Document:

EX-4.4

 

EXHIBIT 4.4

INTERNATIONAL MULTIFOODS CORPORATION

NON-QUALIFIED STOCK OPTION AGREEMENT

     THIS AGREEMENT, dated as of July 1, 1998, is entered into between International Multifoods
Corporation, a Delaware corporation (the “Company”), and Daryl Schaller (the “Consultant”).

     The Company, in consideration of consulting services to be provided by the Consultant to the
Company for the period beginning April 27, 1998 and ending on April 27, 1999 (the “Consulting
Period”) under the Consulting Agreement, dated April 27, 1998, between the Company and the
Consultant (the “Consulting Agreement”), wishes to grant a stock option for the purchase of Common
Stock of the Company, par value $.10 per share, out of shares held in the Company’s treasury (the
“Common Stock”), to the Consultant, on the terms and conditions contained in this Agreement.

     Accordingly, in consideration of the premises and the agreements set forth herein, the parties
hereto hereby agree as follows:

     1.     Grant of Option

     The Company, effective as of the date of this Agreement, pursuant to Section 157 of the
Delaware General Corporation Law, and resolutions adopted by the Board of Directors of the Company
(the “Board”) on June 19, 1998, hereby grants to the Consultant as compensation for consulting
services to be rendered, the right and option (the “Option”) to purchase all or any part of an
aggregate of 5302 shares of Common Stock (the “Shares”) at the price of $27.75 per share, on the
terms and conditions set forth in this Agreement.

     2.     Vesting and Term of Option

     (a)     The Option may not be exercised, in whole or in part, prior to July 1, 1999.
The Option may be exercised in whole or in part, at any time, or from time to time, on or after
July 1, 1999 and on or before the close of business on June 30, 2008, or such shorter period as is
prescribed herein.

     (b)     Notwithstanding the vesting provision contained in Section 2(a) above, but
subject to the other terms and conditions set forth herein, the Option may be exercised, in whole
or in part, at any time, or from time to time, following the occurrence of a “Change of Control”,
as hereinafter defined.

     (c)     For the purpose of this Agreement, a “Change of Control” shall mean:

          (i)     The acquisition by any individual, entity or group (within the meaning of Section
13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) (a
“Person”) of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange
Act) of 35% or more of either (A) the then outstanding shares of Common Stock (the “Outstanding
Company Common Stock”) or (B) the combined voting power of the then outstanding voting securities
of the Company entitled to vote generally in the election of directors (the “Outstanding Company
Voting Securities”); provided, however, that for purposes of this subsection (i), the following
acquisitions shall not constitute a Change of Control: (1) any acquisition directly from the
Company, (2) any acquisition by the Company, (3) any acquisition by any employee benefit plan (or
related trust) sponsored or maintained by the Company or any corporation controlled by the Company
or (4) any acquisition by any corporation

 

 

pursuant to a transaction which complies with clauses (A), (B) and (C) of subsection (iii) of
this Section 2(c); or

          (ii)     Individuals who, as of the date hereof, constitute the Board (the “Incumbent
Board”) cease for any reason to constitute at least a majority of the Board; provided, however,
that any individual becoming a director subsequent to the date hereof whose election, or nomination
for election by the Company’s stockholders, was approved by a vote of at least a majority of the
directors then comprising the Incumbent Board shall be considered as though such individual were a
member of the Incumbent Board, but excluding, for this purpose, any such individual whose initial
assumption of office occurs as a result of an actual or threatened election contest with respect to
the election or removal of directors or other actual or threatened solicitation of proxies or
consents by or on behalf of a Person other than the Board; or

          (iii)     Consummation of a reorganization, merger or consolidation or sale or other
disposition of all or substantially all of the assets of the Company (a “Business Combination”), in
each case, unless, following such Business Combination, (A) all or substantially all of the
individuals and entities who were the beneficial owners, respectively, of the Outstanding Company
Common Stock and Outstanding Company Voting Securities immediately prior to such Business
Combination beneficially own, directly or indirectly, more than 60% of, respectively, the then
outstanding shares of common stock and the combined voting power of the then outstanding voting
securities entitled to vote generally in the election of directors, as the case may be, of the
corporation resulting from such Business Combination (including, without limitation, a corporation
which as a result of such transaction owns the Company or all or substantially all of the Company’s
assets either directly or through one or more subsidiaries) in substantially the same proportions
as their ownership, immediately prior to such Business Combination of the Outstanding Company
Common Stock and Outstanding Company Voting Securities, as the case may be, (B) no Person
(excluding any employee benefit plan (or related trust) of the Company or such corporation
resulting from such Business Combination) beneficially owns, directly or indirectly, 35% or more
of, respectively, the then outstanding shares of common stock of the corporation resulting from
such Business Combination or the combined voting power of the then outstanding voting securities of
such corporation except to the extent that such ownership existed prior to the Business Combination
and (C) at least a majority of the members of the board of directors of the corporation resulting
from such Business Combination were members of the Incumbent Board at the time of the execution of
the initial agreement, or of the action of the Board, providing for such Business Combination; or

          (iv)     Approval by the stockholders of the Company of a complete liquidation or
dissolution of the Company.

     3.     Termination of Option

     The Option shall terminate and may no longer be exercised by the Consultant if the Company
terminates the Consulting Agreement by reason of: (i) the breach by the Consultant of his
obligations and commitments to the Company under the Consulting Agreement; and/or (ii) the gross
and willful misconduct by the Consultant during the Consulting Period, including, but not limited
to, wrongful appropriation of funds or the commission of a gross misdemeanor or felony.

