Schedule 14a information


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NameSchedule 14a information
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inspections for Hasbro, including 134 inspections in 2001. Over the years,

Hasbro has successfully worked with its manufacturers to correct any

unacceptable practices discovered during the course of these inspections.

Although serious violations are rarely found, Hasbro has in fact terminated

vendors for
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failure to comply. In addition, on a number of occasions Hasbro has met with

shareholders to discuss its Code of Conduct and compliance procedures, including

findings of third party audits engaged by Hasbro.
In addition to corporate efforts, Hasbro has been a leader in the toy

industry (nationally and internationally) on the issue of workplace standards

and compliance. Hasbro is a member of the Toy Industry Association, Inc. ("TIA")

and Juvenile Products Manufacturers Association ("JPMA") and sits on committees

and forums worldwide to strengthen workplace standards and compliance. For

example, Hasbro was at the forefront of developing industry-wide standards for

fire prevention and emergency preparedness through the International Council of

Toy Industries ("ICTI"). Hasbro was a principal drafter of the factory audit

checklists for the ICTI Code of Business Practices. More recently, Hasbro has

again taken a leadership role in current revisions to the ICTI factory audit

checklists and guidance manual.
To conclude, Hasbro is a leader in the area of global working conditions

and is proud of its efforts both on behalf of the Company and the toy industry

in general. Given Hasbro's strong commitment to the Global Business Ethics

Principles, its extensive independent monitoring program, and its industry

activism, the Board of Directors believes that the Company's current program is

best suited to ensure compliance and leadership on this important issue.

Furthermore, Hasbro believes that annual reporting to shareholders would be

duplicative of existing compliance efforts as well as costly, with no added

benefit to the shareholders or the Company.
For the reasons outlined above, the Board has concluded that the Company's

current Code of Conduct and compliance programs and procedures are in the best

interests of the Company and its shareholders and thus is opposed to the

shareholder proposal.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE AGAINST PROPOSAL NO.

3.
VOTING SECURITIES AND PRINCIPAL HOLDERS THEREOF
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
The following table sets forth information, as of March 25, 2002 (except as

noted), with respect to the ownership of the Common Stock (the only class of

outstanding voting securities of the Company) by certain persons known by the

Company to be the beneficial owners of more than 5% of such stock:

AMOUNT AND NATURE

NAME AND ADDRESS OF OF BENEFICIAL PERCENT OF

BENEFICIAL OWNER OWNERSHIP(1) CLASS

------------------- ----------------- ----------
Capital Group International, Inc. .......................... 20,698,610(2) 12.0

11100 Santa Monica Blvd

Los Angeles, CA 90025

Alan G. Hassenfeld.......................................... 18,689,148(3) 10.7

1027 Newport Avenue

Pawtucket, RI 02862

George W. Lucas, Jr. ....................................... 15,750,000(4) 8.3

c/o Lucasfilm Ltd.

5858 Lucas Valley Road

Nicasio, CA 94946

Ariel Capital Management, Inc. ............................. 14,228,924(5) 8.2

200 E. Randolph Drive

Suite 2900

Chicago, IL 60601

FMR Corp. .................................................. 10,806,113(6) 6.2

82 Devonshire Street

Boston, MA 02109

T. Rowe Price Associates, Inc. ............................. 9,787,813(7) 5.7

100 E. Pratt Street

Suite 2900

Baltimore, MD 21202
---------------

(1) Based upon information furnished by each shareholder or contained in filings

made with the Securities and Exchange Commission.

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(2) Capital Group International, Inc. as the parent of Capital Guardian Trust

Company (which owns 10,059,060 shares or 5.8% of the outstanding shares) and

certain investment management affiliates (collectively the "Capital Group")

may be deemed to have sole dispositive power over 20,698,610 shares of

Common Stock and sole voting power over 18,476,910 of such shares which are

owned by accounts under discretionary investment management by one or more

members of the Capital Group. Share ownership information is as at December

31, 2001 as reported in a Schedule 13G dated January 11, 2002. The Capital

Group disclaims beneficial ownership of these shares.
(3) Includes 8,890,921 shares held as sole trustee for the benefit of his

mother, 829,347 shares held as sole trustee of a trust for Mr. Hassenfeld's

benefit and currently exercisable options or options exercisable within 60

days hereof to purchase 1,431,666 shares. Mr. Hassenfeld has sole voting and

investment authority with respect to all shares except those described in

the following sentence, as to which he shares voting and investment

authority. Also includes 1,101,750 shares owned by The Hassenfeld

Foundation, of which Mr. Hassenfeld is an officer and director, 485,570

shares held as one of the trustees of a charitable lead trust for the

benefit of The Hassenfeld Foundation and 154,216 shares held as one of the

trustees of a trust for the benefit of his mother and her grandchildren. Mr.

