UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
D. C. 20549
FORM
11-K
(Mark
One)
|
R
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ANNUAL REPORT PURSUANT TO
SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
|
FOR THE FISCAL YEAR ENDED DECEMBER
31, 2008
OR
£ TRANSITION REPORT PURSUANT TO SECTION
15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
FOR THE TRANSITION PERIOD FROM
________________ TO _________________
COMMISSION
FILE NUMBERS 033-47073; 333-147397; 333-154364
|
A.
|
Full
title of the plan and the address of the plan, if different from that of
the issuer named below:
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The
Scotts Company LLC Retirement Savings Plan
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B.
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Name
of issuer of the securities held pursuant to the plan and the address of
its principal executive office:
|
The
Scotts Miracle-Gro Company
14111
Scottslawn Road
Marysville,
Ohio 43041
REQUIRED
INFORMATION
The following financial statements and
supplemental schedule for The Scotts Company LLC Retirement Savings Plan are
being filed herewith:
Audited
Financial Statements
Report of Independent Registered Public
Accounting Firm
Financial Statements:
Statements of Net Assets Available for
Benefits as of December 31, 2008 and 2007
Statements of Changes in Net Assets
Available for Benefits for the Years Ended December 31, 2008 and
2007
Notes to Financial
Statements
Supplemental Schedule:
Schedule of Assets Held for Investment
Purposes at End of Year
Note: Other
supplemental schedules required by Section 252.103-10 of the Department of
Labor’s Rules and Regulations for Reporting and Disclosure under ERISA have been
omitted because they are not applicable.
The
following exhibit is being filed herewith:
Exhibit No.
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|
Description
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23.1
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Consent
of Independent Registered Public Accounting Firm – Meaden & Moore,
Ltd.
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SIGNATURES
The Plan. Pursuant to the
requirements of the Securities Exchange Act of 1934, the trustees (or other
persons who administer the employee benefit plan) have duly caused this annual
report to be signed on its behalf by the undersigned, hereunto duly
authorized.
Date:
June 18, 2009
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By:
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/s/ DAVID C. EVANS
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Printed
Name: David C. Evans
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Title:
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Executive
Vice President and Chief
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Financial
Officer of The Scotts
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Miracle-Gro
Company
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THE
SCOTTS COMPANY LLC RETIREMENT SAVINGS PLAN
INDEX
TO THE FINANCIAL STATEMENTS December 31, 2008 and
2007
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PAGE NO.
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Report
of Independent Registered Public Accounting Firm
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5
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Financial
Statements:
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Statements
of Net Assets Available for Benefits
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6
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Statements
of Changes in Net Assets Available for Benefits
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7
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Notes
to Financial Statements
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8 –
16
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Supplemental
Schedule
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Schedule
of Assets Held for Investment Purposes at End of Year
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17
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NOTE:
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Other
supplement schedules required by Section 252.103-10 of the Department of
Labor’s Rules and Regulations for Reporting and Disclosure and ERISA have
been omitted because they are not
applicable.
|
To the
Participants and Administrator of
The
Scotts Company LLC Retirement Savings Plan
Marysville,
Ohio
We have
audited the accompanying Statements of Net Assets Available for Benefits
of THE SCOTTS COMPANY LLC RETIREMENT SAVINGS PLAN as of December 31, 2008
and 2007 and the related Statements of Changes in Net Assets Available for
Benefits for the years then ended. These financial statements are the
responsibility of the Plan's management. Our responsibility is to
express an opinion on these financial statements based on our
audits.
We
conducted our audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require
that we plan and perform the audit to obtain reasonable assurance about whether
the financial statements are free of material misstatement. The Plan is not
required to have, nor were we engaged to perform, an audit of its internal
control over financial reporting. Our audits included consideration
of internal control over financial reporting as a basis for designing audit
procedures that are appropriate in the circumstances, but not for the purpose of
expressing an opinion on the effectiveness of the Plan's internal control over
financial reporting. Accordingly, we express no such
opinion. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation. We believe
that our audits provide a reasonable basis for our opinion.
In 2008,
the Plan adopted Statement of Financial Accounting Standards ("SFAS") No. 157,
"Fair Value Measurements."
In our
opinion, the financial statements referred to above present fairly, in all
material respects, the net assets available for benefits of THE SCOTTS
COMPANY LLC RETIREMENT SAVINGS PLAN as of December 31, 2008 and 2007, and the
changes in its net assets available for benefits for the years then ended, in
conformity with accounting principles generally accepted in the United States of
America.
Our
audits were performed for the purpose of forming an opinion on the financial
statements taken as a whole. The accompanying supplemental schedule
of assets (held at end of year) as of December 31, 2008, is presented for the
purpose of additional analysis and is not a required part of the financial
statements but is supplemental information required by the Department of Labor's
Rules and Regulations for Reporting and Disclosure under the Employee
Retirement Income Security Act of 1974. The supplemental schedule is
the responsibility of the Plan's management. The supplemental
information has been subjected to the auditing procedures applied in our audits
of the financial statements and, in our opinion, is fairly stated in all
material respects in relation to the financial statements taken as a
whole.
