EX-10.2






Exhibit 10.2




EXECUTION COPY




AMENDED AND RESTATED SEVERANCE AGREEMENT




          This Amended and Restated Severance Agreement (this “Agreement”), effective as of July 15, 2008,
is made between ABM Industries Incorporated, a Delaware corporation (the “Company”), and the
individual executing this Agreement as the Executive on the signature page (the “Executive”).




RECITALS




     A. The Executive is a senior executive of the Company and has made and is expected to continue
to make major contributions to the short- and long-term profitability, growth and financial
strength of the Company;



     B. The Company recognizes that the possibility of a Change in Control exists and that such
possibility, and the uncertainty it may create among management, may result in the distraction or
departure of management personnel, to the detriment of the Company and its stockholders, including
a reduction of the value received by stockholders in a Change in Control transaction;



     C. The Executive and the Company are party to a Severance Agreement dated December 13, 2005
(the “Prior Agreement”);



     D. The parties desire to amend and restate the Prior Agreement to reflect changes required to
comply with Section 409A and Section 162(m) of the Code;



     E. The Company desires to assure itself of both present and future continuity of management
and to establish fixed severance benefits for certain of its senior executives, including the
Executive, applicable in the event of a Change in Control; and



     F. The Company desires to provide additional inducement for the Executive to continue to
remain in the employ of the Company. Accordingly, the Company and the Executive agree as follows:



     1. Certain Defined Terms. In addition to terms defined elsewhere herein, the following
terms have the following meanings when used in this Agreement with initial capital letters:



          (a) “After-Tax Amount” means the amount to be received by an Executive determined on an
after-tax basis taking into account the excise tax imposed pursuant to Section 4999 of the Code, or
any successor provision thereto, any tax imposed by any comparable provision of state law and any
applicable federal, state and local income and employment taxes.




          (b) “Base Pay” means the Executive’s annual base salary rate as in effect at the time a
determination is required to be made under Section 4.




 









 








          (c) “Board” means the Board of Directors of the Company; any action of the Board herein
contemplated will be valid if adopted by a majority of the total number of directors then in office
or a majority of the Incumbent Directors and, for purposes of interpreting, amending or waiving any
portion of this Agreement, may be adopted by a majority of the Incumbent Directors by written
action, whether or not unanimous, or may be delegated by specific action of the Board of Directors
after the date hereof to any directorate committee comprised solely of Incumbent Directors who are
also Independent Directors.




          (d) “Cause” means that, prior to any termination, the Executive shall have:




               (i) been charged with a crime involving fraud, embezzlement or theft in connection with
Executive’s duties or in the course of Executive’s employment with the Company or any Subsidiary or
been convicted of a felony;



               (ii) intentionally breached his fiduciary obligations to the Company or any securities laws
applicable to the Company; or



               (iii) committed intentional wrongful engagement in any Competitive Activity;




and any such act shall have been demonstrably and materially harmful to the Company. For purposes of this
Agreement, no act or failure to act on the part of the Executive will be deemed “intentional” if it
was due primarily to an error in judgment or negligence, but will be deemed “intentional” only if
done or omitted to be done by the Executive not in good faith and without reasonable belief that
the Executive’s action or omission was in the best interest of the Company. Notwithstanding the
foregoing, the Executive will not be deemed to have been terminated for “Cause” hereunder unless
and until there shall have been delivered to the Executive a copy of a resolution duly adopted by
the Board at a meeting of the Board called and held for such purpose, after reasonable notice to
the Executive and an opportunity for the Executive, together with the Executive’s counsel (if the
Executive chooses to have counsel present at such meeting), to be heard before the Board, finding
that, in the good faith opinion of the Board after consultation with outside counsel, there is
clear and convincing evidence that the Executive had committed an act constituting “Cause” as
herein defined and specifying the particulars thereof in reasonable detail. Nothing herein will
limit the right of the Executive or Executive’s beneficiaries to contest the validity or propriety
of any such determination.



          (e) “Change in Control” means that during the Term any of the following events occurs,
provided that the occurrence of such event constitutes a “change in effective ownership or control”
of the Company, as defined in Section 409A:




               (i) any individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the
Exchange Act) (a “Person”) (A) is or becomes the beneficial owner (within the meaning of Rule 13d-3
promulgated under the Exchange Act) of more than 35% of the combined voting power of the
then-outstanding Voting Stock of the Company or succeeds in having nominees as directors elected in
an “election contest”



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within the meaning of Rule 14a-12(c) under the Exchange Act and (B) within 18 months after
either such event, individuals who were members of the Board of Directors of the Company
immediately prior to either such event cease to constitute a majority of the members of the Board
of Directors of the Company; or




               (ii) a majority of the Board ceases to be comprised of Incumbent Directors; or



               (iii) the consummation of a reorganization, merger, consolidation, plan of liquidation or
dissolution, recapitalization or sale or other disposition of all or substantially all of the
assets of the Company or the acquisition of the stock or assets of another corporation, or other
transaction (each, a “Business Transaction”), unless, in any such case, (A) no Person (other than
the Company, any entity resulting from such Business Transaction or any employee benefit plan (or
related trust) sponsored or maintained by the Company, any Subsidiary or such entity resulting from
such Business Transaction) beneficially owns, directly or indirectly, 35% or more of the combined
voting power of the then-outstanding shares of Voting Stock of the entity resulting from such
Business Transaction or, if it is such entity, the Company and (B) at least one-half of the members
of the Board of Directors of the entity resulting from such Business Transaction were Incumbent
Directors at the time of the execution of the initial agreement providing for such Business
Transaction.



