Document:

Exhibit 10.59

 

Director Stock Subscription Agreement

 

This Director Stock Subscription Agreement, dated as of December 11, 2013, between ServiceMaster Global Holdings, Inc., a Delaware corporation, and the Director whose name appears on the signature page hereof, is being entered into pursuant to the ServiceMaster Global Holdings, Inc. Stock Incentive Plan.  The meaning of each capitalized term may be found in Section 10.

 

The Company and the Director hereby agree as follows:

 

Section 1.                           Purchase and Sale of Common Stock.

 

(a)                      In General.  Subject to all of the terms of this Agreement, at the Closing the Director shall purchase, and the Company shall sell, the aggregate number of shares of Common Stock set forth on the signature page hereof (the “Shares”), at the purchase price set forth on the signature page hereof.

 

(b)                      Condition to Sale.  Notwithstanding anything in this Agreement to the contrary, the Company shall have no obligation to sell any Common Stock to any person who is not a member of the Board at the time that such shares of Common Stock are to be sold or who is a resident of a jurisdiction in which the sale of Common Stock to him would constitute a violation of the securities, “blue sky” or other laws of such jurisdiction.

 

Section 2.                           The Closing.

 

(a)                      Time and Place.  The Company shall determine the time and place of the closing of the purchase and sale of the Shares (the “Closing”).

 

(b)                      Delivery by the Director.  At the Closing, the Director shall deliver to the Company the aggregate purchase price for the Shares.

 

(c)                       Delivery by the Company.  At the Closing, the Company shall register the Shares in the name of the Director.  If the Shares are 

 

 

certificated, any certificates relating to the Shares shall be held by the Secretary of the Company or his designee on behalf of the Director.

 

Section 3.                           Director’s Representations and Warranties.

 

(a)                      Access to Information, Etc.  The Director represents, warrants and covenants as follows:

 

(i)                        the Director has carefully reviewed the materials furnished to the Director in connection with the offer and sale of the Shares pursuant to this Agreement;

 

(ii)                     the Director has had an adequate opportunity to consider whether or not to purchase any of the shares of Common Stock offered to the Director, and to discuss such purchase with the Director’s legal, tax and financial advisors;

 

(iii)                  the Director understands the terms and conditions that apply to the Shares and the risks associated with an investment in the Shares;

 

(iv)                 the Director has a good understanding of the English language;

 

(v)                    the Director is, and will be at the Closing, a member of the Board; and

 

(vi)                 the Director is, and will be at the Closing, a resident of the jurisdiction indicated as his or her address set forth on the signature page of this Agreement.

 

(b)                      Ability to Bear Risk.  The Director represents and warrants as follows:

 

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(i)                        the Director understands that the rights of first refusal and other transfer restrictions that apply to the Shares may effectively preclude the transfer of any of the Shares prior to a Public Offering;

 

(ii)                     the financial situation of the Director is such that he or she can afford to bear the economic risk of holding the Shares for an indefinite period;

 

(iii)                  the Director can afford to suffer the complete loss of his or her investment in the Shares; and

 

(iv)                 the Director understands that the Company’s Financing Agreements may restrict the ability of the Company to repurchase the Shares pursuant to Section 5 and that the Company and its Subsidiaries may enter into or amend, refinance or enter into new Financing Agreements without regard to the impact on the Company’s ability to repurchase the Shares.

 

(c)                       Voluntary Purchase.  The Director represents and warrants that the Director is purchasing the Shares voluntarily.

 

(d)                      No Right to Awards.  The Director acknowledges and agrees that the sale of the Shares (i) is being made on an exceptional basis and are not intended to be renewed or repeated, (ii) is entirely voluntary on the part of the Company and its Subsidiaries and (iii) should not be construed as creating any obligation on the part of the Company or any of its Subsidiaries to offer any securities in the future.

 

(e)                       Investment Intention.  The Director represents and warrants that the Director is acquiring the Shares solely for his or her own account for investment and not on behalf of any other person or with a view to, or for sale in connection with, any distribution of the Shares.

 

(f)                        Securities Law Matters.  The Director acknowledges and represents and warrants that the Director understands that:

 

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(i)                        the Shares have not been registered under the Securities Act or any state or non-United States securities or “blue sky” laws;

 

(ii)                     it is not anticipated that there will be any public market for the Shares;

 

(iii)                  the Shares must be held indefinitely and the Director must continue to bear the economic risk of the investment in the Shares unless the Shares are subsequently registered under applicable securities and other laws or an exemption from registration is available;

 

(iv)                 the Company is under no obligation to register the Shares or to make an exemption from registration available; and

 

(v)                    a restrictive legend shall be placed on any certificates representing the Shares that makes clear that the Shares are subject to the restrictions on transferability set forth in this Agreement and a notation shall be made in the appropriate records of the Company or any transfer agent indicating that the Shares are subject to such restrictions.

 

(g)                       Voting Proxy.  By entering into this Agreement and purchasing the Shares, the Director hereby irrevocably grants to and appoints the CD&R Investors collectively (to act by unanimous consent) as such Director’s proxy and attorney-in-fact (with full power of substitution), for and in the name, place and stead of such Director, to vote or act by unanimous written consent with respect to such Director’s Shares.  The Director hereby affirms that the irrevocable proxy set forth in this Section 3(g) will be valid until the consummation of a Public Offering and is given to secure the performance of the obligations of such Director under this Agreement.  The Director hereby further affirms that the proxy hereby granted shall be irrevocable and shall be deemed coupled with an interest and shall extend for the term of this Agreement, or, if earlier, until the last date permitted by law.  For the avoidance of doubt, except as expressly contemplated by this Section 3(g), the Director has not granted a proxy to any Person to exercise the rights of such Director under this Agreement or any other agreement relating to the Shares to which such Director is a party.

