American Home Shield 2009 Annual Report Download - page 112

Table of Contents
Notes to the Consolidated Financial Statements (Continued)
Note 11. Related Party Transactions (Continued)
2009 and 2008 amounted to $3.2 million and $2.8 million, respectively ($2.4 million of the accrued interest payable to Holdings at December 31, 2008 was
acquired by Holdings in their open market purchases).
Note 12. Employee Benefit Plans
Effective January 2, 2007, the Company approved a new long-term incentive plan (the "LTIP") designed to reward certain employees based on the
accumulated three-year Company financial performance against pre-tax income and revenue goals. Pursuant to the LTIP, the awards would be paid out in
cash at the end of a three-year performance period, if certain performance measures were achieved. The costs of the awards are recognized over the
performance period and are included in selling and administrative expense in the Consolidated Statements of Operations. Compensation expense related to the
LTIP was $1.7 million for the year ended December 31, 2008, $1.5 million for the Successor period from July 25, 2007 to December 31, 2007 and
$1.9 million for the Predecessor period from January 1, 2007 to July 24, 2007. During 2009, the Company determined that the three year financial
performance measures had not been achieved and reversed reserves related to the Plan in the amount of $4.4 million.
Discretionary contributions to qualified profit sharing and non-qualified deferred compensation plans were made in the amount of $13.1 million and
$14.0 million for the years ended December 31, 2009 and 2008, $3.5 million for the Successor period from July 25, 2007 to December 31, 2007 and
$5.8 million for the Predecessor period from January 1, 2007 to July 24, 2007. Under the Employee Share Purchase Plan, the Company contributed
$0.2 million for the Predecessor period from January 1, 2007 to July 24, 2007. These funds defrayed part of the cost of the shares purchased by employees.
The Employee Share Purchase Plan was terminated in conjunction with the Merger.
Note 13. Noncontrolling Interests
On June 4, 2007, the noncontrolling interest in Terminix was converted into eight million shares of ServiceMaster common stock and the noncontrolling
interest balance in the Consolidated Statements of Financial Position was reduced to zero. As a result of the Merger, the eight million shares of ServiceMaster
common stock that were issued were converted into the right to receive $15.625 in cash per the Merger Consideration.
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