          (f) “Code” means the Internal Revenue Code of 1986, as amended.




          (g) “Competitive Activity” means the Executive’s participation, without the written consent
signed by an officer of the Company and authorized by the Board, in the management of any business
enterprise if (i) such enterprise engages in substantial and direct competition with the Company
and such enterprise’s sales of any product or service competitive with any product or service of
the Company amounted to 10% of such enterprise’s net sales for its most recently completed fiscal
year and if the Company’s net sales of said product or service amounted to 10% of the Company’s net
sales for its most recently completed fiscal year or (ii) the primary business done or intended to
be done by such enterprise is in direct competition with the business of providing facility
services in any geographic market in which the Company operates. “Competitive Activity” will not
include the mere ownership of securities in any such enterprise and the exercise of rights
appurtenant thereto, if such ownership is less than 5% of the outstanding voting securities or
units of such enterprise.




          (h) “Employee Benefits” means the benefits and service credit for benefits as provided under
any and all employee retirement income and welfare benefit policies, plans, programs or
arrangements in which the Executive is entitled to participate, including without limitation any
stock option, performance share, performance unit, stock purchase, stock appreciation, savings,
pension, supplemental executive retirement, or other retirement income or welfare benefit, deferred
compensation, incentive compensation, group or other life, health, medical/hospital or other
insurance (whether funded by actual insurance or self-insured by the Company or a Subsidiary),
disability, salary continuation, expense reimbursement and other employee benefit policies, plans,



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programs or arrangements that may now exist or any equivalent successor policies, plans,
programs or arrangements that may be adopted hereafter by the Company or a Subsidiary, providing
benefits and service credit for benefits at least as great in the aggregate as are payable
thereunder immediately prior to a Change in Control.




          (i) “ERISA” means the Employee Retirement Income Security Act of 1976, as amended




          (j) “Excess Parachute Payment” means a payment that creates an obligation for Executive to pay
excise taxes under Section 280G of the Code or any successor provision thereto.




          (k) “Exchange Act” means the Securities Exchange Act of 1934, as amended.




          (l) “Good Reason” means the occurrence of one or more of the following events:




               (i) Failure to elect or reelect or otherwise to maintain the Executive in the office or the
position he had with the Company immediately prior to a Change in Control, or a substantially
equivalent or better office or position than that which he had with the Company immediately prior
to the Change in Control, in either such case with the Company, any legal successor to the Company
or, if the Company merges with or into another entity with substantial operations, with respect to
the business of the Company and its Subsidiaries substantially as conducted immediately prior to
the Change in Control;



               (ii) Failure of the Company to remedy any of the following within 30 calendar days after
receipt by the Company of written notice thereof from the Executive: (A) a significant adverse
change in the nature or scope of the authorities, powers or functions attached to the position with
the Company which the Executive held immediately prior to the Change in Control, (B) a material
reduction in the Executive’s Base Pay, (C) a material reduction in the Executive’s Incentive Pay
Opportunity or Incentive Pay Target, or (D) the termination or denial of the Executive’s rights to
material Employee Benefits or a material reduction in the scope or value thereof, unless such
termination or reduction referred to in clauses (B), (C) or (D) applies on a substantially similar
basis to all executives of the Company and its parent entities or such right is replaced with a
right with a substantially similar scope or value;



               (iii) The liquidation, dissolution, merger, consolidation or reorganization of the Company or
the transfer of all or substantially all of its business and/or assets, unless the successor or
successors (by liquidation, merger, consolidation, reorganization, transfer or otherwise) to which
all or substantially all of its business and/or assets have been transferred (by operation of law
or otherwise) assumed all duties and obligations of the Company under this Agreement pursuant to
Section 11(a);



               (iv) If the Executive’s principal residence at the time in question is within 35 miles of the
Company’s headquarters or the headquarters of the Subsidiary



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that is Executive’s employer, the Company requires the Executive to have Executive’s principal
location of work changed to any location that is in excess of 50 miles from such residence without
Executive’s prior written consent; or




               (v) Without limiting the generality or effect of the foregoing, any material breach of this
Agreement or any Other Employment Agreement (as defined in Section 6) by the Company or any
successor thereto which is not remedied by the Company within 10 calendar days after receipt by the
Company of written notice from the Executive of such breach.


