Exhibit 10.12


 


This
AMENDED AND RESTATED INDEMNIFICATION AGREEMENT, dated as of March 19, 2010
(this “Agreement”), is entered into by and among ServiceMaster Global
Holdings, Inc., a Delaware corporation (the “Company”), The
ServiceMaster Company, a Delaware corporation (“ServiceMaster” and,
together with the Company, the “Company Entities”), Banc of America
Capital Investors V, L.P. (the “Investor”), 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.  Capitalized terms used
herein without definition have the meanings set forth in Section 1 of this
Agreement.


 


RECITALS


 


A.            The Company is an acquisition vehicle
formed by Clayton, Dubilier & Rice, Inc. (“CD&R”) that
executed an Agreement and Plan of Merger, dated March 18, 2007 (as the
same may have been amended from time to time in accordance with its terms and
the Stockholders Agreement, the “Merger Agreement”), to acquire via
merger, on the terms and subject to the conditions set forth in the Merger
Agreement, all of the capital stock of ServiceMaster (such acquisition, the “Merger”).


 


B.            The Company and certain of its
stockholders entered into a Stockholders Agreement (as the same may be amended
from time to time in accordance with the terms thereof, the “Stockholders
Agreement”), dated as of July 24, 2007, setting forth certain
agreements with respect to, among other things, the management of the Company
and transfers of its shares in various circumstances.


 


C.            In connection with the Merger, each
Committing Investor (as defined in the Stockholders Agreement) entered into a
Commitment Letter (as defined in the Stockholders Agreement), pursuant to which
such Committing Investor agreed, subject to the conditions set forth therein,
to purchase stock of the Company for an aggregate purchase price equal to its
Commitment (as defined in the Commitment Letter).


 


D.            In order to finance the Merger and
related transactions, the Company sold shares of its common shares, par value
US$0.01 per share (“Shares”), to the Committing Investors, including the
Investor, and to certain co-investors and such other stockholders of the
Company as are listed in the signature pages of the Stockholders Agreement
or as otherwise became stockholders of the Company prior to the Merger pursuant
to the terms thereof (the “Equity Offering”).


 


E.             In order to finance the Merger, the
Company and/or one or more of its wholly-owned Subsidiaries entered into the
Debt Financing (as defined in the Merger Agreement).


 

















 


F.             The Company Entities, the Investor, the
Other Investors and the Investor Associates entered into an Indemnification
Agreement, dated as of July 24, 2007 (the “Original Indemnification
Agreement”), which is being amended and restated in its entirety as
provided in this Agreement.


 


G.            Concurrently with the execution and
delivery of the Original Indemnification Agreement, the Company and certain
other parties entered into a Transaction Fee Agreement with the Investor (or
one of its Affiliates), dated as of July 24, 2007 (the “Transaction Fee
Agreement”).


 


H.            Investor (or its Affiliates)  has performed the Initial Services (as defined in the
Transaction Fee Agreement) for the Company.


 


I.              The Company or one or more of its
Subsidiaries from time to time since the Acquisition has, and 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
Stockholders Agreement and any other applicable agreement.


 


J.             The parties hereto recognize the
possibility that claims might be made against and liabilities incurred by the
Investor, the Other Investors, Investor  Associates, or
related Persons or Affiliates under applicable securities laws or otherwise in
connection with the Transactions (including the Initial Services) or 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 Investor, the Other Investors, Investor Associates and related
Persons and Affiliates to be indemnified in respect of any such claims and liabilities.


 


K.            The parties hereto recognize that claims
might be made against and liabilities incurred by directors and officers of any
member of the Company Group in connection with their acting in such capacity,
and accordingly wish to provide for such directors and officers to be
indemnified to the fullest extent permitted by law in respect of any such
claims and liabilities.


 


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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 closing date of the Merger:


 


(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 then
outstanding voting securities, other than any such acquisition by any member of
the Company Group, any Committing Investors or their Affiliate Co-Investors (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


 


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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 “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.


