Exhibit 10.2
The Scotts Miracle-Gro Company
2006 Long-Term Incentive Plan
Effective January 26, 2006

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Contents

         
Article 1.
  Establishment, Purpose, and Duration   1
Article 2.
  Definitions   1
Article 3.
  Administration   5
Article 4.
  Shares Subject to this Plan and Maximum Awards   6
Article 5.
  Eligibility and Participation   7
Article 6.
  Stock Options   7
Article 7.
  Stock Appreciation Rights   9
Article 8.
  Restricted Stock and Restricted Stock Units   10
Article 9.
  Performance Units/ Performance Shares   11
Article 10.
  Cash-Based Awards and Other Stock-Based Awards   11
Article 11.
  Transferability of Awards   12
Article 12.
  Performance Measures   12
Article 13.
  Nonemployee Director Awards   14
Article 14.
  Dividend Equivalents   14
Article 15.
  Beneficiary Designation   14
Article 16.
  Rights of Participants   14
Article 17.
  Change of Control   15
Article 18.
  Amendment, Modification, Suspension, and Termination   16
Article 19.
  Withholding   17
Article 20.
  Successors   17
Article 21.
  General Provisions   17

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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 Plan’s 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.

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      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:

        (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;           (b) Misconduct
that materially injures the Company or any Subsidiary or Affiliate;          
(c) Conviction of, or entering into a plea of nolo contendere to, a felony; or  
        (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:

        (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 Company’s 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           (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
Company’s then outstanding securities; or           (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           (d) The adoption by the shareholders of
the Company of a plan relating to the liquidation or dissolution of the Company;
or           (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 Company’s 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.

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      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 Company’s 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 Company’s
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 Company’s 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.

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      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 Company’s securities in a capital raising transaction, and (b) do
not directly or indirectly promote or maintain a market for the Company’s
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.

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Article 4.
Shares Subject to this Plan and Maximum Awards
      4.1     Number of Shares Available for Awards.

        (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:

        (i) Four million nine hundred twenty-seven thousand three hundred
seventy-eight (4,927,378) newly authorized Shares, plus           (ii) (A) One
million seventy-two thousand six hundred twenty-two (1,072,622) Shares not
granted or subject to outstanding awards under the Company’s 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.

        (b) No more than three million (3,000,000) Shares of the Share
Authorization may be granted as Full Value Awards.           (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.           (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
Committee’s 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:

        (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.          
(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.          
(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.           (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

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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.           (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.           (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

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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 Participant’s
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 Participant’s Award Agreement
shall set forth the extent to which the Participant shall have the right to
exercise the Option following termination of the Participant’s

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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:

        (a) The excess of the Fair Market Value of a Share on the date of
exercise over the Grant Price; by           (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 Committee’s 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 Participant’s 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.

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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 Company’s
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 Participant’s 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 Participant’s
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 Participant’s
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

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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 Participant’s
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 Participant’s lifetime, his or her Awards shall be exercisable only by the
Participant or the Participant’s 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 Participant’s 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:

        (a) Net earnings or net income (before or after taxes);          
(b) Earnings per share (basic or diluted);           (c) Net sales or revenue
growth;           (d) Net operating profit;           (e) Return measures
(including, but not limited to, return on assets, capital, invested capital,
equity, sales, or revenue);           (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;           (h) Gross or operating margins;          
(i) Productivity ratios;           (j) Share price (including, but not limited
to, growth measures and total shareholder return);           (k) Expense
targets;           (l) Margins;           (m) Operating efficiency;          
(n) Market share;           (o) Customer satisfaction;           (p) Working
capital targets;           (q) Economic value added or EVA® (net operating
profit after tax minus the sum of capital multiplied by the cost of capital);  
        (r) Developing new products and lines of revenue;           (s) Reducing
operating expenses;           (t) Developing new markets;           (u) Meeting
completion schedules           (v) Developing and managing relationships with
regulatory and other governmental agencies;           (w) Managing cash;    
      (x) Managing claims against the Company, including litigation;          
(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 management’s discussion and analysis of financial condition and
results of operations appearing in the Company’s 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

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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 Participant’s lifetime. In the absence of any such
beneficiary designation, benefits remaining unpaid or rights remaining
unexercised at the Participant’s death shall be paid to or exercised by the
Participant’s 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 Participant’s 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:

        (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
Committee’s 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);           (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           (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 Committee’s 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 Employee’s employer
(or the parent or a subsidiary of that employer) immediately after the Change in
Control, provided that any Alternative Award must:

        (a) Be based on stock that is (or, within 60 days of the Change in
Control, will be) traded on an established securities market;          
(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;           (c) Have
substantially equivalent economic value to the Award (determined at the time of
the Change in Control) for which it is substituted; and           (d) Provide
that, if the Employee’s employment is involuntarily terminated without cause or
constructively terminated by the Employee, any conditions on the Employee’s
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 Employee’s
compensation or job responsibilities (when compared to the Employee’s
compensation and job responsibilities on the date of the Change in Control) or
the relocation of the Employee’s 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 Employee’s
written consent.

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      17.3     Nonemployee Directors’ Awards. Upon a Change in Control, each
outstanding:

        (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 Board’s 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).
          (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.           (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 Company’s
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

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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.

        (a) The Committee may specify in an Award Agreement that the
Participant’s 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
Participant’s 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.           (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:

        (a) Obtaining any approvals from governmental agencies that the Company
determines are necessary or advisable; and           (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 Company’s 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:

        (a) Determine which Affiliates and Subsidiaries shall be covered by this
Plan;           (b) Determine which Employees, Directors, and/or Third Party
Service Providers outside the United States are eligible to participate in this
Plan;           (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;           (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           (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

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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 Company’s or any Subsidiary’s or Affiliate’s 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 Participant’s 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 Participant’s 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 Company’s or a
Subsidiary’s or an Affiliate’s 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 Company’s 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
Company’s 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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