 

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Section 4.                       Restriction on Transfer of Shares.

 

(a)                      In General.  Prior to the first to occur of a Public Offering and the third anniversary of the Closing, the Director shall not Transfer any of the Shares other than (i) upon the Director’s death by will or by the laws of descent and distribution, (ii) repurchases by the Company (or an assignee thereof) or the CD&R Investors pursuant to Section 5 hereof, (iii) pursuant to Section 6 or Section 7 hereof, or (iv) with the Company’s consent.  Shares may only be Transferred in a manner that complies with all applicable securities laws and, if the Company so requests, prior to any attempted Transfer, the Director shall provide to the Company at the Director’s expense such information relating to the compliance of such proposed Transfer with the terms of this Agreement and applicable securities laws as the Company shall reasonably request, which may include an opinion in form and substance reasonably satisfactory to the Company of counsel regarding such securities law or other matters as the Company shall request (such counsel to be reasonably satisfactory to the Company).

 

(b)                      No Transfer That Would Result In Registration Requirements.  Prior to a Public Offering, the Shares may not be Transferred if such Transfer would result in the Company becoming subject to the reporting requirements of Section 13 or 15(d) of the Exchange Act (or other similar provision of non-U.S. law) or would increase the risk that the Company would be subject to such reporting requirements as determined by the Company in its sole and absolute discretion.  Any purported Transfer in violation of Section 4(a) or this Section 4(b) shall be void ab initio.

 

Section 5.                           Options Effective on Termination of Employment Prior to a Public Offering.

 

(a)                      Rights of the Company and the Initial Investors.  If the Director’s employment with the Company terminates for any reason prior to a Public Offering, the Company may elect to purchase all or a portion of the Shares by written notice to the Director delivered on or before the 60th day after the Director’s termination of employment (the “First Option Period”).  The CD&R Investors may elect to purchase all or any portion of the Shares that the Company has not elected to purchase by written notice to the Director delivered at any time on or before the 80th day after the Director’s termination of employment (the “Second Option Period”).

 

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(b)                      Limited Right of the Director to Require the Company to Repurchase Shares.  If the Director’s employment with the Company is terminated prior to a Public Offering by the Director upon Retirement or by reason of the Disability or death of the Director or is terminated by the Company without Cause, the Director may require the Company to purchase all (but not less than all) of an Director’s Shares (excluding any Shares acquired on exercise of an Option) by written notice delivered to the Company within 30 days following the expiration of the Second Option Period.

 

(c)                       Purchase Price.  The purchase price per Share pursuant to this Section 5 shall equal the Fair Market Value as of the later of (i) the effective date of the Director’s termination of employment and (ii) six months and one day from the date of the Director’s acquisition of the Shares pursuant to this Agreement (such date, the “Determination Date”), provided that if the Director’s employment is terminated by the Company for Cause, the purchase price per Share shall equal the lesser of (i) the Fair Market Value of such Share as of the Determination Date and (ii) the price at which the Director purchased such Share from the Company pursuant to this Agreement.

 

(d)                      Closing of Purchase; Payment of Purchase Price.  Subject to Section 5(f), the closing of a purchase pursuant to this Section 5 shall take place at the principal office of the Company no later than the 90th day following the Determination Date (or, in the case of a purchase pursuant to Section 5(b), no later than 10 business days following the Company’s receipt of written notice from the Director pursuant to Section 5(b)).  At the closing, (i) the Company or the CD&R Investors, as the case may be, shall, subject to Section 5(e), pay the Purchase Price to the Director and (ii) if the Director actually holds any certificates or other instruments representing the Shares so purchased, the Director shall deliver to the Company such certificates or other instruments, appropriately endorsed by the Director or directing that the shares be so transferred to the purchaser thereof, as the Company may reasonably require.

 

(e)                       Application of the Purchase Price to Certain Loans or Other Obligations.  The Company shall be entitled to apply any amounts otherwise payable pursuant to this Section 5 to discharge any indebtedness of the Director to the Company or any of its Subsidiaries or indebtedness that is guaranteed by the Company or any of its Subsidiaries or to offset

 

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any such amounts against any other obligations of the Director to the Company or any of its Subsidiaries.

 

(f)                        Certain Restrictions on Repurchases; Delay of Repurchase.  Notwithstanding any other provision of this Agreement, the Company shall not be permitted or obligated to make any payment with respect to a repurchase of any Shares from the Director if (i) such repurchase (or the payment of a dividend by a Subsidiary to the Company to fund such repurchase) would result in a violation of the terms or provisions of, or result in a default or an event of default under, any guaranty, financing or security agreement or document entered into by the Company or any Subsidiary from time to time (the “Financing Agreements”), (ii) such repurchase would violate any of the terms or provisions of the Certificate of Incorporation and By-laws of the Company or (iii) the Company has no funds legally available to make such payment under the General Corporation Law of the State of Delaware.  If payment with respect to a repurchase by the Company otherwise permitted or required under this Section 5 is prevented by the terms of the preceding sentence: (i) the payment of the applicable Purchase Price shall be postponed and will take place at the first opportunity thereafter when the Company has funds legally available to make such payment and when such payment will not result in any default, event of default or violation under any of the Financing Agreements or in a violation of any term or provision of the Certificate of Incorporation or By-laws, (ii) such repurchase obligation shall rank against other similar repurchase obligations with respect to Common Stock according to priority in time of the effective date of the termination of employment giving rise to such repurchase (provided that any repurchase commitment arising from Disability or death shall have priority over any other repurchase obligation) and (iii) the Purchase Price, except in the case of a termination for Cause, shall be increased by an amount equal to interest on such Purchase Price for the period during which payment is delayed at an annual rate equal to the weighted average cost of the Company’s senior secured bank indebtedness outstanding during the delay period.

