Exhibit 10.2

 

EXECUTION VERSION

 

This INDEMNIFICATION AGREEMENT, dated as of March 21, 2014 (the “Agreement”), is
among ServiceMaster Global Holdings, Inc., a Delaware corporation (the
“Company”), The ServiceMaster Company, LLC a Delaware limited liability company
(“SVM LLC” and together with the Company, the “Company Entities”) and Ridgemont
Partners Management, LLC, a Delaware limited liability company (the
“Consultant”).  Capitalized terms used herein without definition have the
meanings set forth in Section 1 of this Agreement.

 

RECITALS

 

WHEREAS, The ServiceMaster Company (“ServiceMaster”), the Company, Banc of
America Capital Investors V, L.P., BAS Capital Funding Corporation, BACSVM,
L.P., Banc of America Strategic Investments Corporation, Banc of America Capital
Management V, L.P., BACM I GP, LLC and BA Equity Co-Invest GP LLC (together with
Banc of America Capital Investors V, L.P., BAS Capital Funding Corporation,
BACSVM, L.P., Banc of America Strategic Investments Corporation, Banc of America
Capital Management V, L.P. and BACM I GP, LLC, the “BAS Investors”) have
previously entered into an Amended and Restated Indemnification Agreement, dated
as of March 19, 2014 (the “BAS Indemnification Agreement”);

 

WHEREAS, on March 30, 2012, certain shares of the Company held by the BAS
Investors were transferred to Ridgemont (the “Transfer”);

 

WHEREAS, pursuant to a Separation and Distribution Agreement, dated as of
January 14, 2014, by and among ServiceMaster, the Company, TruGreen Holding
Corporation, a Delaware corporation (“TruGreen”) and TruGreen Limited
Partnership, all of the outstanding shares of capital stock of TruGreen were
distributed to the stockholders of the Company on a pro rata basis (the
“Spin-Off);

 

WHEREAS, in connection with the Spin-Off, ServiceMaster was merged with and into
SVM LLC, with SVM LLC as the surviving entity;

 

WHEREAS, concurrently with the execution and delivery of this Agreement and in
connection with the Transfer, the Company, SVM LLC and the BAS Investors intend
to terminate the BAS Indemnification Agreement and to replace it with this
Agreement; and

 

WHEREAS, concurrently with the execution and delivery of this Agreement, the
Company and certain other parties have entered into a Consulting Agreement with
the Consultant (or one of its Affiliates), dated as of the date hereof (as the
same may be amended from time to time, the “Consulting Agreement”).

 

WHEREAS, the Company or one or more of its Subsidiaries from time to time in the
future may (i) offer and sell or cause to be offered and sold equity or debt
securities

 

--------------------------------------------------------------------------------

 

(such offerings, collectively, the “Subsequent Offerings”), including without
limitation (a) offerings of shares of capital stock or equity-linked instruments
of the Company or any of its Subsidiaries, and/or options to purchase such
shares to employees, directors, managers, dealers, franchisees and consultants
of and to the Company or any of its Subsidiaries (any such offering, a
“Management Offering”), and (b) one or more offerings of debt securities for the
purpose of refinancing any indebtedness of the Company or any of its
Subsidiaries or for other corporate purposes, and (ii) repurchase, redeem or
otherwise acquire certain securities of the Company or any of its Subsidiaries
or engage in recapitalization or structural reorganization transactions relating
thereto (any such repurchase, redemption, acquisition, recapitalization or
reorganization, a “Redemption”), in each case subject to the terms and
conditions of the Amended and Restated Stockholders Agreement, by and among the
Company and the stockholders party thereto, dated as of January 14, 2014, (the
“Stockholders Agreement”) and any other applicable agreement.

 

WHEREAS, the parties hereto recognize the possibility that claims might be made
against and liabilities incurred by the Consultant or related Persons or
Affiliates under applicable securities laws or otherwise in connection with the
Securities Offerings, or relating to other actions or omissions of or by members
of the Company Group, and the parties hereto accordingly wish to provide for the
Consultant and related Persons and Affiliates to be indemnified in respect of
any such claims and liabilities.

 

NOW, THEREFORE, in consideration of the foregoing premises, and the mutual
agreements and covenants and provisions herein set forth, the parties hereto
hereby agree as follows:

 

1.                                      Definitions.

 

(a)                                “Affiliate” means, with respect to any
Person, (i) any other Person directly or indirectly Controlling, Controlled by
or under common Control with, such Person, (ii) any Person directly or
indirectly owning or Controlling 10% or more of any class of outstanding voting
securities of such Person or (iii) any officer, director, general partner,
special limited partner or trustee of any such Person described in clause (i) or
(ii).  “Control” of any Person shall consist of the power to direct the
management and policies of such Person (whether through the ownership of voting
securities, by contract, as trustee or executor, or otherwise).