/s/
MEADEN & MOORE, LTD.
Certified
Public Accountants
June 18,
2009
Cleveland,
Ohio
The
Scotts Company LLC
Retirement
Savings Plan
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|
December
31
|
|
|
|
2008
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|
|
2007
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ASSETS
|
|
|
|
|
|
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Receivables:
|
|
|
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|
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Employee
contribution receivable
|
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$ |
- |
|
|
$ |
675 |
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Other
receivable
|
|
|
443,701 |
|
|
|
18,728 |
|
|
|
|
443,701 |
|
|
|
19,403 |
|
Investments,
at Fair Value:
|
|
|
|
|
|
|
|
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Alger
Small Mid Cap Growth
|
|
|
6,724,767 |
|
|
|
- |
|
Brandywine
Blue Fund
|
|
|
14,156,293 |
|
|
|
- |
|
CRM
Small Cap Value Fund
|
|
|
2,862,183 |
|
|
|
3,334,050 |
|
Dodge
and Cox Stock Fund
|
|
|
9,765,399 |
|
|
|
17,596,623 |
|
EuroPacific
Growth Fund-Class A
|
|
|
11,624,894 |
|
|
|
19,174,580 |
|
Fidelity
Blue Chip Fund
|
|
|
- |
|
|
|
22,712,543 |
|
Fidelity
Contrafund
|
|
|
17,002,131 |
|
|
|
26,696,055 |
|
Fidelity
Freedom Income Fund
|
|
|
1,043,399 |
|
|
|
1,134,444 |
|
Fidelity
Freedom 2000 Fund
|
|
|
1,007,261 |
|
|
|
1,071,999 |
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Fidelity
Freedom 2005 Fund
|
|
|
244,098 |
|
|
|
329,790 |
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Fidelity
Freedom 2010 Fund
|
|
|
3,476,500 |
|
|
|
5,055,818 |
|
Fidelity
Freedom 2015 Fund
|
|
|
920,556 |
|
|
|
535,376 |
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Fidelity
Freedom 2020 Fund
|
|
|
7,736,200 |
|
|
|
10,950,002 |
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Fidelity
Freedom 2025 Fund
|
|
|
433,376 |
|
|
|
58,106 |
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Fidelity
Freedom 2030 Fund
|
|
|
4,641,508 |
|
|
|
6,357,045 |
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Fidelity
Freedom 2035 Fund
|
|
|
579,837 |
|
|
|
210,102 |
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Fidelity
Freedom 2040 Fund
|
|
|
1,932,828 |
|
|
|
2,050,515 |
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Fidelity
Freedom 2045 Fund
|
|
|
462,932 |
|
|
|
59,141 |
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Fidelity
Freedom 2050 Fund
|
|
|
342,636 |
|
|
|
180,548 |
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Fidelity
Low Price Stock Fund
|
|
|
4,161,756 |
|
|
|
6,374,267 |
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Fidelity
Managed Income Portfolio
|
|
|
25,959,768 |
|
|
|
25,182,677 |
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Fidelity
Puritan Fund
|
|
|
14,350,038 |
|
|
|
23,140,365 |
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Managers
Special Equity Fund
|
|
|
- |
|
|
|
13,468,313 |
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PIMCO
Total Return Fund
|
|
|
10,098,911 |
|
|
|
5,892,397 |
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Spartan
U.S. Equity Index Fund
|
|
|
11,693,057 |
|
|
|
19,832,975 |
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The
Scotts Miracle-Gro Company Common Shares
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|
|
14,920,430 |
|
|
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16,449,323 |
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Participant
Loans
|
|
|
6,413,780 |
|
|
|
6,123,133 |
|
|
|
|
|
|
|
|
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Total
Investments
|
|
|
172,554,538 |
|
|
|
233,970,187 |
|
|
|
|
|
|
|
|
|
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Total
Assets
|
|
|
172,998,239 |
|
|
|
233,989,590 |
|
|
|
|
|
|
|
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LIABILITIES
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
|
|
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Net
Assets Available for Benefits at Fair Value
|
|
|
172,998,239 |
|
|
|
233,989,590 |
|
|
|
|
|
|
|
|
|
|
Adjustment
from fair value to contract value for the Fidelity Managed Income
Portfolio,
a
fully benefit-responsive investment contract
|
|
|
1,400,322 |
|
|
|
273,673 |
|
|
|
|
|
|
|
|
|
|
Net
Assets Available for Benefits
|
|
$ |
174,398,561 |
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|
$ |
234,263,263 |
|
See
accompanying notes.
