Scotts Miracle-Gro Company S-8
As
filed with the Securities and Exchange Commission on February 1, 2006
Registration No. 333
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form S-8
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
THE SCOTTS MIRACLE-GRO COMPANY
(Exact name of registrant as specified in its charter)
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Ohio
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31-1414921 |
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(State or other jurisdiction of
incorporation or organization)
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(I.R.S. Employer
Identification No.) |
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14111 Scottslawn Road, Marysville, Ohio
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43041 |
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(Address of Principal Executive Offices)
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(Zip Code) |
The Scotts Miracle-Gro Company
2006 Long-Term Incentive Plan
(Full title of the plan)
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Copy
to: |
David M. Aronowitz, Esq.
The Scotts Miracle-Gro Company
14111 Scottslawn Road
Marysville, Ohio 43041
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Elizabeth Turrell Farrar, Esq.
Vorys, Sater, Seymour and Pease LLP
52 East Gay Street
P.O. Box 1008 |
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(Name and address of agent for service)
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Columbus, Ohio 43216-1008 |
(937) 644-0011
(Telephone number, including area code, of agent for service)
Calculation of Registration Fee
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Proposed |
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Proposed |
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Title of |
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maximum |
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maximum |
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securities |
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Amount |
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offering |
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aggregate |
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Amount of |
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to be |
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to be |
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price |
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offering |
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registration |
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registered |
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registered (1) |
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per share (2) |
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price (2) |
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fee |
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Common Shares, |
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11,969,546 |
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$49.55 as to 126,000 common shares; |
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$588,708,892 |
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$62,992 |
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without par value |
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$49.18
as to 11,843,546 common shares |
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(1) |
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In addition, pursuant to Rule 416(a) under the Securities Act of 1933, as amended, this
Registration Statement also covers an indeterminate number of additional common shares that
may become issuable pursuant to the anti-dilution provisions of The Scotts Miracle-Gro Company
2006 Long-Term Incentive Plan (the Plan). |
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Estimated solely for the purpose of calculating the aggregate offering price and the
registration fee pursuant to Rules 457(c) and 457(h) promulgated under the Securities Act of
1933, as amended, and computed on the basis of: (a) $49.55 for 126,000 of the common shares
to be registered, which is the price at which outstanding options to purchase such common
shares granted under the Plan may be exercised; and (b) $49.18 for
11,843,546 of the common
shares to be registered, which is the average of the high and low sales prices of the common
shares as reported on the New York Stock Exchange on January 30, 2006. |
TABLE OF CONTENTS
Part II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
The Scotts Miracle-Gro Company (the Registrant) hereby incorporates into this Registration
Statement on Form S-8 (the Registration Statement) the following documents filed by the
Registrant with the Securities and Exchange Commission (the Commission):
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The Annual Report on Form 10-K of the Registrant for the fiscal year ended September
30, 2005. |
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The Current Report on Form 8-K filed by the Registrant with the Commission on
December 14, 2005. |
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The description of the Registrants common shares, without par value, contained in
the Registrants Current Report on Form 8-K filed with the Commission on March 24,
2005. |
Any definitive proxy statement or information statement filed by the Registrant pursuant to
Section 14 of the Securities Exchange Act of 1934, as amended (the Exchange Act), and all
documents which may be filed by the Registrant with the Commission pursuant to Section 13, 14 or
15(d) of the Exchange Act subsequent to the date hereof and prior to the completion of the offering
contemplated by The Scotts Miracle-Gro Company 2006 Long-Term Incentive Plan, shall also be deemed
to be incorporated herein by reference and to be made a part hereof from the date of filing of such
documents. Information furnished by the Registrant under any Current Report on Form 8-K is not
incorporated by reference in this Registration Statement.
Item 4. Description of Securities.
Not Applicable.
Item 5. Interests of Named Experts and Counsel.
Not Applicable.
Item 6. Indemnification of Directors and Officers.
Section 21.18 of The Scotts Miracle-Gro Company 2006 Long-Term Incentive Plan (the Plan),
provides for indemnification of individuals who are or who have been members of the Registrants
Board of Directors (the Board), or a committee appointed or designated by the Board to administer
the Plan (the Committee), or an officer of the Registrant to whom administrative duties or powers
have been delegated in accordance with Article 3 of the Plan. Section 21.18 provides as follows:
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21.18 Indemnification. Subject to requirements of Ohio law, each individual
who is or shall have been a member of the Board, or a Committee appointed by the
Board, or an officer of the Company to whom authority was delegated in accordance
with Article 3, shall be indemnified and held harmless by the Company against and
from any loss, cost, liability, or expense that may be imposed upon or reasonably
incurred by him or her in connection with or resulting from any claim, action, suit,
or proceeding to which he or she may be a party or in which he or she may be
involved by reason of any action taken or failure to act under this Plan and against
and from any and all amounts paid by him or her in settlement thereof, with the
Companys approval, or paid by him or her in satisfaction of any judgment in any
such action, suit, or proceeding against him or her, provided he or she shall give
the Company an opportunity, at its own expense, to handle and defend the same before
he or she undertakes to handle and defend it on his/her own behalf, unless such
loss, cost, liability, or expense is a result of his/her own willful misconduct or
except as expressly provided by statute.
The foregoing right of indemnification shall not be exclusive of any other
rights of indemnification to which such individuals may be entitled under the
Companys Articles of Incorporation or Code of Regulations, as a matter of law, or
otherwise, or any power that the Company may have to indemnify them or hold them
harmless.
Article Five of the Code of Regulations of the Registrant governs the indemnification of
officers and directors of the Registrant. Article Five provides:
Section 5.01. Mandatory Indemnification. The corporation shall
indemnify any officer or director of the corporation who was or is a party or is
threatened to be made a party to any threatened, pending or completed action, suit
or proceeding, whether civil, criminal, administrative or investigative (including,
without limitation, any action threatened or instituted by or in the right of the
corporation), by reason of the fact that he is or was a director, officer, employee
or agent of the corporation, or is or was serving at the request of the corporation
as a director, trustee, officer, employee, member, manager or agent of another
corporation (domestic or foreign, nonprofit or for profit), limited liability
company, partnership, joint venture, trust or other enterprise, against expenses
(including, without limitation, attorneys fees, filing fees, court reporters fees
and transcript costs), judgments, fines and amounts paid in settlement actually and
reasonably incurred by him in connection with such action, suit or proceeding if he
acted in good faith and in a manner he reasonably believed to be in or not opposed
to the best interests of the corporation, and with respect to any criminal action or
proceeding, he had no reasonable cause to believe his conduct was unlawful. A
person claiming indemnification under this Section 5.01 shall be presumed, in
respect of any act or omission giving rise to such claim for indemnification, to
have acted in good faith and in a manner he reasonably believed to be in or not
opposed to the best interests of the corporation, and with
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respect to any criminal matter, to have had no reasonable cause to believe his
conduct was unlawful, and the termination of any action, suit or proceeding by
judgment, order, settlement or conviction, or upon a plea of nolo contendere or its
equivalent, shall not, of itself, rebut such presumption.
Section 5.02. Court-Approved Indemnification. Anything contained in
the Regulations or elsewhere to the contrary notwithstanding:
(A) the corporation shall not indemnify any officer or director of the
corporation who was a party to any completed action or suit instituted by or in the
right of the corporation to procure a judgment in its favor by reason of the fact
that he is or was a director, officer, employee or agent of the corporation, or is
or was serving at the request of the corporation as a director, trustee, officer,
employee, member, manager or agent of another corporation (domestic or foreign,
nonprofit or for profit), limited liability company, partnership, joint venture,
trust or other enterprise, in respect of any claim, issue or matter asserted in such
action or suit as to which he shall have been adjudged to be liable for acting with
reckless disregard for the best interests of the corporation or misconduct (other
than negligence) in the performance of his duty to the corporation unless and only
to the extent that the Court of Common Pleas of Union County, Ohio or the court in
which such action or suit was brought shall determine upon application that, despite
such adjudication of liability, and in view of all the circumstances of the case, he
is fairly and reasonably entitled to such indemnity as such Court of Common Pleas or
such other court shall deem proper; and
(B) the corporation shall promptly make any such unpaid indemnification as is
determined by a court to be proper as contemplated by this Section 5.02.
Section 5.03. Indemnification for Expenses. Anything contained in the
Regulations or elsewhere to the contrary notwithstanding, to the extent that an
officer or director of the corporation has been successful on the merits or
otherwise in defense of any action, suit or proceeding referred to in Section 5.01,
or in defense of any claim, issue or matter therein, he shall be promptly
indemnified by the corporation against expenses (including, without limitation,
attorneys fees, filing fees, court reporters fees and transcript costs) actually
and reasonably incurred by him in connection therewith.
Section 5.04. Determination Required. Any indemnification required
under Section 5.01 and not precluded under Section 5.02 shall be made by the
corporation only upon a determination that such indemnification of the officer or
director is proper in the circumstances because he has met the applicable standard
of conduct set forth in Section 5.01. Such determination may be made only (A) by a
majority vote of a quorum consisting of directors of the corporation who were not
and are not parties to, or threatened with, any such action, suit or proceeding, or
(B) if such a quorum is not obtainable or if a majority of a quorum
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of disinterested directors so directs, in a written opinion by independent legal
counsel other than an attorney, or a firm having associated with it an attorney, who
has been retained by or who has performed services for the corporation, or any
person to be indemnified, within the past five years, or (C) by the shareholders,
or (D) by the Court of Common Pleas of Union County, Ohio or (if the corporation is
a party thereto) the court in which such action, suit or proceeding was brought, if
any; any such determination may be made by a court under division (D) of this
Section 5.04 at any time [including, without limitation, any time before, during or
after the time when any such determination may be requested of, be under
consideration by or have been denied or disregarded by the disinterested directors
under division (A) or by independent legal counsel under division (B) or by the
shareholders under division (C) of this Section 5.04]; and no failure for any
reason to make any such determination, and no decision for any reason to deny any
such determination, by the disinterested directors under division (A) or by
independent legal counsel under division (B) or by shareholders under division (C)
of this Section 5.04 shall be evidence in rebuttal of the presumption recited in
Section 5.01. Any determination made by the disinterested directors under division
(A) or by independent legal counsel under division (B) of this Section 5.04 to make
indemnification in respect of any claim, issue or matter asserted in an action or
suit threatened or brought by or in the right of the corporation shall be promptly
communicated to the person who threatened or brought such action or suit, and within
ten days after receipt of such notification such person shall have the right to
petition the Court of Common Pleas of Union County, Ohio or the court in which such
action or suit was brought, if any, to review the reasonableness of such
determination.
Section 5.05. Advances for Expenses. Expenses (including, without
limitation, attorneys fees, filing fees, court reporters fees and transcript
costs) incurred in defending any action, suit or proceeding referred to in Section
5.01 shall be paid by the corporation in advance of the final disposition of such
action, suit or proceeding to or on behalf of the officer or director promptly as
such expenses are incurred by him, but only if such officer or director shall first
agree, in writing, to repay all amounts so paid in respect of any claim, issue or
other matter asserted in such action, suit or proceeding in defense of which he
shall not have been successful on the merits or otherwise:
(A) if it shall ultimately be determined as provided in Section 5.04 that he is
not entitled to be indemnified by the corporation as provided under Section 5.01; or
(B) if, in respect of any claim, issue or other matter asserted by or in the
right of the corporation in such action or suit, he shall have been adjudged to be
liable for acting with reckless disregard for the best interests of the corporation
or misconduct (other than negligence) in the performance of his duty to the
corporation, unless and only to the extent that the Court of Common Pleas of Union
County, Ohio or the court in which such action or suit was brought shall
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determine upon application that, despite such adjudication of liability, and in view
of all the circumstances, he is fairly and reasonably entitled to all or part of
such indemnification.
Section 5.06. Article FIVE Not Exclusive. The indemnification
provided by this Article FIVE shall not be exclusive of, and shall be in addition
to, any other rights to which any person seeking indemnification may be entitled
under the Articles or the Regulations or any agreement, vote of shareholders or
disinterested directors, or otherwise, both as to action in his official capacity
and as to action in another capacity while holding such office, and shall continue
as to a person who has ceased to be an officer or director of the corporation and
shall inure to the benefit of the heirs, executors, and administrators of such a
person.
Section 5.07. Insurance. The corporation may purchase and maintain
insurance or furnish similar protection, including but not limited to, trust funds,
letters of credit, or self-insurance, on behalf of any person who is or was a
director, officer, employee or agent of the corporation, or is or was serving at the
request of the corporation as a director, trustee, officer, employee, member,
manager or agent of another corporation (domestic or foreign, nonprofit or for
profit), limited liability company, partnership, joint venture, trust or other
enterprise, against any liability asserted against him and incurred by him in any
such capacity, or arising out of his status as such, whether or not the corporation
would have the obligation or the power to indemnify him against such liability under
the provisions of this Article FIVE. Insurance may be purchased from or maintained
with a person in which the corporation has a financial interest.
Section 5.08. Certain Definitions. For purposes of this Article FIVE,
and as examples and not by way of limitation:
(A) A person claiming indemnification under this Article FIVE shall be deemed
to have been successful on the merits or otherwise in defense of any action, suit or
proceeding referred to in Section 5.01, or in defense of any claim, issue or other
matter therein, if such action, suit or proceeding shall be terminated as to such
person, with or without prejudice, without the entry of a judgment or order against
him, without a conviction of him, without the imposition of a fine upon him and
without his payment or agreement to pay any amount in settlement thereof (whether or
not any such termination is based upon a judicial or other determination of the lack
of merit of the claims made against him or otherwise results in a vindication of
him); and
(B) References to an other enterprise shall include employee benefit plans;
references to a fine shall include any excise taxes assessed on a person with
respect to an employee benefit plan; and references to serving at the request of
the corporation shall include any service as a director, officer, employee or agent
of the corporation which imposes duties on, or involves services by, such director,
officer, employee or agent with respect to an employee benefit plan, its
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participants or beneficiaries; and a person who acted in good faith and in a manner
he reasonably believed to be in the best interests of the participants and
beneficiaries of an employee benefit plan shall be deemed to have acted in a manner
not opposed to the best interests of the corporation within the meaning of that
term as used in this Article FIVE.
