Hasbro Inc – ‘10-K405’ for 12/27/98

As of:  Monday, 3/29/99   ·   For:  12/27/98   ·   Accession #:  46080-99-5   ·   File #:  1-06682   ·   Correction:  This Filing was Corrected by the SEC on 3/30/99. ®

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Annual Report — [x] Reg. S-K Item 405   —   Form 10-K
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: 10-K405     10-K Document                                         39    166K 
 2: EX-10       Exhibit 10(D)                                         79±   274K 
 3: EX-10       Exhibit 10(E)                                          6±    27K 
 4: EX-10       Exhibit 10(F)                                          8±    34K 
 5: EX-10       Exhibit 10(G)                                          2±    12K 
 6: EX-10       Exhibit 10(H)                                         29±   122K 
 7: EX-10       Exhibit 10(I)                                         29±   122K 
 8: EX-10       Exhibit 10(J)                                         29±   122K 
 9: EX-10       Exhibit 10(K)                                         29±   122K 
10: EX-10       Exhibit 10(Rr)                                        16±    74K 
11: EX-10       Exhibit 10(Ss)                                         6±    30K 
12: EX-11       Statement re: Computation of Earnings Per Share        1      8K 
13: EX-12       Statement re: Computation of Ratios                    1      8K 
14: EX-13       Annual or Quarterly Report to Security Holders        34±   145K 
15: EX-22       Published Report Regarding Matters Submitted to a      2±    11K 
                          Vote of Security Holders                               
16: EX-24       Exhibit 24(A)                                          1      9K 
17: EX-27       Financial Data Schedule (Pre-XBRL)                     1      8K 

10-K405   —   10-K Document
Document Table of Contents

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SECURITIES AND EXCHANGE COMMISSION  

Washington, D. C.  20549  

Form  10-K  

Annual Report Pursuant to Section 13 or 15(d) 
of the Securities Exchange Act of 1934

For the fiscal year ended December 27, 1998   Commission file number 1-6682     
                     -----------------                          ------

Hasbro, Inc.  
--------------------  
(Name of Registrant)  
Rhode Island                                          05-0155090    
------------------------                                -------------------     
(State of Incorporation)                                 (I.R.S. Employer       
                                                   Identification No.)

1027 Newport Avenue, Pawtucket, Rhode Island 02861  
--------------------------------------------------  
(Address of Principal Executive Offices)  

(401) 431-8697  
--------------  

Securities registered pursuant to Section 12(b) of the Act:                     

                                               Name of each exchange
Title of each class                             on which registered 
-------------------                            ---------------------

Common Stock                                        American Stock Exchange     
Preference Share Purchase Rights                    American Stock Exchange     

Securities registered pursuant to Section 12(g) of the Act:  None               

Indicate by check mark whether the registrant (1) has filed all reports         
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of   
1934 during the preceding 12 months (or for such shorter period that the        
registrant was required to file such reports), and (2) has been subject to      
such filing requirements for the past 90 days. Yes[X] or No[ ].                 

Indicate by check mark if disclosure of delinquent filers pursuant to Item      
405 of Regulation S-K is not contained herein, and will not be contained, to    
the best of registrant's knowledge, in definitive proxy or information          
statements incorporated by reference in Part II of this Form 10-K or any        
amendment to this Form 10-K. [X]                                                

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The aggregate market value of the voting stock held by non-affiliates of the    
registrant computed by reference to the price at which the stock was sold on    
March 19, 1999 was $5,076,732,539.                                              

The number of shares of Common Stock outstanding as of March 19, 1999 was       
195,889,550.                                                                    

DOCUMENTS INCORPORATED BY REFERENCE                                             

Portions of registrant's definitive proxy statement for its 1999 Annual     
Meeting of Shareholders are incorporated by reference into Part III of this     
Report.                                                                         

Selected information contained in registrant's Annual Report to             
Shareholders for the fiscal year ended December 27, 1998, is included as        
Exhibit 13, and incorporated by reference into Parts I and II of this Report.   

PART I  

ITEM  1.  BUSINESS                                                              
--------                                                    
(a) General Development of Business                                         
-------------------------------                                     
Except as expressly indicated or unless the context otherwise requires, as  
used herein, the "Company" means Hasbro, Inc., a Rhode Island corporation       
organized on January 8, 1926, and its subsidiaries.                             

The Company is a worldwide leader in the design, manufacture and marketing  
of toys, games, interactive software, puzzles and infant products. Included     
in its offerings are games, including traditional board and card, hand-held     
electronic and interactive CD-ROM, and puzzles, preschool, boys' action and     
girls' toys, dolls, plush products and infant products. The Company also        
licenses various trademarks, characters and other property rights for use in    
connection with the sale by others of noncompeting toys and non-toy products.   
Both internationally and in the U.S., its PLAYSKOOL, KENNER, TONKA, GALOOB,     
ODDZON, LARAMI, MILTON BRADLEY, PARKER BROTHERS, TIGER and HASBRO INTERACTIVE   
products provide children and families with what the Company believes to be     
the highest quality and most recognizable toys and games in the world.          

(b) Description of Business Products                                        
--------------------------------                                    
The Company's products are categorized for marketing purposes as follows:   

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(i) Toys and Games                                                      
--------------                                                  
Boys' toys are offered in a wide range of products, many of which are tied  
to entertainment properties, including STAR WARS and BATMAN action figures      
and accessories. The Company also offers such classic properties as G.I. JOE,   
ACTION MAN, STARTING LINE-UP, TRANSFORMERS action figures, the TONKA line of    
trucks, vehicles including the WINNER'S CIRCLE line of die cast vehicle         
assortments and the NERF line of soft action play equipment. In 1999, the       
Company will be launching a comprehensive range of action figures and           
accessories using characters associated with Lucasfilms' STAR WARS: EPISODE     
1: THE PHANTOM MENACE as well as the G.I. JOE CLASSIC COLLECTION, celebrating   
the 35th birthday of this great American hero, ANIMORPHS TRANSFORMERS, a line   
of NASCAR MICRO MACHINES and an extensive line of POKEMON toys and              
collectibles.                                                                   

Hasbro's girls toys include TV promoted large dolls, such as 1998's number  
one selling MCDONALDLAND HAPPY MEAL GIRL, the MY LITTLE PONY line of small      
dolls as well as the classic RAGGEDY ANN and RAGGEDY ANDY rag dolls. In 1999    
the company will be introducing new large dolls, launching a line of products   
designed to help celebrate the 50th anniversary of the CLASSIC PEANUTS          
license, expanding the girls POKEMON product line, as well as expanding the     
POUND PUPPIES and SPICE GIRLS lines.                                            

The preschool business is a portfolio of three key brands: PLAYSKOOL,       
BARNEY and TELETUBBIES.  The PLAYSKOOL line includes such well-known products   
as MR. POTATO HEAD, SIT 'N SPIN, GLOWORM, as well as a successful line of       
infant toys and toddler role-play products. The BARNEY brand includes a         
complete line of preschool toys such as PLAY ALONG BARNEY and the BARNEY SONG   
MAGIC BANJO, featuring that adorable purple dinosaur and his friends. The new   
PBS television show, TELETUBBIES, inspired a line of products featuring the     
lovable quartet of TINKY WINKY, DIPSY, LALA and PO.  Included on a list of      
many new products being introduced during 1999 are the PLAYSKOOL KICK START     
GYM, SING 'N STRUM BARNEY and TELETUBBIES TUMMY SURPRISE plush dolls.           

Creative Play items for both girls and boys include such classic lines as   
PLAY-DOH, EASY-BAKE OVEN, both of which enjoyed record years in 1998,           
TINKERTOYS construction toys and LITE-BRITE and SPIROGRAPH design toys.         
During 1999, the Company will be offering new PLAY-DOH playsets, licensed       
refill bake sets for the EASY-BAKE OVEN, including KELLOGS POP TARTS SNACK      
STIX, which allow children to bake fruity flavored cookie sticks, as well as    
a STAR WARS PICTURE REFILL for LITE-BRITE. Internationally the Company will     
continue to expand and develop the creative play business with the GET SET      
and ART ATTACK product lines.                                                   

The LARAMI line of toys features a comprehensive range of water products,   
including the SUPER SOAKER line, celebrating its tenth anniversary in 1999.     

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The ODDZON range includes the KOOSH and VORTEX brands of sports and         
activity products, the RUBIK'S brand of logic puzzles plus the CAP CANDY        
brand of interactive candy and the SOUND BITES brand of electronic              
interactive candy - which allows one to hear sounds inside one's head while     
eating candy. New for 1999 in the ODDZON line will be the MARK MCGUIRE VORTEX   
power bat, LOOP DARTS, a `soft' dart-board game and several interactive candy   
additions, including new M&M MARS licensed candy dispensers and a SOUND BITES   
radio where consumers can listen to their favorite radio station in their       
head.                                                                           

The Company markets its games and puzzles under several well known brands.  
MILTON BRADLEY maintains a line of board, strategy and word games, skill and    
action games, hand-held electronic games and travel games with a diversified    
line of more than 200 games and puzzles for children and adults. The            
Company's staple items include BATTLESHIP, THE GAME OF LIFE, SCRABBLE, CHUTES   
AND LADDERS, CANDY LAND, TROUBLE, MOUSETRAP, OPERATION, HUNGRY HUNGRY HIPPOS,   
CONNECT FOUR, TWISTER and BIG BEN puzzles. The Company also provides games      
and puzzles for the entire family, including such games as YAHTZEE,             
PARCHEESI, AGGRAVATION, JENGA and SCATTERGORIES and PUZZ 3-D, a series of       
three dimensional jigsaw puzzles. Items added within the MILTON BRADLEY brand   
for 1999 include SONNY THE SEAL ring toss game, BALLZERKO, an electronic        
hand-held pinball maze game, and an anniversary edition of CANDY LAND.          

