-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, PRekK6uPmpXF595ftb/0OtSJ63w6nXfwAMyRGmsp/r/eiSp7XHPlwKE1ApjH8QYa tHQxMvD3LA65VyBNPgwciQ== 0001052045-01-000001.txt : 20010122 0001052045-01-000001.hdr.sgml : 20010122 ACCESSION NUMBER: 0001052045-01-000001 CONFORMED SUBMISSION TYPE: S-8 PUBLIC DOCUMENT COUNT: 7 FILED AS OF DATE: 20010103 EFFECTIVENESS DATE: 20010103 FILER: COMPANY DATA: COMPANY CONFORMED NAME: SERVICEMASTER CO CENTRAL INDEX KEY: 0001052045 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-MANAGEMENT SERVICES [8741] IRS NUMBER: 363858106 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: S-8 SEC ACT: SEC FILE NUMBER: 333-53142 FILM NUMBER: 1501242 BUSINESS ADDRESS: STREET 1: ONE SERVICEMASTER WAY CITY: DOWNERS GROVE STATE: IL ZIP: 60515 BUSINESS PHONE: 6302711300 MAIL ADDRESS: STREET 1: ONE SERVICEMASTER WAY CITY: DOWNERS GROVE STATE: IL ZIP: 60515 S-8 1 0001.txt FORM S-8 RE: SERVICEMASTER PLANS As filed with the Securities and Exchange Commission on January 3, 2001. Registration No. 333-_____ SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM S-8 REGISTRATION STATEMENT Under The Securities Act of 1933 -------------------- The ServiceMaster Company (Exact name of registrant as specified in its charter) Delaware 36-3858106 (State or other jurisdiction of I.R.S. Employer incorporation or organization) (Identification No.) One ServiceMaster Way Downers Grove, Illinois 60515-1700 (630) 271-1300 (Address and telephone number of principal executive offices) ------------------------------ ServiceMaster Deferred Compensation Plan ServiceMaster Employee Share Purchase Plan ServiceMaster Employee Share Purchase Plan International Trust The ServiceMaster Company 1998 Non-Employee Directors Discounted Stock Option Plan (Full titles of the plans) Jim L. Kaput Senior Vice President and General Counsel The ServiceMaster Company One ServiceMaster Way Downers Grove, Illinois 60515 (630) 271-1300 (Name, address including zip code, and telephone number, including area code, of agent for service) - -------------------------------------------------------------------------------- CALCULATION OF THE REGISTRATION FEE
Proposed Proposed Titles of maximum maximum Amount of securities Amount to be offering aggregate registration to be registered price offering registered per unit price - ------------------------------------------------------------------------------------------------------------------------------------ Common stock 41,580 (1)(2) $15.7392(3) $654,436 (3) $164 (3) Common stock 27,962 (1)(2) $19.3588(3) $541,311 (3) $135 (3) Common stock 35,022 (1)(2) $18.0413(3) $631,842 (3) $158 (3) Common stock 33,528 (1)(2) $18.6788(3) $626,263 (3) $157 (3) Common stock 38,237 (1)(2) $17.1913(3) $657,344 (3) $164 (3) Common stock 25,553 (1)(2) $15.5231(3) $396,662 (3) $99 (3) Common stock 49,235 (1)(2) $13.2068(3) $650,237 (3) $163 (3) Common stock 9,097 (1)(2) $9.7325(3) $88,537 (3) $22 (3) Common stock 43,358 (1)(2) $9.7856(3) $424,284 (3) $106 (3) Common stock 48,667 (1)(2) $10.2319(3) $47,752 (3) $12 (3) Common stock 56,392 (1)(2) $8.4788(3) $478,136 (3) $120 (3) Common stock 2,015,000 (1)(2) $10.3800(4) $20,915,700 (4) $5,229 (4) Common stock 341,369 (1)(2) $10.3800(4) $3,543,410 (4) $886 (4) Deferred Compensation Obligations $15,000,000 (5) n/a(5) $15,000,000 (5) $3,750 Total Fee $11,165
(1) This registration statement reflects the 3 for 2 stock split paid on August 26, 1998 to stockholders of record on August 12, 1998. Pursuant to Rule 416 under the Securities Act of 1933, this registration statement shall be deemed to cover any additional shares issuable pursuant to the antidilution provisions of The ServiceMaster Company 1998 Non-Employee Directors Discounted Stock Option Plan by reason of share splits, share dividends, mergers and other capital changes. (2) Of the Common Stock being registered, 2,000,000 shares relate to the ServiceMaster Employee Share Purchase Plan, 15,000 shares relate to the ServiceMaster Employee Share Purchase Plan International Trust, and 750,000 shares relate to The ServiceMaster Company 1998 Non-Employee Directors Discounted Stock Option Plan. (3) Calculated pursuant to Rule 457(h) under the Securities Act of 1933. (4) Calculated pursuant to Rule 457(c) under the Securities Act of 1933 and based upon the average high and low sale prices of the common stock reported on the New York Stock Exchange on December 28, 2000. (5) The Deferred Compensation Obligations are unsecured obligations of The ServiceMaster Company to pay deferred compensation in the future in accordance with the terms of the ServiceMaster Deferred Compensation Plan. Participants in the Plan may elect from among various investment options, including common stock. These investments will accrue earnings (or losses) on the obligations based on their respective performance. PART II INFORMATION REQUIRED IN THE REGISTRATION STATEMENT Item 3. Incorporation of Documents by Reference. ServiceMaster has filed the following documents with the Securities and Exchange Commission (the "Commission") pursuant to the Securities Exchange Act of 1934 (the "Exchange Act") and such documents are incorporated herein by reference: 1. ServiceMaster's Annual Report on Form 10-K for the year ended December 31, 1999; 2. All other reports filed pursuant to Section 13(a) or 15(d) of the Exchange Act since December 31, 1999; and 3. The description of the Common Stock that is contained in ServiceMaster's Registration Statement filed with the Commission under Section 12 of the Exchange Act, including any subsequent amendment or any report filed for the purpose of updating such description. All documents filed by ServiceMaster with the Commission pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act, after the date of this Registration Statement and prior to the filing of a post-effective amendment to this Registration Statement that indicates that all securities offered hereby have been sold or that deregisters all securities then remaining unsold, shall be deemed to be incorporated by reference into this Registration Statement and to be a part hereof from the respective dates of filing of such documents (such documents, and the documents enumerated above, being hereinafter referred to as "incorporated documents"). Any statement contained in an incorporated document shall be deemed to be modified or superseded for this purpose to the extent that a statement contained herein or in any other subsequently filed document which also is or is deemed to be incorporated by reference herein modifies or supersedes such statement. Any such statement so modified or superseded shall not be deemed, except as so modified or superseded, to constitute a part of this registration statement. 1 Item 4. Description of Securities. The $15,000,000 of deferred compensation obligations (the "Obligations") being registered under this Registration Statement may be offered to certain eligible employees of ServiceMaster and its subsidiaries pursuant to the ServiceMaster Deferred Compensation Plan (the "Deferred Compensation Plan"). The Obligations are general unsecured obligations of ServiceMaster to pay deferred compensation in the future in accordance with the terms of the Deferred Compensation Plan from the general assets of ServiceMaster and rank pari passu with other unsecured and unsubordinated indebtedness of ServiceMaster from time to time outstanding. ServiceMaster has established a trust to hold assets contributed under the Deferred Compensation Plan. However, these assets remain general assets of ServiceMaster and rank pari passu with other unsecured and unsubordinated indebtedness of ServiceMaster from time to time outstanding. The amount of compensation deferred by each participant is determined in accordance with each participant's deferral election and the provisions of the Deferred Compensation Plan. The Deferred Compensation Plan provides the investment of each participant's deferral account in such investments as the participant may have elected from among various investment options in each Deferred Compensation Plan year. One such investment is the Common Stock of ServiceMaster ("ServiceMaster Stock"). Currently, a participant's deferral account is indexed to the investment elections made by such participant in accordance with the Deferred Compensation Plan. The Obligations are bookkeeping accounts, the returns on which are measured by the performance of certain investment vehicles. Participants cannot sell, assign, transfer, pledge, or otherwise encumber any Obligations. All deferral accounts together with earnings thereon will be payable upon the termination of the deferral period, retirement, death, disability or termination of employment in a single lump sum or, at the election of the participant, in annual installments in accordance with the terms of the Deferred Compensation Plan. ServiceMaster reserves the right to amend or terminate the Deferred Compensation Plan at any time, except that no amendment or termination may adversely affect the rights of any participant with respect to amounts that have been credited to a participant's account prior to the date of amendment or termination. 2 The Obligations are not convertible into any other security of ServiceMaster. The Obligations will not have the benefit of a negative pledge or any other affirmative or negative covenant of ServiceMaster. Item 5. Interests of Named Experts and Counsel. Not applicable. Item 6. Indemnification of Directors and Officers. ServiceMaster is incorporated under the laws of the State of Delaware. The Delaware General Corporation Law allows for indemnification of directors and officers of Delaware corporations against certain expenses, judgments, fines and settlements in connection with litigation. ServiceMaster's Amended and Restated Certificate of Incorporation limits the personal liability of its directors and officers and provides for indemnification of its directors and officers against certain liabilities. The Delaware General Corporation Law further authorizes a corporation to purchase and maintain insurance on behalf of its directors and officers against certain liabilities. All of ServiceMaster's directors and officers are covered by insurance policies maintained and held in effect by ServiceMaster against certain liabilities for actions taken in such capacities, including liabilities under the Securities Act of 1933. Item 7. Exemption from Registration Claimed. Not Applicable Item 8. Exhibits. See Index to Exhibits. Item 9. Undertakings. (a) The undersigned registrant hereby undertakes: 3 (1) To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement; (i) To include any prospectus required by Section 10(a)(3) of the Securities Act of 1933; (ii) To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than 20 percent change in the maximum aggregate offering price set forth in the "Calculation of Registration Fee" table in the effective registration statement; (iii)To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement; provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) of this section do not apply if the registration statement is on Form S-3, Form S-8, or Form F-3, and the information required to be included in a post-effective amendment by those paragraphs is contained in periodic reports filed with or furnished to the Commission by the registrant pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934 that are incorporated by reference in the registration statement. (2) That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. 