Section 5.09. Venue. Any action, suit or proceeding to determine a
claim for indemnification under this Article FIVE may be maintained by the person
claiming such indemnification, or by the corporation, in the Court of Common Pleas
of Union County, Ohio. The corporation and (by claiming such indemnification) each
such person consent to the exercise of jurisdiction over its or his person by the
Court of Common Pleas of Union County, Ohio in any such action, suit or proceeding.
Division (E) of Section 1701.13 of the Ohio Revised Code addresses indemnification by an Ohio
corporation and provides as follows:
(E)(1) A corporation may indemnify or agree to indemnify any person who was or
is a party, or is threatened to be made a party, to any threatened, pending, or
completed action, suit, or proceeding, whether civil, criminal, administrative, or
investigative, other than an action by or in the right of the corporation, by reason
of the fact that he is or was a director, officer, employee, or agent of the
corporation, or is or was serving at the request of the corporation as a director,
trustee, officer, employee, member, manager, or agent of another corporation,
domestic or foreign, nonprofit or for profit, a limited liability company, or a
partnership, joint venture, trust, or other enterprise, against expenses including
attorneys fees, judgments, fines and amounts paid in settlement actually and
reasonably incurred by him in connection with such action, suit, or proceeding, if
he acted in good faith and in a manner he reasonably believed to be in or not
opposed to the best interests of the corporation, and, with respect to any criminal
action or proceeding, if he had no reasonable cause to believe his conduct was
unlawful. The termination of any action, suit, or proceeding by judgment, order,
settlement, or conviction, or upon a plea of nolo contendere or its equivalent,
shall not, of itself, create a presumption that the person did not act in good faith
and in a manner he reasonably believed to be in or not opposed to the best interests
of the corporation and, with respect to any criminal action or proceeding, he had
reasonable cause to believe that his conduct was unlawful.
(2) A corporation may indemnify or agree to indemnify any person who was or is
a party, or is threatened to be made a party, to any threatened, pending, or
completed action or suit by or in the right of the corporation to procure a judgment
in its favor, by reason of the fact that he is or was a director, officer, employee,
or agent of the corporation, or is or was serving at the request of the corporation
as a director, trustee, officer, employee, member, manager, or agent of another
corporation, domestic or foreign, nonprofit or for profit, a limited liability
company, or a partnership, joint venture, trust, or other enterprise, against
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expenses, including attorneys fees, actually and reasonably incurred by him in
connection with the defense or settlement of such action or suit, if he acted in
good faith and in a manner he reasonably believed to be in or not opposed to the
best interests of the corporation, except that no indemnification shall be made in
respect of any of the following:
(a) Any claim, issue, or matter as to which such person is adjudged to be
liable for negligence or misconduct in the performance of his duty to the
corporation unless, and only to the extent that, the court of common pleas or the
court in which such action or suit was brought determines, upon application, that,
despite the adjudication of liability, but in view of all the circumstances of the
case, such person is fairly and reasonably entitled to indemnity for such expenses
as the court of common pleas or such other court shall deem proper;
(b) Any action or suit in which the only liability asserted against a director
is pursuant to section 1701.95 of the Revised Code.
(3) To the extent that a director, trustee, officer, employee, member, manager,
or agent has been successful on the merits or otherwise in defense of any action,
suit, or proceeding referred to in division (E)(1) or (2) of this section, or in
defense of any claim, issue, or matter therein, he shall be indemnified against
expenses, including attorneys fees, actually and reasonably incurred by him in
connection with the action, suit, or proceeding.
(4) Any indemnification under division (E)(1) or (2) of this section, unless
ordered by a court, shall be made by the corporation only as authorized in the
specific case, upon a determination that indemnification of the director, trustee,
officer, employee, member, manager, or agent is proper in the circumstances because
he has met the applicable standard of conduct set forth in division (E)(l) or (2) of
this section. Such determination shall be made as follows:
(a) By a majority vote of a quorum consisting of directors of the indemnifying
corporation who were not and are not parties to or threatened with the action, suit,
or proceeding referred to in division (E)(1) or (2) of this section;
(b) If the quorum described in division (E)(4)(a) of this section is not
obtainable or if a majority vote of a quorum of disinterested directors so directs,
in a written opinion by independent legal counsel other than an attorney, or a firm
having associated with it an attorney, who has been retained by or who has performed
services for the corporation or any person to be indemnified within the past five
years;
(c) By the shareholders;
(d) By the court of common pleas or the court in which the action, suit, or
proceeding referred to in division (E)(1) or (2) of this section was brought.
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Any determination made by the disinterested directors under division (E)(4)(a) or by
independent legal counsel under division (E)(4)(b) of this section shall be promptly
communicated to the person who threatened or brought the action or suit by or in the
right of the corporation under division (E)(2) of this section, and, within ten days
after receipt of such notification, such person shall have the right to petition the
court of common pleas or the court in which such action or suit was brought to
review the reasonableness of such determination.
(5)(a) Unless at the time of a directors act or omission that is the subject
of an action, suit, or proceeding referred to in division (E)(1) or (2) of this
section, the articles or the regulations of a corporation state, by specific
reference to this division, that the provisions of this division do not apply to the
corporation and unless the only liability asserted against a director in an action,
suit, or proceeding referred to in division (E)(1) or (2) of this section is
pursuant to section 1701.95 of the Revised Code, expenses, including attorneys
fees, incurred by a director in defending the action, suit, or proceeding shall be
paid by the corporation as they are incurred, in advance of the final disposition of
the action, suit, or proceeding, upon receipt of an undertaking by or on behalf of
the director in which he agrees to do both of the following:
(i) Repay such amount if it is proved by clear and convincing evidence in a
court of competent jurisdiction that his action or failure to act involved an act or
omission undertaken with deliberate intent to cause injury to the corporation or
undertaken with reckless disregard for the best interests of the corporation;
(ii) Reasonably cooperate with the corporation concerning the action, suit, or
proceeding.
(b) Expenses, including attorneys fees, incurred by a director, trustee,
officer, employee, member, manager, or agent in defending any action, suit, or
proceeding referred to in division (E)(1) or (2) of this section, may be paid by the
corporation as they are incurred, in advance of the final disposition of the action,
suit, or proceeding, as authorized by the directors in the specific case, upon
receipt of an undertaking by or on behalf of the director, trustee, officer,
employee, member, manager, or agent to repay such amount, if it ultimately is
determined that he is not entitled to be indemnified by the corporation.
(6) The indemnification authorized by this section shall not be exclusive of,
and shall be in addition to, any other rights granted to those seeking
indemnification under the articles, the regulations, any agreement, a vote of
shareholders or disinterested directors, or otherwise, both as to action in their
official capacities and as to action in another capacity while holding their offices
or positions, and shall continue as to a person who has ceased to be a director,
trustee, officer, employee, member, manager, or agent and shall inure to the
benefit of the heirs, executors, and administrators of such a person.
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(7) A corporation may purchase and maintain insurance or furnish similar
protection, including, but not limited to, trust funds, letters of credit, or
self-insurance, on behalf of or for any person who is or was a director, officer,
employee, or agent of the corporation, or is or was serving at the request of the
corporation as a director, trustee, officer, employee, member, manager, or agent of
another corporation, domestic or foreign, nonprofit or for profit, a limited
liability company, or a partnership, joint venture, trust, or other enterprise,
against any liability asserted against him and incurred by him in any such capacity,
or arising out of his status as such, whether or not the corporation would have the
power to indemnify him against such liability under this section. Insurance may be
purchased from or maintained with a person in which the corporation has a financial
interest.
(8) The authority of a corporation to indemnify persons pursuant to division
(E)(1) or (2) of this section does not limit the payment of expenses as they are
incurred, indemnification, insurance, or other protection that may be provided
pursuant to divisions (E)(5), (6), and (7) of this section. Divisions (E)(1) and
(2) of this section do not create any obligation to repay or return payments made by
the corporation pursuant to division (E)(5), (6), or (7).
(9) As used in division (E) of this section, references to corporation
includes all constituent entities in a consolidation or merger and the new or
surviving corporation, so that any person who is or was a director, officer,
employee, trustee, member, manager, or agent of such a constituent entity, or is or
was serving at the request of such constituent entity as a director, trustee,
officer, employee, member, manager, or agent of another corporation, domestic or
foreign, nonprofit or for profit, a limited liability company, or a partnership,
joint venture, trust, or other enterprise, shall stand in the same position under
this section with respect to the new or surviving corporation as he would if he had
served the new or surviving corporation in the same capacity.
The Registrant has purchased insurance coverage under a policy which insures directors and
officers against certain liabilities which might be incurred by them in such capacity.
Item 7. Exemption from Registration Claimed.
Not Applicable.
Item 8. Exhibits.
See the Index to Exhibits attached hereto and beginning at page 16.
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Item 9. Undertakings.
A. |
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The undersigned Registrant hereby undertakes: |
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(l) |
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To file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement: |
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(i) |
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To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933; |
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(ii) |
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To reflect in the prospectus any facts or events arising after
the effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in the registration
statement. Notwithstanding the foregoing, any increase or decrease in volume
of securities offered (if the total dollar value of securities offered would
not exceed that which was registered) and any deviation from the low or high
end of the estimated maximum offering range may be reflected in the form of
prospectus filed with the Commission pursuant to Rule 424(b) if, in the
aggregate, the changes in volume and price represent no more than a 20% change
in the maximum aggregate offering price set forth in the Calculation of
Registration Fee table in the effective registration statement; and |
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(iii) |
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To include any material information with respect to the plan
of distribution not previously disclosed in the registration statement or any
material change to such information in the registration statement; |
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provided, however, that paragraphs A(1)(i) and A(1)(ii) do not apply if the
information required to be included in a post-effective amendment by those
paragraphs is contained in reports filed with or furnished to the Commission by the
Registrant pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of
1934 that are incorporated by reference in the registration statement. |
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(2) |
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That, for the purpose of determining any liability under the Securities Act of
1933, each such post-effective amendment shall be deemed to be a new registration
statement relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering thereof. |
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(3) |
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To remove from registration by means of a post-effective amendment any of the
securities being registered which remain unsold at the termination of the offering. |
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(4) |
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That, for the purpose of determining liability under the Securities Act of 1933
to any purchaser: |
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(i) If the Registrant is relying on Rule 430B:
(A) Each prospectus filed by the Registrant pursuant to Rule 424(b)(3) shall be deemed
to be part of the registration statement as of the date the filed prospectus was deemed part
of and included in the registration statement; and
(B) Each prospectus required to be filed pursuant to Rule 424(b)(2), (b)(5), or (b)(7)
as part of a registration statement in reliance on Rule 430B relating to an offering made
pursuant to Rule 415(a)(1)(i), (vii), or (x) for the purpose of providing the information
required by Section 10(a) of the Securities Act of 1933 shall be deemed to be part of and
included in the registration statement as of the earlier of the date such form of prospectus
is first used after effectiveness or the date of the first contract of sale of securities in
the offering described in the prospectus. As provided in Rule 430B, for liability purposes
of the issuer and any person that is at that date an underwriter, such date shall be deemed
to be a new effective date of the registration statement relating to the securities in the
registration statement to which that prospectus relates, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof. Provided,
however, that no statement made in a registration statement or prospectus that is part of
the registration statement or made in a document incorporated or deemed incorporated by
reference into the registration statement or prospectus that is part of the registration
statement will, as to a purchaser with a time of contract of sale prior to such effective
date, supersede or modify any statement that was made in the registration statement or
prospectus that was part of the registration statement or made in any such document
immediately prior to such effective date; or
(ii) If the Registrant is subject to Rule 430C, each prospectus filed pursuant to Rule
424(b) as part of a registration statement relating to an offering, other than registration
statements relying on Rule 430B or other than prospectuses filed in reliance on Rule 430A,
shall be deemed to be part of and included in the registration statement as of the date it
is first used after effectiveness. Provided, however, that no statement made in a
registration statement or prospectus that is part of the registration statement or made in a
document incorporated or deemed incorporated by reference into the registration statement or
prospectus that is part of the registration statement will, as to a purchaser with a time of
contract of sale prior to such first use, supersede or modify any statement that was made in
the registration statement or prospectus that was part of the registration statement or made
in any such document immediately prior to such date of first use.
(5) That, for the purpose of determining liability of the Registrant under the Securities Act
of 1933 to any purchaser in the initial distribution of the securities:
The undersigned Registrant undertakes that in a primary offering of securities of the
undersigned Registrant pursuant to this registration statement, regardless of the underwriting
method used to sell the securities to the purchaser, if the securities are offered or sold to such
purchaser by means of any of the following communications, the undersigned Registrant will be a
seller to the purchaser and will be considered to offer or sell such securities to such purchaser:
-12-
(i) Any preliminary prospectus or prospectus of the undersigned Registrant relating to
the offering required to be filed pursuant to Rule 424;
(ii) Any free writing prospectus relating to the offering prepared by or on behalf of
the undersigned Registrant or used or referred to by the undersigned Registrant;
(iii) The portion of any other free writing prospectus relating to the offering
containing material information about the undersigned Registrant or its securities provided
by or on behalf of the undersigned Registrant; and
(iv) Any other communication that is an offer in the offering made by the undersigned
Registrant to the purchaser.
B. |
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The undersigned Registrant hereby undertakes that, for purposes of determining any liability
under the Securities Act of 1933, each filing of the Registrants annual report pursuant to
Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934 (and, where applicable,
each filing of an employee benefit plans annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the registration
statement shall be deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof. |
C. |
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Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be
permitted to directors, officers and controlling persons of the Registrant pursuant to the
provisions described in Item 6 of this Part II, or otherwise, the Registrant has been advised
that in the opinion of the Securities and Exchange Commission such indemnification is against
public policy as expressed in the Act and is, therefore, unenforceable. In the event that a
claim for indemnification against such liabilities (other than the payment by the Registrant
of expenses incurred or paid by a director, officer or controlling person of the Registrant in
the successful defense of any action, suit or proceeding) is asserted by such director,
officer or controlling person in connection with the securities being registered, the
Registrant will, unless in the opinion of its counsel the matter has been settled by
controlling precedent, submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Act and will be governed by
the final adjudication of such issue. |
[Remainder of page intentionally left blank;
signatures on following page.]
-13-
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant certifies that it
has reasonable grounds to believe that it meets all of the requirements for filing on Form S-8 and
has duly caused this Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Marysville, State of Ohio,
on the 1st day of February,
2006.
