EXHIBIT 10(ff)
FORM OF
AMENDMENT
DATED AS OF MARCH 10, 2000
TO
EMPLOYMENT AGREEMENT
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THE AGREEMENT by and between Hasbro, Inc., a Rhode Island
corporation (the "Company"), and ___________________________
(the "Executive"), dated as of the ___ day of _________________
is hereby amended as follows, effective March 10, 2000.
1. The preamble is amended and restated to read in its
entirety as follows:
"The Compensation and Stock Option Committee (the "Committee")
of the Board of Directors of the Company (the "Board"), has
determined that it is in the best interests of the Company and
its shareholders to assure that the Company will have the
continued dedication of the Executive, notwithstanding the
possibility, threat or occurrence of a Change of Control (as
defined below) of the Company. The Board believes it is
imperative to diminish the inevitable distraction of the
Executive by virtue of the personal uncertainties and risks
created by any threatened Change of Control, to encourage the
Executive's full attention and dedication to the Company
currently and in the event of any threatened Change of Control,
and to provide the Executive with compensation and benefits
arrangements upon a Change of Control which ensure that the
compensation and benefits expectations of the Executive will be
satisfied and which are competitive with those of other
corporations. Therefore, in order to accomplish these
objectives, the Committee has caused the Company to enter into
this Agreement."
2. Section 2 is hereby amended to read in its entirety as
follows:
"2. Change of Control. For the purpose of this Agreement, a
"Change of Control" shall mean:
(a) The acquisition by any individual, entity or group
(within the meaning of Section 13(d)(3) or 14(d)(2) of the
Securities Exchange Act of 1934, as amended (the "Exchange
Act")) of beneficial ownership (within the meaning of Rule 13d-3
promulgated under the Exchange Act) of 20% or more of either (i)
the then outstanding shares of common stock of the Company (the
"Outstanding Company Common Stock") or (ii) the combined voting
power of the then outstanding voting securities of the Company
entitled to vote generally in the election of directors (the
"Outstanding Company Voting Securities"); provided, however,
that the following acquisitions shall not constitute a Change of
Control: (i) any acquisition directly from the Company, (ii) any
acquisition by the Company or any of its subsidiaries, (iii) any
acquisition by any employee benefit plan (or related trust)
sponsored or maintained by the Company or any of its
subsidiaries, (iv) any acquisition by Xxxx or Xxxxxx Xxxxxxxxxx,
members of their respective immediate families or heirs of Xxxx
or Xxxxxx Xxxxxxxxxx or of any member of their respective
immediate families, the Xxxxxx Xxxxxxxxxx Trust, the Xxxxxxx
Xxxxxxxxxx Trust, the Xxxxxxx Xxxxxxxxxx Trust, the Xxxx
Xxxxxxxxxx Trust, the Hassenfeld Foundation, any trust or
foundation established by or for the primary benefit of any of
the foregoing or controlled by one or more of any of the
foregoing, or any affiliates or associates (as such terms are
defined in Rule 12b-2 promulgated under the Exchange Act) of any
of the foregoing (collectively, the "Hassenfeld Group"), (v) any
acquisition by any corporation with respect to which, following
such acquisition, more than 60% of, respectively, the then
outstanding shares of common stock of such corporation and the
combined voting power of the then outstanding voting securities
of such corporation entitled to vote generally in the election
of directors is then beneficially owned, directly or indirectly,
by all or substantially all of the individuals and entities who
were the beneficial owners, respectively, of the Outstanding
Company Common Stock and Company Voting Securities immediately
prior to such acquisition in substantially the same proportions
as their ownership, immediately prior to such acquisition, of
the Outstanding Company Common Stock and Outstanding Company
Voting Securities, as the case may be.