4 (3) To remove from registration by means of a post-effective amendment any of the securities being registered that remain unsold at the termination of the offering. (b) The undersigned registrant hereby undertakes that, for purposes of determining any liability under the Securities Act of 1933, each filing of the registrant's annual report pursuant to Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934 (and, where applicable, each filing of an employee benefit plan's annual report pursuant to Section 15(d) of the Securities Exchange Act of 1934) that is incorporated by reference in the registration statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. (c) Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue. 5 Signatures Pursuant to the requirements of the Securities Act of 1933, the registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-8 and has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Downers Grove, State of Illinois on this 3rd day of January, 2001. THE SERVICEMASTER COMPANY By: /s/ Jim L. Kaput ------------------------------------ Jim L. Kaput Senior Vice President and General Counsel Pursuant to the requirements of the Securities Act of 1933, the following persons in the capacities indicated signed this Registration Statement on January 3, 2001. Signature Title - -------------------------------------------- --------------------------- * Chairman, Chief Executive - -------------------------------------------- C. William Pollard Officer and Director /s/ Steven C. Preston Executive Vice President, - -------------------------------------------- Steven C. Preston Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer) * Senior Chairman and - -------------------------------------------- Director Carlos H. Cantu * Director - -------------------------------------------- Paul W. Berezny, Jr. 6 * Director - -------------------------------------------- Brian Griffiths * Director - ------------------------------------------------- Sidney E. Harris * Director - -------------------------------------------- Glenda A. Hatchett * Director - -------------------------------------------- Herbert P. Hess * Director - -------------------------------------------- Michele M. Hunt * Director - -------------------------------------------- Gunther H. Knoedler * Director - -------------------------------------------- James D. McLennan * Director - -------------------------------------------- Vincent C. Nelson * Director - -------------------------------------------- Dallen W. Peterson * Director - -------------------------------------------- Donald G. Soderquist * Director - -------------------------------------------- Charles W. Stair 7 * Director - -------------------------------------------- David K. Wessner * The undersigned, by signing his name hereto, does sign and execute this Registration Statement pursuant to the Powers of Attorney executed by certain of the above-named officers and directors of The ServiceMaster Company. By: /s/ Jim L. Kaput -------------------------------------- Jim L. Kaput Attorney-in-Fact 8 EXHIBIT INDEX Exhibit Description No. - ------ --------------------------------------------------------------------- 4.1 ServiceMaster's Amended and Restated Certificate of Incorporation, as filed with the Secretary of State of Delaware on November 6, 1997, is incorporated by reference to Exhibit 1 to the Current Report on Form 8-K, dated December 18, 1997, of ServiceMaster Limited Partnership (Commission File No. 1-9378). 4.2 ServiceMaster's Bylaws, as amended through September 29, 2000, are incorporated by reference to Exhibit 1.4 to Amendment No. 1 to Form 8-A/A, dated October 6, 2000 (Commission File No. 1-14762). 4.3* ServiceMaster Deferred Compensation Plan. 4.4* Form of Election Form for ServiceMaster Deferred Compensation Plan. 4.5 ServiceMaster Employee Share Purchase Plan is incorporated by reference to Exhibit 10 to the Second Post-Effective Amendment to Form S-8, dated May 13, 1987, of ServiceMaster Limited Partnership (Commission File No. 2-75851). 4.6* ServiceMaster Employee Share Purchase Plan International Trust. 4.7 The ServiceMaster Company 1998 Non-Employee Directors Discounted Stock Option Plan is incorporated by reference to Exhibit B to the March 25, 1998 Proxy Statement relating to The ServiceMaster Company 1998 Annual Meeting of Shareholders held May 1, 1998 (Commission File No. 1-14762). 5* Opinion of Counsel 23.1* Consent of Arthur Andersen LLP 23.2* Consent of Counsel (included in Exhibit 5) 24* Powers of Attorney *Filed herewith 9 EX-4 2 0002.txt DEFERRED COMPENSATION PLAN CERTIFICATE I, _____________________, Secretary of ServiceMaster Management Corporation, the Managing General Partner of ServiceMaster Limited Partnership, hereby certify that the attached document is a correct copy of the ServiceMaster Deferred Compensation Plan, as in effect on the date hereof. Dated this ___ day of __________, 199_. By ______________________ Secretary as Aforesaid (Corporate Seal) SERVICEMASTER DEFERRED COMPENSATION PLAN (Effective January 1, 1997) Kirkland & Ellis Chicago, Illinois SERVICEMASTER DEFERRED COMPENSATION PLAN TABLE OF CONTENTS
PAGE ARTICLE I - Introduction.................................................................................1 1.1. Name.......................................................................................1 1.2. Purpose....................................................................................1 1.3. Administration of the Plan.................................................................1 ARTICLE II - Definitions.................................................................................2 ARTICLE III - Plan Participation.........................................................................4 3.1. Eligibility................................................................................4 3.2. Participation..............................................................................4 ARTICLE IV - Election to Defer...........................................................................4 4.1. Deferral Election..........................................................................4 4.2. Timing of Deferral Election................................................................4 ARTICLE V - Earnings on Account Balances.................................................................5 5.1. Permitted Investments......................................................................5 5.2. Receipts...................................................................................5 5.3. Committee May Disapprove Permitted Investments.............................................5 5.4. Elections..................................................................................6 5.5. Actual Investment Not Required.............................................................6 5.6. Investment Notices.........................................................................6 5.7. Crediting of Deferrals.....................................................................6 ARTICLE VI - Establishment of Trust......................................................................7 6.1. Establishment of Trust.....................................................................7 6.2. Status of Trust............................................................................7 ARTICLE VII - Distribution of Account Balances...........................................................7 7.1. Normal Form of Distribution of Account Balances............................................7 7.2. Separation from Service Prior to Year of Distribution....................................................................................8 7.3. Emergency Payments.........................................................................8 7.4. Involuntary Distributions..................................................................9 7.5. Designation of Beneficiaries...............................................................9 i ARTICLE VIII - Amendment or Termination.................................................................10 8.1. Amendment.................................................................................10 8.2. Plan Termination..........................................................................10 ARTICLE IX - General Provision..........................................................................10 9.1. Applicable Law............................................................................10 9.2. Assumption of Company Liability...........................................................10 9.3. Gender and Number: Headings...............................................................10 9.4. Immunity of Committee Members.............................................................11 9.5. Non-alienation of Benefits................................................................11 9.6. Notices...................................................................................11 9.7. Plan not to Affect Employment Relationship................................................11 9.8. Severability..............................................................................12 9.9. Subordination of Rights...................................................................12 9.10.Successors................................................................................12 9.11.Withholding for Taxes.....................................................................12 ii