STATEMENTS
OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
The
Scotts Company LLC
Retirement
Savings Plan
|
|
Year Ended December 31
|
|
|
|
2008
|
|
|
2007
|
|
Additions
to Net Assets Attributed to:
|
|
|
|
|
|
|
Contributions:
|
|
|
|
|
|
|
Employer
|
|
$ |
11,823,896 |
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|
$ |
10,150,672 |
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Participant
|
|
|
11,908,349 |
|
|
|
11,335,621 |
|
Rollovers
|
|
|
1,436,284 |
|
|
|
2,239,639 |
|
|
|
|
25,168,529 |
|
|
|
23,725,932 |
|
|
|
|
|
|
|
|
|
|
Interest
on participant loans
|
|
|
482,131 |
|
|
|
412,588 |
|
Interest
and dividend income
|
|
|
7,489,583 |
|
|
|
20,519,192 |
|
|
|
|
|
|
|
|
|
|
Total
Additions
|
|
|
33,140,243 |
|
|
|
44,657,712 |
|
|
|
|
|
|
|
|
|
|
Deductions
from Net Assets Attributed to:
|
|
|
|
|
|
|
|
|
Benefits
paid to participants
|
|
|
21,343,143 |
|
|
|
21,649,937 |
|
Net
depreciation of investments
|
|
|
71,572,929 |
|
|
|
7,129,322 |
|
Administrative
expenses
|
|
|
60,676 |
|
|
|
52,139 |
|
|
|
|
|
|
|
|
|
|
Total
Deductions
|
|
|
92,976,748 |
|
|
|
28,831,398 |
|
|
|
|
|
|
|
|
|
|
Net
(Decrease) Increase before Plan Transfer
|
|
|
(59,836,505 |
) |
|
|
15,826,314 |
|
|
|
|
|
|
|
|
|
|
Plan
Transfer
|
|
|
(28,197 |
) |
|
|
- |
|
|
|
|
|
|
|
|
|
|
Net
Assets Available for Benefits:
|
|
|
|
|
|
|
|
|
Beginning
of Year
|
|
|
234,263,263 |
|
|
|
218,436,949 |
|
|
|
|
|
|
|
|
|
|
End
of Year
|
|
$ |
174,398,561 |
|
|
$ |
234,263,263 |
|
See
accompanying notes.
NOTES TO
FINANCIAL STATEMENTS
The
Scotts Company LLC
Retirement
Savings Plan
NOTE
1. DESCRIPTION OF PLAN
The
following description of The Scotts Company LLC Retirement Savings Plan (the
"Plan") provides only general information. Participants should refer
to the Plan document for a complete description of the Plan's provisions, such
as eligibility, vesting, allocation and funding.
General:
The Plan
is a defined contribution plan covering all employees of The Scotts Company LLC
(the "Company") who meet the eligibility requirements. It is subject
to the provisions of the Employee Retirement Income Security Act of 1974
(ERISA).
Eligibility:
Domestic
employees (other than employees of EG Systems, Inc.) including seasonal
associates of the Company are eligible to participate in the Plan on the first
day of the month coinciding with or immediately following their date of
employment. Employees of EG Systems, Inc. (including seasonal
associates) doing business as Scotts LawnService®, a subsidiary of the Company,
are eligible to receive base retirement contributions on the first day of the
month after completing one year of eligible service and are eligible to make
contributions and receive matching contributions on the first day of the month
coinciding with or after completing 60 days of service. Effective
January 1, 2003, temporary employees are not eligible to participate in the
Plan.
Employee
Contributions:
The Plan
provides for a participant to make pre-tax contributions up to 75% of eligible
wages, not to exceed the annual Internal Revenue Service ("IRS") maximum
deferral amount. The maximum pre-tax contributions for the
years ended December 31, 2008 and 2007 were $15,500. The Plan also
provides that participants who are projected to be age 50 or older by the end of
the calendar year and who are making deferral contributions to the Plan may also
make catch-up contributions of up to $5,000 during each of the years ended
December 31, 2008 and 2007.
Employer
Contributions:
The Plan
provides a base retirement contribution for all eligible
employees. Generally, eligible employees receive an allocation equal
to 2% of monthly compensation. This percentage increases to 4% when
employees' year-to-date compensation exceeds 50% of the social security taxable
wage base. The Company also matches participant pre-tax contributions
dollar for dollar for the first 3% of pay and matches $0.50 on the dollar for
the next 2% of participant pre-tax contributions.
Contributions
are subject to limitations on annual additions and other limitations imposed by
the Internal Revenue Code as defined in the Plan agreement.
Participants'
Accounts:
401(k)
Accounts - Each participant's account is credited with the participant's
elective contributions, employer base and matching contributions, earnings and
losses thereon.
NOTES TO
FINANCIAL STATEMENTS
The
Scotts Company LLC
Retirement
Savings Plan
Rollover
contributions from other plans are also accepted provided certain specified
conditions are met.