     4.     Death of Consultant

     If the Consultant shall die during the term of the Option, the Option may be exercised at any time
within 12 months after the date of the Consultant’s death, to the

 

 

extent that the Option was exercisable by the Consultant on the date of death, by the personal
representatives or administrators of the Consultant or by any person or persons to whom the Option
has been transferred by will or the applicable laws of descent and distribution, subject to the
condition that the Option shall not be exercisable after the expiration of the term of the Option.

     5.     Method of Exercising Option

     Subject to the terms and conditions of this Agreement, the Option may be exercised by written
notice of exercise delivered to the Company, to the attention of the Secretary, 5 business days
prior to the intended date of exercise. Such notice shall state the election to exercise the
Option, the number of Shares as to which the Option is being exercised and the manner of payment
and shall be signed by the Consultant. The notice shall be accompanied by payment in full of the
exercise price for all Shares designated in the notice. Payment of the exercise price shall be
made to the Company by delivery of a check payable to the Company or cash, in United States
currency.

     6.     Adjustments

     In the event of a reorganization, recapitalization, stock split, stock dividend, combination
of shares, merger, consolidation, distribution of assets, or any other changes in the corporate
structure or stock of the Company, the Board shall make such adjustments as are appropriate in the
number and kind of shares covered by the Option and in the exercise price of the Option.

     7.     Income Tax Withholding

     In order to provide the Company with the opportunity to claim the benefit of any income tax
deduction which may be available to it upon the exercise of the Option, and in order to comply with
all applicable federal or state income tax laws or regulations, the Company may take such action as
it deems appropriate to ensure that all applicable federal or state income or other taxes, which
are the sole and absolute responsibility of the Consultant, are reported to the federal and state
taxing authorities and withheld or collected from the Consultant. The Consultant may, at the
Consultant’s election, satisfy applicable tax withholding obligations by (a) delivering a check
payable to the Company or cash, in United States currency, equal to the amount of such taxes, or
(b) delivering to the Company a Form W-9 (Department of the Treasury, Internal Revenue Service)
duly executed by the Consultant, or successor form setting forth the Consultant’s identification
number and a certification by the Consultant to the effect that the Consultant is not subject to
backup withholding.

     8.     Registration

     At any time prior to July l, 1999, the Company will file a Form S-8 registration statement
under the Securities Act of 1933 with respect to the Option and the Shares, or such other form of
registration statement with respect to the Option and the Shares as is deemed appropriate by the
Company.

     9.     General

     (a)     Neither the Consultant nor the Consultant’s successors or assigns shall have any
of the rights and privileges of a stockholder of the Company with respect to the Shares of Common
Stock subject to the Option unless and until certificates for such Shares shall have been issued
upon exercise of the Option.

 

 

     (b)     The Option shall not be transferable by the Consultant other than by will or by the
laws of descent and distribution. During the Consultant’s lifetime the Option shall be exercisable
only by the Consultant.

     (c)     The Company shall not be required, upon the exercise of the Option or any part
thereof, to issue or deliver any Shares until the requirements of any federal or state securities
laws, rules or regulations or other laws or rules (including the rules of the New York Stock
Exchange) as may be determined by the Company to be applicable are satisfied.

     (d)     The Company shall at all times during the term of the Option reserve and keep
available such number of treasury shares of Common Stock as will be sufficient to satisfy the
requirements of this Agreement.

     (e)     This Agreement shall be governed by and construed under the internal laws of the
State of Delaware, without giving effect to the conflicts of law principles thereof.

     10.     Notices

     All notices or other communications required or permitted to be given hereunder shall be in
writing and shall be delivered by hand, or sent by telecopy, or sent, postage prepaid, by United
States registered, certified or express mail, or reputable overnight courier service, and shall be
deemed given, if delivered by hand or sent by telecopy, when so delivered or so sent, or, if sent
by mail or by overnight courier service, when received by the addressee, as follows:

     (a)     If to the Company,

International Multifoods Corporation

200 East Lake Street

Wayzata, Minnesota 55391

Attention: Vice President, General Counsel and Secretary

Facsimile Number (612) 594-3367

     (b)     If to the Consultant,

Daryl Schaller

1709 York Island Drive

Naples, Florida 34112

Facsimile Number (941) 417-2704

     Either party hereto may change the address or facsimile number to which notices and other
communications are to be delivered or sent by giving the other party prior written notice in the
manner set forth herein.

 

 

     IN WITNESS WHEREOF, the Company and the Consultant have executed this Agreement as of the day
and year first above written.

	 	 	 	 	 	 
	Attest: 	 	International Multifoods Corporation

 	 
	     /s/ Frank W. Bonvino	 	By:  	     /s/ Gary E. Costley
 	 
	Secretary	 	 	Gary E. Costley 	 
	 	 	Its:  	Chairman of the Board, President and

Chief Executive Officer	 
	 
	 	 	     /s/
Daryl Schaller 	 
	 	 	Daryl SchallerEX-10.1

 

Exhibit 10.1

Employment Agreement for

Christopher Nagel

The Scotts Miracle-Gro Company

October 1, 2006

 

 

Contents

	 	 	 	 	 
	Article 1. Term of Employment
	 	 	1	 
	 
	 	 	 	 
	Article 2. Definitions
	 	 	2	 
	 
	 	 	 	 
	Article 3. Position and Responsibilities
	 	 	5	 
	 
	 	 	 	 
	Article 4. Standard of Care
	 	 	5	 
	 
	 	 	 	 
	Article 5. Compensation
	 	 	5	 
	 
	 	 	 	 
	Article 6. Expenses
	 	 	6	 
	 
	 	 	 	 
	Article 7. Employment Terminations
	 	 	7	 
	 
	 	 	 	 
	Article 8. Assignment
	 	 	11	 
	 
	 	 	 	 
	Article 9. Notice and Dispute Resolution
	 	 	12	 
	 
	 	 	 	 
	Article 10. Confidentiality, Noncompetition, and Nonsolicitation
	 	 	12	 
	 
	 	 	 	 
	Article 11. Miscellaneous
	 	 	12	 
	 
	 	 	 	 
	Article 12. Governing Law
	 	 	14	 
	 
	 	 	 	 
	Article 13. Indemnification
	 	 	14	 

 