SERVICEMASTER DEFERRED COMPENSATION PLAN ARTICLE I Introduction Section 1.1. Name. The name of the Plan shall be the "ServiceMaster Deferred Compensation Plan." Section 1.2. Purpose. This Plan, effective January 1, 1997, shall constitute an unfunded arrangement established and maintained for the purpose of providing deferred compensation to a select group of management or highly compensated employees (as such phrase is defined for purposes of Title I of the Employee Retirement Income Security Act of 1974, as amended ("ERISA")). This Plan shall further constitute an amendment and restatement of all currently outstanding individual agreements between the ServiceMaster Companies and highly compensated employees for deferral of compensation who are eligible and choose to participate in this Plan. Section 1.3. Administration of the Plan. The Plan shall be administered by the Committee. The Committee's duties and authority under the Plan shall include (i) the interpretation of the provisions of the Plan, (ii) the adoption of any rules and regulations which may become necessary or advisable in the operation of the Plan, (iii) the making of such determinations as may be permitted or required pursuant to the Plan, and (iv) the taking of such other action as may be required for the proper administration of the Plan in accordance with its terms. Any decision of the Committee with respect to any matter within the authority of the Committee shall be final, binding and conclusive upon the Employers and each Participant, former Participant, designated Beneficiary, and each person claiming under or through any participant or designated Beneficiary, and no additional authorization or ratification by the Board of Directors or stockholders of the Company shall be required. Any action by the Committee with respect to any one or more Participants shall not be binding on the Committee as to any action to be taken with respect to any other Participant. Committee members may be Participants, but no member of the Committee may participate in any decision directly affecting the computation of such Participant's benefits or rights under the Plan. Each determination required or permitted under the Plan shall be made by the Committee in the sole and absolute discretion of the Committee. 1 ARTICLE II Definitions "Account" shall mean the aggregate of the bookkeeping accounts maintained by the Employers for each Participant. "Account Balance" shall mean the value, as of the specified date, of the Participant's Account. "Beneficiary" shall mean the person, persons or legal entity entitled to receive benefits under this Plan which become payable in the event of the Participant's death. "Code" shall mean the Internal Revenue Code of 1986, as amended, and includes any regulations thereunder. "Committee" shall mean those individuals designated by the President and Chief Executive Officer of the Company. "Company" shall mean The ServiceMaster Limited Partnership and its successors or assigns under the Plan. "Compensation" shall mean compensation as defined in the PSSRP, as amended from time to time. "Deferral" shall mean the annual amount of Compensation that a Participant elects to defer pursuant to a properly executed voluntary salary deferral agreement. "Deferred Account" shall mean the bookkeeping account maintained on the Employer's books pursuant to Article IV of the Plan in the name of and for a Participant. "Effective Date" shall mean January 1, 1997 with respect to the terms of the Plan as set forth herein. "Eligible Employee" shall mean an employee of an Employer who: is highly compensated as defined in Code section 414(q); has met the eligibility requirements of the PSSRP; and has elected to make the maximum contribution allowable under the PSSRP. 2 "Employer Contribution" shall mean the amount credited to a Participant's Account that is equivalent to matching contributions which are not allowable under the PSSRP as determined by the Committee. "Employers" shall mean the Company and its subsidiaries and other related entities that adopt the Plan for the benefit of their Eligible Employees. "Entry Date" shall mean January 1, April 1, July 1 and October 1 of each Plan Year. "ERISA" shall mean the Employee Retirement Income Security Act of 1974, as amended, and any regulations thereunder. "Normal Retirement" shall mean age 65 and completion of at least five years of service. "Participant" shall mean any Eligible Employee who commences participation under the Plan pursuant to Article III. "Permitted Investment" shall mean (i) ServiceMaster shares; (ii) the following Vanguard Group Funds: S&P 500 Index Fund; Balanced Fund; Intermediate Bond Fund; and Money Market Fund; or (iii) such other fund or type of investment as may be approved by the Committee. "Plan" shall mean this ServiceMaster Deferred Compensation Plan, as amended from time to time. "Plan Year" shall mean the twelve consecutive month period designated by the Company. "PSSRP" shall mean the ServiceMaster Profit Sharing, Savings and Retirement Plan. "ServiceMaster Companies" shall mean the Company and all subsidiaries and related companies, without regard as to whether or not they have adopted the Plan. "Valuation Date" shall mean June 30 and December 31 of each Plan Year. 3 ARTICLE III Plan Participation Section 3.1. Eligibility. Each Eligible Employee will become eligible to participate in the Plan as of the later of the Effective Date, or on the Entry Date coincident with or next following the date he meets the requirements to be considered an Eligible Employee. Section 3.2. Participation. An Eligible Employee eligible to make a deferral election or who anticipates becoming eligible to make a deferral election in the upcoming year shall become a Participant by timely executing a voluntary salary deferral agreement and delivering such agreement to the appropriate individual designated by the Committee. ARTICLE IV Election to Defer Section 4.1. Deferral Election. Each eligible Participant may elect to defer a specific percentage of Compensation as a dollar amount to the Plan for the Plan Year provided that such deferrals shall be made as a deduction from the participant's pay each pay period in a uniform percentage. Each Participant shall additionally elect a deferral period of a minimum of three years but in no event may the Participant designate a deferral period which shall terminate after the date on which the Participant is eligible for Normal Retirement. Each Participant desiring to defer Compensation shall file an election with the Committee on such form, in such manner and at such times as may be satisfactory to the Committee. Completion of such election form shall evidence the Participant's authorization of the Employer to reduce his Compensation and, accordingly, such Participant's agreement to have such Participant's Compensation reduced by the amount specified in such election. Completion of such election form shall further evidence the Participant's election of the timing of distribution of such Participant's Account Balance. 4 Section 4.2. Timing of Deferral Election. The election to defer the receipt of Compensation shall be made prior to the period with respect to which the services for such Compensation will be rendered, and shall thereafter be irrevocable for such period. If no election is made with respect to any period for which services have been rendered, the Participant shall be deemed to have elected not to defer any of his Compensation earned with respect to such period. ARTICLE V Earnings on Account Balances Section 5.1. Permitted Investments. Each Participant may designate at one time each Plan Year, in such manner as may be satisfactory to the Committee, that all or a portion of the credits to such Participant's Account be deemed to be invested in one or more Permitted Investments in five percent increments. Such credits shall be deemed to be invested as specified by the Participant either (a) on the day following the later of (i) the date such Participant makes such designation, or (ii) the date such credit is made to such Participant's Account, or (b) on such other dates as may be reasonably determined by the Committee. Section 5.2. Receipts. Each account shall be deemed to receive all interest, dividends, earnings and other property which would have been received with respect to a Permitted Investment deemed to be held in such Account if the Employer actually owned such Permitted Investment. Cash deemed received with respect to a Permitted Investment shall be credited to the Account as of the date it would have been available for reinvestment if the Employer actually owned the Permitted Investment. Section 5.3. Committee May Disapprove Permitted Investments. Notwithstanding the foregoing, the Committee may disapprove any Permitted Investment designated by a Participant or deemed to be held in such Participant's Account. If the disapproved Permitted Investment has been designated by the Participant but is not then deemed to be held in such Participant's Account, the Committee shall promptly notify the Participant in writing of the decision to disapprove the Permitted Investment and shall afford the Participant an opportunity to designate one or more substitute Permitted Investments satisfactory to the Committee. If the disapproved Permitted Investment is deemed to be held in the Participant's Account, the Committee shall promptly notify the Participant in writing of the decision to disapprove the Permitted Investment and shall afford the Participant an opportunity to dispose of the disapproved Permitted Investment and to reinvest the deemed proceeds therefrom in one or more substitute Permitted Investments satisfactory to the Committee. If the Participant does not submit an election to dispose of the disapproved Permitted Investment within ten days after notice of disapproval by the Committee, the Committee may thereafter treat the disapproved Permitted Investment as having been sold on a date selected by the Committee and shall make appropriate charges and credits to the Account. Neither the Committee nor the Employer shall have any liability to the Participant for losses or expenses allocated to such Account by reason of a decision by the Committee to disapprove a Permitted Investment. 5 Section 5.4. Elections. All elections to be made by a Participant pursuant to this Article V shall be made only by such Participant, provided that if such Participant dies before such Participant's entire Account Balance is distributed, or if the Committee determines that such Participant is legally incompetent or otherwise incapable of managing such Participant's own affairs, the Committee shall have the authority to (a) itself make the elections pursuant to this Section 5.1 on behalf of such Participant, or (b) designate such Participant's designated Beneficiary, legal representative or some near relative of such Participant to make the elections pursuant to this Section 5.1 on behalf of such Participant. Section 5.5. Actual Investment Not Required. The Employer need not actually make any Permitted Investment. If the Employer should from time to time make any investment similar to a Permitted Investment, such investment shall be solely for the Employer's own account and the Participant shall have no right, title or interest therein. Accordingly, each Participant is solely an unsecured creditor of the Employer with respect to any account distributable to him under the Plan. Section 5.6. Investment Notices. Semi-annual statements describing the performance of the Permitted Investments will be provided to the Participants. Section 5.7. Crediting of Deferrals. The Employer shall credit all deferred compensation to a Participant's Deferred Account on the date corresponding with the date the deferrals would have been paid to the Participant if the Participant had not made a deferral election under Article IV of the Plan. Earnings shall be credited to such accounts in accordance with Section 5.1. 