Under the PARKER BROTHERS brand, the Company markets a full line of games   
for families, children and adults. Its classic line of family board games       
includes MONOPOLY, CLUE, SORRY!, RISK, BOGGLE, OUIJA and TRIVIAL PURSUIT,       
some of which have been in the Parker Brothers' line for more than 50 years.    
The Company also markets traditional card games such as MILLE BORNES, ROOK      
and RACK-O, games for adults such as OUTBURST and CATCH PHRASE, a line of       
PLAYSKOOL games for children, as well as a line of puzzles. New under the       
PARKER BROTHERS brand in 1999 will be millennium editions of MONOPOLY and       
TRIVIAL PURSUIT, an updated version of A QUESTION OF SCRUPLES and BOP IT        
EXTREME, a new version of the popular electronic twist-pull game.               

The HASBRO INTERACTIVE line began with CD-ROM games based on the Company's  
traditional games and brands, including MONOPOLY, RISK, SORRY!, BATTLESHIP      
and, for younger children, a series of TONKA titles, including TONKA            
CONSTRUCTION and TONKA GARAGE and CD-ROM playsets which hook onto computer      
keyboards and combine traditional play with computer games. The line now        
includes action games from ATARI and simulation games from MICROPROSE and       
licensed properties such as FROGGER, WHEEL OF FORTUNE and JEOPARDY, many of     
which are also marketed for use on video console systems such as NINTENDO and   
the SONY PLAYSTATION. In 1999, among other more traditional family and          
children's CD-ROM games, HASBRO INTERACTIVE will be launching a line of EM@IL   
GAMES in which two players communicate their moves via e-mail and an EASY-      
BAKE OVEN and a CLUE JR. CD-ROM playset.                                        

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TIGER products are among the most popular hand held electronic games and    
innovation keys its line for 1999. Fueled by the stunning success of FURBY in   
1998, TIGER will be offering a complete line of extensions within this          
category. Included will be FURBY BUDDIES, which are low cost bean bag plush     
toys and the FURBY HAPPY MEAL toys, which will be available both as premiums    
at MCDONALDS and as products for sale at retail. TIGER has also freshened its   
lines with brands like SPORTS FEEL GAMES, WCW PRO POWER games, which feature    
sculpted action figures of real wrestlers with a dot matrix video game built    
in, and a line of NASCAR-themed racing electronic games. Other strong           
licenses which will continue to grow as part of TIGER'S 1999 offerings          
include a comprehensive line of STAR WARS: EPISODE 1 electronic games, WINNIE   
THE POOH electronic learning aids, POKEMON, TELETUBBIES, and, oriented          
towards adults, products based on television game shows including WHEEL OF      
FORTUNE, JEOPARDY, CONCENTRATION and THE PRICE IS RIGHT. Also being             
introduced in 1999 are E YO, TIGER'S introduction into the yo-yo category,      
and a table top tennis game that allows players to compete by playing table     
tennis with a special light as the "ball".                                      

In addition to the United States, the Company operates in more than 25      
countries which sell a representative range of the global brands and products   
marketed in the United States together with some items which are sold only      
internationally. To further extend its range of products, the Company has       
Hong Kong units which market directly to retailers, both in the United States   
and internationally, a line of high quality, low priced toys, games and         
related products, primarily on a direct import basis.                           

In addition, certain products and trademarks are licensed to other          
companies for certain countries and markets where the Company does not          
otherwise have a presence.                                                      

The Company manufactures products in the United States, Mexico, Ireland and 
Spain and sources products, largely through a Hong Kong subsidiary working      
primarily through unrelated manufacturers in various Far East countries.        

Working Capital Requirements                                                
----------------------------                                                
Production has been financed historically by means of short-term borrowings 
which reach peak levels during September through November of each year when     
receivables also generally reach peak levels. The revenue pattern of the        
Company continues to shift with the second half of the year growing in          
significance to its overall business and, within that half, the fourth          
quarter becoming more prominent. The Company expects that this trend will       
continue. The toy business is also characterized by customer order patterns     
which vary from year to year largely because of differences each year in the    
degree of consumer acceptance of a product line, product availability,          
marketing strategies and inventory policies of retailers and differences in     
overall economic conditions. As a result, comparisons of unshipped orders on    

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any date with those at the same date in a prior year are not necessarily        
indicative of sales for that entire given year. Also, quick response            
inventory management practices now being used results in fewer orders being     
placed in advance of shipment and more orders, when placed, for immediate       
delivery. The Company's unshipped orders at February 28, 1999 and March 1,      
1998 were approximately $570,000,000 and $155,000,000, respectively. Also, it   
is a general industry practice that orders are subject to amendment or          
cancellation by customers prior to shipment. The backlog at any date in a       
given year can be affected by programs the Company may employ to induce its     
customers to place orders and accept shipments early in the year. This method   
is a general industry practice. The programs the Company is employing to        
promote sales in 1999 are not substantially different from those employed in    
1998.                                                                           

As part of the traditional marketing strategies of the toy industry, many   
sales made early in the year are not due for payment until the fourth quarter   
or early in the first quarter of the subsequent year, thus making it            
necessary for the Company to borrow significant amounts pending these           
collections. During the year, the Company relies on internally generated        
funds and short-term borrowing arrangements, including commercial paper, to     
finance its working capital needs. Currently, the Company has available to it   
unsecured lines of credit, which it believes are adequate, of approximately     
$1,000,000,000 including a $350,000,000 long-term and a $150,000,000 short-     
term revolving credit agreement with a group of banks which is also used as a   
back-up to commercial paper issued by the Company.                              

Royalties, Research and Development                                         
-----------------------------------                                         
The Company's business is based to a substantial extent on the continuing   
development of new products and the redesigning of existing items for           
continuing market acceptance. In 1998, 1997 and 1996, approximately             
$184,962,000, $154,710,000 and $152,487,000, respectively, were incurred on     
activities relating to the development, design and engineering of new           
products and their packaging (including items brought to the Company by         
independent designers) and to the improvement or modification of ongoing        
products. Much of this work is performed by the Company's staff of designers,   
artists, model makers and engineers.                                            

In addition to its own staff, the Company deals with a number of            
independent toy designers for whose designs and ideas the Company competes      
with other toy manufacturers. Rights to such designs and ideas, when acquired   
by the Company, are usually exclusive under agreements requiring the Company    
to pay the designer a royalty on the Company's net sales of the item. These     
designer royalty agreements in some cases provide for advance royalties and     
minimum guarantees.                                                             

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The Company also produces a number of toys under trademarks and copyrights  
utilizing the names or likenesses of familiar movie, television and comic       
strip characters, for whose rights the Company competes with other toy          
manufacturers. Licensing fees are generally paid as a royalty on the            
Company's net sales of the item. Licenses for the use of characters are         
generally exclusive for specific products or product lines in specified         
territories. In many instances, advance royalties and minimum guarantees are    
required by character license agreements. Under terms of currently existing     
agreements, in certain circumstances the Company may be required to pay an      
aggregate of up to $660,000,000 in guaranteed or minimum royalties between      
1998 and 2007. Of this amount, in excess of $110,000,000 has been paid and is   
included in the $145,066,000 of prepaid royalties which are a component of      
prepaid expenses and other current assets on the balance sheet. Of the          
remaining amount, Hasbro may be required to pay approximately $250,000,000,     
$120,000,000 and $120,000,000 in 1999, 2002 and 2005, respectively. Such        
payments are related to royalties which are expected to be incurred on          
anticipated revenues in the years 1999 through 2007.                            

Marketing and Sales                                                         
-------------------                                                         
The Company's products are sold nationally and internationally to a broad   
spectrum of customers including wholesalers, distributors, chain stores,        
discount stores, mail order houses, catalog stores, department stores and       
other retailers, large and small. The Company and its subsidiaries employ       
their own sales forces which account for nearly all of the sales of their       
products. Remaining sales are generated by independent distributors who sell    
the Company's products principally in areas of the world where the Company      
does not otherwise maintain a presence. The Company maintains showrooms in      
New York and selected other major cities world-wide as well as at most of its   
subsidiary locations. Although the Company has more than 2,000 customers in     
the United States and Canada, most of which are wholesalers, distributors or    
large chain stores, there has been significant consolidation at the retail      
level over the last several years. In other countries, the Company has in       
excess of 20,000 customers, many of which are individual retail stores.         
During 1998, sales to the Company's two largest customers, Wal-Mart Stores,     
Inc. and Toys `R Us, Inc., represented 18% and 17%, respectively, of            
consolidated net revenues.                                                      

The Company advertises many of its toy and game products extensively on     
television. The Company generally advertises selected items in its product      
groups in a manner designed to promote the sale of other specific items in      
those product groups. Each year, the Company introduces its new products in     
New York City at the time of the American International Toy Fair in February.   
It also introduces some of its products to major customers during the prior     
year.                                                                           

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In 1998, the Company spent approximately $440,692,000 in advertising,       
promotion and marketing programs compared to $411,574,000 in 1997 and           
$418,003,000 in 1996.                                                           

Manufacturing and Importing                                                     
---------------------------                                                 
As a result of the global integration and profit enhancement program        
announced in December 1997, the Company manufactures its products in four       
principal facilities, East Longmeadow, Massachusetts, Waterford, Ireland,       
Tijuana, Mexico and Valencia, Spain. Most of its products are manufactured      
from basic raw materials such as plastic and cardboard, although certain        
products also make use of electronics components. All of these materials are    
readily available but may be subject to significant fluctuations in price.      
The Company's manufacturing process includes injection molding, blow molding,   
metal stamping, spray painting, printing, box making and assembly. The          
Company purchases certain components and accessories used in its toys and       
games and some finished items from United States manufacturers as well as       
from manufacturers in the Far East, which is the largest manufacturing center   
of toys in the world, and other countries. The 1996 implementation of the       
General Agreement on Tariffs and Trade reduced or eliminated customs duties     
on many products imported by the Company. The Company believes that the         
manufacturing capacity of its facilities and the supply of components,          
accessories and completed products which it purchases from unaffiliated         
manufacturers is adequate to meet the foreseeable demand for the products       
which it markets. The Company's reliance on external sources of manufacturing   
can be shifted, over a period of time, to alternative sources of supply for     
products it sells, should such changes be necessary.                            

