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39
Amortization Expense
Amortization expense was $38 million, $52 million and $51 million in the years ended December 31, 2015, 2014 and 2013,
respectively. The decrease in 2015 was a result of certain finite-lived intangible assets recorded in connection with the merger in 2007
being fully amortized.
401(k) Plan Corrective Contribution
We recorded a charge of $23 million in the year ended December 31, 2015 related to the 401(k) Plan. See Note 11 to the
consolidated financial statements for more details.
Impairment of Software and Other Related Costs
We recorded an impairment charge of $47 million in the year ended December 31, 2014 relating to our decision in the first
quarter of 2014 to abandon our efforts to deploy a new operating system at American Home Shield.
Consulting Agreement Termination Fees
On July 1, 2014, in connection with the completion of our initial public offering, we paid the Equity Sponsors aggregate fees
of $21 million in connection with the termination of the consulting agreements, which was recorded in the year ended December 31,
2014. See Note 10 to the consolidated financial statements for more details.
Restructuring Charges
We incurred restructuring charges of $5 million, $11 million and $6 million for the years ended December 31, 2015, 2014
and 2013, respectively. Restructuring charges were comprised of the following:
Year Ended December 31,
(In millions) 2015 2014 2013
Terminix branch optimization(1) $ 3 $ 2 $ 2
Franchise Services Group reorganization(2) 1 3 —
Corporate(3) 1 6 4
Total restructuring charges $ 5 $ 11 $ 6
___________________________________
(1) These charges included severance costs of $2 million, $2 million and $1 million for the years ended December 31, 2015,
2014 and 2013, respectively, and lease termination costs of $1 million for the years ended December 31, 2015 and 2013.
(2) Represents severance costs.
(3) Represents restructuring charges related to an initiative to enhance capabilities and reduce costs in our headquarters functions
that provide company-wide administrative services for our operations. For the years ended December 31, 2015, 2014 and
2013, these charges included severance and other costs of $1 million, $5 million and $1 million, respectively. For the years
ended December 31, 2014 and 2013, these charges also included professional fees of $1 million and $3 million, respectively.
Gain on Sale of Merry Maids Branches
We recorded a gain of $7 million and $1 million for the years ended December 31, 2015 and 2014, respectively, associated
with the branch conversions.
Interest Expense
Interest expense was $167 million, $219 million and $247 million for the years ended December 31, 2015, 2014 and 2013,
respectively. The decrease in interest expense in the year ended December 31, 2015 compared to the year ended December 31, 2014
was driven by the refinancing of the Old Term Facilities on July 1, 2014 and the redemption of the 2020 Notes, offset, in part, by
additional borrowings under the April and August Incremental Term Loans. The decrease in interest expense in the year ended
December 31, 2014 compared to the year ended December 31, 2013 was driven by the refinancing of the Old Term Facilities and the
partial redemption of the 2020 Notes. See Note 12 to the consolidated financial statements for more details.
Interest and Net Investment Income
Interest and net investment income was $9 million, $7 million and $8 million for the years ended December 31, 2015, 2014
and 2013, respectively, and comprised the following:
Year Ended December 31,
(In millions) 2015 2014 2013
Realized gains(1) $ 8 $ 6 $ 5
Deferred compensation trust(2) — — 2
Other(3) 1 1 1
Total interest and net investment income $ 9 $ 7 $ 8
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2015 Annual Report 55