 

(b)                                “Change in Control” means the first to occur
of the following events after the date hereof:

 

(i)  the acquisition by any Person or “group” (as defined in Section 13(d) of
the Securities Exchange Act of 1934, as amended) of 50% or more of the combined
voting power of the Company’s

 

2

--------------------------------------------------------------------------------

 

then outstanding voting securities, other than any such acquisition by any
member of the Company Group, any Principal Stockholder or Initial Stockholder
(as defined in the Stockholders Agreement), any employee benefit plan of the
Company or any of its Subsidiaries, or any Affiliates of any of the foregoing;

 

(ii)  the merger, consolidation or other similar transaction involving the
Company, as a result of which Persons who were stockholders of the Company
immediately prior to such merger, consolidation, or other similar transaction do
not, immediately thereafter, own, directly or indirectly, more than 50% of the
combined voting power entitled to vote generally in the election of directors of
the merged or consolidated company;

 

(iii)  within any 24-month period, the persons who were directors of the Company
at the beginning of such period (the “Incumbent Directors”) shall cease to
constitute at least a majority of the votes of the total authorized membership
of the board of directors of the Company, provided that any director elected or
nominated for election to the board of directors of the Company by a majority
vote of the Incumbent Directors then still in office shall be deemed to be an
Incumbent Director for purposes of this clause (iii); or

 

(iv)  the sale, transfer or other disposition of all or substantially all of the
assets of the Company to one or more Persons that are not, immediately prior to
such sale, transfer or other disposition, Affiliates of the Company.

 

Notwithstanding the foregoing, a Public Offering shall not constitute a Change
in Control.

 

(c)                                 “Claim” means, with respect to any
Indemnitee, any claim by or against such Indemnitee involving any Obligation
with respect to which such Indemnitee may be entitled to be indemnified by any
member of the Company Group under this Agreement.

 

(d)                                “Commission” means the United States
Securities and Exchange Commission or any successor entity thereto.

 

(e)                                 “Company Group” means the Company and any of
its Subsidiaries.

 

(f)                                  “Determination” means a determination that
either (i) there is a reasonable basis for the conclusion that indemnification
of an Indemnitee is proper in the circumstances because such Indemnitee met a
particular standard of conduct (a

 

3

--------------------------------------------------------------------------------

 

“Favorable Determination”) or (ii) solely in the case of an Indemnitee making a
Claim in such Indemnitee’s capacity as director or officer of the Company Group,
there is no reasonable basis for the conclusion that indemnification of an
Indemnitee is proper in the circumstances because such Indemnitee met a
particular standard of conduct (an “Adverse Determination”).  Except as required
by law, no Adverse Determination shall be made in the case of any Indemnitee
that is not a director or officer of the Company or in connection with any
Indemnitee Claim not made in its capacity as a director or officer of the
Company Group.  An Adverse Determination shall include the decision that a
Determination was required in connection with indemnification and the decision
as to the applicable standard of conduct.

 

(g)                                 “Exchange Act” means the Securities Exchange
Act of 1934, as amended, and the rules and regulations promulgated thereunder.

 

(h)                                “Expenses” means all attorneys’ fees and
expenses, retainers, court, arbitration and mediation costs, transcript costs,
fees of experts, bonds, witness fees, costs of collecting and producing
documents, travel expenses, duplicating costs, printing and binding costs,
telephone charges, postage, delivery service fees and all other disbursements or
expenses of the types customarily incurred in connection with prosecuting,
defending, preparing to prosecute or defend, investigating, being or preparing
to be a witness in, appealing or otherwise participating in a Proceeding.

 

(i)                                    “Indemnitee” means each of the
Consultant, its Affiliates, its successors and assigns, and the directors,
officers, partners, members, employees, agents, advisors, consultants,
representatives and controlling persons (within the meaning of the Securities
Act) of the Consultant, or of its partners, members and controlling persons, and
each other person who is or becomes a director or an officer of any member of
the Company Group, in each case irrespective of the capacity in which such
person acts.

 

(j)                                   “Independent Legal Counsel” means an
attorney or firm of attorneys competent to render an opinion under the
applicable law, selected in accordance with the provisions of Section 4(e), who
has not otherwise performed any services for any member of the Company Group or
for any Indemnitee within the last three years (other than with respect to
matters concerning the rights of an Indemnitee under this Agreement or other
indemnitees under indemnity agreements similar to this Agreement).

 

(k)                                “Obligations” means, collectively, any and
all claims, obligations, liabilities, causes of actions, Proceedings,
investigations, judgments, decrees, losses, damages (including punitive and
exemplary damages), fees, fines, penalties, amounts paid in settlement, costs
and Expenses (including without limitation interest, assessments and other
charges in connection therewith and disbursements of attorneys, accountants,
investment bankers and other professional advisors), in each case whether
incurred,

 

4

--------------------------------------------------------------------------------

 

arising or existing with respect to third parties or otherwise at any time or
from time to time.

 

(l)                                    “Person” means an individual,
corporation, limited liability company, limited or general partnership, trust or
other entity, including a governmental or political subdivision or an agency or
instrumentality thereof.

 

(m)                            “Proceeding” means a threatened, pending or
completed action, suit or proceeding, whether civil, criminal, administrative or
investigative, including without limitation a claim, demand, discovery request,
formal or informal investigation, inquiry, administrative hearing, arbitration
or other form of alternative dispute resolution, including an appeal from any of
the foregoing.

