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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE
SECURITIES EXCHANGE ACT OF 1934
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(Amendment No. ___)
[x] Filed by the Registrant
[_] Filed by a Party other than the Registrant
Check the appropriate box:
[_] Preliminary Proxy Statement
[_] Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
[_] Definitive Proxy Statement
[x] Definitive Additional Materials
[_] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
GALOOB TOYS, INC
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(Name of Registrant as Specified in Its Charter)
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(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
PAYMENT OF FILING FEE (Check the appropriate box):
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[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and
0-11.
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pursuant to Exchange Act Rule 0-11 (Set forth the amount on which
the filing fee is calculated and state how it was determined.):
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[_] Fee paid previously with preliminary materials.
[_] Check box if any part of the fee is offset as provided by Exchange Act
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was paid previously. Identify the previous filing by registration
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GALOOB
Lewis Galoob Toys, Inc. (415) 952-1678
500 FORBES BLVD., SOUTH SAN FRANCISCO, CA 94080
NOVEMBER 15, 1996
Dear Shareholder:
Through recent conversations with several shareholders who voted their
shares of Galoob common stock against the Company's proposed 1996
Share Incentive Plan, three areas of concern have surfaced which we
want to clarify:
1. Option repricing, substitutions or exchanges
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Paragraph 20 of the Plan states in part "by mutual agreement
between the Company and a participant hereunder, under this Plan
or under any other present or future plan of the Company,
Benefits may be granted to such participant in substitution and
exchange for, and in cancellation of, any Benefits previously
granted such participant under this Plan, or any other present or
future plan of the Company."
The Company has no intention of repricing any outstanding stock
options under the Plan. This was previously expressed to
Institutional Shareholder Services in the letter of October 18,
1996 from Mr. Mark Goldman, the Company's President and CEO.
Paragraph 20 will be amended to clarify that options will not be
repriced after they have been issued.
2. Restricted stock
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Paragraph 8 of the Plan provides for the granting of Stock Awards
without specific time requirements on the restrictions attached
to the award.
It is not the Company's present intention to use such Stock
Awards. The section was included in the plan to provide
flexibility in the future.
However, Paragraph 8 will be amended to specify that Stock Awards
which are not performance based will be restricted for a minimum
three years. Performance based awards will be restricted with
regard to the future goals to be achieved (i.e., earnings or
stock price levels).
3. Dilution
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The proposed plan authorized the issuance of 1,850,000 new
shares. The Company believes this level is needed to
provide adequate incentives to current employees and to hire
appropriate new employees to support the Company's current and
expected future growth.
At October 31, 1996, the Company had 15,149,651 shares
outstanding. We will close our public offering for 2,392,866
shares (which includes a warrant exercise) on Monday, November
18, 1996. In addition, we have outstanding unexercised options
for 1,503,750 shares and unexercised warrants for 75,000 shares.
The total of those is 19,121,267 which makes the new option plan
less than 10% of the total shares outstanding and issuable.
We hope these clarifications will allow you to vote yes on the 1996
Share Incentive Plan. The Annual Meeting was adjourned as to this
matter until November 22, 1996.
If you have any questions, please call me at (415) 952-1678 ext. 2206.
Very truly yours,
William G. Catron
Executive Vice President
General Counsel and Chief Administration Officer
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South San Francisco New York Hong Kong