|
|
 | | | |
- close
- close
- close
- close
This excerpt taken from the HAS DEF 14A filed Apr 6, 2009. Actual
Performance Under the 2006 Contingent Stock Performance
Awards
Shares earned under the July 2006 contingent stock performance
awards were earned and paid to recipients in February of 2009.
In determining the 2008 equity award target values the Committee
did not feel that past equity awards should have a significant
impact. However, in conjunction with the Company’s stock
ownership guidelines, which are described below, the Committee
is reviewing each executive officer’s progress in achieving
their targeted stock ownership level as a criterion in
establishing future target equity grant levels. To the extent
that an officer is not making sufficient progress toward
achieving and maintaining the targeted stock ownership level,
equity grants to that officer in the future may be reduced.
The Company does not manage the timing of equity grants to
attempt to give participants the benefit of material non-public
information. Grants are made at times when the Company believes
it is not in possession of material non-public information and
when major subsequent announcements are not currently
anticipated. Further, all option grants are made with an
exercise price at or above the average of the high and low sales
prices of the Company’s common stock on the date of grant.
The Committee believes the equity compensation awards to the
Company’s executive officers are appropriate to properly
incent these officers to achieve maximum performance, and to
align their interests with those of the Company’s
shareholders, while not incenting the executive officers to take
undue risks or otherwise take actions which are contrary to the
best interests of the Company.
The stock option and performance share award grants to the
Company’s named executive officers in 2008 are reflected in
the Grants of Plan-Based Awards table that follows this report.
The grant date for the Company’s yearly stock performance
awards and options in fiscal 2008 to officers and other eligible
employees was February 13, 2008.
The Company has only infrequently used restricted stock and
restricted stock units as a reward and retention mechanism.
Mr. Goldner was granted 57,787 restricted stock units in
connection with his promotion to President and Chief Executive
Officer in May 2008. In 2008, no other executive officers
received grants of restricted stock or restricted stock units.
The Company has share ownership guidelines which apply to all
employees at or above the Senior Vice President level. The share
ownership guidelines establish target share ownership levels
which executives are expected to achieve over a five-year period
and then maintain, absent extenuating circumstances which are
approved by the Company’s Human Resources Department, for
as long as they remain with the Company. The target ownership
levels are expressed as a percentage of the executives’
base salary and range from 50% of yearly base salary for certain
Senior Vice Presidents to 500% of base salary for the
Company’s Chief Executive Officer.
In making the yearly equity grants the Committee specifically
approves the grants for every member of the Company’s
senior management team, which includes every executive officer.
The Committee also approves the total equity grant pool for all
other eligible employees of the Company, with the individual
grants from that pool being made from a list prepared by the
Company’s senior management which is available for the
Committee’s review. Other than the annual equity grants,
off-cycle equity grants are made during the year generally only
in the case of new hires or in connection with significant
promotions. All of these off-cycle grants are also reviewed and
approved by the Committee.
Executive
Benefits
In addition to receipt of salary, management incentive awards
and equity compensation, the Company’s U.S. based
officers also participate in certain employee benefit programs
provided by the Company.
Beginning in 2008, the Company provides retirement benefits to
it employees primarily through the 401(k) Retirement Savings
Plan (the “401(k) Plan”) and the Supplemental Benefit
Retirement Plan (the “Supplemental Plan”). The
Company’s Pension Plan (the “Pension Plan”) was
frozen effective December 31, 2007. The enhanced 401(k)
Plan and Supplemental Plan, which are described starting on
page 33 of this proxy statement, provide company matching
contributions, an annual company contribution of 3% of aggregate
salary and bonus and a transition contribution ranging from 1%
to 9% for the years 2008 through 2012 for participants meeting
certain age and service requirements. In lieu of the annual
company and transition contributions, Mr. Verrecchia and
Mr. Hargreaves receive certain retirement benefits
discussed below. Other executive officers are eligible to
participate in the 401(k) Plan and the Supplemental Plan on the
same basis as all other U.S. Hasbro employees.
Executive officers hired prior to December 31, 2007,
continue to participate in the Pension Plan and the pension
portion of the Supplemental Plan, which is described starting on
page 33 of this proxy statement, but, except for
Mr. Hargreaves who is discussed below, will not accrue
additional benefits after December 31, 2007, since these
plans are frozen.
The Supplemental Plan is intended to provide a competitive
benefit for executive officers whose employer-provided pension
benefits and retirement contributions would otherwise be
limited. However, the Supplemental Plan is designed only to
provide the benefit which the executive would have accrued under
the Company’s Pension Plan and 401(k) Plan if the Code
limits had not applied. It does not further enhance those
benefits.
The amount of the Company’s contributions to the named
executive officers under both the 401(k) Plan and the
Supplemental Plan (401(k)), are included in the “All Other
Compensation” column of the Summary Compensation Table that
follows this report.
Mr. Verrecchia is party to a Post-Employment Agreement with
the Company which provides certain enhanced retirement benefits.
The Post-Employment Agreement is described starting on
page 35 of this proxy statement. In light of the
significant reduction in projected retirement income resulting
from the retirement program redesign, the Company elected to
provide Mr. Hargreaves, who has been with the Company for
26 years, with a retirement agreement which effectively
grandfathered for Mr. Hargreaves the Company’s
retirement program as it was in effect prior to January 1,
2008. Mr. Hargreaves retirement agreement is also described
starting on page 35 of this proxy statement.
The executive officers of the Company are eligible for life
insurance benefits on the terms applicable to the Company’s
other employees. In addition, prior to his retirement from the
Company on December 31, 2008, Mr. Verrecchia was
provided with executive life insurance. The cost of the
Company’s premiums for executive life insurance programs
for Mr. Verrecchia is included in the “All Other
Compensation” column of the Summary Compensation Table.
The Company’s executive officers participate in the same
medical and dental benefit plans as are provided to the
Company’s other employees.
Executive officers are also eligible to participate in the
Company’s Nonqualified Deferred Compensation Plan, which is
available to all of the Company’s employees who are in band
40 (director level) or above whose compensation is equal to or
greater than $105,000 for 2008 ($110,000 for 2009). The
Nonqualified Deferred Compensation Plan allows participants to
defer compensation into various hypothetical investment
vehicles, the performance of which determines the return on
compensation deferred under the plan. Potential investment
choices include the Company’s Common Stock, as well as
other equity indices. Earnings on compensation deferred by the
executive officers do not exceed the market returns on the
relevant investments and are the same as the returns earned by
other non-executive officer employees deferring compensation
into the applicable investment vehicles.
The Company reimburses designated executive officers for the
cost of certain tax, legal and financial planning services they
obtain from third parties provided that such costs are within
the limits established by the Company. The annual limit on these
costs for the Chief Executive Officer is $10,000, and for the
other designated executive officers is $5,000. The cost to the
Company for this reimbursement to certain of the named executive
officers is included in the “All Other Compensation”
column of the Summary Compensation Table.
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| |||||||