 

(n)                                “Public Offering” means the first day as of
which (i) sales of Shares are made to the public in the United States pursuant
to an underwritten public offering led by one or more underwriters at least one
of which is an underwriter of nationally recognized standing or (ii) the board
of directors of the Company has determined that Shares otherwise have become
publicly-traded for this purpose.

 

(o)                                “Related Document” means any agreement,
certificate, instrument or other document to which any member of the Company
Group may be a party or by which it or any of its properties or assets may be
bound or affected from time to time relating in any way to any Securities
Offering or any of the transactions contemplated thereby, including without
limitation, in each case as the same may be amended from time to time, (i) any
registration statement filed by or on behalf of any member of the Company Group
with the Commission in connection with any Securities Offering, including all
exhibits, financial statements and schedules appended thereto, and any
submissions to the Commission in connection therewith, (ii) any prospectus,
preliminary, free-writing or otherwise, included in such registration statements
or otherwise filed by or on behalf of any member of the Company Group in
connection with any Securities Offering or used to offer or confirm sales of
their respective securities in any Securities Offering, (iii) any private
placement or offering memorandum or circular, information statement or other
information or materials distributed by or on behalf of any member of the
Company Group or any placement agent or underwriter in connection with any
Securities Offering, (iv) any federal, state or foreign securities law or other
governmental or regulatory filings or applications made in connection with any
Securities Offering or any of the transactions contemplated thereby, (v) any
dealer-manager, underwriting, subscription, purchase, stockholders, option or
registration rights agreement or plan entered into or adopted by any member of
the Company Group in connection with any Securities Offering, (vi) any purchase,
repurchase, redemption, recapitalization or reorganization or other agreement
entered into by any member of the Company Group in connection with any
Redemption, or (vii) any quarterly, annual or current reports or other filing
filed, furnished or supplementally provided by any member of the Company Group
with or to the

 

5

--------------------------------------------------------------------------------

 

Commission or any securities exchange, including all exhibits, financial
statements and schedules appended thereto, and any submission to the Commission
or any securities exchange in connection therewith.

 

(p)                                “Securities Act” means the Securities Act of
1933, as amended, and the rules and regulations promulgated thereunder.

 

(q)                                “Securities Offerings” means any Management
Offering, any Redemption and any Subsequent Offering.

 

(r)                                   “Shares” means the common stock of the
Company, par value US$0.01 per share.

 

(s)                                  “Subsidiary” means each corporation or
other Person in which a Person owns or Controls, directly or indirectly, capital
stock or other equity interests representing more than 50% of the outstanding
voting stock or other equity interests.

 

2.                                      Indemnification.

 

(a)                                Each of the Company Entities (each an
“Indemnifying Party” and collectively the “Indemnifying Parties”), jointly and
severally, agrees to indemnify, defend and hold harmless each Indemnitee:

 

(i)                                     from and against any and all
Obligations, whether incurred with respect to third parties or otherwise, in any
way resulting from, arising out of or in connection with, based upon or relating
to (A) the Securities Act, the Exchange Act or any other applicable securities
or other laws, in connection with any Securities Offering, any Related Document
or any of the transactions contemplated thereby, (B) any other action or failure
to act of any member of the Company Group or any of their predecessors, whether
such action or failure has occurred or is yet to occur or (C) the performance by
the Consultant (or its Affiliates) of the Consulting Services pursuant to, and
as defined in, the Consulting Agreement; and

 

(ii)                                  to the fullest extent permitted by the law
specified herein as governing this Agreement, by the law of the place of
incorporation of an Indemnifying Party, or by any other applicable law in effect
as of the date hereof or as amended to increase the scope of permitted
indemnification, whichever is greater (except, with respect to any Indemnifying
Party, to the extent that such indemnification may be prohibited by the law of
the place of incorporation of such Indemnifying Party), from and against any and
all Obligations whether incurred with respect to third parties or otherwise, in
any way resulting from, arising out of or in connection with, based upon or
relating to (A) the fact that such Indemnitee is or was a director or an officer
of any member of the Company

 

6

--------------------------------------------------------------------------------

 

Group or is or was serving at the request of such corporation as a director,
officer, member, employee or agent of or advisor or consultant to another
corporation, partnership, joint venture, trust or other enterprise, (B) any
breach or alleged breach by such Indemnitee of his or her fiduciary duty as a
director or an officer of any member of the Company Group or (C) any payment or
reimbursement by the Consultant, or any of its Affiliates, pursuant to
indemnification arrangements or otherwise in connection with any of the
foregoing in this Section 2(a)(ii);

 

in each case including but not limited to any and all fees, costs and Expenses
(including without limitation fees and disbursements of attorneys and other
professional advisers) incurred by or on behalf of any Indemnitee in asserting,
exercising or enforcing any of its rights, powers, privileges or remedies in
respect of this Agreement or the Consulting Agreement.

