Exhibit 10.7





Exhibit 10.7




Summary of Compensation for Nonemployee Directors of

The Scotts Miracle-Gro Company

Effective as of January 22, 2010




 






At the meeting of the Board of Directors (the “Board”) of The Scotts Miracle-Gro Company (the
“Company”) held on January 21, 2010, the Board approved the recommendations of the Governance and
Nominating Committee of the Board with respect to compensation for the 2010 calendar year for
nonemployee members of the Board (“Nonemployee Directors”) and the Lead Independent Director of the
Company. The compensation approved by the Board is described below.



Annual Cash Retainer; Reimbursement of Expenses




Effective January 22, 2010, each of the Nonemployee Directors will be paid an annual cash
retainer in the amount of $100,000 and the Lead Independent Director will be paid an additional
annual cash retainer in the amount of $15,000. The annual cash retainer(s) will be paid on a
quarterly basis, in January, April, July and October, 2010. Nonemployee Directors receive
reimbursement of all reasonable travel and other expenses associated with attending Board and Board
committee meetings.



Deferred Stock Units




On January 22, 2010: (a) each Nonemployee Director was granted deferred stock units having a
value of $70,000; (b) the Lead Independent Director was granted additional deferred stock units
having a value of $35,000; (c) each Nonemployee Director was granted additional deferred stock
units having a value of $12,500 for each committee of the Board on which such Nonemployee Director
serves; (d) each Nonemployee Director serving as the chairperson of a committee of the Board was
granted additional deferred stock units having a value of $25,000; and (e) each Nonemployee
Director serving on the Audit Committee of the Board was granted additional deferred stock units
having a value of $5,000. The number of deferred stock units (and related dividend equivalents)
granted to each Nonemployee Director (including the Lead Independent Director) was calculated by
dividing the aggregate value of deferred stock units to be granted to such Nonemployee Director by
the closing price of the Company’s common shares on the January 22, 2010 grant date ($41.03) and
rounding any resulting fractional deferred stock unit up to the next whole deferred stock unit.



The deferred stock units (and related dividend equivalents) were granted under The Scotts
Miracle-Gro Company Amended and Restated 2006 Long-Term Incentive Plan (the “2006 Plan”). Each
whole deferred stock unit represents the right to receive one full common share of the Company at
the time and in the manner described in the Deferred Stock Unit Award Agreement for Nonemployee
Directors (with Related Dividend Equivalents) evidencing the award. Each dividend equivalent
represents the right to receive additional deferred stock units (rounded to the nearest whole
deferred stock unit) in respect of dividends that are declared and
paid during the period beginning on the grant date and ending on the settlement date with
respect to the common share of the Company represented by the related deferred stock unit.


 


 









 





The deferred stock units, including any deferred stock units received in respect of dividend
equivalents on or prior to the vesting date, will generally become 100% vested on January 22, 2013.
Any deferred stock units received in respect of dividend equivalents following the vesting date
will be 100% vested on the date they are credited to the Nonemployee Director. If, prior to the
vesting date, a Nonemployee Director ceases to be a member of the Board after having been convicted
of, or pleading guilty or nolo contendere to, a felony (“Cause”), the Nonemployee Director’s
deferred stock units (and related dividend equivalents) will be immediately forfeited.



Under certain circumstances, the deferred stock units will vest prior to January 22, 2013.
These circumstances depend, in part, on whether a Nonemployee Director had served one full term on
the Board as of January 22, 2010. If a Nonemployee Director who had served less than one full term
on the Board as of January 22, 2010: (a) ceases to be a member of the Board (other than for Cause)
after completing at least one full term of continuous service on the Board, (b) dies or (c) becomes
totally disabled, then the deferred stock units granted during the Nonemployee Director’s first
term will become 100% vested as of the date of such event. If a Nonemployee Director who had
served at least one full term on the Board as of January 22, 2010: (a) ceases to be a member of
the Board (other than for Cause) after completing at least two full terms of continuous service on
the Board and attaining age 50, (b) dies or (c) becomes totally disabled, then all of the
Nonemployee Director’s deferred stock units will become 100% vested as of the date of such event.
If a Nonemployee Director ceases to be a member of the Board prior to the vesting date for any
reason not described in the preceding two sentences, the Nonemployee Director’s deferred stock
units (and related dividend equivalents) will be immediately forfeited.



Subject to the terms of the 2006 Plan, vested deferred stock units will be settled in a lump
sum as soon as administratively practicable, but no later than 90 days, following the earliest to
occur of: (i) a Nonemployee Director’s ceasing to be a member of the Board; (ii) a Nonemployee
Director’s death; (iii) the date a Nonemployee Director becomes totally disabled; or (iv) January
22, 2015. Whole deferred stock units will be settled in full common shares of the Company and any
fractional deferred stock units will be settled in cash, determined based on the fair market value
of a common share of the Company on the settlement date.



If there is a Change in Control (as defined in the 2006 Plan), each Nonemployee Director’s
deferred stock units will become 100% vested on the date of the Change in Control and will be
settled as described in the 2006 Plan.



For more information about the deferred stock units (and related dividend equivalents) granted
to the Nonemployee Directors, please refer to (a) the form of Deferred Stock Unit Award Agreement
for Nonemployee Directors (with Related Dividend Equivalents) that is included as Exhibit 10.1 to
the Company’s Quarterly Report on Form 10-Q for the quarterly period ended March 28, 2009; (b) the
2006 Plan that is included as Exhibit 10(r)(2) to the Company’s Annual Report on Form 10-K for the
fiscal year ended September 30, 2007; and (c) the First Amendment to the 2006 Plan that is included
as Exhibit 10.1 to this Quarterly Report on Form 10-Q.




 


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