 

(g)                       Right to Retain Shares.  If the options of the Company and the CD&R Investors to purchase the Shares pursuant to this Section 5 are not exercised with respect to all of the Shares, the Director shall be entitled to retain the remaining Shares, although those Shares shall remain subject to all of the other provisions of this Agreement.

 

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(h)                      Notice of Termination; Etc.  Prior to a Public Offering, the Company shall give prompt written notice to the CD&R Investors of any termination of the Director’s employment with the Company and of the Company decision whether or not to purchase Shares pursuant to Section 5(a).

 

(i)                          Public Offering.  The provisions of this Section 5 shall terminate upon a Public Offering, provided that such termination shall not affect the Company’s repurchase right following a termination for Cause that was effective (or deemed to be effective) prior to such Public Offering or any payment obligation postponed pursuant to Section 5(f).

 

(j)                         Allocation of Purchase Rights.  The Director acknowledges and agrees that the CD&R Investors may allocate and assign their purchase rights under this Section 5, as among themselves and the other Investors, in such manner as they, in their sole discretion, may agree from time to time.

 

(k)                      Employment References.  For purpose of this Agreement, references herein to “employ,” “employment” and corollary terms shall be construed to refer to the Director’s provision of services to the Company as an executive or non-executive member of the Board.

 

Section 6.                           “Tag-Along” Rights.

 

(a)                      Sale Notice.  At least 30 days before any of the Investors (whether acting alone or jointly with one or more of the other Investors) consummates a sale of more than 50.01% of the Common Stock collectively owned by the Investors as of the Effective Date to a Third-Party Buyer, the Company will deliver a written notice (the “Sale Notice”) to the Director.  The Sale Notice will disclose the material terms and conditions of the proposed sale or transfer, including the number of shares of Common Stock that the prospective transferee is willing to purchase, the proposed purchase price per share and the intended consummation date of such sale.

 

(b)                      Right to Participate.  The Director may elect to participate in the sale or other transfer described in the Sale Notice by giving written notice to the applicable Investors and the Company within 15 days after the Company has given the related Sale Notice to the Director.  If the Director 

 

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elects to participate, the Director will be entitled to sell in the contemplated transaction, at the same price and on the same terms and conditions as set forth in the Sale Notice, an amount of Shares equal to the product of (i) the quotient determined by dividing (A) the percentage of the Company’s then outstanding Common Stock represented by the Shares then held by the Director by (B) the aggregate percentage of the Company’s then outstanding Common Stock represented by the Common Stock then held by the Investor(s) participating in the sale or other transfer described in the Sale Notice and all holders of Common Stock electing to participate in such sale and (ii) the number of Common Stock the prospective transferee has agreed to purchase in the contemplated transaction.

 

(c)                       Certain Matters Relating to the Investors.  The Company will use its commercially reasonable best efforts to cause the Investors to conduct any sale that is within the scope of this Section 6 in a manner consistent with this Section 6.  If the Company is not able to do so or fails to give the Sale Notice to the Director as prescribed in Section 6(a), the Director’s sole remedy shall be against the Company.

 

(d)                      Expiration Upon a Public Offering.  The provisions of this Section 6 shall terminate upon the consummation of a Public Offering.

 

Section 7.                           “Drag-Along” Rights.

 

(a)                      Drag-Along Notice.  If any of the Investors (whether acting alone or jointly with one or more of the other Investors) intends to sell or otherwise Transfer, or enter into an agreement to sell or otherwise Transfer, for cash or other consideration, more than 50.01% of the Common Stock collectively owned by the Investors as of the Effective Date to a Third-Party Buyer and the applicable Investor(s) elects to exercise its rights under this Section 7, the Company shall deliver written notice (a “Drag-Along Notice”) to the Director, which notice shall state (i) that the Investor(s) wishes to exercise its rights under this Section 7 with respect to such sale, (ii) the name and address of the Third-Party Buyer, (iii) the per share amount and form of consideration the applicable Investor(s) proposes to receive for its Common Stock, (iv) the material terms and conditions of payment of such consideration and all other material terms and conditions of such sale, and (v) the anticipated time and place of the closing of the purchase and sale (a “Drag-Along Closing”).

 

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(b)                      Conditions to Drag-Along.  Upon delivery of a Drag-Along Notice, the Director shall have the obligation to sell and transfer to the Third-Party Buyer at the Drag-Along Closing the percentage of the Director’s Shares equal to the percentage of the Common Stock owned by the Investor(s) that are to be sold to the Third-Party Buyer (the “Applicable Percentage”) on the same terms as the applicable Investor(s), but only if such Investor(s) sells and transfers the Applicable Percentage of the Investor’s (Investors’) Common Stock to the Third-Party Buyer at the Drag-Along Closing.