Vesting:
All
participants are immediately vested in their contributions plus actual earnings
thereon. Matching and transition contributions made by the Company
vest immediately. However, base contributions made by the Company
vest after three years of service or immediately upon death, attainment of age
65 or permanent and total disability.
Forfeitures:
The
non-vested portions of participant account balances are forfeitable and used to
reduce employer contributions to the Plan. Plan forfeitures used
totaled $212,233 and $767,029 for the years ended December 31, 2008 and 2007,
respectively.
Participants'
Loans:
Loans are
permitted under certain circumstances and are subject to
limitations. Participants may borrow from their account up to a
maximum equal to the lesser of $50,000 or 50% of their account
balance. Loans are repaid over a period not to exceed 5
years. The loans are secured by the balance in the participant's
account and bear interest at rates established by Fidelity Pricing and Cash
Management Services. Principal and interest are paid ratably through
monthly payroll deductions.
Other
Plan Provisions:
Normal
retirement age is 65; however the Plan also provides for in-service withdrawals
for active employees under certain circumstances.
Payment
of Benefits:
Participants
are eligible to receive benefit payments upon termination, retirement, death or
disability equal to the vested balance of the participant's account as of the
business day the trustee processes the distribution.
Hardship
Withdrawals:
Hardship
withdrawals are permitted in accordance with Internal Revenue Service
guidelines.
Investment
Options:
Upon
enrollment in the Plan, a participant may direct their contributions in any or
all of the investment options under the Plan.
NOTES TO
FINANCIAL STATEMENTS
The
Scotts Company LLC
Retirement
Savings Plan
NOTE
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis
of Accounting:
The
financial statements of the Plan have been prepared on the accrual basis of
accounting in accordance with generally accepted accounting
principles.
Investments:
The
Plan’s investments are stated at fair value. Quoted market prices are used to
value investments. Shares of mutual funds are valued at the net asset value of
shares held by the Plan at year-end.
As
described in Financial Accounting Standards Board Staff Position, FSP AAG INV-1
and SOP 94-4-1, "Reporting of Fully Benefit-Responsive Investment Contracts Held
by Certain Investment Companies Subject to the AICPA Investment Company Guide
and Defined-Contribution Health and Welfare and Pension Plans" (the FSP),
investment contracts held by a defined-contribution plan are required to be
reported at fair value. However, contract value is the relevant measurement
attribute for that portion of the net assets available for benefits of a
defined-contribution plan attributable to fully benefit-responsive investment
contracts because contract value is the amount participants would receive if
they were to initiate permitted transactions under the terms of the Plan. As
required by the FSP, the Statements of Net Assets Available for Benefits present
the fair value of the investment contracts as well as the adjustment of the
fully benefit-responsive investment contracts from fair value to contract value.
The Statements of Changes in Net Assets Available for Benefits are prepared on a
contract value basis.
The fair
value of the wrapper investment is calculated by discounting the related cash
flows based on current yields of similar instruments with comparable
durations.
Participants'
loans are valued at their outstanding balances, which approximates fair
value.
Cash
equivalents include short-term investments with original term to maturity of 90
days or less. Cost approximates fair value.
The Plan
presents in the Statements of Changes in Net Assets Available for Benefits the
net appreciation or depreciation in the fair value of its investments, which
consists of the realized gains or losses and the unrealized appreciation or
depreciation on those investments. Gains and losses on sales of
investments are based on the average cost method.
Use
of Estimates:
The
preparation of financial statements in conformity with generally accepted
accounting principles requires the Plan to make estimates and assumptions that
affect the reported amounts of net assets available for benefits at the date of
the financial statements, changes in net assets available for benefits during
the reporting period and, when applicable, disclosures of contingent assets and
liabilities at the date of the financial statements. Actual results
could differ from those estimates.
Payments
of Benefits:
Benefits
are recorded when paid.
NOTES
TO FINANCIAL STATEMENTS
The
Scotts Company LLC
Retirement
Savings Plan
Administrative
Fees:
The
Company pays for all administrative fees except those that are participant
specific, such as loan establishment and maintenance fees.
Risks
and Uncertainties:
The Plan
provides various investment options, which are subject to various risks, such as
interest rate, market and credit risks. Due to the level of risk
associated with certain investment securities, it is at least reasonably
possible that changes in the values of investment securities will occur in the
near-term and that such changes could materially affect participant account
balances and the amounts reported in the Statements of Net Assets Available for
Benefits.