6 ARTICLE VI Establishment of Trust Section 6.1. Establishment of Trust. The Employer may, in its sole discretion, establish a grantor trust, as described under section 671 of the Code, which is subject to the claims of the general creditors of the Employer, for the purpose of accumulating assets to provide for the obligations hereunder. The establishment of such a trust shall not affect the Employer's liability to pay benefits hereunder except that the Employer's liability shall be offset by any payments actually made to a Participant under such a trust. In the event such a trust is established, the amount to be contributed shall be determined by the Employer and the investment of such assets shall be in accordance with the trust document. Section 6.2. Status of Trust. Participants shall have no direct or secured claim in any asset of the trust or in specific assets of the Employer or the ServiceMaster Companies and will have the status of general unsecured creditors of the Employer for any amounts due under this Plan. Trust assets and income will be subject to the claims of the Employer's creditors. ARTICLE VII Distribution of Account Balances Section 7.1. Normal Form of Distribution of Account Balances. Except as otherwise specifically provided, distribution of the vested balance of a Participant's Account shall be made to such Participant within a reasonable time after the Valuation Date in the year of distribution originally chosen by the Participant on such Participant's voluntary salary deferral agreement submitted to the Committee. The balance in the Participant's Account attributable to Employer Contributions and earnings thereon shall be vested in the same manner as employer contributions vest in accordance with the PSSRP or the ServiceMaster Consumer Services Profit Sharing Plan, whichever is applicable. The distribution of a Participant's Account shall be in the form of a single lump sum cash payment or ServiceMaster shares, but ServiceMaster shares shall only be distributed to the extent the Participant designated that all or a portion of the credits to his Account be deemed invested in ServiceMaster shares. 7 Section 7.2. Separation from Service Prior to Year of Distribution. If a Participant's employment with an Employer is terminated for any reason, including death, Normal Retirement, disability (as determined by a physician selected by the Employer), resignation or dismissal, more than one year prior to such Participant's year of distribution, the balance in such Participant's Account attributable to Deferrals and earnings thereon shall be fully vested and nonforfeitable and shall be distributable to the Participant or, in the event of the Participant's death, to such Participant's Beneficiary, in the form of a single lump sum cash payment or ServiceMaster shares, but ServiceMaster shares shall only be distributed to the extent the Participant designated that all or a portion of the credits to such Participant's Account be deemed invested in ServiceMaster shares. The balance in the Participant's Account attributable to Employer Contributions and earnings thereon shall be vested as employer contributions according to the terms and conditions of the PSSRP or the ServiceMaster Consumer Services Profit Sharing Plan, whichever is applicable. Payment of the Participant's Account Balance shall be made within a reasonable period of time of the Valuation Date immediately following such Participant's separation from service as determined by the Committee in its sole discretion. Section 7.3. Emergency Payments. A Participant may from time to time request, in such manner as may be satisfactory to the Committee, that the Committee authorize an Emergency Payment to such Participant. Any such distribution shall be for the sole purpose of enabling such Participant to meet such Participant's immediate and heavy financial needs arising as a result of poor health, unusual extreme economic need or termination of employment. If an Emergency Payment is authorized, the Committee shall distribute to such Participant, within a reasonable time, an amount determined by the Committee to be sufficient to alleviate the financial hardship, but not in excess of the Participant's Account Balance as of such date. In determining the amount to be distributed, the Committee may consider amounts reasonably available to the Participant from other sources. 8 Section 7.4. Involuntary Distributions. Notwithstanding the foregoing provisions of this Article VII, the Committee may on its own initiative authorize the Employer to distribute to any Participant (or to a designated Beneficiary in the event of the Participant's death) all or any portion of the Participant's Account Balance. Such payment would be specifically authorized in the event there is a change in tax law, a published ruling or similar announcement issued by the Internal Revenue Service, a regulation issued by the Secretary of Treasury, a decision by a court of competent jurisdiction involving a Participant or a Beneficiary, or a closing agreement made under section 7121 of the Code that is approved by the Internal Revenue Service and involves a Participant, and the Committee determines that a Participant has or will recognize income for Federal income tax purposes with respect to amounts deferred under this Plan prior to the time such amounts are paid to the Participant. Section 7.5. Designation of Beneficiaries. Each Participant may name any person (who may be named concurrently, contingently or successively) to whom the Participant's Account Balance under the Plan is to be paid if the Participant dies before the Account Balance is fully distributed. Each such Beneficiary designation will revoke all prior designations by the Participant, shall not require the consent of any previously named Beneficiary, shall be in a form prescribed by the Committee and will be effective only when filed with the Committee during the Participant's lifetime. If a Participant fails to designate a Beneficiary before such Participant's death, as provided above, or if the Beneficiary designated by a Participant dies before the date of the Participant's death or before complete payment of the Participant's Account Balance, the Committee shall pay the Participant's Account Balance to the Participant's estate in one lump sum. 9 ARTICLE VIII Amendment or Termination Section 8.1. Amendment. The Company shall have the right to amend the Plan from time to time except that no such amendment shall, without the consent of the Participant to whom deferred compensation has been credited to such Participant's Account, adversely affect the Participant's (and such Participant's Beneficiary's) right to payments of such deferred compensation. Section 8.2. Plan Termination. The Company may, in its discretion, terminate the Plan at any time, however, no termination shall alter a Participant's (and such Participant's Beneficiary's) right to payments of deferred compensation previously credited to such Participant's Account. ARTICLE IX General Provisions Section 9.1. Applicable Law. The Plan shall be construed in accordance with the internal laws of the State of Illinois. Section 9.2. Assumption of Company Liability. The Company's obligations under the Plan may be assumed by any subsidiary of the Company, in which case such subsidiary shall be obligated to satisfy all of the Company's obligations under the Plan and the Company shall be released from any continuing obligation under the Plan. At the Company's request, each Participant or designated Beneficiary shall sign such documents as the Company may require in order to effect the purposes of this subsection. Section 9.3. Gender and Number: Headings. Wherever any words are used herein in the masculine gender they shall be construed as though they were also used in the feminine gender in all cases where they would so apply, and wherever any words are used herein in the singular form they shall be construed as though they were also used in the plural form in all cases where they would so apply. Headings of sections and subsections of the Plan are inserted for convenience of reference and are not part of the Plan and are not to be considered in the construction thereof. 10 Section 9.4. Immunity of Committee Members. The members of the Committee may rely upon any information, report or opinion supplied to them by an officer of the Company or any legal counsel, independent public accountant or actuary, and shall be fully protected in relying upon any such information, report or opinion. No member of the Committee shall have any liability to the ServiceMaster Companies or any Participant, former Participant, designated Beneficiary, person claiming under or through any Participant or designated Beneficiary or other person interested or concerned in connection with any decision made by such member pursuant to the Plan which was based upon any such information, report or opinion if such member reasonably relied thereon in good faith. Section 9.5. Non-alienation of Benefits. A Participant's rights to the amount credited to his Account under the Plan shall not be grantable, transferable, pledgeable or otherwise assignable, in whole or in part, by the voluntary or involuntary acts of any person, or by operation of law, and shall not be liable or taken for any obligation of such person. Any such attempted grant, transfer, pledge or assignment shall be null and void and without any legal effect. Section 9.6. Notices. Any notice required to be given by the Employers or the Committee hereunder shall be in writing and shall be delivered in person or by registered mail, return receipt requested. Any notice given by registered mail, shall be deemed to have been given upon the date of delivery, correctly addressed to the last known address of the person to who such notice is to be given. Section 9.7. Plan not to Affect Employment Relationship. Neither the adoption of the Plan nor its operation shall in any way affect the right and power of the Employers to dismiss or otherwise terminate the employment or change the terms of the employment or amount of compensation of any Participant at any time for any reason with or without cause. By accepting any payment under this Plan, each Participant, former Participant, designated Beneficiary and each person claiming under or through such person, shall be conclusively bound by any action or decision taken or made or to be taken or made under the Plan by the Committee. 