 

The Scotts Miracle-Gro Company

Employment Agreement for Christopher Nagel

     This EMPLOYMENT AGREEMENT is made, entered into, and is effective as of this first day
of October 2006 (herein referred to as the “Effective Date”), by and between The Scotts Miracle-Gro
Company (“Company”), an Ohio corporation and Christopher Nagel (“Executive”).

     WHEREAS, the Company and the Executive intend that the Executive shall serve the Company as
Executive Vice President—North America Consumer Business.

     WHEREAS, the Executive possesses considerable experience and an intimate knowledge of the
business, and, as such, the Executive has demonstrated unique qualifications to act in an executive
capacity for the Company.

     WHEREAS, the Company is desirous of assuring the employment of the Executive in the above
stated capacity, and the Executive is desirous of such assurance.

     WHEREAS, the Company and Executive desire to enter into an agreement embodying the terms of
such employment.

     NOW THEREFORE, in consideration of the foregoing and of the mutual covenants and agreements of
the parties set forth in this Agreement, and of other good and valuable consideration the receipt
and sufficiency of which are hereby acknowledged, the parties hereto, intending to be legally
bound, agree as follows:

Article 1. Term of Employment

     The Company hereby agrees to employ the Executive and the Executive agrees to serve the
Company, in accordance with the terms and conditions set forth herein, for an initial period of
three (3) years commencing as of the Effective Date; subject, however, to earlier termination as
expressly provided herein.

     The initial three (3) year period of employment shall be extended for one (1) additional year
at the end of the initial three (3) year term and then again after each successive year thereafter.
However, either party may terminate this Agreement at the end of the initial three (3) year period,
or at the end of any successive one (1) year term thereafter, by giving the other party written
notice of intent not to renew delivered at least sixty (60) days prior to the end of such initial
period or successive term.

     In the event such notice of intent not to renew is properly delivered, this Agreement
automatically shall expire at the end of the initial period or successive term then in progress.

     Notwithstanding the foregoing, if at any time during the initial term of the Agreement, or
successive term, a Change in Control of the Company occurs, then this Agreement shall become
immediately irrevocable for two (2) years beyond the month in which the effective date of such
Change in Control occurs.

1

 

Article 2. Definitions

	 	2.1	 	“Agreement” means this Employment Agreement for Christopher Nagel.
	 
	 	2.2	 	“Annual Bonus Award” means the annual bonus to be paid to the Executive in accordance
with the Company’s annual bonus program as described in Section 5.2 herein.
	 
	 	2.3	 	“Award Period” means the performance period applicable to Long-Term Incentive Awards
granted under the Company’s long-term incentive plan.
	 
	 	2.4	 	“Base Salary” means the salary of record paid to the Executive as annual salary,
pursuant to Section 5.1, excluding amounts received under incentive or other bonus plans,
whether or not deferred.
	 
	 	2.5	 	“Beneficiary” means the individuals or entities designated or deemed designated by
the Executive pursuant to Section 11.6 herein.
	 
	 	2.6	 	“Board” or “Board of Directors” means the Board of Directors of the Company.
	 
	 	2.7	 	“Cause” means the Executive’s:

	 	(a)	 	Continued failure to substantially perform his duties with the Company,
after a written demand for substantial performance is delivered to the Executive
that specifically identifies the manner in which the Company believes that the
Executive has failed to substantially perform his duties, and after the Executive
has failed to resume substantial performance of his duties on a continuous basis
within thirty (30) calendar days of receiving such demand; or
	 
	 	(b)	 	Conviction of a felony; or
	 
	 	(c)	 	Engagement in illegal conduct, an act of dishonesty, or other similar
conduct, that in the Committee’s sole discretion, which shall be exercised in good
faith, is injurious to the Company; or
	 
	 	(d)	 	Material breach of any provision of this Agreement; provided, however,
that the Executive’s willful and material breach of Article 4 shall not constitute
“Cause” unless the Executive has first been provided with written notice detailing
such breach and a thirty (30) day period to cure such breach; or
	 
	 	(e)	 	Breach of the Company’s code of business conduct or ethics as
determined in good faith by the Committee; or
	 
	 	(f)	 	A violation of the Company’s insider-trading policies; or
	 
	 	(g)	 	Material breach of his fiduciary duties to the Company.

2

 

	 	 	 	For purposes of determining Cause, no act or omission by the Executive shall be
considered “willful” unless it is done or omitted in bad faith or without reasonable
belief that the Executive’s action or omission was in the best interests of the Company.
Any act or failure to act based upon: (a) authority given pursuant to a resolution duly
adopted by the Board; or (b) advice of counsel for the Company, shall be conclusively
presumed to be done or omitted to be done by the Executive in good faith and in the best
interests of the Company.
	 