 

(b)                                Without in any way limiting the foregoing
Section 2(a), each of the Indemnifying Parties agrees, jointly and severally, to
indemnify, defend and hold harmless each Indemnitee from and against any and all
Obligations resulting from, arising out of or in connection with, based upon or
relating to liabilities under the Securities Act, the Exchange Act or any other
applicable securities or other laws, rules or regulations in connection with (i)
the inaccuracy or breach of or default under any representation, warranty,
covenant or agreement in any Related Document, (ii) any untrue statement or
alleged untrue statement of a material fact contained in any Related Document or
(iii) any omission or alleged omission to state in any Related Document a
material fact required to be stated therein or necessary to make the statements
therein not misleading.  Notwithstanding the foregoing, the Indemnifying Parties
shall not be obligated to indemnify such Indemnitee from and against any such
Obligation to the extent that such Obligation arises out of or is based upon an
untrue statement or omission made in such Related Document in reliance upon and
in conformity with written information furnished to the Indemnifying Parties, as
the case may be, in an instrument duly executed by such Indemnitee and
specifically stating that it is for use in the preparation of such Related
Document.

 

(c)                                 Without limiting the foregoing, in the event
that any Proceeding is initiated by an Indemnitee or any member of the Company
Group to enforce or interpret this Agreement or any rights of such Indemnitee to
indemnification or advancement of expenses (or related Obligations of such
Indemnitee) under any member of the Company Group’s certificate of incorporation
or bylaws, any other agreement to which Indemnitee and any member of the Company
Group are party, any vote of directors of any member of the Company Group, the
Delaware General Corporate Law, any other applicable law or any liability
insurance policy, the Indemnifying Parties shall indemnify such Indemnitee
against all costs and Expenses incurred by such Indemnitee or on such
Indemnitee’s behalf in connection with such Proceeding, whether or not such
Indemnitee is successful in such Proceeding, except to the extent that the court
presiding over such

 

7

--------------------------------------------------------------------------------

 

Proceeding determines that material assertions made by such Indemnitee in such
Proceeding were in bad faith or were frivolous.

 

3.                                      Contribution.

 

(a)                                If for any reason the indemnity provided for
in Section 2(a) is unavailable or is insufficient to hold harmless any
Indemnitee from any of the Obligations covered by such indemnity, then the
Indemnifying Parties, jointly and severally, shall contribute to the amount paid
or payable by such Indemnitee as a result of such Obligation in such proportion
as is appropriate to reflect (i) the relative fault of each member of the
Company Group, on the one hand, and such Indemnitee, on the other, in connection
with the state of facts giving rise to such Obligation, (ii) if such Obligation
results from, arises out of, is based upon or relates to any Securities
Offering, the relative benefits received by each member of the Company Group, on
the one hand, and such Indemnitee, on the other, from such Securities Offering
and (iii) if required by applicable law, any other relevant equitable
considerations.

 

(b)                                If for any reason the indemnity specifically
provided for in Section 2(b) is unavailable or is insufficient to hold harmless
any Indemnitee from any of the Obligations covered by such indemnity, then the
Indemnifying Parties, jointly and severally, shall contribute to the amount paid
or payable by such Indemnitee as a result of such Obligation in such proportion
as is appropriate to reflect (i) the relative fault of each of the members of
the Company Group, on the one hand, and such Indemnitee, on the other, in
connection with the information contained in or omitted from any Related
Document, which inclusion or omission resulted in the inaccuracy or breach of or
default under any representation, warranty, covenant or agreement therein, or
which information is or is alleged to be untrue, required to be stated therein
or necessary to make the statements therein not misleading, (ii) the relative
benefits received by the members of the Company Group, on the one hand, and such
Indemnitee, on the other, from such Securities Offering and (iii) if required by
applicable law, any other relevant equitable considerations.

 

(c)                                 For purposes of Section 3(a), the relative
fault of each member of the Company Group, on the one hand, and of an
Indemnitee, on the other, shall be determined by reference to, among other
things, their respective relative intent, knowledge, access to information and
opportunity to correct the state of facts giving rise to such Obligation.  For
purposes of Section 3(b), the relative fault of each of the members of the
Company Group, on the one hand, and of an Indemnitee, on the other, shall be
determined by reference to, among other things, (i) whether the included or
omitted information relates to information supplied by the members of the
Company Group, on the one hand, or by such Indemnitee, on the other, (ii) their
respective relative intent, knowledge, access to information and opportunity to
correct such inaccuracy, breach, default, untrue or alleged untrue statement, or
omission or alleged omission, and

 

8

--------------------------------------------------------------------------------

 

(iii) applicable law.  For purposes of Section 3(a) or 3(b), the relative
benefits received by each member of the Company Group, on the one hand, and an
Indemnitee, on the other, shall be determined by weighing the direct monetary
proceeds to the Company Group, on the one hand, and such Indemnitee, on the
other, from such Securities Offering.