However, if the Company is prevented from obtaining products from a         
substantial number of its current Far East suppliers due to political, labor    
or other factors beyond its control, the Company's operations would be          
disrupted while alternative sources of product were secured. The imposition     
of trade sanctions by the United States or the European Union against a class   
of products imported by the Company from, or the loss of "most favored          
nation" trading status by, the People's Republic of China could significantly   
increase the cost of the Company's products imported into the United States     
or Europe from China.                                                           

The Company makes its own tools and fixtures but purchases dies and molds   
principally from independent United States and international sources. Several   
of the Company's North American production departments operate on a two-shift   
basis and its molding departments operate on a continuous basis through most    
of the year.                                                                    

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Competition                                                                 
-----------                                                                 
The Company's business is highly competitive and it competes with several   
large and many small United States and international manufacturers. The         
Company is a worldwide leader in the design, manufacture and marketing of       
toys and games.                                                                 

Employees                                                                   
---------                                                                   
The Company employs approximately 10,000 persons worldwide, approximately   
6,000 of whom are located in the United States.                                 

Trademarks, Copyrights and Patents                                          
----------------------------------                                          
The Company's products are protected, for the most part and in as many      
countries as practical, by registered trademarks, copyrights and patents to     
the extent that such protection is available and meaningful. The loss of such   
rights concerning any particular product would not have a material adverse      
effect on the Company's business, although the loss of such protection for a    
number of significant items might have such an effect.                          

Government Regulation                                                       
---------------------                                                       
The Company's toy products sold in the United States are subject to the     
provisions of the Consumer Product Safety Act (the "CPSA"), The Federal         
Hazardous Substances Act (the "FHSA") and the regulations promulgated           
thereunder. The CPSA empowers the Consumer Product Safety Commission (the       
"CPSC") to take action against hazards presented by consumer products,          
including the formulation and implementation of regulations and uniform         
safety standards. The CPSC has the authority to seek to declare a product "a    
banned hazardous substance" under the CPSA and to ban it from commerce. The     
CPSC can file an action to seize and condemn an "imminently hazardous           
consumer product" under the CPSA and may also order equitable remedies such     
as recall, replacement, repair or refund for the product. The FHSA provides     
for the repurchase by the manufacturer of articles which are banned. Similar    
laws exist in some states and cities within the United States and in Canada,    
Australia and Europe. The Company maintains laboratories which have testing     
and other procedures intended to maintain compliance with the CPSA and FHSA.    

Notwithstanding the foregoing, there can be no assurance that all of the    
Company's products are or will be hazard free. Any material product recall      
could have an effect on the Company, depending on the product, and could        
affect sales of other products.                                                 

During 1998, the CPSC released the results of a study of a chemical,        
diisononyl phthalate ("DINP") used to soften some plastic toys and children's   
products.  The study concluded that few if any children are at risk from DINP   

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because the amount that they ingest does not even come close to a harmful       
level.  Therefore, the CPSC staff did not recommend a ban on these products.    
However, the CPSC indicated that the study identified several areas of          
uncertainty where additional scientific research is needed.  As a precaution    
while more scientific work is done, the CPSC staff requested the industry to    
remove DINP from soft rattles and teethers.  Approximately 90% of               
manufacturers, including the Company, indicated to the CPSC that they have or   
will remove DINP from the soft rattles and teethers by early 1999. Canada and   
certain European countries have requested or required similar removal of DINP   
from products meant to be mouthed by children. The Company does not believe     
such removal will materially affect the Company.                                

The Children's Television Act of 1990 and the rules promulgated thereunder  
by the United States Federal Communications Commission as well as the laws of   
certain countries place certain limitations on television commercials during    
children's programming.                                                         

The Company maintains programs to comply with various United States         
federal, state, local and international requirements relating to the            
environment, plant safety and other matters.                                    

Toys "R" Us Litigation                                                      
----------------------                                                      
On September 25, 1997, an administrative law judge ("ALJ") of the Federal   
Trade Commission (the "Commission") issued an Initial Decision against Toys     
"R" Us, finding that Toys "R" Us had engaged in unfair business practices in    
violation of Section 5 of the Federal Trade Commission Act. In particular,      
the ALJ found that Toys "R" Us entered into vertical agreements with, and       
facilitated horizontal agreements among, various toy manufacturers, including   
the Company, to restrict the supply of certain toys to warehouse club           
retailers. Although the Company voluntarily produced documents and witnesses    
in the action, the Company was not named a defendant by the Commission in the   
action. The ALJ's decision was affirmed by the Commission on October 14,        
1998.                                                                           

In the wake of the ALJ's decision, numerous antitrust actions were filed    
naming Toys "R" Us, the Company, and certain other toy manufacturers as         
defendants. All of these actions generally allege that Toys "R" Us              
orchestrated an illegal conspiracy with various toy manufacturers to            
improperly cut-off supplies of popular toys to the warehouse clubs and other    
low margin retailers that compete with Toys "R" Us. The Company was named as    
a defendant in twenty-seven private antitrust class actions in federal courts   
in California, Illinois, Maryland, New Jersey, New York, Pennsylvania and       
Vermont, all of which purport to represent nationwide classes of customers.     
These actions allege, among other things, violations of the Sherman and         
Clayton Acts. In addition, on October 2, 1997, the Attorney General of the      
State of New York ("NYAG") filed an action against Toys "R" Us, the Company,    

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and several other toy manufacturers alleging violations of federal and state    
antitrust law, on behalf of all persons in the State of New York who            
purchased toy products from retailers from 1989 to the present. The NYAG        
complaint was amended to add as plaintiffs attorneys general from an            
additional forty-three states, the District of Columbia and the Commonwealth    
of Puerto Rico.                                                                 

On February 11, 1998, the Judicial Panel on Multi-District Litigation       
consolidated and transferred, for all pretrial proceedings, the NYAG action     
and all of the pending private actions in the federal courts. The               
consolidated cases are titled In Re Toys "R" Us Antitrust Litigation, MDL-      
1211 and are pending in the Federal District Court in the Eastern District of   
New York.                                                                       

In addition, the Company was named as a defendant, along with Toys "R" Us   
and certain other toy manufacturers, in an action titled Struthers v. Toys      
"R" Us et al., No. H198813-6, filed in the Superior Court for the State of      
California, Alameda County, alleging violations of state antitrust laws. On     
February 9, 1998, the Superior Court ordered the Struthers case to be           
coordinated with three pending state court actions previously filed against     
Toys "R" Us in California. All of the California litigations were stayed to     
encourage the parties to pursue settlement discussions and negotiations in      
good faith. These discussions were coordinated with a mediation ordered in a    
case titled Wilson v. Toys "R" Us, Case No. CV96-574, pending in Tuscaloosa     
County Circuit Court in Alabama. The Company is not a party to the Alabama      
case.                                                                           

All of the foregoing complaints seek injunctive relief, unspecified treble  
damages, expenses or costs and attorneys fees. The Company has not responded    
to the complaints in any of these actions.                                      

On December 9, 1998, Hasbro entered into a Settlement Agreement and Release 
with the State Attorneys General and the Private Plaintiffs with respect to     
all of the pending state and federal actions. The parties are currently in      
the process of presenting the Settlement to the District Court for              
preliminary approval. Following this process, the Company anticipates that      
notice of the Settlement will be sent to potential class members, and           
thereafter the Settlement will be presented to the Court for final approval.    
No dates for these hearings have been scheduled.                                

Forward-Looking Information                                                 
---------------------------                                                 
From time to time, the Company may publish forward-looking statements       
relating to such matters as anticipated financial performance, business         
prospects, technological developments, new products, research and development   
activities and similar matters. Forward-looking statements are inherently       
subject to risks and uncertainties, many of which are known by, or self-        

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evident to, the investing public. The Private Securities Litigation Reform      
Act of 1995 provides a safe harbor for forward-looking statements. In order     
to comply with the terms of the safe harbor, the Company notes that a variety   
of factors could cause its actual results and experience to differ materially   
from the anticipated results or other expectations expressed in its forward-    
looking statements. The risks and uncertainties that may affect the             
operations, performance, development and results of Hasbro's business include   
the following:                                                                  

1)  The Company's dependence on its timely development and introduction of
new products and the acceptance, in a competitive product environment, by       
both the customer and consumer, of new and continuing products;                 

2)  The impact of competition on revenue, margins and other aspects of the
Company's business;                                                             

3)  Economic conditions and currency fluctuations in the various markets  
in which the Company operates throughout the world, including the effect of     
currency fluctuations on reportable income;                                     

4)  The inventory policies of retailers, including the continuing trend of
increased concentration of Hasbro's revenues in the second half and fourth      
quarter of the year, together with the increased reliance by retailers on       
quick response inventory management practices, which increases the risk of      
the Company's underproduction of popular items, overproduction of less          
popular items and failure to achieve tight and compressed shipping schedules;   

5)  The impact of Year 2000 issues, including the Company's incurring     
higher than expected costs to achieve, or not achieving, Year 2000 readiness    
with respect to its systems, or its customers, vendors or service providers     
failing to achieve such readiness; unanticipated technical malfunctions or      
difficulties which would arise during the validation process or otherwise;      
the inherent risk that assurances, warranties, and specifications provided by   
third parties with respect to the Company's systems, or such third party's      
Year 2000 readiness, may prove to be inaccurate, despite the Company's review   
process; the continued availability of qualified persons to carry out the       
remaining anticipated phases; the risk that governments may not be Year 2000    
ready, which could affect the commercial sector in trade, finance and other     
areas, notwithstanding private sector Year 2000 readiness; whether, despite a   
comprehensive review, the Company has successfully identified all Year 2000     
issues and risks; and the risk that proposed actions and contingency plans of   
the Company and third parties with respect to Year 2000 issues may conflict     
or themselves give rise to additional issues;                                   