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THE SCOTTS MIRACLE-GRO COMPANY
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By: |
/s/ James Hagedorn
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James Hagedorn, Chief Executive Officer and |
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Chairman of the Board |
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Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has
been signed by the following persons in the capacities indicated on
February 1, 2006.
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Signature |
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Title |
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Director |
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Mark R. Baker |
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/s/ Gordon F. Brunner*
Gordon F. Brunner
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Director |
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/s/ Arnold W. Donald*
Arnold W. Donald
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Director |
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/s/ Joseph P. Flannery*
Joseph P. Flannery
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Director |
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/s/ Mindy F. Grossman*
Mindy F. Grossman
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Director |
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/s/ James Hagedorn
James Hagedorn
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Chief Executive Officer
and Chairman of the Board (Principal
Executive Officer) and Director |
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/s/ Katherine Hagedorn Littlefield*
Katherine Hagedorn Littlefield
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Director |
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/s/ Karen G. Mills*
Karen G. Mills
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Director |
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Signature |
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Title |
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/s/ Christopher L. Nagel
Christopher L. Nagel
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Executive Vice President
and Chief Financial Officer (Principal
Financial and Principal Accounting
Officer) |
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/s/ Patrick J. Norton*
Patrick J. Norton
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Director |
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*By James Hagedorn pursuant to Powers of Attorney executed by the directors
identified above, which Powers of Attorney have been filed with the Securities and Exchange
Commission as exhibits to this Registration Statement on Form S-8.
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/s/ James Hagedorn
James Hagedorn, Attorney-in-Fact
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-15-
INDEX TO EXHIBITS
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Exhibit No. |
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Description |
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Location |
4.1
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Initial Articles of
Incorporation of The
Scotts Miracle-Gro
Company as filed with
the Ohio Secretary of
State on November 22,
2004
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Incorporated herein by
reference to the Current
Report on Form 8-K of The
Scotts Miracle-Gro Company
dated and filed March 24,
2005 (File No. 1-13292)
[Exhibit 3.1] |
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4.2
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Certificate of
Amendment by
Shareholders to
Articles of
Incorporation of The
Scotts Miracle-Gro
Company as filed with
the Ohio Secretary of
State on March 18,
2005
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Incorporated herein by
reference to the Current
Report on Form 8-K of The
Scotts Miracle-Gro Company
dated and filed March 24,
2005 (File No. 1-13292)
[Exhibit 3.2] |
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4.3
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Code of Regulations of
The Scotts Miracle-Gro
Company
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Incorporated herein by
reference to the Current
Report on Form 8-K of The
Scotts Miracle-Gro Company
dated and filed March 24,
2005 (File No. 1-13292)
[Exhibit 3.3] |
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5.1
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Opinion of Vorys,
Sater, Seymour and
Pease LLP regarding
legality of securities
being registered
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Filed herewith |
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10.1
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The Scotts Miracle-Gro
Company 2006 Long-Term
Incentive Plan
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Filed herewith |
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23.1
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Consent of Deloitte &
Touche LLP, independent
registered public
accounting firm
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Filed herewith |
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23.2
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Consent of
PricewaterhouseCoopers
LLP, independent
registered public
accounting firm
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Filed herewith |
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23.3
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Consent of Vorys,
Sater, Seymour and
Pease LLP
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Filed as part of Exhibit 5.1 |
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24.1
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Powers of Attorney of
Executive Officers and
Directors of The
Scotts Miracle-Gro
Company
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Filed herewith |
-16-
Exhibit 5.1
Exhibit 5.1
[LETTERHEAD OF VORYS, SATER, SEYMOUR AND PEASE LLP]
Writers Direct Dial Number
(614) 464-6400
February 1, 2006
Board of Directors
The Scotts Miracle-Gro Company
14111 Scottslawn Road
Marysville, OH 43041
Ladies and Gentlemen:
We have acted as counsel to The Scotts Miracle-Gro Company, an Ohio corporation (the
Company), in connection with the Companys Registration Statement on Form S-8 (the Registration
Statement) filed with the Securities and Exchange Commission on the date hereof in order to
register 11,969,546 common shares, without par value (the Common Shares), under the provisions
of the Securities Act of 1933, as amended (the Act), and the rules and regulations promulgated
thereunder (the Rules and Regulations), for issuance pursuant to awards granted and to be granted
under The Scotts Miracle-Gro Company 2006 Long-Term Incentive Plan (the Plan).
In connection with rendering this opinion, we have examined, to the extent deemed necessary,
originals or copies, the authenticity of which has been established to our satisfaction, of: (a)
the Registration Statement; (b) the Plan; (c) the Companys Initial Articles of Incorporation, as
amended to date (the Articles); (d) the Companys Code of Regulations, as currently in effect
(the Regulations); and (e) certain corporate records of the Company, including resolutions adopted
by the directors of the Company and by the shareholders of the Company. We have also relied upon
such representations of the officers of the Company and examined such authorities of law as we have
deemed relevant as a basis for this opinion.
In our examination of the aforesaid documents, we have assumed, without independent
investigation, the authenticity of all records, documents and certificates examined by us, the
correctness of the information contained in all records, documents and certificates examined by us,
the genuineness of all signatures, the legal capacity of all individuals who have executed any of
the aforesaid documents and certificates, the authority of all individuals entering and maintaining
records, and the conformity to authentic originals of all items submitted to us as copies (whether
certified, conformed, photostatic or by other electronic means) of records, documents or
certificates.
We have relied solely upon the examinations and inquiries recited herein, and, except for the
examinations and inquiries recited herein, we have not undertaken any independent
Board of Directors
February 1, 2006
Page 2
investigation to determine the existence or absence of any facts, and no inference as to our
knowledge concerning such facts should be drawn.
As used herein, the phrase validly issued means that the particular action has been
authorized by all necessary corporate action of the Company and that the Company has the corporate
authority to take such action under Chapter 1701 of the Ohio Revised Code (the Ohio General
Corporation Law) and the Companys Articles and Regulations.
Based upon and subject to the foregoing and subject to the qualifications and limitations set
forth below, as of the date hereof, we are of the opinion that the
11,969,546 Common Shares to be
registered under the Act for issuance under the Plan, when issued, delivered and paid for, as
appropriate, in the manner provided and for the consideration prescribed in the Plan and in any
award agreements entered into by participants in the Plan with the Company as contemplated by the
Plan, pursuant to which such 11,969,546 Common Shares will be issued under the Plan, will be
validly issued, fully paid and non-assessable, assuming compliance with applicable securities laws.
Members of our firm are admitted to the Bar in the State of Ohio and we express no opinion as
to the laws of any jurisdiction other than the laws of the State of Ohio, including the applicable
provisions of the Ohio Constitution and the reported judicial decisions interpreting those laws,
and of the United States of America.
This opinion is based upon the laws and legal interpretations in effect, and the facts and
circumstances existing, on the date hereof, and we assume no obligation to revise or supplement
this opinion should any such law or legal interpretation be changed by legislative action, judicial
interpretation or otherwise or should there be any change in such facts or circumstances.
This opinion is furnished by us solely for the benefit of the Company in connection with the
offering of the 11,969,546 Common Shares covered by the Registration Statement pursuant to the
Plan and the filing of the Registration Statement and any amendments thereto. This opinion may not
be relied upon by any other person or for any other purpose.
Notwithstanding the foregoing, we consent to the filing of this opinion as an exhibit to the
Registration Statement and to the reference to us therein. By giving such consent, we do not
thereby admit that we come within the category of persons whose consent is required under Section 7
of the Act or the Rules and Regulations.
Except in connection with the Registration Statement as aforesaid, no portion of this opinion
may be quoted or otherwise used by any person without our prior written consent.
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Sincerely, |
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/s/ Vorys, Sater, Seymour and Pease LLP |
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VORYS, SATER, SEYMOUR AND PEASE LLP |
Exhibit 10.1
Exhibit 10.1
The Scotts Miracle-Gro Company
2006 Long-Term Incentive Plan
Effective January 26, 2006
Contents
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Article 1.
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Establishment, Purpose, and Duration |
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Article 2.
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Definitions |
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Article 3.
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Administration |
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Article 4.
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Shares Subject to this Plan and Maximum Awards |
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Article 5.
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Eligibility and Participation |
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Article 6.
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Stock Options |
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Article 7.
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Stock Appreciation Rights |
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Article 8.
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Restricted Stock and Restricted Stock Units |
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Article 9.
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Performance Units/ Performance Shares |
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Article 10.
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Cash-Based Awards and Other Stock-Based Awards |
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Article 11.
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Transferability of Awards |
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Article 12.
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Performance Measures |
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Article 13.
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Nonemployee Director Awards |
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Article 14.
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Dividend Equivalents |
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Article 15.
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Beneficiary Designation |
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Article 16.
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Rights of Participants |
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Article 17.
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Change of Control |
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Article 18.
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Amendment, Modification, Suspension, and Termination |
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Article 19.
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Withholding |
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Article 20.
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Successors |
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Article 21.
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General Provisions |
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17 |
i
THE SCOTTS MIRACLE-GRO COMPANY
2006 LONG-TERM INCENTIVE PLAN
Article 1.
Establishment, Purpose, and Duration
1.1 Establishment. The Scotts Miracle-Gro Company,
an Ohio corporation (hereinafter referred to as the
Company), establishes an incentive compensation plan
to be known as The Scotts Miracle-Gro Company 2006 Long-Term
Incentive Plan (hereinafter referred to as the
Plan), as set forth in this document.
This Plan permits the grant of Nonqualified Stock Options,
Incentive Stock Options, Stock Appreciation Rights, Restricted
Stock, Restricted Stock Units, Performance Shares, Performance
Units, Cash-Based Awards, and Other Stock-Based Awards.
This Plan shall become effective upon shareholder approval (the
Effective Date) and shall remain in effect as
provided in Section 1.3 hereof.
1.2 Purpose of this Plan. The purpose of this Plan
is to provide a means whereby Employees, Directors, and Third
Party Service Providers develop a sense of proprietorship and
personal involvement in the development and financial success of
the Company, and to encourage them to devote their best efforts
to the business of the Company, thereby advancing the interests
of the Company and its shareholders. A further purpose of this
Plan is to provide a means through which the Company may attract
able individuals to become Employees or serve as Directors or
Third Party Service Providers and to provide a means whereby
those individuals upon whom the responsibilities of the
successful administration and management of the Company are of
importance, can acquire and maintain stock ownership, thereby
strengthening their concern for the welfare of the Company.
1.3 Duration of this Plan. Unless sooner terminated
as provided herein, this Plan shall terminate ten
(10) years from the Effective Date, e.g. on the day before
the tenth (10th) anniversary of the Effective Date. After this
Plan is terminated, no Awards may be granted but Awards
previously granted shall remain outstanding in accordance with
their applicable terms and conditions and this Plans terms
and conditions. Notwithstanding the foregoing, no Incentive
Stock Options may be granted more than ten (10) years after
the earlier of (a) adoption of this Plan by the Board, or
(b) the Effective Date.
Article 2.
Definitions
Whenever used in this Plan, the following terms shall have the
meanings set forth below, and when the meaning is intended, the
initial letter of the word shall be capitalized.
2.1 Affiliate shall mean any corporation
or other entity (including, but not limited to, a partnership or
a limited liability company), that is affiliated with the
Company through stock or equity ownership or otherwise, and is
designated as an Affiliate for purposes of this Plan by the
Committee.
2.2 Annual Award Limit or
Annual Award Limits have the meaning set
forth in Section 4.3.
2.3 Award means, individually or
collectively, a grant under this Plan of Nonqualified Stock
Options, Incentive Stock Options, SARs, Restricted Stock,
Restricted Stock Units, Performance Shares, Performance Units,
Cash-Based Awards, or Other Stock-Based Awards, in each case
subject to the terms of this Plan.
2.4 Award Agreement means either
(i) a written agreement entered into by the Company and a
Participant setting forth the terms and provisions applicable to
an Award granted under this Plan, or (ii) a written or
electronic statement issued by the Company to a Participant
describing the terms and provisions of such Award, including in
each case any amendment or modification thereof. The Committee
may provide for the use of electronic, internet or other
non-paper Award Agreements, and the use of electronic, internet
or other non-paper means for the acceptance thereof and actions
thereunder by a Participant.
1
2.5 Beneficial Owner or
Beneficial Ownership shall have the meaning
ascribed to such term in Rule 13d-3 of the General Rules
and Regulations under the Exchange Act.
2.6 Board or Board of
Directors means the Board of Directors of the Company.
2.7 Cash-Based Award means an Award,
denominated in cash, granted to a Participant as described in
Article 10.
2.8 Cause means, unless otherwise
specified in an Award Agreement or in an applicable employment
agreement between the Company and a Participant, with respect to
any Participant:
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(a) Willful failure to substantially perform his or her
duties as an Employee (for reasons other than physical or mental
illness) or director after reasonable notice to the Participant
of that failure; |
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(b) Misconduct that materially injures the Company or any
Subsidiary or Affiliate; |
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(c) Conviction of, or entering into a plea of nolo
contendere to, a felony; or |
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(d) Breach of any written covenant or agreement with the
Company or any Subsidiary or Affiliate. |
2.9 Change in Control means any of the
following events:
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(a) The members of the Board on the Effective Date
(Incumbent Directors) cease for any reason other
than death to constitute at least a majority of the members of
the Board, provided that any director whose election, or
nomination for election by the Companys shareholders, was
approved by a vote of at least a majority of the then Incumbent
Directors also will be treated as an Incumbent Director; or |
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(b) Any person, including a group
[as such terms are used in Exchange Act Sections 13(d) and
14(d)(2), but excluding the Company, any of its Subsidiaries,
any employee benefit plan of the Company or any of its
Subsidiaries or Hagedorn Partnership, L.P. or any party related
to Hagedorn Partnership, L.P. as determined by the Committee] is
or becomes the Beneficial Owner, directly or indirectly, of
securities of the Company representing more than thirty percent
(30%) of the combined voting power of the Companys then
outstanding securities; or |
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(c) The adoption or authorization by the shareholders of
the Company of a definitive agreement or a series of related
agreements (a) for the merger or other business combination
of the Company with or into another entity in which the
shareholders of the Company immediately before the effective
date of such merger or other business combination own less than
fifty percent (50%) of the voting power in such entity; or
(b) for the sale or other disposition of all or
substantially all of the assets of the Company; or |
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(d) The adoption by the shareholders of the Company of a
plan relating to the liquidation or dissolution of the Company;
or |
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(e) For any reason, Hagedorn Partnership, L.P. or any party
related to Hagedorn Partnership, L.P. as determined by the
Committee becomes the Beneficial Owner, directly or indirectly,
of securities of the Company representing more than forty-nine
percent (49%) of the combined voting power of the Companys
then outstanding securities. |
2.10 Change in Control Price means the
highest price per Share offered in conjunction with any
transaction resulting in a Change in Control (as determined in
good faith by the Committee if any part of the offered price is
payable other than in cash) or, in the case of a Change in
Control occurring solely by reason of events not related to a
transfer of Shares, the highest Fair Market Value of a Share on
any of the thirty (30) consecutive trading days ending on
the last trading day before the Change in Control occurs.