 

(d)                                The parties hereto acknowledge and agree that
it would not be just and equitable if contributions pursuant to Section 3(a) or
3(b) were determined by pro rata allocation or by any other method of allocation
that does not take into account the equitable considerations referred to in such
respective Section.  No Indemnifying Party shall be liable under Section 3(a) or
3(b), as applicable, for contribution to the amount paid or payable by any
Indemnitee except to the extent and under such circumstances as such
Indemnifying Party would have been liable to indemnify, defend and hold harmless
such Indemnitee under the corresponding Section 2(a) or 2(b), as applicable, if
such indemnity were enforceable under applicable law.  No Indemnitee shall be
entitled to contribution from any Indemnifying Party with respect to any
Obligation covered by the indemnity specifically provided for in Section 2(b) in
the event that such Indemnitee is finally determined to be guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act) in
connection with such Obligation and the Indemnifying Parties are not guilty of
such fraudulent misrepresentation.

 

4.                                      Indemnification Procedures.

 

(a)                                Whenever any Indemnitee shall have actual
knowledge of the assertion of a Claim against it, such Indemnitee shall notify
the appropriate member of the Company Group in writing of the Claim (the “Notice
of Claim”) with reasonable promptness after such Indemnitee has such knowledge
relating to such Claim; provided the failure or delay of such Indemnitee to give
such Notice of Claim shall not relieve any Indemnifying Party of its
indemnification obligations under this Agreement except to the extent that such
omission results in a failure of actual notice to it and it is materially
injured as a result of the failure to give such Notice of Claim.  The Notice of
Claim shall specify all material facts known to such Indemnitee relating to such
Claim and the monetary amount or an estimate of the monetary amount of the
Obligation involved if such Indemnitee has knowledge of such amount or a
reasonable basis for making such an estimate.  The Indemnifying Parties shall,
at their expense, undertake the defense of such Claim with attorneys of their
own choosing reasonably satisfactory in all respects to such Indemnitee, subject
to the right of such Indemnitee to undertake such defense as hereinafter
provided.  An Indemnitee may participate in such defense with counsel of such
Indemnitee’s choosing at the expense of the Indemnifying Parties.  In the event
that the Indemnifying Parties do not undertake the defense of the Claim within a
reasonable time after such Indemnitee has given the Notice of Claim, or in the
event that such Indemnitee shall in good faith determine that the defense of any
claim by the Indemnifying Parties is inadequate or may conflict with the
interest of any Indemnitee (including without limitation, Claims brought by or
on behalf of any member of the Company Group), such

 

9

--------------------------------------------------------------------------------

 

Indemnitee may, at the expense of the Indemnifying Parties and after giving
notice to the Indemnifying Parties of such action, undertake the defense of the
Claim and compromise or settle the Claim, all for the account of and at the risk
of the Indemnifying Parties.  In the defense of any Claim against an Indemnitee,
no Indemnifying Party shall, except with the prior written consent of such
Indemnitee, consent to entry of any judgment or enter into any settlement that
includes any injunctive or other non-monetary relief or any payment of money by
such Indemnitee, or that does not include as an unconditional term thereof the
giving by the Person or Persons asserting such Claim to such Indemnitee of an
unconditional release from all liability on any of the matters that are the
subject of such Claim and an acknowledgement that Indemnitee denies all
wrongdoing in connection with such matters.  The Indemnifying Parties shall not
be obligated to indemnify Indemnitee against amounts paid in settlement of a
Claim if such settlement is effected by such Indemnitee without the prior
written consent of the Company (on behalf of all Indemnifying Parties), which
shall not be unreasonably withheld.  In each case, each Indemnitee seeking
indemnification hereunder will cooperate with the Indemnifying Parties, so long
as an Indemnifying Party is conducting the defense of the Claim, in the
preparation for and the prosecution of the defense of such Claim, including
making available evidence within the control of such Indemnitee, as the case may
be, and persons needed as witnesses who are employed by such Indemnitee, as the
case may be, in each case as reasonably needed for such defense and at cost,
which cost, to the extent reasonably incurred, shall be paid by the Indemnifying
Parties.

 

(b)                                An Indemnitee shall notify the Indemnifying
Parties in writing of the amount requested for advances (“Notice of Advances”). 
The Indemnifying Parties hereby agree to advance reasonable costs and Expenses
incurred by any Indemnitee in connection with any Claim (but not for any Claim
initiated or brought voluntarily by an Indemnitee other than a Proceeding
pursuant to Section 2(c)) in advance of the final disposition of such Claim
without regard to whether Indemnitee will ultimately be entitled to be
indemnified for such costs and expenses upon receipt of an undertaking by or on
behalf of such Indemnitee to repay amounts so advanced if it shall ultimately be
determined in a decision of a court of competent jurisdiction from which no
appeal can be taken that such Indemnitee is not entitled to be indemnified by
the Indemnifying Parties as authorized by this Agreement.  The Indemnifying
Parties shall make payment of such advances no later than 10 days after the
receipt of the Notice of Advances.