 

(c)                       Power of Attorney, Custodian, Etc.  By entering into this Agreement and purchasing the Shares, the Director hereby appoints the applicable Investor(s) and any Affiliates of such Investor(s) so designated by the Investor(s) the Director’s true and lawful attorney-in-fact and custodian, with full power of substitution (the “Custodian”), and authorizes the Custodian to take such actions as the Custodian may deem necessary or appropriate to effect the sale and transfer of the Applicable Percentage of the Director’s Shares to the Third-Party Buyer, upon receipt of the purchase price therefor at the Drag-Along Closing, free and clear of all security interests, liens, claims, encumbrances, charges, options, restrictions on transfer, proxies and voting and other agreements of whatever nature, and to take such other action as may be necessary or appropriate in connection with such sale or transfer, including consenting to any amendments, waivers, modifications or supplements to the terms of the sale (provided that the applicable Investor also so consents, and, to the extent applicable, sells and transfers the Applicable Percentage of its Common Stock on the same terms as so amended, waived, modified or supplemented) and instructs the Secretary of the Company (or other person holding any certificates for the Shares) to deliver to the Custodian certificates representing the Applicable Percentage of the Director’s Shares, together with all necessary duly-executed stock powers.  If so requested by the applicable Investor(s) or the Company, the Director will confirm the preceding sentence in writing in form and substance reasonably satisfactory to such Investor promptly upon receipt of a Drag-Along Notice (and in any event no later than 10 days after receipt of the Drag-Along Notice).  Promptly after the Drag-Along Closing, the Custodian shall give notice thereof to the Director and shall remit to the Director the net proceeds of such sale (reduced by any amount required to be held in escrow pursuant to the terms of the purchase and sale agreement and any other expenses).

 

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(d)                      The Investors are Third-Party Beneficiaries; Remedies.  The Director acknowledges and agrees that any of the Investors that takes action pursuant to this Section 7 is an intended third-party beneficiary of this Section 7, as if such Investor were a party to this Agreement directly.  Following a breach or a threatened breach by the Director of the provisions of this Section 7, the applicable Investor may obtain an injunction granting it specific performance of the Director’s obligations under this Section 7.  Whether or not the applicable Investor obtains such an injunction, and whether or not the transaction with respect to which the Drag-Along Notice relates is consummated, following such a breach or threatened breach by the Director the Company shall have the option to purchase any or all of the Director’s Shares at a purchase price per Share equal to the lesser of the price at which the Director purchased such Shares from the Company or the per share consideration payable pursuant to the Drag-Along Offer.  The preceding sentence shall not limit the Company’s or the Investors’ rights to recover damages (or the amount thereof) from the Director.

 

(e)                       Expiration on a Public Market.  The provisions of this Section 7 shall terminate and cease to have further effect upon the establishment of the Public Market, provided that such termination shall not affect any right to receive or seek damages or purchase Shares pursuant to Section 7(d).

 

Section 8.                           Rights of First Refusal.

 

(a)                      Notice.  At any time prior to a Public Offering, in addition to the Transfer restrictions set forth in Section 4 and except as otherwise expressly provided in this Agreement, the Director may not Transfer any Shares other than pursuant to a Qualified Offer and if the Director desires to accept a Qualified Offer, the Director shall first give at least 60 days’ prior written notice to the Company and the CD&R Investors:

 

(i)                        designating the number of Shares proposed to be Transferred (the “Offered Shares”);

 

(ii)                     naming the prospective acquiror of such Shares; and

 

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(iii)                  specifying the price at (the “Offer Price”) and terms upon which (the “Offer Terms”) the Director desires to Transfer such Shares.

 

(b)                      Right of the Company. During the 30-day period following the Company’s receipt of the Director’s notice pursuant to Section 8(a) (the “First Refusal Period”), the Company shall have the right to purchase from the Director all or any portion of the Offered Shares, at the Offer Price and on the Offer Terms, and any such purchase shall be settled at the time and in the manner specified in Section 8(d) hereof.  The Company shall use its reasonable efforts to act as promptly as practicable following receipt of the notice from the Director to determine whether it shall elect to exercise such right.

 

(c)                       Right of the CD&R Investors.  If the Company determines within the First Refusal Period that it does not wish to exercise its right to purchase all of the Offered Shares, the CD&R Investors shall have the right to purchase all or any portion remaining of the Offered Shares specified in such notice, at the Offer Price and on the Offer Terms, and any such purchase shall be settled at the time and in the manner specified in Section 8(d) hereof.  The CD&R Investors must determine whether to exercise such right during the period beginning on the earlier of (x) the end of the First Refusal Period and (y) the date of receipt by the CD&R Investors of written notice that the Company has elected not to exercise its rights under Section 8(b) and ending 60 days after the CD&R Investors’ receipt of the Director’s notice pursuant to Section 8(a) (the “Second Refusal Period”).

 

(d)                      Manner of Exercise.  The rights provided hereunder shall be exercised by written notice to the Director given at any time during the applicable period.  If such right is exercised, the Director may not sell pursuant to the Qualified Offer any of the Shares that the Company or the CD&R Investors have elected to purchase and the Company or the CD&R Investors, as the case may be, shall deliver to the Director cash, check or other readily-available funds for the Offer Price, against delivery of certificates or other instruments representing the Shares so purchased, appropriately endorsed by the Director, and free and clear of all security interests, liens, claims, encumbrances, charges, etc.  Notwithstanding the foregoing, neither the Company nor the CD&R Investors, as the case may be, shall deliver any cash, check or other readily-available funds for the Offer Price to the Director prior to the date which is six months and one 

 

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day from the date of the Director’s acquisition of the Shares pursuant to this Agreement.