2.11 Code means the U.S. Internal
Revenue Code of 1986, as amended from time to time. For purposes
of this Plan, references to sections of the Code shall be deemed
to include references to any applicable regulations thereunder
and any successor or similar provision, as well as any
applicable interpretative guidance issued related thereto.
2
2.12 Committee means the Compensation
and Organization Committee of the Board or a subcommittee
thereof, or any other committee designated by the Board to
administer this Plan. The members of the Committee shall be
appointed from time to time by and shall serve at the discretion
of the Board. If the Committee does not exist or cannot function
for any reason, the Board may take any action under the Plan
that would otherwise be the responsibility of the Committee.
2.13 Company means The Scotts
Miracle-Gro Company, an Ohio corporation, and any successor
thereto as provided in Article 20 herein.
2.14 Covered Employee means any key
Employee who is or may become a Covered Employee, as
defined in Code Section 162(m), and who is designated,
either as an individual Employee or class of Employees, by the
Committee within the shorter of (i) ninety (90) days
after the beginning of the Performance Period, or
(ii) twenty-five percent (25%) of the Performance Period
has elapsed, as a Covered Employee under this Plan
for such applicable Performance Period.
2.15 Director means any individual who
is a member of the Board of Directors of the Company.
2.16 Effective Date has the meaning set
forth in Section 1.1.
2.17 Employee means any individual who
performs services for and is designated as an employee of the
Company, its Affiliates, and/or its Subsidiaries on the payroll
records thereof. An Employee shall not include any individual
during any period he or she is classified or treated by the
Company, Affiliate, and/or Subsidiary as an independent
contractor, a consultant, or any employee of an employment,
consulting, or temporary agency or any other entity other than
the Company, Affiliate, and/or Subsidiary, without regard to
whether such individual is subsequently determined to have been,
or is subsequently retroactively reclassified as a common-law
employee of the Company, Affiliate, and/or Subsidiary during
such period.
2.18 Exchange Act means the Securities
Exchange Act of 1934, as amended from time to time, or any
successor act thereto.
2.19 Fair Market Value or
FMV means a price that is based on the
opening, closing, actual, high, low, or average selling prices
of a Share reported on the New York Stock Exchange
(NYSE) or other established stock exchange (or
exchanges) on the applicable date, the preceding trading day,
the next succeeding trading day, or an average of trading days,
as determined by the Committee in its discretion. Unless the
Committee determines otherwise, Fair Market Value shall be
deemed to be equal to the closing price of a Share on the most
recent date on which Shares were publicly traded. In the event
Shares are not publicly traded at the time a determination of
their value is required to be made hereunder, the determination
of their Fair Market Value shall be made by the Committee in
such manner as it deems appropriate. Such definition(s) of FMV
shall be specified in each Award Agreement and may differ
depending on whether FMV is in reference to the grant, exercise,
vesting, settlement, or payout of an Award.
2.20 Full Value Award means an Award
other than in the form of an ISO, NQSO, or SAR, and which is
settled by the issuance of Shares.
2.21 Grant Date means the date an Award
is granted to a Participant pursuant to the Plan.
2.22 Grant Price means the price
established at the time of grant of a SAR pursuant to
Article 7, used to determine whether there is any payment
due upon exercise of the SAR.
2.23 Incentive Stock Option or
ISO means an Option to purchase Shares
granted under Article 6 to an Employee and that is
designated as an Incentive Stock Option and that is intended to
meet the requirements of Code Section 422, or any successor
provision.
2.24 Insider shall mean an individual
who is, on the relevant date, an officer or Director of the
Company, or a more than ten percent (10%) Beneficial Owner of
any class of the Companys equity securities that is
registered pursuant to Section 12 of the Exchange Act, as
determined by the Board or Committee in accordance with
Section 16 of the Exchange Act.
2.25 Nonemployee Director means a
Director who is not an Employee on the Grant Date.
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2.26 Nonemployee Director Award means
any NQSO, SAR, or Full Value Award granted, whether singly, in
combination, or in tandem, to a Participant who is a Nonemployee
Director pursuant to such applicable terms, conditions, and
limitations as the Board or Committee may establish in
accordance with this Plan.
2.27 Nonqualified Stock Option or
NQSO means an Option that is not intended to
meet the requirements of Code Section 422, or that
otherwise does not meet such requirements.
2.28 Option means an Incentive Stock
Option or a Nonqualified Stock Option, as described in
Article 6.
2.29 Option Price means the price at
which a Share may be purchased by a Participant pursuant to an
Option.
2.30 Other Stock-Based Award means an
equity-based or equity-related Award not otherwise described by
the terms of this Plan, granted pursuant to Article 10.
2.31 Participant means any eligible
individual as set forth in Article 5 to whom an Award is
granted.
2.32 Performance-Based Compensation
means compensation under an Award that is intended to
satisfy the requirements of Code Section 162(m) for certain
performance-based compensation paid to Covered Employees.
Notwithstanding the foregoing, nothing in this Plan shall be
construed to mean that an Award which does not satisfy the
requirements for performance-based compensation under Code
Section 162(m) does not constitute performance-based
compensation for other purposes, including Code
Section 409A.
2.33 Performance Measures means measures
as described in Article 12 on which the performance goals
are based and which are approved by the Companys
shareholders pursuant to this Plan in order to qualify Awards as
Performance-Based Compensation.
2.34 Performance Period means the period
of time during which the performance goals must be met in order
to determine the degree of payout and/or vesting with respect to
an Award.
2.35 Performance Share means an Award
under Article 9 herein and subject to the terms of this
Plan, denominated in Shares, the value of which at the time it
is payable is determined as a function of the extent to which
corresponding performance criteria or Performance Measure(s), as
applicable, have been achieved.
2.36 Performance Unit means an Award
under Article 9 herein and subject to the terms of this
Plan, denominated in units, the value of which at the time it is
payable is determined as a function of the extent to which
corresponding performance criteria or Performance Measure(s), as
applicable, have been achieved.
2.37 Period of Restriction means the
period when Restricted Stock or Restricted Stock Units are
subject to a substantial risk of forfeiture (based on the
passage of time, the achievement of performance goals, or the
occurrence of other events as determined by the Committee, in
its discretion), as provided in Article 8.
2.38 Person shall have the meaning
ascribed to such term in Section 3(a)(9) of the Exchange
Act and used in Sections 13(d) and 14(d) thereof, including
a group as defined in Section 13(d) thereof.
2.39 Plan means The Scotts Miracle-Gro
Company 2006 Long-Term Incentive Plan.
2.40 Plan Year
means the Companys fiscal year.
2.41 Prior Plans
means The Scotts Miracle-Gro Company 2003 Stock Option and
Incentive Equity Plan, as amended, and The Scotts Miracle-Gro
Company 1996 Stock Option Plan, as amended.
2.42 Restricted
Stock means an Award granted to a Participant pursuant
to Article 8.
2.43 Restricted Stock
Unit means an Award granted to a Participant pursuant
to Article 8, except no Shares are actually awarded to the
Participant on the Grant Date.
2.44 Share means
a common share of the Company, without par value per share.
4
2.45 Stock Appreciation
Right or SAR means an Award,
designated as a SAR, pursuant to the terms of Article 7
herein.
2.46 Subsidiary
means any corporation or other entity, whether domestic or
foreign, in which the Company has or obtains, directly or
indirectly, a proprietary interest of more than fifty percent
(50%) by reason of stock ownership or otherwise.
2.47 Third Party Service
Provider means any consultant, agent, advisor, or
independent contractor who renders services to the Company, a
Subsidiary, or an Affiliate that (a) are not in connection
with the offer or sale of the Companys securities in a
capital raising transaction, and (b) do not directly or
indirectly promote or maintain a market for the Companys
securities.
Article 3.
Administration
3.1 General. The Committee
shall be responsible for administering this Plan, subject to
this Article 3 and the other provisions of this Plan. The
Committee may employ attorneys, consultants, accountants,
agents, and other individuals, any of whom may be an Employee,
and the Committee, the Company, and its officers and Directors
shall be entitled to rely upon the advice, opinions, or
valuations of any such individuals. All actions taken and all
interpretations and determinations made by the Committee shall
be final and binding upon the Participants, the Company, and all
other interested individuals.
3.2 Authority of the
Committee. The Committee shall have full and exclusive
discretionary power to interpret the terms and the intent of
this Plan and any Award Agreement or other agreement or document
ancillary to or in connection with this Plan, to determine
eligibility for Awards and to adopt such rules, regulations,
forms, instruments, and guidelines for administering this Plan
as the Committee may deem necessary or proper. Such authority
shall include, but not be limited to, selecting Award
recipients, establishing all Award terms and conditions,
including the terms and conditions set forth in Award
Agreements, granting Awards as an alternative to or as the form
of payment for grants or rights earned or due under compensation
plans or arrangements of the Company, construing any provision
of the Plan or any Award Agreement, and, subject to
Article 18, adopting modifications and amendments to this
Plan or any Award Agreement, including without limitation, any
that are necessary to comply with the laws of the countries and
other jurisdictions in which the Company, its Affiliates, and/or
its Subsidiaries operate.
3.3 Delegation. The
Committee may delegate to one or more of its members or to one
or more officers of the Company, and/or its Subsidiaries and
Affiliates or to one or more agents or advisors such
administrative duties or powers as it may deem advisable, and
the Committee or any individuals to whom it has delegated duties
or powers as aforesaid may employ one or more individuals to
render advice with respect to any responsibility the Committee
or such individuals may have under this Plan. The Committee may,
by resolution, authorize one or more officers of the Company to
do one or both of the following on the same basis as can the
Committee: (a) designate Employees to be recipients of
Awards; (b) determine the size of any such Awards;
provided, however, (i) the Committee shall not delegate
such responsibilities to any such officer for Awards granted to
an Employee who is considered an Insider; (ii) the
resolution providing such authorization sets forth the total
number of Awards such officer(s) may grant; and (iii) the
officer(s) shall report periodically to the Committee regarding
the nature and scope of the Awards granted pursuant to the
authority delegated.
5
Article 4.
Shares Subject to this Plan and Maximum Awards
4.1 Number of Shares Available
for Awards.
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(a) Subject to adjustment as provided in Section 4.4
herein, the maximum number of Shares available for grant to
Participants under this Plan (the Share
Authorization) shall be: |
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(i) Four million nine hundred twenty-seven thousand three
hundred seventy-eight (4,927,378) newly authorized Shares, plus |
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(ii) (A) One million seventy-two thousand six hundred
twenty-two (1,072,622) Shares not granted or subject to
outstanding awards under the Companys Prior Plans as of
September 30, 2005 (on a split-adjusted basis to reflect
the 2-for-1 stock split on November 9, 2005) and
(B) any Shares subject to the six million six hundred
thirteen thousand nine hundred thirty-four (6,613,934)
outstanding awards as of September 30, 2005 (on a
split-adjusted basis to reflect the 2-for-1 stock split on
November 9, 2005) under the Prior Plans that on or after
September 30, 2005 cease for any reason to be subject to
such awards (other than by reason of exercise or settlement of
the awards to the extent they are exercised for or settled in
vested and nonforfeitable Shares), up to an aggregate maximum of
six million six hundred thirteen thousand nine hundred
thirty-four (6,613,934) Shares. |
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(b) No more than three million (3,000,000) Shares of the
Share Authorization may be granted as Full Value Awards. |
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(c) The maximum number of Shares of the Share Authorization
that may be issued pursuant to ISOs under this Plan shall be six
million (6,000,000) Shares. |
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(d) The maximum number of Shares of the Share Authorization
that may be granted to Nonemployee Directors shall be one
million (1,000,000) Shares. |
4.2 Share Usage. Shares
covered by an Award shall only be counted as used to the extent
they are actually issued; however, the full number of Stock
Appreciation Rights granted that are to be settled by the
issuance of Shares shall be counted against the number of Shares
available for award under the Plan, regardless of the number of
Shares actually issued upon settlement of such Stock
Appreciation Rights. Any Shares related to Awards which
terminate by expiration, forfeiture, cancellation, or otherwise
without the issuance of such Shares, are settled in cash in lieu
of Shares, or are exchanged with the Committees
permission, prior to the issuance of Shares, for Awards not
involving Shares, shall be available again for grant under this
Plan. The Shares available for issuance under this Plan may be
authorized and unissued Shares or treasury Shares.
