redeem or purchase or otherwise acquire for consideration shares
of any stock ranking junior (either as to dividends or upon liquidation,
dissolution or winding up) to the Series A Preferred Stock, provided that the
Corporation may at any time redeem, purchase or otherwise acquire shares of any
such junior stock in exchange for shares of any stock of the Corporation ranking
junior (either as to dividends or upon dissolution, liquidation or winding up)
to the Series A Preferred Stock;
(iv) redeem or purchase or otherwise acquire for consideration any
shares of Series A Preferred Stock, or any shares of stock ranking on a parity
(either as to dividends or upon liquidation, dissolution or winding up) with the
Series A Preferred Stock, except in accordance with a purchase offer made in
writing or by publication (as determined by the Board of Directors) to all
holders of such shares upon such terms as the Board of Directors, after
consideration of the respective annual dividend rates and other relative rights
and preferences of the respective series and classes, shall determine in good
faith will result in fair and equitable treatment among the respective series or
classes.
(B) The Corporation shall not permit any subsidiary of the Corporation
to purchase or otherwise acquire for consideration any shares of stock of the
Corporation unless the corporation could, under paragraph (A) of this Section 4,
purchase or otherwise acquire such shares at such time and in such manner.
Section 5. Reacquired Shares. Any shares of Series A Preferred Stock
purchased or otherwise acquired by the Corporation in any manner whatsoever
shall be retired and canceled promptly after the acquisition thereof. All such
shares shall upon their cancellation become authorized but unissued shares of
Preferred Stock and may be reissued as part of a new series of Preferred Stock
to be created by resolution or resolutions of the Board of Directors, subject to
the conditions and restrictions on issuance set forth herein, in the Certificate
of Incorporation, in any other Certificate of Amendment creating a series of
Preferred Stock or as otherwise required by law.
Section 6. Liquidation, Dissolution or Winding Up.
(A) With respect to any liquidation, dissolution or winding up
(voluntary or otherwise) of the Corporation, no distribution shall be made to
the holders of shares of stock ranking junior (either as to dividends or upon
liquidation, dissolution or winding up) to the Series A Preferred Stock unless,
prior thereto, the holders of shares of Series A Preferred Stock shall have
received $1000 per share, plus an amount equal to accrued and unpaid dividends
and distributions thereon, whether or not declared, to the date of such payment
(the "Series A Liquidation Preference"). Following the payment of the full
amount of the Series A Liquidation Preference, no additional distributions shall
be made to the holders of shares of Series A Preferred Stock unless, prior
thereto, the holders of shares of Common Stock shall have received an amount per
share (the "Capital Adjustment") equal to the quotient obtained by dividing (i)
the Series A Liquidation Preference by (ii) 1000 (such number in clause (ii),
the "Adjustment Number"). Following the payment of the full amount of the Series
A Liquidation Preference and the Capital Adjustment in respect of all
outstanding shares of Series A Preferred Stock and Common Stock, respectively,
holders of Series A Preferred Stock and holders of Common Stock shall receive
their ratable and proportionate share of the remaining assets to be distributed
in the ratio of the Adjustment Number to 1 with respect to such Preferred Stock
and Common Stock, on a per share basis, respectively.
(B) In the event, however, that there are not sufficient assets
available to permit payment in full of the Series A Liquidation Preference and
the liquidation preferences of all other series of preferred stock, if any,
which rank on a parity with the Series A Preferred Stock, then such remaining
assets shall be distributed ratably to the holders of Series A Preferred Stock
and the holders of such parity shares in proportion to their respective
liquidation preferences. In the event, however, that there are not sufficient
assets available to permit payment in full of the Capital Adjustment, then such
remaining assets shall be distributed ratably to the holders of Common Stock.
Section 7. Consolidation, Merger, etc. In case the Corporation shall
enter into any consolidation, merger, combination or other transaction in which
the shares of Common Stock are exchanged for or changed into other stock or
securities, cash and/or any other property, then in any such case the shares of
Series A Preferred Stock shall at the same time be similarly exchanged or
changed in an amount per share equal to 1000 times the aggregate amount of
stock, securities, cash and/or any other property (payable in kind), as the case
may be, into which or for which each share of Common Stock is changed or
exchanged.
Section 8. No Redemption. The shares of Series A Preferred Stock shall
not be redeemable.
Section 9. Ranking. The Series A Preferred Stock shall rank junior to
all other series of the Corporation's Preferred Stock as to the payment of
dividends and the distribution of assets, unless the terms of any such
series shall provide otherwise.
Section 10. Amendment. The Certificate of Incorporation of the
Corporation shall not be further amended in any manner which would materially
alter or change the powers, preferences or special rights of the Series A
Preferred Stock so as to affect them adversely without the affirmative vote of
the holders of two-thirds or more of the outstanding shares of Series A
Preferred Stock, voting together as a single class.
IN WITNESS WHEREOF, this Certificate of Designation is executed on
behalf of the Corporation by its Chairman of the Board, Chief Executive Officer
and President and attested by its Senior Vice President and Secretary this 22nd
day of June, 1990.
/s/ John V. Roach
- ---------------------------
John V. Roach
Chairman of the Board
Chief Executive Officer and President
Attest:
/s/ Herschel C. Winn
- -------------------------
Herschel C. Winn
Senior Vice President
and Secretary
CERTIFICATE OF DESIGNATIONS
OF
SERIES B TESOP CONVERTIBLE PREFERRED STOCK
of
TANDY CORPORATION
Pursuant to Section 151 of the General Corporation Law of the State of Delaware
We, John V. Roach, Chairman, Chief Executive Officer and President and
Herschel C. Winn, Senior Vice President and Secretary, respectively, of Tandy
Corporation (the "Company"), a corporation organized and existing under the laws
of the State of Delaware, in accordance with the provisions of Section 151 of
the Delaware General Corporation Law, DO HEREBY CERTIFY that, pursuant to the
authority conferred upon the Board of Directors by the Restated Certificate of
Incorporation of the Company, as amended, the Board of Directors authorized the
series of Preferred Stock hereinafter provided for and established the voting
powers thereof and adopted the following resolution creating a series of one
hundred thousand (100,000) shares of Preferred Stock, without par value,
designated as Series B TESOP Convertible Preferred Stock:
RESOLVED: That pursuant to the authority vested in the Board of
Directors of the Company in accordance with the provisions of its Restated
Certificate of Incorporation, as amended, a series of Preferred Stock of the
Company be, and it hereby is, created, and that the designation and amount
thereof and the voting powers, preferences and relative, participating, optional
or other special rights of the shares of such series, and the qualifications,
limitations or restrictions thereof are as follows:
Section 1. Designation and Amount; Special Purpose Restricted Transfer
Issue.
(A) The shares of this series of Preferred Stock shall be designated as
Series B TESOP Convertible Preferred Stock ("Series B Preferred Stock") and the
number of shares constituting such series shall be one hundred thousand
(100,000) shares.
(B) Shares of Series B Preferred Stock shall be issued only to a
trustee acting on behalf of an employee stock ownership plan or other employee
benefit plan of the Company. In the event of any transfer of shares of Series B
Preferred Stock to any person other than the issuance of Series B Preferred
Stock to any such plan trustee, the shares of Series B Preferred Stock so
transferred, upon such transfer and without any further action by the Company or
the holder, shall be automatically converted into shares of Common Stock (as
defined herein) on the terms otherwise provided for the conversion of shares of
Series B Preferred Stock into shares of Common Stock pursuant to Section 5
hereof and no such transferee shall have any of the voting powers, preferences
and relative, participating, optional or other special rights ascribed to shares
of Series B Preferred Stock hereunder but, rather, only the powers and rights
pertaining to the Common Stock into which such shares of Series B Preferred
Stock shall be so converted; provided, however, that the pledge of Series B
Preferred stock by an employee stock ownership plan or other employee benefit
plan of the Company shall not constitute a transfer for the purposes of this
Section 1. Certificates representing shares of Series B Preferred Stock shall be
legended to reflect the ongoing provisions. Notwithstanding the foregoing
provisions of this paragraph (B) of Section 1, shares of Series B Preferred
Stock (i) may be converted into shares of Common Stock as provided by Section 5
hereof and the shared of Common Stock issued upon such conversion may be
transferred by the holder thereof as permitted by law and (ii) shall be
redeemable by the Company upon the terms and conditions provided by Sections 6,
7 and 8 hereof.
Section 2. Dividends and Distributions.
(A) Subject to the provisions for adjustment hereinafter set forth, the
holders of shares of Series B Preferred Stock shall be entitled to receive,
when, as and if declared by the Board of Directors out of funds legally
available therefor, cash dividends ("Preferred Dividends") in an amount per
share equal to $75.00 per share per annum, payable semi-annually in arrears,
one-half on June 30 and one-half on December 31 of each year (each a "Dividend
Payment Date") commencing on December 31, 1990, to holders of record at the
start of business on such Dividend Payment Date; provided, however, that if as
of a given Dividend Payment Date $37.50 is less than an amount (the "Common
Stock Equivalent Dividend") equal to (i) the aggregate amount of all cash
dividends (excluding an amount equal to the Fair Market Value of an
Extraordinary Distribution made during such period as defined in paragraph (G)
of Section 9) declared per share of Common Stock since the immediately preceding
Dividend Payment Date multiplied by (ii) the number of shares of Common Stock
into which such shares of Series B Preferred Stock was convertible at the time
each such dividend was declared (including, without limitation, any and all
adjustments as provided in Section 9 hereof), then the Preferred Dividend
payable for such period shall equal the Common Stock Equivalent Dividend amount.
In the event that any Dividend Payment Date shall fall on any day other than a
"business day" (as hereinafter defined), the dividend payment due on such
Dividend Payment Date shall be paid on the business day immediately preceding
such Dividend Payment Date. Preferred Dividends shall begin to accrue on
outstanding shares of Series B Preferred Stock from the date of issuance of such
shares of Series B Preferred Stock. Preferred Dividends shall accrue on a daily
basis whether or not the Company shall have earnings or surplus at the time.
Preferred Dividends accrued after the date of issuance thereof on the shares of
Series B Preferred Stock for any period less than a full semi-annual period
between Dividend Payment Dates shall be computed on the basis of a 360-day year
of twelve 30-day months. A proportional dividend shall accrue for the period
from the date of issuance until December 31, 1990 and shall be calculated based
on the fixed Preferred Dividend amount. Accrued but unpaid Preferred Dividends
shall cumulate as of the Dividend Payment Date on which they first become
payable, but no interest shall accrue on accumulated but unpaid Preferred
Dividends.
(B) So long as any Series B Preferred Stock shall be outstanding, no
dividend shall be declared or paid or set apart for payment on any other series
of stock ranking on a parity with the Series B Preferred Stock as to dividends,
unless there shall also be or have been declared and paid or set apart for
payment on the Series B Preferred Stock, like dividends for all dividend payment
periods of the Series B Preferred Stock ending on or before the dividend payment
date of such parity stock, ratably in proportion to the respective amounts of
dividends accumulated and unpaid through such dividend payment period on the
Series B Preferred Stock and accumulated and unpaid or payable on such parity
stock through the dividend payment period on such parity stock next preceding
such dividend payment date. In the event that full cumulative dividends on the
Series B Preferred Stock have not been declared and paid or set apart for
payment when due, the Company shall not declare or pay or set apart for payment
any dividends or make any other distributions on, or make any payment on account
of the purchase, redemption or other retirement of, any other class of stock or
series thereof of the Company ranking, as to dividends or as to distributions in
the event of a liquidation, dissolution or winding-up of the Company, junior to
the Series B Preferred Stock until full cumulative dividends on the Series B
Preferred Stock shall have been paid or declared and set aside for payment;
provided, however, that the foregoing shall not apply to (i) any dividend
payable solely in any shares of any stock ranking, as to dividends and as to
distributions in the event of a liquidation, dissolution or winding-up of the
Company, junior to the Series B Preferred stock, or (ii) the acquisition of
shares of any stock ranking, as to dividends or as to distributions in the event
of a liquidation, dissolution or winding-up of the Company, junior to the Series
B Preferred Stock in exchange solely for shares of any other stock ranking as to
dividends and as to distributions in the event of a liquidation, dissolution, or
winding-up of the Company, junior to the Series B Preferred stock.
Section 3. Voting Rights. The holders of shares of Series B Preferred Stock
shall have the following voting rights:
(A) The holders of Series B Preferred Stock shall be entitled to vote
on all matters submitted to a vote of the holders of Common Stock of the
Company, voting together with the holders of Common Stock as one class. Each
share of the Series B Preferred Stock shall be entitled to the number of votes
equal to the number of shares of Common Stock into which such shares of Series B
Preferred Stock could be converted on the record date for determining the
stockholders entitled to vote, rounded to the nearest one-tenth of a vote; it
being understood that whenever the "Conversion Price" (as defined in Section 5
(A) hereof) is adjusted as provided in Section 9 hereof, the voting rights of
the Series B Preferred Stock shall also be similarly adjusted.
(B) Except as otherwise required by law or set forth herein, holders of
Series B Preferred Stock shall have no special voting rights and their consent
shall not be required (except to the extent they are entitled to vote with
holders of Common Stock as set forth herein) for the taking of any corporate
action.
(C) The Restated Certificate of Incorporation, as amended, of the
Company or this Resolution (including, without limitation, any such alteration,
amendment or repeal effected by any merger or consolidation in which the Company
is a surviving or resulting corporation) shall not be amended in any manner that
would materially alter or change the powers, preferences or special rights of
the Series B Preferred Stock so as to affect the holders thereof adversely
without the affirmative vote of the holders of two-thirds of the outstanding
shares of Series B Preferred Stock, voting together as a single class.
Section 4. Liquidation, Dissolution or Winding Up.
(A) Upon any voluntary or involuntary liquidation, dissolution or
winding up of the Company, the holders of Series B Preferred Stock shall be
entitled to receive out of the assets of the Company which remain after
satisfaction in full of all valid claims of creditors of the Company and which
are available for payment to stockholders and subject to the rights of the
holders of any stock of the Company ranking senior to or on a parity with the
Series B Preferred Stock in respect of distributions upon liquidation,
dissolution or winding up of the Company, before any amount shall be paid or
distributed among the holders of Common Stock or any other shares ranking junior
to the Series B Preferred Stock in respect of distributions upon liquidation,
dissolution or winding up of the Company, liquidating distributions in the
amount of $1,000 per share (the "Liquidation Price"), plus an amount equal to
all accrued and unpaid dividends thereon to the date fixed for distribution, and
no more. If, upon any liquidation, dissolution or winding up of the Company, the
amounts payable with respect to the Series B Preferred Stock and any other
parity stock ranking as to any such distribution on a parity with the Series B
Preferred Stock are not paid in full, the holders of the Series B Preferred
Stock and such other stock shall share ratably in any distribution of assets in
proportion to the full respective preferential amounts to which they are
entitled. After payment of the full amounts to which they are entitled as
provided by the foregoing provisions of this Section 4(A), the holders of shares
of Series B Preferred Stock shall not be entitled to any further right or claim
to any of the remaining assets of the Company.
(B) Neither the merger or consolidation of the Company with or into any
other corporation, nor the merger or consolidation of any other corporation with
or into the Company, nor the sale, transfer or lease of all or any portion of
the assets of the Company, shall be deemed to be a dissolution, liquidation or
winding up of the affairs of the Company for purposes of this Section 4, but the
holders of Series B Preferred Stock shall nevertheless be entitled in the event
of any such merger or consolidation to the rights provided by Section 8 hereof.
(C) Written notice of any voluntary or involuntary liquidation,
dissolution or winding up of the Company, stating the payment date or dates
when, and the place or places where, the amounts distributable to holders of
Series B Preferred Stock in such circumstances shall be payable, shall be given
by first-class mail, postage prepaid, mailed not less than twenty (20) days
prior to any payment date stated therein, to the holders of Series B Preferred
Stock, at the address shown on the books of the Company or any transfer agent
for the Series B Preferred Stock.
Section 5. Conversion into Common Stock.
(A) A holder of shares of Series B Preferred Stock shall be entitled,
at any time (but not after the close of business on a date fixed for redemption
of such shares pursuant to Sections 6, 7 and 8 hereof), to cause any or all of
such shares to be converted into shares of Common Stock, initially at a
conversion rate equal to the ratio of (i) $1,000 to (ii) the amount which (A)
initially shall be equal to 125% of the Fair Market Value (as defined herein) of
the Common Stock on the date of issuance of the Series B Preferred Stock, and
(B) shall be adjusted as hereinafter provided (such amount, as it may be so
adjusted from time to time, is hereinafter sometimes referred to as the
"Conversion Price").