 

(c)                                 An Indemnitee shall notify the Indemnifying
Parties in writing of the amount of any Claim actually paid by such Indemnitee
(the “Notice of Payment”).  The amount of any Claim actually paid by such
Indemnitee shall bear simple interest at the rate equal to the JPMorgan Chase
Bank, N.A. prime rate as of the date of such payment plus 2% per annum, from the
date the Indemnifying Parties receive the Notice of Payment to the date on which
any Indemnifying Party shall repay the amount of such Claim plus interest
thereon to such Indemnitee.  The Indemnifying Parties shall make

 

10

--------------------------------------------------------------------------------

 

indemnification payments to such Indemnitee no later than 30 days after receipt
of the Notice of Payment.

 

(d)                                 Determination.  The members of the Company
Group intend that Indemnitee shall be indemnified to the fullest extent
permitted by law as provided in Section 2 and that no Determination shall be
required in connection with such indemnification.  In no event shall a
Determination be required in connection with advancement of Expenses pursuant to
Section 4(b) or in connection with indemnification for expenses incurred as a
witness or incurred in connection with any Claim or portion thereof with respect
to which an Indemnitee has been successful on the merits or otherwise.  Any
decision that a Determination is required by law in connection with any other
indemnification of an Indemnitee, and any such Determination, shall be made
within 30 days after receipt of a Notice of Claim, as follows:

 

(i)                                     if no Change in Control has occurred,
(x) by a majority vote of the directors of the Indemnifying Parties who are not
parties to such Claim, even though less than a quorum, or (y) by a committee of
such directors designated by majority vote of such directors, even though less
than a quorum, or (z) if there are no such directors, or if such directors so
direct, by Independent Legal Counsel in a written opinion to the Indemnifying
Party and such Indemnitee; and

 

(ii)                                  if a Change in Control has occurred, by
Independent Legal Counsel in a written opinion to the Indemnifying Parties (or
their successors) and such Indemnitee.

 

The Indemnifying Parties shall pay all expenses incurred by Indemnitee in
connection with a Determination.

 

(e)                                  Independent Legal Counsel.  If there has
not been a Change in Control, Independent Legal Counsel shall be selected by the
board of directors of the Company and approved by Indemnitee (which approval
shall not be unreasonably withheld or delayed).  If there has been a Change in
Control, Independent Legal Counsel shall be selected by Indemnitee and approved
by the Company (which approval shall not be unreasonably withheld or delayed). 
The Indemnifying Parties shall pay the fees and expenses of Independent Legal
Counsel and indemnify Independent Legal Counsel against any and all Expenses,
claims, liabilities and damages arising out of or relating to its engagement.

 

(f)                                   Consequences of Determination; Remedies of
Indemnitee.  The Indemnifying Parties shall be bound by and shall have no right
to challenge a Favorable Determination.  If an Adverse Determination is made, or
if for any other reason the Indemnifying Parties do not make timely
indemnification payments or advances of

 

11

--------------------------------------------------------------------------------

 

expenses, Indemnitee shall have the right to commence a Proceeding before a
court of competent jurisdiction to challenge such Adverse Determination and/or
to require the Indemnifying Parties to make such payments or advances.  An
Indemnitee shall be entitled to be indemnified for all Expenses incurred in
connection with such a Proceeding in accordance with Section 2 and to have such
Expenses advanced by the Company in accordance with Section 4(b).  If an
Indemnitee fails to timely challenge an Adverse Determination, or if an
Indemnitee challenges an Adverse Determination and such Adverse Determination
has been upheld by a final judgment of a court of competent jurisdiction from
which no appeal can be taken, then, to the extent and only to the extent
required by such Adverse Determination or final judgment, the Indemnifying
Parties shall not be obligated to indemnify or advance expenses to such
Indemnitee under this Agreement.

 

(g)                                  Presumptions; Burden and Standard of
Proof.  In connection with any Determination, or any review of any
Determination, by any person, including a court:

 

(i)                                     It shall be a presumption that a
Determination is not required.

 

(ii)                                  It shall be a presumption that an
Indemnitee has met the applicable standard of conduct and that indemnification
of such Indemnitee is proper in the circumstances.

 

(iii)                               The burden of proof shall be on the
Indemnifying Parties to overcome the presumptions set forth in the preceding
clauses (i) and (ii), and each such presumption shall only be overcome if the
Indemnifying Parties establish that there is no reasonable basis to support it.

 

(iv)                              The termination of any Proceeding by judgment,
order, finding, settlement (whether with or without court approval) or
conviction, or upon a plea of nolo contendere, or its equivalent, shall not
create a presumption that indemnification is not proper or that an Indemnitee
did not meet the applicable standard of conduct or that a court has determined
that indemnification is not permitted by this Agreement or otherwise.

 

(v)                                 Neither the failure of any person or persons
to have made a Determination nor an Adverse Determination by any person or
persons shall be a defense to an Indemnitee’s claim or create a presumption that
an Indemnitee did not meet the applicable standard of conduct, and any
Proceeding commenced by an Indemnitee pursuant to Section 4(f) shall be de novo
with respect to all determinations of fact and law.