11 Section 9.8. Severability. If any provision of the Plan shall be held illegal or invalid for any reason, such illegality or invalidity shall not affect the remaining provisions of the Plan, and the Plan shall be construed and enforced as if illegal or invalid provisions had never been set forth herein. Section 9.9. Subordination of Rights. At the committee's request, each Participant or designated Beneficiary shall sign such documents as the Committee may required in order to subordinate such Participant's or designated Beneficiary's rights under the Plan to the rights of such other creditors of the Employers as may be specified by the Committee. Section 9.10. Successors. The Plan is binding on all persons entitled to benefits hereunder and their respective heirs and legal representatives, on the Committee and its successor, on the Employers, and on the Company and its successor, whether by way of merger, consolidation, purchase or otherwise. Section 9.11. Withholding for Taxes. Notwithstanding anything contained in this Plan to the contrary, the appropriate amounts shall be withheld from any distribution made under the Plan as may be required for purposes of complying with the tax withholding provisions of the Code or any state's income tax act for purposes of pay any estate, inheritance or other tax attributable to any amounts distributable or creditable under the Plan. 12 EX-4 3 0003.txt ELECTION FORM FOR DEFERRED COMPENSATION PLAN ServiceMaster Deferred Compensation Plan 2000 Election Form - ------------------------------------------------------------------------------------------------------------------------------------ SECTION 1 - EMPLOYEE INFORMATION: - ------------------------------------------------------------------------------------------------------------------------------------ - ---------------------------------------------------------------------- ------------------------------------------------------------- Last Name First Name MI Social Security Number - ---------------------------------------------------------------------- ------------------------------------------------------------- Home Address Birthdate Month Day Year - ---------------------------------------------------------------------- ------------------------------------------------------------- City State Zip Hire Date Month Day Year - ------------------------------------------------------------------------------------------------------------------------------------ SECTION 2 - CHOICE TO PARTICIPATE: - ------------------------------------------------------------------------------------------------------------------------------------ I choose to participate in the ServiceMaster Deferred Compensation Plan and for the 2000 plan year, I authorize my employer to deduct these Plan Contributions from my pay (including any bonuses, commissions, and overtime pay I am entitled to receive) on a pre-tax basis based on the percentage marked below. CONTRIBUTION_____% (whole percentages) ___________________ maximum dollar amount (optional) (Note - the amount of contribution elected is in addition to the 2% of pay deferred in the 401(k) Plan.) - ------------------------------------------------------------------------------------------------------------------------------------ SECTION 3 - INVESTMENT OPTIONS: Note - Following the reallocation of existing account balances in early 2000, you will not be able to move, in the future, any investments in ServiceMaster shares, whether related to past or future deferrals. - ------------------------------------------------------------------------------------------------------------------------------------ Current 2000 Investment (must be in 5% increments) Reallocation of Existing Investments I elect to have my existing account balances invested effective as soon as administratively (1) ServiceMaster shares - Note - you possible, as follows (only indicate if changes are will not be able to reallocate requested): investments out of ServiceMaster shares in the future. ______ (2) Index Trust 500 Portfolio ______ ______ (3) Intermediate Term Treasury ______ ______ (4) Wellington Fund ______ ______ (5) Fixed Income - Long-Term Corporate ______ ______ (6) Small Capitalization Stock Portfolio ______ ______ TOTAL 100% ______ 100% - ------------------------------------------------------------------------------------------------------------------------------------ SECTION 4 - ELECTION TO RECEIVE FUNDS: - ------------------------------------------------------------------------------------------------------------------------------------ Except for the elections made below, the amount deferred under the terms of this Agreement, including any interest and earnings, shall be distributed on __________ or in ___________ (number of) annual installments(s) beginning __________ (must be 1/1/2004 or later). Accounts will be valued either 12/31 or 6/30. To the extent my account is invested in ServiceMaster shares, I understand that I will receive ServiceMaster shares upon distribution. (Note - Any Company matching contributions are subject to vesting and any vested portion will not be distributed until separation of employment.) - ------------------------------------------------------------------------------------------------------------------------------------ 1 - ------------------------------------------------------------------------------------------------------------------------------------ SECTION 5 - TERMINATION: - ------------------------------------------------------------------------------------------------------------------------------------ In the event of termination (other than for death) before the end of any deferral period, I elect to receive my distribution on the following basis: ______________ under the terms of this Agreement as specified above, OR ______________ as soon as administratively possible following termination - ------------------------------------------------------------------------------------------------------------------------------------ SECTION 6 - DEATH: - ------------------------------------------------------------------------------------------------------------------------------------ In the event of death, I elect for my beneficiary(ies) to receive this distribution on the following basis: ______________ under the terms of this Agreement as specified above, OR ______________ as soon as administratively possible following death - ------------------------------------------------------------------------------------------------------------------------------------ SECTION 7 - CHOICE NOT TO PARTICIPATE: - ------------------------------------------------------------------------------------------------------------------------------------ ________ I choose NOT to participate in the ServiceMaster Deferred Compensation Plan at this time. - ------------------------------------------------------------------------------------------------------------------------------------ I have read and understand this enrollment form, as well as the other materials describing the ServiceMaster Deferred Compensation Plan and have indicated my choice above. Employee's Signature _______________________________ Date _________________ - ------------------------------------------------------------------------------------------------------------------------------------ 2
EX-4 4 0004.txt EMPLOYEE SHARE PURCHASE PLAN INTERNATIONAL TRUST SERVICEMASTER EMPLOYEE SHARE PURCHASE PLAN INTERNATIONAL TRUST SERVICEMASTER EMPLOYEE SHARE PURCHASE PLAN INTERNATIONAL TRUST TABLE OF CONTENTS
Page ARTICLE 1.........................................................................................................1 Introduction......................................................................................................1 1.1 Name and Grantor....................................................................................1 1.2 Purpose.............................................................................................2 1.3 Trust Beneficiaries.................................................................................2 ARTICLE 2.........................................................................................................2 Management, Control and Investment of Trust Fund Assets...................................................................................................2 2.1 The Trust Fund.......................................................................................2 2.2 Irrevocability.......................................................................................3 2.3 Investment Guidelines and Investment of Principal and Accumulated Income.....................................................................3 2.4 Exercise of Trustee's Duties.........................................................................3 2.5 Disposition of Income................................................................................3 2.6 General Powers.......................................................................................3 2.7 Purchases of Limited Partnership Units of the Company..............................................................................................5 ARTICLE 3.........................................................................................................5 Separate Beneficiary Accounts.....................................................................................5 ARTICLE 4.........................................................................................................6 Distribution of Trust Assets......................................................................................6 4.1 Distribution of Payments.............................................................................6 4.2 Reversion to the Company.............................................................................7 4.3 Insolvency...........................................................................................7 4.4 Benefits May Not Be Assigned or Alienated............................................................7 ARTICLE 5.........................................................................................................8 Tax Matters.......................................................................................................8 5.1 Nature of Trust.....................................................................................8 5.2 Federal and State Reporting Requirements With Respect to Distributions to Trust Beneficiaries.......................................................................................8 5.3 Taxation Prior to Receipt............................................................................8 i TABLE OF CONTENTS (Cont'd) ----------------- Page ARTICLE 6.........................................................................................................9 Compensation, Expenses and Liability..............................................................................9 6.1 Compensation and Expenses............................................................................9 6.2 Liability of Trustee.................................................................................9 6.3 Indemnification......................................................................................9 