A termination of employment by the Executive for one of the reasons set forth in clauses (i) — (v),
above, will not constitute “Good Reason” unless, within the 60-day period immediately following the
occurrence of such Good Reason event, the Executive has given written notice to the Company
specifying in reasonable detail the event or events relied upon for such termination and the
Company has not remedied such event or events within 10 days of the receipt of such notice. The
Company and the Executive may mutually waive in writing any of the foregoing provisions with
respect to an event or events that otherwise would constitute Good Reason.




          (m) “Incumbent Directors” means the individuals who, as of the date hereof, are Directors of
the Company and any individual becoming a Director subsequent to the date hereof whose election,
nomination for election by the Company’s shareholders or appointment was approved by a vote of at
least two-thirds of the then Incumbent Directors (either by a specific vote or by approval of the
proxy statement of the Company in which such person is named as a nominee for director, without
objection to such nomination); provided, however, that an individual shall not be an Incumbent
Director if such individual’s election or appointment to the Board occurs as a result of an actual
or threatened election contest (as described in Rule 14a-12(c) of the Exchange Act) with respect to
the election or removal of Directors or other actual or threatened solicitation of proxies or
consents by or on behalf of a Person other than the Board.




          (n) “Incentive Pay” means compensation in addition to Base Pay determined by reference to one
or more performance measures, whether payable in cash, securities or otherwise.




          (o) “Incentive Pay Opportunity” means the maximum amount of Incentive Pay that the Executive
would receive pursuant to any Incentive Pay Plan in existence immediately prior to a Change in
Control (disregarding the effects of the Change in Control, including without limitation increased
depreciation or amortization, financing expense and transaction costs), assuming satisfaction of
all thresholds or other conditions thereto established (i) prior to the Change in Control or (ii)
after the Change in Control either (A) with the Executive’s specific prior written approval or (B)
by action of a committee of the Board comprised solely of Independent Directors.




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          (p) “Incentive Pay Plan” means any plan, program, agreement or arrangement (excluding employee
stock options, restricted stock or other rights the value of which is determined solely by
reference to the value of the Company’s common stock).




          (q) “Incentive Pay Target” means the amount or value of Incentive Pay the Executive would have
received assuming that the Incentive Pay Plans in effect immediately prior to the Change in Control
continue unchanged and are satisfied at the target level and, if applicable, any conditions to
entitlement to payment at the target level thereunder that are not measured by the Company’s
results of operation are satisfied at the target level.




          (r) “Independent Directors” means directors who qualify as “independent” directors under
then-applicable New York Stock Exchange rules applicable to compensation committees (whether or not
the Company’s securities continue to be listed for trading thereon).




          (s) “Other Agreement” means an agreement, contract or understanding (including any option or
equity plan or agreement) other than this Agreement, heretofore or hereafter entered into by the
Executive with the Company or any Subsidiary.




          (t) “Retirement Plans” means the benefit plans of the Company that are intended to be
qualified under Section 401(a) of the Code and any supplemental executive retirement benefit plan
or any other plan that is a successor thereto as such Retirement Plans were in effect immediately
prior to the Change in Control and if the Executive was a participant in such Retirement Plan
immediately prior to the Change in Control.




          (u) Section 162(m) means Section 162(m) of the Code, and the regulations and guidance
promulgated thereunder, or any successor statute.




          (v) Section 409A means Section 409A of the Code, and the regulations and guidance promulgated
thereunder, or any successor statute.




          (w) “Severance Period” means the period of time commencing on the date of the first occurrence
of a Change in Control and continuing until the earlier of (i) the second anniversary of the
occurrence of the Change in Control and (ii) the Executive’s death.




          (x) “Subsidiary” means an entity in which the Company directly or indirectly beneficially owns
50% or more of the outstanding Voting Stock.




          (y) “Term” means the period commencing as of the date hereof and expiring on the close of
business on December 31, 2008; provided, however, that (i) commencing on January 1, 2009 and each
January 1 thereafter, the term of this Agreement will automatically be extended for an additional
year unless, not later than September 30 of the immediately preceding year, the Company or the
Executive shall have given notice that it or the Executive, as the case may be, does not wish to
have the Term extended; (ii) if a Change in Control occurs during the Term, the Term will expire



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on the last day of the Severance Period; and (iii) subject to Section 3(c), if, prior to a
Change in Control, the Executive ceases for any reason to be a full-time employee of the Company,
thereupon without further action the Term shall be deemed to have expired and this Agreement will
immediately terminate and be of no further effect.




          (z) “Termination Date” means the date on which the Executive’s employment is terminated (the
effective date of which will be the date of termination, or such other date that may be specified
by the Executive if the termination is pursuant to Section 3(b)).




          (aa) “Voting Stock” means securities entitled to vote generally in the election of directors.