	 	2.8	 	“Change in Control” means the occurrence of any of the following events after the
Effective Date of this Agreement:

	 	(a)	 	Any “person” or “group” (as such terms are used in Sections 13(d) and
14(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”))
other than the Company, subsidiaries of the Company, an employee benefit plan
sponsored by the Company, or Hagedorn Partnership, L.P. or its successor or any
party related to Hagedorn Partnership, L.P. (as determined by the Board of
Directors) is or becomes the “beneficial owner” (as defined in Rule 13d-3 under the
Exchange Act), directly or indirectly, of more than thirty percent (30%) of the
combined voting stock of the Company;
	 
	 	(b)	 	The shareholders of the Company adopt or approve a definitive agreement
or series of related agreements for the merger or other business consolidation with
another person and, immediately after giving effect to the merger or consolidation,
(i) less than fifty percent (50%) of the total voting power of the outstanding
voting stock of the surviving or resulting person is then “beneficially owned”
(within the meaning of Rule l3d-3 under the Exchange Act) in the aggregate by (x)
the stockholders of the Company immediately prior to such merger or consolidation,
or (y) if a record date has been set to determine the stockholders of the Company
entitled to vote with respect to such merger or consolidation, the stockholders of
the Company as of such record date and (ii) any “person” or “group” (as defined in
Section 13(d)(3) or 14(d)(2) of the Exchange Act) has become the direct or indirect
“beneficial owner” (as defined in Rule l3d-3 under the Exchange Act) of more than
fifty percent (50%) of the voting power of the voting stock of the surviving or
resulting person;
	 
	 	(c)	 	The Company, either individually or in conjunction with one or more of
its subsidiaries, sells, assigns, conveys, transfers, leases or otherwise disposes
of, or the subsidiaries sell, assign, convey, transfer, lease or otherwise dispose
of, all or substantially all of the properties and assets of the Company and the
subsidiaries, taken as a whole (either in one transaction or a series of related
transactions), to any person (other than the Company or a wholly owned subsidiary);

3

 

	 	(d)	 	For any reason, Hagedorn Partnership, L.P. or its successor or any
party related to Hagedorn Partnership, L.P. (as determined by the Board of
Directors) becomes the beneficial owner, as defined above, directly or indirectly,
of securities of the Company representing more than forty-nine percent of the
combined voting power of the Company’s then-outstanding voting securities; or
	 
	 	(e)	 	The adoption or authorization by the shareholders of the Company of a
plan providing for the liquidation or dissolution of the Company.

	 	2.9	 	“Code” means the U.S. Internal Revenue Code of 1986, as amended from time to time.
For purposes of this Agreement, references to sections of the Code shall be deemed to
include references to any applicable regulations thereunder and any successor or similar
provision.
	 
	 	2.10	 	“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
Agreement. 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.
	 
	 	2.11	 	“Company” means The Scotts Miracle-Gro Company, an Ohio corporation, or any successor
company thereto as provided in Section 8.1 herein.
	 
	 	2.12	 	“Director” means any individual who is a member of the Board of Directors of the
Company.
	 
	 	2.13	 	“Disability” or “Disabled” means for all purposes of this Agreement, a consecutive
period of ninety (90) days during which the Executive is unable to perform his duties.
	 
	 	2.14	 	“Effective Date” means October 1, 2006.
	 
	 	2.15	 	“Effective Date of Termination” means the date on which a termination of the
Executive’s employment occurs.
	 
	 	2.16	 	“Executive” means Christopher Nagel.
	 
	 	2.17	 	“Good Reason” means:

	 	(a)	 	A material reduction in the Executive’s duties or responsibilities as
compared to other comparable senior executives of the Company is effected by the
Committee and/or the Chairman & Chief Executive Officer of the Company and such
material reduction is made without the Executive’s written consent (without regard
to whether or not any change is made to the Executive’s title); and
	 
	 	(b)	 	A material reduction in the Executive’s pay or benefits as compared to
other comparable senior executives of the Company.

4

 

	 	2.18	 	“Long-Term Incentive Award” means the Long-Term Incentive Award to be paid to the
Executive in accordance with the Company’s long-term incentive plan as described in
Section 5.3 herein.
	 
	 	2.19	 	“Notice of Termination” means a written notice which shall indicate the specific
termination provision in this Agreement relied upon, and shall set forth in reasonable
detail the facts and circumstances claimed to provide a basis for termination of the
Executive’s employment under the provisions so indicated.

Article 3. Position and Responsibilities

     During the term of this Agreement, the Executive agrees to serve as Executive Vice
President—North America Consumer Business. In his capacity as Executive Vice President, the
Executive shall report directly to the Chairman & Chief Executive Officer of the Company, and shall
perform duties and responsibilities of an Executive Vice President and other duties and
responsibilities as the Chairman & Chief Executive Officer may assign him during the term of this
Agreement.

Article 4. Standard of Care

     During the term of this Agreement, the Executive agrees to devote his full time,
attention, and energies to the Company’s business and shall not be engaged in any other business
activity, whether or not such business activity is pursued for gain, profit, or other pecuniary
advantage unless such business activity is approved in writing by the Board or Committee, provided,
however, that board positions with nonprofit or philanthropic organizations which do not interfere
with the Executive’s performance of his duties and responsibilities shall not require Board or
Committee Board approval. The Executive covenants, warrants, and represents that he shall:

	 	(a)	 	Devote his full and best efforts to the fulfillment of his employment obligations;
and
	 
	 	(b)	 	Adhere to the Company’s code of business conduct or ethics as determined by the Board
or Committee and exercise the highest standards of conduct in the performance of his
duties.

Article 5. Compensation

     As remuneration for all services to be rendered by the Executive during the term of
this Agreement, and as consideration for complying with the covenants herein, the Company shall pay
and provide to the Executive the following.

     5.1 Base Salary. The Company shall pay the Executive a Base Salary in the amount of four
hundred and fifty thousand dollars ($450,000.00) per year. This Base Salary shall be paid to the
Executive in equal installments throughout the year, consistent with the normal payroll practices
of the Company. The Base Salary shall be reviewed at least annually following the Effective Date of
this Agreement, while this Agreement is in force, to ascertain whether, in the judgment of the
Committee, such Base Salary should be modified. If modified, the Base Salary as stated above shall,
likewise, be modified for all purposes of this Agreement.