(B) Any holder of shares of Series B Preferred Stock desiring to
convert such shares into shares of Common Stock shall surrender the certificate
or certificates representing the shares of Series B Preferred Stock being
converted, duly assigned or endorsed for transfer to the Company (or accompanied
by duly executed stock powers relating thereto), at the principal executive
office of the Company or the offices of the transfer agent for the Series B
Preferred Stock or such office or offices in the continental United States of an
agent for conversion as may from time to time be designated by notice to the
holders of the Series B Preferred Stock by the Company or the transfer agent for
the Series B Preferred Stock, accompanied by written notice of conversion. Such
notice of conversion shall specify (i) the number of shares of Series B
Preferred Stock to be converted and the name or names in which such holder
wishes the certificate or certificates for Common Stock and for any shares of
Series B Preferred Stock not to be so converted to be issued, and (ii) the
address to which such holder wishes delivery to be made of such new certificates
to be issued upon such conversion.
(C) Upon surrender of a certificate representing a share or shares of
Series B Preferred Stock for conversion, the Company shall issue and send by
hand delivery (with receipt to be acknowledged) or by first class mail, postage
prepaid, to the holder thereof or to such holder's designee, at the address
designated by such holder, a certificate or certificates for the number of
shares of Common Stock to which such holder shall be entitled upon conversion.
In the event that there shall have been surrendered a certificate or
certificates representing shares of Series B Preferred Stock, only part of which
are to be converted, the Company shall issue and deliver to such holder or such
holder's designee a new certificate or certificates representing the number of
shares of Series B Preferred Stock which shall not have been converted.
(D) The issuance by the Company of shares of Common Stock upon a
conversion of shares of Series B Preferred Stock into shares of Common Stock
made at the option of the holder thereof shall be effective as of the earlier of
(i) the delivery to such holder or such holder's designee of the certificates
representing the shares of Common Stock issued upon conversion thereof or (ii)
the commencement of business on the second business day after the surrender of
the certificate or certificates for the shares of Series B Preferred Stock to be
converted, duly assigned or endorsed for transfer to the Company (or accompanied
by duly executed stock powers relating thereto) as provided by this Resolution.
On and after the effective day of conversion, the person or persons entitled to
receive the Common Stock issuable upon such conversion shall be treated for all
purposes as the record holder or holders of such shares of Common Stock, but no
allowance or adjustment shall be made in respect of dividends payable to holders
of Common Stock in respect of any period prior to such effective date. The
Company shall not be obligated to pay any dividends which shall have been
declared and shall be payable to holders of shares of Series B Preferred Stock
on a Dividend Payment Date if such Dividend Payment Date for such dividend shall
coincide with or be on or subsequent to the effective date of conversion of such
shares.
(E) The Company shall not be obligated to deliver to holders of Series
B Preferred Stock any fractional share or shares of Common Stock issuable upon
any conversion of such shares of Series B Preferred Stock, but in lieu thereof
may make a cash payment in respect thereof in any manner permitted by law.
(F) The Company shall at all times reserve and keep available out of
its authorized and unissued Common Stock, or Common Stock held as Treasury
Stock, solely for issuance upon the conversion of shares of Series B Preferred
Stock as herein provided, free from any preemptive rights, such number of shares
of Common Stock as shall from time to time be issuable upon the conversion of
all the shares of Series B Preferred Stock then outstanding. Nothing contained
herein shall preclude the Company from issuing shares of Common Stock held in
its treasury upon the conversion of shares of Series B Preferred Stock into
Common Stock pursuant to the terms hereof. The Company shall prepare and shall
use its best efforts to obtain and keep in force such governmental or regulatory
permits or other authorizations as may be required by law, and shall comply with
all requirements as to registration or qualification of the Common Stock, in
order to enable the Company lawfully to issue and deliver to each holder of
record of Series B Preferred Stock such number of shares of its Common Stock as
shall form time to time be sufficient to effect the conversion of all shares of
Series B Preferred Stock then outstanding and convertible into shares of Common
Stock.
(G) The Company has entered into an Amended Restated Shareholder Rights
Agreement dated as of June 22, 1990 (the "Rights Agreement") governing the
issuance to holders of Common Stock of rights to purchase capital stock or other
securities of the Company. Whenever the Company shall issue shares of Common
Stock as contemplated by this Section 5, the Company shall comply with the terms
of the Rights Agreement or any successor rights agreement and applicable
resolutions of the Board of Directors relating to rights dividends with respect
to the issuance of rights together with the issuance of such shares of Common
Stock.
Section 6. Redemption At the Option of the Company.
(A) The Series B Preferred Stock shall be redeemable, in whole or in
part, at the option of the Company at any time after July 1, 1994, or on or
before July 1, 1994 if permitted by paragraph (D) of this Section 6, at the
following redemption prices per share, expressed as a percentage of the
Liquidation Price per share:
During the Twelve-
Month Period Price Per
Beginning July 1, Share
1990 107.50%
1991 106.75%
1992 106.00%
1993 105.25%
1994 104.50%
1995 103.75%
1996 103.00%
1997 102.25%
1998 101.50%
1999 100.75%
2000 100.00%
and thereafter at $1,000 per share, plus, in each case, an amount equal to all
accrued and unpaid dividends thereon to the date fixed for redemption. Payment
of the redemption price shall be made by the Company in cash or shares of Common
Stock, or a combination thereof, as permitted by paragraph (E) of this Section
6. From and after the date fixed for redemption, dividends on shares of Series B
Preferred Stock called for redemption will cease to accrue, such shares will no
longer be deemed to be outstanding and all rights in respect of such shares of
the Company shall cease, except the right to receive the redemption price. If
less than all of the outstanding shares of Series B Preferred Stock are to be
redeemed, the Company shall either redeem a portion of the shares of each holder
determined pro rata based on the number of shares held by each holder or shall
select the shares to be redeemed, by lot, as may be determined by the Board of
Directors of the Company.
(B) Unless otherwise required by law, notice of redemption for any
redemption made pursuant to this Section 6 will b sent to the holders of Series
B Preferred Stock at the address shown on the books of the Company or any
transfer agent for the Series B Preferred Stock by first class mail, postage
prepaid, mailed not less than twenty (20) days nor more than sixty (60) days
prior to the redemption date. Each such notice shall state: (i) the redemption
date; (ii) the total number of shares of the Series B Preferred Stock to be
redeemed and, if fewer than all the shares held by such holder are to be
redeemed, the number of such shares to be redeemed from such holder; (iii) the
redemption price; (iv) the place or places where certificates for such shares
are to be surrendered for payment of the redemption price; (v) that dividends on
the shares to be redeemed will cease to accrue on such redemption date; and (vi)
the conversion rights of the shares to be redeemed, the period within which
conversion rights may be exercised (which shall be no less than twenty (20)
days), and the Conversion Price and number of shares of Common Stock issuable
upon conversion of a share of Series B Preferred Stock on the date such notice
is sent. The foregoing notice provisions may be amended, if necessary, so as to
comply with the optional redemption provisions for preferred stock as
"qualifying employer securities" or "employer securities" within the meaning of
Sections 4975(e)(8) and 409(1) of the Internal Revenue Code of 1986, as amended
(the "Code"), or under any successor provision thereof or as "qualifying
employer securities" under Section 407(d)(5) of the Employee Retirement Income
Security Act of 1974, as amended ("ERISA") or under any successor provision
thereof. Upon surrender of the certificates for any shares so called for
redemption and not previously converted (properly endorsed or assigned for
transfer, if the Board of Directors of the Company shall so require and the
notice shall so state), such shares shall be redeemed by the Company at the date
fixed for redemption and at the redemption price set forth in this Section 6.
(C) (i) In the event of a change in the federal tax laws of the United
States of America (or any regulations or rulings promulgated thereunder), or any
change in the application, enforcement or interpretation in respect of such
laws, regulations or rulings, including any of the foregoing taken by a court of
competent jurisdiction, which has the effect of precluding the Company from
claiming any of the tax deductions for dividends paid on the Series B Preferred
Stock (other than a change treating the dividends as a preference item for
purposes of determining alternative minimum tax) when such dividends are used as
provided under Section 404(k)(2) of the Code and in effect on the date shares of
Series B Preferred Stock are initially issued, or (ii) upon a determination by
the Internal Revenue Service that the Company's employee stock ownership plan
(the "Plan"), as amended, or any successor plan is not qualified under Sections
401(a), 401(k) and 4975(e)(7) of the Code, the Company may, in its sole
discretion and notwithstanding anything to the contrary in paragraph (A) of this
Section 6, elect to redeem such shares for the amount payable in respect of the
shares upon liquidation of the Company pursuant to Section 4 hereof. Notice of
such redemption shall be provided in accordance with the procedures set forth in
paragraph (B) of this Section 6, provided, however, that notice of redemption
for any redemption made pursuant to clause (i) of this paragraph 6(C) shall be
mailed not more than ninety (90) days after the later to occur of (i) the
effective date, or (ii) the date of enactment, of the change permitting such
redemption.
(D) If the Company terminates or partially terminates the Plan, then,
notwithstanding anything to the contrary in paragraph (A) of this Section 6, the
Company may elect to redeem and all of the shares of Series B Preferred Stock at
any time prior to July 1, 1994, on the terms and conditions set forth in
paragraphs (A) and (B) of this Section 6.
(E) The Company shall make payment of the redemption price required
upon redemption of shares of Series B Preferred Stock in cash, or if the Company
so elects, in shares of Common Stock, or in a combination of such shares and
cash, any such shares to be valued for such purposes at their Fair Market Value
(as defined in paragraph (G) of Section 9 hereof). Notwithstanding anything
herein to the contrary (including Section 7 hereof), in the event that the
company elects, by a resolution of its Board of Directors, to make payment of
all future redemption prices solely in cash or solely in shares of Common Stock
of the Company and notifies the holders of Series B Preferred Stock of such
election, all such payments thereafter shall be made in compliance with such
election and such election shall be irrevocable.
Section 7. Other Redemption Rights.
For consideration as provided in paragraph (E) of Section 6, shares of
Series B Preferred Stock shall be redeemed by the Company at a redemption price
equal to the greater of the Fair Market Value (as hereinafter defined) or the
Liquidation Price of the Series B Preferred Stock plus an amount equal to all
accrued and unpaid dividends thereon to the date fixed for redemption, at the
option of the holder, at any time and from time to time upon notice to the
Company given not less than five (5) business days prior to the date fixed by
the holder in such notice for such redemption, when and to the extent necessary
(i) for such holder to provide for distributions required to be made to
participants under, or to satisfy an investment election provided to
participants in accordance with, the Plan, or any successor Plan, (ii) for such
holder to make payment of principal, interest or premium due and payable
(whether as scheduled or upon acceleration) on indebtedness of the trust under
such Plan or any indebtedness incurred by the holder or the benefit of the Plan,
or (iii) when and if it shall be established to the satisfaction of the holder
that the Plan has not initially been determined by the Internal Revenue Service
to be qualified as an employee stock ownership plan within the meaning of
Sections 401(a) or 4975(e)(7) of the Code, respectively.
Section 8. Consolidation, Merger, etc.
(A) In the event that the Company shall consummate any consolidation,
merger or similar business transaction, however named, pursuant to which the
outstanding shares of Common Stock are by operation of law exchanged solely for
or changed, reclassified or converted solely into stock of any successor or
resulting company (including the Company) that constitutes "employer securities"
with respect to a holder of Series B Preferred Stock (within the meaning of
Section 409 (1) of the Code) and "qualifying employer securities" (within the
meaning of Section 407(d)(5) of ERISA, or any successor provisions of law) and,
if applicable, for a cash payment in lieu of fractional shares, if any, the
shares of Series B Preferred Stock of such holder shall be assumed and shall
become preferred stock of such successor or resulting company, having in respect
of such company insofar as possible the same powers, preferences and relative,
participating, optional or other special rights (including the redemption rights
provided by Sections 6, 7 and 8 hereof), and the qualifications, limitations or
restrictions thereon, that the Series B preferred Stock had immediately prior to
such transaction, except that after such transaction each share of the Series B
Preferred Stock shall be convertible, otherwise on the terms and conditions
provided by Sections 5 and 7 hereof, into the number and kind of qualifying
employer securities so receivable by a holder of the number of shares of Common
Stock into which such shares of Series B Preferred Stock could have been
converted immediately prior to such transaction if such holder of Common Stock
failed to exercise any rights of election to receive any kind or amount of
stock, securities, cash or other property (other than such qualifying employer
securities and a cash payment, if applicable, in lieu of fractional shares;
receivable upon such transaction (provided that, if the kind or amount of
qualifying employer securities receivable upon such transaction is not the same
for each non-electing share of Common Stock, then the kind and amount of
qualifying employer securities receivable upon such transaction for each
non-electing share of Common Stock shall be the kind and amount so receivable
per share by a plurality of the non-electing shares of Common Stock). The rights
of the Series B Preferred Stock as preferred stock of such successor or
resulting company shall successively be subject to adjustments pursuant to
Section 9 hereof after any such transaction as nearly equivalent to the
adjustments provided for by such section prior to such transaction. The Company
shall not merger, consolidation or similar transaction unless all then
outstanding shares of the Series B Preferred Stock shall be assumed and
authorized by the successor or resulting company as aforesaid.
(B) In the event that the Company shall consummate any consolidation or
merger or similar transaction, however named, pursuant to which the outstanding
shares of Common Stock are by operation of law exchanged for or changed,
reclassified or converted into other stock or securities or cash or any other
property, or any combination thereof, other than any such consideration which is
constituted solely of qualifying employer securities (as referred to in
paragraph (A) of this Section 8) and cash payments, if applicable, in lieu of
fractional shares, outstanding shares of Series B Preferred Stock shall, without
any action on the part of the Company or any holder thereof (but subject to
paragraph (C) of this Section 8), be automatically converted by virtue of such
merger, consolidation or similar transaction immediately prior to such
consummation into the number of shares of Common Stock into which such shares of
Series B Preferred Stock could have been converted at such time so that each
share of Series B Preferred Stock shall, be virtue of such transaction and on
the same terms as apply to the holders of Common Stock, be converted into or
exchanged for the aggregate amount of stock, securities, cash or other property
(payable in like kind) receivable by a holder of the number of shares of Common
Stock into which such shares of Series B Preferred Stock could have been
converted immediately prior to such transaction if such holder of Common Stock
failed to exercise any rights of election as to the kind or amount of stock,
securities, cash or other property receivable upon such transaction (provided
that, if the kind or amount of stock, securities, cash or other property
receivable upon such transaction is not the same for each non-electing share of
Common Stock, then the kind and amount of stock, securities, cash or other
property receivable upon such transaction for each non-electing share of Common
Stock shall be the kind and amount so receivable per share by a plurality of the
non-electing shares of Common Stock).
(C) In the event the Company shall enter into any agreement providing
for any consolidation, merger, or similar transaction described in paragraph (B)
of this Section 8, then the Company shall as soon as practicable thereafter (and
in any event at least ten (10) business days before consummation of such
transaction) give notice of such agreement and the material terms thereof to
each holder of Series B Preferred Stock and each such holder shall have the
right to elect, by written notice to the Company, to receive, upon consummation
of such transaction (if and when such transaction is consummated), from the
Company or the successor of the Company, out of funds legally available
therefor, in redemption and retirement of such Series B Preferred Stock, a cash
payment equal to the amount payable in respect of shares of Series B Preferred
Stock upon redemption pursuant to paragraph (A) of Section 6 hereof. No such
notice of redemption shall be effective unless given to the Company prior to the
close of business on the second business day prior to consummation of such
transaction, unless the Company of the successor of the Company shall waive such
prior notice, but any notice of redemption so given prior to such time may be
withdrawn by notice of withdrawal given to the Company prior to the close of
business on the second business day prior to consummation of such transaction.
Section 9. Anti-dilution Adjustments.
