Exhibit 10b
Form of Executive Pay Plan Letters
Form 1 is used in the case of seven executive officers.
Form 2 is used in the case of one executive officer.
Form 3 is used in the case of one executive officer.
Form 4 is used in the case of one executive officer.
In no case will the maximum bonus amount exceed the amount
of the individuals base salary.
(Date) Form 1
TO: (Name)
FROM: Richard L. Ramsey
SUBJECT: Compensation Plan, Fiscal Year 1994
Your compensation plan for fiscal year 1994, as approved by
the Organization and Compensation Committee of the Board of
Directors, is outlined below.
I. FY 1994 Base Salary
Your Base Salary for FY94 shall be $_________
II. Your bonus for FY94 shall be determined by multiplying
the percent determined in the following TARGET
INCENTIVE GOALS times the FACTORS set forth below.
The bonus amounts payable are subject to limitations
set forth in Paragraph III and IV.
TARGET INCENTIVE GOALS:
1. INCOME
Each percentage point of positive change that the Tandy
Corporation and subsidiaries income from operations
(before income taxes) increases from the prior year.
2. EARNINGS PER SHARE
Each percentage point of positive change that the Tandy
Corporation earnings per share increases from the prior
year.
3. STOCK PRICE
a. Each percentage point of positive change that the
Tandy Corporation stock price increases, based on the
average daily closing price for December 1993 ($47.3)
and December 1994.
b. If the stock performance exceeds the "Peer Group"
average and the 5% minimum increase, a bonus will be
paid equal to the stock price increase amount. In
addition, if Tandy's stock percent increase is in or
above the 75th percentile of the "Peer Group", an
additional bonus will be paid equal to the stock price
increase amount.
Percentages shall be calculated to two decimal
points.
Your factors to be used for each of the
calculations above are as follows:
1. Income increase: $_________
2. Earnings per share increase: $___________
3. Stock price increase: $_____________
III. Minimum Bonus
Minimum Threshold Increase Percent for Each Target
Incentive Goal
Minimum Increase %
1. Income ___
2. Earnings per share ___
3. Stock price ___
Bonus amounts earned from each of the factors which
exceed the minimum increase above will be accumulated.
No bonus will be paid unless the accumulated bonus
exceeds __% of your base salary.
Bonus will only be paid on each goal which exceeds the
Minimum Increase % set forth above.
IV. Maximum Bonus
The bonus paid will be limited to an amount not to
exceed $_______
V. This compensation plan is not an employment contract,
but a method of calculating your total earnings. You
forfeit your rights to receive a bonus if you resign
before the end of the current fiscal year. If you are
terminated by the Company, you forfeit your rights to
receive a bonus except at the sole discretion of the
Company and in such amount as the Company might decide.
If you retire at age 55 or over, provided the Company
has given its consent to your early retirement, or die
before the end of the then current fiscal year, your
bonus for the current year-to-date will be calculated
to the nearest end of the month preceding or succeeding
such event, using the formula above and adjusting for
the partial year. The amount will be paid to you or to
the legal representative of your estate.
VI. If at any time during your continued employment, your
responsibility, duties or title changes, this plan is
subject to revision or termination by the Company at
the time of the foregoing change.
(Date) Form 2
TO: (Name)
FROM: Richard L. Ramsey
SUBJECT: Compensation Plan, Fiscal Year 1994
Your compensation plan for fiscal year 1994 is outlinedbelow.
I. FY 1994 Base Salary
Your Base Salary for FY94 shall be $_________
II. Your bonus for FY94 shall be determined by multiplying
the percent determined in the following TARGET
INCENTIVE GOALS times the FACTORS set forth below.
The bonus amounts payable are subject to limitations
set forth in Paragraph III and IV.
TARGET INCENTIVE GOALS:
1. INCOME
Each percentage point of positive change that the Tandy
Corporation and subsidiaries income from operations
(before income taxes) increases from the prior year.
2. Each percentage point of positive change that the
Tandy Service's net income (Pre Tandy Admin)
increases from the prior year. Tandy Services,
for this calculation, will include TE-US, TE
Asia, Tandy Services Consolidation (P&L
RS3-8200), and Tandy Transportation.
Your factors to be used for each of the calculations
above are as follows:
1. Tandy Corporation income increase: $_______
2. Tandy Services income increase: $_______
III. Minimum Bonus
Minimum Threshold Increase Percent for Each Target
Incentive Goal
Minimum Increase %
1. Tandy Corporation income
increase: _______
2. Tandy Services income increase: _______
Bonus amounts earned from each of the factors which
exceed the minimum increase above will be accumulated.
No bonus will be paid unless the accumulated bonus
exceeds __% of your base salary.
Bonus will only be paid on each goal which exceeds the
Minimum Increase % set forth above.
IV. Maximum Bonus
The bonus paid will be limited to an amount not to
exceed $_______
V. This compensation plan is not an employment contract,
but a method of calculating your total earnings. You
forfeit your rights to receive a bonus if you resign
before the end of the current fiscal year. If you are
terminated by the Company, you forfeit your rights to
receive a bonus except at the sole discretion of the
Company and in such amount as the Company might decide.
If you retire at age 55 or over, provided the Company
has given its consent to your early retirement, or die
before the end of the then current fiscal year, your
bonus for the current year-to-date will be calculated
to the nearest end of the month preceding or succeeding
such event, using the formula above and adjusting for
the partial year. The amount will be paid to you or to
the legal representative of your estate.