5

 

     5.2 Annual Bonus. Executive shall be eligible to receive in addition to his Base Salary an
annual incentive compensation award (“Annual Bonus Award”) for services rendered during such fiscal
year. The amount of the Annual Bonus Award, if any, with respect to any fiscal year shall be based
upon performance targets and award levels determined by the Committee in its sole discretion, in
accordance with the Company’s annual incentive compensation plan as in effect for executives from
time to time.

     5.3 Long-Term Incentives. Executive shall be eligible to receive, in addition to his Base
Salary and Annual Bonus Award, a Long-Term Incentive Award for services rendered during an Award
Period established by the Committee. The amount of the Long-Term Incentive Award, if any, with
respect to any Award Period shall be based upon performance targets and award levels determined by
the Committee in its sole discretion, in accordance with the Company’s long-term incentive
compensation plan as in effect for executives from time to time.

     5.4 Retirement Benefits. During the term of this Agreement, and as otherwise provided within
the provisions of each of the respective plans, the Company shall provide to the Executive all
retirements benefits to which other executives and employees of the Company are entitled to
receive, subject to the eligibility requirements and other provisions of such arrangements as
applicable to executives of the Company generally.

     5.5 Employee Benefits. During the term of this Agreement, and as otherwise provided within the
provisions of each of the respective plans, the Company shall provide to the Executive all benefits
to which other executives and employees of the Company are entitled to receive, subject to the
eligibility requirements and other provisions of such arrangements as applicable to executives of
the Company generally. Such benefits shall include, but shall not be limited to, life insurance,
comprehensive health and major medical insurance, dental insurance, prescription drug insurance,
vision insurance, and short-term and long-term disability. The Executive shall likewise participate
in any additional benefit as may be established during the term of this Agreement, by standard
written policy of the Company.

     5.6 Perquisites. The Company shall provide to the Executive on an annual basis an automobile
allowance of twelve thousand ($12,000.00) dollars. This allowance shall be paid to the Executive in
equal installments throughout the year, consistent with the normal payroll practices of the
Company. Additionally, the Company shall provide on an annual basis to the Executive with either a
four thousand dollar ($4,000) amount to be used in lieu of the provision of personal financial
planning, or will provide personal financial planning up to a cost or value of such amount. The
value of such services or such amount will be added to the Executive’s taxable income. Some or all
of such value or amount may be tax deductible by the Executive, but the Company makes no tax
representation relating thereto.

Article 6. Expenses

     Upon presentation of appropriate documentation, the Company shall pay, or reimburse the
Executive for all ordinary and necessary expenses, in a reasonable amount, which the Executive
incurs in performing his duties under this Agreement including, but not limited to, travel,
entertainment, professional dues and subscriptions, and all dues, fees, and expenses associated
with membership in various professional, business, and civic associations and societies in which
the Executive’s participation is in the best interest of the Company, as determined by the
Committee in its sole discretion.

6

 

Article 7. Employment Terminations

     7.1 Termination Due to Death. In the event the Executive’s employment is terminated
while this Agreement is in force by reason of death, the Company’s obligations under this Agreement
shall immediately expire.

     Notwithstanding the foregoing, the Company shall be obligated to pay to the Executive the
following:

	 	(a)	 	Base Salary through the Effective Date of Termination;
	 
	 	(b)	 	A prorated Annual Bonus Award based on the Executive’s target bonus
opportunity established for the year in which termination of employment occurs. The
prorated amount shall be determined as a function of time within the year that has
elapsed prior to the Executive’s Effective Date of Termination;
	 
	 	(c)	 	Accrued but unused vacation pay through the Effective Date of
Termination; and
	 
	 	(d)	 	All other rights and benefits the Executive is vested in, pursuant to
other plans and programs of the Company.

     The benefits described in Sections 7.1(a), (b), and (c) shall be paid in cash to the
Executive’s Beneficiary in a single lump sum as soon as practicable following the Effective Date of
Termination in order to avoid penalties and excise taxes under the requirements Section Code 409A.
All other payments due to the Executive upon termination of employment shall be paid in accordance
with the terms of such applicable plans or programs. The Company and the Executive thereafter shall
have no further obligations under this Agreement.

     7.2 Termination Due to Disability. In the event that the Executive becomes Disabled during the
term of this Agreement and is, therefore, unable to perform his duties herein for more than ninety
(90) consecutive calendar days during any period of twelve (12) consecutive months, the Company
shall have the right to terminate the Executive’s active employment as provided in this Agreement.
However, the Committee shall deliver written notice to the Executive of the Company’s intent to
terminate for Disability at least thirty (30) calendar days prior to the Effective Date of
Termination.

     Disability shall be determined by the Committee upon receipt of and in reliance on competent
medical advice from one (1) or more individuals, selected by the Committee, who are qualified to
give such professional medical advice.

     A termination for Disability shall become effective upon the end of the thirty (30) day notice
period. Upon the Effective Date of Termination, the Company’s obligations under this Agreement
shall immediately expire.

7

 

     Notwithstanding the foregoing, the Company shall be obligated to pay to the Executive the
following:

	 	(a)	 	Base Salary through the Effective Date of Termination (subject to an
offset for any disability payments that the Executive receives during this period);
	 
	 	(b)	 	A prorated Annual Bonus Award based on the Executive’s target bonus
opportunity established for the year in which termination of employment occurs. The
prorated amount shall be determined as a function of time within the year that has
elapsed prior to the Executive’s Effective Date of Termination;
	 
	 	(c)	 	Accrued but unused vacation pay through the Effective Date of
Termination; and
	 
	 	(d)	 	All other rights and benefits the Executive is vested in, pursuant to
other plans and programs of the Company.