(A) In the event the Company shall, at any time or from time to time
while any of the shares of Series B Preferred Stock are outstanding, (i) pay a
dividend or make a distribution in respect of the Common Stock in shares of
Common Stock, (ii) subdivide the outstanding shares of Common Stock, or (iii)
combine the outstanding shares of Common Stock into a smaller number of shares,
in each case whether by reclassification of shares, recapitalization of the
Company (including a recapitalization effected by a merger or consolidation to
which Section 8 hereof does not apply; or otherwise, subject to the provisions
of subparagraphs E and F of this Section 9, the Conversion Price in effect
immediately prior to such action shall be adjusted by multiplying such
Conversion Price by the fraction, the numerator of which is the number of shares
of Common Stock outstanding immediately before such event and the denominator of
which is the number of shares of Common Stock outstanding immediately after such
event. An adjustment made pursuant to this paragraph 9(A) shall be given effect,
upon payment of such a dividend or distribution, as of the record date for the
determination of shareholders entitled to receive such dividend or distribution
(on a retroactive basis) and in the case of a subdivision or combination shall
become effective immediately as of the effective date thereof.
(B) In the event that the Company shall, at any time or from time to
time while any of the shares of Series B Preferred Stock are outstanding, issue
to holders of shares of Common Stock as a dividend or distribution, including by
way of a reclassification of shares or a recapitalization of the Company, any
right or warrant to purchase shares of Common Stock (but not including as such a
right or warrant (i) any security convertible into or exchangeable for shares of
Common Stock or (ii) any rights issued pursuant to or governed by the Rights
Agreement or any successor rights agreement thereto) at a purchase price per
share less than the Fair Market Value (as hereinafter defined) of a share of
Common Stock on the date of issuance of such right or warrant, then, subject to
the provisions of paragraphs (E) and (F) of this Section 9, the Conversion Price
shall be adjusted by multiplying such Conversion Price by the fraction, the
numerator of which shall be the number of shares of Common Stock outstanding
immediately before such issuance of rights or warrants plus the number of shares
of Common Stock which could be purchased at the Fair Market Value of a share of
Common Stock at the time of such issuance for the maximum aggregate
consideration payable upon exercise in full of all such rights or warrants and
the denominator of which shall be the number of shares of Common Stock
outstanding immediately before such issuance of rights or warrants plus the
maximum number of shares of Common Stock that could be acquired upon exercise in
full of all such rights and warrants.
(C) In the event the Company shall, at any time or from time to time
while any of the shares of Series B Preferred Stock are outstanding, issue, sell
or exchange shares of Common Stock (other than pursuant to (i) any right or
warrant to purchase or acquire shares of Common Stock (including as such a right
or warrant any security convertible into or exchangeable for shares of Common
Stock), (ii) any rights issued pursuant to or governed by the Rights Agreement
or any successor rights agreement, and (iii) any employee or director incentive
or benefit plan or arrangement, including any employment, severance or
consulting agreement, of the Company or any subsidiary of the Company heretofore
or hereafter adopted) for a consideration having a Fair Market Value of Common
Stock on the date of such issuance, sale or exchange less than the Fair Market
Value of such shares of Common Stock on the date of such issuance, sale or
exchange, then, subject to the provisions of paragraphs (E) and (F) of this
Section 9, the Conversion Price shall be adjusted by multiplying such Conversion
Price by the fraction the numerator of which shall be the sum of (i) the Fair
Market Value of all the shares of Common Stock outstanding on the day
immediately preceding the first public announcement of such issuance, sale or
exchange plus (ii) the Fair Market Value of the consideration received by the
Company in respect of such issuance, sale or exchange of shares of Common Stock,
and the denominator of which shall be the product of (i) the Fair Market Value
of a share of Common Stock on the day immediately preceding the first public
announcement of such issuance, sale or exchange multiplied by (ii) the sum of
the number of shares of Common Stock outstanding on such day plus the number of
shares of Common Stock so issued, sold or exchanged by the Company. In the event
the Company shall, at any time or from time to time while any shares of Series B
Preferred Stock are outstanding, issue, sell or exchange any right or warrant to
purchase or acquire shares of Common Stock (including as such a right or warrant
any security convertible into or exchangeable for shares of Common Stock), other
than any such issuance (i) to holders of shares of Common Stock as a dividend or
distribution (including by way of a reclassification of shares or a
recapitalization of the Company), (ii) of rights issued pursuant to or governed
by the Rights Agreement or any successor rights agreement thereto, and (iii)
pursuant to any employee or director incentive or benefit plan or arrangement
(including any employment, severance or consulting agreement) of the Company or
any subsidiary of the Company heretofore or hereafter adopted, for a
consideration having a Fair Market Value on the date of such issuance, sale or
exchange less than the Non-Dilutive Amount (as hereinafter defined), then,
subject to the provisions of paragraphs (E) and (F) of this Section 9, the
Conversion Price shall be adjusted by multiplying such Conversion Price by the
fraction the numerator of which shall be the sum of (i) the Fair Market Value of
all the shares of Common Stock outstanding on the day immediately preceding the
first public announcement of such issuance, sale or exchange plus (ii) the Fair
Market Value of the consideration received by the Company in respect of such
issuance, sale or exchange of such right or warrant plus (iii) the Fair Market
Value at the time of such issuance of the consideration which the Company would
receive upon exercise in full of all such rights or warrants, and the
denominator of which shall be the product of (i) the Fair Market Value of a
share of Common Stock on the day immediately preceding the first public
announcement of such issuance, sale or exchange multiplied by (ii) the sum of
the number of shares of Common Stock outstanding on such day plus the maximum
number of shares of Common Stock which could be acquired pursuant to such right
or warrant at the time of the issuance, sale or exchange of such right or
warrant (assuming shares of Common Stock could be acquired pursuant to such
right or warrant at such time).
(D) In the event the Company shall, at any time or from time to time
while any of the shares of Series B Preferred Stock are outstanding, make an
Extraordinary Distribution (as hereinafter defined) in respect of the Common
Stock, whether by dividend, distribution, reclassification of shares or
recapitalization of the Company (including a recapitalization or
reclassification effected by a merger or consolidation to which Section 8 hereof
does not apply) or effect a Pro Rata Repurchase (as hereinafter defined) of
Common Stock, the Conversion Price in effect immediately prior to such
Extraordinary Distribution or Pro Rata Repurchase shall, subject to paragraphs
(E) and (F) of this Section 9, be adjusted by multiplying such Conversion Price
by the fraction, the numerator of which is (i) the product of (x) the number of
shares of Common Stock outstanding immediately before such Extraordinary
Distribution or Pro Rata Repurchase multiplied by (y) the Fair Market Value (as
herein defined) of a share of Common Stock on the day before the ex-dividend
date with respect to an Extraordinary Distribution which is paid in cash and on
the distribution date with respect to an Extraordinary Distribution which is
paid other than in cash, or on the applicable expiration date (including all
extensions thereof) of any tender offer which is a Pro Rata Repurchase, or on
the date of purchase with respect to any Pro Rata Repurchase which is not a
tender offer, as the case may be, minus (ii) the Fair Market Value of the
Extraordinary Distribution or the aggregate purchase price of the Pro Rata
Repurchase, as the case may be, and the denominator of which shall be the
product of (A) the number of shares of Common Stock outstanding immediately
before such Extraordinary Dividend or Pro Rata Repurchase minus, in the case of
a Pro Rata Repurchase, the number of shares of Common Stock repurchased by the
Company multiplied by (B) the Fair Market Value of a share of Common Stock on
the day before the ex-dividend date with respect to an Extraordinary
Distribution which is paid in cash and on the distribution date with respect to
an Extraordinary Distribution which is paid other than in cash or on the
applicable expiration date (including all extensions thereof) of any tender
offer which is a Pro Rata Repurchase or on the date of purchase with respect to
any Pro Rata Repurchase which is not a tender offer, as the case may be. The
Company shall send each holder of Series B Preferred Stock (i) notice of its
intent to make any dividend or distribution and (ii) notice of any offer by the
Company to make a Pro Rata Repurchase, in each case at the same time as, or as
soon as practicable after, such offer is first communicated (including by
announcement of a record date in accordance with the rules of any stock exchange
on which the Common Stock is listed or admitted to trading) to holders of Common
Stock. Such notice shall indicate the intended record date and the amount and
nature of such dividend or distribution, or the number of shares subject to such
offer for a Pro Rata Repurchase and the purchase price payable by the Company
pursuant to such offer, as well as the Conversion Price and the numbers of
shares of Common Stock into which a share of Series B Preferred Stock may be
converted at such time.
(E) Notwithstanding any other provisions of this Section 9, the Company
shall not be required to make any adjustment of the Conversion Price unless such
adjustment would require an increase or decrease of at least one percent (1%) in
the Conversion Price. Any lesser adjustment shall be carried forward and shall
be made no later than the time of, and together with, the next subsequent
adjustment which, together with any adjustment or adjustments so carried
forward, shall amount to an increase or decrease of at least one percent (1%) in
the Conversion Price.
(F) If the Company shall make any dividend or distribution on the
Common Stock or issue any Common Stock, other capital stock or other security of
the Company or any rights or warrants to purchase or acquire any such security,
which transaction does not result in an adjustment to the Conversion Price
pursuant to the foregoing provisions of this Section 9, the Board of Directors
of the Company shall consider whether such action is of such a nature that an
adjustment to the Conversion Price should equitably be made in respect of such
transaction. If in such case the Board of Directors of the Company determines
that an adjustment to the Conversion Price should be made, an adjustment shall
be made effective as of such date, as determined by the Board of Directors of
the Company, which adjustment shall in no event adversely effect the powers,
preferences or special rights of the Series B Preferred Stock as set forth
herein. The determination of the Board of Directors of the Company as to whether
an adjustment to the Conversion Price should be made pursuant to the foregoing
provisions of this paragraph 9(F), and, if so, as to what adjustment should be
made and when, shall be final and binding on the Company and all stockholders of
the Company. The Company shall be entitled to make such additional adjustments
in the Conversion Price, in addition to those required by the foregoing
provisions of this Section 9, as shall be necessary in order that any dividend
or distribution in shares of capital stock of the Company, subdivision,
reclassification or combination of shares of stock of the Company or any
recapitalization of the Company shall not be taxable to holders of the Common
Stock.
(G) For purposes of this Resolution, the following definitions shall
apply: The term "business day" shall mean each day that is not a Saturday,
Sunday or a day on which state or federally chartered banking institutions in
New York, New York or Fort Worth, Texas are not required to be open.
"Extraordinary Distribution" shall mean any dividend or other
distribution to holders of Common stock (effected while any of the shares of
Series B Preferred Stock are outstanding) (i) of cash, where the aggregate
amount of such cash dividend or distribution together with the amount of all
cash dividends and distributions made during the preceding period of 12 months,
when combined with the aggregate amount of all Pro Rata Repurchases (for this
purpose, including only that portion of the aggregate purchase price of such Pro
Rata Repurchase which is in excess of the Fair Market Value of the Common Stock
repurchased as determined on the applicable expiration date, including all
extensions thereof, of any tender offer or exchange offer which is a Pro Rata
Repurchase, or the date of purchase with respect to any other Pro Rata
Repurchase which is not a tender offer or exchange offer made during such
period), exceeds ten percent (10%) of the aggregate Fair Market Value of all
shares of Common Stock outstanding on the record date for determining the
shareholders entitled to receive such Extraordinary Distribution and (ii) of any
shares of capital stock of the Company (other than shares of Common Stock),
other securities of the Company (other than securities of the type referred to
in paragraph (B) of this Section 9), evidences of indebtedness of the Company or
any other person or any other property (including shares of any subsidiary of
the Company), or any combination thereof. The Fair Market Value of an
Extraordinary Distribution for purposes of paragraph (D) of this Section 9 shall
be the sum of the Fair Market Value of such Extraordinary Distribution plus the
amount of any cash dividends which are not Extraordinary Distributions made
during such twelve month period and not previously included in the calculation
of an adjustment pursuant to paragraph (D) of this Section 9.
"Fair Market Value" shall mean, as to shares of Common Stock or any
other class of capital stock or securities of the Company or any other issuer
which are publicly traded, the average of the Current Market Prices (as
hereinafter defined) of such shares or securities for each day of the Adjustment
Period (as hereinafter defined). "Current Market Price" of publicly traded
shares of Common Stock or any other class of capital stock or other security of
the Company or any other issuer for a day shall mean (i) for purposes of
Sections 6 and 7 hereof, the mean between the highest and lowest reported sales
price on such day and (ii) for all other purposes hereof, the last reported
sales price, regular way, or, in case no sale takes place on such day, the
average of the reported closing bid and asked prices, regular way, in either
case as reported on the New York Stock Exchange Composite Tape or, if such
security is not listed or admitted to trading on the New York Stock Exchange, on
the principal national securities exchange on which such security is listed or
admitted to trading or, if not listed or admitted to trading on any national
securities exchange, on the NASDAQ National Market System or, if such security
is not quoted on such National Market System, the average of the closing bid and
asked prices on each such day in the over-the-counter market as reported by
NASDAQ or, if bid and asked prices for such security on each such day shall not
have been reported through NASDAQ, the average of the bid and asked prices for
such day as furnished by any New York Stock Exchange member firm regularly
making a market in such security selected for such purpose by the Board of
Directors of the Company or a committee thereof on each trading day during the
Adjustment Period.
"Adjustment Period" shall mean the period of five (5) consecutive
trading days, selected by the Board of Directors of the Company or a committee
thereof in a manner determined by such Board of Directors or committee to be
most favorable to the holders of the Series B Preferred Stock, during the twenty
(20) trading days preceding, and including, the date as of which the Fair Market
Value of a security is to be determined. The "Fair Market Value" of any security
(except with respect to the Series B Preferred Stock) which is not publicly
traded or of any other property shall mean the fair value thereof as determined
by an independent investment banking or appraisal firm experienced in the
valuation of such securities or property selected in good faith by the Board of
Directors of the Company or a committee thereof, or, if no such investment
banking or appraisal firm is in the good faith judgment of the Board of
Directors or such committee available to make such determination, as determined
in good faith by the Board of Directors of the Company or such committee. The
"Fair Market Value" of the Series B Preferred Stock shall be the value
determined by an independent appraisal firm appointed by the Trustee, provided
that in determining such value, such appraisal firm shall not take into account
any accrued but unpaid Preferred Dividends.
"Non-Dilutive Amount" in respect of an issuance, sale or exchange by
the Company of any right or warrant to purchase or acquire shares of Common
Stock (including any security convertible into or exchangeable for shares of
Common Stock) shall mean the remainder of (i) the product of the Fair Market
value of a share of Common Stock on the day preceding the first announcement of
such issuance, sale or exchange multiplied by the maximum number of shares of
Common Stock which could be acquired on such date upon the exercise in full of
such rights and warrants (including upon the conversion or exchange of all such
convertible or exchangeable securities), whether or not exercisable (or
convertible or exchangeable) at such date, minus (ii) the aggregate amount
payable to the Company pursuant to such right or warrant to purchase or acquire
such maximum number of shares of Common Stock; provided, however, that in no
event shall the Non-Dilutive Amount be less than zero. For purposes of the
foregoing sentence, in the case of a security convertible into or exchangeable
for shares of Common Stock, the amount payable pursuant to a right or warrant to
purchase or acquire shares of Common Stock shall be the Fair Market Value of
such security on the date of the issuance, sale or exchange of such security by
the Company.
"Pro Rata Repurchase" shall mean any purchase of shares of Common Stock
by the Company or any subsidiary thereof, whether for cash, shares of capital
stock of the Company, other securities of the Company, evidences of indebtedness
of the Company or any other person or any other property (including shares of a
subsidiary of the Company), or any combination thereof, effected while any of
the shares of Series B Preferred Stock are outstanding, pursuant to any tender
offer or exchange offer subject to Section 13(e) of the Securities Exchange Act
of 1934, as amended (the "Exchange Act"), or any successor provision of law, or
pursuant to any other offer available to substantially all holders of Common
Stock; provided, however, that no purchase of shares by the Company or any
subsidiary thereof made in open market transactions shall be deemed a Pro Rata
Repurchase. For purposes of this paragraph 9(G), shares shall be deemed to have
been purchased by the Company or any subsidiary thereof "in open market
transactions" if they have been purchased substantially in accordance with the
requirements of Rule 10b-18 as in effect under the Exchange Act, on the date
shares of Series B Preferred Stock are initially issued by the Company or on
such other terms and conditions as the Board of Directors of the Company or a
committee thereof shall have determined are reasonably designed to prevent such
purchases from having a material effect on the trading market for the Common
Stock.