 

12

--------------------------------------------------------------------------------

 

5.                                      Certain Covenants.  The rights of each
Indemnitee to be indemnified under any other agreement, document, certificate or
instrument or applicable law are independent of and in addition to any rights of
such Indemnitee to be indemnified under this Agreement.  The rights of each
Indemnitee and the obligations of the Indemnifying Parties hereunder shall
remain in full force and effect regardless of any investigation made by or on
behalf of such Indemnitee.  Each of the Company Entities, and each of their
corporate successors, shall implement and maintain in full force and effect any
and all corporate charter and by-law provisions that may be necessary or
appropriate to enable it to carry out its obligations hereunder to the fullest
extent permitted by applicable law, including without limitation a provision of
its certificate of incorporation (or comparable organizational document under
its jurisdiction of incorporation) eliminating liability of a director for
breach of fiduciary duty to the fullest extent permitted by applicable law, as
amended from time to time.  So long as the Company or any other member of the
Company Group maintains liability insurance for any directors, officers,
employees or agents of any such Person, the Indemnifying Parties shall ensure
that each Indemnitee serving in such capacity is covered by such insurance in
such a manner as to provide Indemnitee the same rights and benefits as are
accorded to the most favorably insured of the Company’s and the Company Group’s
then current directors and officers.  No Indemnifying Party shall seek or agree
to any order of a court or other governmental authority that would prohibit or
otherwise interfere with the performance of any of the Indemnifying Parties’
advancement, indemnification and other obligations under this Agreement.

 

6.                                      Notices.  All notices and other
communications hereunder shall be in writing and shall be delivered by certified
or registered mail (first class postage prepaid and return receipt requested),
telecopier, overnight courier or hand delivery, as follows:

 

(a)  If to any Company Entity, to:

 

ServiceMaster Global Holdings, Inc.

860 Ridge Lake Boulevard

Memphis, Tennessee 38120

Attention: General Counsel

Facsimile: (901) 597-8821

 

with a copy to (which shall not constitute notice):

 

Clayton, Dubilier & Rice, Inc.
375 Park Avenue
18th Floor
New York, New York  10152
Attention:  Mr. David H. Wasserman
Facsimile:  (212) 893-7061

 

13

--------------------------------------------------------------------------------

 

(b)  If to the Consultant, to it at:

 

Ridgemont Partners Management, LLC

150 North College Street, Suite 2500

Charlotte, NC 28202

Attention:  Edward Balogh

Facsimile:  (704) 944-0973

 

with a copy to (which shall not constitute notice):

 

Kirkland & Ellis LLP

300 North LaSalle

Chicago, IL 60654

Attention: Margaret A. Gibson

Facsimile: (312) 862-2200

 

or to such other address or such other person as the Company Entities or the
Consultant, as the case may be, shall have designated by notice to the other
parties hereto.  All communications hereunder shall be effective upon receipt by
the party to which they are addressed.  A copy of any notice or other
communication given under this Agreement shall also be given to:

 

Debevoise & Plimpton LLP
919 Third Avenue
New York, New York  10022
Attention:  Peter J. Loughran, Esq.
Facsimile:  (212) 909-6836

 

7.                                      Arbitration

 

(a)                                Any dispute, claim or controversy arising out
of, relating to, or in connection with this contract, or the breach,
termination, enforcement, interpretation or validity thereof, including the
determination of the scope or applicability of this agreement to arbitrate,
shall be finally determined by arbitration.  The arbitration shall be
administered by JAMS.  If the disputed claim or counterclaim exceeds $250,000,
not including interest or attorneys’ fees, the JAMS Comprehensive Arbitration
Rules and Procedures (“JAMS Comprehensive Rules”) in effect at the time of the
arbitration shall govern the arbitration, except as they may be modified herein
or by mutual written agreement of the parties.  If no disputed claim or
counterclaim exceeds $250,000, not including interest or attorneys’ fees, the
JAMS Streamlined Arbitration Rules and Procedures (“JAMS Streamlined Rules”) in
effect at the time of the arbitration shall

 

14

--------------------------------------------------------------------------------

 

govern the arbitration, except as they may be modified herein or by mutual
written agreement of the parties.

 

(b)                                The seat of the arbitration shall be New
York, New York.  The parties submit to jurisdiction in the state and federal
courts of the State of New York for the limited purpose of enforcing this
agreement to arbitrate.

 

(c)                                 The arbitration shall be conducted by one
neutral arbitrator unless the parties agree otherwise.  The parties agree to
seek to reach agreement on the identity of the arbitrator within thirty (30)
days after the initiation of arbitration.  If the parties are unable to reach
agreement on the identity of the arbitrator within such time, then the
appointment of the arbitrator shall be made in accordance with the process set
forth in JAMS Comprehensive Rule 15.

 

(d)                                The arbitration award shall be in writing,
state the reasons for the award, and be final and binding on the parties.  The
arbitrator may, in the award, allocate all or part of the costs of the
arbitration, including the fees of the arbitrator and the attorneys’ fees of the
prevailing party.  Judgment on the award may be entered by any court having
jurisdiction thereof or having jurisdiction over the relevant party or its
assets.  Notwithstanding applicable state law, the arbitration and this
agreement to arbitrate shall be governed by the Federal Arbitration Act, 9
U.S.C. § 1, et seq.