NOTE
3. INVESTMENTS
The
following fair values of the investments individually represent 5% or more of
net assets available for benefits as of December 31:
|
|
2008
|
|
|
2007
|
|
Fidelity
Managed Income Portfolio
|
|
$ |
25,959,768 |
|
|
$ |
25,182,677 |
|
Fidelity
Contrafund
|
|
|
17,002,131 |
|
|
|
26,696,055 |
|
The
Scotts Miracle-Gro Company Common Shares
|
|
|
14,920,430 |
|
|
|
16,449,323 |
|
Fidelity
Puritan Fund
|
|
|
14,350,038 |
|
|
|
23,140,365 |
|
Brandywine
Blue Fund
|
|
|
14,156,293 |
|
|
NA
|
|
Spartan
U.S. Equity Index Fund
|
|
|
11,693,057 |
|
|
|
19,832,975 |
|
EuroPacific
Growth Fund-Class A
|
|
|
11,624,894 |
|
|
|
19,174,580 |
|
PIMCO
Total Return Fund
|
|
|
10,098,911 |
|
|
NA
|
|
Dodge
and Cox Stock Fund
|
|
|
9,765,399 |
|
|
|
17,596,623 |
|
Fidelity
Blue Chip Fund
|
|
NA
|
|
|
|
22,712,543 |
|
Managers
Special Equity Fund
|
|
NA
|
|
|
|
13,468,313 |
|
NOTE
4. INVESTMENT CONTRACT WITH FIDELITY PRICING AND CASH MANAGEMENT
SERVICES
The Plan
holds a stable value investment contract, Fidelity Managed Income Portfolio,
(the "Portfolio") with Fidelity Pricing Cash Management Services, the Trustee.
The Portfolio is an open-end commingled pool dedicated exclusively to the
management of assets of defined contribution plans. The Portfolio
invests in underlying assets (typically fixed-income securities or bond funds
and may include derivative instruments such as futures contracts and swap
agreements) and enters into "wrapper" contracts issued by a third
party. The account is credited with earnings on the underlying
investments and charged for participant withdrawals and administrative
expenses. The wrap issuer agrees to pay the Portfolio an amount
sufficient to cover unit holder redemptions and certain other payments (such as
portfolio expenses), provided all the terms of the wrapper have been met.
Wrappers are normally purchased from issuers rated in the top three long-term
rating categories (A- or the equivalent and above). The purpose of
the wrappers is to preserve the investors’ principal investment while earning
interest income, providing more stabilization than a traditional
investment.
NOTES TO
FINANCIAL STATEMENTS
The
Scotts Company LLC
Retirement
Savings Plan
As
described in Note 2, because the stable value investment contract is fully
benefit-responsive, contract value is the relevant measurement attribute for
that portion of the net assets available for benefits attributable to the stable
value investment contract. Contract value, as reported by Fidelity
Pricing and Cash Management Services, represents contributions made under the
contract, plus earnings, less participant withdrawals and administrative
expenses. Participants may ordinarily direct the withdrawal or
transfer of all or a portion of their investment at contract value.
There are
no reserves against contract value for credit risk of the contract issuer or
otherwise. The crediting interest rate is based on a formula agreed upon with
the issuer. Such interest rates are reviewed on a quarterly basis for
resetting.
Certain
events may limit the ability of the Plan to transact at contract value with the
issuer. Such events include the following: (1) amendments to the Plan documents
(including complete or partial plan termination or merger with another plan),
(2) changes to Plan’s prohibition on competing investment options or deletion of
equity wash provisions, (3) bankruptcy of the Plan sponsor or other Plan sponsor
events (for example, divestitures or spin-offs of a subsidiary) that cause a
significant withdrawal from the Plan, or (4) the failure of the trust to qualify
for exemption from federal income taxes or any required prohibited transaction
exemption under Employee Retirement Income Security Act of 1974. The Plan
administrator does not believe that the occurrence of any such value event,
which would limit the Plan’s ability to transact at contract value with
participants, is probable.
The stable
value investment contract does not permit Fidelity Pricing and Cash
Management Services to terminate the agreement prior to the scheduled maturity
date.
The
following are the average yields for the stable value investment
contract for 2008 and 2007:
Average
Yields:
|
|
2008
|
|
|
2007
|
|
Based
on actual earnings
|
|
|
3.74 |
% |
|
|
4.31 |
% |
Based
on interest rates credited to participants
|
|
|
3.04 |
% |
|
|
4.40 |
% |
NOTE
5. TAX STATUS
The Plan
obtained a determination letter dated September 24, 2003, in which the Internal
Revenue Service stated that the Plan, as amended through February 4, 2002, was
in compliance with the applicable requirements of the Internal Revenue
Code. The Plan administrator, the Company and the Plan's legal
counsel believe that the Plan is designed and has been operated in compliance
with the applicable requirements of the Internal Revenue Code. On
January 31, 2007, the Company applied for a new determination letter to cover
all amendments to the Plan subsequent to February 4,
2002. Accordingly, no provision for federal income taxes has been
made. Subsequent to year end, the Plan received an updated
determination letter dated March 6, 2009 that covered the latest
amendments to the Plan.
NOTE
6. PLAN TERMINATION
Although
it has not expressed any intent to do so, the Company has the right under the
Plan to terminate the Plan or its contributions subject to the provisions of
ERISA. In the event the Plan is terminated, participants will become
fully vested in their accounts.
