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This excerpt taken from the SMG DEF 14A filed Dec 19, 2008. CERTAIN
RELATIONSHIPS AND RELATED TRANSACTIONS
Effective as of October 1, 2008, Scotts LLC entered into a
“time sharing agreement,” as that term is defined in
the provisions of 14 C.F.R. § 91.501(b)(6) and
(c)(1), as amended, with each of James Hagedorn, the Chief
Executive Officer and Chairman of the Board of the Company, and
Mark R. Baker, the President and Chief Operating Officer of the
Company. Each agreement permits the applicable executive officer
to purchase a maximum number of flight hours on Company-owned
aircraft for personal use at the Company’s incremental
direct operating cost per flight hour.
Under the terms of his agreement, Mr. Hagedorn has the
option to purchase from the Company up to
100 Falcon-equivalent aircraft hours (including ferry
hours). The maximum total dollar value of the transaction,
assuming Mr. Hagedorn exercises his option with respect to
all 100 Falcon-equivalent hours, would be approximately
$340,000. Under the terms of his agreement, Mr. Baker has
the option to purchase from the Company up to 50 aircraft hours.
The maximum total dollar value of the transaction, assuming
Mr. Baker exercises his option with respect to all
50 hours, would be approximately $170,000.
The terms of the agreements are governed by the rules of the
Federal Aviation Administration (the “FAA”). Under the
terms of the agreements, the Company remains responsible for
providing licensed and qualified pilots, maintaining the
aircraft in airworthy operating condition, and carrying in full
force and effect
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public liability, property damage, “all-risk” hull and
any other necessary policies of insurance in respect of the
aircraft naming each executive as an additional insured.
Nancy G. Mistretta, a member of the Board of Directors, is
employed by Russell Reynolds Associates, a firm used by the
Company and its subsidiaries for executive employment searches.
Ms. Mistretta is not involved directly or indirectly in a
supervisory role with respect to the services provided for the
Company’s or its subsidiaries’ accounts but may be
deemed to have an indirect interest in the arrangements between
the Company and its subsidiaries and Russell Reynolds Associates
given her position as a member of Russell Reynolds Associates.
During the 2008 fiscal year, Scotts LLC paid approximately
$254,000 in fees to Russell Reynolds Associates.
This excerpt taken from the SMG DEF 14A filed Dec 20, 2007. CERTAIN
RELATIONSHIPS AND RELATED TRANSACTIONS
Scotts LLC subleases a portion of a building to the Hagedorn
Partnership at a rent of $1,437 per month plus payment for
communication services. The Hagedorn Partnership provides
personnel, equipment and supplies to support Scotts LLC
activities at that office. Under these arrangements, during the
2007 fiscal year, Scotts LLC paid $60,000 to the Hagedorn
Partnership and was paid $45,725 by the Hagedorn Partnership.
Nancy G. Mistretta, a member of the Board of Directors, is
employed by Russell Reynolds Associates, a firm used by the
Company and its subsidiaries for executive employment searches.
Ms. Mistretta is not involved directly or indirectly in a
supervisory role with the services provided for the
Company’s or its subsidiaries’ accounts and has an
indirect interest in the arrangements between Russell Reynolds
Associates and the Company and its subsidiaries solely through
her position as a member of Russell Reynolds Associates.
Ms. Mistretta joined the Company’s Board of Directors
on August 9, 2007. During the 2007 fiscal year, Scotts LLC
paid approximately $650,000 in fees to Russell Reynolds
Associates.
This excerpt taken from the SMG DEF 14A filed Dec 20, 2006. CERTAIN
RELATIONSHIPS AND RELATED TRANSACTIONS
Paul Hagedorn, who, along with his brother, James Hagedorn, and
his sister, Katherine Hagedorn Littlefield, is a general partner
of the Hagedorn Partnership, is employed by Scotts LLC as a
graphics design specialist. During the 2006 fiscal year, Paul
Hagedorn received salary and bonus totaling $147,777 and
employment benefits and reimbursement for travel expenses
consistent with those offered to other associates of Scotts LLC.
James Hagedorn is the President and Treasurer and owns 100% of
the shares of Hagedorn Aviation Inc., a company which owns the
aircraft used for certain business travel by James Hagedorn and,
on occasion, certain other members of senior management of the
Company. Scotts LLC pays charges by Hagedorn Aviation Inc. for
flight time at the rate of $200 per hour of flight. The
charges cover the cost to operate and maintain the aircraft.
During the 2006 fiscal year, Scotts LLC paid a total of $19,800
to Hagedorn Aviation Inc. for such service, which constituted
more than five percent of Hagedorn Aviation Inc.’s
consolidated gross revenues for its last full fiscal year.
Scotts LLC subleases a portion of a building to the Hagedorn
Partnership at a rent of $1,437 per month plus payment for
communication services. The Hagedorn Partnership provides
personnel, equipment and supplies to support Scotts LLC
activities at that office. Under these arrangements, during the
2006 fiscal year, Scotts LLC paid $60,000 to the Hagedorn
Partnership and was paid $45,725 by the Hagedorn Partnership.
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