(H) Whenever an adjustment to the Conversion Price and the related
voting rights of the Series B Preferred Stock is required pursuant to this
Resolution, the Company shall forthwith place on file with the transfer agent
for the Common Stock and the Series B Preferred Stock if there be one, and with
the Secretary of the Company, a statement signed by two officers of the Company
stating the adjusted Conversion Price determined as provided herein and the
resulting conversion ratio, and the voting rights (as appropriately adjusted),
of the Series B Preferred Stock. Such statement shall set forth in reasonable
detail such facts as shall be necessary to show the reason and the manner of
computing such adjustment, including any determination of Fair Market Value
involved in such computation. Promptly after each adjustment to the Conversion
Price and the related voting rights of the Series B Preferred Stock, the Company
shall mail a notice thereof and of the then prevailing conversion ratio to each
holder of shares of the Series B Preferred Stock.
Section 10. Ranking; Attributable Capital and Adequacy of Surplus;
Retirement of Shares.
(A) The Series B Preferred Stock shall rank senior to (i) the Common
Stock as to the payment of dividends and the distribution of assets on
liquidation, dissolution or winding up of the Company, and (ii) the Series A
Junior Participating Preferred Stock as to the payment of dividends and the
distribution of assets upon liquidation, dissolution or winding-up. Unless
otherwise provided in the Restated Certificate of Incorporation of the Company,
as amended, or a Certificate of Designations relating to a subsequent series of
Preferred Stock, without par value, of the Company, the Series B Preferred Stock
shall rank junior to all other subsequent series of the Company's Preferred
Stock, without par value, as to the payment of dividends and the distribution of
assets on liquidation, dissolution or winding up.
(B) The capital of the Company allocable to the Series B Preferred
Stock for purposes of the Delaware General Corporation Law (the "Corporation
Law") shall be $1.00 per share. In addition to any vote of stockholders required
by law, the vote of the holders of a majority of the outstanding shares of
Series B Preferred Stock shall be required to increase the par value of the
Common Stock or otherwise increase the capital of the Company allocable to the
Common Stock for the purpose of the Corporation Law if, as a result thereof, the
surplus of the Company for purposes of the Corporation Law would be less than
the amount of Preferred Dividends that would accrue on the then outstanding
shares of Series B Preferred Stock during the following three years.
(C) Any shares of Series B Preferred Stock acquired by the Company by
reason of the conversion or redemption of such shares as provided by this
Resolution, or otherwise so acquired, shall be retired as shares of Series B
Preferred Stock and restored to the status of authorized but unissued shares of
preferred Stock, without par value, of the Company, undesignated as to series,
and may thereafter be reissued as part of a new series of such Preferred Stock
as permitted by law.
Section 11. Miscellaneous.
(A) All notices referred to herein shall be in writing, and all notices
hereunder shall be deemed to have been given upon the earlier of receipt thereof
or three (3) business days after the mailing thereof if sent by registered mail
(unless first-class mail shall be specifically permitted for such notice under
the terms of this Resolution) with postage prepaid, addressed: (i) if to the
Company, to its office at 1800 One Tandy Center, Fort Worth, Texas 76102,
(Attention: Herschel C. Winn, Senior Vice President and Secretary) or the
transfer Agent for the Series B Preferred Stock, or other agent of the Company
designated as permitted by this Resolution or (ii) if to any holder of the
Series B Preferred Stock or Common Stock, as the case may be, to such holder at
the address of such holder as listed in the stock record books of the Company
(which may include the records of any transfer agent for the Series B Preferred
Stock or Common Stock, as the case may be) or (iii) to such other address as the
Company or any such holder, as the case may be, shall have designated by notice
similarly given.
(B) The term "Common Stock" as used in this Resolution means the
Company's Common Stock of $1.00 par value, as the same exists at the date of
filing of a Certificate of Designations relating to Series B Preferred Stock, or
any other class of stock resulting from successive changes or reclassifications
of such Common Stock consisting solely of changes in par value. In the event
that, at any time as a result of an adjustment made pursuant to Section 9 of
this Resolution, the holder of any share of the Series B Preferred Stock upon
thereafter surrendering such shares for conversion shall become entitled to
receive any shares or other securities of the Company other than shares of
Common Stock, the Conversion Price in respect of such other shares or securities
so receivable upon conversion of shares of Series B Preferred Stock shall
thereafter be adjusted, and shall be subject to further adjustment from time to
time, in a manner and on terms as nearly equivalent as practicable to the
provisions with respect to Common Stock contained in Section 9 hereof, and the
provisions of Sections 1 through 8 and 10 and 11 of this Resolution with respect
to the Common Stock shall apply on like or similar terms to any such other
shares or securities.
(C) The Company shall pay any and all stock transfer and documentary
stamp taxes that may be payable in respect of any issuance or delivery of shares
of Series B Preferred Stock or shares of Common Stock or other securities issued
on account of Series B Preferred Stock pursuant hereto or certificates
representing such shares or securities. The Company shall not, however, be
required to pay any such tax which may be payable in respect of any transfer
involved in the issuance or delivery of shares of Series B Preferred Stock or
Common Stock or other securities in a name other than that in which the shares
of Series B Preferred Stock with respect to which such shares or other
securities are issued or delivered were registered, or in respect of any payment
to any person with respect to any such shares or securities other than a payment
to the registered holder thereof, and shall not be required to make any such
issuance, delivery or payment unless and until the person otherwise entitled to
such issuance, delivery or payment has paid to the Company the amount of any
such tax or has established, to the satisfaction of the Company, that such tax
has been paid or is not payable.
(D) In the event that a holder of shares of Series B Preferred Stock
shall not be written notice designate the name in which shares of Common Stock
to be issued upon conversion of such shares should be registered or to whom
payment upon redemption of shares of Series B Preferred Stock should be made or
the address to which the certificate or certificates representing such shares,
or such payment, should be sent, the Company shall be entitled to register such
shares, and make such payment, in the name of the holder of such Series B
Preferred Stock as shown on the records of the Company and to send the
certificate or certificates representing such shares, or such payment, to the
address of such holder shown on the records of the Company.
(E) Unless otherwise provided in the Restated Certificate of
Incorporation, as amended, of the Company, all payments in the form of
dividends, distributions on voluntary or involuntary dissolution, liquidation or
winding-up or otherwise made upon the shares of Series B Preferred Stock and any
other stock ranking on a parity with the Series B Preferred Stock with respect
to such dividend or distribution shall be made pro rata, so that amounts paid
per share on the Series B Preferred Stock and such other stock shall in all
cases bear to each other the same ratio that the required dividends,
distributions or payments, as the case may be, then payable per share on the
shares of the Series B Preferred Stock and such other stock bear to each other.
(F) The Company may appoint, and from time to time discharge and
change, a transfer agent for the Series B Preferred Stock. Upon any such
appointment or discharge of a transfer agent, the Company shall send notice
thereof by first-class mail, postage prepaid, to each holder of record of Series
B Preferred Stock.
IN WITNESS WHEREOF, the undersigned have executed and subscribed this
Certificate of Designations and have affixed the seal of the Company hereto and
do affirm the foregoing as true under the penalties of perjury this 29th day of
June, 1990.
/s/ John V. Roach
John V. Roach
Chairman and Chief
Executive Officer
ATTEST:
/s/ Herschel C. Winn
Herschel C. Winn
Secretary
TANDY CORPORATION BYLAWS
RESTATED AS OF
DECEMBER 16, 1998
ARTICLE I
OFFICES
SECTION 1. Registered Office. The Registered office of the Corporation in the
State of Delaware shall be located in the City of Wilmington, County of New
Castle, State of Delaware, and the name of the resident agent in charge thereof
shall be The Corporation Trust Company.
SECTION 2. Other Offices. The principal office shall be at 100 Throckmorton
Street, Suite 1800, Fort Worth, Texas. The Corporation may also have offices at
other places as the Board of Directors may from time to time appoint or the
business of the Corporation may require.
ARTICLE II
MEETINGS OF STOCKHOLDERS
SECTION 1. Place of Meeting. All meetings of the stockholders for the election
of directors shall be held at such place within or without the State of Delaware
as the Board of Directors may designate, provided that at least ten (10) days'
notice must be given to the stockholders entitled to vote thereat of the place
so fixed. Until the Board of Directors shall designate otherwise the annual
meeting of stockholders and the election of directors shall take place at the
office of the Corporation at 1800 One Tandy Center, Fort Worth, Texas. Meetings
of stockholders for any other purpose may be held at such place and time as
shall be stated in the notice of the meeting.
SECTION 2. Annual Meetings. The annual meeting of the stockholders for
the year 1993 shall be held on October 7, 1993, at 10:00 A.M., or on such other
date and at such other time as shall be designated by the Board of Directors and
stated in the notice of the meeting. The annual meeting of the stockholders
shall be held on the Third Thursday in May of each year beginning with the year
1994, if not a legal holiday, and if a legal holiday, then on the next business
day following, at 10:00 A.M., or on such other date and at such other time as
shall be designated from time to time by the Board of Directors and stated in
the notice of the meeting. At such annual meetings the stockholders shall elect
a Board of Directors by a plurality vote and shall transact such other business
as may properly be brought before the meeting.
SECTION 3. Special Meetings. Special meetings of the stockholders, for
any purpose or purposes, unless otherwise prescribed by statute or the
Certificate of Incorporation, may be called by the Chairman of the Board or the
President, and shall be called by the Secretary at the request in writing of a
majority of the Board of Directors. Such request shall state the purpose or
purposes of the proposed meeting.
SECTION 4. Notice. Written or printed notice of every meeting of
stockholders, annual or special, stating the time and place thereof, and, if a
special meeting, the purpose or purposes in general terms for which the meeting
is called, shall not be less than ten (10) days before such meeting be served
upon or mailed to each stockholder entitled to vote thereat, at his address as
it appears upon the books of the Corporation or, if such stockholder shall have
filed with the Secretary of the Corporation a written request that notices
intended for him be mailed to some other address, then to the address designated
in such request.
SECTION 5. Quorum. Except as otherwise provided by law or by the
Certificate of Incorporation, the presence in person or by proxy at any meeting
of stockholders of the holders of a majority of the shares of the capital stock
of the Corporation issued and outstanding and entitled to vote thereat shall be
requisite and shall constitute a quorum. If, however, such majority shall not be
represented at any meeting of the stockholders regularly called, the holders of
a majority of the shares present in person or by proxy and entitled to vote
thereat shall have power to adjourn the meeting to another time, or to another
time and place, without notice other than announcement of adjournment at the
meeting, and there may be successive adjournments for like cause and in like
manner until the requisite amount of shares entitled to vote at such meeting
shall be represented. At such adjourned meeting at which the requisite amount of
shares entitled to vote thereat shall be represented, any business may be
transacted which might have been transacted at the meeting as originally
notified.
SECTION 6. Votes. Proxies. At each meeting of stockholders every
stockholder shall have one vote for each share of capital stock entitled to vote
which is registered in his name on the books of the Corporation on the date on
which the transfer books were closed, if closed, or on the date set by the Board
of Directors for the determination of stockholders entitled to vote at such
meeting. At each such meeting every stockholder shall be entitled to vote in
person, or by proxy appointed by an instrument in writing subscribed by such
stockholder and bearing a date not more than three years prior to the meeting in
question, unless said instrument provides for a longer period during which it is
to remain in force.
At all meetings of the stockholders, a quorum being present, all
matters shall be decided by majority vote of the shares of stock entitled to
vote held by stockholders present in person or by proxy, except as otherwise
required by the Certificate of Incorporation or the laws of the State of
Delaware. Unless so directed by the chairman of the meeting, or required by the
laws of the State of Delaware, the vote thereat on any question need not be by
ballot.
On a vote by ballot, each ballot shall be signed by the stockholder
voting, or in his name by his proxy, if there be such proxy, and shall state the
number of shares voted by him and the number of votes to which each share is
entitled. On a vote by ballot, the chairman shall appoint two inspectors of
election, who shall first take and subscribe an oath or affirmation faithfully
to execute the duties of inspector at such meeting with strict impartiality and
according to the best of their ability and who shall take charge of the polls
and after the balloting shall make a certificate of the result of the vote
taken; but no director or candidate for the office of director shall be
appointed as such inspector.
SECTION 7. Stock List. At least ten (10) days before every election of
directors, a complete list of stockholders entitled to vote at such election,
arranged in alphabetical order, with the residence of each and the number of
voting shares held by each shall be prepared by the Secretary. Such list shall
be open at the place where the election is to be held for said ten (10) days, to
the examination of any stockholder entitled to vote at that election and shall
be produced and kept at the time and place of election during the whole time
thereof, and subject to the inspection of any stockholder who may be present.
SECTION 8. Notice of Stockholder Proposals.
(a) At an annual meeting of the stockholders, only such business shall
be conducted, and only such proposals shall be acted upon, as shall have been
brought before the annual meeting (i) by, or at the direction of, the Board of
Directors or (ii) by any stockholder of record of the Corporation who complies
with the notice procedures set forth in this Section 8 of these Bylaws. For a
proposal to be properly brought before an annual meeting by a stockholder, the
stockholder must have given timely notice thereof in writing to the Secretary of
the Corporation. To be timely, a stockholder's notice must be delivered to, or
mailed and received at, the principal executive offices of the Corporation not
less than sixty (60) days nor more than ninety (90) days prior to the scheduled
annual meeting, regardless of any postponements, deferrals or adjournments of
that meeting to a later date; provided, however, that if less than seventy (70)
days' notice or prior public disclosure of the date of the scheduled annual
meeting is given or made, notice by the stockholder to be timely must be so
delivered or received not later than the close of business on the tenth (10th)
day following the earlier of the day on which such notice of the date of the
scheduled annual meeting was mailed or the day on which such public disclosure
was made. A stockholder's notice to the Secretary shall set forth as to each
matter the stockholder proposes to bring before the annual meeting (i) a brief
description of the proposal desired to be brought before the annual meeting and
the reasons for conducting such business at the annual meeting, (ii) the name
and address, as they appear on the Corporation's books, of the stockholder
proposing such business and any other stockholders known by such stockholder to
be supporting such proposal, (iii) the class and number of shares of the
Corporation's stock which are beneficially owned by the stockholder on the date
of such stockholder notice and by any other stockholders known by such
stockholder to be supporting such proposal on the date of such stockholder
notice, and (iv) any financial interest of the stockholder in such proposal.
(b) If the presiding officer of the annual meeting determines that a
stockholder proposal was not made in accordance with the terms of this Section
8, he shall so declare at the annual meeting and any such proposal shall not be
acted upon at the annual meeting.
(c) This provision shall not prevent the consideration and approval or
disapproval at the annual meeting of reports of officers, directors and
committees of the Board of Directors, but, in connection with such reports, no
business shall be acted upon at such annual meeting unless stated, filed and
received as herein provided.
(d) Any stockholder seeking to bring a proposal before an annual
meeting of the Corporation shall continue to be subject, to the extent
applicable, to the requirements of Section 14(a) of the Securities Act of 1934,
as amended, and the regulations thereunder, as well as the requirements of this
Section 8.
ARTICLE III
DIRECTORS
SECTION 1. Number. The business and property of the Corporation shall
be conducted and managed by a Board of Directors consisting of not less than
three (3) or more than fourteen (14) members, none of whom need be a
stockholder.
The Board of Directors of the Corporation shall initially be composed
of three (3) directors, but the Board may at any time by resolution increase or
decrease the number of directors to not more than fourteen (14) or less than
three (3). The vacancies resulting from any such increase in the Board of
Directors, or an increase resulting from an amendment of this Section, shall be
filled as provided in Section 3 of this ARTICLE III.
SECTION 2. Term of Office. Except as otherwise provided by law such
director shall hold office until the next annual meeting of stockholders, and
until his successor is duly elected and qualified or until his earlier death or
resignation.
SECTION 3. Vacancies. If any vacancy shall occur among the directors,
or if the number of directors shall at any time be increased, the directors in
office, although less than a quorum, by a majority vote may fill the vacancies
or newly created directorships, or any such vacancies or newly created
directorships may be filled by the stockholders at any meeting. When one or more
directors shall resign from the Board of Directors, effective at a future date,
a majority of the directors then in office, including those who have so
resigned, shall have power to fill such vacancy or vacancies, the vote thereon
to take effect when such resignation or resignations shall become effective, and
each director so chosen shall hold office as herein provided in the filling of
other vacancies.
