Document:

Tax Disaffiliation Agreement Consent

 EXHIBIT 10(i)A5 
  
 AGREEMENT AND CONSENT RELATING TO TAX DISAFFILIATION AGREEMENT 
  
 This AGREEMENT AND CONSENT RELATING TO TAX DISAFFILIATION AGREEMENT dated as
of June 11, 2003 by and between NATIONAL SERVICE INDUSTRIES, INC. (“NSI-Del”), a Delaware corporation, NATIONAL SERVICE INDUSTRIES, INC. (“NSI Enterprises”), a California corporation, and ACUITY BRANDS, INC.
(“Spinco”), a Delaware corporation. 
  
 RECITALS 
  
 A.    In
connection with the transactions contemplated by the Agreement and Plan of Distribution (the “Distribution Agreement”), dated November 30, 2001, by and between NSI-Del and Spinco, NSI-Del, NSI Enterprises and Spinco entered into the
Tax Disaffiliation Agreement, dated as of November 30, 2001 (the “Agreement”), to set forth their rights and obligations with respect to taxes. 
  

B.    On April 1, 2003, NSI-Del entered into the Agreement and Plan of Merger (the “Merger Agreement”) by and
between NSI-Del and NS Acquisition Corp., a Delaware corporation (“Buyer”), pursuant to which Buyer will be merged with and into NSI-Del, with NSI-Del as the surviving corporation (the “Merger”). 
  
 C.    In contemplation of the Merger, the parties hereto
have agreed to enter into this Agreement and Consent Relating to Tax Disaffiliation Agreement (the “Agreement and Consent”). 
  
 NOW, THEREFORE, in consideration of the mutual covenants set forth herein, and other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the parties hereto agree as follows: 
  
 1.    The parties acknowledge that, as of the date of this Agreement and Consent, the provisions of the Agreement relating to the obligations of Spinco and NSI-Del with respect to the federal income tax liability
reflected in the consolidated federal income tax return filed by NSI-Del for the taxable year ended August 31, 2002, have been fully satisfied. For the avoidance of doubt, the parties agree that the provisions of the Agreement relating to the
special allocation of $5,258,977 of tax liability to NSI-Del, including the provisions of the second sentence of Section 2.03(b) of the Agreement that “NSI-Del shall be liable for, and shall hold the Spinco Group harmless on an After Tax Basis
against, $5,258,977 of tax liability of any member of the Spinco Group or any member of the NSI-Del Group for any Period Before the Second Distribution,” are satisfied by the inclusion of the taxable income associated with the Oglethorpe Power
safe harbor lease in determining the federal income tax liability of the NSI-Del Group for the taxable year ended August 31, 2002. 
  
 2.    To the extent permitted by law, any member of the NSI-Del Group may elect to carry back, pursuant to Section 3.01(b), (i) any
net operating loss attributable to 

 
the fiscal year ended August 31, 2002, to the taxable year ended August 31, 1997, and (ii) any wage credits attributable to the fiscal year ended August 31,
2002, to the taxable year ended August 31, 2001. Such carrybacks shall be governed by all of the provisions of Section 3.01(b) (including the indemnity obligations of NSI-Del set forth in the fourth sentence thereof, which indemnity obligations
shall, for sake of clarification, include any amount which may be assessed solely by reason of Section 6501(k) of the Code). Spinco hereby consents to the carrybacks and approves filing any claim for refund relating to such carrybacks. 

 
 3.     The parties acknowledge that they have a
dispute concerning the application and interpretation of the Agreement with respect to certain credits for increasing research activities and foreign tax credits attributable to activities of members of the Spinco Group during the portion of the
Stub Period ended on the Date of the Second Distribution. Notwithstanding such dispute, the parties agree that such credits for increasing research activities shall be carried back to the taxable year ended August 31, 2001, and that such foreign tax
credits shall be carried back to the taxable year ended August 31, 2000. The parties hereby consent to those carrybacks and approve filing any claim for refund relating to such carrybacks. However, neither the facts of the execution of this
Agreement and Consent nor any provision contained herein is intended or shall be construed to affect in any way the resolution of the dispute between the parties concerning the application and interpretation of the Agreement with respect to such
credits. 
  
 4.    The parties hereby
acknowledge and agree that NSI-Del has satisfied in full its obligations to provide notice to Spinco with respect to the Merger Agreement and the Merger as provided in Section 2.04(d) of the Agreement. 
  
 5.    The Agreement shall be read together and shall have
the same force and effect as if the provisions of the Agreement and this Agreement and Consent were contained in one document. The Agreement shall remain in full force and effect in accordance with its terms. Capitalized terms used but not defined
in this Agreement and Consent shall have the meanings ascribed to them in the Agreement. 
  
 6.    This Agreement and Consent may be executed in any number of counterparts and by the parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original
and all of which taken together shall constitute one and the same agreement. 
  

 2 

 IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement and Consent as of the day and
year first above written. 
  