Hassenfeld disclaims beneficial ownership of all shares except to the extent

of his proportionate pecuniary interest therein.
(4) Represents exercisable warrants to purchase 6,300,000 shares owned by

LucasFilm Ltd. ("Film") and exercisable warrants to purchase 9,450,000

shares owned by its wholly-owned subsidiary, Lucas Licensing Ltd.

("Licensing"). Mr. Lucas, as founder, controlling person and a director of

Film and Licensing, may be deemed to beneficially own the shares of Common

Stock which may be purchased upon exercise of these warrants. See "Certain

Relationships and Related Transactions".
(5) Ariel Capital Management, Inc. an investment advisor, has sole dispositive

authority over 14,213,749 shares and sole voting power over 12,514,534

shares as a result of acting as an investment advisor to various investment

advisory clients. Share ownership information is as of December 31, 2001 as

reported in a Schedule 13G dated December 31, 2001.
(6) FMR Corp. has sole dispositive power over 10,806,113 shares and sole voting

power over 549,164 shares. Fidelity Management & Research Company, a

wholly-owned subsidiary of FMR Corp., is the beneficial owner of 10,256,949

shares of the Company's Common Stock. Includes 1,092,269 shares which could

be acquired if certain convertible senior debentures became convertible.

Share ownership information is as of December 31, 2001 as reported in a

Schedule 13G dated February 14, 2002.
(7) These shares are owned by various individual and institutional investors to

which T. Rowe Price Associates, Inc. (Price Associates) serves as investment

adviser with power to direct investments and/or sole power to vote the

securities. Price Associates has sole dispositive power over 9,787,813

shares and sole voting power over 2,430,157 shares. For purposes of the

reporting requirements of the Securities Exchange Act of 1934, Price

Associates is deemed to be a beneficial owner of such securities; however,

Price Associates expressly disclaims that it is, in fact, the beneficial

owner of such securities. Share ownership information is as of December 31,

2001 as reported in a Schedule 13G dated February 14, 2002.
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SECURITY OWNERSHIP OF MANAGEMENT
The following table sets forth information, as of March 25, 2002, with

respect to the ownership of the Common Stock (the only class of outstanding

equity securities of the Company) by each current director of the Company or

nominee for election to the Board, each named executive officer and by all

directors and executive officers as a group. Unless otherwise indicated, each

person has sole voting and dispositive power with respect to such shares.

N
AME OF DIRECTOR, NOMINEE COMMON PERCENT

OR EXECUTIVE OFFICER(1) STOCK OF CLASS

------------------------- ---------- --------
Basil L. Anderson........................................... 1,000 *

Alan R. Batkin(2)........................................... 36,079 *

Frank J. Biondi, Jr......................................... -- *

E. Gordon Gee(3)............................................ 8,088 *

Brian Goldner(4)............................................ 167,667 *

Harold P. Gordon(5)......................................... 667,792 *

Alan G. Hassenfeld(6)....................................... 18,689,148 10.7

Sylvia K. Hassenfeld(7)..................................... 1,202,137 *

Claudine B. Malone(8)....................................... 14,467 *

Norma T. Pace(9)............................................ 26,013 *

E. John Rosenwald, Jr.(10).................................. 235,712 *

Eli J. Segal(11)............................................ 2,716 *

Carl Spielvogel(12)......................................... 56,164 *

Paula Stern................................................. -- *

Preston Robert Tisch(13).................................... 17,792 *

Alfred J. Verrecchia(14).................................... 1,268,551 *

E. David Wilson(15)......................................... 488,286 *

All Directors and Executive Officers as a Group (includes 21

persons)(16).............................................. 22,591,239 12.7
---------------