SECTION 4. Meetings. Meetings of the Board of Directors shall be held
at such place within or without the State of Delaware as may from time to time
be fixed by resolution of the Board of Directors or by the Chairman of the
Board, or the CEO as may be specified in the notice or waiver of notice of any
meeting. A regular meeting of the Board of Directors may be held without notice
immediately following the annual meeting of stockholders at the place where such
annual meeting is held. Regular meetings of the Board may also be held without
notice at such time and place as shall from time to time be determined by
resolution of the Board of Directors.
Special meetings of the Board of Directors may be called by the
Chairman of the Board, the CEO or the Secretary and shall be called by the
Secretary on the written request of two members of the Board of Directors.
Notice of any special meeting shall be given to each director at least (a)
twelve (12) hours before the meeting by telephone or by being personally
delivered or sent by telex, telecopy, telegraph, or similar means or (b) three
(3) days before the meeting if delivered by mail to the director's residence or
usual place of business. Such notice shall be deemed to be delivered when
deposited in the United States mail so addressed, with postage prepaid, or when
transmitted if sent by telex, telecopy, telegraph or similar means. Neither the
business to be transacted at, nor the purpose of, any special meeting of the
Board of Directors needs to be specified in the notice or waiver of notice of
such meeting.
Members of the Board of Directors may participate in a meeting of such
Board by means of conference telephone or similar communication equipment by
means of which all persons participating in the meeting can hear each other, and
participation in the meeting pursuant hereto shall constitute presence in person
at such meeting.
Any director may waive notice of any meeting by a writing signed by the
director entitled to the notice and filed with the minutes or corporate records.
The attendance at or participation of the director at a meeting shall constitute
waiver of notice of such meeting, unless the director at the beginning of the
meeting or promptly upon his arrival objects to holding the meeting or
transacting business at the meeting.
SECTION 5. Quorum. A majority, but not less than two (2), of the
directors shall constitute a quorum for the transaction of business. If at any
meeting of the Board of Directors there shall be less than a quorum present, a
majority of those present may adjourn the meeting from time to time without
notice other than announcement of the adjournment at the meeting, and at such
adjourned meeting at which a quorum is present any business may be transacted
which might have been transacted at the meeting as originally notified.
SECTION 6. Compensation. The directors may be paid their expenses, if
any, of attendance at each meeting of the Board of Directors, a fixed sum for
attendance at each meeting of the Board of Directors and/or a stated fee as
director. No such payment shall preclude any director from serving the
Corporation in any other capacity and receiving compensation therefor. Members
of the Executive Committee and/or of other committees may be allowed like
compensation and reimbursement of expenses for attending committee meetings.
SECTION 7. Chairman. From its members, the Board of Directors will
elect a chairman to preside over meetings of the shareholders and of the Board.
The Chairman may simultaneously serve as any Officer of the Corporation set
forth in Article V. The Board may elect one or more Vice Chairmen. In the
absence of the Chairman or a Vice Chairman, if any, the Board shall designate a
person to preside at such meetings. The director's fee of the Chairman and the
Vice Chairman, if any, will be set by the Board.
SECTION 8. Director Nominations. Nominations for the election of
directors may be made by the Board of Directors or a nominating committee
appointed by the Board of Directors or by any stockholder entitled to vote in
the election of directors generally. However, any stockholder entitled to vote
in the election of directors generally may nominate one or more persons for
election as directors at a meeting only if written notice of such stockholder's
intent to make such nomination or nominations has been given, either by personal
delivery or by United States mail, postage prepaid, to the Secretary of the
Corporation not later than (i) with respect to an election to be held at an
annual meeting of stockholders, ninety (90) days prior to the first anniversary
date of the immediately preceding annual meeting, and (ii) with respect to an
election to be held at a special meeting of stockholders for the election of
directors, the close of business on the tenth (10th) day following the date on
which notice of such meeting is first given to stockholders. Each such notice
shall set forth: (a) the name and address of the stockholder who intends to make
the nomination and of the person or persons to be nominated: (b) a
representation that the stockholder is a holder of record of stock of the
Corporation entitled to vote at such meeting and intends to appear in person or
by proxy at the meeting to nominate the person or persons specified in the
notice; (c) a description of all arrangements or understandings between the
stockholder and each nominee and any other person or persons (naming such person
or persons) pursuant to which the nomination or nominations are to be made by
the stockholder; (d) such other information regarding each nominee proposed by
such stockholder as would be required to be included in a proxy statement filed
pursuant to the proxy rules of the Securities and Exchange Commission as then in
effect; and (e) the consent of each nominee to serve as a director of the
Corporation if so elected. The presiding officer of the meeting may refuse to
acknowledge the nomination of any person not made in compliance with the
foregoing procedure.
ARTICLE IV
EXECUTIVE COMMITTEE AND OTHER COMMITTEES
SECTION 1. Executive Committee. The Board of Directors may, by
resolution passed by a majority of the whole Board, appoint an Executive
Committee of two (2) or more members, to serve during the pleasure of the Board
of Directors, to consist of such directors as the Board of Directors may from
time to time designate. The Chairman of the Executive Committee shall be
designated by the Board of Directors.
SECTION 2. Procedure. The Executive Committee, by a vote of a majority
of its members, shall fix its own times and places of meeting, shall determine
the number of its members constituting a quorum for the transaction of business,
and shall prescribe its own rules of procedure, no change in which shall be made
save by a majority vote of its members. Members of the Executive Committee or
any other committee may participate in a meeting of such Committee by means of
conference telephone or similar communication equipment by means of which all
persons participating in the meeting can hear each other, and participation in
the meeting pursuant hereto shall constitute presence in person at such meeting.
SECTION 3. Powers. During the intervals between the meetings of the
Board of Directors, the Executive Committee shall possess and may exercise all
the powers of the Board of Directors in the management and direction of the
business and affairs of the Corporation, to the extent permitted by law.
SECTION 4. Minutes. The Executive Committee shall keep regular minutes
of its proceedings and all action by the Executive Committee shall be reported
to the Board of Directors at its next meeting. Such action shall be subject to
review by the Board of Directors, provided that no rights of third parties shall
be affected by such review.
SECTION 5. Other Committees. From time to time the Board of Directors,
by the affirmative vote of a majority of the whole Board of Directors, may
appoint other committees for any purpose or purposes, and such committees shall
have such powers as shall be conferred by the resolution of appointment, and as
shall be permitted by law.
ARTICLE V
OFFICERS
SECTION 1. Officers. The Board of Directors shall elect, as officers, a
Chief Executive Officer ("CEO"), a President, a Treasurer and a Secretary, and
in their discretion one or more of the following officers: Executive Vice
Presidents, Senior Vice Presidents, Vice Presidents, Assistant Secretaries, and
Assistant Treasurers. Such officers shall be elected annually by the Board of
Directors at its first meeting following the annual meeting of stockholders, and
each shall hold office until the corresponding meeting of the Board of Directors
in the next year and until his successor shall have been duly elected and
qualified, or until he shall have died or resigned or shall have been removed in
the manner provided herein. The powers and duties of two or more offices may be
exercised and performed by the same person, except the offices of CEO and
Secretary.
SECTION 2. Vacancies. Any vacancy in any office may be filled for the
unexpired portion of the term by the Board of Directors at any regular or
special meeting.
SECTION 3. Chief Executive Officer The Chief Executive Officer shall be
the chief executive officer (CEO) of the Corporation. Subject to the direction
of the Board of Directors, he shall have and exercise direct charge of and
general supervision over the business and affairs of the Corporation and shall
perform such other duties as may be assigned to him from time to time by the
Board of Directors.
SECTION 4. President. The President shall perform such duties as the
Board of Directors may prescribe. In the absence or disability of the CEO, the
President shall perform and exercise the powers of the CEO. In addition, the
President shall perform such duties as from time to time may be delegated to him
by the CEO.
SECTION 5. Executive Vice Presidents. The Executive Vice Presidents
shall perform such duties as the Board of Directors may prescribe. In the
absence or disability of the CEO and President, the Executive Vice Presidents in
the order of their seniority or in such order as may be specified by the Board
of Directors, shall perform the duties of CEO. In addition, the Executive Vice
Presidents shall perform such duties as may from time to time be delegated to
them by the CEO.
SECTION 6. Senior Vice Presidents. The Senior Vice Presidents shall
perform such duties as the Board of Directors may prescribe. In the absence or
disability of the CEO, President, and the Executive Vice Presidents, the Senior
Vice Presidents in the order of their seniority or in such other order as may be
specified by the Board of Directors, shall perform the duties and exercise the
powers of the President. In addition, the Senior Vice Presidents shall perform
such duties as from time to time may be delegated to them by the CEO.
SECTION 7. Vice Presidents. The Vice Presidents shall perform such
duties as the Board of Directors may prescribe. In the absence or disability of
the CEO, President, the Executive Vice Presidents and the Senior Vice
Presidents, the Vice Presidents in the order of their seniority or in such other
order as may be specified by the Board of Directors, shall perform the duties
and exercise the powers of the President. In addition, the Vice Presidents shall
perform such duties as may from time to time be delegated to them by the CEO.
SECTION 8. Treasurer. The Treasurer shall have charge of and be
responsible for all funds, securities, receipts and disbursements of the
Corporation, and shall deposit, or cause to be deposited, in the name of the
Corporation, all moneys or other valuable effects in such banks, trust companies
or other depositaries as shall, from time to time, be selected by the Board of
Directors; he may endorse for collection on behalf of the Corporation, checks,
notes and other obligations; he may sign receipts and vouchers for payments made
to the Corporation; singly or jointly with another person as the Board of
Directors may authorize, he may sign checks of the Corporation and pay out and
dispose of the proceeds under the direction of the Board of Directors; he shall
cause to be kept correct books of account of all the business and transactions
of the Corporation, shall see that adequate audits thereof are currently and
regularly made, and shall examine and certify the accounts of the Corporation;
he shall render to the Board of Directors, the Executive Committee, the Chairman
of the Board, the Vice Chairman, the CEO or to the President, whenever
requested, an account of the financial condition of the Corporation; he may sign
with the Chairman of the Board, the Vice Chairman of the Board, the CEO, the
President or a Vice President, certificates of stock of the Corporation; and, in
general, shall perform all the duties incident to the office of a treasurer of a
Corporation, and such other duties as from time to time may be assigned to him
by the Board of Directors.
SECTION 9. Assistant Treasurers. The Assistant Treasurers in order of
their seniority shall, in the absence or disability of the Treasurer, perform
the duties and exercise the powers of the Treasurer and shall perform such other
duties as the CEO, or the Board of Directors shall prescribe.
SECTION 10. Secretary. The Secretary shall keep the minutes of all
meetings of the stockholders and of the Board of Directors in books provided for
the purpose; he shall see that all notices are duly given in accordance with the
provisions of law and these Bylaws; he shall be custodian of the records and of
the corporate seal or seals of the Corporation; he shall see that the corporate
seal is affixed to all documents, the execution of which, on behalf of the
Corporation, under its seal, is duly authorized and when the seal is so affixed
he may attest the same; he may sign, with the Chairman of the Board, the Vice
Chairman, the CEO, the President or a Vice President, certificates of stock of
the Corporation; and in general he shall perform all duties incident to the
office of a secretary of a corporation, and such other duties as from time to
time may be assigned to him by the Board of Directors or the CEO.
SECTION 11. Assistant Secretaries. The Assistant Secretaries in order
of their seniority shall, in the absence or disability of the Secretary, perform
the duties and exercise the powers of the Secretary and shall perform such other
duties as the CEO, or the Board of Directors shall prescribe.
SECTION 12. Subordinate Officers. The Board of Directors may appoint
such subordinate officers as it may deem desirable. Each such officer shall hold
office for such period, have such authority and perform such duties as the Board
of Directors may prescribe. The Board of Directors may, from time to time,
authorize any officer to appoint and remove subordinate officers and to
prescribe the powers and duties thereof.
SECTION 13. Compensation. The Board of Directors shall have power to
fix the compensation of all officers of the Corporation. It may authorize any
officer, upon whom the power of appointing subordinate officers may have been
conferred, to fix the compensation of such subordinate officers.
SECTION 14. Removal. Any officer of the Corporation may be removed,
with or without cause, by a majority vote of the Board of Directors at a meeting
called for that purpose.
SECTION 15. Bonds. The Board of Directors may require any officer of
the Corporation to give a bond to the Corporation, conditional upon the faithful
performance of his duties, with one or more sureties and in such amounts as may
be satisfactory to the Board of Directors.
ARTICLE VI
CERTIFICATES OF STOCK
SECTION 1. Form and Execution of Certificates. The interest of each
stockholder of the Corporation shall be evidenced by a certificate or
certificates for shares of stock in such form as may be prescribed from time to
time by law and by the Board of Directors. The certificates of stock of each
class and series now authorized or which may hereafter be authorized by the
Certificate of Incorporation shall be consecutively numbered and signed by
either the Chairman of the Board or the CEO or the President or a Vice President
together either with the Secretary or an Assistant Secretary or the Treasurer or
an Assistant Treasurer of the Corporation, and may be countersigned and
registered in such manner as the Board of Directors may prescribe, and shall
bear the corporate seal or a printed or engraved facsimile thereof. Where any
such certificate is signed by a transfer agent or transfer clerk and by a
registrar, the signatures of any such Chairman of the Board, CEO, President,
Vice President, Treasurer, Assistant Treasurer, Secretary or Assistant Secretary
upon such certificate may be facsimiles engraved or printed. In case any officer
or officers who shall have signed, or whose facsimile signature or signatures
shall have been placed upon, such certificate or certificates shall have ceased
to be such, whether because of death, resignation or otherwise, before such
certificate or certificates shall have been issued and delivered, such
certificate or certificates may nevertheless be issued and delivered with the
same effect as if such officer or officers had not ceased to be such at the date
of its issue and delivery.
SECTION 2. Transfer of Shares. The shares of the stock of the
Corporation shall be transferred on the books of the Corporation by the holder
thereof in person or by his attorney lawfully constituted, upon surrender for
cancellation of certificates for the same number of shares, with an assignment
and power of transfer endorsed thereon or attached thereto, duly executed, with
such proof or guaranty of the authenticity of the signature as the Corporation
or its agents may reasonably require. The Corporation shall be entitled to treat
the holder of record of any share or shares of stock as the holder in fact
thereof and accordingly shall not be bound to recognize any equitable or other
claim to or interest in such share or shares on the part of any other person
whether or not it shall have express or other notice thereof, except as
otherwise expressly provided by law.
SECTION 3. Closing of Transfer Books and Record Dates. The Board of
Directors may in its discretion prescribe in advance a period not exceeding
sixty (60) days prior to the date of any meeting of the stockholders or prior to
the last day on which the consent or dissent of stockholders may be effectively
expressed for any purpose without a meeting, during which no transfer of stock
on the books of the Corporation may be made; or in lieu of prohibiting the
transfer of stock, may fix in advance a time not more than sixty (60) days prior
to the date of any meeting of stockholders or prior to the last day on which the
consent or dissent of stockholders may be effectively expressed for any purpose
without a meeting, as the time as of which stockholders entitled to notice of
and to vote at such a meeting or whose consent or dissent is required or may be
expressed for any purpose, as the case may be, shall be determined; and all
persons who were holders of record of voting stock at such time and no others
shall be entitled to notice of and to vote at such meeting or to express their
consent or dissent, as the case may be, notwithstanding any transfer of any
stock on the books of the Corporation after any record date fixed as aforesaid.
The Board of Directors may also, in its discretion, fix in advance a date not
exceeding sixty (60) days preceding the date fixed for the payment of any
dividend or the making of any distribution, or for the delivery of evidence of
rights, or evidences of interests arising out of any issuance, change,
conversion or exchange of capital stock, as a record date for the determination
of the stockholders entitled to receive or participate in any such dividend,
distribution, rights or interests, notwithstanding any transfer of any stock on
the books of the Corporation after any record date fixed as aforesaid, or, at
its option, in lieu of so fixing a record date, may prescribe in advance a
period not exceeding sixty (60) days prior to the date for such payment,
distribution or delivery during which no transfer of stock on the books of the
Corporation may be made.