	 ACUITY BRANDS, INC.,
 a Delaware
corporation

		
	 By:
	 	 /s/ Kenyon W. Murphy
  

	 Name:    Kenyon W. Murphy
 Title:      Sr. V.P. & General Counsel

  

		
	Witness:	 	     /s/ Helen D. Haines
  

	Name:        Helen D. Haines

  
  

	 NATIONAL SERVICE INDUSTRIES, INC.,
 a Delaware corporation

		
	 By:
	 	 /s/ Brock Hattox
  

	 Name:    Brock Hattox
 Title:      Chairman of the Board, CEO & President

  

		
	Witness:	 	     /s/ Carol Ellis Morgan
  

	Name:    Carol Ellis Morgan

  
  

	 NATIONAL SERVICE INDUSTRIES, INC.,
 a California corporation

		
	 By:
	 	 /s/ Brock Hattox
  

	 Name:    Brock Hattox
 Title:      Chairman of the Board, CEO & President

  

		
	Witness:	 	     /s/ Carol Ellis Morgan
  

	Name:    Carol Ellis Morgan

  

 3Retirement Program Change, James Heagle

 EXHIBIT 10(iii)A3 
  
 June 20, 2003 
  
 James H. Heagle 
 Executive Vice President 
 Acuity Brands, Inc. 
 1170 Peachtree Street, NE 
 Suite 2400 
 Atlanta, GA 30309 
  
 Dear Jim: 
  
 Acuity Brands recently undertook a review of its retirement programs and, as a result of that review, a number of changes to
the plans covering employees at the corporate office were implemented on January 1, 2003. This letter provides an overview of the changes that affect you. 
  
 The 401(k) Plan covering corporate office employees was changed effective January 1, 2003, in a number of respects: 
  

	 	•	 	For administrative and compliance purposes, the 401(k) Plan was combined with the Acuity Lighting Group 401(k) Plan. The resulting plan, called the Acuity Brands, Inc. 401(k) Plan,
is substantially the same as the current plan. To facilitate this merger, there was a short “blackout period,” described on Exhibit A. 

  

	 	•	 	Matching contributions were increased to 60% of the participant’s deferrals up to 6% of compensation (a total match of 3.6% or a 20% increase over the current plan).

  

	 	•	 	Vesting in the Company’s matching contributions will be based upon the period from your date of hire to your date of termination rather than hours of service worked each
calendar year, but in no event will a current participant receive fewer years of service than under the prior rules. 

  

	 	•	 	The minimum hardship withdrawal will be reduced to $500 from $1,000. 

  
 Except for the changes outlined above, the combined 401(k) Plan will operate in the same manner as the plan in which you currently participate, including employee
deferrals, investment options and changes, payouts and loan rules. 

 James H. Heagle 
 June 20,
2003 
 Page 2 
  
 With respect to the Acuity Brands, Inc. Pension Plan, the defined benefit pension plan that covers corporate office employees: 
  

	 	•	 	Benefit accruals under the Pension Plan ceased effective as of December 31, 2002, and no compensation earned or service credited after that date will count under the plan (see
attached Notice of Cessation of Benefit Accruals). 

  

	 	•	 	Your accrued benefit in the Pension Plan (if any) will be paid to you after you terminate employment in accordance with the terms of the plan. 

  
 You are currently a participant in the Acuity Brands, Inc. Supplemental
Retirement Plan for Executives (“Current SERP”). As you are aware, your participation in the Current SERP will cease effective as of December 31, 2002, contingent upon your waiver of the benefits due you under that plan, at which time you
will become a participant in the Acuity Brands, Inc. 2002 Supplemental Executive Retirement Plan (“New SERP”). As shown on Exhibit B attached hereto, your benefits are greater under the New SERP than under the Current SERP. 
  
 Please indicate your waiver of benefits under the Current SERP and your
acceptance of benefits under the New SERP, effective as of December 31, 2002, by signing and dating both copies of this letter in the space provided below. Please return one copy of the signed letter to Helen Haines at the Peachtree office at your
earliest convenience, but no later than July 1, 2003. 
  
 If you
have any questions concerning these plan changes, please contact Jane Struble at 770-860-3545. 
  

	 Very truly yours,

	
	 /s/ Larry Miller         

	 Larry Miller

  

	 J. H. Heagle

	James H. Heagle
	
	 6-23-03

	Date

 EXHIBIT A 
  

ACUITY BRANDS, INC. 
 401(K) PLAN

  
 TRANSITION PERIOD AND BLACKOUT PERIOD

  
 DECEMBER 20TH—Last day to submit distribution paperwork to Acuity Brands. 
  
 DECEMBER 30TH—Up to 4 p.m. ET—Last day to make any of the following transactions until blackout period is over: 
  

	 	•	 	Change your contribution percentage 

  

	 	•	 	Request a loan 

  

	 	•	 	Make changes to future investment elections 

  

	 	•	 	Transfer balances among investment funds 

  
 During this period participants will still be able to view their account balances; however, no transaction can be made. 
  
 JANUARY 1, 2003—Plan accounts transferred to merged 401(k) Plan. At this point,
accounts will no longer be available for viewing until blackout is over. 
  
 JANUARY 4, 2003—Blackout over and participants have access to their account for all purposes. 

 Exhibit B 
 SERP Benefit Comparison 
 James H. Heagle 
  

	 Present Value of Benefits at January 1, 2003
	  	 
	 Current SERP
	  	243,200
	 Plan C Benefit Loss
	  	56,897
	 EDCP Match Loss
	  	7,100
	 	  	

	 Total Current Plans
	  	307,197
	 New SERP
	  	396,100
	 	  	

	 Decrease in Benefits
	  	NA

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