4.3 Annual Award Limits.
Unless and until the Committee determines that an Award to a
Covered Employee shall not be designed to qualify as
Performance-Based Compensation, the following limits (each an
Annual Award Limit and, collectively, Annual
Award Limits) shall apply to grants of such Awards under
this Plan:
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(a) Options: The maximum aggregate number of Shares
subject to Options granted in any one Plan Year to any one
Participant shall be two hundred thousand (200,000), as adjusted
pursuant to Sections 4.4 and/or 18.2. |
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(b) SARs: The maximum number of Shares subject to
Stock Appreciation Rights granted in any one Plan Year to any
one Participant shall be two hundred thousand (200,000), as
adjusted pursuant to Sections 4.4 and/or 18.2. |
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(c) Restricted Stock or Restricted Stock Units: The
maximum aggregate grant with respect to Awards of Restricted
Stock or Restricted Stock Units in any one Plan Year to any one
Participant shall be one hundred thousand (100,000), as adjusted
pursuant to Sections 4.4 and/or 18.2. |
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(d) Performance Units or Performance Shares: The
maximum aggregate Award of Performance Units or Performance
Shares that a Participant may receive in any one Plan Year shall
be one hundred thousand (100,000) Shares, as adjusted pursuant
to Sections 4.4 and/or 18.2, or |
6
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equal to the value of one hundred thousand (100,000) Shares, as
adjusted pursuant to Sections 4.4 and/or 18.2, determined
as of the date of vesting or payout, as applicable. |
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(e) Cash-Based Awards: The maximum aggregate amount
awarded or credited with respect to Cash-Based Awards to any one
Participant in any one Plan Year may not exceed the greater of
the value of three million dollars ($3,000,000) or one hundred
thousand (100,000) Shares, as adjusted pursuant to
Sections 4.4 and/or 18.2, determined as of the date of
vesting or payout, as applicable. |
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(f) Other Stock-Based Awards. The maximum aggregate
grant with respect to Other Stock-Based Awards pursuant to
Section 10.2 in any one Plan Year to any one Participant
shall be one hundred fifty thousand (150,000) Shares, as
adjusted pursuant to Sections 4.4 and/or 18.2. |
4.4 Adjustments in Authorized
Shares. In the event of any corporate event or transaction
(including, but not limited to, a change in the Shares of the
Company or the capitalization of the Company) such as a merger,
consolidation, reorganization, recapitalization, separation,
partial or complete liquidation, stock dividend, stock split,
reverse stock split, split up, spin-off, or other distribution
of stock or property of the Company, combination of Shares,
exchange of Shares, dividend in kind, or other like change in
capital structure, number of outstanding Shares or distribution
(other than normal cash dividends) to shareholders of the
Company, or any similar corporate event or transaction, the
Committee, in its sole discretion, in order to prevent dilution
or enlargement of Participants rights under this Plan,
shall substitute or adjust, as applicable, the number and kind
of Shares that may be issued under this Plan or under particular
forms of Awards, the number and kind of Shares subject to
outstanding Awards, the Option Price or Grant Price applicable
to outstanding Awards, the Annual Award Limits, and other value
determinations applicable to outstanding Awards.
The Committee, in its sole discretion, may also make appropriate
adjustments in the terms of any Awards under this Plan to
reflect or related to such changes or distributions and to
modify any other terms of outstanding Awards, including
modifications of performance goals and changes in the length of
Performance Periods. The determination of the Committee as to
the foregoing adjustments, if any, shall be conclusive and
binding on Participants under this Plan.
Subject to the provisions of Article 18 and notwithstanding
anything else herein to the contrary, without affecting the
number of Shares reserved or available hereunder, the Committee
may authorize the issuance or assumption of benefits under this
Plan in connection with any merger, consolidation, acquisition
of property or stock, or reorganization upon such terms and
conditions as it may deem appropriate (including, but not
limited to, a conversion of equity awards into Awards under this
Plan in a manner consistent with paragraph 53 of FASB
Interpretation No. 44), subject to compliance with the
rules under Code Sections 422 and 424, as and where
applicable.
Article 5.
Eligibility and Participation
5.1 Eligibility. Individuals
eligible to participate in this Plan include all Employees,
Directors, and Third Party Service Providers.
5.2 Actual Participation.
Subject to the provisions of this Plan, the Committee may, from
time to time, select from all eligible individuals, those
individuals to whom Awards shall be granted and shall determine,
in its sole discretion, the nature of, any and all terms
permissible by law, and the amount of each Award.
Article 6.
Stock Options
6.1 Grant of Options.
Subject to the terms and provisions of this Plan, Options may be
granted to Participants in such number, and upon such terms, and
at any time and from time to time as shall be determined by the
Committee, in its sole discretion; provided that ISOs may be
granted only to eligible
7
Employees of the Company or of any parent or subsidiary
corporation (as permitted under Code Sections 422 and 424).
6.2 Award Agreement. Each
Option grant shall be evidenced by an Award Agreement that shall
specify the Option Price, the maximum duration of the Option,
the number of Shares to which the Option pertains, the
conditions upon which an Option shall become vested and
exercisable, and such other provisions as the Committee shall
determine which are not inconsistent with the terms of this
Plan. The Award Agreement also shall specify whether the Option
is intended to be an ISO or a NQSO.
6.3 Option Price. The Option
Price for each grant of an Option under this Plan shall be
determined by the Committee in its sole discretion and shall be
specified in the Award Agreement; provided, however, the Option
Price must be at least equal to one hundred percent (100%) of
the FMV of the Shares as determined on the Grant Date.
6.4 Term of Options. Each
Option granted to a Participant shall expire at such time as the
Committee shall determine at the time of grant; provided,
however, no Option shall be exercisable later than the day
before the tenth (10th) anniversary date of its grant.
Notwithstanding the foregoing, for Nonqualified Stock Options
granted to Participants outside the United States, the Committee
has the authority to grant Nonqualified Stock Options that have
a term greater than ten (10) years.
6.5 Exercise of Options.
Options granted under this Article 6 shall be exercisable
at such times and be subject to such restrictions and conditions
as the Committee shall in each instance approve, which terms and
restrictions need not be the same for each grant or for each
Participant.
6.6 Payment. Options granted
under this Article 6 shall be exercised by the delivery of
a notice of exercise to the Company or an agent designated by
the Company in a form specified or accepted by the Committee, or
by complying with any alternative procedures which may be
authorized by the Committee, setting forth the number of Shares
with respect to which the Option is to be exercised, accompanied
by full payment for the Shares.
A condition of the issuance of the Shares as to which an Option
shall be exercised shall be the payment of the Option Price. The
Option Price of any Option shall be payable to the Company in
full either: (a) in cash or its equivalent; (b) by
tendering (either by actual delivery or attestation) previously
acquired Shares having an aggregate Fair Market Value at the
time of exercise equal to the Option Price (provided that except
as otherwise determined by the Committee, the Shares that are
tendered must have been held by the Participant for at least six
(6) months (or such other period, if any, as the Committee
may permit) prior to their tender to satisfy the Option Price if
acquired under this Plan or any other compensation plan
maintained by the Company or have been purchased on the open
market); (c) by a cashless (broker-assisted) exercise;
(d) by a combination of (a), (b) and/or (c); or
(e) any other method approved or accepted by the Committee
in its sole discretion.
Subject to any governing rules or regulations, as soon as
practicable after receipt of written notification of exercise
and full payment (including satisfaction of any applicable tax
withholding), the Company shall deliver to the Participant
evidence of book entry Shares, or upon the Participants
request, Share certificates in an appropriate amount based upon
the number of Shares purchased under the Option(s).
Unless otherwise determined by the Committee, all payments under
all of the methods indicated above shall be paid in United
States dollars.
6.7 Restrictions on Share
Transferability. The Committee may impose such restrictions
on any Shares acquired pursuant to the exercise of an Option
granted under this Article 6 as it may deem advisable,
including, without limitation, minimum holding period
requirements, restrictions under applicable federal securities
laws, under the requirements of any stock exchange or market
upon which such Shares are then listed and/or traded, or under
any blue sky or state securities laws applicable to such Shares.
6.8 Termination of
Employment. Each Participants Award Agreement shall
set forth the extent to which the Participant shall have the
right to exercise the Option following termination of the
Participants
8
employment or provision of services to the Company, its
Affiliates, and/or its Subsidiaries, as the case may be. Such
provisions shall be determined in the sole discretion of the
Committee, shall be included in the Award Agreement entered into
with each Participant, need not be uniform among all Options
issued pursuant to this Article 6, and may reflect
distinctions based on the reasons for termination.
6.9 Notification of
Disqualifying Disposition. If any Participant shall make any
disposition of Shares issued pursuant to the exercise of an ISO
under the circumstances described in Code Section 421(b)
(relating to certain disqualifying dispositions), such
Participant shall notify the Company of such disposition within
ten (10) calendar days thereof.
Article 7.
Stock Appreciation Rights
7.1 Grant of SARs. Subject
to the terms and conditions of this Plan, SARs may be granted to
Participants at any time and from time to time as shall be
determined by the Committee.
Subject to the terms and conditions of this Plan, the Committee
shall have complete discretion in determining the number of SARs
granted to each Participant and, consistent with the provisions
of this Plan, in determining the terms and conditions pertaining
to such SARs.
The Grant Price for each grant of a SAR shall be determined by
the Committee and shall be specified in the Award Agreement;
provided, however, the Grant Price on the Grant Date must be at
least equal to one hundred percent (100%) of the FMV of the
Shares as determined on the Grant Date.
7.2 SAR Agreement. Each SAR
Award shall be evidenced by an Award Agreement that shall
specify the Grant Price, the term of the SAR, and such other
provisions as the Committee shall determine.
7.3 Term of SAR. The term of
a SAR granted under this Plan shall be determined by the
Committee, in its sole discretion, and except as determined
otherwise by the Committee and specified in the SAR Award
Agreement, no SAR shall be exercisable later than the tenth
(10th) anniversary date of its grant. Notwithstanding the
foregoing, for SARs granted to Participants outside the United
States, the Committee has the authority to grant SARs that have
a term greater than ten (10) years.
7.4 Exercise of SARs. SARs
may be exercised upon whatever terms and conditions the
Committee, in its sole discretion, imposes.
7.5 Settlement of SARs. Upon
the exercise of a SAR, a Participant shall be entitled to
receive payment from the Company in an amount determined by
multiplying:
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(a) The excess of the Fair Market Value of a Share on the
date of exercise over the Grant Price; by |
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(b) The number of Shares with respect to which the SAR is
exercised. |
At the discretion of the Committee, the payment upon SAR
exercise may be in cash, Shares, or any combination thereof, or
in any other manner approved by the Committee in its sole
discretion. The Committees determination regarding the
form of SAR payout shall be set forth in the Award Agreement
pertaining to the grant of the SAR.
7.6 Termination of
Employment. Each Award Agreement shall set forth the extent
to which the Participant shall have the right to exercise the
SAR following termination of the Participants employment
with or provision of services to the Company, its Affiliates,
and/or its Subsidiaries, as the case may be. Such provisions
shall be determined in the sole discretion of the Committee,
shall be included in the Award Agreement entered into with
Participants, need not be uniform among all SARs issued pursuant
to this Plan, and may reflect distinctions based on the reasons
for termination.
7.7 Other Restrictions. The
Committee shall impose such other conditions and/or restrictions
on any Shares received upon exercise of a SAR granted pursuant
to this Plan as it may deem advisable or desirable. These
restrictions may include, but shall not be limited to, a
requirement that the Participant hold the Shares received upon
exercise of a SAR for a specified period of time.
9
Article 8.
Restricted Stock and Restricted Stock Units
8.1 Grant of Restricted Stock or
Restricted Stock Units. Subject to the terms and provisions
of this Plan or an Award Agreement, the Committee, at any time
and from time to time, may grant Shares of Restricted Stock
and/or Restricted Stock Units to Participants in such amounts as
the Committee shall determine. Restricted Stock Units shall be
similar to Restricted Stock except that no Shares are actually
awarded to the Participant on the Grant Date.
8.2 Restricted Stock or
Restricted Stock Unit Agreement. Each Restricted Stock
and/or Restricted Stock Unit grant shall be evidenced by an
Award Agreement that shall specify the Period(s) of Restriction,
the number of Shares of Restricted Stock or the number of
Restricted Stock Units granted, and such other provisions as the
Committee shall determine.
8.3 Other Restrictions. The
Committee shall impose such other conditions and/or restrictions
on any Shares of Restricted Stock or Restricted Stock Units
granted pursuant to this Plan as it may deem advisable
including, without limitation, a requirement that Participants
pay a stipulated purchase price for each Share of Restricted
Stock or each Restricted Stock Unit, restrictions based upon the
achievement of specific performance goals, time-based
restrictions on vesting following the attainment of the
performance goals, time-based restrictions, and/or restrictions
under applicable laws or under the requirements of any stock
exchange or market upon which such Shares are listed or traded,
or holding requirements or sale restrictions placed on the
Shares by the Company upon vesting of such Restricted Stock or
Restricted Stock Units.
To the extent deemed appropriate by the Committee, the Company
may retain the certificates representing Shares of Restricted
Stock in the Companys possession until such time as all
conditions and/or restrictions applicable to such Shares have
been satisfied or lapse.
Except as otherwise provided in this Article 8, Shares of
Restricted Stock covered by each Restricted Stock Award shall
become freely transferable by the Participant after all
conditions and restrictions applicable to such Shares have been
satisfied or lapse (including satisfaction of any applicable tax
withholding obligations), and Restricted Stock Units shall be
paid in cash, Shares, or a combination of cash and Shares as the
Committee, in its sole discretion shall determine.
8.4 Certificate Legend. In
addition to any legends placed on certificates pursuant to
Section 8.3, each certificate representing Shares of
Restricted Stock granted pursuant to this Plan may bear a legend
such as the following or as otherwise determined by the
Committee in its sole discretion:
The sale or transfer of the common shares of The Scotts
Miracle-Gro Company represented by this certificate, whether
voluntary, involuntary, or by operation of law, is subject to
certain restrictions on transfer as set forth in The Scotts
Miracle-Gro Company 2006 Long-Term Incentive Plan, and in the
associated Award Agreement. A copy of this Plan and such Award
Agreement will be provided by The Scotts Miracle-Gro Company,
without charge, within five (5) days after receipt of a
written request therefor.
8.5 Voting Rights. Unless
otherwise determined by the Committee and set forth in a
Participants Award Agreement, to the extent permitted or
required by law, as determined by the Committee, Participants
holding Shares of Restricted Stock granted hereunder may be
granted the right to exercise full voting rights with respect to
those Shares during the Period of Restriction. A Participant
shall have no voting rights with respect to any Restricted Stock
Units granted hereunder.
8.6 Termination of
Employment. Each Award Agreement shall set forth the extent
to which the Participant shall have the right to retain
Restricted Stock and/or Restricted Stock Units following
termination of the Participants employment with or
provision of services to the Company, its Affiliates, and/or its
Subsidiaries, as the case may be. Such provisions shall be
determined in the sole discretion of the Committee, shall be
included in the Award Agreement entered into with each
Participant, need not be uniform among all Shares of Restricted
Stock or Restricted Stock Units issued pursuant to this Plan,
and may reflect distinctions based on the reasons for
termination.
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8.7 Section 83(b)
Election. The Committee may provide in an Award Agreement
that the Award of Restricted Stock is conditioned upon the
Participant making or refraining from making an election with
respect to the Award under Code Section 83(b). If a
Participant makes an election pursuant to Code
Section 83(b) concerning a Restricted Stock Award, the
Participant shall be required to file promptly a copy of such
election with the Company.