ARTICLE 7.........................................................................................................9 Changes of Trustee................................................................................................9 7.1 Resignation and Removal of Trustee...................................................................9 7.2 Appointment of Successor Trustee.....................................................................9 7.3 Duties of Resigned or Removed Trustee and of Successor Trustee...................................................................................10 7.4 Reports; Approval of Accounts.......................................................................10 ARTICLE 8........................................................................................................10 Amendment, Revocation and Termination............................................................................10 8.1 Amendment and Revocation............................................................................10 8.2 Termination of ESPP.................................................................................11 8.3 Termination of Trust................................................................................11 ARTICLE 9........................................................................................................11 Miscellaneous....................................................................................................11 9.1 Persons Dealing with Trustee Evidence...............................................................11 9.2 Evidence............................................................................................11 9.3 Notice and Waiver of Notice.........................................................................11 9.4 Counterparts........................................................................................11 9.5 Words of Gender.....................................................................................11 9.6 Governing Law.......................................................................................11 9.7 Successors, Etc.....................................................................................11 9.8 Severability........................................................................................12 9.9 Action by Company...................................................................................12
ii SERVICEMASTER EMPLOYEE SHARE PURCHASE PLAN INTERNATIONAL TRUST This Agreement is made as of the 1st day of January, 1992, (the "Effective Date"), by and between ServiceMaster Limited Partnership, a Delaware limited partnership or its subsidiaries (the "Company") and Gary-Wheaton Bank or its affiliates, an Illinois banking association, as trustee (the "Trustee"). W I T N E S S E T H: WHEREAS, the Company maintains the ServiceMaster Employee Share Purchase Plan (the "ESPP") for the benefit of its employees and the employees of the other members of its controlled group (as described in Section 414(b) and 414(c) of the Internal Revenue Code or 1986 (the "Code")) of which the Company is a member ("Controlled Group") and who have elected to participate in the ESPP; and WHEREAS, ServiceMaster Limited, a U.K. subsidiary of the Company became a participating employer in the ESPP effective as of July 1, 1991 and other international members of the Controlled Group may participate in the ESPP in the future ("international employers"); and WHEREAS, the Company desires to establish and maintain a trust (the "Trust") as an alternative means for the employees of the international employers to participate in the ESPP. NOW, THEREFORE, the parties do hereby establish the Trust and agree that the Trust shall be comprised, held and disposed of as follows: ARTICLE 1 Introduction 1.1 Name and Grantor. This Trust Agreement and Trust hereby evidenced shall be known as the "ServiceMaster Employee Share Purchase Plan International Trust." The grantor of the Trust shall be the individual employees of the Company who have contributions made to the Trust on their behalf pursuant to the ESPP. 1 1.2 Purpose. The Trust has been established by the Company for the purpose of holding the ESPP assets attributable to the employees of the international employers, including but not limited to ServiceMaster Limited, who participate in the ESPP and have directed the Company to make contributions to the Trust on their behalf pursuant to the terms of the ESPP. A distribution under the Trust to any Trust Beneficiary shall, for purposes of the ESPP, be deemed a distribution by the Company to such Trust Beneficiary. Notwithstanding the preceding, under circumstances described more fully in Section 4.3, the assets of the Trust shall be applied in partial or total satisfaction of claims of creditors of the Company in the event of the insolvency of the Company. 1.3 Trust Beneficiaries. Each employee of an international employer who is participating in the ESPP and on whose behalf a contribution has been made to the Trust and each other person (including any "Beneficiary") who may become entitled to Payments under such ESPP shall be a Trust Beneficiary under this Trust Agreement. ARTICLE 2 Management, Control and Investment of Trust Fund Assets 2.1 The Trust Fund. -------------- (a) As used in this section 2.1 and elsewhere in this Trust Agreement, the term "Trust Fund" means, as of any date, all property of every kind then held by the Trustee under this Trust Agreement. (b) Subject to the claims of its creditors, the Company may at anytime or from time to time make deposits of cash or other property with the Trustee, which amounts shall become the principal of the Trust to be held, administered and disposed of by the Trustee as provided in this Trust Agreement. (c) The principal of the Trust Fund and earnings thereon shall be held separate and apart from other funds of the Company and shall be used exclusively for the uses and purposes herein set forth. (d) Neither any Trust Beneficiary, nor the ESPP, shall have any preferred claim on, or any beneficial ownership interest in, any assets of the Trust Fund prior to the time such assets are distributed to such Trust Beneficiary as Payments as provided in Article 4, and all rights created under the ESPP and this Trust Agreement shall be mere unsecured contractual rights of the particular Trust Beneficiaries against the Company and are no greater than the rights of the other general unsecured creditors of the Company. 2 2.2 Irrevocability. The Trust shall be irrevocable. -------------- 2.3 Investment Guidelines and Investment of Principal and Accumulated Income. Unless the Trustee is otherwise directed by the Company, the Trustee shall invest the Trust Fund in accordance with the terms and conditions of the ESPP. 2.4 Exercise of Trustee's Duties. The Trustee shall discharge its duties hereunder with the care, skill, prudence and diligence under the circumstances then prevailing that a prudent man acting in a like capacity and familiar with such matters would use in the conduct of an enterprise of a like character and with like aims. Notwithstanding the foregoing, however, the Trustee shall incur no liability to anyone for any action taken with respect to investments within the contemplation of this Trust Agreement pursuant to Section 2.3 or pursuant to a written direction given by the Company and to that extent shall be relieved of the Prudent Man Rule for investments. 2.5 Disposition of Income. During the term of this Trust, all income received by the Trust, net of expenses, shall be accumulated and reinvested subject to the distribution provisions of Article 4 and Article 5. 2.6 General Powers. Subject to the provisions of sections 2.3 and 2.4, the Trustee shall have the following powers, rights and duties with respect to the Trust Fund in addition to those provided elsewhere in this Trust Agreement or by law: (a) In accordance with the intent of the ESPP that funds be invested primarily in limited partnership units of the Company, to invest and reinvest all assets of the Trust Fund in limited partnership units of the Company; (b) except as otherwise provided in subsection (a) above, to invest and reinvest part or all of the Trust Fundin any real or personal property; (c) to receive and hold all contributions paid to it under the ESPP except that the Trustee shall have no duty to require any contributions to be made, or to determine that any of the contributions received comply with the conditions and limitations of the ESPP; 3 (d) to deposit and invest any part or all of the Trust Fund in any common trust fund or other collective investment fund maintained by the Trustee for trust investment purposes; (e) to sell, contract to sell, convey, exchange, transfer and otherwise deal with all assets in the Trust Fund in such manner, for such considerations, and on such terms and conditions as the Trustee shall decide; (f) to retain in cash (pending investment, reinvestment or distribution of Payments) any reasonable portion of the Trust Fund and to deposit cash in any depository, including the banking department of the bank acting as Trustee; (g) to compromise, contest, arbitrate, settle or abandon claims and demands with respect to the Trust Fund; (h) to begin, maintain or defend any litigation necessary in connection with the administration of the Trust; (i) to have all rights of an individual owner with respect to assets in the Trust Fund, including the power to give proxies, to vote stocks or limited partnership shares, to join in or oppose (along or jointly with others) voting trusts, mergers, consolidations, foreclosures, reorganizations, recapitalization or liquidations, and to exercise or sell stock or a limited partnership share subscription or conversion rights; (j) to hold securities or other property in the name of the Trustee or any nominee or nominees of the Trustee, or in such other form as the Trustee shall determine, including corporate depositories, with or without disclosing the Trust relationship, provided that the records of the Trustee shall indicate the actual ownership of such securities or other property; (k) to participate in and use a book-entry system for the deposit and transfer of securities; (l) to retain any funds or property subject to any dispute without liability for the payment of interest, or to decline to make payment or delivery thereof until final adjudication is made by a court of competent jurisdiction; (m) to employ agents, attorneys, investment counsel, accountants or other persons for such purposes as the Trustee considers desirable in connection with the administration of the Trust; 4 (n) to furnish the Company with such information in the Trustee's possession as the Company may need for tax or other purposes; and (o) to perform any and all other acts which are, in the Trustee's judgment, necessary or appropriate for the proper and advantageous management, investment and distribution of the Trust fund in accordance with the terms of this Trust Agreement. 