 


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(i)            “Indemnitee” means each of the
Investor, the Other Investors, Investor  Associates,
their respective Affiliates, their respective successors and assigns, and the
respective directors, officers, partners, members, employees, agents, advisors,
consultants, representatives and controlling persons (within the meaning of the
Securities Act) of each of them, or of their 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)           “Investor Associates” means,
collectively, Banc of America Capital Management V, L.P., BACM I GP, LLC and BA
Equity Co-Invest GP LLC.


 


(l)            “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, arising or existing with respect to third parties or otherwise at any
time or from time to time.


 


(m)          “Other Investors” means,
collectively, BAS Capital Funding Corporation, BACSVM, L.P and Banc of America
Strategic Investments Corporation.


 


(n)           “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.


 


(o)           “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.


 


(p)           “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 


 


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standing or (ii) the
board of directors of the Company has determined that Shares otherwise have
become publicly-traded for this purpose.


 


(q)           “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 the
Transactions or 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 the Transactions or 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 the Transactions or 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 the Transactions or 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, the
Transactions 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 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.


 


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


 


(s)           “Securities Offerings” means the
Equity Offering, the offering by ServiceMaster of its 10.75%/11.50% Senior
Toggle Notes due 2015, any Management Offering, any Redemption and any
Subsequent Offering.


 


(t)            “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.


 


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(u)           “Transactions” means the Merger,
the Equity Offering and the Debt Financing.


 


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, the Debt Financing, any other
Transactions, 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, (C) the performance by the
Investor (or its Affiliates) of the Initial Services pursuant to the
Transaction Fee Agreement or (D) the performance by BAS Capital Funding
Corporation under its consulting agreement with the Company and ServiceMaster,
dated as of August 13, 2009 (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 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
any Indemnitee, pursuant to indemnification arrangements or otherwise, of any
Obligations contemplated in the foregoing clauses (A) or (B) of this
Section 2(a)(ii);


 


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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, the  Transaction
Fee 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 (including by any Investor Associates  or its Affiliates for all costs and Expenses incurred by
such Person) 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 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 


 


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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 the Transactions or 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 Transaction or 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 Transaction or 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 (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 Transaction or Securities Offering.


 


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(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
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 


 


10





















 


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 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 


 


11

















 


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 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 


 


12

















 


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.


 


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. 
Following the Transactions, each of the Company Entities, and each of
their corporate successors, shall implement and maintain 


 


13

















 


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. 
For the avoidance of doubt, this Agreement shall not cover or apply with
respect to any Indemnitee in its or its Affiliates’ capacity as (i) a
provider of Debt Financing (or as agents for the lenders thereunder) or in the
performance of services pursuant to (x) the Engagement Letter,
dated March 18, 2007, among CDRSVM Acquisition Co., Inc., Citigroup
Global Markets Inc., J.P. Morgan Securities Inc. and Banc of America Securities
LLC or (y) the Engagement Letter, dated April 9, 2007, among
CDRSVM Acquisition Co., Inc., Citigroup Global Markets Inc., J.P. Morgan
Securities Inc., Banc of America Securities LLC, Goldman, Sachs & Co.,
and Morgan Stanley & Co., Incorporation, it being understood that the
performance of such services will be subject to the separate indemnification
provisions of the Debt Financing and/or those engagement letters or (ii) a
provider of financial advisory services to the Company in connection with the
Merger pursuant to  the Engagement
Letter, dated as of December 15, 2006, between the Company and Banc of
America Securities LLC, as supplemented June 28, 2007.


 


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:  Greerson G. McMullen, Esq.


Facsimile:  (901) 597-8025


 


14

















 


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


 


Clayton, Dubilier & Rice, LLC


375 Park Avenue


18th Floor


New York, New York  10152


Attention: 
Mr. David H. Wasserman


Facsimile: 
(212) 893-7061


 


with a copy to (which shall
not constitute notice) each other Committing Investor.