6)  The risk that anticipated benefits of acquisitions and the Company's  
global integration and profit enhancement program may not occur or be delayed   
or reduced in their realization; and                                            

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7)  Other risks and uncertainties as are or may be detailed from time to  
time in Hasbro's public announcements and filings with the Securities and       
Exchange Commission.                                                            

(c) Financial Information About International and United States             
-----------------------------------------------------------         
Operations and Export Sales                                       
---------------------------                                       
The information required by this item is included in note 16 of Notes to    
Consolidated Financial Statements in Exhibit 13 to this Report and is           
incorporated herein by reference.                                               

ITEM  2.  PROPERTIES                                                            
----------                                                  
                                                             Lease
                                          Square   Type of    Expiration
Location             Use                       Feet   Possession    Dates       
--------             ---                      ------  ----------  ----------    

Rhode Island                                                                    
------------                                                                    
Pawtucket           Administrative, Sales                                     
& Marketing Offices &               
              Product Development    343,000     Owned        --
Pawtucket           Executive Office         23,000     Owned        --       
East Providence     Administrative Office   120,000     Leased      1999      

California                                                                      
----------                                                                      
Ontario             Warehouse               432,000     Leased      2002      
Napa                Office & Warehouse      400,000     Leased      2013      
South San Francisco Office                   69,000     Owned        --       
Alameda             Product Development      38,400     Leased      2002      

Illinois                                                                        
--------                                                                        
Vernon Hills        Office & Warehouse       21,000     Leased      2002      

Massachusetts                                                                   
-------------                                                                   
East Longmeadow     Office, Manufacturing                                     
              & Warehouse          1,147,500     Owned        --
East Longmeadow     Warehouse               500,000     Leased      2000      
Beverly             Office                  100,000     Owned        --       

Maryland                                                                        
--------                                                                        
Hunt Valley         Product Development      29,900     Leased      2003      

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New Jersey                                                                      
----------                                                                      
Northvale           Warehouse                75,000     Leased      2002      
Mt. Laurel          Office                   11,000     Leased      1999      

New York                                                                        
--------                                                                        
New York            Office & Showroom        70,300     Leased      2011      
New York            Offices & Showrooms      32,300     Leased      1999      
New York            Office & Showroom        17,200     Leased      2006      

Ohio                                                                            
----                                                                            
Bedford Heights     Office and warehouse    187,100     Leased      2000      
Cincinnati          Office                  174,000     Leased      2007      
Cincinnati          Warehouse                31,800     Leased      2008      

Texas                                                                           
-----                                                                           
El Paso             Warehouse             1,000,000     Leased      2008      

Australia                                                                       
---------                                                                       
Lidcombe            Office & Warehouse      161,400     Leased      2002      
Eastwood            Office                   16,900     Leased      2001      

Argentina                                                                       
---------                                                                       
Buenos Aires        Office and Warehouse     54,000     Leased      2000      

Austria                                                                         
-------                                                                         
Vienna              Office                    4,000     Leased      1999      

Belgium                                                                         
-------                                                                         
Brussels            Office & Showroom        20,700     Leased      1999      

Canada                                                                          
------                                                                          
Montreal            Office, Warehouse                                         
               & Showroom             133,900     Leased      2001
Mississauga         Sales Office & Showroom  16,300     Leased      2004      
Montreal            Warehouse                88,100     Leased      2001      

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Chile                                                                           
-----                                                                           
Santiago            Warehouse                23,800     Leased      2000      
Santiago            Office                    3,500     Leased      2000      

Denmark                                                                         
-------                                                                         
Glostrup            Office                    9,200     Leased      1999      

England                                                                         
-------                                                                         
Uxbridge            Office & Showroom        94,500     Leased      2013      
Gloucestershire     Office                   28,700     Leased      1999      

France                                                                          
------                                                                          
Le Bourget du Lac   Office & Warehouse      108,300     Owned        --       
Savoie Technolac    Office                   33,500     Owned        --       
Creutzwald          Warehouse               217,200     Owned        --       
Creutzwald          Warehouse                30,700     Leased      1999      
Gresy               Warehouse                24,500     Leased      1999      

Germany                                                                         
-------                                                                         
Dietzenbach         Office                   39,400     Leased      1999      
Soest               Office & Warehouse      164,200     Owned        --       
Boner               Office & Warehouse      111,300     Owned        --       

Greece                                                                          
------                                                                          
Athens              Office & Warehouse       25,100     Leased      2007      

Hong Kong                                                                       
---------                                                                       
Kowloon             Offices                  20,000     Leased      1999      
Kowloon             Offices                  73,400     Leased      2000      
New Territories     Office & Warehouse       17,800     Leased      1999      
Kowloon             Warehouses               11,300     Leased      2000      
New Territories     Warehouse                11,500     Leased      2000      

Hungary                                                                         
-------                                                                         
Budapest            Office                    6,300     Leased      1999      

Ireland                                                                         
-------                                                                         
Waterford           Office, Manufacturing                                     
              & Warehouse            244,400     Owned        --

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Italy                                                                           
-----                                                                           
Milan               Office & Showroom        12,100     Leased      2002      

Malaysia                                                                        
-------                                                                         
Selangor                                                                      
Darul Ehsan        Office                    4,900     Leased      2000     

Mexico                                                                          
------                                                                          
Tijuana             Office, Manufacturing                                     
               & Warehouse            143,800     Leased      1999
Tijuana             Manufacturing &                                           
               Warehouse              205,000     Leased      1999
Tijuana             Warehouse                48,600     Leased      1999      
Tijuana             Warehouse                46,900     Leased      1999      
Periferico          Office                   16,100     Leased      2001      
Venados             Warehouses              118,100     Leased      1999      

The Netherlands                                                                 
---------------                                                                 
Ter Apel            Office & Warehouse      139,300     Owned        --       
Ter Apel            Warehouse                79,400     Leased      1999      
Utrecht             Office                   17,000     Leased      2003      

New Zealand                                                                     
-----------                                                                     
Auckland            Office & Warehouse      110,900     Leased      2005      

Norway                                                                          
------                                                                          
Asker               Office                    5,900     Leased      1999      

Peru                                                                            
----                                                                            
Lima                Warehouse                32,400     Leased      1999      
Lima                Office                   11,000     Leased      1999      

Poland                                                                          
------                                                                          
Warsaw              Office & Warehouse       14,300     Leased      2000      

Portugal                                                                        
--------                                                                        
Estoril-Lisboa      Office                    2,900     Leased      2003      

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Singapore                                                                       
---------                                                                       
Singapore           Office & Warehouse        9,300     Leased      2000      

Spain                                                                           
-----                                                                           
Valencia            Office, Manufacturing                                     
               & Warehouse            115,100     Leased      1999
Valencia            Office                   27,600     Leased      2011      
Valencia            Manufacturing                                             
               & Warehouse            201,900     Leased      2011
Valencia            Warehouse                48,100     Leased      1999      
Valencia            Warehouse               161,700     Leased      2002      

Sweden                                                                          
------                                                                          
Vosby               Office                    7,400     Leased      1999      

Switzerland                                                                     
-----------                                                                     
Berikon             Office & Warehouse       25,000     Leased      1999      
Delemont            Office                    9,200     Leased      2004      

Taiwan                                                                          
------                                                                          
TPE County          Warehouse                14,400     Leased      1999      

Wales                                                                           
-----                                                                           
Newport             Warehouse                72,000     Leased      2003      
Newport             Warehouse               198,000     Owned        --       

In addition to the above listed facilities, the Company either owns or      
leases various other properties approximating 450,000 square feet which are     
utilized in its operations. The Company also either owns or leases an           
aggregate of approximately 2,100,000 square feet not currently being utilized   
in its operations, approximately 1,300,000 of which results from the            
Company's global integration and profit enhancement program implemented         
during 1998. Most of these properties are being leased, subleased or offered    
for sublease or sale.                                                           

The foregoing properties consist, in general, of brick, cinder block or     
concrete block buildings which the Company believes are in good condition and   
well maintained.                                                                

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ITEM  3.  LEGAL PROCEEDINGS                                                     
-----------------                                           
The Company is party to certain legal proceedings, substantially involving  
routine litigation incidental to the Company's business, none of which,         
individually or in the aggregate, is deemed to be material to the financial     
condition of the Company. For a description of the "Toys `R' Us litigation",    
see Item 1.                                                                     

ITEM  4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS                   
---------------------------------------------------         
None.                                                                       

EXECUTIVE OFFICERS OF THE REGISTRANT                                            
------------------------------------                                            
The following persons are the executive officers of the Company and its     
subsidiaries and divisions. Such executive officers are elected annually. The   
position and office listed below are the principal position(s) and office(s)    
held by such person with the Company, subsidiary or divisions employing such    
person. The persons listed below generally also serve as officers and           
directors of the Company's various subsidiaries at the request and              
convenience of the Company.                                                     

                                                      Period
                                                          Serving in
                                                       Current
Name                         Age  Position and Office Held      Position        
----                         ---  ------------------------      ----------      
Alan G. Hassenfeld (1)       50  Chairman of the Board and                      
                           Chief Executive Officer        Since 1999

Herbert M. Baum (2)          62  President and Chief                            
                           Operating Officer              Since 1999

Harold P. Gordon (3)         61  Vice Chairman                  Since 1995      

John T. O'Neill              54  Executive Vice President and                   
                           Chief Financial Officer        Since 1989

Alfred J. Verrecchia (4)     56  Executive Vice President,                      
       Global Operations and
                           Development                    Since 1999

Virginia H. Kent (5)         44  Senior Vice President and                      
                           Sector Head, Toys              Since 1999

E. David Wilson (6)          61  Senior Vice President and                      
                           Sector Head, Games             Since 1999

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George B. Volanakis (7)      51  Senior Vice President and                      
            Sector Head, International
                           Businesses                     Since 1999

Richard B. Holt              57  Senior Vice President and                      
                           Controller                     Since 1992

Cynthia S. Reed (8)          43  Senior Vice President and                      
                           General Counsel                Since 1995

Douglas J. Schwinn (9)       48  Senior Vice President and                      
                           Chief Information Officer      Since 1999

Martin R. Trueb (10)         47  Senior Vice President and                      
                           Treasurer                      Since 1997

Phillip H. Waldoks (11)      46  Senior Vice President -                        
         Corporate Legal Affairs
                           and Secretary                  Since 1995

(1)  Prior thereto, Chairman of the Board, President and Chief Executive    
Officer.                                                          

(2)  Prior thereto, President and Chief Executive Officer, Quaker State     
Corporation.                                                      

(3)  Prior thereto, Partner, Stikeman, Elliott (law firm).                  

