American Home Shield 2008 Annual Report Download - page 153

Table of Contents
Participation Agreements
As a condition to participation in the MSIP, each MSIP participant who had entered into a change in control severance agreement (among the Named
Executive Officers, Messrs. Spainhour, Martin, Brackett, Isakson and Sutton) was required to enter into a Participation Agreement pursuant to which he
consented to amendments to the definition of "good reason" under his change in control severance agreement, with the practical effect that any of the
following may occur without triggering the participant's ability to terminate his employment for "good reason" and be entitled to benefits under his change in
control severance agreement:
the Company can choose not to re-elect such officer to any particular position, so long as the Company does not reduce his positions, duties and
responsibilities in any material respect;
such participant will not be entitled to guaranteed raises based on prior average raises to executive officers' base salaries;
the Company can provide such participant with employee benefits and compensation plans that are comparable on an overall, rather than plan-
by-plan, basis; and
when the Company is required to provide such participant comparable benefits, the basis for comparison will be the benefits such participant
received prior to the closing of the Merger, not benefits provided after closing or to other employees.
In the Participation Agreements, the participants also made the following acknowledgments to the Company that affected their rights under the change in
control severance agreements:
the consummation of the Merger and any change between the participant's position and terms of employment as in effect before the Merger,
compared with immediately thereafter, did not permit the participant to terminate his employment for "good reason" under his change in control
severance agreement;
any change that occurred to the participant's position and terms of employment after the consummation of the Merger, or any planned change to
his position and terms of employment that had been communicated to him, but not yet implemented, in each case at the time the participant
entered into the Participation Agreement, did not permit the participant to terminate his employment for "good reason" under his change in
control severance agreement;
the officer's participation in the MSIP satisfied all of the Company's obligations to provide long-term incentive opportunities under his change in
control severance agreement; and
the annual bonus plan in which the officer participated on the date of his purchase of shares under the MSIP satisfied all of the Company's
obligations to provide annual incentive opportunities under his change in control severance agreement.
Severance Benefits Payable to Named Executive Officers under Change in Control Severance Agreements
If we terminate the employment of a Named Executive Officer who is subject to a change in control severance agreement for a reason other than cause,
or if such Named Executive Officer terminates his employment for good reason, in either case prior to July 24, 2009, we will pay to the Named Executive
Officer a lump sum cash payment consisting of:
accrued salary through the date of termination;
any unpaid previously earned Annual Bonus Plan bonuses;
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