VI. If at any time during your continued employment, your
responsibility, duties or title changes, this plan is
subject to revision or termination by the Company at
the time of the foregoing change.
(Date) Form 3
TO: (Name)
FROM: Richard L. Ramsey
SUBJECT: Compensation Plan, Fiscal Year 1994
Your compensation plan for fiscal year 1994 is outlined below.
I. FY 1994 Base Salary
Your Base Salary for FY94 shall be $_________
II. Your bonus for FY94 shall be determined by multiplying
the percent determined in the following TARGET
INCENTIVE GOALS times the FACTORS set forth below.
The bonus amounts payable are subject to limitations
set forth in Paragraph III and IV.
TARGET INCENTIVE GOALS:
1. INCOME
Each percentage point of positive change that the Radio
Shack division net income (before income taxes)
increases from the prior year.
2. SALES
Each percentage point of positive change that the Radio
Shack division sales increase from the prior year.
3. GROSS PROFIT
Each percentage point of positive change that the Radio
Shack division gross profit dollars increase from the
prior year.
Radio Shack results will be adjusted to reflect
certain Tandy support operations for 1993 and 1994 and
for estimated costs of Tandy Credit promotions for
1993.
Percentages shall be calculated to two decimal points.
Your factors to be used for each of the
calculations above are as follows:
1. Radio Shack income increase: $_______
2. Radio Shack sales increase: $_______
3. Radio Shack gross profit dollars increase: $_______
III. Minimum Bonus
Minimum Threshold Increase Percent for Each Target
Incentive Goal
Minimum Increase %
1. Income _______
2. Sales _______
3. Gross Profit _______
Bonus amounts earned from each of the factors which
exceed the minimum increase above will be accumulated.
No bonus will be paid unless the accumulated bonus
exceeds __% of your base salary.
Bonus will only be paid on each goal which exceeds the
Minimum Increase % set forth above.
IV. Maximum Bonus
The bonus paid will be limited to an amount not to
exceed $_______
V. This compensation plan is not an employment contract,
but a method of calculating your total earnings. You
forfeit your rights to receive a bonus if you resign
before the end of the current fiscal year. If you are
terminated by the Company, you forfeit your rights to
receive a bonus except at the sole discretion of the
Company and in such amount as the Company might decide.
If you retire at age 55 or over, provided the Company
has given its consent to your early retirement, or die
before the end of the then current fiscal year, your
bonus for the current year-to-date will be calculated
to the nearest end of the month preceding or succeeding
such event, using the formula above and adjusting for
the partial year. The amount will be paid to you or to
the legal representative of your estate.
VI. If at any time during your continued employment, your
responsibility, duties or title changes, this plan is
subject to revision or termination by the Company at
the time of the foregoing change.
(Date) Form 4
TO: (Name)
FROM: Richard L. Ramsey
SUBJECT: Compensation Plan, Fiscal Year 1994
Your compensation plan for fiscal year 1994 is outlined
below.
I. FY 1994 Base Salary
Your Base Salary for FY94 shall be $_________
II. Your bonus for FY94 shall be determined in the
following TARGET INCENTIVE GOALS set forth below.
The bonus amounts payable are subject to limitations
set forth in Paragraph III and IV.
TARGET INCENTIVE GOALS:
Tandy Corporation
Each percentage point of positive change that the Tandy
Corporation and subsidiaries Income from operations
(before income taxes) increases from the prior year,
times a factor of $1,315.
Tandy Credit
A. Each percentage point of positive change that the
Tandy Corporation accounts receivable purchased
increases from the prior year level of $605
million, times a factor of $450.
B. You will receive a $5,220 bonus for each
percentage point reduction of gross charge-off
dollars (includes regular, bankrupt and fraud,
excludes reinstatements) from a $70.2M level.
EXAMPLE:
LOSS BASE 70,200
ACTUAL LOSS 68,300
______
DIFF 1,900
% Reduction 2.7% X $5,220 = $14,094 Bonus
III. Minimum Bonus
Minimum Threshold Increase Percent for Each Target
Incentive Goal
Minimum Increase %
1. Tandy Corporation Income _______
2. Tandy Credit Receivables, Purchases _______
3. Tandy Credit Gross Charge-Off Dollars _______ (Decrease%)
Bonus amounts earned from each of the factors which
exceed the minimum increase above will be accumulated.
No bonus will be paid unless the accumulated bonus
exceeds __% of your base salary.
Bonus will only be paid on each goal which exceeds the
Minimum Increase % set forth above.
IV. Maximum Bonus
The bonus paid will be limited to an amount not to
exceed $_______
V. This compensation plan is not an employment contract,
but a method of calculating your total earnings. You
forfeit your rights to receive a bonus if you resign
before the end of the current fiscal year. If you
are terminated by the Company, you forfeit your rights
to receive a bonus except at the sole discretion of the
Company and in such amount as the Company might decide.
If you retire at age 55 or over, provided the Company
has given its consent to your early retirement, or die
before the end of the then current fiscal year, your
bonus for the current year-to-date will be calculated
to the nearest end of the month preceding or succeeding
such event, using the formula above and adjusting for
the partial year. The amount will be paid to you or
to the legal representative of your estate.
VI. If at any time during your continued employment, your
responsibility, duties or title changes, this plan is
subject to revision or termination by the Company at
the time of the foregoing change.