 

(e)                       Additional Requirements for Sale.  Subject to Section 4, if neither the Company nor the CD&R Investors shall have exercised its rights under this Section 8, then the Director may Transfer the Offered Shares to (but only to) the intended purchaser named in his notice to the Company and the CD&R Investors at the Offer Price and on the Offer Terms; provided that:

 

(i)                        such Transfer must be consummated within 30 days following the expiration of the Second Refusal Period; and

 

(ii)                     the intended purchaser must first agree in writing in form and substance satisfactory to the Company to make and be bound by the representations and warranties set forth in Section 3(b), Section 3(e) and Section 3(f) and to agree to and be bound by the covenants and other restrictions set forth in this Agreement (including, but not limited to, Section 3(g), Section 4, Section 6, Section 7, Section 8, Section 9 and Section 11) and such other covenants or restrictions as the Company shall reasonably request (it being understood that the Director and any intended purchaser therefrom shall not have any of the benefits provided for in Section 5).

 

Any purported Transfer in violation of this Section 8 shall be void ab initio.

 

(f)                        Allocation by CD&R Investors.  The Director acknowledges and agrees that the CD&R Investors may allocate and assign their rights to purchase any or all of the Offered Shares within the Second Refusal Period, as among themselves and the other Investors, in such manner as they, in their sole discretion, may agree from time to time.

 

Section 9.                           Holdback Agreements.  If the Company files a registration statement under the Securities Act with respect to an underwritten public offering of any shares of its capital stock, the Director shall not effect any public sale (including a sale under Rule 144 under the Securities Act or other similar provision of applicable law) or distribution of any Common Stock, other than as part of such underwritten public offering, during the 20 days prior to and the 180 

 

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days after the effective date of such registration statement (or such other period as may be generally applicable to or agreed by the Company’s senior-most executives).  If the Company files a prospectus in connection with a takedown from a shelf registration statement, the Director shall not effect any public sale (including a sale under Rule 144 under the Securities Act or other similar provision of applicable law) or distribution of any Common Stock, other than as part of such offering, for 20 days prior to and 90 days after the date the prospectus supplement is filed with the Securities and Exchange Commission (or such other period as may be generally applicable to or agreed by the Company’s senior-most executives).

 

Section 10.                    Certain Definitions.

 

(a)                      Capitalized terms not otherwise defined in this Agreement have the meanings given to them in the ServiceMaster Global Holdings, Inc. Stock Incentive Plan.

 

(b)                      As used in this Agreement, the following terms shall have the meanings set forth below:

 

“Agreement” means this Director Stock Subscription Agreement, as amended from time to time in accordance with the terms hereof.

 

“Applicable Percentage” has the meaning given in Section 7(b).

 

“Closing” has the meaning given in Section 2(a).

 

“Custodian” has the meaning given in Section 7(c).

 

“Determination Date” has the meaning given in Section 5(c).

 

“Drag-Along Closing” has the meaning given in Section 7(a).

 

“Drag-Along Notice” has the meaning given in Section 7(a).

 

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“Director” means the purchaser of the Shares whose name is set forth on the signature page of this Agreement; provided that following such person’s death, the “Director” shall be deemed to include such person’s beneficiary or estate and following such person’s Disability, the “Director” shall be deemed to include any legal representative of such person.

 

“Exchange Act” means the United States Securities Exchange Act of 1934, as amended, or any successor statute, and the rules and regulations thereunder that are in effect at the time, and any reference to a particular section thereof shall include a reference to the corresponding section, if any, of any such successor statute, and the rules and regulations thereunder.

 

“Financing Agreements” has the meaning given in Section 5(f).

 

“First Option Period” has the meaning given in Section 5(a).

 

“First Refusal Period” has the meaning given in Section 8(b).

 

“Offer Price” has the meaning given in Section 8(a).

 

“Offer Terms” has the meaning given in Section 8(a).

 

“Offered Shares” has the meaning given in Section 8(a).

 

“Person” means any natural person, firm, partnership, limited liability company, association, corporation, company, trust, business trust, governmental authority or other entity.

 

“Public Market” shall be deemed to have been established at such time as 30% of the Common Stock (on a fully diluted basis) has been sold to the public pursuant to an effective registration statement under the Securities Act, pursuant to Rule 144 or pursuant to a public offering outside the United States.

 

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“Purchase Price” means the purchase price per Share determined in accordance with Section 5(c).

 

“Qualified Offer” means an offer to purchase Shares from a single purchaser and which must be in writing and for cash or other immediately-available funds, be irrevocable by its terms for at least 60 days and be a bona fide offer as determined in good faith by the Board or the Compensation Committee thereof.

 

“Retirement” means the Director’s retirement from active service on or after the Director reaches normal retirement age.

 

“Rule 144” means Rule 144 under the Securities Act (or any successor provision thereto).

 

“Sale Notice” has the meaning given in Section 6(a).

 

“Second Option Period” has the meaning given in Section 5(a).

 

“Second Refusal Period” has the meaning given in Section 8(c).

 

“Securities Act” means the United States Securities Act of 1933, as amended, or any successor statute, and the rules and regulations thereunder that are in effect at the time and any reference to a particular section thereof shall include a reference to the corresponding section, if any, of any such successor statute, and the rules and regulations thereunder.

