American Home Shield 2007 Annual Report Download - page 106

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withholdings and other deductions, the amount earned in accordance with the terms of the 2007 ABP; it being understood that your
2007 target bonus under the ABP and 2007 target bonus, if any, under the CPP shall be at least equal to your 2006 target bonus
under the ABP or CPP, as applicable); provided, however, that 100% of the amount earned shall be based upon corporate
performance goals and not any individual performance goals. The amount payable, if any, in respect of 2007 pursuant to this
section shall equal the amount earned, if any, under the 2007 ABP or 2007 CPP, or both, multiplied by a fraction, the numerator of
which is the number of days from and including January 1, 2007 through and including the Separation Date, and the denominator of
which is 365. Any payment would be made to you in a time period consistent with payments made to active participants in the 2007
ABP and 2007 CPP. The amount of the 2007 ABP bonus, if any, will be increased (but may not be decreased) for any increase in
annual base salary or target bonus percentage, or both. Subject to the determination of the Compensation and Leadership
Development Committee to continue the CPP in 2007, the number of 2007 CPP units will not be less than the number of 2006 CPP
units.
10. Stock Options and Stock Appreciation Rights. Except as set forth in this section, each option to purchase
ServiceMaster common stock and stock appreciation right ("SAR") relating to ServiceMaster common stock held by you will
continue in accordance with its terms. For purposes of each such option and SAR, the date of your termination of employment shall
be the close of business on the Separation Date; it being understood that each such option and SAR shall be exercisable after the
Separation Date only to the extent exercisable on the Separation Date and will expire six months after the Separation Date (unless
otherwise specifically provided for in the stock option agreement or SAR agreement); provided, however, that any
WeServeHomes.com, LandCare or ARS stock options, if any, that have been granted to you will expire three months after the
Separation Date. Notwithstanding the foregoing, if your employment is terminated for any reason prior to the Separation Date, the
vesting of options and SARs held by you on the effective date of your termination of employment shall be governed by the terms of
the applicable stock option agreement and SAR agreement. Each stock option and SAR may vary with regard to option schedule,
exercise price, base price, and post-employment obligations regarding competition against ServiceMaster, confidentiality and
solicitation of employees. You should refer to each stock option agreement and SAR agreement for these details.
11. Restricted Stock. All shares of restricted stock held by you that are not vested on the Separation Date shall
terminate at the close of business on the Separation Date. Notwithstanding the foregoing, if your employment is terminated for any
reason prior to the Separation Date, the vesting of all shares of restricted stock held by you on the effective date of your termination
of employment shall be governed by the terms of the applicable restricted stock award agreement.
4
12. Vacation.On the Separation Dateyou will be paid for any unused, earned vacation days.
13. Unemployment Compensation. ServiceMaster will not contest your eligibility for unemployment compensation
following the effective date of your termination of employment.
14. Termination of Employment Prior to the Separation Date. If your employment is terminated by ServiceMaster
without Cause prior to the earlier to occur of (i) your Separation Date and (ii) a Change in Control, ServiceMaster agrees,
conditioned upon you signing a second release agreement in substantially the same form as Exhibit A, (1) to pay you, within fifteen
(15) days after the effective date of your termination of employment, by lump sum payment and in lieu of any payments under
Sections 2 and 3, a gross amount equal to the sum of the amounts determined under Sections 2(a), 2(b), and 3, less applicable
payroll withholdings and other deductions; (2) to pay you, by lump sum payment made by March 15, 2007 (to the extent unpaid and
in lieu of any payment for 2006 ABP and 2006 CPP under Section 9), 100% of the amount earned, if any, under the 2006 ABP or
2006 CPP, or both, less applicable withholdings and other deductions; (3) to pay you, by lump sum payment made by March 15,
2008 (in lieu of any payment for 2007 ABP and 2007 CPP under Section 9) the amount earned, if any, under the 2007 ABP or 2007
CPP, or both, multiplied by a fraction, the numerator of which is the number of days from and including January 1, 2007 through
and including the Separation Date, and the denominator of which is 365; (4) to provide the outplacement services pursuant to
Section 4; (5) to make the ServiceMaster matching contribution pursuant to Sections 6 and 7; (6) to pay you for any unused, earned
vacation days as of the effective date of your termination of employment; and (7) not to contest your eligibility for unemployment
compensation following the effective date of your termination of employment. If your employment is terminated prior to the
Separation Date for any reason other than by ServiceMaster without Cause, you will forfeit all rights to (1) any payment under
Sections 2, 3 and 9; (2) outplacement services under Section 4; and (3) any ServiceMaster matching contribution to be made
pursuant to Sections 6 and 7 after the effective date of your termination of employment. As used in this Agreement, Cause is
defined in Exhibit C. You agree that the termination of your employment for any reason will not affect your obligations and
agreements under Sections 1, 16, 17 and Sections 19 through 30. Payments by ServiceMaster pursuant to this Section 14 shall be in
lieu of any payments pursuant to the Change in Control Agreement, as defined in Section 2(d).
15. Certain Additional Payments.
(a) Anything in this Agreement to the contrary notwithstanding, in the event it shall be determined that any
payment or distribution (including of stock, options, stock appreciation rights, phantom stock, stock units, or other rights to acquire
stock, the vesting of which is accelerated as a result of a Change in Control, as defined in Section 2(d)) by ServiceMaster or its
affiliated companies to or for the benefit of you (whether paid or payable or distributed or distributable pursuant to the terms of this