          (bb) “Welfare Benefits” means Employee Benefits that are provided under any “welfare plan”
(within the meaning of Section 3(1) of ERISA) of the Company, and fringe benefits and other
perquisites of employment, such as car allowances, club dues, financial planning and product
discounts.




     2. Operation of Agreement. This Agreement will be effective and binding immediately upon
its execution, but, anything in this Agreement to the contrary notwithstanding, except as provided
in Section 3(c), this Agreement will not be operative unless and until a Change in Control occurs.
Upon the occurrence of a Change in Control at any time during the Term, without further action,
this Agreement will become immediately operative.



     3. Termination Following a Change in Control. (a) In the event of the occurrence of a
Change in Control, the Executive’s employment may be terminated by the Company during the Severance
Period and the Executive will be entitled to the benefits provided by Section 4 unless such
termination is the result of the occurrence of one or more of the following events:



               (i) The Executive’s death;



               (ii) if the Executive becomes permanently disabled within the meaning of, and begins actually
to receive disability benefits pursuant to, the long-term disability plan in effect for, or
applicable to, the Executive immediately prior to the Change in Control; or



               (iii) Cause.


If, during the Severance Period, the Executive’s employment is terminated by the Company other than
pursuant to Section 3(a)(i), 3(a)(ii) or 3(a)(iii), the Executive will be entitled to the benefits
provided by Section 4, provided that such termination constitutes a “separation from service” as
defined in Section 409A.




          (b) In the event of the occurrence of a Change in Control, the Executive may terminate
employment with the Company during the Severance Period for



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Good Reason with the right to severance compensation as provided in Section 4 regardless of
whether any other reason, other than Cause, for such termination exists or has occurred, including
without limitation other employment.




          (c) Nothing in this Agreement will (i) be construed as creating an express or implied contract
of employment, changing the status of Executive as an employee at will, giving Executive any right
to be retained in the employ of the Company, or giving Executive the right to any particular level
of compensation or benefits or (ii) interfere in any way with the right of the Company to terminate
the employment of the Executive at any time with or without Cause, subject in either case to the
obligations of the Company under this Agreement.




     4. Severance Compensation. (a) If, following the occurrence of a Change in Control, the
Company terminates the Executive’s employment during the Severance Period other than pursuant to
Section 3(a)(i), 3(a)(ii) or 3(a)(iii), or if the Executive terminates Executive’s employment
pursuant to Section 3(b) (any such termination, a “Triggering Termination”), provided that such
Triggering Termination constitutes a “separation from service” as defined in Section 409A, the
Company will pay to the Executive the amounts described in Annex A within five business days after
the Termination Date (subject to the provisions of Section 4(d) of this Agreement) and will
continue to provide to the Executive the benefits described in Annex A for the periods described
therein.



          (b) Without limiting the rights of the Executive at law or in equity, if the Company fails to
make any payment or provide any benefit required to be made or provided hereunder on a timely
basis, the Company will pay interest on the amount or value thereof at an annualized rate of
interest equal to the “prime rate” as set forth from time to time during the relevant period in The
Wall Street Journal “Money Rates” column, plus 200 basis points, compounded monthly, or, if less,
the maximum rate legally allowed. Such interest will be payable as it accrues on demand. Any
change in such prime rate will be effective on and as of the date of such change.




          (c) Unless otherwise expressly provided by the applicable plan, program or agreement, after
the occurrence of a Change in Control, the Company will pay in cash to the Executive a lump sum
amount equal to the sum of (i) any unpaid Incentive Pay that has been earned, accrued, allocated or
awarded to the Executive for any performance period that by its terms as in effect prior to a
Triggering Termination has been completed (any such period, a “Completed Performance Period”)
(regardless of whether payment of such compensation would otherwise be contingent on the continuing
performance of services by the Executive) and (ii) the Pro Rata Portion of the Incentive Pay Target
in effect for any subsequent performance period. For this purpose, “Pro Rata Portion” means (x)
the number of days from and including the first day immediately following the last day of the
immediately preceding Completed Performance Period to and including the Termination Date, divided
by (y) the total number of days in such subsequent performance period. Such payments will be made
at the earlier of (x) the date prescribed for payment pursuant to the applicable plan, program or
agreement and (y)



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within five business days after the Termination Date, and will be payable and calculated
disregarding any otherwise applicable vesting requirements.




          (d) To the extent required in order to avoid accelerated taxation and/or tax penalties under
Section 409A, amounts that would otherwise be payable and benefits that would otherwise be provided
pursuant to this Agreement during the six-month period immediately following the Executive’s
termination of employment shall instead be paid on the first business day after the date that is
six months following the Executive’s termination of employment (or upon the Executive’s death, if
earlier). In addition, for purposes of this Agreement, each amount to be paid or benefit to be
provided shall be construed as a separate identified payment for purposes of Section 409A, and any
payments described in Annex A that are due within the “short term deferral period” as defined in
Section 409A shall not be treated as deferred compensation unless applicable law requires
otherwise.