* Less than one percent.
(1) Information in this table is based upon information furnished by each

director and executive officer.
(2) Includes currently exercisable options granted under the Director Plan to

purchase an aggregate of 11,250 shares as well as 23,142 shares deemed to

be held in Mr. Batkin's stock unit account under the Deferred Plan.
(3) Represents currently exercisable options and options exercisable within

sixty days hereof granted under the Director Plan to purchase 6,750 shares

as well as 1,338 shares deemed to be held in Mr. Gee's account under the

Deferred Plan.
(4) Represents currently exercisable options to purchase 106,667 shares and

61,000 shares of restricted stock granted to Mr. Goldner under the

Company's employee stock option plans.
(5) Includes currently exercisable options and options exercisable within sixty

days hereof granted under the Company's stock option plans to purchase an

aggregate of 643,900 shares as well as 3,531 shares deemed to be held in

Mr. Gordon's stock unit account under the Deferred Plan. Excludes

fractional shares held in Mr. Gordon's account under the Company's Dividend

Reinvestment and Cash Stock Purchase Program.
(6) See note (3) to the immediately preceding table.
(7) Includes currently exercisable options granted under the Director Plan to

purchase an aggregate of 11,250 shares, 1,101,750 shares owned by The

Hassenfeld Foundation, of which Mrs. Hassenfeld is an officer and director,

and as to the shares of which she disclaims beneficial ownership, and 3,196

shares deemed to be held in Mrs. Hassenfeld's stock unit account under the

Deferred Plan. Does not include
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the shares of Common Stock held in trust for Mrs. Hassenfeld's benefit

referred to in note (3) to the immediately preceding table.
(8) Includes 2,250 currently exercisable options granted under the Director

Plan as well as 517 shares deemed to be held in Mrs. Malone's stock unit

account under the Deferred Plan.
(9) Includes currently exercisable options granted under the Director Plan to

purchase an aggregate of 11,250 shares as well as 13,211 shares deemed to

be held in Mrs. Pace's stock unit account under the Deferred Plan.
(10) Includes currently exercisable options granted under the Director Plan to

purchase an aggregate of 11,250 shares as well as 21,962 shares deemed to

be held in Mr. Rosenwald's stock unit account under the Deferred Plan. Does

not include shares held by Bear, Stearns & Co. Inc. in an investment

account. Mr. Rosenwald is Vice Chairman of Bear, Stearns & Co. Inc.
(11) Consists of 2,250 currently exercisable options granted under the Director

Plan and 466 shares deemed to be held in Mr. Segal's stock unit account

under the Deferred Plan.
(12) Includes currently exercisable options granted under the Director Plan to

purchase an aggregate of 11,250 shares as well as 6,408 shares deemed to be

held in Mr. Spielvogel's stock unit account under the Deferred Plan.
(13) Includes currently exercisable options granted under the Director Plan to

purchase an aggregate of 11,250 shares as well as 3,167 shares deemed to be

held in Mr. Tisch's stock unit account under the Deferred Plan.
(14) Includes currently exercisable options and options exercisable within sixty

days hereof to purchase an aggregate of 1,005,583 shares as well as 40,000

deferred restricted stock units granted under the Company's employee stock

option plans. Does not include 151,875 shares owned by Mr. Verrecchia's

wife, as to which Mr. Verrecchia disclaims beneficial ownership.
(15) Includes currently exercisable options and options exercisable within sixty

days hereof to purchase 453,207 shares as well as 10,000 deferred

restricted stock units granted under the Company's employee stock option

plans. Also includes 79 shares (excluding fractional shares) deemed to be

held in Mr. Wilson's account under the Deferred Compensation Plan.
(16) Of these shares, all directors and executive officers as a group have sole

voting and dispositive power with respect to 20,849,703 shares and have

shared voting and/or investment power with respect to 1,741,536 shares.

Includes 4,412,463 shares purchasable by directors and executive officers

upon exercise of currently exercisable options, or options exercisable

within sixty days hereof, and 61,000 shares of restricted stock granted

under the Company's stock option plans; 78,261 shares deemed to be held in

stock unit accounts under the Deferred Plan and the Deferred Compensation

Plan; and 84,000 shares deemed to be held in deferred restricted stock unit

accounts under the Company's Employee Non-Qualified Stock Plan.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934, as amended, requires

the Company's directors and executive officers, and persons who own more than
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