NOTES TO
FINANCIAL STATEMENTS
The
Scotts Company LLC
Retirement
Savings Plan
NOTE
7. RECONCILIATION OF FINANCIAL STATEMENTS TO FORM 5500
The
following is a reconciliation of net assets available for benefits per the
financial statements to the Form 5500:
|
|
2008
|
|
|
2007
|
|
Net
assets available for benefits per the financial statements
|
|
$ |
174,398,561 |
|
|
$ |
234,263,263 |
|
|
|
|
|
|
|
|
|
|
Adjustment
from contract value to fair value for fully benefit-responsive investment
contracts
|
|
|
(1,400,322 |
) |
|
|
(273,673 |
) |
|
|
|
|
|
|
|
|
|
Net
assets available for benefits per the Form 5500
|
|
$ |
172,998,239 |
|
|
$ |
233,989,590 |
|
The
following is a reconciliation of investment income per the financial statements
to the Form 5500.
|
|
2008
|
|
Interest
and dividend income and net depreciation of investments per the financial
statements
|
|
$ |
(63,601,215 |
) |
|
|
|
|
|
Adjustment
from contract value to fair value for fully benefit-responsive investment
contracts-2008
|
|
|
(1,400,322 |
) |
|
|
|
|
|
Adjustment
from contract value to fair value for fully benefit-responsive investment
contracts-2007
|
|
|
273,673 |
|
|
|
|
|
|
Rounding
|
|
|
1 |
|
|
|
|
|
|
Net
investment loss per the Form 5500
|
|
$ |
(64,727,863 |
) |
NOTE
8. PARTY-IN-INTEREST TRANSACTIONS
Certain
Plan investments are shares of mutual funds managed by Fidelity Pricing and Cash
Management Services, the Trustee as defined by the Plan and therefore, these
transactions qualify as party-in-interest. Usual and customary fees
were paid by the mutual fund for the investment management
services.
NOTES TO
FINANCIAL STATEMENTS
The
Scotts Company LLC
Retirement
Savings Plan
NOTE
9. FAIR VALUE MEASUREMENTS
The Plan
adopted Statement of Financial Accounting Standards ("SFAS") No. 157, “Fair
Value Measurements” ("SFAS 157"), effective January 1, 2008, with respect to the
fair value measurement and disclosure of assets and liabilities. SFAS 157
defines fair value, establishes a framework for measuring fair value, and
expands disclosures about fair value measurements. SFAS 157 defines fair value
as the exchange price that would be received for an asset or paid to transfer a
liability (an exit price) in the principal or the most advantageous market for
the asset or liability in an orderly transaction between market participants at
the measurement date. SFAS 157 establishes a three-level fair value hierarchy
that prioritizes the inputs used to measure fair value. The hierarchy requires
entities to maximize the use of observable inputs and minimize the use of
unobservable inputs. The three levels of inputs in the fair value hierarchy
under SFAS 157 are as follows:
|
·
|
Level
1 – Inputs to the valuation methodology are unadjusted quoted prices for
identical assets or liabilities in active markets that the Plan has the
ability to access.
|
|
·
|
Level
2 – Inputs to the valuation methodology
include:
|
|
-
|
Quoted
prices for similar assets or liabilities in active
markets;
|
|
-
|
Quoted
prices for identical or similar assets or liabilities in inactive
markets;
|
|
-
|
Inputs
other than quoted prices that are observable for the asset or
liability;
|
|
-
|
Inputs
that are derived principally from or corroborated by observable market
data by correlation or other means.
|
If the
asset or liability has a specified (contractual) term, the Level 2 input must be
observable for substantially the full term of the asset or
liability.
|
·
|
Level
3 – Inputs to the valuation methodology are unobservable and significant
to the fair value measurement.
|
The
asset’s or liability’s fair value measurement level within the fair value
hierarchy is based on the lowest level of any input that is significant to the
fair value measurement.
Following
is a description of the valuation methodologies used for assets measured at fair
value. There have been no changes in the methodologies used at
December 31, 2008 and 2007.
|
·
|
Mutual
funds: Valued at the net asset value of shares held by the Plan
at year end.
|
|
·
|
Common
stocks: Valued at the closing price reported on the active
market on which the individual securities are
traded.
|
|
·
|
Participant
loans: Valued at amortized cost, which approximates fair
value.
|
|
·
|
Guaranteed
investment contracts: Valued at fair value by discounting the related cash
flows based on current yields of similar instruments with comparable
durations considering the credit worthiness of the issuer (See Note
2).
|
The
methods described above may produce a fair value calculation that may not be
indicative of net realizable value or reflective of future fair values.
Furthermore, while the Plan believes its valuation methods are appropriate and
consistent with other market participants, the use of different methodologies or
assumptions to determine the fair value of certain financial instruments could
result in a different fair value measurement at the reporting date.