     5. Limitations on Payments and Benefits. Notwithstanding any provision of this Agreement
or any Other Agreement to the contrary, if any amount or benefit to be paid or provided under this
Agreement or any Other Agreement would be an Excess Parachute Payment (including after taking into
account the value, to the maximum extent permitted by Section 280G of the Code, of the covenants in
Section 8 hereof), but for the application of this sentence, then the payments and benefits to be
paid or provided under this Agreement and any Other Agreement will be reduced to the minimum extent
necessary (but in no event to less than zero) so that no portion of any such payment or benefit, as
so reduced, constitutes an Excess Parachute Payment; provided, however, that the foregoing
reduction will not be made if such reduction would result in Executive receiving an After-Tax
Amount less than 90% of the After-Tax Amount of the severance payments he or she would have
received under Section 4 or under any Other Agreement without regard to this clause. Whether
requested by the Executive or the Company, the determination of whether any reduction in such
payments or benefits to be provided under this Agreement or otherwise is required pursuant to the
preceding sentence, and the value to be assigned to the Executive’s covenants in Section 8 hereof
for purposes of determining the amount, if any, of the Excess Parachute Payment will be made at the
expense of the Company by the Company’s independent accountants or benefits consultant. The fact
that the Executive’s right to payments or benefits may be reduced by reason of the limitations
contained in this Section 5 will not of itself limit or otherwise affect any other rights of the
Executive pursuant to this Agreement or any Other Agreement. In the event that any payment or
benefit intended to be provided is required to be reduced pursuant to this Section 5, the Executive
will be entitled to designate the payments and/or benefits to be so reduced in order to give effect
to this Section 5, provided, however, that payments that do not constitute deferred compensation
within the meaning of Section 409A shall be reduced first. The Company will provide the Executive
with all information reasonably requested by the Executive to permit the Executive to make such
designation. In the event that the Executive fails to make such designation within 10 business
days after receiving notice from the Company of a reduction under this Section 5, the Company may
effect such reduction in any manner it deems appropriate.



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     6. No Mitigation Obligation; Other Agreements. (a) The Company hereby acknowledges that it
will be difficult and may be impossible for the Executive to find reasonably comparable employment
following the Termination Date. Accordingly, the payment of the severance compensation by the
Company to the Executive in accordance with the terms of this Agreement is hereby acknowledged by
the Company to be reasonable, and the Executive will not be required to mitigate the amount of any
payment provided for in this Agreement by seeking other employment or otherwise, nor will any
profits, income, earnings or other benefits from any source whatsoever create any mitigation,
offset, reduction or any other obligation on the part of the Executive hereunder or otherwise,
except as expressly provided in Paragraph 2(E) of 

Annex A.



          (b) A termination of employment pursuant to Section 3(a), 3(b) or 3(c) will not affect any
rights that the Executive may have pursuant to any agreement, policy, plan, program or arrangement
of the Company or Subsidiary providing Employee Benefits, which rights will be governed by the
terms thereof. To the extent that the Executive receives payments by reason of his or her
termination of employment pursuant to any other employment or severance agreement or employee plan
(collectively, “Other Employment Agreements”), the amounts otherwise receivable under Section 4
will be reduced by the amounts actually paid pursuant to the Other Employment Agreements, but not
below zero, to avoid duplication of payments so that the total amount payable or value of benefits
receivable hereunder and under the Other Employment Agreements is not less than the amounts so
payable or value so receivable had such benefits been paid in full hereunder.




     7. Legal Fees and Expenses. It is the intent of the Company that the Executive not be
required to incur legal fees and the related expenses associated with the interpretation,
enforcement or defense of Executive’s rights in connection with any dispute arising under this
Agreement because the cost and expense thereof would substantially detract from the benefits
intended to be extended to the Executive hereunder. Accordingly, if it should appear to the
Executive that the Company has failed to comply with any of its obligations under this Agreement or
in the event that the Company or any other person takes or threatens to take any action to declare
this Agreement void or unenforceable, or institutes any proceeding designed to deny, or to recover
from, the Executive the benefits provided or intended to be provided to the Executive hereunder,
the Company irrevocably authorizes the Executive from time to time to retain counsel of Executive’s
choice, at the expense of the Company as hereafter provided, to advise and represent the Executive
in connection with any such dispute or proceeding. Without respect to whether the Executive
prevails, in whole or in part, in connection with any of the foregoing, the Company will pay and be
solely financially responsible for any and all reasonable attorneys’ and related fees and expenses
incurred by the Executive in connection with any of the foregoing; provided that, in regard to such
matters, the Executive has not acted in bad faith or with no colorable claim of success. The
Executive shall promptly submit a written request for reimbursement of such expenses, but in no
event later than ninety days following the date on which such expenses were incurred, accompanied
by such evidence of fees and expenses incurred as the Company may reasonably require, and such
reimbursements will be made within ten business days after delivery of the Executive’s written
requests for payment.