(4)  Prior thereto, Executive Vice President and President, Global          
   Operations from 1996 to 1999; prior thereto, Chief Operating Officer,
Domestic Toy Operations.                                          

(5)  Prior thereto, President, Brands and Product Development from 1996     
to 1999; prior thereto, General Manager, Girls/Boys/Nerf.         

(6)  Prior thereto, President, Hasbro Americas from 1996 to 1999; prior     
thereto, President, Hasbro Games Group, from 1995 to 1996; prior  
thereto, President, Milton Bradley.                               

(7)  Prior thereto, President, European Sales and Marketing from 1998 to    
  1999; prior thereto, President and Chief Executive Officer, The Ertl
Company, Inc.                                                     

(8)  Prior thereto, Vice President - Legal.                                 

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(9)  Prior thereto, Senior Vice President and Chief Information Officer,    
OfficeMax, Inc., from 1997 to 1999; prior thereto, Senior Vice    
President, Information Services and Chief Information Officer,    
FoxMeyer Drug Company from 1995 to 1997; prior thereto, Vice      
President, Software Development, FoxMeyer Drug Company.           

(10)  Prior thereto, Assistant Treasurer, Amway Corporation, from 1995        
to 1997; prior thereto, Director, International Treasury,         
RJR Nabisco, Inc.                                                 

(11)  Prior thereto, Senior Vice President - Corporate Legal Affairs.         

PART II 

ITEM  5.  MARKET FOR THE REGISTRANT'S COMMON EQUITY AND RELATED                 
-----------------------------------------------------       
STOCKHOLDER MATTERS                                       
-------------------                                       
On October 30, 1998, the Company issued an aggregate of 6,000,000 warrants  
to purchase 6,000,000 shares of common stock, par value $.50 per share, of      
the Company, at an exercise price of $23.3333 per share(as adjusted for the     
three-for-two stock split paid in the form of a 50% stock dividend on March     
15, 1999), subject to anti-dilution adjustment in certain events, to            
Lucasfilm Ltd. and its subsidiary Lucas Licensing Ltd., in connection with,     
and as partial consideration for, the acquisition of certain long-term          
rights. The warrants were issued without registration under the Securities      
Act of 1933 (the "Act") on the basis of Section 4(2) of the Act in reliance     
upon the representations of each warrant holder that it is an accredited        
investor, as defined in Rule 501 of Regulation D under the Act, and that it     
is acquiring the warrants for investment purposes only and not with a view      
to, or for resale in connection with, any "distribution" thereof for purposes   
of the Act.  The warrants are not exercisable prior to the theatrical release   
in the United States of Star Wars: Episode 1: The Phantom Menace, which is      
expected to take place on May 19, 1999, except that exercisability would be     
accelerated on a change in control of the Company. The warrants would remain    
exercisable, with respect to 3,600,000 warrants until October 30, 2009 and      
with respect to 2,400,000 warrants until October 30, 2010.                      

The remainder of the information required by this item is included in       
Market for the Registrant's Common Equity and Related Stockholder Matters in    
Exhibit 13 to this Report and is incorporated herein by reference.              

ITEM  6.  SELECTED FINANCIAL DATA                                               
-----------------------                                     
The information required by this item is included in Selected Financial     
Data in Exhibit 13 to this Report and is incorporated herein by reference.      

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ITEM  7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION           
----------------------------------------------------------- 
AND RESULTS OF OPERATIONS                                 
-------------------------                                 
The information required by this item is included in Management's Review in 
Exhibit 13 to this Report and is incorporated herein by reference.              

ITEM  8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA                           
-------------------------------------------                 
The information required by this item is included in Financial Statements   
and Supplementary Data in Exhibit 13 to this Report and is incorporated         
herein by reference.                                                            

ITEM  9.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING           
----------------------------------------------------------- 
AND FINANCIAL DISCLOSURE                                  
------------------------                                  
None.                                                                       

PART III

ITEMS 10, 11, 12 and 13.                                                        

The information required by these items is included in registrant's         
definitive proxy statement for the 1999 Annual Meeting of Shareholders and is   
incorporated herein by reference, except that the sections under the headings   
(a) "Comparison of Five Year Cumulative Total Shareholder Return Among          
Hasbro, S&P 500 and Russell 1000 Consumer Discretionary Economic Sector" and    
accompanying material and (b) "Report of the Compensation and Stock Option      
Committee of the Board of Directors" in the definitive proxy statement shall    
not be deemed "filed" with the Securities and Exchange Commission or subject    
to Section 18 of the Securities Exchange Act of 1934.                           

PART IV 

ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K        
 ---------------------------------------------------------------
(a) Financial Statements, Financial Statement Schedules and Exhibits        
----------------------------------------------------------------    
(1)  Financial Statements                                               
--------------------                                          
Included in PART II of this report:                       
Independent Auditors' Report                          

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Consolidated Balance Sheets at December 27, 1998 and  
December 28, 1997                                   

  Consolidated Statements of Earnings for the Three Fiscal
Years Ended in December 1998, 1997 and 1996         

 Consolidated Statements of Shareholders' Equity for the
    Three Fiscal Years Ended in December 1998, 1997 and 1996

Consolidated Statements of Cash Flows for the Three   
Fiscal Years Ended in December 1998, 1997 and 1996  

Notes to Consolidated Financial Statements            

(2)  Financial Statement Schedules                                      
-----------------------------                                 
Included in PART IV of this Report:                       
Report of Independent Certified Public Accountants    
on Financial Statement Schedule                     

 For the Three Fiscal Years Ended in December 1998, 1997
and 1996:                                           
 Schedule II - Valuation and Qualifying Accounts and
Reserves            

Schedules other than those listed above are omitted for the reason that they    
are not required or are not applicable, or the required information is shown    
in the financial statements or notes thereto. Columns omitted from schedules    
filed have been omitted because the information is not applicable.              

(3)   Exhibits                                                          
--------                                                    
The Company will furnish to any shareholder, upon written request, any      
exhibit listed below upon payment by such shareholder to the Company of the     
Company's reasonable expenses in furnishing such exhibit.                       

Exhibit                                                                         
-------                                                                         
3.  Articles of Incorporation and Bylaws                                
(a)  Restated Articles of Incorporation of the Company.       
(Incorporated by reference to Exhibit (c)(2) to the 
Company's Current Report on Form 8-K, dated July 15,
1993, File No. 1-6682.)                             

   (b)  Amended and Restated Bylaws of the Company. (Incorporated by
       reference to Exhibit (3) to the Company's Current Report on
Form 8-K, dated February 16, 1996, File No. 1-6682.)

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4.  Instruments defining the rights of security holders, including      
indentures.                                                     
(a)  Indenture, dated as of July 17, 1998, by and between the 
   Company and Citibank, N.A. as Trustee. (Incorporated by
       reference to Exhibit 4.1 to the Company's Current Report on
Form 8-K dated July 14, 1998, File No. 1-6682.)     

10.  Material Contracts                                                   
(a)  Lease between Hasbro Canada Inc. (formerly named Hasbro  
       Industries (Canada) Ltd.) and Central Toy Manufacturing Co.
      ("Central Toy"), dated December 23, 1976. (Incorporated by
    reference to Exhibit 10.15 to the Company's Registration
Statement on Form S-14, File No. 2-92550.)          

 (b)  Lease between Hasbro Canada Inc. and Central Toy, together
   with an Addendum thereto, each dated as of May 1, 1987.
        (Incorporated by reference to Exhibit 10(f) to the Company's
Annual Report on Form 10-K for the Fiscal Year Ended
December 27, 1987, File No. 1-6682.)                

    (c)  Addendum to lease, dated March 5, 1998, between Hasbro Canada
        and Central Toy. (Incorporated by reference to Exhibit 10(c)
      to the Company's Annual Report on Form 10-K for the Fiscal
Year Ended December 28, 1997, File No. 1-6682.)     

  (d) Toy License Agreement between Lucas Licensing Ltd. and the
    Company, dated as of October 14, 1997. (Portions of this
 agreement have been omitted pursuant to a request for
     confidential treatment under Rule 24b-2 of the Securities
Exchange Act of 1934, as amended.)                  

(e)  First Amendment to Toy License Agreement between Lucas   
           Licensing Ltd. and the Company, dated as of September 25, 1998.
        (Portions of this  agreement have been omitted pursuant to a
      request for confidential treatment under Rule 24b-2 of the
Securities Exchange Act of 1934, as amended.)       

     (f)  Agreement of Strategic Relationship between Lucasfilm Ltd. and
       the Company dated as of October 14, 1997. (Portions of this
 agreement have been omitted pursuant to a request for
     confidential treatment under Rule 24b-2 of the Securities
Exchange Act of 1934, as amended.)                  

     (g)  First Amendment to Agreement of Strategic Relationship between
           Lucasfilm Ltd. and the Company, dated as of September 25, 1998.

(h)  Warrant, dated October 14, 1997 between the Company and  
Lucas Licensing Ltd.                                

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(i)  Warrant, dated October 14, 1997 between the Company and  
Lucasfilm Ltd.                                      

(j)  Warrant, dated October 30, 1998 between the Company and  
Lucas Licensing Ltd.                                