2.7 Purchases of Limited Partnership-Units of the Company. The Trustee may purchase limited partnership units of the Company ("shares") on the open market, by private purchase, from the Company or otherwise. Pursuant to the terms of the ESPP, in the event shares are purchased in a private purchase, the purchase price shall be no higher than the then prevailing market price on the New York Stock Exchange at the time of purchase. In the event of purchase from the Company, the purchase price will be the closing price for the shares on the New York Stock Exchange on the date of purchase. ARTICLE 3 Separate Beneficiary Accounts The Company shall maintain separate bookkeeping accounts with respect to each Trust Beneficiary and shall have the responsibility for doing the necessary accounting and maintaining the necessary records to determine the value of each Trust Beneficiary's account as of any given valuation date and the number of shares and cash held on his behalf . The accounts of the respective Trust Beneficiaries hereunder shall correspond to their respective accounts under the ESPP, and the Company's obligation to make investments with respect to each Trust Beneficiary account under the ESPP shall be discharged by the investment of each such Trust's Beneficiary account hereunder. It is also intended that the sum of the accounts of all the Trust Beneficiaries hereunder shall equal the value of the Trust Fund as of any periodic valuation date as agreed upon by the parties. 5 ARTICLE 4 Distribution of Trust Assets 4.1 Distribution of Payments. Subject to section 4.3 and the other provisions of this Article and subject to the provisions of Article 5, the Trustee shall distribute all or any portion of Trust Beneficiary's interest hereunder as directed by the Company ("Payments") provided that: (a) The Trustee shall make distributions of Payments to the Trust Beneficiaries from the assets of the Trust Fund, if and to the extent such assets are available therefor, as directed by the Company in accordance with the provisions of the ESPP, and such distribution may be in the form of cash or shares or a combination thereof, as directed by the Company. (b) If acting pursuant to a direction given by the Company, the Trustee shall have no responsibility to inquire as to whether the payee Trust Beneficiary is entitled to any distribution, or as to whether a distribution is proper, and shall have no liability for a distribution made in good faith without actual notice or knowledge of the changed condition or status of the payee Trust Beneficiary. (c) If any check for any distribution directed by the Company to be made from the Trust Fund was mailed by the Trustee, by regular United States mail, to the last address of the Trust Beneficiary furnished by the Company to the Trustee and is returned unclaimed, the Trustee shall notify the Company of that fact and ' shall redirect the distribution as directed by the Company. The Trustee shall not be required to search for or locate a Trust Beneficiary. (d) The Trustee may reserve such reasonable amount from any distribution as it shall deem necessary to pay any estate, inheritance, income or other tax, charge or assessment attributable to any distribution or may require such release or other document from any taxing authority and such indemnity from the Trust Beneficiary as the Trustee shall deem necessary for its protection. 6 4.2 Reversion to the Company. Subject to the provisions of section 4.3, the Company shall not have any right or power to direct the Trustee to return to the Company or to divert to others any of the Trust Fund assets before all distributions of Payments have been made to each Trust Beneficiary. 4.3 Insolvency. If at any time during the existence of this Trust the Trustee receives written notice certified by the Board of Directors of the Managing General Partner of the Company or a notice or order from a court of competent jurisdiction that the Company has become insolvent as defined under bankruptcy laws of any applicable jurisdiction, the Trustee shall immediately suspend the payment of all benefits from the Trust Fund and shall thereafter hold the Trust Fund in suspense until it receives a court order directing the disposition of the Trust Fund or until it receives written notice from the Company certified by the Board of Directors of the Managing General Partner that the Company has regained solvency. During the period of suspension of the Trust Fund, to the extent permitted by law, the Trustee may continue to pay out of the Trust Fund reasonable and necessary expenses of the Trust Fund, including fees of the Trustee, fees of any agents hired by the Trustee or the Company on behalf of the Trust Fund, and taxes. The Company shall be obligated to give the Trustee prompt written notice of an event of insolvency (or bankruptcy), and the Trustee shall be entitled to rely thereon and to pay all benefits in the absence of notice of insolvency as set forth herein. Notwithstanding the foregoing, the Trustee may in its sole discretion rely on any facts which constitute actual notice of the Company's insolvency. After the Trustee receives notice of Company solvency, which is certified by the Board of Directors of the Managing General Partner, the Trustee shall resume all its duties and responsibilities under this Agreement until and unless it again receives notice of the Company's insolvency. In the case of any individual who, at the time of a suspension of payment of benefits was receiving or who during the period of suspension became entitled to receive benefits, the Trustee may at the direction of the Company make such additional payments as required to compensate for the period of time during which payments were suspended. 4.4 Benefits May Not Be Assigned or Alienated. The interests ----------------------------------------- of a Trust Beneficiary under the Trust shall not be voluntarily or involuntarily assigned, alienated or encumbered. 7 ARTICLE 5 Tax Matters 5.1 Nature of Trust. This Trust Agreement is intended to constitute a grantor trust, as described in Section 671 of the Internal Revenue Code of 1986, as amended (the "Code") (and corresponding provisions of successor income tax laws) and shall be construed accordingly. The Trust is established for the benefit of the Trust Beneficiaries. However, neither the Trust Beneficiaries nor any future designated beneficiary of the Trust Beneficiaries shall have any right or security interest in any specific asset of the Trust, it being understood that the assets of the Trust shall be available for the claims of creditors of the Company in the event of bankruptcy or insolvency. 5.2 Federal and State Reporting Requirements With Respect to Distributions to Trust Beneficiaries. The Trustee shall withhold Federal, state and local taxes which are assessable on amounts paid to a Trust Beneficiary at such rate as may be determined by the Company. The Company's determination of the amount of withholding, either as the appropriate rate under applicable laws, or such larger amounts as may be requested by the Trust Beneficiary, shall be conclusive and may be relied on by the Trustee. The Trustee shall transmit the amount withheld to the Company, who shall transmit the amount withheld to the applicable taxing authority. The Trustee shall furnish to the Company, which shall transmit to the Trust Beneficiary all withholding and benefit payment information as soon as practicable after the end of each calendar year. The Company shall provide the Trustee with all necessary information in order for the Trustee to comply with this paragraph 5.2 5.3 Taxation Prior to Receipt. If the Company determines, based on evidence submitted to it by the Trust Beneficiary or any other reliable source, that the Trust Beneficiary is subject to Federal income taxation on any amounts held in the Trust for his benefit in a calendar year prior to the calendar year in which he would otherwise receive such benefits, the Company shall, at the written request of the Trust Beneficiary, notify the Trustee thereof, and the Company shall direct the Trustee to distribute the amount of the benefits determined to be taxable to the Trust Beneficiary as soon as practicable. 8 ARTICLE 6 Compensation, Expenses and Liability 6.1 Compensation and Expenses. All reasonable costs, charges and expenses incurred by the Trustee in connection with the administration of the Trust, including such reasonable compensation of the Trustee as may be agreed upon from time to time between the Company and the Trustee, shall be paid from the Trust Fund unless paid or advanced by the Company. The Trustee shall also pay such expenses in connection with the administration of the ESPP as may be directed by the Company and shall be fully protected in making such payments pursuant to directions of the Company. 6.2 Liability of Trustee. The Trustee shall not be liable for any act or failure to act under this Trust Agreement unless such action or failure to act was negligent, in bad faith or willful misconduct. In no event shall the Trustee be liable as a result of an investment decision made in accordance with a written request of the Company. 6.3 Indemnification. To the extent permitted by law and except as provided in paragraph 6.2, the Company hereby agrees to indemnify the Trustee for, and hold it harmless against, and defend it against any and all liabilities, losses, costs or expenses (including reasonable attorneys' fees) of whatsoever kind and nature which may be imposed on, incurred by or asserted against 'it at any time by reason of carrying out in good faith the responsibilities delegated to or directions given it under this Trust Agreement, or by reason of any act or failure to act under this Trust Agreement, except that no indemnification shall be made for any liability arising out of the Trustee's negligence, bad faith or willful misconduct. ARTICLE 7 Changes of Trustee 7.1 Resignation and Removal of Trustee. The Trustee may resign at any time by giving thirty days' advance written notice to the Company and the Company may remove a Trustee (or any successor Trustee) by giving thirty days' advance written notice to the Trustee (or any successor Trustee). 7.2 Appointment of Successor Trustee. In the event of the -------------------------------- resignation or removal of the Trustee, a successor Trustee shall be appointed by the Company as soon as possible. 