     The benefits described in Sections 7.2(a), (b), and (c) shall be paid in cash to the Executive
in a single lump sum as soon as practicable following the Effective Date of Termination in order to
avoid penalties and excise taxes under the requirements of Section Code 409A. All other payments
due to the Executive upon termination of employment shall be paid in accordance with the terms of
such applicable plans or programs. The Company and the Executive thereafter shall have no further
obligations under this Agreement.

     7.3 Voluntary Termination by the Executive. The Executive may terminate this Agreement at any
time by giving the Committee written notice of his intent to terminate, delivered at least sixty
(60) calendar days prior to the Effective Date of Termination. The termination automatically shall
become effective upon the expiration of the sixty (60) day notice period. Notwithstanding the
foregoing, the Company may waive the sixty (60) day notice period; however, the Executive shall be
entitled to receive all elements of compensation described in Sections 5.1 through 5.6 for the
sixty (60) day notice period, subject to the eligibility and participation requirements of any
employee benefit plan.

     Upon the Effective Date of Termination, following the expiration of the sixty (60) day notice
period, the Company shall pay the Executive his accrued and unpaid Base Salary and accrued but
unused vacation pay, at the rate then in effect, through the Effective Date of Termination, plus
all other benefits to which the Executive has a vested right at that time (for this purpose, the
Executive shall not be entitled to any Annual Bonus Award with respect to the fiscal year in which
voluntary termination under this Section 7.3 occurs or any Long-Term Incentive Award for the Award
Period then in progress). With the exception of the covenants referenced in Article 10, herein
(which shall survive such termination), the Company and the Executive thereafter shall have no
further obligations under this Agreement.

8

 

     7.4 Termination by the Company without Cause or by the Executive with Good Reason unrelated to
a Change in Control of the Company. At all times during the term of this Agreement, the Committee
may terminate the Executive’s employment for reasons other than death, Disability, or for Cause, by
providing to the Executive a Notice of Termination, at least sixty (60) calendar days prior to the
Effective Date of Termination. Such Notice of Termination shall be irrevocable absent express,
mutual consent of the parties. Additionally, the Executive may terminate employment with the
Company for Good Reason by providing the Company with a Notice of Termination at least sixty (60)
calendar days prior to the Effective Date of Termination. The Notice of Termination must set forth
in reasonable detail the facts and circumstances claimed to provide a basis for such Good Reason
termination. The Company shall have thirty (30) days to cure such Company action following receipt
of the Notice of Termination. The Company shall have one (1) cure period for each reason that
allows an Executive to terminate his employment for Good Reason.

     Subject to the Executive signing a waiver of all claims, upon the Effective Date of
Termination, following the expiration of the sixty (60) day notice period, the Company shall pay
and provide to the Executive:

	 	(a)	 	An amount equal to the Executive’s accrued and unpaid Base Salary and accrued but
unused vacation pay through the Effective Date of Termination;
	 
	 	(b)	 	An amount equal to two (2) times the Executive’s annual Base Salary, at the Base
Salary rate in effect on the Effective Date of Termination;
	 
	 	(c)	 	An amount equal to one (1) times the Executive’s targeted Annual Bonus Award, at
the targeted Annual Bonus Award in effect on the Effective Date of Termination;
	 
	 	(d)	 	At the exact same cost to the Executive, and at the same coverage level as in
effect as of the Executive’s Effective Date of Termination (subject to changes in
coverage levels applicable to all employees generally), a continuation of the Executive’s
(and the Executive’s eligible dependents’) health insurance coverage for twelve (12)
months from the Effective Date of Termination. The applicable COBRA health insurance
benefit continuation period shall begin coincident with the beginning of this benefit
continuation period;
	 
	 	 	 	The providing of these health insurance benefits by the Company shall be discontinued
prior to the end of the twelve (12) month continuation period to the extent that the
Executive becomes covered under the health insurance coverage of a subsequent employer
which does not contain any exclusion or limitation with respect to any preexisting
condition of the Executive or the Executive’s eligible dependents. For purposes of
enforcing this offset provision, the Executive shall have a duty to inform the Company
as to the terms and conditions of any subsequent employment and the corresponding
benefits earned from such employment. The Executive shall provide, or cause to provide,
to the Company in writing correct, complete, and timely information concerning the same;
and
	 
	 	(e)	 	All other benefits to which the Executive has a vested right at the time, according
to the provisions of the governing plan or program.

9

 

     Payment of the benefits described in Sections 7.4(a) and (c) shall be paid to the Executive in
a single lump sum as soon as practicable following the Effective Date of Termination in order to
avoid penalties and excise taxes under the requirements of Code Section 409A. The benefits
described in Section 7.4(b) shall be paid in cash to the Executive in equal monthly installments
over a twenty-four (24) month period. All other payments due to the Executive upon termination of
employment shall be paid in accordance with the terms of such applicable plans or program. With the
exception of the covenants referenced in Article 10 (which shall survive such termination), the
Company and the Executive thereafter shall have no further obligations under this Agreement.

     7.5 Termination for Cause. Nothing in this Agreement shall be construed to prevent the
Committee from terminating the Executive’s employment under this Agreement for Cause.