(k)  Warrant, dated October 30, 1998 between the Company and  
Lucasfilm Ltd.                                      

(l)  Asset Purchase Agreement dated as of February 8, 1998,   
       together with Amendment thereto dated as of March 31, 1998,
      by and among the Company, Tiger Electronics Ltd. (formerly
   named HIAC X Corp. and a wholly-owned subsidiary of the
    Company), Tiger Electronics, Inc. and certain affiliates
        thereof and Owen Randall Rissman and the Rissman Family 1997
    Trust. (Incorporated by reference to Exhibit 2(a) to the
      Company's Current Report on Form 8-K, dated April 1, 1998,
File No. 1-6682.)                                   

Executive Compensation Plans and Arrangements                   
(m)  Employee Incentive Stock Option Plan. (Incorporated by   
   reference to  Exhibit 4.1 to the Company's Registration
Statement on Form S-8, File No. 2-78018.)           

(n)  Amendment No. 1 to Employee Incentive Stock Option Plan. 
        (Incorporated by reference to Exhibit 10(l) to the Company's
 Annual  Report on Form 10-K for the Fiscal Year Ended
December 28, 1986, File No. 1-6682.)                

(o)  Amendment No. 2 to Employee Incentive Stock Option Plan. 
        (Incorporated by reference to Exhibit 10(n) to the Company's
 Annual  Report on Form 10-K for the Fiscal Year Ended
December 27, 1987, File No. 1-6682.)                

(p)  Amendment No. 3 to Employee Incentive Stock Option Plan. 
        (Incorporated by reference to Exhibit 10(o) to the Company's
Annual Report on Form 10-K for the Fiscal Year Ended
December 25, 1988, File No. 1-6682.)                

(q)  Amendment No. 4 to Employee Incentive Stock Option Plan. 
        (Incorporated by reference to Exhibit 10(s) to the Company's
Annual Report on Form 10-K for the Fiscal Year Ended
December 31, 1989, File No. 1-6682.)                

(r)  Form of Non Qualified Stock Option Agreement under the   
  Employee Incentive Stock Option Plan. (Incorporated by
     reference to Exhibit 10(q) to the Company's Annual Report
     on Form 10-K for the Fiscal Year Ended December 25, 1988,
File No. 1-6682.)                                   

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  (s)  Non Qualified Stock Option Plan. (Incorporated by reference
       to Exhibit 10.10 to the Company's Registration Statement on
Form S-14, File No. 2-92550.)                       

(t)  Amendment No. 1 to Non Qualified Stock Option Plan.      
(Incorporated by reference to Exhibit 10(j) to the  
Company's Annual Report on Form 10-K for the Fiscal 
Year Ended December 28, 1986, File No. 1-6682.)     

(u)  Amendment No. 2 to Non Qualified Stock Option Plan.      
     (Incorporated by reference to Appendix A to the Company's
     definitive proxy statement for its 1987 Annual Meeting of
Shareholders, File No. 1-6682.)                     

(v)  Amendment No. 3 to Non Qualified Stock Option Plan.      
        (Incorporated by reference to Exhibit 10(l) to the Company's
Annual Report on Form 10-K for the Fiscal Year Ended
December 31, 1989, File No. 1-6682.)                

   (w)  Form of Stock Option Agreement (For Employees) under the Non
      Qualified Stock Option Plan. (Incorporated by reference to
     Exhibit 10(t) to the Company's Annual Report on Form 10-K
 for the Fiscal Year Ended December 27, 1992, File No.
1-6682.)                                            

(x)  1992 Stock Incentive Plan. (Incorporated by reference to 
      Appendix A to the Company's definitive proxy statement for
      its 1992 Annual Meeting of Shareholders, File No. 1-6682.)

    (y)  Form of Stock Option Agreement under the 1992 Stock Incentive
       Plan, the Stock Incentive Performance Plan and the Employee
   Non-Qualified Stock Plan. (Incorporated by reference to
         Exhibit 10(v) to the Company's Annual Report on Form 10-K for
      the Fiscal Year Ended December 27, 1992, File No. 1-6682.)

   (z)  Hasbro, Inc. Stock Incentive Performance Plan. (Incorporated
        by reference to Appendix A to the Company's definitive proxy
       statement for its 1995 Annual Meeting of Shareholders, File
No. 1-6682.)                                        

   (aa)  Employee Non-Qualified Stock Plan. (Incorporated by reference
         to Exhibit 10(dd) to the Company's Annual Report on Form 10-K
          for the Fiscal Year Ended December 29, 1996, File No. 1-6682.)

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  (bb)  Form of Stock Option Agreement (For Participants in the Long
       Term Incentive Program) under the 1992 Stock Incentive Plan
      and the Stock Incentive Performance Plan. (Incorporated by
        reference to Exhibit 10(w) to the Company's Annual Report on
       Form 10-K for the Fiscal Year Ended December 27, 1992, File
No. 1-6682.)                                        

 (cc)  Form of Employment Agreement between the Company and eleven
  officers of the Company. (Incorporated by reference to
         Exhibit 10(v) to the Company's Annual Report on Form 10-K for
      the Fiscal Year Ended December 31, 1989, File No. 1-6682.)

(dd)  Hasbro, Inc. Retirement Plan for Directors. (Incorporated 
  by  reference to Exhibit 10(x) to the Company's Annual
      Report on Form 10-K for the Fiscal Year Ended December 30,
1990, File No. 1-6682.)                             

 (ee)  Form of Director's Indemnification Agreement. (Incorporated
        by reference to Appendix B to the Company's definitive proxy
       statement for its 1988 Annual Meeting of Shareholders, File
No. 1-6682.)                                        

(ff)  Hasbro, Inc. Deferred Compensation Plan for Non-Employee  
     Directors.(Incorporated by reference to Exhibit 10(cc) to
        the Company's Annual Report on Form 10-K for the Fiscal Year
Ended December 26, 1993, File No. 1-6682.)          

(gg)  Hasbro, Inc. Stock Option Plan for Non-Employee Directors.
     (Incorporated by reference to Appendix A to the Company's
     definitive proxy statement for its 1994 Annual Meeting of
Shareholders, File No. 1-6682.)                     

(hh)  Form of Stock Option Agreement for Non-Employee Directors 
     under the Hasbro, Inc. Stock Option Plan for Non-Employee
     Directors. (Incorporated by reference to Exhibit 10(w) to
        the Company's Annual Report on Form 10-K for the Fiscal Year
Ended December 25, 1994, File No. 1-6682.)          

(ii)  Hasbro, Inc. Senior Management Annual Performance Plan.   
     (Incorporated by reference to Appendix B to the Company's
     definitive proxy statement for its 1994 Annual Meeting of
Shareholders, File No. 1-6682.)                     

(jj)  Hasbro, Inc. Amended and Restated Nonqualified Deferred   
       Compensation Plan. (Incorporated by reference to Exhibit 10
         to the Company's Quarterly Report on Form 10-Q for the Period
Ended March 29, 1998, File No. 1-6682.)             

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(kk)  Employment Agreement, dated as of January 1, 1996, between
        the Company and Harold P. Gordon. (Incorporated by reference
         to Exhibit 10(aa) to the Company's Annual Report on Form 10-K
          for the Fiscal Year Ended December 31, 1995, File No. 1-6682.)

 (ll)  Severance And Settlement Agreement And Release, dated as of
        December 20, 1995, and addendum thereto, between the Company
         and Dan D. Owen. (Incorporated by reference to Exhibit 10(bb)
      to the Company's Annual Report on Form 10-K for the Fiscal
Year Ended December 31, 1995, File No. 1-6682.)     

 (mm)  Amendment, effective as of January 1, 1997 to Severance and
    Settlement Agreement and Release between the Company and
     Dan D. Owen. (Incorporated by reference to Exhibit 10(cc)
      to the Company's Annual Report on Form 10-K for the Fiscal
Year Ended December 29, 1996, File No. 1-6682.)     

(nn)  Amendment, dated February 20, 1998, to Severance          
        And Settlement Agreement And Release between the Company and
     Dan D. Owen. (Incorporated by reference to Exhibit 10(ff)
      to the Company's Annual Report on Form 10-K for the Fiscal
Year Ended December 28, 1997, File No. 1-6682.)     

    (oo)  Letter agreements, dated January 30, 1998, between the Company
      and George R. Ditomassi, Jr. (Incorporated by reference to
          Exhibit 10(gg) to the Company's Annual Report on Form 10-K for
      the Fiscal Year Ended December 28, 1997, File No. 1-6682.)

(pp)  Consulting Agreement, dated January 31, 1998, between the 
 Company and George R. Ditomassi, Jr. (Incorporated by
         reference to Exhibit 10(hh) to the Company's Annual Report on
       Form 10-K for the Fiscal Year Ended December 28, 1997, File
No. 1-6682.)                                        

 (qq)  Letter dated January 26, 1998 from the Company to George B.
      Volanakis. (Incorporated by reference to Exhibit 10(ii) to
        the Company's Annual Report on Form 10-K for the Fiscal Year
Ended December 28, 1997, File No. 1-6682.)          

   (rr)  Employment Agreement dated as of January 5, 1999, between the
Company and Herbert M. Baum.                        

 (ss)  Letter agreement, dated March 23, 1999, between the Company
and Adam Klein.                                     

11.  Statement re computation of per share earnings                       

12.  Statement re computation of ratios                                   

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13.  Selected information contained in Annual Report to Shareholders      

22.  Subsidiaries of the registrant                                       

24.  Consents of experts and counsel                                      
(a)  Consent of KPMG LLP                                      

27.  Financial data schedule                                              

The Company agrees to furnish the Securities and Exchange Commission, upon  
request, a copy of each agreement with respect to long-term debt of the         
Company, the authorized principal amount of which does not exceed 10% of the    
total assets of the Company and its subsidiaries on a consolidated basis.       

(b) Reports on Form 8-K                                                     
-------------------                                                 
A Current Report on Form 8-K dated February 4, 1999 was filed to
announce the Company's results for the quarter and year ended   
December 27, 1998. Consolidated statements of earnings (without 
notes) for the quarter and year ended December 27, 1998 and     
December 28, 1997 and consolidated condensed balance sheets     
(without notes) as of said dates were also filed.               