Article 9.
Performance Units/ Performance Shares
9.1 Grant of Performance Units/
Performance Shares. Subject to the terms and provisions of
this Plan, the Committee, at any time and from time to time, may
grant Performance Units and/or Performance Shares to
Participants in such amounts and upon such terms as the
Committee shall determine.
9.2 Value of Performance Units/
Performance Shares. Each Performance Unit shall have an
initial value that is established by the Committee at the time
of grant. Each Performance Share shall have an initial value
equal to the Fair Market Value of a Share on the Grant Date. The
Committee shall set performance goals in its discretion which,
depending on the extent to which they are met, will determine
the value and/or number of Performance Units/ Performance Shares
that will be paid out to the Participant.
9.3 Earning of Performance
Units/ Performance Shares. Subject to the terms of this
Plan, after the applicable Performance Period has ended, the
holder of Performance Units/ Performance Shares shall be
entitled to receive payout on the value and number of
Performance Units/ Performance Shares earned by the Participant
over the Performance Period, to be determined as a function of
the extent to which the corresponding performance goals have
been achieved.
9.4 Form and Timing of Payment
of Performance Units/ Performance Shares. Payment of earned
Performance Units/ Performance Shares shall be as determined by
the Committee and as evidenced in the Award Agreement. Subject
to the terms of this Plan, the Committee, in its sole
discretion, may pay earned Performance Units/ Performance Shares
in the form of cash or in Shares (or in a combination thereof)
equal to the value of the earned Performance Units/ Performance
Shares at the close of the applicable Performance Period, or as
soon as practicable after the end of the Performance Period. Any
Shares may be granted subject to any restrictions deemed
appropriate by the Committee. The determination of the Committee
with respect to the form of payout of such Awards shall be set
forth in the Award Agreement pertaining to the grant of the
Award.
9.5 Termination of
Employment. Each Award Agreement shall set forth the extent
to which the Participant shall have the right to retain
Performance Units and/or Performance Shares following
termination of the Participants employment with or
provision of services to the Company, its Affiliates, and/or its
Subsidiaries, as the case may be. Such provisions shall be
determined in the sole discretion of the Committee, shall be
included in the Award Agreement entered into with each
Participant, need not be uniform among all Awards of Performance
Units or Performance Shares issued pursuant to this Plan, and
may reflect distinctions based on the reasons for termination.
Article 10.
Cash-Based Awards and Other Stock-Based Awards
10.1 Grant of Cash-Based
Awards. Subject to the terms and provisions of the Plan, the
Committee, at any time and from time to time, may grant
Cash-Based Awards to Participants in such amounts and upon such
terms as the Committee may determine.
10.2 Other Stock-Based
Awards. The Committee may grant other types of equity-based
or equity-related Awards not otherwise described by the terms of
this Plan (including the grant or offer for sale of unrestricted
Shares) in such amounts and subject to such terms and
conditions, as the Committee shall determine. Such Awards may
involve the transfer of actual Shares to Participants, or
payment in cash or
11
otherwise of amounts based on the value of Shares and may
include, without limitation, Awards designed to comply with or
take advantage of the applicable local laws of jurisdictions
other than the United States.
10.3 Value of Cash-Based and
Other Stock-Based Awards. Each Cash-Based Award shall
specify a payment amount or payment range as determined by the
Committee. Each Other Stock-Based Award shall be expressed in
terms of Shares or units based on Shares, as determined by the
Committee. The Committee may establish performance goals in its
discretion. If the Committee exercises its discretion to
establish performance goals, the number and/or value of
Cash-Based Awards or Other Stock-Based Awards that will be paid
out to the Participant will depend on the extent to which the
performance goals are met.
10.4 Payment of Cash-Based
Awards and Other Stock-Based Awards. Payment, if any, with
respect to a Cash-Based Award or an Other Stock-Based Award
shall be made in accordance with the terms of the Award, in cash
or Shares as the Committee determines.
10.5 Termination of
Employment. The Committee shall determine the extent to
which the Participant shall have the right to receive Cash-Based
Awards or Other Stock-Based Awards following termination of the
Participants employment with or provision of services to
the Company, its Affiliates, and/or its Subsidiaries, as the
case may be. Such provisions shall be determined in the sole
discretion of the Committee, such provisions may be included in
an agreement entered into with each Participant, but need not be
uniform among all Awards of Cash-Based Awards or Other
Stock-Based Awards issued pursuant to the Plan, and may reflect
distinctions based on the reasons for termination.
Article 11.
Transferability of Awards
11.1 Transferability. Except
as provided in Section 11.2 below, during a
Participants lifetime, his or her Awards shall be
exercisable only by the Participant or the Participants
legal representative. Awards shall not be transferable other
than by will or the laws of descent and distribution; no Awards
shall be subject, in whole or in part, to attachment, execution,
or levy of any kind; and any purported transfer in violation
hereof shall be null and void. The Committee may establish such
procedures as it deems appropriate for a Participant to
designate a beneficiary to whom any amounts payable or Shares
deliverable in the event of, or following, the
Participants death, may be provided.
11.2 Committee Action. The
Committee may, in its discretion, determine that notwithstanding
Section 11.1, any or all Awards (other than ISOs) shall be
transferable to and exercisable by such transferees, and subject
to such terms and conditions, as the Committee may deem
appropriate; provided, however, no Award may be transferred for
value (as defined in the General Instructions to Form S-8).
Article 12.
Performance Measures
12.1 Performance Measures.
The performance goals upon which the payment or vesting of an
Award to a Covered Employee that is intended to qualify as
Performance-Based Compensation shall be limited to the following
Performance Measures:
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(a) Net earnings or net income (before or after taxes); |
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(b) Earnings per share (basic or diluted); |
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(c) Net sales or revenue growth; |
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(d) Net operating profit; |
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(e) Return measures (including, but not limited to, return
on assets, capital, invested capital, equity, sales, or revenue); |
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(f) Cash flow (including, but not limited to, operating
cash flow, free cash flow, cash flow return on equity, and cash
flow return on investment); |
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(g) Earnings before or after taxes, interest, depreciation,
and/or amortization; |
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(h) Gross or operating margins; |
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(i) Productivity ratios; |
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(j) Share price (including, but not limited to, growth
measures and total shareholder return); |
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(k) Expense targets; |
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(l) Margins; |
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(m) Operating efficiency; |
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(n) Market share; |
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(o) Customer satisfaction; |
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(p) Working capital targets; |
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(q) Economic value added or EVA® (net operating profit
after tax minus the sum of capital multiplied by the cost of
capital); |
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(r) Developing new products and lines of revenue; |
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(s) Reducing operating expenses; |
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(t) Developing new markets; |
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(u) Meeting completion schedules |
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(v) Developing and managing relationships with regulatory
and other governmental agencies; |
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(w) Managing cash; |
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(x) Managing claims against the Company, including
litigation; |
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(y) Identifying and completing strategic
acquisitions; and |
Any Performance Measure(s) may be used to measure the
performance of the Company, Subsidiary, and/or Affiliate as a
whole or any business unit of the Company, Subsidiary, and/or
Affiliate or any combination thereof, as the Committee may deem
appropriate, or any of the above Performance Measures as
compared to the performance of a group of comparator companies,
or published or special index that the Committee, in its sole
discretion, deems appropriate, or the Committee may select
Performance Measure (j) above as compared to various stock
market indices. The Committee also has the authority to provide
for accelerated vesting of any Award based on the achievement of
performance goals pursuant to the Performance Measures specified
in this Article 12.
12.2 Evaluation of
Performance. The Committee may provide in any such Award
that any evaluation of performance may include or exclude any of
the following events that occurs during a Performance Period:
(a) asset write-downs, (b) litigation or claim
judgments or settlements, (c) the effect of changes in tax
laws, accounting principles, or other laws or provisions
affecting reported results, (d) any reorganization and
restructuring programs, (e) extraordinary nonrecurring
items as described in Accounting Principles Board Opinion
No. 30 and/or in managements discussion and analysis
of financial condition and results of operations appearing in
the Companys annual report to shareholders for the
applicable year, (f) acquisitions or divestitures, and
(g) foreign exchange gains and losses. To the extent such
inclusions or exclusions affect Awards to Covered Employees,
they shall be prescribed in a form that meets the requirements
of Code Section 162(m) for deductibility.
12.3 Adjustment of
Performance-Based Compensation. Awards that are intended to
qualify as Performance-Based Compensation may not be adjusted
upward. The Committee shall retain the discretion to adjust such
Awards downward, either on a formula or discretionary basis or
any combination, as the Committee determines.
12.4 Committee Discretion.
In the event that applicable tax and/or securities laws change
to permit Committee discretion to alter the governing
Performance Measures without obtaining shareholder approval of
such changes, the Committee shall have sole discretion to make
such changes without obtaining
13
shareholder approval. In addition, in the event that the
Committee determines that it is advisable to grant Awards that
shall not qualify as Performance-Based Compensation, the
Committee may make such grants without satisfying the
requirements of Code Section 162(m) and base vesting on
Performance Measures other than those set forth in
Section 12.1.
Article 13.
Nonemployee Director Awards
The Board shall determine all Awards to Nonemployee Directors.
The terms and conditions of any grant to any such Nonemployee
Director shall be set forth in an Award Agreement.
Article 14.
Dividend Equivalents
Any Participant selected by the Committee may be granted
dividend equivalents based on the dividends declared on Shares
that are subject to any Award, to be credited as of dividend
payment dates, during the period between the date the Award is
granted and the date the Award is exercised, vests or expires,
as determined by the Committee. Such dividend equivalents shall
be converted to cash or additional Shares by such formula and at
such time and subject to such limitations as may be determined
by the Committee.
Article 15.
Beneficiary Designation
Each Participant under this Plan may, from time to time, name
any beneficiary or beneficiaries (who may be named contingently
or successively) to whom any benefit under this Plan is to be
paid in case of his death before he receives any or all of such
benefit. Each such designation shall revoke all prior
designations by the same Participant, shall be in a form
prescribed by the Committee, and will be effective only when
filed by the Participant in writing with the Company during the
Participants lifetime. In the absence of any such
beneficiary designation, benefits remaining unpaid or rights
remaining unexercised at the Participants death shall be
paid to or exercised by the Participants spouse, executor,
administrator, or legal representative.
Article 16.
Rights of Participants
16.1 Employment. Nothing in
this Plan or an Award Agreement shall interfere with or limit in
any way the right of the Company, its Affiliates, and/or its
Subsidiaries, to terminate any Participants employment or
service on the Board or to the Company at any time or for any
reason not prohibited by law, nor confer upon any Participant
any right to continue his employment or service as a Director or
Third Party Service Provider for any specified period of time.
Neither an Award nor any benefits arising under this Plan shall
constitute an employment contract with the Company, its
Affiliates, and/or its Subsidiaries and, accordingly, subject to
Articles 3 and 18, this Plan and the benefits
hereunder may be terminated at any time in the sole and
exclusive discretion of the Committee without giving rise to any
liability on the part of the Company, its Affiliates, and/or its
Subsidiaries.
16.2 Participation. No
individual shall have the right to be selected to receive an
Award under this Plan, or, having been so selected, to be
selected to receive a future Award.
16.3 Rights as a
Shareholder. Except as otherwise provided herein, a
Participant shall have none of the rights of a shareholder with
respect to Shares covered by any Award until the Participant
becomes the record holder of such Shares.
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Article 17.
Change of Control
17.1 Accelerated Vesting and
Settlement. Subject to Section 17.2, on the date of any
Change in Control:
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(a) Each Option and SAR (other than Options and SARs of
Nonemployee Directors) outstanding on the date of a Change in
Control (whether or not exercisable) will be cancelled in
exchange (i) for cash equal to the excess of the Change in
Control Price over the Exercise Price or Grant Price, as
applicable, associated with the cancelled Option or SAR or,
(ii) at the Committees discretion, for whole Shares
with a Fair Market Value equal to the excess of the Change in
Control Price over the Exercise Price or Grant Price, as
applicable, associated with the cancelled Option or SAR and the
Fair Market Value of any fractional Share will be distributed in
cash. However, the Committee, in its sole discretion, may offer
the holders of the Options or SARs to be cancelled a reasonable
opportunity (not longer than 15 days beginning on the date
of the Change in Control) to exercise all their outstanding
Options and SARs (whether or not otherwise then exercisable); |
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(b) All performance goals associated with Awards for which
performance goals have been established will be deemed to have
been met on the date of the Change in Control, all Performance
Periods accelerated to the date of the Change in Control and all
outstanding Awards for which performance goals have been
established (including those subject to the acceleration
described in this subsection) will be distributed in a single
lump sum cash payment; and |
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(c) All other then-outstanding Awards whose exercisability
depends merely on the satisfaction of a service obligation by a
Participant to the Company, Subsidiary, or Affiliate
(Service Award) shall vest in full and be free of
restrictions related to the vesting of such Awards. All Service
Awards whose vesting is so accelerated will be distributed, if
not already held by a Participant, (i) in a single lump-sum
cash payment based on the Change in Control Price or,
(ii) at the Committees discretion, in the form of
whole Shares based on the Change in Control Price. |
17.2 Alternative Awards.
Section 17.1 will not apply to the extent that the
Committee reasonably concludes in good faith before the Change
in Control occurs that Awards will be honored or assumed or new
rights substituted for the Award (collectively,
Alternative Awards) by the Employees employer
(or the parent or a subsidiary of that employer) immediately
after the Change in Control, provided that any Alternative Award
must:
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(a) Be based on stock that is (or, within 60 days of
the Change in Control, will be) traded on an established
securities market; |
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(b) Provide the Employee rights and entitlements
substantially equivalent to or better than the rights, terms and
conditions of each Award for which it is substituted, including
an identical or better exercise or vesting schedule and
identical or better timing and methods of payment; |
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(c) Have substantially equivalent economic value to the
Award (determined at the time of the Change in Control) for
which it is substituted; and |
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(d) Provide that, if the Employees employment is
involuntarily terminated without cause or constructively
terminated by the Employee, any conditions on the
Employees rights under, or any restrictions on transfer or
exercisability applicable to, each Alternative Award will be
waived or lapse. |
For purposes of this section, a constructive termination means a
termination by an Employee following a material reduction in the
Employees compensation or job responsibilities (when
compared to the Employees compensation and job
responsibilities on the date of the Change in Control) or the
relocation of the Employees principal place of employment
to a location at least fifty (50) miles from his or her
principal place of employment on the date of the Change in
Control (or other location to which the Employee has been
reassigned with his or her written consent), in each case
without the Employees written consent.