NOTES TO
FINANCIAL STATEMENTS
The
Scotts Company LLC
Retirement
Savings Plan
The
following table presents the Company’s investments measured at fair value on a
recurring basis at December 31, 2008:
|
|
Level 1
|
|
|
Level 2
|
|
|
Level 3
|
|
|
Total
|
|
Mutual
funds
|
|
$ |
125,260,560 |
|
|
$ |
- |
|
|
$ |
- |
|
|
$ |
125,260,560 |
|
Common
stocks
|
|
|
14,920,430 |
|
|
|
- |
|
|
|
- |
|
|
|
14,920,430 |
|
Stable
value investment contracts
|
|
|
- |
|
|
|
25,959,768 |
|
|
|
- |
|
|
|
25,959,768 |
|
Participant
loans
|
|
|
- |
|
|
|
- |
|
|
|
6,413,780 |
|
|
|
6,413,780 |
|
Total investments
at fair value
|
|
$ |
140,180,990 |
|
|
$ |
25,959,768 |
|
|
$ |
6,413,780 |
|
|
$ |
172,554,538 |
|
The table below sets forth a
summary of changes in the fair value of the Plan's level 3 assets for the year
ended December 31, 2008:
|
|
Level 3 Assets
|
|
|
|
Year Ended December 31, 2008
|
|
|
|
Participant Loans
|
|
Balance,
beginning of year
|
|
$ |
6,123,133 |
|
Purchases,
sales, issuances and settlements (net)
|
|
|
290,647 |
|
Ending
Balance
|
|
$ |
6,413,780 |
|
NOTE
10. RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS
In March
2008, the FASB issued SFAS No. 161, "Disclosure about Derivative Instruments and
Hedging Activities" ("SFAS No. 161"), which amends the disclosure requirements
of SFAS No. 133, "Accounting for Derivative Instruments and Hedging
Activities." SFAS 161 requires increased disclosures about derivative
instruments and hedging activities and their effects on an entity's financial
position, financial performance, and cash flows. SFAS 161 is
effective for fiscal years beginning after November 15, 2008, with early
adoption permitted. SFAS 161 is not expected to have a material
impact on the Plan's financial statements.
In May
2008, the FASB issued SFAS No. 162, "The Hierarchy of Generally Accepted
Accounting Principles" ("SFAS 162"), which is intended to improve financial
reporting by identifying the sources of accounting principles and a consistent
framework, or hierarchy, for selecting accounting principles to be used in
preparing financial statements that are presented in conformity with U.S. GAAP
for nongovernmental entities. SFAS 162 will be effective 60 days
after U.S. Securities and Exchange Commission approves the Public Company
Accounting Oversight Board's amendments to AU section 411, "The Meaning of
Present Fairly in Conformity With Generally Accepted Accounting
Principles". SFAS 162 is not expected to have a material impact on
the Plan's financial statements.
NOTES TO
FINANCIAL STATEMENTS
The
Scotts Company LLC
Retirement
Savings Plan
In April
2009, the FASB issued three FASB Staff Positions, which provide additional
guidance and enhance disclosures regarding fair value measurements and
impairment of securities, FASB Staff Position No. FAS 107-1 and APB 28-1,
“Interim Disclosures about Fair Value Financial Instruments,” FASB Staff
Position No. FAS 115-2 and FAS 124-2, “Recognition and Presentation of
Other-Than-Temporary Impairments,” and FASB Staff Position No. FAS 157-4,
“Determining Fair Value When the Volume and Level of Activity for the Asset or
Liability Have Significantly Decreased and Identifying Transactions That Are Not
Orderly.” These staff positions 1) require that the fair value of all
financial instruments be disclosed in both interim and annual reporting periods;
2) modify the criteria used to assess other-than-temporary impairments (OTTI) of
debt securities and collectability of cash flows; 3) bifurcate the recognition
of OTTI between earnings and other comprehensive income; 4) require expanded and
more frequent disclosures about OTTI; 5) permit adjustments to estimated fair
values when, due to significant decrease in the volume and level of market
activity or evidence that a market is not orderly, the valuation technique does
not fairly present the price at which willing market participants would transact
at the measurement date; and 6) require disclosure about inputs and valuation
techniques used to measure fair value for both interim and annual reporting
periods. The staff positions are effective for interim reporting
periods ending after June 15, 2009, with early adoption
permitted. The sponsor has not determined the effect of adopting the
staff positions on the net assets available for benefits and changes in those
net assets.
