American Home Shield 2015 Annual Report Download - page 91

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Table of Contents
73
Prior Years
On February 28, 2014, the Company acquired HSA. The total net purchase price for this acquisition was $32 million. The
Company recorded goodwill of $34 million and other intangibles of $18 million related to this acquisition.
During the year ended December 31, 2014, the Company completed several pest control, termite and franchise acquisitions.
The total net purchase price for these acquisitions was $32 million. The Company recorded goodwill of $20 million and other
intangibles, primarily customer relationships, of $11 million related to these acquisitions.
During the year ended December 31, 2013, the Company completed several pest control and termite acquisitions, along with
several franchise acquisitions and the purchase of a distributor license agreement within the Franchise Services Group. The total net
purchase price for these acquisitions was $40 million. The Company recorded goodwill of $24 million and other intangibles, primarily
customer relationships, of $13 million related to these acquisitions.
Supplemental cash flow information regarding the Company’s acquisitions is as follows:
Year Ended December 31,
(In millions) 2015 2014 2013
Assets acquired $ 126 $ 99 $ 40
Liabilities assumed — (34) —
N
et assets acquire
d
$ 125 $ 64 $ 40
N
et cash pai
d
$ 92 $ 58 $ 32
Seller financed debt 33 6 8
Purchase price $ 125 $ 64 $ 40
Note 7. Discontinued Operations
TruGreen Spin-off
On January 14, 2014, the Company completed the TruGreen Spin-off resulting in the spin-off of the assets and certain
liabilities of the TruGreen Business through a tax-free, pro rata dividend to the Company’s stockholders. As a result of the completion
of the TruGreen Spin-off, New TruGreen operates the TruGreen Business as a private independent company. The following is a
summary of the assets and liabilities distributed to New TruGreen as part of the TruGreen spin-off on January 14, 2014:
(In millions)
Assets:
Cash and cash equivalents $ 57
Receivables, net 22
Inventories and other current assets 39
Property and equipment, net 181
Intangible assets, net 216
Other long-term assets 6
Total Assets $ 521
Liabilities:
Current liabilities $ 149
Long-term debt and other long-term liabilities 97
Total Liabilities $ 246
N
et assets distributed to New TruGreen $275
The historical results of the TruGreen Business, including the results of operations, cash flows and related assets and
liabilities, are reported as discontinued operations for all periods presented herein.
In connection with the TruGreen Spin-off, the Company entered into a transition services agreement with New TruGreen
pursuant to which the Company provides New TruGreen with specified communications, public relations, finance and accounting, tax,
treasury, internal audit, human resources operations and benefits, risk management and insurance, supply management, real estate
management, marketing, facilities, information technology and other support services. The charges for the transition services are
designed to allow the Company to fully recover the direct costs of providing the services, plus specified margins and any out-of-
pocket costs and expenses. The services provided under the transition services agreement terminated at various specified times on or
prior to January 14, 2016 (except certain information technology, human resources and accounts payable services, which the Company
expects to provide to New TruGreen beyond January 14, 2016). New TruGreen may terminate the transition services agreement (or
certain services under the transition services agreement) for convenience upon 90 days written notice, in which case New TruGreen
will be required to reimburse the Company for early termination costs.
2015 Annual Report 89