 


(b)  If to any of the Investor, the Other
Investors or Investor Associates, to it at:


 


100 N. Tryon


Charlotte, North Carolina
28255


	
  Attention:

  	
  J. Chandler
  Martin

  
	
   

  	
  Scott R. Poole
  (25th Floor)

  



Facsimile:  (704) 386-6432


 


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


 


Kirkland &
Ellis LLP


Aon
Center


200
East Randolph Drive


Chicago,
Illinois 60601


Attention:  Christopher A. Ziebarth, Esq.


Facsimile:  (312) 861-2200


 


or to such other address or such other person as the Company Entities,
the Investor, the Other Investors or Investor Associates, 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:  Franci J. Blassberg, Esq.


Facsimile:  (212) 909-6836


 


15

















 


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 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.


 


16

















 


8.             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
extent such principles would require or permit the application of the laws of
another jurisdiction.


 


9.             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.


 


10.           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 Investor, the Other
Investors and their 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
Investor and the Other Investors.


 


11.           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 


 


17

















 


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 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.]


 


18

















 


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


 


	
   

  	
  BANC
  OF AMERICA CAPITAL INVESTORS V, L.P.

  
	
   

  	
   

  
	
   

  	
  By:
  Banc of America Capital

  
	
   

  	
  Management
  V, L.P., its General Partner

  
	
   

  	
   

  
	
   

  	
  By:
  BACM I GP, LLC, its General Partner

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ George E.
  Morgan, III

  
	
   

  	
   

  	
  Name: George E.
  Morgan, III

  
	
   

  	
   

  	
  Title: Authorized
  Person

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  BAS CAPITAL FUNDING
  CORPORATION

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ George E.
  Morgan, III

  
	
   

  	
   

  	
  Name: George E.
  Morgan, III

  
	
   

  	
   

  	
  Title: Authorized
  Person

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  BACSVM, L.P.

  
	
   

  	
   

  	
   

  
	
   

  	
  By: BA Equity Co-Invest
  GP, LLC, its General Partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ George E.
  Morgan, III

  
	
   

  	
   

  	
  Name: George E.
  Morgan, III

  
	
   

  	
   

  	
  Title: Authorized
  Person

  



 

















 


	
   

  	
  BANC OF AMERICA
  STRATEGIC INVESTMENTS CORPORATION

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ George E.
  Morgan, III

  
	
   

  	
   

  	
  Name: George E.
  Morgan, III

  
	
   

  	
   

  	
  Title: Authorized
  Person

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  BANC OF AMERICA
  CAPITAL MANAGEMENT V, L.P.

  
	
   

  	
   

  	
   

  
	
   

  	
  By: BACM I GP,
  LLC, its General Partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/ George E.
  Morgan, III

  
	
   

  	
   

  	
  Name: George E.
  Morgan, III

  
	
   

  	
   

  	
  Title: Authorized
  Person

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  BACM I GP, LLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ George E.
  Morgan, III

  
	
   

  	
   

  	
  Name: George E.
  Morgan, III

  
	
   

  	
   

  	
  Title: Authorized
  Person

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  BA EQUITY CO-INVEST GP
  LLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ George E.
  Morgan, III

  
	
   

  	
   

  	
  Name: George E.
  Morgan, III

  
	
   

  	
   

  	
  Title: Authorized
  Person

  



 

















 


	
   

  	
  SERVICEMASTER GLOBAL
  HOLDINGS, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Steven J. Martin

  
	
   

  	
   

  	
  Name: Steven J. Martin

  
	
   

  	
   

  	
  Title: Vice
  President & Chief Financial Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  THE SERVICEMASTER
  COMPANY

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Steven J. Martin

  
	
   

  	
   

  	
  Name: Steven J. Martin

  
	
   

  	
   

  	
  Title: Senior Vice President & Chief
  Financial Officer