(c) Exhibits                                                                
--------                                                            
See (a)(3) above                                                

(d) Financial Statement Schedules                                           
-----------------------------                                       
See (a)(2) above                                                

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INDEPENDENT AUDITORS' REPORT    

The Board of Directors and Shareholders                                         
Hasbro, Inc.:                                                                   

Under date of February 3, 1999, we reported on the consolidated 
balance sheets of Hasbro, Inc. and subsidiaries as of December 27, 1998 and     
December 28, 1997 and the related consolidated statements of earnings,          
shareholders' equity, and cash flows for each of the fiscal years in the        
three-year period ended December 27, 1998, as contained in the 1998 annual      
report to shareholders. These consolidated financial statements and our         
report thereon are incorporated by reference in the annual report on Form 10-   
K for the year 1998. In connection with our audits of the aforementioned        
consolidated financial statements, we also audited the related financial        
statement schedule listed in Item 14 (a)(2). This financial statement           
schedule is the responsibility of the Company's management. Our                 
responsibility is to express an opinion on this financial statement schedule    
based on our audits.                                                            

    In our opinion, such financial statement schedule when considered in
relation to the basic consolidated financial statements taken as a whole,       
presents fairly in all material respects the information set forth therein.     

/s/ KPMG LLP                                                                    

Providence, Rhode Island                                                        

February 3, 1999                                                                

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   HASBRO, INC. AND SUBSIDIARIES

    Valuation and Qualifying Accounts and Reserves

    Fiscal Years Ended in December

    (Thousands of Dollars)

Provision                   
      Balance at   Charged to                Write-Offs    Balance
      Beginning of   Costs and     Other          And      at End of
       Year       Expenses     Additions    Other (a)     Year
      ------------  ----------  ------------  -----------  ---------

Valuation                                                                       
accounts                                                                      
deducted                                                                      
from assets                                                                   
to which                                                                      
they apply -                                                                  
for doubtful                                                                  
accounts                                                                      
receivable:                                                                   
1998        $51,700       13,057        2,832       (3,189)     $64,400     
        ======       ======       ======       ======       ======
1997        $46,600        9,229            -       (4,129)     $51,700     
        ======       ======       ======       ======       ======
1996        $48,800        5,834            -       (8,034)     $46,600     
        ======       ======       ======       ======       ======

(a) Includes write-offs, recoveries of previous write-offs and          
translation adjustments.                                        

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SIGNATURES                                                                      

Pursuant to the requirements of Section 13 or 15(d) of the Securities       
Exchange Act of 1934, the registrant has duly caused this report to be signed   
on its behalf by the undersigned, thereunto duly authorized.                    

HASBRO, INC.  (Registrant)                                                      

By: /s/ Alan G. Hassenfeld                            Date: March 26, 1999      
-------------------------                               ---------------   
Alan G. Hassenfeld                                                        
Chairman of the Board                                                     

Pursuant to the requirements of the Securities Exchange Act of 1934, this   
report has been signed below by the following persons on behalf of the          
registrant and in the capacities and on the dates indicated.                    

Signature                      Title                        Date                
---------                      -----                        ----                

/s/ Alan G. Hassenfeld                                                        
----------------------------   Chairman of the Board,       March 26, 1999      
Alan G. Hassenfeld             Chief Executive Officer                          
and Director      
           (Principal Executive Officer)

/s/ John T. O'Neill                                                           
----------------------------   Executive Vice President     March 26, 1999      
John T. O'Neill                and Chief Financial Officer                      
      (Principal Financial and
 Accounting Officer)

/s/ Alan R. Batkin                                                            
----------------------------   Director                     March 26, 1999      
Alan R. Batkin                                                                  

/s/ Herbert M. Baum                                                           
----------------------------   Director                     March 26, 1999      
Herbert M. Baum                                                                 

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/s/ Harold P. Gordon                                                          
----------------------------   Director                     March 26, 1999      
Harold P. Gordon                                                                

/s/ Alex Grass                                                                
----------------------------   Director                     March 26, 1999      
Alex Grass                                                                      

/s/ Sylvia K. Hassenfeld                                                      
----------------------------   Director                     March  9, 1999      
Sylvia K. Hassenfeld                                                            

/s/ Marie-Josee Kravis                                                        
----------------------------   Director                     March 26, 1999      
Marie-Josee Kravis                                                              

/s/ Claudine B. Malone                                                        
----------------------------   Director                     March 26, 1999      
Claudine B. Malone                                                              

/s/ Morris W. Offit                                                           
----------------------------   Director                     March  4, 1999      
Morris W. Offit                                                                 

/s/ Norma T. Pace                                                             
----------------------------   Director                     March 26, 1999      
Norma T. Pace                                                                   

/s/ E. John Rosenwald, Jr.                                                    
----------------------------   Director                     March 26, 1999      
E. John Rosenwald, Jr.                                                          

/s/ Carl Spielvogel                                                           
----------------------------   Director                     March 26, 1999      
Carl Spielvogel                                                                 

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/s/ Preston Robert Tisch                                                      
----------------------------   Director                     March 26, 1999      
Preston Robert Tisch                                                            

/s/ Paul Wolfowitz                                                            
----------------------------   Director                     March 26, 1999      
Paul Wolfowitz                                                                  

/s/ Alfred J. Verrecchia                                                      
----------------------------   Director                     March 26, 1999      
Alfred J. Verrecchia                                                            

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HASBRO, INC.

  Annual Report on Form 10-K

  for the Year Ended December 27, 1998

 Exhibit Index

Exhibit                                                                         
-------                                                                         
3.  Articles of Incorporation and Bylaws                                
(a)  Restated Articles of Incorporation of the Company.       
(Incorporated by reference to Exhibit (c)(2) to the 
Company's Current Report on Form 8-K, dated July 15,
1993, File No. 1-6682.)                             

   (b)  Amended and Restated Bylaws of the Company. (Incorporated by
       reference to Exhibit (3) to the Company's Current Report on
Form 8-K, dated February 16, 1996, File No. 1-6682.)

4.  Instruments defining the rights of security holders, including      
indentures.                                                     
(a)  Indenture, dated as of July 17, 1998, by and between the 
   Company and Citibank, N.A. as Trustee. (Incorporated by
       reference to Exhibit 4.1 to the Company's Current Report on
Form 8-K dated July 14, 1998, File No. 1-6682.)     

10.  Material Contracts                                                   
(a)  Lease between Hasbro Canada Inc. (formerly named Hasbro  
       Industries (Canada) Ltd.) and Central Toy Manufacturing Co.
      ("Central Toy"), dated December 23, 1976. (Incorporated by
    reference to Exhibit 10.15 to the Company's Registration
Statement on Form S-14, File No. 2-92550.)          

 (b)  Lease between Hasbro Canada Inc. and Central Toy, together
   with an Addendum thereto, each dated as of May 1, 1987.
        (Incorporated by reference to Exhibit 10(f) to the Company's
Annual Report on Form 10-K for the Fiscal Year Ended
December 27, 1987, File No. 1-6682.)                

    (c)  Addendum to lease, dated March 5, 1998, between Hasbro Canada
        and Central Toy. (Incorporated by reference to Exhibit 10(c)
      to the Company's Annual Report on Form 10-K for the Fiscal
Year Ended December 28, 1997, File No. 1-6682.)     

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 (d)  Toy License Agreement between Lucas Licensing Ltd. And the
    Company, dated as of October 14, 1997. (Portions of this
 agreement have been omitted pursuant to a request for
     confidential treatment under Rule 24b-2 of the Securities
Exchange Act of 1934, as amended.)                  

(e)  First Amendment to Toy License Agreement between Lucas   
           Licensing Ltd. and the Company, dated as of September 25, 1998.
       (Portions of this agreement have been omitted pursuant to a
      request for confidential treatment under Rule 24b-2 of the
Securities Exchange Act of 1934, as amended.)       

     (f)  Agreement of Strategic Relationship between Lucasfilm Ltd. and
       the Company dated as of October 14, 1997. (Portions of this
 agreement have been omitted pursuant to a request for
     confidential treatment under Rule 24b-2 of the Securities
Exchange Act of 1934, as amended.)                  

     (g)  First Amendment to Agreement of Strategic Relationship between
           Lucasfilm Ltd. and the Company, dated as of September 25, 1998.

(h)  Warrant, dated October 14, 1997 between the Company and  
Lucas Licensing Ltd.                                

(i)  Warrant, dated October 14, 1997 between the Company and  
Lucasfilm Ltd.                                      

(j)  Warrant, dated October 30, 1998 between the Company and  
Lucas Licensing Ltd.                                

(k)  Warrant, dated October 30, 1998 between the Company and  
Lucasfilm Ltd.                                      

(l)  Asset Purchase Agreement dated as of February 8, 1998,   
       together with Amendment thereto dated as of March 31, 1998,
      by and among the Company, Tiger Electronics Ltd. (formerly
   named HIAC X Corp. and a wholly-owned subsidiary of the
    Company), Tiger Electronics, Inc. and certain affiliates
        thereof and Owen Randall Rissman and the Rissman Family 1997
    Trust. (Incorporated by reference to Exhibit 2(a) to the
      Company's Current Report on Form 8-K, dated April 1, 1998,
File No. 1-6682.)                                   

Executive Compensation Plans and Arrangements                   
(m)  Employee Incentive Stock Option Plan. (Incorporated by   
   reference to  Exhibit 4.1 to the Company's Registration
Statement on Form S-8, File No. 2-78018.)           

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(n)  Amendment No. 1 to Employee Incentive Stock Option Plan. 
        (Incorporated by reference to Exhibit 10(l) to the Company's
 Annual  Report on Form 10-K for the Fiscal Year Ended
December 28, 1986, File No. 1-6682.)                