SCHEDULE
OF ASSETS HELD FOR INVESTMENT PURPOSES AT END OF YEAR
Form
5500, Schedule H, Part IV, Line 4i
The
Scotts Company LLC
Retirement
Savings Plan
EIN
31-1414921
Plan
Number 001
December
31, 2008
|
|
(b) Identity of Issue,
|
|
(c) Description of Investment Including
|
|
|
|
|
(e)
|
|
|
|
Borrower, Lessor,
|
|
Maturity Date, Rate of Interest,
|
|
(d)
|
|
|
Current
|
|
(a)
|
|
or Similar Party
|
|
Collateral, Par or Maturity Value
|
|
Cost
|
|
|
Value
|
|
|
|
Alger
Small Mid Cap Growth
|
|
Registered
Investment Company
|
|
|
N/A
|
|
|
$ |
6,724,767 |
|
|
|
Brandywine
Blue Fund
|
|
Registered
Investment Company
|
|
|
N/A
|
|
|
|
14,156,293 |
|
|
|
CRM
Small Cap Value Fund
|
|
Registered
Investment Company
|
|
|
N/A
|
|
|
|
2,862,183 |
|
|
|
Dodge
and Cox Stock Fund
|
|
Registered
Investment Company
|
|
|
N/A
|
|
|
|
9,765,399 |
|
|
|
EuroPacific
Growth Fund-Class A
|
|
Registered
Investment Company
|
|
|
N/A
|
|
|
|
11,624,894 |
|
*
|
|
Fidelity
Contrafund
|
|
Registered
Investment Company
|
|
|
N/A
|
|
|
|
17,002,131 |
|
*
|
|
Fidelity
Freedom Income Fund
|
|
Registered
Investment Company
|
|
|
N/A
|
|
|
|
1,043,399 |
|
*
|
|
Fidelity
Freedom 2000 Fund
|
|
Registered
Investment Company
|
|
|
N/A
|
|
|
|
1,007,261 |
|
*
|
|
Fidelity
Freedom 2005 Fund
|
|
Registered
Investment Company
|
|
|
N/A
|
|
|
|
244,098 |
|
*
|
|
Fidelity
Freedom 2010 Fund
|
|
Registered
Investment Company
|
|
|
N/A
|
|
|
|
3,476,500 |
|
*
|
|
Fidelity
Freedom 2015 Fund
|
|
Registered
Investment Company
|
|
|
N/A
|
|
|
|
920,556 |
|
*
|
|
Fidelity
Freedom 2020 Fund
|
|
Registered
Investment Company
|
|
|
N/A
|
|
|
|
7,736,200 |
|
*
|
|
Fidelity
Freedom 2025 Fund
|
|
Registered
Investment Company
|
|
|
N/A
|
|
|
|
433,376 |
|
*
|
|
Fidelity
Freedom 2030 Fund
|
|
Registered
Investment Company
|
|
|
N/A
|
|
|
|
4,641,508 |
|
*
|
|
Fidelity
Freedom 2035 Fund
|
|
Registered
Investment Company
|
|
|
N/A
|
|
|
|
579,837 |
|
*
|
|
Fidelity
Freedom 2040 Fund
|
|
Registered
Investment Company
|
|
|
N/A
|
|
|
|
1,932,828 |
|
*
|
|
Fidelity
Freedom 2045 Fund
|
|
Registered
Investment Company
|
|
|
N/A
|
|
|
|
462,932 |
|
*
|
|
Fidelity
Freedom 2050 Fund
|
|
Registered
Investment Company
|
|
|
N/A
|
|
|
|
342,636 |
|
*
|
|
Fidelity
Low Price Stock Fund
|
|
Registered
Investment Company
|
|
|
N/A
|
|
|
|
4,161,756 |
|
*
|
|
Fidelity
Managed Income Portfolio
|
|
Common
Collective Trust
|
|
|
N/A
|
|
|
|
25,959,768 |
|
*
|
|
Fidelity
Puritan Fund
|
|
Registered
Investment Company
|
|
|
N/A
|
|
|
|
14,350,038 |
|
|
|
PIMCO
Total Return Fund
|
|
Registered
Investment Company
|
|
|
N/A
|
|
|
|
10,098,911 |
|
|
|
Spartan
U.S. Equity Index Fund
|
|
Registered
Investment Company
|
|
|
N/A
|
|
|
|
11,693,057 |
|
*
|
|
The
Scotts Miracle-Gro Company Common Shares
|
|
Employer
Securities
|
|
|
N/A
|
|
|
|
14,920,430 |
|
*
|
|
Participant
Loans
|
|
Notes
receivable (interest at rates ranging from 5.0% to 10%
due through January 13, 2014)
|
|
|
N/A
|
|
|
|
6,413,780 |
|
|
|
|
|
|
|
|
|
|
|
$ |
172,554,538 |
|
*
|
|
Party-in-interest
to the Plan.
|
|
|
|
|
|
|
|
|
|
|
THE
SCOTTS COMPANY LLC RETIREMENT SAVINGS PLAN
ANNUAL
REPORT ON FORM 11-K
FOR
FISCAL YEAR ENDED DECEMBER 31, 2008
INDEX TO
EXHIBITS
EXHIBIT NO.
|
|
DESCRIPTION
|
|
|
|
23.1
|
|
Consent
of Independent Registered Public Accounting
Firm – Meaden & Moore,
Ltd.
|