(b) Individuals who, as of the date hereof, constitute the
Board (the "Incumbent Board") cease for any reason to constitute
at least a majority of the Board; provided, however, that any
individual becoming a director subsequent to the date hereof
whose appointment, election, or nomination for election by the
Company's shareholders, was approved by a vote of at least a
majority of the directors then comprising the Incumbent Board
shall be considered as though such individual were a member of
the Incumbent Board, but excluding, for this purpose, any such
individual whose initial assumption of office occurs as a result
of either an actual or threatened election contest (as such
terms are used in Rule 14a-11 of Regulation 14A promulgated
under the Exchange Act) or other actual or threatened
solicitation of proxies or consents; or
(c) Consummation of a reorganization, merger or
consolidation, in each case, with respect to which all or
substantially all of the individuals and entities who were the
beneficial owners, respectively, of the Outstanding Company
Common Stock and Outstanding Company Voting Securities
immediately prior to such reorganization, merger or
consolidation do not, following such reorganization, merger or
consolidation, beneficially own, directly or indirectly, more
than 60% of, respectively, the then outstanding shares of common
stock and the combined voting power of the then outstanding
voting securities entitled to vote generally in the election of
directors, as the case may be, of the corporation resulting from
such reorganization, merger or consolidation in substantially
the same proportions as their ownership, immediately prior to
such reorganization, merger or consolidation of the Outstanding
Company Common Stock and Outstanding Company Voting Securities,
as the case may be; or
(d) Approval by the shareholders of the Company of a complete
liquidation or dissolution of the Company or consummation of the
sale or other disposition of all or substantially all of the
assets of the Company, other than to a corporation, with respect
to which following such sale or other disposition, more than 60%
of, respectively, the then outstanding shares of common stock of
such corporation and the combined voting power of the then
outstanding voting securities of such corporation entitled to
vote generally in the election of directors is then beneficially
owned, directly or indirectly, by all or substantially all of
the individuals and entities who were the beneficial owners,
respectively, of the Outstanding Company Common Stock and
Outstanding Company Voting Securities immediately prior to such
sale or other disposition in substantially the same proportion
as their ownership, immediately prior to such sale or other
disposition, of the Outstanding Company Common Stock and
Outstanding Company Voting Securities, as the case may be."
3. Section 4(b) is hereby amended to read in its entirety as
follows:
"(b) Compensation. (i) Base Salary. During the Employment
Period, the Executive shall receive an annual base salary
("Annual Base Salary"), which shall be paid at a bi-weekly rate,
at least equal to 26 times the highest bi-weekly base salary
paid or payable, including by reason of any deferral, to the
Executive by the Company and its affiliated companies (as
defined below) in respect of the 52 week period immediately
preceding the bi-weekly period in which the Effective Date
occurs. During the Employment Period, the Annual Base Salary
shall be reviewed at least annually and shall be increased at
any time and from time to time as shall be substantially
consistent with increases in base salary generally awarded in
the ordinary course of business to other peer executives of the
Company and its affiliated companies. Any increase in Annual
Base Salary shall not serve to limit or reduce any other
obligation to the Executive under this Agreement. Annual Base
Salary shall not be reduced after any such increase and the term
Annual Base Salary as utilized in this Agreement shall refer to
Annual Base Salary as so increased. As used in this Agreement,
the term "affiliated companies" shall include any company
controlled by, controlling or under common control with, the
Company.
(ii) Annual Bonus. In addition to Annual Base Salary, the
Executive shall be awarded, for each fiscal year ending during
the Employment Period, an annual bonus (the "Annual Bonus") in
cash at least equal to the Executive's highest target bonus for
the fiscal year in which the Effective Date occurs provided,
however, that if no target bonus is established for such fiscal
year, then the Annual Bonus shall equal the average annualized
(for any fiscal year consisting of less than twelve full months
or with respect to which the Executive has been employed by the
Company for less than twelve full months) bonus paid or payable,
including by reason of any deferral, to the Executive by the
Company and its affiliated companies in respect of the three
fiscal years immediately preceding the fiscal year in which the
Effective Date occurs provided, however, that if the Executive
has not been employed for all of such period, the average
annualized bonuses over the actual number of full or partial
fiscal years of employment shall be utilized for this
computation. Each such Annual Bonus shall be paid no later than
the fifteenth day of the third month of the fiscal year next
following the fiscal year for which the Annual Bonus is awarded,
unless the Executive shall elect to defer the receipt of such
Annual Bonus.