15
17.3 Nonemployee Directors
Awards. Upon a Change in Control, each outstanding:
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(a) Option or SAR held by a Nonemployee Director will be
cancelled unless (a) the Shares continue to be traded on an
established securities market after the Change in Control, or
(b) the Nonemployee Director continues to be a Board member
after the Change in Control. In the situations just described,
the Options or SARs held by a Nonemployee Director will be
unaffected by a Change in Control. Any Options and SARs held by
a Nonemployee Director to be cancelled under the next preceding
sentence will be exchanged (c) for cash equal to the excess
of the Change in Control Price over the Exercise Price or Grant
Price, as applicable, associated with the cancelled Option or
SAR held by a Nonemployee Director, or (d) at the
Boards discretion, for whole Shares with a Fair Market
Value equal to the excess of the Change in Control Price over
the Exercise Price associated with the cancelled Option or SAR
held by a Nonemployee Director and the Fair Market Value of any
fractional Share will be distributed in cash. However, the
Board, in its sole discretion, may offer Nonemployee Directors
holding Options or SARs to be cancelled a reasonable opportunity
(not longer than 15 days beginning on the date of the
Change in Control) to exercise all their outstanding Options and
SARs (whether or not otherwise then exercisable). |
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(b) Restricted Stock or Restricted Stock Unit held by a
Nonemployee Director will be settled for a lump sum cash payment
equal to the Change in Control Price. |
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(c) All other types of Awards held by Nonemployee Directors
will be settled for a lump sum cash payment equal to the Change
in Control Price less any amount a Nonemployee Director would be
required to pay in order for the Award to be exercised or
settled, other than any such amount related to taxes. |
Article 18.
Amendment, Modification, Suspension, and Termination
18.1 Amendment, Modification,
Suspension, and Termination. Subject to Section 18.3,
the Committee may, at any time and from time to time, alter,
amend, modify, suspend, or terminate this Plan and any Award
Agreement in whole or in part; provided, however, that, without
the prior approval of the Companys shareholders and except
as provided in Section 4.4, Options or SARs issued under
this Plan will not be repriced, replaced, or regranted through
cancellation, or by lowering the Option Price of a previously
granted Option or the Grant Price of a previously granted SAR,
and no material amendment of this Plan shall be made without
shareholder approval if shareholder approval is required by law,
regulation, or stock exchange rule.
18.2 Adjustment of Awards Upon
the Occurrence of Certain Unusual or Nonrecurring Events.
The Committee may make adjustments in the terms and conditions
of, and the criteria included in, Awards in recognition of
unusual or nonrecurring events (including, without limitation,
the events described in Section 4.4 hereof) affecting the
Company or the financial statements of the Company or of changes
in applicable laws, regulations, or accounting principles,
whenever the Committee determines that such adjustments are
appropriate in order to prevent unintended dilution or
enlargement of the benefits or potential benefits intended to be
made available under this Plan. The determination of the
Committee as to the foregoing adjustments, if any, shall be
conclusive and binding on Participants under this Plan.
18.3 Awards Previously
Granted. Notwithstanding any other provision of this Plan to
the contrary (other than Section 18.4), no termination,
amendment, suspension, or modification of this Plan or an Award
Agreement shall adversely affect in any material way any Award
previously granted under this Plan, without the written consent
of the Participant holding such Award.
18.4 Amendment to Conform to
Law. Notwithstanding any other provision of this Plan to the
contrary, the Board may amend the Plan or an Award Agreement, to
take effect retroactively or otherwise, as deemed necessary or
advisable for the purpose of conforming the Plan or an Award
Agreement to any present or future law relating to plans of this
or similar nature (including, but not limited to, Code
Section 409A), and to the administrative regulations and
rulings promulgated thereunder. By accepting an
16
Award under this Plan, each Participant agrees to any amendment
made pursuant to this Section 18.4 to any Award granted
under the Plan without further consideration or action.
Article 19.
Withholding
19.1 Tax Withholding. The
Company shall have the power and the right to deduct or
withhold, or require a Participant to remit to the Company, the
minimum statutory amount to satisfy federal, state, and local
taxes, domestic or foreign, required by law or regulation to be
withheld with respect to any taxable event arising as a result
of this Plan.
19.2 Share Withholding. With
respect to withholding required upon the exercise of Options or
SARs, upon the lapse of restrictions on Restricted Stock and
Restricted Stock Units, or upon the achievement of performance
goals related to Performance Shares, or any other taxable event
arising as a result of an Award granted hereunder, Participants
may elect, subject to the approval of the Committee, to satisfy
the withholding requirement, in whole or in part, by having the
Company withhold Shares having a Fair Market Value on the date
the tax is to be determined equal to the minimum statutory total
tax that could be imposed on the transaction. All such elections
shall be irrevocable, made in writing, and signed by the
Participant, and shall be subject to any restrictions or
limitations that the Committee, in its sole discretion, deems
appropriate.
Article 20.
Successors
All obligations of the Company under this Plan with respect to
Awards granted hereunder shall be binding on any successor to
the Company, whether the existence of such successor is the
result of a direct or indirect purchase, merger, consolidation,
or otherwise, of all or substantially all of the business and/or
assets of the Company.
Article 21.
General Provisions
21.1 Forfeiture Events.
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(a) The Committee may specify in an Award Agreement that
the Participants rights, payments, and benefits with
respect to an Award shall be subject to reduction, cancellation,
forfeiture, or recoupment upon the occurrence of certain
specified events, in addition to any otherwise applicable
vesting or performance conditions of an Award. Such events may
include, but shall not be limited to, termination of employment
for cause, termination of the Participants provision of
services to the Company, Affiliate, and/or Subsidiary, violation
of material Company, Affiliate, and/or Subsidiary policies,
breach of noncompetition, confidentiality, or other restrictive
covenants that may apply to the Participant, or other conduct by
the Participant that is detrimental to the business or
reputation of the Company, its Affiliates, and/or its
Subsidiaries. |
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(b) If the Company is required to prepare an accounting
restatement due to the material noncompliance of the Company, as
a result of misconduct, with any financial reporting requirement
under the securities laws, if the Participant knowingly or
grossly negligently engaged in the misconduct, or knowingly or
grossly negligently failed to prevent the misconduct, or if the
Participant is one of the individuals subject to automatic
forfeiture under Section 304 of the Sarbanes-Oxley Act of
2002, the Participant shall reimburse the Company the amount of
any payment in settlement of an Award earned or accrued during
the twelve- (12-) month period following the first public
issuance or filing with the United States Securities and
Exchange Commission (whichever just occurred) of the financial
document embodying such financial reporting requirement. |
21.2 Legend. The
certificates for Shares may include any legend which the
Committee deems appropriate to reflect any restrictions on
transfer of such Shares.
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21.3 Gender and Number.
Except where otherwise indicated by the context, any masculine
term used herein also shall include the feminine, the plural
shall include the singular, and the singular shall include the
plural.
21.4 Severability. In the
event any provision of this Plan shall be held illegal or
invalid for any reason, the illegality or invalidity shall not
affect the remaining parts of this Plan, and this Plan shall be
construed and enforced as if the illegal or invalid provision
had not been included.
21.5 Requirements of Law.
The granting of Awards and the issuance of Shares under this
Plan shall be subject to all applicable laws, rules, and
regulations, and to such approvals by any governmental agencies
or stock exchange as may be required.
21.6 Delivery of Title. The
Company shall have no obligation to issue or deliver evidence of
title for Shares issued under this Plan prior to:
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(a) Obtaining any approvals from governmental agencies that
the Company determines are necessary or advisable; and |
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(b) Completion of any registration or other qualification
of the Shares under any applicable national or foreign law or
ruling of any governmental body that the Company determines to
be necessary or advisable. |
21.7 Inability to Obtain
Authority. The inability of the Company to obtain authority
from any regulatory body having jurisdiction, which authority is
deemed by the Companys counsel to be necessary to the
lawful issuance and sale of any Shares hereunder, shall relieve
the Company of any liability in respect of the failure to issue
or sell such Shares as to which such requisite authority shall
not have been obtained.
21.8 Investment
Representations. The Committee may require any individual
receiving Shares pursuant to an Award under this Plan to
represent and warrant in writing that the individual is
acquiring the Shares for investment and without any present
intention to sell or distribute such Shares.
21.9 Employees Based Outside of
the United States. Notwithstanding any provision of this
Plan to the contrary, in order to comply with the laws in other
countries in which the Company, its Affiliates, and/or its
Subsidiaries operate or have Employees, Directors, or Third
Party Service Providers, the Committee, in its sole discretion,
shall have the power and authority to:
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(a) Determine which Affiliates and Subsidiaries shall be
covered by this Plan; |
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(b) Determine which Employees, Directors, and/or Third
Party Service Providers outside the United States are eligible
to participate in this Plan; |
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(c) Modify the terms and conditions of any Award granted to
Employees and/or Third Party Service Providers outside the
United States to comply with applicable foreign laws; |
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(d) Establish subplans and modify exercise procedures and
other terms and procedures, to the extent such actions may be
necessary or advisable. Any subplans and modifications to Plan
terms and procedures established under this Section 21.9 by
the Committee shall be attached to this Plan document as
appendices; and |
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(e) Take any action, before or after an Award is made, that
it deems advisable to obtain approval or comply with any
necessary local government regulatory exemptions or approvals. |
Notwithstanding the above, the Committee may not take any
actions hereunder, and no Awards shall be granted, that would
violate applicable law.
21.10 Uncertificated Shares.
To the extent that this Plan provides for issuance of
certificates to reflect the transfer of Shares, the transfer of
such Shares may be effected on a noncertificated basis, to the
extent not prohibited by applicable law or the rules of any
stock exchange.
21.11 Unfunded Plan.
Participants shall have no right, title, or interest whatsoever
in or to any investments that the Company, and/or its
Subsidiaries, and/or its Affiliates may make to aid it in
meeting its obligations under this Plan. Nothing contained in
this Plan, and no action taken pursuant to its
18
provisions, shall create or be construed to create a trust of
any kind, or a fiduciary relationship between the Company and
any Participant, beneficiary, legal representative, or any other
individual. To the extent that any individual acquires a right
to receive payments from the Company, its Subsidiaries, and/or
its Affiliates under this Plan, such right shall be no greater
than the right of an unsecured general creditor of the Company,
a Subsidiary, or an Affiliate, as the case may be. All payments
to be made hereunder shall be paid from the general funds of the
Company, a Subsidiary, or an Affiliate, as the case may be and
no special or separate fund shall be established and no
segregation of assets shall be made to assure payment of such
amounts except as expressly set forth in this Plan.
21.12 No Fractional Shares.
No fractional Shares shall be issued or delivered pursuant to
this Plan or any Award. The Committee shall determine whether
cash, Awards, or other property shall be issued or paid in lieu
of fractional Shares or whether such fractional Shares or any
rights thereto shall be forfeited or otherwise eliminated.
21.13 Retirement and Welfare
Plans. Neither Awards made under this Plan nor Shares or
cash paid pursuant to such Awards may be included as
compensation for purposes of computing the benefits
payable to any Participant under the Companys or any
Subsidiarys or Affiliates retirement plans (both
qualified and non-qualified) or welfare benefit plans unless
such other plan expressly provides that such compensation shall
be taken into account in computing a Participants benefit.
21.14 Deferred Compensation.
No deferral of compensation (as defined under Code
Section 409A or guidance thereto) is intended under this
Plan. Notwithstanding this intent, if any Award would be
considered deferred compensation as defined under Code
Section 409A and if this Plan fails to meet the
requirements of Code Section 409A with respect to such
Award, then such Award shall be null and void. However, the
Committee may permit deferrals of compensation pursuant to the
terms of a Participants Award Agreement, a separate plan
or a subplan which meets the requirements of Code
Section 409A and any related guidance. Additionally, to the
extent any Award is subject to Code Section 409A,
notwithstanding any provision herein to the contrary, the Plan
does not permit the acceleration or delay of the time or
schedule of any distribution related to such Award, except as
permitted by Code Section 409A, the regulations thereunder,
and/or the Secretary of the United States Treasury.
21.15 Nonexclusivity of this
Plan. The adoption of this Plan shall not be construed as
creating any limitations on the power of the Board or Committee
to adopt such other compensation arrangements as it may deem
desirable for any Participant.
21.16 No Constraint on Corporate
Action. Nothing in this Plan shall be construed to:
(i) limit, impair, or otherwise affect the Companys
or a Subsidiarys or an Affiliates right or power to
make adjustments, reclassifications, reorganizations, or changes
of its capital or business structure, or to merge or
consolidate, or dissolve, liquidate, sell, or transfer all or
any part of its business or assets; or, (ii) limit the
right or power of the Company or a Subsidiary or an Affiliate to
take any action which such entity deems to be necessary or
appropriate.
21.17 Governing Law. The
Plan and each Award Agreement shall be governed by the laws of
the State of Ohio, excluding any conflicts or choice of law rule
or principle that might otherwise refer construction or
interpretation of this Plan to the substantive law of another
jurisdiction. Unless otherwise provided in the Award Agreement,
recipients of an Award under this Plan are deemed to submit to
the exclusive jurisdiction and venue of the federal or state
courts of Ohio, to resolve any and all issues that may arise out
of or relate to this Plan or any related Award Agreement.
21.18 Indemnification.
Subject to requirements of Ohio law, each individual who is or
shall have been a member of the Board, or a Committee appointed
by the Board, or an officer of the Company to whom authority was
delegated in accordance with Article 3, shall be
indemnified and held harmless by the Company against and from
any loss, cost, liability, or expense that may be imposed upon
or reasonably incurred by him or her in connection with or
resulting from any claim, action, suit, or proceeding to which
he or she may be a party or in which he or she may be involved
by reason of any action taken or failure to act under this Plan
and against and from any and all amounts paid by him or her in
settlement thereof, with the Companys approval, or paid by
him or her in satisfaction of any judgment in any such action,
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suit, or proceeding against him or her, provided he or she shall
give the Company an opportunity, at its own expense, to handle
and defend the same before he or she undertakes to handle and
defend it on his/her own behalf, unless such loss, cost,
liability, or expense is a result of his/her own willful
misconduct or except as expressly provided by statute.