 

“Shares” has the meaning given in Section 1(a), and for purposes of Section 3(g), Section 4, Section 5, Section 6, Section 7, Section 8, and Section 9 it also includes Common Stock delivered as dividends in respect of the Shares.

 

“Stock Incentive Plan” means the ServiceMaster Global Holdings, Inc. Stock Incentive Plan adopted by the Board, as amended from time to time.

 

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“Third-Party Buyer” means any Person other than (i) the Company or any of its Subsidiaries, (ii) any employee benefit plan of the Company or any of its Subsidiaries, (iii) the Investors or (iv) any Affiliates of any of the foregoing.

 

“Transfer” means any sale, assignment, transfer, pledge, encumbrance, or other direct or indirect disposition (including a hedge or other derivative transaction).

 

Section 11.                    Miscellaneous.

 

(a)                      Authorization to Share Personal Data.  The Director authorizes any Affiliate of the Company that employs the Director or that otherwise has or lawfully obtains personal data relating to the Director to divulge or transfer such personal data to the Company or to a third party, in each case in any jurisdiction, if and to the extent appropriate in connection with this Agreement or the administration of the Plan.

 

(b)                      Unforeseen Personal Hardship.  If the Director, prior to a Public Offering and still in the employment of the Company, experiences financial hardship arising from (i) extraordinary medical expenses or other expenses directly related to illness or disability of the Director, a member of the Director’s immediate family or one of the Director’s parents or (ii) payments necessary or required to prevent the eviction of the Director from the Director’s principal residence or foreclosure on the mortgage on that residence, the Board will carefully consider any request by the Director that the Company repurchase the Director’s Shares at the Purchase Price, but the Company shall have no obligation to do so.

 

(c)                       Notices.  All notices and other communications required or permitted to be given under this Agreement shall be in writing and shall be deemed to have been given if delivered personally or sent by certified or express mail, return receipt requested, postage prepaid, or by any recognized international equivalent of such delivery, to the Company, any of the Investors or the Director, as the case may be, at the following addresses or to such other address as the Company, the Investors or the Director, as the case may be, shall specify by notice to the others:

 

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(i)                        if to the Company, to it at:

 

ServiceMaster Global Holdings, Inc.
 c/o The ServiceMaster Company

860 Ridge Lake Boulevard
 Memphis, Tennessee  38120

 

Attention: General Counsel

Fax: (901) 597-8025

 

with copies (which shall not constitute notice) to the Persons listed in clause (iv) below);

 

(ii)                     if to the Director, to the Director at his or her most recent address as shown on the books and records of the Company or Subsidiary employing the Director;

 

(iii)                  if to any Investor, to the Persons listed in clause (iv) below;

 

(iv)                 copies of any notice or other communication given under this Agreement shall also be given to:

 

Clayton, Dubilier & Rice, LLC
 375 Park Avenue, 18th Floor
 New York, New York 10152
  Attention:  David Wasserman
 Fax: (212) 893-7061

 

and

 

Debevoise & Plimpton LLP
 919 Third Avenue 
 New York, New York 10022

Attention:  John M. Allen
 Fax:  (212) 909-6836

 

All such notices and communications shall be deemed to have been received on the date of delivery if delivered personally or on the third business day after the mailing thereof.

 

18

 

(d)                      Binding Effect; Benefits.  This Agreement shall be binding upon and inure to the benefit of the parties to this Agreement and their respective successors and assigns.  Except as otherwise provided herein with respect to the Investors, nothing in this Agreement, express or implied, is intended or shall be construed to give any person other than the parties to this Agreement or their respective successors or assigns any legal or equitable right, remedy or claim under or in respect of any agreement or any provision contained herein.

 

(e)                       Waiver; Amendment.

 

(i)                        Waiver.  Any party hereto may by written notice to the other parties (A) extend the time for the performance of any of the obligations or other actions of the other parties under this Agreement, (B) waive compliance with any of the conditions or covenants of the other parties contained in this Agreement, and (C) waive or modify performance of any of the obligations of the other parties under this Agreement; provided that any waiver of the provisions of Section 4 through and including Section 9 or this Section 11(e) must be consented to in writing by the CD&R Investors.  Except as provided in the preceding sentence, no action taken pursuant to this Agreement, including, but not limited to, any investigation by or on behalf of any party, shall be deemed to constitute a waiver by the party taking such action of compliance with any representations, warranties, covenants or agreements contained herein.  The waiver by any party hereto of a breach of any provision of this Agreement shall not operate or be construed as a waiver of any preceding or succeeding breach and no failure by a party to exercise any right or privilege hereunder shall be deemed a waiver of such party’s rights or privileges hereunder or shall be deemed a waiver of such party’s rights to exercise the same at any subsequent time or times hereunder.

 

(ii)                     Amendment.  This Agreement may be amended, modified or supplemented only by a written instrument executed by the Director and the Company; provided that the provisions of Section 4 through Section 9 and this Section 11 may be amended by the Company with the vote of a majority (by number of shares of Common Stock) of the employees and directors who hold Common Stock purchased pursuant to a stock subscription agreement having 

 

19

 

comparable provisions; provided, further, that any amendment adversely affecting the rights of the CD&R Investors hereunder must be consented to by the CD&R Investors.

 

(f)                        Assignability.  Neither this Agreement nor any right, remedy, obligation or liability arising hereunder or by reason hereof shall be assignable by the Company or the Director without the prior written consent of the other parties, provided that the CD&R Investors may assign from time to time all or any portion of their respective rights under this Agreement, to one or more persons or other entities designated by each of them.

