Commitments and Contingencies

12 Months Ended

Dec. 29, 2019

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Commitments and Contingencies

Hasbro had unused open letters of credit and related instruments of approximately $14,000 and $29,000 at December 29, 2019 and December 30, 2018, respectively.

The Company enters into license agreements with strategic partners, inventors, designers and others for the use of intellectual properties in its products. Certain of these agreements contain provisions for the payment of guaranteed or minimum royalty amounts. Under terms of existing agreements as of December 29, 2019, Hasbro may, provided the other party meets their contractual commitment, be required to pay amounts as follows: 2020: $110,969; 2021: $98,550; 2022: $66,892; 2023: $153; 2024: $153; and thereafter: $459. At December 29, 2019, the Company had $67,574 of prepaid royalties, $52,869 of which are included in prepaid expenses and other current assets and $14,705 of which are included in other assets.

In connection with the Company’s agreement to form a joint venture with Discovery, the Company is obligated to make future payments to Discovery under a tax sharing agreement. The Company estimates these payments may total approximately $29,300 and may range from approximately $4,700 to $6,000 per year during the period 2020 to 2024, and approximately $3,210 in aggregate for all years occurring thereafter. These payments are

contingent upon the Company having sufficient taxable income to realize the expected tax deductions of certain amounts related to the joint venture.

At December 29, 2019, the Company estimates payments related to inventory and tooling purchase commitments may total approximately $670,973, including contractual commitments under the manufacturing agreement with Cartamundi as follows: 2020: $120,000, 2021: $105,000, 2022: $95,000, and 2023: $85,000.

Hasbro is party to certain legal proceedings, as well as certain asserted and unasserted claims. Amounts accrued, as well as the total amount of reasonably possible losses with respect to such matters, individually and in the aggregate, are not deemed to be material to the consolidated financial statements.