(iii) Special Bonus. In addition to Annual Base Salary and
Annual Bonus payable as hereinabove provided, if the Executive
remains employed with the Company and its affiliated companies
through the first anniversary of the Effective Date, the Company
shall pay to the Executive a special bonus (the "Special Bonus")
in recognition of the Executive's services during the crucial
one-year transition period following the Change of Control in
cash equal to the sum of (A) 26 times the average bi-weekly base
salary paid or payable, including by reason of any deferral, to
the Executive by the Company and its affiliated companies during
the 260-week period immediately preceding the week in which the
Effective Date occurs (such product, the "Average Annual
Salary") and (B) the higher of (i) the Highest Annual Bonus (as
defined in Section 6(a)(i)A. hereof), and (ii) the average
annualized (for any fiscal year consisting of less than twelve
full months or with respect to which the Executive has been
employed by the Company for less than twelve full months) bonus
paid or payable, including by reason of any deferral, to the
Executive by the Company and its affiliated companies during the
five fiscal year period immediately preceding the fiscal year in
which the Effective Date occurs (the "Average Annual Bonus")
provided, however, that if the Executive has not been employed
for all of such period, the average annualized bonuses over the
actual number of full or partial fiscal years of employment
shall be utilized for this computation. The Special Bonus shall
be paid no later than 30 days following the first anniversary of
the Effective Date.
(iv) Incentive, Profit Sharing, Savings and Retirement Plans.
During the Employment Period, the Executive shall be entitled to
participate in all incentive, profit sharing, savings and
retirement plans, practices, policies and programs applicable
generally to other peer executives of the Company and its
affiliated companies, but in no event shall such plans,
practices, policies and programs provide the Executive with
incentive opportunities (measured with respect to both regular
and special incentive opportunities, to the extent, if any, that
such distinction is applicable), profit sharing and savings
opportunities and retirement benefit opportunities, in each
case, less favorable, in the aggregate, than the most favorable
of those provided by the Company and its affiliated companies
for the Executive under such plans, practices, policies and
programs as in effect at any time during the 90-day period
immediately preceding the Effective Date or if more favorable to
the Executive, those provided generally at any time after the
Effective Date to other peer executives of the Company and its
affiliated companies; provided however that the amounts payable
pursuant to this Section 4(b)(iv) are not intended to duplicate
annual bonuses otherwise payable pursuant to Section 4(b)(ii).
(v) Welfare Benefit Plans. During the Employment Period, the
Executive and/or the Executive's family, as the case may be,
shall be eligible for participation in and shall receive all
benefits under welfare benefit plans, practices, policies and
programs provided by the Company and its affiliated companies
(including, without limitation, medical, prescription, dental,
disability, salary continuance, employee life, group life,
accidental death and travel accident insurance plans and
programs) to the extent applicable generally to other peer
executives of the Company and its affiliated companies, but in
no event shall such plans, practices, policies and programs
provide the Executive with benefits which are less favorable, in
the aggregate, than the most favorable of such plans, practices,
policies and programs in effect for the Executive at any time
during the 90-day period immediately preceding the Effective
Date or, if more favorable to the Executive, those provided
generally at any time after the Effective Date to other peer
executives of the Company and its affiliated companies.
(vi) Expenses. During the Employment Period, the Executive
shall be entitled to receive prompt reimbursement for all
reasonable expenses incurred by the Executive in accordance with
the most favorable policies, practices and procedures of the
Company and its affiliated companies in effect for the Executive
at any time during the 90-day period immediately preceding the
Effective Date or, if more favorable to the Executive, as in
effect generally at any time thereafter with respect to other
peer executives of the Company and its affiliated companies.
(vii) Fringe Benefits. During the Employment Period, the
Executive shall be entitled to fringe benefits, including,
without limitation, auto allowances, in accordance with the most
favorable plans, practices, programs and policies of the Company
and its affiliated companies in effect for the Executive at any
time during the 90-day period immediately preceding the
Effective Date or, if more favorable to the Executive, as in
effect generally at any time thereafter with respect to other
peer executives of the Company and its affiliated companies.