SECTION 4. Lost or Destroyed Certificates. In case of the loss or
destruction of any outstanding certificate of stock, a new certificate may be
issued upon the following conditions:
The owner of said certificate shall file with the Secretary of the
Corporation an affidavit giving the facts in relation to the ownership, and in
relation to the loss or destruction of said certificate, stating its number and
the number of shares represented thereby; such affidavit to be in such form and
contain such statements as shall satisfy the Chairman of the Board and Secretary
that said certificate has been accidentally destroyed or lost, and that a new
certificate ought to be issued in lieu thereof. Upon being so satisfied, the
Chairman of the Board and Secretary shall require such owner to file with the
Secretary a bond in such penal sum and in such form as they may deem advisable,
and with a surety or sureties approved by them, to indemnify and save harmless
the Corporation from any claim, loss, damage or liability which may be
occasioned by the issuance of a new certificate in lieu thereof, or if they deem
it appropriate, to waive the requirement to secure a bond with a surety. Upon
such bond being so filed, a new certificate for the same number of shares shall
be issued to the owner of the certificate so lost or destroyed; and the transfer
agent and registrar of stock, if any, shall countersign and register such new
certificate upon receipt of a written order signed by the said Chairman of the
Board and Secretary, and thereupon the Corporation will save harmless said
transfer agent and registrar in the premises. The CEO or the President or any
Vice President may act hereunder in the stead of the Chairman of the Board, and
an Assistant Secretary in the stead of the Secretary. In case of the surrender
of the original certificate, in lieu of which a new certificate has been issued,
or the surrender of such new certificate, for cancellation, the bond of
indemnity given as a condition of the issue of such new certificate may be
surrendered. A new certificate may be issued without requiring any bond when in
the judgment of the Board of Directors it is proper to do so.
ARTICLE VII
CHECKS, NOTES, ETC.
SECTION 1. Execution of Checks, Notes, etc. All checks and drafts on
the Corporation's bank accounts and all bills of exchange and promissory notes,
and all acceptances, obligations and other instruments for the payment of money,
shall be signed by such officer or officers, agent or agents, as shall be
thereunto authorized from time to time by the Board of Directors.
SECTION 2. Execution of Contracts, Assignments, etc. All contracts,
agreements, endorsements, assignments, transfers, stock powers, or other
instruments (except as provided in Sections 1 and 3 of this Article VII) shall
be signed by the CEO, the President, any Executive Vice President, Senior Vice
President, or Vice President and by the Secretary or any Assistant Secretary or
the Treasurer or any Assistant Treasurer, or by such other officer or officers,
agent or agents, as shall be thereunto authorized from time to time by the Board
of Directors.
SECTION 3. Execution of Proxies. The Chairman of the Board, the CEO,
President, or a Vice President of the Corporation may authorize from time to
time the signature and issuance of proxies to vote upon shares of stock of other
companies standing in the name of the Corporation. All such proxies shall be
signed in the name of the Corporation by the Chairman of the Board, the CEO,
President or a Vice President and by the Secretary or an Assistant Secretary.
ARTICLE VIII
WAIVERS AND CONSENTS
SECTION 1. Waivers. Whenever under the provisions of any law or under
the provisions of the Certificate of Incorporation of the Corporation or these
Bylaws, the Corporation, or the Board of Directors or any committee thereof, is
authorized to take any action after notice to stockholders or the directors or
the members of such committee, or after the lapse of a prescribed period of
time, such action may be taken without notice and without the lapse of any
period of time if, at any time before or after such action be completed, such
requirements be waived in writing by the person or persons entitled to said
notice or entitled to participate in the action to be taken, or, in the case of
a stockholder, by his attorney thereunto authorized.
SECTION 2. Consents. Any action required or permitted to be taken at
any meeting of the Board of Directors or of any committee of the Board of
Directors may be taken without a meeting, if prior to such action a written
consent thereto is signed by all members of the Board of Directors or of such
committee as the case may be, and such written consent is filed with the minutes
of proceedings of the Board of Directors or of such committee.
ARTICLE IX
DIVIDENDS AND RESERVE FUNDS
SECTION 1. Dividends. Except as otherwise provided by law or by the
Certificate of Incorporation, the Board of Directors may declare dividends out
of the surplus of the Corporation at such times and in such amounts as it may
from time to time designate.
SECTION 2. Reserve Funds. Before crediting net profits to the surplus
in any year, there may be set aside out of the net profits of the Corporation
for that year such sum or sums as the Board of Directors from time to time in
its absolute discretion may deem proper as a reserve fund or funds to meet
contingencies or for equalizing dividends or for repairing or maintaining any
property of the Corporation or for such other purpose as the Board of Directors
shall deem conducive to the interests of the Corporation.
ARTICLE X
INSPECTION OF BOOKS
The Board of Directors shall determine from time to time whether, and
if allowed when and under what conditions and regulations, the accounts and
books of the Corporation (except such as may by statute be specifically open to
inspection) or any of them shall be open to the inspection of the stockholders;
and the stockholders' rights in this respect are and shall be restricted and
limited accordingly.
ARTICLE XI
FISCAL YEAR
The fiscal year of the Corporation shall end on the thirty first day of
December each year commencing with December 31, 1992, unless another date shall
be fixed by resolution of the Board of Directors. After such date is fixed, it
may be changed for future fiscal years at any time or from time to time by
further resolution of the Board of Directors.
ARTICLE XII
SEAL
The corporate seal shall be circular in form and shall contain the name
of the Corporation, the state of incorporation, and the words "Corporate Seal".
ARTICLE XIII
AMENDMENTS
SECTION 1. By Stockholders. These Bylaws may be amended by a majority
vote of the stock entitled to vote and present or represented at any annual or
special meeting of the stockholders at which a quorum is present or represented,
if notice of the proposed amendment shall have been contained in the notice of
the meeting.
SECTION 2. By Directors. Except as otherwise specifically provided in
the Bylaws, if any, adopted by the stockholders, these Bylaws may be amended by
the affirmative vote of a majority of the Board of Directors, at any regular
meeting or special meeting thereof, if notice of the proposed amendment shall
have been contained in the notice of such meeting. If any Bylaw regulating an
impending election of directors is adopted or amended or repealed by the Board
of Directors, there shall be set forth in the notice of the next meeting of the
stockholders for the election of directors the Bylaws so adopted or amended or
repealed together with a concise statement of the changes made.
ARTICLE XIV
INDEMNIFICATION OF DIRECTORS, OFFICERS,
EMPLOYEES AND AGENTS
The Corporation shall indemnify and reimburse each person, and his
heirs, executors or administrators, who is made or is threatened to be made a
party to any action, suit or proceeding, whether civil, criminal, administrative
or investigative, by reason of the fact that he was or is a director, officer,
employee or agent of the Corporation or was or is serving at the request of the
Corporation as a director, officer, employee or agent of another Corporation,
partnership, joint venture, trust, or other enterprise, against expenses
(including attorney's fees), judgments, fines and amounts paid in settlement,
actually or reasonably incurred by him in connection with such action, suit or
proceeding and shall advance the expenses incurred by any officer or director in
defending any such action, suit or proceeding to the full extent permitted by
Section 145 of the General Corporation Law of the State of Delaware as it may be
amended or supplemented from time to time. Such right of indemnification or
advancement of expenses of any such person shall not be deemed exclusive of any
other rights to which he may be entitled under any statute, bylaw, agreement,
vote of stockholders or disinterested directors or otherwise, both as to action
in his official capacity and as to action in another capacity while holding such
office.
The foregoing provisions of this Article XIV shall be deemed to be a
contract between the Corporation and each person who serves in any capacity
specified therein at any time while this bylaw is in effect, and any repeal or
modification thereof shall not affect any rights or obligations then existing
with respect to any state of facts then or theretofore existing or any action,
suit or proceeding theretofore or thereafter brought based in whole or in part
upon any such state of facts.
Exhibit 4
TANDY CORPORATION
1999 INCENTIVE STOCK PLAN
(includes Directors)
1. Purpose.
The purpose of this Plan is to strengthen Tandy Corporation (the
"Company") by providing an incentive to a broad base of its Eligible Employees
(as hereinafter defined) and directors thereby encouraging them to devote their
abilities and industry to the success of the Company's business enterprise. It
is intended that this purpose be achieved by extending to these Eligible
Employees of the Company and its subsidiaries and to Eligible Directors an added
long-term incentive for high levels of performance and unusual efforts through
the grant of Nonqualified Stock Options and Stock Appreciation Rights (as each
term is hereinafter defined).
2. Definitions.
For purposes of the Plan:
2.1 "Adjusted Fair Market Value" means, in the event of a Change in
Control, the greater of (i) the highest price per Share paid to holders of the
Shares in any transaction (or series of transactions) constituting or resulting
in a Change in Control or (ii) the highest Fair Market Value of a Share during
the ninety (90) day period ending on the date of a Change in Control.
2.2 "Agreement" means the written agreement between the Company and an
Optionee or Grantee evidencing the grant of an Option or Stock Appreciation
Right and setting forth the terms and conditions thereof.
2.3 "Board" means the Board of Directors of the Company.
2.4 "Cause" means the commission of an act of fraud or intentional
misrepresentation or an act of embezzlement, misappropriation or conversion of
assets or opportunities of the Company or any Subsidiary.
2.5 "Change in Capitalization" means any increase or reduction in the
number of Shares, or any change (including, but not limited to, a change in
value) in the Shares or exchange of Shares for a different number or kind of
shares or other securities of the Company, by reason of a reclassification,
recapitalization, merger, consolidation, reorganization, spin-off, split-up,
issuance of warrants or rights or debentures, stock dividend, stock split or
reverse stock split, cash dividend, property dividend, combination or exchange
of shares, repurchase of shares, change in corporate structure or otherwise.
2.6 A "Change in Control" shall mean the occurrence during the term of
the Plan and during the term of any Option issued under the Plan of:
(a) An acquisition (other than directly from the Company) of
any voting securities of the Company (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 the Company'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 (i) an
employee benefit plan (or a trust forming a part thereof) maintained by (A) the
Company or (B) 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 the Company (for purposes of this definition, a "Subsidiary"),
(ii) the Company or its Subsidiaries, or (iii) any Person in connection with a
"Non-Control Transaction" (as hereinafter defined);
(b) The individuals who, as of February 24, 1999, 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 the Company'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 this Plan, 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
(c) Approval by stockholders of the Company of:
(i) A merger, consolidation or reorganization involving
the Company, unless
(A) the stockholders of the Company, 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,
(B) 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,
(C) no Person other than the Company, any Subsidiary,
any employee benefit plan (or any trust forming a
part thereof) maintained by the Company, the Surviving Corporation, or any
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
(D) a transaction described in clauses (A) through
(C) shall herein be referred to as a "Non-Control
Transaction";
(ii) A complete liquidation or dissolution of the Company;
or
(iii) An agreement for the sale or other disposition of
all or substantially all of the assets of the Company to any Person (other than
a transfer to a 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 the Company
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 the acquisition of Voting Securities by the Company, and after
such share acquisition by the Company, 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.
2.7 "Code" means the Internal Revenue Code of 1986, as amended.
2.8 "Committee" means a committee of the Board consisting of at least
two (2) members, all of whom are Disinterested Directors appointed by the Board
to administer the Plan and to perform the functions set forth herein.
2.9 "Company" means Tandy Corporation, a Delaware Corporation.
2.10 "Director Option" means an Option granted pursuant to Section 5.
2.11 "Disability" means the suffering from a physical or mental
condition which, in the opinion of the Committee based upon appropriate medical
advice and examination and in accordance with rules applied uniformly to all
employees of the Company, totally and permanently prevents the Grantee or
Optionee, as the case may be, from performing the customary duties of his or her
regular job with the Company.
2.12 "Disinterested Director" means a director of the Company who is
both a "Non-Employee Director" within the meaning of Rule 16b-3 under the
Exchange Act, and an "Outside Director" within the meaning of Section 162(m) of
the Code.
2.13 "Division" means any of the operating units, entities or divisions
of the Company or affiliated with the Company .
2.14 "Eligible Employee" means any officer, key employee, any full time
employee or a consultant or an advisor of the Company or a Subsidiary designated
by the Committee as eligible to receive Options or Stock Appreciation Rights
subject to the conditions set forth herein.
2.15 "Eligible Director" means a director of the Company who is
not an employee at the time of grant of the Company or any Subsidiary.
2.16 "Employee Option" means an Option granted pursuant to Section
6.
2.17 "Exchange Act" means the Securities Exchange Act of 1934, as
amended.
2.18 "Fair Market Value" on any date means the average of the high and
low sales prices of the Shares on such date on the principal national securities
exchange on which such Shares are listed or admitted to trading, or if such
Shares are not so listed or admitted to trading, the arithmetic mean of the per
Share closing bid price and per Share closing asked price on such date as quoted
on the National Association of Securities Dealers Automated Quotation System or
such other market in which such prices are regularly quoted, or, if there have
been no published bid or asked quotations with respect to Shares on such date,
the Fair Market Value shall be the value established by the Board in good faith.
2.19 "Grantee" means a person to whom a Stock Appreciation Right
has been granted under the Plan.
2.20 "93 ISP" means the Tandy Corporation 1993 Incentive Stock
Plan.
2.21 "97 ISP" means the Tandy Corporation 1997 Incentive Stock
Plan.
2.22 "Nonqualified Stock Option" means an Option which is not an
incentive stock option under Section 422 of the Code.
2.23 "Option" means an Employee Option, a Director Option, or either or
both of them.
2.24 "Optionee" means a person to whom an Option has been granted under
the Plan.
2.25 "Parent" means any corporation which is a parent corporation
(within the meaning of Section 424(e) of the Code) with respect to the Company.
2.26 "Plan or 99 ISP" means the Tandy Corporation 1999 Incentive
Stock Plan.
2.27 "Retirement" means a Director must have attained sixty (60) years
of age and served as a Director for sixty (60) consecutive months preceding his
or her resignation or retirement as a Director.
2.28 "Shares" means the common stock, par value $1.00 per share,
of the Company.
2.29. "Stock Appreciation Right" means a right to receive all or some
portion of the increase in the value of the Shares as provided in Section 8.
2.30 "Subsidiary" means any corporation a portion of whose voting
stock is owned directly or indirectly by the Company.
2.31 "Successor Corporation" means a corporation, or a parent or
subsidiary thereof within the meaning of Section 424(a) of the Code, which
issues or assumes a stock option in a transaction to which Section 424(a) of the
Code applies.
3. Administration.
3.1 The Plan shall be administered by the Committee which shall hold
meetings at such times as may be necessary for the proper administration of the
Plan. No member of the Committee shall be liable for any action, failure to act,
determination or interpretation made in good faith with respect to this Plan or
any transaction hereunder, except for liability arising from his or her own
willful misfeasance, gross negligence or reckless disregard of his or her
duties. The Company hereby agrees to indemnify each member of the Committee for
all costs and expenses and, to the extent permitted by applicable law, any
liability incurred in connection with defending against, responding to,
negotiation for the settlement of or otherwise dealing with any claim, cause of
action or dispute of any kind arising in connection with any actions in
administering this Plan or in authorizing or denying authorization to any
transaction hereunder.
3.2 Subject to the express terms and conditions set forth herein,
the Committee shall have the power from time to time to:
(a) determine those individuals to whom Employee Options shall
be granted under the Plan and the number of Nonqualified Stock Options to be
granted to each Eligible Employee and to prescribe the terms and conditions
(which need not be identical) of each Employee Option, including the purchase
price per Share subject to each Employee Option, and make any amendment or
modification to any Agreement consistent with the terms of the Plan;
(b) select those Eligible Employees to whom Stock Appreciation
Rights shall be granted under the Plan, the terms and conditions of each Stock
Appreciation Right, the maximum value of each Stock Appreciation Right and make
any amendment or modification to any Agreement consistent with the terms of the
Plan; and
3.3 Subject to the express terms and conditions set forth herein,
the Committee shall have the power from time to time:
(a) to construe and interpret the Plan and the Options and
Stock Appreciation Rights granted thereunder and to establish, amend and revoke
rules and regulations for the administration of the Plan, including, but not
limited to, correcting any defect or supplying any omission, or reconciling any
inconsistency in the Plan or in any Agreement, in the manner and to the extent
it shall deem necessary or advisable to make the Plan fully effective, and all
decisions and determinations by the Committee in the exercise of this power
shall be final, binding and conclusive upon the Company, its Subsidiaries, the
Optionees and Grantees and all other persons having any interest therein;
(b) to determine the duration and purposes for leaves of
absence which may be granted to an Optionee or Grantee on an individual basis
without constituting a termination of employment or service for purposes of the
Plan;
(c) to exercise its discretion with respect to the powers and
rights granted to it as set forth in the Plan; and
(d) generally, to exercise such powers and to perform such
acts as are deemed necessary or advisable to promote the best interests of the
Company with respect to the Plan.
