American Home Shield 2007 Annual Report Download - page 118

Agreement or otherwise, but determined without regard to any additional payments required under this Section 15) (a "Payment")
would be subject to the excise tax imposed by Section 4999 of the Internal Revenue Code of 1986, as amended (the "Code"), or any
interest or penalties are incurred by you with respect to such excise tax (such
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excise tax, together with any such interest and penalties, are hereinafter collectively referred to as the "Excise Tax"), then you shall
be entitled to receive an additional payment (a "Gross-Up Payment") in an amount such that after payment by you of all taxes
(including any interest or penalties imposed with respect to such taxes), including, without limitation, any income taxes (and any
interest and penalties imposed with respect thereto) and Excise Tax imposed upon the Gross-Up Payment, you retain an amount of
the Gross-Up Payment equal to the Excise Tax imposed upon the Payments.
(b) Subject to the provisions of Section 15(c), all determinations required to be made under this Section 15,
including whether and when a Gross-Up Payment is required and the amount of such Gross-Up Payment and the assumptions to be
utilized in arriving at such determination, shall be made by a nationally recognized public accounting or law firm (the "Firm")
which shall provide detailed supporting calculations both to ServiceMaster and you within fifteen (15) business days of the receipt
of notice from you that there has been a Payment, or such earlier time as is requested by ServiceMaster. In the event that the Firm is
serving as accountant, auditor or attorney for the individual, entity or group effecting the Change in Control, you shall appoint
another nationally recognized public accounting or law firm to make the determinations required hereunder (which accounting firm
shall then be referred to as the Firm hereunder). All fees and expenses of the Firm shall be borne solely by ServiceMaster. Any
Gross-Up Payment, as determined pursuant to this Section 15, shall be paid by ServiceMaster to you within five days of the receipt
of the Firm's determination. If the Firm determines that no Excise Tax is payable by you, it shall furnish you with a written opinion
that failure to report the Excise Tax on your applicable federal income tax return would not result in the imposition of a negligence
or similar penalty. Any determination by the Firm shall be binding upon ServiceMaster and you. As a result of uncertainty in the
application of Section 4999 of the Code at the time of the initial determination by the Firm hereunder, it is possible that Gross-Up
Payments which will not have been made by ServiceMaster should have been made ("Underpayment"), consistent with the
calculations required to be made hereunder. In the event that ServiceMaster exhausts its remedies pursuant to Section 15(c) and you
thereafter are required to make a payment of any Excise Tax, the Firm shall determine the amount of the Underpayment that has
occurred and any such Underpayment shall be promptly paid by ServiceMaster to or for the benefit of you.
(c) You shall notify ServiceMaster in writing of any claim by the Internal Revenue Service that, if successful,
would require the payment by ServiceMaster of a Gross-Up Payment. Such notification shall be given as soon as practicable but no
later than ten (10) business days after you are informed in writing of such claim and shall apprise ServiceMaster of the nature of
such claim and the date on which such claim is requested to be paid (it being understood that any failure by you to provide such
notification shall not affect your rights hereunder unless and only to the extent that ServiceMaster is actually prejudiced by such
failure). You shall not pay such claim prior to the expiration of the 30-day period following the date on which you give such notice
to ServiceMaster (or such shorter period ending on the date that any payment of taxes with respect to such claim is due). If
ServiceMaster notifies you in writing prior to the expiration of such period that it desires to contest such claim, you shall:
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(1) give ServiceMaster any information reasonably requested by ServiceMaster relating to such claim,
(2) take such action in connection with contesting such claim as ServiceMaster shall reasonably request
in writing from time to time, including, without limitation, accepting legal representation with respect to such claim by
an attorney reasonably selected by ServiceMaster,
(3) cooperate with ServiceMaster in good faith in order effectively to contest such claim, and
(4) permit ServiceMaster to participate in any proceedings relating to such claim;
provided, however, that ServiceMaster shall bear and pay directly all costs and expenses (including additional
interest and penalties) incurred in connection with such contest and shall indemnify and hold you harmless, on an after-tax basis, for
any Excise Tax or income tax (including interest and penalties with respect thereto) imposed as a result of such representation and
payment of costs and expenses. Without limitation on the foregoing provisions of this Section 15(c), ServiceMaster shall control all
proceedings taken in connection with such contest and, at its sole option, may pursue or forgo any and all administrative appeals,
proceedings, hearings and conferences with the taxing authority in respect of such claim and may, at its sole option, either direct
you to pay the tax claimed and sue for a refund or contest the claim in any permissible manner, and you agree to prosecute such
contest to a determination before any administrative tribunal, in a court of initial jurisdiction and in one or more appellate courts, as
ServiceMaster shall determine; provided further, that if ServiceMaster directs you to pay such claim and sue for a refund,