 

(g)                       Applicable Law.  This Agreement shall be governed by and construed in accordance with the law of the State of Delaware regardless of the application of rules of conflict of law that would apply the laws of any other jurisdiction.

 

(h)                      Waiver of Jury Trial.  Each party hereby waives, to the fullest extent permitted by applicable law, any right it may have to a trial by jury in respect of any suit, action or proceeding arising out of this Agreement or any transaction contemplated hereby.  Each party (i) certifies that no representative, agent or attorney of any other party has represented, expressly or otherwise, that such other party would not, in the event of litigation, seek to enforce the foregoing waiver and (ii) acknowledges that it and the other parties have been induced to enter into the Agreement by, among other things, the mutual waivers and certifications in this Section 11(h).

 

(i)                          Section and Other Headings, etc.  The section and other headings contained in this Agreement are for reference purposes only and shall not affect the meaning or interpretation of this Agreement.

 

(j)                         Counterparts.  This Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original and all of which together shall constitute one and the same instrument.

 

20

 

IN WITNESS WHEREOF, the Company and the Director have executed this Agreement as of the date first above written.

 

 

	
 
    	
SERVICEMASTER GLOBAL HOLDINGS, INC.
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By: 
    	
/s/ James T. Lucke
    
	
 
    	
Name: 
    	
James T. Lucke
    
	
 
    	
Title: 
    	
Vice President, General Counsel & Secretary
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
THE DIRECTOR:
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
/s/ John Krenicki, Jr.
    
	
 
    	
John Krenicki, Jr.
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
Address of the Director:
    
	
 
    	
 
    
	
 
    	
XXXXX
    
	
 
    	
XXXXX, MA 01254
    
				

 

	
Total Number of Shares
    	
 
    
	
of Common Stock
    	
 
    
	
to be Purchased:
    	
95,238
    
	
 
    	
 
    
	
Per Share Price:
    	
$10.50
    
	
 
    	
 
    
	
Total Purchase
    	
 
    
	
Price:
    	
$999,999.00
    

 

21Exhibit 10.15

 

MYR GROUP INC.

 

RESTRICTED STOCK AWARD AGREEMENT

(Named Executive Officer)

 

This AGREEMENT (this “Agreement”) is made as of March 24, 2014 (the “Date of Grant”), by and between MYR Group Inc., a Delaware corporation (the “Company”), and [                         ] (“Grantee”).

 

1.                                      Grant of Restricted Stock.  Pursuant to the MYR Group Inc. 2007 Long-Term Incentive Plan (Amended and Restated as of May 5, 2011) (the “Plan”) and subject to the terms and conditions thereof and the terms and conditions hereinafter set forth, the Company hereby grants to Grantee [        ] shares of Common Stock (the “Restricted Stock”).

 

2.                                      Rights of Grantee.  The shares of Restricted Stock subject to this grant shall be fully paid and nonassessable and shall be either (a) represented by certificates held in custody by the Company until all restrictions thereon have lapsed, together with a stock power or powers executed by the Grantee in whose name such certificates are registered, endorsed in blank and covering such shares of Restricted Stock, or (b) held at the Company’s transfer agent in book entry form with appropriate restrictions relating to the transfer of such shares of Restricted Stock, and endorsed with an appropriate legend referring to the restrictions hereinafter set forth.  Grantee shall have all the rights of a stockholder with respect to such shares, including the right to vote the shares and receive all dividends and other distributions paid or made with respect thereto; provided, however, that dividends or other distributions on the Restricted Stock will be deferred until and paid contingent upon the vesting of such Restricted Stock.

 

3.                                      Restrictions on Transfer of Shares of Restricted Stock.  The shares of Restricted Stock may not be transferred, assigned or subject to any encumbrance, pledge or charge, until the shares of Restricted Stock have vested as provided in Sections 4 and 5 hereof; provided, however, that the Grantee’s rights with respect to the Restricted Shares may be transferred by will or pursuant to the laws of descent and distribution.  Any purported transfer in violation of the provisions of this Section 3 shall be void, and the other party to any such purported transaction shall not obtain any rights to or interest in the Restricted Shares.

 

4.                                      Vesting of Restricted Shares.  Subject to the terms and conditions of this Agreement and the Plan, the shares of Restricted Stock shall vest in accordance with the vesting schedule set forth on Exhibit A hereto provided the Grantee remains continuously employed by the Company until the applicable vesting dates listed on Exhibit A.

 

5.                                      Accelerated Vesting of Restricted Shares.  Notwithstanding the provisions of Section 4 hereof, the shares of Restricted Stock covered by this Agreement shall become immediately vested in full if any of the following circumstances apply:

 

(a)                                 Termination without Cause or Good Reason:  Grantee’s termination of employment without “Cause” or with “Good Reason” (as each term is defined in the Grantee’s Employment Agreement with the Company, dated March 11, 2010, as may be amended from time to time (the “Employment Agreement”)).

 

(b)                                 Death or Disability:  Grantee dies or upon his “Disability” (as such term is defined in the Employment Agreement).

 

(c)                                  Change in Control:  A Change in Control occurs while Grantee is an employee of the Company.