     In the event this Agreement is terminated by the Committee for Cause, the Company shall pay
the Executive his Base Salary and accrued vacation pay through the Effective Date of Termination,
and the Executive shall immediately thereafter forfeit all rights and benefits (other than vested
benefits) he would otherwise have been entitled to receive under this Agreement. The Company and
the Executive thereafter shall have no further obligations under this Agreement with the exception
of the covenants referenced in Article 10 herein (which shall survive such termination).

     7.6 Termination by the Company without Cause or by the Executive with Good Reason subsequent
to a Change in Control of the Company. If within two (2) years following the Change in Control of
the Company, the Company terminates the Executive’s employment for any reason other than death,
Disability, Retirement, or Cause or the Executive terminates employment for Good Reason, subject to
the Executive signing a waiver of all claims, the Company shall pay and provide to the Executive:

	 	(a)	 	An amount equal to the Executive’s accrued and unpaid Base Salary and accrued but
unused vacation pay through the Effective Date of Termination;
	 
	 	(b)	 	An amount equal to two (2) times the Executive’s annual Base Salary, at the Base
Salary amount in effect on the Effective Date of Termination;
	 
	 	(c)	 	An amount equal to two (2) times the Executive’s targeted Annual Bonus Award, at the
targeted Annual Bonus Award in effect on the Effective Date of Termination;
	 
	 	(d)	 	An amount that is equal to a prorated Annual Bonus Award based on the Executive’s
target bonus opportunity established for the fiscal year in which termination of
employment occurs. The prorated amount shall be determined as a function of time within
the fiscal year that has elapsed prior to the Executive’s Effective Date of Termination;

10

 

	 	(e)	 	At the exact same cost to the Executive, and at the same coverage level as in effect
as of the Executive’s Effective Date of Termination (subject to changes in coverage levels
applicable to all employees generally), a continuation of the Executive’s (and the
Executive’s eligible dependents’) health insurance coverage for twenty four (24) months
from the Effective Date of Termination. The applicable COBRA health insurance benefit
continuation period shall begin coincident with the beginning of this benefit continuation
period;
	 
	 	 	 	The providing of these health insurance benefits by the Company shall be discontinued
prior to the end of the twenty four (24) month continuation period to the extent that
the Executive becomes covered under the health insurance coverage of a subsequent
employer which does not contain any exclusion or limitation with respect to any
preexisting condition of the Executive or the Executive’s eligible dependents. For
purposes of enforcing this offset provision, the Executive shall have a duty to inform
the Company as to the terms and conditions of any subsequent employment and the
corresponding benefits earned from such employment. The Executive shall provide, or
cause to provide, to the Company in writing correct, complete, and timely information
concerning the same; and
	 
	 	(f)	 	All other benefits to which the Executive has a vested right at the time, according
to the provisions of the governing plan or program.

     Payment of the benefits described in Sections 7.6(a), (b), (c), and (d) shall be paid to the
Executive in a single lump sum as soon as practicable following the Effective Date of Termination
in order to avoid penalties and excise taxes under the requirements of Code Section 409A. All other
payments due to the Executive upon termination of employment shall be paid in accordance with the
terms of such applicable plans or program. With the exception of the covenants referenced in
Article 10 (which shall survive such termination), the Company and the Executive thereafter shall
have no further obligations under this Agreement.

Article 8. Assignment

     8.1 Assignment by Company. This Agreement may and shall be assigned or transferred
to, and shall be binding upon and shall inure to the benefit of any successor company. Any
such successor company shall be deemed substituted for all purposes of the “Company” under the
terms of this Agreement. Notwithstanding such assignment, the Company shall remain, with such
successor company, jointly and severally liable for all its obligations hereunder.

     Failure of the Company to obtain the agreement of any successor company to be bound by the
terms of this Agreement prior to the effectiveness of any such succession shall be a breach of this
Agreement, and shall immediately entitle the Executive to benefits from the Company in the same
amount and on the same terms as the Executive would be entitled to receive in the event of a
termination of employment without Cause as provided in Section 7.4. Except as herein provided, this
Agreement may not otherwise be assigned by the Company.

11

 

     8.2 Assignment by Executive. This Agreement shall inure to the benefit of and be enforceable
by the Executive’s personal or legal representatives, executors, administrators, successors, heirs,
distributees, devisees, and legatees. If the Executive dies while any amount would still be payable
to him hereunder had he continued to live, all such amounts, unless otherwise provided herein,
shall be paid in accordance with the terms of this Agreement, to the Executive’s Beneficiary. If
the Executive has not named a Beneficiary, then such amounts shall be paid to the Executive’s
estate.

Article 9. Notice and Dispute Resolution

     9.1 Notice. Any notices, requests, demands, or other communications provided by this
Agreement shall be sufficient if in writing and if sent by registered or certified mail to the
Executive at the last address he has filed in writing with the Company or, in the case of the
Company, at its principal offices.

     9.2 Dispute Resolution. With the exception of a dispute relating to any violation of a
restrictive covenant as referenced in Article 10 of this Agreement, any dispute or controversy
arising under or in connection with this Agreement shall be settled by arbitration. The arbitration
shall be conducted before a panel of three (3) arbitrators sitting in a location selected by the
Executive within fifty (50) miles from the location of his job with the Company and in accordance
with the rules of the American Arbitration Association then in effect. The decision of the
arbitrators shall be binding on both the Company and Executive. Judgment may be entered on the
award of the arbitrators in any court having jurisdiction. Payment of any expenses for such
arbitration, including the legal fees and expenses incurred by Executive, shall be determined by
the arbitrator in their decision.

Article 10. Confidentiality, Noncompetition, and Nonsolicitation

     This Agreement shall not supersede or nullify in any way the Employee Confidentiality,
Noncompetition, Nonsolicitation Agreement executed by the Executive on April 14, 2005 and again on
subsequent dates. The Employee Confidentiality, Noncompetition, Nonsolicitation Agreement shall
remain in full force and effect and any requirements of such agreement shall be incorporated by
reference into this Agreement.

