American Home Shield 2013 Annual Report Download - page 214

Exhibit 10.46
Mr. William Derwin
President, Terminix
Subject: Severance Agreement
Dear Bill:
This letter agreement (the “Agreement”) embodies the understanding between William Derwin (“Executive”) and The ServiceMaster Company (the
“Company”) regarding any future separation or severance payments by the Company to which Executive may become entitled in connection with a future
termination of employment with the Company and its affiliates.
1. Severance Benefits.
(a) In the event that (i) Executive’s employment with the Company and its affiliates is terminated at any time by the Company without Cause
or by Executive for Good Reason, then the Company shall, subject to the below terms, restrictions and conditions, pay the following to Executive as severance
pay (the “Severance Pay”):
(i) An amount equal to twelve times Executive’s monthly base salary in effect as of the Termination Date (as defined below) (the “Monthly
Salary”); plus
(ii) An amount equal to Executive’s then current year’s annual bonus at target (the “Target Bonus”), pursuant to the terms of the then Annual
Bonus Plan (the “ABP”); plus
(iii) An amount equivalent to the pro-rata percentage of Executive’s then current annual bonus target pursuant to the ABP based on actual Plan
Year performance, if the Termination Date is after June 30 , payable when annual bonuses are generally payable pursuant to the ABP (currently in
March of the following year); plus
(iv) An amount equal to twelve times the Executive’s monthly cost for health care continuation coverage for those eligible plans (such as
medical and prescription drug, dental and vision coverage) in place immediately before the termination, to be paid on the sixtieth (60 ) day after
termination.
The Monthly Salary and the Target Bonus shall be aggregated as a single sum (the “Period Payment”), and such sum shall be paid in 12 equal monthly
installments over a 12 month period starting on the first practicable payroll date after the severance agreement referred to in Section 2 has become irrevocable
(the date of Executive’s termination of employment, the “Termination Date”, and such 12 month period, the “Severance Payment Period”); provided, that if the
22-day period plus the applicable statutory revocation period begins in one calendar year and ends in a subsequent calendar year, the Severance Payment
Period shall begin in the subsequent calendar year. All payments hereunder are subject to normal Federal, state and/or local income tax or other lawful
withholding. Executive may not elect to defer or accelerate any payment hereunder.
th
th