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     8. Competitive Activity; Confidentiality; Nonsolicitation. (a) For the period following
the Termination Date specified in Paragraph (3) of Annex A (the “Non-Competition Period”), subject
to the Executive’s receipt of benefits under Section 4, the Executive will not, without the prior
written consent of the Company, which consent will not be unreasonably withheld, engage in any
Competitive Activity.



          (b) During the Term, the Company agrees that it will disclose to Executive its confidential or
proprietary information (as defined in this Section 8(b)) to the extent necessary for Executive to
carry out Executive’s obligations to the Company. The Executive hereby covenants and agrees that
Executive will not, without the prior written consent of the Company, during the Term and two years
thereafter disclose to any person not employed by the Company, or use in connection with engaging
in competition with the Company, any confidential or proprietary information of the Company. For
purposes of this Agreement, the term “confidential or proprietary information” will include all
information of any nature and in any form that is owned by the Company and that is not publicly
available (other than by Executive’s breach of this 

Section 8(b)) or generally known to persons
engaged in businesses similar or related to those of the Company. Confidential or proprietary
information will include, without limitation, the Company’s financial matters, customers,
employees, industry contracts, strategic business plans, product development (or other proprietary
product data), marketing plans, and all other secrets and all other information of a confidential
or proprietary nature. For purposes of the preceding two sentences, the term “Company” will also
include any Subsidiary (collectively, the “Restricted Group”). The obligations imposed by this
Section 8(b) will not apply (i) during the Term, in the course of the business of and for the
benefit of the Company, (ii) if such confidential or proprietary information has become, through no
fault of the Executive, generally known to the public or (iii) if the Executive is required by law
to make disclosure (after giving the Company notice and an opportunity to contest such
requirement).




          (c) The Executive hereby covenants and agrees that for a period ending one year after the
Termination Date Executive will not, without the prior written consent of the Company, which
consent will not unreasonably be withheld as to Executive’s personal assistant, on behalf of
Executive or on behalf of any person, firm or company, directly or indirectly, attempt to
influence, persuade or induce, or assist any other person in so persuading or inducing, any
employee of the Restricted Group to give up, or to not commence, employment or a business
relationship with the Restricted Group.




          (d) Executive and the Company agree that the covenants contained in this Section 8 are
reasonable under the circumstances and subject to the provisions of Section 14 of this Agreement.
Executive acknowledges and agrees that the remedy at law available to the Company for breach of any
of Executive’s obligations under this Section 8 would be inadequate and that damages flowing from
such a breach may not readily be susceptible to being measured in monetary terms. Accordingly,
Executive acknowledges, consents and agrees that, in addition to any other rights or remedies that
the Company may have at law, in equity or under this Agreement, upon adequate proof of Executive’s
violation of any such provision of this Agreement, the Company will be



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entitled to immediate injunctive relief and may obtain a temporary order restraining any
threatened or further breach, without the necessity of proof of actual damage.




     9. Employment Rights. Nothing expressed or implied in this Agreement will create any right
or duty on the part of the Company or the Executive to have the Executive remain in the employment
of the Company or any Subsidiary prior to or following any Change in Control.



     10. Withholding of Taxes. The Company may withhold from any amounts payable under this
Agreement all federal, state, city or other taxes as the Company is required to withhold pursuant
to any applicable law, regulation or ruling.



     11. Successors and Binding Agreement. (a) The Company will require any successor (whether
direct or indirect, by purchase, merger, consolidation, reorganization or otherwise) to all or
substantially all of the business or assets of the Company, by agreement in form and substance
reasonably satisfactory to the Executive, expressly to assume and agree to perform this Agreement
in the same manner and to the same extent the Company would be required to perform if no such
succession had taken place. This Agreement will be binding upon and inure to the benefit of the
Company and any successor to the Company, including without limitation any persons acquiring
directly or indirectly all or substantially all of the business or assets of the Company whether by
purchase, merger, consolidation, reorganization or otherwise (and such successor will thereafter be
deemed the “Company” for the purposes of this Agreement), but will not otherwise be assignable,
transferable or delegable by the Company.



          (b) This Agreement will inure to the benefit of and be enforceable by the Executive’s personal
or legal representatives, executors, administrators, successors, heirs, distributees and legatees.




          (c) This Agreement is personal in nature and neither of the parties hereto will, without the
consent of the other, assign, transfer or delegate this Agreement or any rights or obligations
hereunder except as expressly provided in Sections 11(a) and 11(b). Without limiting the
generality or effect of the foregoing, the Executive’s right to receive payments hereunder will not
be assignable, transferable or delegable, whether by pledge, creation of a security interest, or
otherwise, other than by a transfer by Executive’s will or by the laws of descent and distribution
and, in the event of any attempted assignment or transfer contrary to this Section 11(c), the
Company will have no liability to pay any amount so attempted to be assigned, transferred or
delegated.