 

1

 

6.                                      Forfeiture of Shares.  Except to the extent the shares of Restricted Stock covered by this Agreement have vested pursuant to Sections 4 or 5 hereof, Grantee’s right to retain the shares of Restricted Stock covered by this Agreement shall be forfeited automatically and without further notice on the date that Grantee ceases to be an employee of the Company or a Subsidiary prior to the third anniversary of the Date of Grant for any reason other than as described in Section 5.

 

7.                                      No Employment Contract.  Nothing contained in this Agreement shall (a) confer upon Grantee any right to be employed by or remain employed by the Company, or (b) limit or affect in any manner the right of the Company to terminate the employment of Grantee at any time.

 

8.                                      Withholding Taxes.  To the extent that the Company is required to withhold any federal, state, local or foreign taxes in connection with any delivery of shares of Restricted Stock to the Grantee, and the amounts available to the Company for such withholding are insufficient, it shall be a condition to the receipt of such delivery that the Grantee shall pay such taxes or make arrangements that are satisfactory to the Company for payment thereof.  The Grantee may elect that all or any part of such withholding requirement be satisfied by retention by the Company of a portion of the shares of Restricted Stock delivered to the Grantee.  If such election is made, the shares so retained shall be credited against such withholding requirement at the Fair Market Value on the date of such delivery.  In no event, however, shall the Company accept shares for payment of taxes in excess of required tax withholding rates.

 

2

 

9.                                      Restrictive Covenants.  If the Grantee engages in any conduct in breach of any noncompetition, nonsolicitation or confidentiality obligations to the Company under any agreement, policy or plan, then such conduct shall also be deemed to be a breach of the terms of the Plan and this Agreement. Upon such breach, Grantee’s right to receive the shares of Restricted Stock covered by this Agreement shall be forfeited automatically and without further notice and, if and to the extent any shares of Restricted Stock covered by this Agreement have vested pursuant to Sections 4 or 5 within a period of 18 months prior to such breach, the Grantee shall be required to return to the Company, upon demand, such shares or the net proceeds of any sales.  For purposes of this Section 9, net proceeds shall mean the amount realized upon the disposition of the shares, less any applicable taxes withheld by the Company.

 

10.                               Recovery of Restricted Stock.  If (a) the Company restates any part of its financial statements for any fiscal year or years during which the shares of Restricted Stock covered by this Agreement have been granted due to material noncompliance with any financial reporting requirement under the U.S. securities laws applicable to such fiscal year or years (a “Restatement”) and (b) the Committee determines that Grantee is personally responsible for causing the Restatement as a result of Grantee’s personal misconduct or any fraudulent activity on the part of Grantee, then the Committee has discretion to, based on applicable facts and circumstances and subject to applicable law, cause the Grantee’s right to receive the shares of Restricted Stock covered by this Agreement to be forfeited automatically and without further notice and, if and to the extent any shares of Restricted Stock covered by this Agreement have vested pursuant to Sections 4 or 5 within a period of 18 months prior to the Restatement, the Grantee shall be required to return to the Company, upon demand, such shares or the net proceeds of any sales.  For purposes of this Section 10, net proceeds shall mean the amount realized upon the disposition of the shares, less any applicable taxes withheld by the Company.  Notwithstanding anything herein to the contrary, Grantee’s consent shall not be required for an amendment to this Agreement that is deemed necessary by the Company to ensure compliance with the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”) or any regulations promulgated thereunder, including as a result of the implementation of any recoupment policy the Company adopts to comply with the requirements set forth in the Dodd-Frank Act.

 

11.                               Relation to Plan.  This Agreement is subject to the terms and conditions of the Plan.  In the event of any inconsistency between the provisions of this Agreement and the Plan, the Plan shall govern.  The Committee acting pursuant to the Plan, as constituted from time to time, shall, except as expressly provided otherwise herein or in the Plan, have the right to determine any questions that arise and to exercise its discretionary authority under the Plan in connection with the grant of shares of Restricted Stock.

 

12.                               Miscellaneous. All decisions or interpretations of the Committee with respect to any question arising under the Plan or this Agreement shall be binding, conclusive and final. The waiver by the Company of any provision of this Agreement shall not operate as or be construed to be a subsequent waiver of the same provision or of any other provision of this Agreement.  Grantee agrees to execute such other agreements, documents or assignments as may be necessary or desirable to effect the purposes of this Agreement.

 

13.                               Capitalized Terms. All capitalized terms used in this Agreement that are not defined herein shall have the meanings given them in the Plan unless the context clearly requires otherwise.

 

IN WITNESS WHEREOF, the Company has caused this Agreement to be executed on its behalf by its duly authorized officer, as of the day and year first above written.

 

	
 
    	
MYR GROUP INC.
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name: William A. Koertner
    
	
 
    	
 
    	
Title: President and Chief Executive   Officer
    

 

3

 

The undersigned Grantee hereby acknowledges receipt of an executed copy of this Agreement and accepts the right to receive any shares of Restricted Stock or other securities covered hereby, subject to the terms and conditions of the Plan and the terms and conditions herein above set forth.

 

 

	
 
    	
 
    
	
 
    	
Grantee
    
	
 
    	
 
    
	
 
    	
Date:
    	
 
    

 

4

 

Exhibit A

 

Time Based Restricted Stock Vesting Schedule

Grant of Date March 24, 2014

 

	
Date
    	
 
    	
Total Shares of Restricted Stock Vested
    	
 
    
	
March 24, 2015
    	
 
    	
 
    	
 
    
	
March 24, 2016
    	
 
    	
 
    	
 
    
	
March 24, 2017
    	
 
    	
 
    	
 
    

 

5

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