(viii) Office and Support Staff. During the Employment
Period, the Executive shall be entitled to an office or offices
of a size and with furnishings and other appointments, and to
exclusive personal secretarial and other assistance, at least
equal to the most favorable of the foregoing provided to the
Executive by the Company and its affiliated companies at any
time during the 90-day period immediately preceding the
Effective Date or, if more favorable to the Executive, as
provided generally at any time thereafter with respect to other
peer executives of the Company and its affiliated companies.
(ix) Vacation. During the Employment Period, the Executive
shall be entitled to paid vacation in accordance with the most
favorable plans, policies, programs and practices of the Company
and its affiliated companies as in effect for the Executive at
any time during the 90-day period immediately preceding the
Effective Date or, if more favorable to the Executive, as in
effect generally at any time thereafter with respect to other
peer executives of the Company and its affiliated companies."
4. Sections 6(a)(I)A. and 6(a)(I)B. are hereby amended to
read in their entirety as follows:
"6. Obligations of the Company upon Termination. (a) Good
Reason or during the Window Period; Other Than for Cause, Death
or Disability. If, during the Employment Period, the Company
shall terminate the Executive's employment other than for Cause,
death or Disability or the Executive shall terminate employment
either for Good Reason or without any reason during the Window
Period:
(i) the Company shall pay to the Executive in a lump sum in
cash within 30 days after the Date of Termination the aggregate
of the following amounts (such aggregate shall be hereinafter
referred to as the "Special Termination Amount"):
A. The sum of (1) the Executive's Annual Base Salary
through the Date of Termination to the extent not theretofore
paid, (2) the Executive's Annual Bonus for the last fiscal year,
to the extent not theretofore paid, (3) the product of (x) the
greater of (i) the Executive's target bonus for the fiscal year
in which the Date of Termination occurs, and (ii) the Annual
Bonus (such greater amount shall be hereinafter referred to as
the "Highest Annual Bonus") and (y) a fraction, the numerator of
which is the number of days in the current fiscal year through
the Date of Termination, and the denominator of which is 365 and
(4) the Special Bonus, if due to the Executive pursuant to
Section 4(b)(iii) of this Agreement, to the extent not
theretofore paid and (5) any compensation previously deferred by
the Executive (together with any accrued interest or earnings
thereon) and any accrued vacation pay, in each case to the
extent not theretofore paid (the sum of the amounts described in
clauses (1), (2), (3), (4) and (5) shall be hereinafter referred
to as the "Accrued Obligations"); and
B. the amount equal to the product of (1) two and (2) the
sum of (x) the Executive's Average Annual Salary and (y) the
greater of (A) the Highest Annual Bonus and (B) the Average
Annual Bonus; provided, however, that if the Special Bonus has
not been paid to the Executive because such termination occurs
prior to the first anniversary of the Effective Date, such
amount shall be increased by the amount of the Special Bonus;
and"
5. The first sentence of Section 9(b) is hereby amended to
read in its entirety as follows:
"(b) Subject to the provisions of Section 9(c), all
determinations required to be made under this Section 9,
including whether and when a Gross-Up Payment is required and
the amount of such Gross-Up Payment and the assumptions to be
utilized in arriving at such determination, shall be made by
KPMG LLP, or such other accounting firm as shall then be serving
as the auditors for the Company (the "Accounting Firm") which
shall provide detailed supporting calculations both to the
Company and the Executive within 15 business days of the receipt
of notice from the Executive that there has been a Payment, or
such earlier time as is requested by the Company."
Except as herein amended the Employment Agreement between the
Company and the Executive shall remain in full force and effect.
IN WITNESS WHEREOF, the Executive has hereunto set the
Executive's hand and, pursuant to the authorization from the
Compensation and Stock Option Committee of its Board of
Directors, the Company has caused these presents to be executed
in its name of its behalf, all as of the day and year first
above written.
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HASBRO, INC.
By --------------------------