     12. Notices. For all purposes of this Agreement, all communications, including without
limitation notices, consents, requests or approvals, required or permitted to be given hereunder
will be in writing and will be deemed to have been duly given when hand delivered or dispatched by
electronic facsimile transmission (with receipt thereof orally confirmed), or five business days
after having been mailed by United States registered or certified mail, return receipt requested,
postage prepaid, or three business days after having been sent by a nationally recognized overnight
courier service such as FedEx or UPS, addressed to the Company (to the attention of the



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Secretary of the Company) at its principal executive office and to the Executive at Executive’s
principal residence, or to such other address as any party may have furnished to the other in
writing and in accordance herewith, except that notices of changes of address will be effective
only upon receipt.



     13. Governing Law. The validity, interpretation, construction and performance of this
Agreement will be governed by and construed in accordance with the substantive laws of the State of
Delaware and federal law, without giving effect to the principles of conflict of laws of such
State, except as expressly provided herein. In the event the Company exercises its discretion
under Section 8(d) to bring an action to enforce the covenants contained in Section 8 in a court of
competent jurisdiction where the Executive has breached or threatened to breach such covenants, and
in no other event, the parties agree that the court may apply the law of the jurisdiction in which
such action is pending in order to enforce the covenants to the fullest extent permissible.



     14. Validity. If any provision of this Agreement or the application of any provision
hereof to any person or circumstance is held invalid, unenforceable or otherwise illegal, including
without limitation Section 8 hereof, the remainder of this Agreement and the application of such
provision to any other person or circumstance will not be affected, and the provision so held to be
invalid, unenforceable or otherwise illegal will be reformed to the extent (and only to the extent)
necessary to make it enforceable, valid or legal. If any covenant in Section 8 should be deemed
invalid, illegal or unenforceable because its time, geographical area, or restricted activity, is
considered excessive, such covenant will be modified to the minimum extent necessary to render the
modified covenant valid, legal and enforceable.



     15. Miscellaneous. No provision of this Agreement may be modified, waived or discharged
unless such waiver, modification or discharge is agreed to in writing signed by the Executive and
the Company. No waiver by either party hereto at any time of any breach by the other party hereto
or compliance with any condition or provision of this Agreement to be performed by such other party
will be deemed a waiver of similar or dissimilar provisions or conditions at the same or at any
prior or subsequent time. No agreements or representations, oral or otherwise, expressed or
implied with respect to the subject matter hereof have been made by either party that are not set
forth expressly in this Agreement. The headings used in this Agreement are intended for
convenience or reference only and will not in any manner amplify, limit, modify or otherwise be
used in the construction or interpretation of any provision of this Agreement. References to
Sections are to Sections of this Agreement. References to Paragraphs are to Paragraphs of an Annex
to this Agreement. Any reference in this Agreement to a provision of a statute, rule or regulation
will also include any successor provision thereto.



     16. Survival. Notwithstanding any provision of this Agreement to the contrary, the
parties’ respective rights and obligations under Sections 3(c), 4, 5, 7, 8, 9, 10, 11(b), 16 and 18
will survive any termination or expiration of this Agreement or the termination of the Executive’s
employment following a Change in Control for any reason whatsoever.



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     17. Beneficiaries. The Executive will be entitled to select (and change, to the extent
permitted under any applicable law) a beneficiary or beneficiaries to receive any compensation or
benefit payable hereunder following the Executive’s death, and may change such election, in either
case by giving the Company written notice thereof in accordance with Section 12. In the event of
the Executive’s death or a judicial determination of the Executive’s incompetence, reference in
this Agreement to the “Executive” will be deemed, where appropriate, to the Executive’s
beneficiary, estate or other legal representative.



     18. Counterparts. This Agreement may be executed in one or more counterparts, each of
which will be deemed to be an original but all of which together will constitute one and the same
agreement.



     19. Section 409A. To the extent applicable, it is intended that this Agreement comply with
the provisions of Section 409A. This Agreement will be administered in a manner consistent with
this intent, and any provision that would cause the Agreement to fail to satisfy Section 409A will
have no force and effect until amended to comply with Section 409A (which amendment may be
retroactive to the extent permitted by Section 409A and may be made by the Company without the
consent of the Executive). Prior to any Change in Control, the Company and the Executive will
agree to any amendment of this Agreement approved by the Board based on the advice of Skadden,
Arps, Slate, Meagher & Flom, LLP or any other nationally recognized law firm designated by the
Board that such amendment, if implemented, is or is reasonably likely to reduce any adverse effect
on the Company or the Executive of any rule, regulation or IRS interpretation of Section 409A and
that such firm is recommending similar changes or provisions to its other clients that have
change-in-control, severance or employment agreements or plans.