3.4 During any calendar year no Eligible Employee may be granted
Options and Stock Appreciation Rights in the aggregate in respect of more than
1,000,000 Shares.
4. Stock Subject to the Plan.
4.1 The maximum number of Shares that may be made the subject of
Options and Stock Appreciation Rights granted under the Plan is 9,500,000. Upon
a Change in Capitalization the maximum number of Shares shall be adjusted in
number and kind pursuant to Section 10. The Company shall reserve for the
purposes of the Plan, out of its authorized but unissued Shares or out of Shares
held in the Company's treasury, or partly out of each, such number of Shares as
shall be determined by the Board.
4.2 Upon the granting of an Option or a Stock Appreciation Right, the
number of Shares available under Section 4.1 for the granting of further Options
and Stock Appreciation Rights shall be reduced in connection with the granting
of an Option or a Stock Appreciation Right by the number of Shares in respect of
which the Option or Stock Appreciation Right is granted or denominated.
4.3 Whenever any outstanding Option or Stock Appreciation Right or
portion thereof expires, is canceled or is otherwise terminated for any reason
without having been exercised or payment having been made in respect of the
entire Option or Stock Appreciation Right, the Shares allocable to the expired,
canceled or otherwise terminated portion of the Option or Stock Appreciation
Right may again be the subject of Options or Stock Appreciation Rights granted
hereunder.
5. Director Plans.
5A. Option Grants to Eligible Directors.
5A.1 Annual Grant. Subject to the provisions of Section 5C. hereof,
Director Options shall be granted to each Eligible Director on the first trading
day of September of each year the Plan is in effect and Director options under
the 93 ISP and 97 ISP are no longer available for grant to such Directors or any
one of them, as the case may be. Each Director Option granted shall be in
respect of 16,000 Shares or such lesser amount as the Board may from time to
time determine. The purchase price of each Director Option shall be as provided
in Section 5A.3 and such Options shall be evidenced by an Agreement containing
such other terms and conditions not inconsistent with the provisions of this
Plan as determined by the Board; provided, however, that such terms shall not
vary the timing of grants of Director Options, including provisions dealing with
forfeiture or termination of such Director Options, and further such terms may
not provide for a modification of a Director Option and the grant of new
Director Option in substitution for them which results in a Purchase Price (as
defined in Section 5A.3 hereof) that is lower than the Purchase Price of the
originally issued Director Option until authorized by the stockholders of the
Corporation.
5A.2 One Time Grant. Subject to the provisions of Section 5C. hereof,
each newly appointed or elected Eligible Director who has not previously
received a one-time grant under the 93 ISP and 97 ISP or hereunder, shall be
granted an option on the date the Eligible Director attends his or her first
Company Board meeting. Each Director Option granted under this Section shall be
in respect of 20,000 Shares or such lesser amount as the Board may from time to
time detemine. The purchase price of each Director Option shall be as provided
in Section 5A.3 and such Options shall be evidenced by an Agreement containing
such other terms and conditions not inconsistent with the provisions of this
Plan as determined by the Board; provided, however, that such terms shall not
vary the timing of grants of Director Options, including provisions dealing with
forfeiture or termination of such Director Options.
5A.3 Purchase Price. The purchase price for Shares under each Director
Option shall be equal to 100% of the Fair Market Value of such Shares on the
date the Director Option is granted.
5A.4 Vesting. Subject to Section 7.4, each Director Option shall become
exercisable with respect to one third (1/3) of the Shares subject thereto
effective as of each of the first, second and third annual anniversaries of the
grant date; provided, however, that the Optionee continues to serve as a
Director as of such dates. Notwithstanding the foregoing, if a Director's
service terminates by reason of his death, Disability or Retirement, all
Director Options then held by the Director shall be fully vested.
5A.5 Duration. Each Director Option shall terminate on the date which
is the tenth annual anniversary of the grant date, unless terminated earlier as
follows:
(a) If an Optionee's service as a Director terminates for any
reason other than Retirement, Disability, death or Cause, the Optionee may, for
a period of three (3) months after such termination, exercise his or her Option
to the extent, and only to the extent, that such Option or portion thereof was
vested and exercisable as of the date the Optionee's service as a Director
terminated, after which time the Option shall automatically terminate in full.
(b) If an Optionee's service as a Director terminates by
reason of the Optionee's Retirement or by resignation or removal from the Board
due to Disability, the Optionee may, for a period of three (3) years after such
termination, exercise his or her Option to the extent, and only to the extent
that such Option or portion thereof was vested and exercisable as of the date
the Optionee's service as a Director terminated, after which time the Option
shall automatically terminate in full.
(c) If an Optionee's service as a Director terminates for
Cause, the Option granted to the Optionee hereunder shall immediately terminate
in full and no rights thereunder may be exercised.
(d) If an Optionee dies while a Director or within three (3)
months after termination of service as a Director as described in clause (a) of
this Section 5A.5, or within three (3) years after termination of service as a
Director as described in clause (b) of this Section 5A.5, the Option granted to
the Optionee may be exercised at any time within 12 months after the Optionee's
death by the person or persons to whom such rights under the Option shall pass
by will, or by the laws of descent or distribution, after which time the Option
shall terminate in full.
5A.6 No Duplication. Notwithstanding any provision of the Plan to the
contrary, no Director Option shall be granted to any Eligible Director pursuant
to this Section 5A of the Plan on any day if such Director is granted an option
pursuant to Section 5A of the 93 ISP or 97 ISP on such day.
5B. Stock Purchase for Director Retainer Fees.
5B.1 Election to Participate.
(a) Initial Year Election. Each Eligible Director may
participate in this Section 5B by filing an election to participate with the
Company Secretary (the "Initial Year Election") at any time following his or her
appointment or election. An Initial Year Election shall become effective with
respect to the Eligible Director's retainer fees payable to him or her under the
Eligible Director compensation plan in respect of each calendar month commencing
with the first calendar month commencing after the receipt of the Initial Year
Election by the Company Secretary and ending the subsequent May 31. An Eligible
Director may, pursuant to an Initial Year Election, participate in this Section
5B only at either a 50% or 100% level and may not change his or her level of
participation except as provided in Section 5B.1 (b) below.
(b) Annual Election. Each Eligible Director may, prior to May
1 of any year, elect to participate (or cease to participate ) or change his or
her level of participation in this Section 5B (an "Annual Election"). An Annual
Election shall become effective with respect to the Eligible Director's retainer
fees payable to him or her under the Eligible Director compensation plan in
respect of the year commencing on June 1 next subsequent to the receipt of the
Annual Election by the Company Secretary and shall continue for subsequent years
unless changed pursuant to this Section 5B.1 (b). An Eligible Director may,
pursuant to an Annual Election, participate in this Section 5B only at either a
50% or 100% level and may not change his or her level of participation except as
provided in this Section 5B.1(b).
5B.2 Payment in Stock.
(a) For the period commencing on the effective date of an
Eligible Director's Initial Year Election through the next subsequent May 31,
(i) Shares will be issued to each Eligible Director participating at the 100%
level having a Fair Market Value (as of the first trading day immediately
preceding the date of issuance) equal to the Eligible Director's annual retainer
divided by twelve (12), then multiplied by the number of calendar months from
the effective date of the Initial Year Election through the next subsequent May
31; and (ii) Shares will be issued to each Eligible Director participating at
the 50% level according to the calculation in clause (i) of this Section 5B.2
(a) but reduced by one-half. Shares will be issued as of the effective date of
the Initial Year Election.
(b) For each year commencing on June 1 in respect of which an
Eligible Director has elected to participate in this Section 5B pursuant to an
Annual Election, (i) Shares will be issued to each Eligible Director
participating at the 100% level having a Fair Market Value (as of the first
trading day immediately preceding the date of issuance) equal to the Eligible
Director's annual retainer; and (ii) Shares will be issued to each Eligible
Director participating in this Section 5B at the 50% level according to the
calculation in clause (i) of this Section 5B.2(b) but reduced by one-half.
Shares will be issued as of June 1.
(c) The issuance of Shares to an Eligible Director
participating in this Section 5B shall represent payment in advance of, and
shall be in lieu of, 50% or 100%, as applicable, of the Eligible Director's
annual retainer for the period in respect of which the Initial Year Election or
the Annual Election is in effect.
5B.3 Distribution. Shares will be distributed to the Eligible Director
as soon as practicable after issuance. No fractional Share will be issued to any
Eligible Director. Any amount not used for the acquisition of a Share will be
paid to the Eligible Director in cash.
5B.4 No Duplication. Notwithstanding any provision in this Plan to the
contrary, no Shares shall be issued pursuant to this Section 5B of the Plan in
respect of an Eligible Director's retainer fees if Shares are or will be issued
pursuant to Section 5B of the 93 ISP or 97ISP in respect of such retainer fees.
6. Option Grants for Eligible Employees.
6.1 Authority of Committee. Subject to the provisions of the Plan and
to Section 4.1 above, the Committee shall have full and final authority to
select those Eligible Employees who will receive Options (each an "Employee
Option"), the terms and conditions of which shall be set forth in an Agreement.
6.2 Purchase Price. The purchase price or the manner in which the
purchase price is to be determined for Shares under each Employee Option shall
be determined by the Committee and set forth in the Agreement; provided,
however, that the purchase price per Share under each Nonqualified Stock Option
shall not be less than the Fair Market Value of a Share on the date the
Nonqualified Stock Option is granted.
6.3 Maximum Duration. Employee Options granted hereunder shall be for
such term as the Committee shall determine, provided that a Nonqualified Stock
Option shall not be exercisable after the expiration of ten (10) years from the
date it is granted. The Committee may, subsequent to the granting of any
Employee Option, extend the term thereof but in no event shall the term as so
extended exceed the maximum term provided for in the preceding sentence.
6.4 Vesting. Subject to Section 7.4 hereof, each Employee Option shall
become exercisable in such installments (which need not be equal) and at such
times as may be designated by the Committee and set forth in the Agreement. To
the extent not exercised, installments shall accumulate and be exercisable, in
whole or in part, at any time after becoming exercisable, but not later than the
date the Employee Option expires. The Committee may accelerate the
exercisability of any Option or portion thereof at any time.
6.5 Modification or Substitution. The Committee may, in its discretion,
modify outstanding Employee Options or accept the surrender of outstanding
Employee Options (to the extent not exercised) and grant new Options in
substitution for them. Notwithstanding the foregoing, (i) no modification of an
Employee Option shall adversely alter or impair any rights or obligations under
the Employee Option without the Optionee's consent, and (ii) no modification or
surrender of an outstanding option and the grant of new options in substitution
for them which results in a purchase price (as defined in Section 6.2 hereof)
that is lower than the purchase price of the originally issued Option shall be
effective until authorized by the stockholders of the Corporation.
7. Terms and Conditions Applicable to All Options.
7.1 Transferability. Unless otherwise provided by the Committee, no
Option granted hereunder shall be transferable by the Optionee to whom granted
otherwise than by will or the laws of descent and distribution, and an Option
may be exercised during the lifetime of such Optionee only by the Optionee or
his or her guardian or legal representative. The terms of such Option shall be
final, binding and conclusive upon the beneficiaries, executors, administrators,
heirs and successors of the Optionee.
7.2 Method of Exercise. The exercise of an Option shall be made only by
a written notice delivered in person to a designated facsimile number or by mail
to the Secretary of the Company at the Company's principal executive office, or
to such other person designated by the Secretary, specifying the number of
Shares to be purchased and accompanied by payment therefor and otherwise in
accordance with the Agreement pursuant to which the Option was granted. The
purchase price for any Shares purchased pursuant to the exercise of an Option
shall be paid in full upon such exercise by any one or a combination of the
following: (i) cash or (ii) transferring Shares to the Company upon such terms
and conditions as determined by the Committee. Notwithstanding the foregoing,
the Committee shall have discretion to determine at the time of grant of each
Employee Option or at any later date (up to and including the date of exercise)
the form of payment acceptable in respect of the exercise of such Employee
Option. The written notice pursuant to this Section 7.2 may also provide
instructions from the Optionee to the Company that upon receipt of the purchase
price in cash from the Optionee's broker or dealer, that has been approved by
the Company, designated as such on the written notice, in payment for any Shares
purchased pursuant to the exercise of an Option, the Company shall issue such
Shares directly to the designated broker or dealer that has been approved by the
Company. Any Shares transferred to the Company as payment of the purchase price
under an Option shall be valued at their Fair Market Value on the day preceding
the date of exercise of such Option. If requested by the Committee, the Optionee
shall deliver the Agreement evidencing the Option to the Secretary of the
Company, or to such other person designated by the Secretary, who shall endorse
thereon a notation of such exercise and return such Agreement to the Optionee.
No fractional Shares (or cash in lieu thereof) shall be issued upon exercise of
an Option and the number of Shares that may be purchased upon exercise shall be
rounded to the nearest number of whole Shares.
7.3 Rights of Optionees. No Optionee shall be deemed for any purpose to
be the owner of any Shares subject to any Option unless and until (i) the Option
shall have been exercised pursuant to the terms thereof, (ii) the Company shall
have issued and delivered the Shares to the Optionee or his designated broker or
dealer that has been approved by the Company and (iii) the Optionee's name or
the name of his designated broker or dealer that has been approved by the
Company shall have been entered as a stockholder of record on the books of the
Company. Thereupon, the Optionee shall have full voting, dividend and other
ownership rights with respect to such Shares.
7.4 Effect of Change in Control. Notwithstanding anything contained in
the Plan to the contrary, unless an Agreement evidencing an Option provides
otherwise, in the event of a Change in Control the Option shall become
immediately and fully exercisable. In addition, an Agreement evidencing an
Option may provide that the Optionee will be permitted to surrender for
cancellation within sixty (60) days after such Change in Control, the Option or
portion of the Option to the extent not yet exercised and the Optionee will be
entitled to receive a cash payment in an amount equal to the excess, if any, of
(A) the greater of (1) the Fair Market Value, on the date preceding the date of
surrender, of the Shares subject to the Option or portion thereof surrendered or
(2) the Adjusted Fair Market Value of the Shares subject to the Option or
portion thereof surrendered over (B) the aggregate purchase price for such
Shares under the Option or portion thereof surrendered. In the event an
Optionee's employment with, or service as a Director of, the Company terminates
following a Change in Control, each Option held by the Optionee that was
exercisable as of the date of termination of the Optionee's employment or
service shall remain exercisable for a period ending not before the earlier of
(A) the first annual anniversary of the termination of the Optionee's employment
or service or (B) the expiration of the stated term of the Option.
8. Stock Appreciation Rights. The Committee may, in its discretion,
either alone or in connection with the grant of an Option, grant to Eligible
Employees, Stock Appreciation Rights in accordance with the Plan and the terms
and conditions of which shall be set forth in an Agreement. If granted in
connection with an Option, a Stock Appreciation Right shall cover the same
Shares covered by the Option (or such lesser number of Shares as the Committee
may determine) and shall, except as provided in this Section 8, be subject to
the same terms and conditions as the related Option.
8.1 Time of Grant. A Stock Appreciation Right may be granted (i) at any
time if unrelated to an Option, or (ii) if related to an Option, either at the
time of grant, or at any time thereafter during the term of the Option.
8.2 Stock Appreciation Right Related to an Option.
(a) Exercise. A Stock Appreciation Right granted in connection
with an Option shall be exercisable at such time or times and only to the extent
that the related Option is exercisable, and will not be transferable except to
the extent the related Option may be transferable. A Stock Appreciation Right
granted in connection with a Nonqualified Stock Option shall be exercisable only
if the Fair Market Value of a Share on the date of exercise exceeds the purchase
price specified in the related Nonqualified Stock Option Agreement.
(b) Amount Payable. Upon the exercise of a Stock Appreciation
Right related to an Option, the Grantee shall be entitled to receive an amount
determined by multiplying (A) the excess of the Fair Market Value of a Share on
the date preceding the date of exercise of such Stock Appreciation Right over
the per Share purchase price under the related Option, by (B) the number of
Shares as to which such Stock Appreciation Right is being exercised.
Notwithstanding the foregoing, the Committee may limit in any manner the amount
payable with respect to any Stock Appreciation Right by including such a limit
in the Agreement evidencing the Stock Appreciation Right at the time it is
granted.