Article 11. Miscellaneous

     11.1 Entire Agreement. This Agreement supersedes any prior agreements or
understandings, oral or written, between the parties hereto or between the Executive and the
Company, with respect to the subject matter hereof, and constitutes the entire agreement of the
parties with respect thereto.

     11.2 Amendment or Modification. This Agreement shall not be varied, altered, modified,
canceled, changed, or in any way amended except by mutual agreement of the parties in a written
instrument executed by the parties hereto or their legal representatives. Notwithstanding the
foregoing, the Committee may amend the Agreement, to take effect retroactively or otherwise, as
deemed necessary or advisable for the purpose of conforming the Agreement to any present or future
law relating to Agreements of this or similar nature (including, but not limited to, Code Section
409A), and to the administrative regulations and rulings promulgated thereunder.

     11.3 Severability. In the event that any provision or portion of this Agreement shall be
determined to be invalid or unenforceable for any reason, the remaining provisions of this
Agreement shall be unaffected thereby and shall remain in full force and effect.

12

 

     11.4 Counterparts. This Agreement may be executed in one (1) or more counterparts, each of
which shall be deemed to be an original, but all of which together will constitute one and the same
Agreement.

     11.5 Tax Withholding. The Company may withhold from any benefits payable under this Agreement
all federal, state, city, or other taxes as may be required pursuant to any law or governmental
regulation or ruling.

     11.6 Beneficiaries. Any payments or benefits hereunder due to the Executive at the time of his
death shall nonetheless be paid or provided and the Executive may designate one or more individuals
or entities as the primary and/or contingent Beneficiaries of any amounts to be received under this
Agreement. Such designation must be in the form of a signed writing acceptable to the Committee.
The Executive may make or change such designation at any time.

     11.7 Payment Obligation Absolute. All amounts payable by the Company hereunder shall be paid
without notice or demand. Subject to the covenants set forth in Article 10 and Section 7.4(e), each
and every payment made hereunder by the Company shall be final, and the Company shall not seek to
recover all or any part of such payment from the Executive or from whomsoever may be entitled
thereto, for any reasons whatsoever.

     The restrictive covenants referenced in Article 10 are independent of any other contractual
obligations in this Agreement or otherwise owed by the Company to the Executive. Except as provided
in this paragraph, the existence of any claim or cause of action by Executive against the Company,
whether based on this Agreement or otherwise, shall not create a defense to the enforcement by the
Company of any restrictive covenant contained herein.

     Except as provided in Section 7.4(e), the Executive shall not be obligated to seek other
employment in mitigation of the amounts payable or arrangements made under any provision of this
Agreement, and the obtaining of any such other employment shall in no event effect any reduction of
the Company’s obligations to make the payments and arrangements required to be made under this
Agreement.

     11.8 Contractual Rights to Benefits. Subject to approval by the Committee, this Agreement
establishes and vests in the Executive a contractual right to the benefits to which he is entitled
hereunder. However, nothing herein contained shall require or be deemed to require, or prohibit or
be deemed to prohibit, the Company to segregate, earmark, or otherwise set aside any funds or other
assets, in trust or otherwise, to provide for any payments to be made or required hereunder.

     11.9 Specific Performance. The Executive acknowledges that the obligations undertaken by him
pursuant to this Agreement are unique and that the Company will likely have no adequate remedy at
law if the Executive shall fail to perform any of his obligations hereunder. The Executive
therefore confirms that the Company’s right to specific performance of the terms of this Agreement
is essential to protect the rights and interests of the Company. Accordingly, in addition to any
other remedies that the Company may have at law or in equity, the Company shall have the right to
have all obligations, covenants, agreements, and other provisions of this Agreement specifically
performed by the Executive and the Company shall have the right to obtain preliminary injunctive
relief to secure specific performance and to prevent a breach or contemplated breach of this
Agreement by the Executive.

13

 

     11.10 Voiding of Agreement Provision. If any provision under this Agreement causes an amount
to be considered deferred under Code Section 409A and as such become subject to income tax, excise
tax, or penalties under the Code prior to the time such amount is paid to the Executive, such
amount shall be deemed null and void with respect to such amount deferred and the Committee may
amend or modify this Agreement in order to accomplish the objectives of the Agreement without
causing early taxation of such amounts and without the Company incurring additional cost or
liability.

Article 12. Governing Law

     To the extent not preempted by federal law, the provisions of this Agreement shall be
construed and enforced in accordance with 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 the
Agreement to the substantive law of another jurisdiction.

Article 13. Indemnification

     The Company hereby covenants and agrees to indemnify and hold harmless the Executive
against and in respect to any and all actions, suits, proceedings, claims, demands, judgments,
costs, expenses, losses, and damages resulting from the Executive’s performance of his duties and
obligations under the terms of this Agreement; provided however, the Executive acted in good faith
and in a manner he reasonably believed to be in or not opposed to the best interests of the Company
or its shareholders, and with respect to a criminal action or proceeding, the Executive had no
reasonable cause to believe his conduct was unlawful.

	 	 	 	 	 
	 	 	Executive:
	 
	 	 	 	 
	 	 	 
	 	 	Christopher Nagel
	 
	 	 	 	 
	 

	 	Date:	 	 
	 

	 	 	 	 
	 
	 	 	 	 
	 	 	The Scotts Miracle-Gro Company
	 
	 	 	 	 
	 	 	 
	 	 	Representative of the Board of Directors
	 
	 	 	 	 
	 

	 	Date:	 	 
	 

	 	 	 	 

14

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