(o)  Amendment No. 2 to Employee Incentive Stock Option Plan. 
        (Incorporated by reference to Exhibit 10(n) to the Company's
 Annual  Report on Form 10-K for the Fiscal Year Ended
December 27, 1987, File No. 1-6682.)                

(p)  Amendment No. 3 to Employee Incentive Stock Option Plan. 
        (Incorporated by reference to Exhibit 10(o) to the Company's
Annual Report on Form 10-K for the Fiscal Year Ended
December 25, 1988, File No. 1-6682.)                

(q)  Amendment No. 4 to Employee Incentive Stock Option Plan. 
        (Incorporated by reference to Exhibit 10(s) to the Company's
Annual Report on Form 10-K for the Fiscal Year Ended
December 31, 1989, File No. 1-6682.)                

(r)  Form of Non Qualified Stock Option Agreement under the   
  Employee Incentive Stock Option Plan. (Incorporated by
     reference to Exhibit 10(q) to the Company's Annual Report
     on Form 10-K for the Fiscal Year Ended December 25, 1988,
File No. 1-6682.)                                   

  (s)  Non Qualified Stock Option Plan. (Incorporated by reference
       to Exhibit 10.10 to the Company's Registration Statement on
Form S-14, File No. 2-92550.)                       

(t)  Amendment No. 1 to Non Qualified Stock Option Plan.      
(Incorporated by reference to Exhibit 10(j) to the  
Company's Annual Report on Form 10-K for the Fiscal 
Year Ended December 28, 1986, File No. 1-6682.)     

(u)  Amendment No. 2 to Non Qualified Stock Option Plan.      
     (Incorporated by reference to Appendix A to the Company's
     definitive proxy statement for its 1987 Annual Meeting of
Shareholders, File No. 1-6682.)                     

(v)  Amendment No. 3 to Non Qualified Stock Option Plan.      
        (Incorporated by reference to Exhibit 10(l) to the Company's
Annual Report on Form 10-K for the Fiscal Year Ended
December 31, 1989, File No. 1-6682.)                

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   (w)  Form of Stock Option Agreement (For Employees) under the Non
      Qualified Stock Option Plan. (Incorporated by reference to
     Exhibit 10(t) to the Company's Annual Report on Form 10-K
 for the Fiscal Year Ended December 27, 1992, File No.
1-6682.)                                            

(x)  1992 Stock Incentive Plan. (Incorporated by reference to 
      Appendix A to the Company's definitive proxy statement for
      its 1992 Annual Meeting of Shareholders, File No. 1-6682.)

    (y)  Form of Stock Option Agreement under the 1992 Stock Incentive
       Plan, the Stock Incentive Performance Plan and the Employee
   Non-Qualified Stock Plan. (Incorporated by reference to
         Exhibit 10(v) to the Company's Annual Report on Form 10-K for
      the Fiscal Year Ended December 27, 1992, File No. 1-6682.)

   (z)  Hasbro, Inc. Stock Incentive Performance Plan. (Incorporated
        by reference to Appendix A to the Company's definitive proxy
       statement for its 1995 Annual Meeting of Shareholders, File
No. 1-6682.)                                        

   (aa)  Employee Non-Qualified Stock Plan. (Incorporated by reference
         to Exhibit 10(dd) to the Company's Annual Report on Form 10-K
          for the Fiscal Year Ended December 29, 1996, File No. 1-6682.)

  (bb)  Form of Stock Option Agreement (For Participants in the Long
       Term Incentive Program) under the 1992 Stock Incentive Plan
      and the Stock Incentive Performance Plan. (Incorporated by
        reference to Exhibit 10(w) to the Company's Annual Report on
       Form 10-K for the Fiscal Year Ended December 27, 1992, File
No. 1-6682.)                                        

 (cc)  Form of Employment Agreement between the Company and eleven
  officers of the Company. (Incorporated by reference to
         Exhibit 10(v) to the Company's Annual Report on Form 10-K for
      the Fiscal Year Ended December 31, 1989, File No. 1-6682.)

(dd)  Hasbro, Inc. Retirement Plan for Directors. (Incorporated 
  by  reference to Exhibit 10(x) to the Company's Annual
      Report on Form 10-K for the Fiscal Year Ended December 30,
1990, File No. 1-6682.)                             

 (ee)  Form of Director's Indemnification Agreement. (Incorporated
        by reference to Appendix B to the Company's definitive proxy
       statement for its 1988 Annual Meeting of Shareholders, File
No. 1-6682.)                                        

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(ff)  Hasbro, Inc. Deferred Compensation Plan for Non-Employee  
     Directors.(Incorporated by reference to Exhibit 10(cc) to
        the Company's Annual Report on Form 10-K for the Fiscal Year
Ended December 26, 1993, File No. 1-6682.)          

(gg)  Hasbro, Inc. Stock Option Plan for Non-Employee Directors.
     (Incorporated by reference to Appendix A to the Company's
     definitive proxy statement for its 1994 Annual Meeting of
Shareholders, File No. 1-6682.)                     

(hh)  Form of Stock Option Agreement for Non-Employee Directors 
     under the Hasbro, Inc. Stock Option Plan for Non-Employee
     Directors. (Incorporated by reference to Exhibit 10(w) to
        the Company's Annual Report on Form 10-K for the Fiscal Year
Ended December 25, 1994, File No. 1-6682.)          

(ii)  Hasbro, Inc. Senior Management Annual Performance Plan.   
     (Incorporated by reference to Appendix B to the Company's
     definitive proxy statement for its 1994 Annual Meeting of
Shareholders, File No. 1-6682.)                     

(jj)  Hasbro, Inc. Amended and Restated Nonqualified Deferred   
       Compensation Plan. (Incorporated by reference to Exhibit 10
         to the Company's Quarterly Report on Form 10-Q for the Period
Ended March 29, 1998, File No. 1-6682.)             

(kk)  Employment Agreement, dated as of January 1, 1996, between
        the Company and Harold P. Gordon. (Incorporated by reference
         to Exhibit 10(aa) to the Company's Annual Report on Form 10-K
          for the Fiscal Year Ended December 31, 1995, File No. 1-6682.)

 (ll)  Severance And Settlement Agreement And Release, dated as of
        December 20, 1995, and addendum thereto, between the Company
         and Dan D. Owen. (Incorporated by reference to Exhibit 10(bb)
      to the Company's Annual Report on Form 10-K for the Fiscal
Year Ended December 31, 1995, File No. 1-6682.)     

 (mm)  Amendment, effective as of January 1, 1997 to Severance and
    Settlement Agreement and Release between the Company and
     Dan D. Owen. (Incorporated by reference to Exhibit 10(cc)
      to the Company's Annual Report on Form 10-K for the Fiscal
Year Ended December 29, 1996, File No. 1-6682.)     

(nn)  Amendment, dated February 20, 1998, to Severance          
        And Settlement Agreement And Release between the Company and
     Dan D. Owen. (Incorporated by reference to Exhibit 10(ff)
      to the Company's Annual Report on Form 10-K for the Fiscal
Year Ended December 28, 1997, File No. 1-6682.)     

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    (oo)  Letter agreements, dated January 30, 1998, between the Company
      and George R. Ditomassi, Jr. (Incorporated by reference to
          Exhibit 10(gg) to the Company's Annual Report on Form 10-K for
      the Fiscal Year Ended December 28, 1997, File No. 1-6682.)

(pp)  Consulting Agreement, dated January 31, 1998, between the 
 Company and George R. Ditomassi, Jr. (Incorporated by
         reference to Exhibit 10(hh) to the Company's Annual Report on
       Form 10-K for the Fiscal Year Ended December 28, 1997, File
No. 1-6682.)                                        

 (qq)  Letter dated January 26, 1998 from the Company to George B.
      Volanakis. (Incorporated by reference to Exhibit 10(ii) to
        the Company's Annual Report on Form 10-K for the Fiscal Year
Ended December 28, 1997, File No. 1-6682.)          

   (rr)  Employment Agreement dated as of January 5, 1999, between the
Company and Herbert M. Baum.                        

 (ss)  Letter agreement, dated March 23, 1999, between the Company
and Adam Klein.                                     

11.  Statement re computation of per share earnings                       

12.  Statement re computation of ratios                                   

13.  Selected information contained in Annual Report to Shareholders      

22.  Subsidiaries of the registrant                                       

24.  Consents of experts and counsel                                      
(a)  Consent of KPMG LLP                                      

27.  Financial data schedule                                              

Dates Referenced Herein   and   Documents Incorporated by Reference

				Referenced-On Page
This ‘10-K405’ Filing		Date		First		Last			Other Filings
		10/30/10		20
		10/30/09		20					10-Q,  S-8
		5/19/99		20
Corrected on:		3/30/99
Filed on:		3/29/99							SC 13D
		3/26/99		31		33
		3/23/99		27		39
		3/19/99		2
		3/15/99		20
		3/9/99		32
		3/4/99		32
		2/28/99		6
		2/4/99		28					8-K
		2/3/99		29
		1/5/99		27		39
For Period End:		12/27/98		1		34
		12/9/98		11
		10/30/98		20		35			424B2
		10/14/98		10
		9/25/98		23		35
		7/17/98		23		34			8-K
		7/14/98		23		34			8-K
		4/1/98		24		35			8-K
		3/31/98		24		35			S-8,  S-8 POS
		3/29/98		26		38			10-Q
		3/5/98		23		34
		3/1/98		6
		2/20/98		27		38
		2/11/98		11					SC 13G
		2/9/98		11					8-K
		2/8/98		24		35
		1/31/98		27		39
		1/30/98		27		39
		1/26/98		27		39
		12/28/97		22		39			10-K405
		10/14/97		23		35
		10/2/97		10
		9/25/97		10
		1/1/97		27		38
		12/29/96		25		38			10-K405
		2/16/96		22		34			8-K
		1/1/96		27		38
		12/31/95		27		38			10-K405
		12/20/95		27		38
		12/25/94		26		38			10-K
		12/26/93		26		38			10-K,  DEF 14A
		7/15/93		22		34
		12/27/92		25		37
									List all Filings