 

(e)                                 The parties agree that the arbitration shall
be kept confidential and that  the existence of the proceeding and any element
of it (including but not limited to any pleadings, briefs or other documents
submitted or exchanged, any testimony or other oral submissions, and any awards)
shall not be disclosed beyond the tribunal, JAMS, the parties, their counsel,
accountants and auditors, insurers and re-insurers, and any person necessary to
the conduct of the proceeding.  The confidentiality obligations shall not apply
(i) if disclosure is required by law, or in judicial or administrative
proceedings, or (ii) as far as disclosure is necessary to enforce the rights
arising out of the award.

 

8.                                      Termination.  This Agreement shall
terminate automatically upon the termination of the Consulting Agreement in
accordance with its terms.  The provisions of this agreement shall not survive
any termination hereof, provided that, notwithstanding the foregoing, the
obligations in Sections 2 through 4 of this Agreement shall survive any
termination solely with respect to any Obligations relating to any Securities
Offering, Related Document or the performance of any Consulting Services, in
each case, arising out of any facts, circumstances or events which occurred
prior to the date of such termination.

 

9.                                      Governing Law.  This Agreement shall be
governed in all respects, including validity, interpretation and effect, by the
law of the State of New York, regardless of the law that might be applied under
principles of conflict of laws to the

 

15

--------------------------------------------------------------------------------

 

extent such principles would require or permit the application of the laws of
another jurisdiction.

 

10.                               Severability.  If any provision or provisions
of this Agreement shall be held to be invalid, illegal or unenforceable, the
validity, legality and enforceability of the remaining provisions hereof shall
not in any way be affected or impaired thereby.

 

11.                               Successors; Binding Effect.  Each Indemnifying
Party will require any successor (whether direct or indirect, by purchase,
merger, consolidation, reorganization or otherwise) to all or substantially all
of the business and assets of such Indemnifying Party, by agreement in form and
substance satisfactory to the Consultant and its counsel, expressly to assume
and agree to perform this Agreement in the same manner and to the same extent
that such Indemnifying Party would be required to perform if no such succession
had taken place.  This Agreement shall be binding upon and inure to the benefit
of each party hereto and its successors and permitted assigns, and each other
Indemnitee, but neither this Agreement nor any right, interest or obligation
hereunder shall be assigned, whether by operation of law or otherwise, by the
Company Entities without the prior written consent of the Consultant.

 

12.                               Miscellaneous.  The headings contained in this
Agreement are for reference purposes only and shall not affect in any way the
meaning or interpretation of this Agreement.  This Agreement is not intended to
confer any right or remedy hereunder upon any Person other than each of the
parties hereto and their respective successors and permitted assigns and each
other Indemnitee.  No amendment, modification, supplement or discharge of this
Agreement, and no waiver hereunder shall be valid and binding unless set forth
in writing and duly executed by the party or other Indemnitee against whom
enforcement of the amendment, modification, supplement or discharge is sought. 
Neither the waiver by any of the parties hereto or any other Indemnitee of a
breach of or a default under any of the provisions of this Agreement, nor the
failure by any party hereto or any other Indemnitee on one or more occasions, to
enforce any of the provisions of this Agreement or to exercise any right, powers
or privilege hereunder, shall be construed as a waiver of any other breach or
default of a similar nature, or as a waiver of any provisions hereof, or any
rights, powers or privileges hereunder.  The rights, indemnities and remedies
herein provided are cumulative and are not exclusive of any rights, indemnities
or remedies that any party or other Indemnitee may otherwise have by contract,
at law or in equity or otherwise; provided  that (i) to the extent that any
Indemnitee is entitled to be indemnified by any member of the Company Group and
by any other Indemnitee or any insurer under a policy procured by any
Indemnitee, the obligations of the members of the Company Group hereunder shall
be primary and the obligations of such other Indemnitee or insurer secondary,
and (ii) no member of the Company Group shall be entitled to contribution or
indemnification from or subrogation against such other Indemnitee or insurer. 
This Agreement may be executed in several

 

16

--------------------------------------------------------------------------------

 

counterparts, each of which shall be deemed an original, and all of which
together shall constitute one and the same instrument.

 

[The remainder of this page has been left blank intentionally.]

 

17

--------------------------------------------------------------------------------

 

IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement by
their authorized representatives as of the date first above written.

 

 

RIDGEMONT PARTNERS MANAGEMENT, LLC

 

 

 

 

 

By:

/s/ Edward A. Balogh, Jr.

 

 

Name:

Edward A. Balogh, Jr.

 

 

Title:

COO

 

 

 

 

 

SERVICEMASTER GLOBAL HOLDINGS, INC.

 

 

 

 

 

By:

/s/ Alan J. M. Haughie

 

 

Name:

Alan J. M. Haughie

 

 

Title:

SVP & CFO

 

 

 

 

 

THE SERVICEMASTER COMPANY, LLC

 

 

 

 

 

By:

/s/ Alan J. M. Haughie

 

 

Name:

Alan J. M. Haughie

 

 

Title:

SVP & CFO

 

--------------------------------------------------------------------------------