(c) Treatment of Related Options and Stock Appreciation Rights
Upon Exercise. Upon the exercise of a Stock Appreciation Right granted in
connection with an Option, the Option shall be canceled to the extent of the
number of Shares as to which the Stock Appreciation Right is exercised, and upon
the exercise of an Option granted in connection with a Stock Appreciation Right
or the surrender of such Option, the Stock Appreciation Right shall be canceled
to the extent of the number of Shares as to which the Option is exercised or
surrendered.
8.3 Stock Appreciation Right Unrelated to an Option. The Committee may
grant to Eligible Employees Stock Appreciation Rights unrelated to Options.
Stock Appreciation Rights unrelated to Options shall contain such terms and
conditions as to exercisability, vesting and duration as the Committee shall
determine, but in no event shall they have a term of greater than ten (10)
years. Upon exercise of a Stock Appreciation Right unrelated to an Option, the
Grantee shall be entitled to receive an amount determined by multiplying (A) the
excess of the Fair Market Value of a Share on the date preceding the date of
exercise of such Stock Appreciation Right over the Fair Market Value of a Share
on the date the Stock Appreciation Right was granted (the "Base Price") , by (B)
the number of Shares as to which the Stock Appreciation Right is being
exercised. Notwithstanding the foregoing, the Committee may limit in any manner
the amount payable with respect to any Stock Appreciation Right by including
such a limit in the Agreement evidencing the Stock Appreciation Right at the
time it is granted.
8.4 Method of Exercise. Stock Appreciation Rights shall be exercised by
a Grantee only by a written notice delivered in person to a designated facsimile
number or by mail to the Secretary of the Company, or to such other person
designated by the Secretary, at the Company's principal executive office,
specifying the number of Shares with respect to which the Stock Appreciation
Right is being exercised. If requested by the Committee, the Grantee shall
deliver the Agreement evidencing the Stock Appreciation Right being exercised
and the Agreement evidencing any related Option to the Corporate Secretary of
the Company, or to such other person designated by the Secretary, who shall
endorse thereon a notation of such exercise and return such Agreement to the
Grantee.
8.5 Form of Payment. Payment of the amount determined under Sections
8.2(b) or 8.3 may be made in the discretion of the Committee, solely in whole
Shares in a number determined at their Fair Market Value on the date preceding
the date of exercise of the Stock Appreciation Right, or solely in cash, or in a
combination of cash and Shares. If the Committee decides to make full payment in
Shares and the amount payable results in a fractional Share, payment for the
fractional Share will be made in cash.
8.6 Modification or Substitution. Subject to the terms of the Plan, the
Committee may modify outstanding grants of Stock Appreciation Rights or accept
the surrender of outstanding grants of Stock Appreciation Rights (to the extent
not exercised) and grant new Stock Appreciation Rights in substitution for them.
Notwithstanding the foregoing, (i) no modification of a Stock Appreciation Right
shall adversely alter or impair any rights or obligations under the Agreement
without the Grantee's consent, and (ii) no modification or surrender of an
outstanding Stock Appreciation Right and the grant of new Stock Appreciation
Rights in substitution for them, which results (in the case of Stock
Appreciation Right related to an Option) in a purchase price that is lower than
the purchase price specified in the related Nonqualified Stock Option Agreement,
and (in the case of Stock Appreciation Rights unrelated to Options) results in a
lower Base Price of a Share than that which existed on the date the Stock
Appreciation Right unrelated to Options was granted shall be effective until
authorized by the stockholders of the Corporation.
8.7 Effect of Change in Control. Notwithstanding anything contained in
this Plan to the contrary, unless an Agreement evidencing a Stock Appreciation
Right provides otherwise, in the event of a Change in Control, all Stock
Appreciation Rights shall become immediately and fully exercisable.
Notwithstanding Sections 8.3 and 8.5, an Agreement evidencing a Stock
Appreciation Right may provide that upon the exercise of a Stock Appreciation
Right unrelated to an Option or any portion thereof during the sixty (60) day
period following a Change in Control, the amount payable shall be in cash and
shall be an amount equal to the excess, if any, of (A) the greater of (i) the
Fair Market Value, on the date preceding the date of exercise, of the Shares
subject to Stock Appreciation Right or portion thereof exercised and (ii) the
Adjusted Fair Market Value, on the date preceding the date of exercise, of the
Shares over (B) the aggregate Fair Market Value, on the date the Stock
Appreciation Right was granted, of the Shares subject to the Stock Appreciation
Right or portion thereof exercised. In the event a Grantee's employment with the
Company terminates following a Change in Control, each Stock Appreciation Right
held by the Grantee that was exercisable as of the date of termination of the
Grantee's employment shall remain exercisable for a period ending not before the
earlier of the first annual anniversary of the termination of the Grantee's
employment or the expiration of the stated term of the Stock Appreciation Right.
9. Effect of a Termination of Employment. The Agreement evidencing the
grant of each Employee Option and each Stock Appreciation Right shall set forth
the terms and conditions applicable to such Employee Option or Stock
Appreciation Right upon a termination or change in the status of the employment
of the Optionee or Grantee by the Company, a Subsidiary or a Division (including
a termination or change by reason of the sale of a Subsidiary or a Division), as
the Committee may, in its discretion, determine at the time the Employee Option
or Stock Appreciation Rights is granted or thereafter.
10. Adjustment Upon Changes in Capitalization.
(a) In the event of a Change in Capitalization, the Committee
shall conclusively determine the appropriate adjustments, if any, to the (i)
maximum number and class of Shares or other stock or securities with respect to
which Options or Stock Appreciation Rights may be granted under the Plan, (ii)
the number and class of Shares or other stock or securities which are subject to
Director Options issuable under Section 5; and (iii) the number and class of
Shares or other stock or securities which are subject to outstanding Options or
Stock Appreciation Rights granted under the Plan, and the purchase price
therefor, if applicable; and (iv) the maximum number and class of Shares or
other stock or securities with respect to which Options or Stock Appreciation
Rights may be granted to any Eligible Employee.
(b) Any stock adjustment in the Shares or other stock or
securities subject to outstanding Director Options (including any adjustments in
the purchase price) shall be made only to the extent necessary to maintain the
proportionate interest of the Optionee and preserve, without exceeding, the
value of such Director Option.
(c) If, by reason of a Change in Capitalization, a Grantee of
a Stock Appreciation Right shall be entitled to, or an Optionee shall be
entitled to exercise an Option with respect to, new, additional or different
shares of stock or securities, such new, additional or different shares shall
thereupon be subject to all of the conditions, restrictions and performance
criteria which were applicable to the Shares subject to the Stock Appreciation
Right or Option, as the case may be, prior to such Change in Capitalization.
11. Effect of Certain Transactions. Subject to Sections 7.4 and 8.7 in
the event of (i) the liquidation or dissolution of the Company or (ii) a merger
or consolidation of the Company (a "Transaction"), the Plan and the Options and
Stock Appreciation Rights issued hereunder shall continue in effect in
accordance with their respective terms and each Optionee and Grantee shall be
entitled to receive in respect of each Share subject to any outstanding Options
or Stock Appreciation Rights, as the case may be, upon exercise of any Option or
payment or transfer in respect of any Stock Appreciation Right, the same number
and kind of stock, securities, cash, property, or other consideration that each
holder of a Share was entitled to receive in the Transaction in respect of a
Share.
12. Termination and Amendment of the Plan. The Plan shall terminate on
the day preceding the tenth annual anniversary of the date of its adoption by
the Board and no Option or Stock Appreciation Right may be granted thereafter.
The Board may sooner terminate the Plan and the Board may at any time and from
time to time amend, modify or suspend the Plan; provided, however, that:
(a) No such amendment, modification, suspension or termination
shall impair or adversely alter any Options or Stock Appreciation Rights
therefor granted under the Plan, except with the consent of the Optionee or
Grantee, nor shall any amendment, modification, suspension or termination
deprive any Optionee or Grantee of any Shares which he or she may have acquired
through or as a result of the Plan.
13. Non-Exclusivity of the Plan. The adoption of the Plan by the Board
shall not be construed as amending, modifying or rescinding any previously
approved incentive arrangements or as creating any limitations on the power of
the Board to adopt such other incentive arrangements as it may deem desirable,
including, without limitation, the granting of stock options otherwise than
under the Plan, and such arrangements may be either applicable generally or only
in specific cases.
14. Limitation of Liability. As illustrative of the limitations of
liability of the Company, but not intended to be exhaustive thereof, nothing in
the Plan shall be construed to:
(i) give any person any right to be granted an Option or Stock
Appreciation Right other than at the sole discretion of the Committee;
(ii) give any person any rights whatsoever with respect to
Shares except as specifically provided in the Plan;
(iii) limit in any way the right of the Company or any
Subsidiary or any Division to terminate the employment of any person at any
time; or
(iv) be evidence of any agreement or understanding, expressed
or implied, that the Company will employ any person at any particular rate of
compensation or for any particular period of time.
15. Regulations and Other Approvals; Governing Law.
15.1 Except as to matters of federal law, this Plan and the rights of
all persons claiming hereunder shall be construed and determined in accordance
with the laws of the State of Texas without giving effect to conflict of laws
principles.
15.2 The obligation of the Company to sell or deliver Shares with
respect to Options and Stock Appreciation Rights granted under the Plan shall be
subject to all applicable laws, rules and regulations, including all applicable
federal and state securities laws, and the obtaining of all such approvals by
governmental agencies as may be deemed necessary or appropriate by the
Committee.
15.3 The Plan is intended to comply with Rule 16b-3 promulgated under
the Exchange Act and the Committee shall interpret and administer the provisions
of the Plan or any Agreement in a manner consistent therewith. Any provisions
inconsistent with such Rule shall be inoperative and shall not affect the
validity of the Plan.
15.4 The Board may make such changes as may be necessary or appropriate
to comply with the rules and regulations of any government authority.
15.5 Each Option and Stock Appreciation Right is subject to the
requirement that, if at any time the Committee determines, in its discretion,
that the listing, registration or qualification of Shares issuable pursuant to
the Plan is required by any securities exchange or under any state or federal
law, or the consent or approval of any governmental regulatory body is necessary
or desirable as a condition of, or in connection with, the grant of an Option or
Stock Appreciation Right or the issuance of Shares, no Options or Stock
Appreciation Rights shall be granted or payment made or Shares issued, in whole
or in part, unless such listing, registration, qualification, consent or
approval has been effected or obtained free of any conditions as acceptable to
the Committee.
15.6 Notwithstanding anything contained in the Plan or any Agreement to
the contrary, in the event that the disposition of Shares acquired pursuant to
the Plan is not covered by a then current registration statement under the
Securities Act of 1933, as amended, and is not otherwise exempt from such
registration, such Shares shall be restricted against transfer to the extent
required by the Securities Act of 1933, as amended, and Rule 144 or other
regulations thereunder. The Committee may require any individual receiving
Shares pursuant to an Option or Stock Appreciation Right granted under the Plan,
as a condition precedent to receipt of such Shares, to represent and warrant to
the Company in writing that the Shares acquired by such individual are acquired
without a view to any distribution thereof and will not be sold or transferred
other than pursuant to an effective registration thereof under said Act or
pursuant to an exemption applicable under the Securities Act of 1933, as
amended, or the rules and regulations promulgated thereunder. The certificates
evidencing any of such Shares shall be appropriately legended to reflect their
status as restricted securities as aforesaid.
16. Pooling Transactions. Notwithstanding anything contained in the
Plan or any Agreement to the contrary, in the event of a Change in Control which
is also intended to constitute a pooling transaction under the Code, the
Committee shall take such actions, if any, as are specifically recommended by an
independent accounting firm retained by the Company to the extent reasonably
necessary in order to assure that the pooling transaction will qualify as such,
including but not limited to (i) deferring the vesting, exercise, payment,
settlement or lapsing of restrictions with respect to any Option or Stock
Appreciation Right, (ii) providing that the payment or settlement in respect of
any Option or Stock Appreciation Right be made in the form of cash, Shares or
securities of a successor or acquirer of the Company, or a combination of the
foregoing, and (iii) providing for the extension of the term of any Option or
Stock Appreciation Right to the extent necessary to accommodate the foregoing,
but not beyond the maximum term permitted for any Option or Stock Appreciation
Right.
17. Miscellaneous.
17.1 Multiple Agreements. The terms of each Option or Stock
Appreciation Right may differ from other Options or Stock Appreciation Rights
granted under the Plan at the same time, or at some other time. The Committee
may also grant more than one Option or Stock Appreciation Right to a given
Eligible Employee during the term of the Plan, either in addition to, or in
substitution for, one or more Options or Stock Appreciation Rights previously
granted to that Eligible Employee.
17.2 Withholding of Taxes. (a) The Company shall have the right to
deduct from any distribution of cash to any Director, Optionee or Grantee, an
amount equal to the federal, state and local income taxes and other amounts as
may be required by law to be withheld (the "Withholding Taxes") with respect to
the receipt of any retainer fee, Option or Stock Appreciation Right. If a
Director, Optionee or Grantee is to experience a taxable event in connection
with the receipt of Shares pursuant to a payment in stock, Option exercise or
payment of a Stock Appreciation Right (a "Taxable Event"), the Director,
Optionee or Grantee shall pay the Withholding Taxes to the Company prior to the
issuance, or release from escrow, of such Shares. In satisfaction of the
obligation to pay Withholding Taxes to the Company, the Director, Optionee or
Grantee may make a written election (the "Tax Election"), which may be accepted
or rejected in the discretion of the Committee or Company Secretary or his or
her designee, as applicable, to have withheld a portion of the Shares then
issuable to him or her having an aggregate Fair Market Value, on the date
preceding the date of such issuance, equal to the Withholding Taxes. The
Committee may, by the adoption of rules or otherwise, (i) modify the provisions
of this Section 17.2 (other than as regards Director Options) or impose such
other restrictions or limitations on Tax Elections as may be necessary to ensure
that the Tax Elections will be exempt transactions under Section 16(b) of the
Exchange Act, and (ii) permit Tax Elections to be made at such other times and
subject to such other conditions as the Committee determines will constitute
exempt transactions under Section 16(b) of the Exchange Act.
(b) The Committee shall have the authority, at the time of
grant of an Employee Option or Stock Appreciation Right under the Plan or at any
time thereafter, to award tax bonuses to designated Optionees or Grantees, to be
paid upon their exercise of Employee Options or payment in respect of Stock
Appreciation Rights granted hereunder. The amount of any such payments shall be
determined by the Committee. The Committee shall have full authority in its
absolute discretion to determine the amount of any such tax bonus and the terms
and conditions affecting the vesting and payment thereof.
18. Effective Date. The effective date of the Plan shall be
February 24, 1999 the date of its adoption by the Board.
Exhibit 5
TANDY CORPORATION
Executive Offices 100 Throckmorton St., Ste. 1700, Fort Worth, Texas 76102
Telephone (817) 390-3700
June 23, 1999
Tandy Corporation
100 Throckmorton St., Suite 1800
Fort Worth, TX 76102
Ladies and Gentlemen:
I am the Senior Vice President, Corporate Secretary and General Counsel of Tandy
Corporation (the "Company") and have assisted with the filing with the
Securities and Exchange Commission (the "Commission"), under the Securities Act
of 1933, as amended, (the "Act") of a Registration Statement on Form S-8 (the
"Registration Statement") for the purpose of registering 9,500,000 shares of
common stock, $1.00 par value, of the Company (the "Shares") all in accordance
with the terms of the Tandy Corporation 1999 Incentive Stock Plan (the "Plan").
In such capacity, I have examined the Company's Restated Certificate of
Incorporation, as amended, the Restated By-Laws of the Company, the Plan, and
such other documents of the Company as I have deemed necessary or appropriate
for the purposes of the opinion expressed herein.
Based upon the foregoing, in my opinion the Shares, when issued by the Company
and fully paid for in accordance with the provisions of the Plan and any
agreement applicable to such Shares (with the consideration received by the
Company, being not less than the par value thereof), will be validly issued,
fully paid and non-assessable.
I consent to the filing of this opinion as an exhibit to the Registration
Statement and to the use of my name wherever appearing in the Registration
Statement and any amendment thereto.
Very truly yours,
Mark C. Hill
Senior Vice President, Corporate
Secretary and General Counsel
Exhibit 23
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, 1999, relating to the
financial statements, which appears in the 1998 Annual Report to Shareholders of
Tandy Corporation, which is incorporated by reference in Tandy Corporation's
Annual Report on Form 10-K for the year ended December 31, 1998.
PricewaterhouseCoopers LLP
Fort Worth, Texas
June 23, 1999