The foregoing right of indemnification shall not be exclusive of
any other rights of indemnification to which such individuals
may be entitled under the Companys Articles of
Incorporation or Code of Regulations, as a matter of law, or
otherwise, or any power that the Company may have to indemnify
them or hold them harmless.
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Exhibit 23.1
Exhibit 23.1
CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
We consent to the incorporation by reference in this Registration Statement on Form S-8 of our
reports dated December 14, 2005, relating to the financial statements and financial statement
schedule of The Scotts Miracle-Gro Company, and managements report on the effectiveness of
internal control over financial reporting appearing in the Annual Report on Form 10-K of The Scotts
Miracle-Gro Company for the year ended September 30, 2005.
/s/
Deloitte & Touche LLP
Columbus, Ohio
January 30, 2006
Exhibit 23.2
Exhibit 23.2
CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
We hereby consent to the incorporation by reference in this Registration Statement on Form S-8 of
our reports dated November 22, 2004 relating to the financial statements and financial statement
schedule of The Scotts Miracle-Gro Company, which appear in The Scotts Miracle-Gro Companys
Annual Report on Form 10-K for the year ended September 30, 2005.
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/s/ PricewaterhouseCoopers LLP |
Columbus, Ohio |
January 31, 2006 |
Exhibit 24.1
EXHIBIT 24.1
POWERS OF ATTORNEY
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned director of THE SCOTTS MIRACLE-GRO
COMPANY, an Ohio corporation, which is about to file with the Securities and Exchange Commission,
Washington, D.C., under the provisions of the Securities Act of 1933, as amended, a Registration
Statement on Form S-8 for the registration of certain of its common shares for offering and sale
pursuant to The Scotts Miracle-Gro Company 2006 Long-Term Incentive Plan, hereby constitutes and
appoints James Hagedorn, David M. Aronowitz and Christopher L. Nagel, and each of them, as his true
and lawful attorneys-in-fact and agents with full power of substitution and resubstitution, for him
and in his name, place and stead, in any and all capacities, to sign such Registration Statement
and any and all amendments thereto, and to file the same, with all exhibits thereto, and other
documents in connection therewith, with the Securities and Exchange Commission and the New York
Stock Exchange, granting unto each of said attorneys-in-fact and agents, and substitute or
substitutes, full power and authority to do and perform each and every act and thing requisite and
necessary to be done in and about the premises, as fully to all intents and purposes as he might or
could do in person, hereby ratifying and confirming all things that each of said attorneys-in-fact
and agents, or his or their substitute or substitutes, may lawfully do or cause to be done by
virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his hand this 26th day
of January, 2006.
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/s/ Mark R. Baker
Mark R. Baker
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POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned director of THE SCOTTS MIRACLE-GRO
COMPANY, an Ohio corporation, which is about to file with the Securities and Exchange Commission,
Washington, D.C., under the provisions of the Securities Act of 1933, as amended, a Registration
Statement on Form S-8 for the registration of certain of its common shares for offering and sale
pursuant to The Scotts Miracle-Gro Company 2006 Long-Term Incentive Plan, hereby constitutes and
appoints James Hagedorn, David M. Aronowitz and Christopher L. Nagel, and each of them, as his true
and lawful attorneys-in-fact and agents with full power of substitution and resubstitution, for him
and in his name, place and stead, in any and all capacities, to sign such Registration Statement
and any and all amendments thereto, and to file the same, with all exhibits thereto, and other
documents in connection therewith, with the Securities and Exchange Commission and the New York
Stock Exchange, granting unto each of said attorneys-in-fact and agents, and substitute or
substitutes, full power and authority to do and perform each and every act and thing requisite and
necessary to be done in and about the premises, as fully to all intents and purposes as he might or
could do in person, hereby ratifying and confirming all things that each of said attorneys-in-fact
and agents, or his or their substitute or substitutes, may lawfully do or cause to be done by
virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his hand this 26th day of
January, 2006.
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/s/ Gordon F. Brunner
Gordon F. Brunner
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POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned director of THE SCOTTS MIRACLE-GRO
COMPANY, an Ohio corporation, which is about to file with the Securities and Exchange Commission,
Washington, D.C., under the provisions of the Securities Act of 1933, as amended, a Registration
Statement on Form S-8 for the registration of certain of its common shares for offering and sale
pursuant to The Scotts Miracle-Gro Company 2006 Long-Term Incentive Plan, hereby constitutes and
appoints James Hagedorn, David M. Aronowitz and Christopher L. Nagel, and each of them, as his true
and lawful attorneys-in-fact and agents with full power of substitution and resubstitution, for him
and in his name, place and stead, in any and all capacities, to sign such Registration Statement
and any and all amendments thereto, and to file the same, with all exhibits thereto, and other
documents in connection therewith, with the Securities and Exchange Commission and the New York
Stock Exchange, granting unto each of said attorneys-in-fact and agents, and substitute or
substitutes, full power and authority to do and perform each and every act and thing requisite and
necessary to be done in and about the premises, as fully to all intents and purposes as he might or
could do in person, hereby ratifying and confirming all things that each of said attorneys-in-fact
and agents, or his or their substitute or substitutes, may lawfully do or cause to be done by
virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his hand this 26th day
of January, 2006.
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/s/ Arnold W. Donald
Arnold W. Donald
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POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned director of THE SCOTTS MIRACLE-GRO
COMPANY, an Ohio corporation, which is about to file with the Securities and Exchange Commission,
Washington, D.C., under the provisions of the Securities Act of 1933, as amended, a Registration
Statement on Form S-8 for the registration of certain of its common shares for offering and sale
pursuant to The Scotts Miracle-Gro Company 2006 Long-Term Incentive Plan, hereby constitutes and
appoints James Hagedorn, David M. Aronowitz and Christopher L. Nagel, and each of them, as his true
and lawful attorneys-in-fact and agents with full power of substitution and resubstitution, for him
and in his name, place and stead, in any and all capacities, to sign such Registration Statement
and any and all amendments thereto, and to file the same, with all exhibits thereto, and other
documents in connection therewith, with the Securities and Exchange Commission and the New York
Stock Exchange, granting unto each of said attorneys-in-fact and agents, and substitute or
substitutes, full power and authority to do and perform each and every act and thing requisite and
necessary to be done in and about the premises, as fully to all intents and purposes as he might or
could do in person, hereby ratifying and confirming all things that each of said attorneys-in-fact
and agents, or his or their substitute or substitutes, may lawfully do or cause to be done by
virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his hand this 26th
day of January, 2006.
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/s/ Joseph P. Flannery
Joseph P. Flannery
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POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned director of THE SCOTTS MIRACLE-GRO
COMPANY, an Ohio corporation, which is about to file with the Securities and Exchange Commission,
Washington, D.C., under the provisions of the Securities Act of 1933, as amended, a Registration
Statement on Form S-8 for the registration of certain of its common shares for offering and sale
pursuant to The Scotts Miracle-Gro Company 2006 Long-Term Incentive Plan, hereby constitutes and
appoints James Hagedorn, David M. Aronowitz and Christopher L. Nagel, and each of them, as her true
and lawful attorneys-in-fact and agents with full power of substitution and resubstitution, for her
and in her name, place and stead, in any and all capacities, to sign such Registration Statement
and any and all amendments thereto, and to file the same, with all exhibits thereto, and other
documents in connection therewith, with the Securities and Exchange Commission and the New York
Stock Exchange, granting unto each of said attorneys-in-fact and agents, and substitute or
substitutes, full power and authority to do and perform each and every act and thing requisite and
necessary to be done in and about the premises, as fully to all intents and purposes as she might
or could do in person, hereby ratifying and confirming all things that each of said
attorneys-in-fact and agents, or his or their substitute or substitutes, may lawfully do or cause
to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set her hand this 26th day
of January, 2006.
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/s/ Mindy F. Grossman
Mindy F. Grossman
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POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned officer and director of THE SCOTTS
MIRACLE-GRO COMPANY, an Ohio corporation, which is about to file with the Securities and Exchange
Commission, Washington, D.C., under the provisions of the Securities Act of 1933, as amended, a
Registration Statement on Form S-8 for the registration of certain of its common shares for
offering and sale pursuant to The Scotts Miracle-Gro Company 2006 Long-Term Incentive Plan, hereby
constitutes and appoints David M. Aronowitz and Christopher L. Nagel, and each of them, as his true
and lawful attorneys-in-fact and agents with full power of substitution and resubstitution, for him
and in his name, place and stead, in any and all capacities, to sign such Registration Statement
and any and all amendments thereto, and to file the same, with all exhibits thereto, and other
documents in connection therewith, with the Securities and Exchange Commission and the New York
Stock Exchange, granting unto each of said attorneys-in-fact and agents, and substitute or
substitutes, full power and authority to do and perform each and every act and thing requisite and
necessary to be done in and about the premises, as fully to all intents and purposes as he might or
could do in person, hereby ratifying and confirming all things that each of said attorneys-in-fact
and agents, or his or their substitute or substitutes, may lawfully do or cause to be done by
virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his hand this 27th day
of January, 2006.
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/s/ James Hagedorn
James Hagedorn
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POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned director of THE SCOTTS MIRACLE-GRO
COMPANY, an Ohio corporation, which is about to file with the Securities and Exchange Commission,
Washington, D.C., under the provisions of the Securities Act of 1933, as amended, a Registration
Statement on Form S-8 for the registration of certain of its common shares for offering and sale
pursuant to The Scotts Miracle-Gro Company 2006 Long-Term Incentive Plan, hereby constitutes and
appoints James Hagedorn, David M. Aronowitz and Christopher L. Nagel, and each of them, as her true
and lawful attorneys-in-fact and agents with full power of substitution and resubstitution, for her
and in her name, place and stead, in any and all capacities, to sign such Registration Statement
and any and all amendments thereto, and to file the same, with all exhibits thereto, and other
documents in connection therewith, with the Securities and Exchange Commission and the New York
Stock Exchange, granting unto each of said attorneys-in-fact and agents, and substitute or
substitutes, full power and authority to do and perform each and every act and thing requisite and
necessary to be done in and about the premises, as fully to all intents and purposes as she might
or could do in person, hereby ratifying and confirming all things that each of said
attorneys-in-fact and agents, or his or their substitute or substitutes, may lawfully do or cause
to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set her hand this 26th day
of January, 2006.
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/s/ Katherine Hagedorn Littlefield
Katherine Hagedorn Littlefield
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POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned director of THE SCOTTS MIRACLE-GRO
COMPANY, an Ohio corporation, which is about to file with the Securities and Exchange Commission,
Washington, D.C., under the provisions of the Securities Act of 1933, as amended, a Registration
Statement on Form S-8 for the registration of certain of its common shares for offering and sale
pursuant to The Scotts Miracle-Gro Company 2006 Long-Term Incentive Plan, hereby constitutes and
appoints James Hagedorn, David M. Aronowitz and Christopher L. Nagel, and each of them, as her true
and lawful attorneys-in-fact and agents with full power of substitution and resubstitution, for her
and in her name, place and stead, in any and all capacities, to sign such Registration Statement
and any and all amendments thereto, and to file the same, with all exhibits thereto, and other
documents in connection therewith, with the Securities and Exchange Commission and the New York
Stock Exchange, granting unto each of said attorneys-in-fact and agents, and substitute or
substitutes, full power and authority to do and perform each and every act and thing requisite and
necessary to be done in and about the premises, as fully to all intents and purposes as she might
or could do in person, hereby ratifying and confirming all things that each of said
attorneys-in-fact and agents, or his or their substitute or substitutes, may lawfully do or cause
to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set her hand this 26th day
of January, 2006.
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/s/ Karen G. Mills
Karen G. Mills
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POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned officer of THE SCOTTS MIRACLE-GRO
COMPANY, an Ohio corporation, which is about to file with the Securities and Exchange Commission,
Washington, D.C., under the provisions of the Securities Act of 1933, as amended, a Registration
Statement on Form S-8 for the registration of certain of its common shares for offering and sale
pursuant to The Scotts Miracle-Gro Company 2006 Long-Term Incentive Plan, hereby constitutes and
appoints James Hagedorn and David M. Aronowitz, and each of them, as his true and lawful
attorneys-in-fact and agents with full power of substitution and resubstitution, for him and in his
name, place and stead, in any and all capacities, to sign such Registration Statement and any and
all amendments thereto, and to file the same, with all exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange Commission and the New York Stock Exchange,
granting unto each of said attorneys-in-fact and agents, and substitute or substitutes, full power
and authority to do and perform each and every act and thing requisite and necessary to be done in
and about the premises, as fully to all intents and purposes as he might or could do in person,
hereby ratifying and confirming all things that each of said attorneys-in-fact and agents, or his
or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his hand this 27th day
of January, 2006.
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/s/ Christopher L. Nagel
Christopher L. Nagel
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POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned director of THE SCOTTS MIRACLE-GRO
COMPANY, an Ohio corporation, which is about to file with the Securities and Exchange Commission,
Washington, D.C., under the provisions of the Securities Act of 1933, as amended, a Registration
Statement on Form S-8 for the registration of certain of its common shares for offering and sale
pursuant to The Scotts Miracle-Gro Company 2006 Long-Term Incentive Plan, hereby constitutes and
appoints James Hagedorn, David M. Aronowitz and Christopher L. Nagel, and each of them, as his true
and lawful attorneys-in-fact and agents with full power of substitution and resubstitution, for him
and in his name, place and stead, in any and all capacities, to sign such Registration Statement
and any and all amendments thereto, and to file the same, with all exhibits thereto, and other
documents in connection therewith, with the Securities and Exchange Commission and the New York
Stock Exchange, granting unto each of said attorneys-in-fact and agents, and substitute or
substitutes, full power and authority to do and perform each and every act and thing requisite and
necessary to be done in and about the premises, as fully to all intents and purposes as he might or
could do in person, hereby ratifying and confirming all things that each of said attorneys-in-fact
and agents, or his or their substitute or substitutes, may lawfully do or cause to be done by
virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his hand this 26th day
of January, 2006.
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/s/ Patrick J. Norton
Patrick J. Norton
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