[Remainder of this page is intentionally left blank]


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IN WITNESS WHEREOF, the parties have caused this Agreement to be duly executed and delivered as of
the date first above written.




	 	 	 	 	 	 	 
	 	 	ABM INDUSTRIES INCORPORATED	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Linda Chavez 	 	 
	 

	 	 	 	 


	 	 
	 

	 	Title:
	 	Chair of the Compensation Committee of the Board of Directors	 	 
	 
	 	 	 	 	 	 
	 	 	EXECUTIVE	 	 
	 
	 	 	 	 	 	 
	 	 	/s/ Henrik C. Slipsager	 	 






 









 






Annex A




SEVERANCE COMPENSATION, ETC.




     (1) A lump sum payment in an amount equal to two times the sum of (A) Base Pay (at the rate in
effect for the year in which the Termination Date occurs), plus (B) Incentive Pay Target (or, if
the Incentive Pay Target shall not have been established or shall be reduced after a Change in
Control, the highest aggregate Incentive Pay Target as in effect for any of the three fiscal years
immediately preceding the year in which the Change in Control occurred).



     (2) (A) For any Welfare Benefits that the Executive was receiving or entitled to receive
immediately prior to the Termination Date (or, if greater, immediately prior to the reduction,
termination or denial described in Section 1(1)(ii)) that are considered to be “reimbursement
arrangements” covered under Section 1.409A-1(b)(9)(iv)(A) of the Code:




	 	(i)	 	for a period of 18 months following the Termination Date (the
“Continuation Period”), the Company will arrange to provide the Executive with
Welfare Benefits substantially similar to those that the Executive was
receiving or entitled to receive immediately prior to the Termination Date
(or, if greater, immediately prior to the reduction, termination, or denial
described in Section 1(l)(ii)) except that the level of any such Welfare
Benefits to be provided to the Executive may be reduced in the event of a
corresponding reduction generally applicable to all similarly situated
recipients of or participants in such Welfare Benefits. If and to the extent
that any benefit described in this Paragraph 2 is not or cannot be paid or
provided under any policy, plan, program or arrangement of the Company or any
Subsidiary, as the case may be, then the Company will itself pay or provide
for the payment to the Executive, Executive’s dependents and beneficiaries, of
such Welfare Benefits along with, in the case of any benefit described in this
Paragraph 2 that is subject to tax because it is not or cannot be paid or
provided under any such policy, plan, program or arrangement of the Company or
any Subsidiary, an additional amount such that after payment by the Executive,
or Executive’s dependents or beneficiaries, as the case may be, of all taxes
so imposed, the recipient retains an amount equal to such taxes. Such tax
payment will be made to the Executive by the Company no later than December
31st of the year in which the Executive remits such tax payments to
the appropriate taxing authorities.




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	 	(ii)	 	the Company will pay to the Executive, in a lump sum within
the time period described in Section 4(a), an amount equal to the difference
between (1) the present value of the continuation of such benefits for 18
months and (2) the present value of the benefits the Executive will receive
under Paragraph 2(A)(i).





          (B) Notwithstanding the foregoing, or any other provision of the Agreement, for purposes of
determining the period of continuation coverage to which the Executive or any of Executive’s
dependents is entitled pursuant to Section 4980B of the Code under the Company’s medical, dental
and other group health plans, or successor plans, the Executive’s “qualifying event” will be the
termination of the Continuation Period and the Executive will be considered to have remained
actively employed on a full-time basis through that date, provided, however, that (1) with respect
to health benefits the continuation period will in all events terminate on the 18-month anniversary
of the termination date as so determined and (2) the Company will pay, or reimburse the Executive
for, all COBRA continuation costs during such period.




          (C) For purposes of the immediately preceding sentence and for purposes of calculating service
or age to determine the Executive’s eligibility for welfare benefits, including benefits under any
retiree medical benefits or life insurance plan or policy, the Executive will be considered to have
remained actively employed on a full-time basis through the termination of the Continuation Period.




          (D) For any Welfare Benefits that the Executive was receiving or entitled to receive
immediately prior to the Termination Date (or, if greater, immediately prior to the reduction,
termination, or denial described in Section 1(1)(5)) that are not considered to be “reimbursement
arrangements” covered under Section 1.409A-1(b)(9)(iv)(A) of the Code, the Company shall pay to the
Executive, within the time period described in Section 4(a), in a lump sum, an amount equal to the
present value of the continuation of such benefits for 18 months following the Termination Date.




          (E) Welfare Benefits otherwise receivable by the Executive pursuant to this Paragraph 2 will
be reduced to the extent comparable Welfare Benefits are actually received by the Executive from
another employer during the Continuation Period following the Executive’s Termination Date, and any
such Welfare Benefits actually received by the Executive will be reported by the Executive to the
Company.




     (3) The Non-Competition Period contemplated by Section 8(a) will be 12 months from the
Termination Date.




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