9 7.3 Duties of Resigned or Removed Trustee and of Successor Trustee. If the Trustee resigns or is removed, such resigned or removed Trustee shall promptly transfer and deliver the Trust Fund to the successor Trustee. Within 120 days, the resigned or removed Trustee shall furnish to the Company and the successor Trustee an account of the administration of the Trust from the date of the last account with respect to the resigned or removed Trustee (showing all receipts, disbursements, distributions and other transactions and all investments and the values thereof) and any records or reports which the resigned or removed Trustee may possess which the Company may require to administer the ESPP. Each successor Trustee shall succeed to the title to the Trust Fund vested in its predecessor without the signing or filing of any further instrument, but any resigned or removed Trustee shall execute all documents and do all acts necessary to vest such title of record in any successor Trustee. Each successor Trustee shall have all the powers, rights and duties conferred by this Trust Agreement as if originally named as Trustee. No successor Trustee shall be personally liable for any act or failure to act of a predecessor Trustee. 7.4 Reports: Approval of Accounts. The Trustee shall periodically furnish to the Company written reports showing all investments of the Trust Fund and its value and all receipts, disbursements, distributions and other transactions that have occurred during the reporting period and other relevant information with respect to the Trust Fund. All accounts, books and records with respect to the Trust Fund shall be open to inspection and audit at all reasonable times by representatives of the Company. The account of the Trustee may be approved by any Company by written notice delivered to the Trustee or by failure to object to the account by written notice delivered to the Trustee within twelve months of the date upon which the account was delivered to the Company. The approval of an account shall constitute a full and complete discharge of the Trust by the Company as to all matters set forth in that account as if the account had been settled by a court of competent jurisdiction in an action or proceeding to which the Company and the Trustee were parties. In no event shall the Trustee be precluded from having its accounts settled by judicial proceeding. ARTICLE 8 Amendment, Revocation and Termination 8.1 Amendment and Revocation. This Trust Agreement may be amended from time to time by the Company, except to make the Trust revocable or to alter section 8.3 of this Article. 10 8.2 Termination of ESPP. If the ESPP is terminated, all of the provisions of the Trust evidenced by this Trust Agreement, as applied to the ESPP, nevertheless shall continue in effect until the entire Trust Fund has been distributed by the Trustee. 8.3 Termination of Trust. The trust shall not terminate until the date on which no Trust Beneficiary is entitled to any additional Payments. ARTICLE 9 Miscellaneous 9.1 Persons Dealing with Trustee. No person dealing with the Trustee shall be required to see to the application of any money paid or property delivered to the Trustee, or to determine whether or not the Trustee is acting pursuant to any authority granted under this Trust Agreement. 9.2 Evidence. Evidence required of anyone under this Trust Agreement may be by certificate, affidavit, document or other instrument which the person acting in reliance thereon considers pertinent and reliable, and signed, made or presented by the proper party. 9.3 Notice and Wavier of Notice. Any notice or document required to be filed under this Trust Agreement will be property filed if delivered or mailed by registered mail, postage prepaid, and: (i) if to the Company, in care of the Secretary at the Company's principal business office and (ii) if to the Trustee, at its principal business office. Any notice required under this Trust Agreement may be waived by the person entitled thereto. 9.4 Counterparts. This Trust Agreement may be executed in any number of counterparts each of which shall be deemed an original, and no other counterpart need be produced. 9.5 Words of Gender. Words of the masculine gender may, and where necessary shall, be construed as denoting the feminine gender. 9.6 Governing Law. This Trust Agreement shall be construed and administered according to the laws of the State of Illinois. 9.7 Successors. The provisions of this Trust Agreement shall be binding on and inure to the benefit of the Trustee and any successor Trustee and upon the Company and any successor of the Company which shall acquire directly or indirectly by merger, consolidation, purchase or otherwise all or substantially all of the assets, business or stock of the Company. 11 9.8 Severability. Any provision of this Trust Agreement prohibited by law shall be ineffective to the extent of any such prohibition without invalidating the remaining provisions hereof. 9.9 Action by Company. Any action taken by the Company in accordance with the terms of this Trust Agreement should be by resolution of the Board of Directors of the Managing General Partner of the Company, or by any person or persons authorized by resolution of such Board of Directors. IN WITNESS WHEREOF, the Company and the Trustee have caused this Trust Agreement to be signed and attested to by their duly authorized officers the day and year first above written. SERVICEMASTER LIMITED PARTNERSHIP GARY-WHEATON BANK, as By SERVICEMASTER MANAGEMENT Trustee CORPORATION By: ____________________ By: _______________________ Its: _________________ Its: __________________ 12 EX-5 5 0005.txt OPINION OF COUNSEL AND CONSENT EXHIBIT 5 January 3, 2001 The ServiceMaster Company One ServiceMaster Way Downers Grove, IL 60515 Re: 750,000 shares of common stock ("Common Stock") under the 1998 Non-Employee Directors Discounted Stock Option Plan (the "Directors Plan") and $15,000,000 of deferred compensation obligations under the ServiceMaster Deferred Compensation Plan (the "Deferred Compensation Plan")(together, the "Plans"). Ladies and Gentlemen: I am General Counsel for The ServiceMaster Company, a Delaware corporation ("ServiceMaster"), and have acted as counsel for ServiceMaster in connection with the preparation and filing of a Registration Statement on Form S-8 (the "Registration Statement") under the Securities Act of 1933 (the "Securities Act") relating to (i) the registration of 750,000 shares of Common Stock to be offered and sold to ServiceMaster non-employee directors under the Directors Plan and (ii) up to $15,000,000 of (1) ServiceMaster's deferred compensation obligations (the "Deferred Compensation Obligations") and (2) Common Stock, in each case payable under the Deferred Compensation Plan. To render the opinions expressed below, I have reviewed the Directors Plan, the Deferred Compensation Plan, and the Registration Statement. I have also examined originals, or copies of originals certified or otherwise identified to my satisfaction, of ServiceMaster's corporate records and of such other agreements, documents, instruments and certificates of public officials, officers and representatives of ServiceMaster and other persons, have examined such questions of law and have satisfied myself as to such matters of fact as I have deemed relevant and necessary as a basis for the opinions expressed herein. I have assumed the authenticity of all documents submitted to me as originals, the genuineness of all signatures, the legal capacity of all natural persons and the conformity with the original documents of any copies thereof submitted to me for my examination. Based upon the foregoing, I am of the opinion that: 1. ServiceMaster is duly incorporated and validly existing under the laws of the State of Delaware. 1 2. If ServiceMaster's Board of Directors or a duly authorized committee thereof authorizes the issuance of authorized and unissued shares of Common Stock for the consideration provided in the Plans, such shares will, when certificates representing such shares have been duly executed, countersigned and registered and duly delivered against the receipt by ServiceMaster of the consideration provided in the Plans, be legally issued, fully paid and non-assessable. 3. The Deferred Compensation Obligations will be, when created in accordance with the terms of the Deferred Compensation Plan, valid and binding obligations of ServiceMaster, enforceable in accordance with the terms of the Deferred Compensation Plan, subject to applicable bankruptcy, moratorium, insolvency, fraudulent transfer, reorganization and other laws of general applicability relating to or affecting creditors' rights and to general equitable principles. The foregoing opinions are limited to the laws of the State of Illinois and Delaware General Corporation Law. I express no opinion as to the application of the securities or blue sky laws of the various states to the issuance or sale of shares of Common Stock or the Deferred Compensation Obligations. I hereby consent to the filing of this opinion letter as an exhibit to the Registration Statement. Very truly yours, The ServiceMaster Company /s/ Jim L. Kaput Jim L. Kaput General Counsel 2 EX-23 6 0006.txt CONSENT OF ARTHUR ANDERSEN LLP EXHIBIT 23.1 Arthur Andersen CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS As independent public accountants, we hereby consent to the incorporation by reference in this Form S-8 registration statement of our report dated January 24, 2000 incorporated by reference in The ServiceMaster Company's Form 10-K for the year December 31, 1999 and to all references to our Firm included in this registration statement. /s/ Arthur Andersen LLP ARTHUR ANDERSEN LLP Chicago, Illinois January 3, 2001 EX-24 7 0007.txt POWER OF ATTORNEY EXHIBIT 24 Power of Attorney I hereby appoint each of Jim L. Kaput or Steven C. Preston or Eric R. Zarnikow or any other person occupying the office of General Counsel, Chief Financial Officer, or Treasurer with The ServiceMaster Company ("ServiceMaster") at the time any action hereby authorized shall be taken to act as my attorney-in-fact and agent for all purposes specified in this Power of Attorney. I hereby authorize each person identified by name or office in the preceding sentence (each of whom is herein called my "authorized representative") acting alone to sign and file on my behalf in all capacities I may at any time have with ServiceMaster (including but not limited to the position of director or any officer position) the registration statement prepared under the Securities Act of 1933 identified in this Power of Attorney and any amendment to any such registration statement. I hereby authorize each authorized representative in my name and on my behalf to execute every document and take every other action which such authorized representative deems necessary or desirable in connection with the registration statement identified in this Power of Attorney and any sale of securities or other transaction accomplished by means of any such registration statement. This Power of Attorney applies to a registration statement on Form S-8 that registers common stock to be offered and sold pursuant to the ServiceMaster Employee Share Purchase Plan, the ServiceMaster Employee Share Purchase Plan International Trust, The ServiceMaster Company 1998 Non-Employee Directors Discounted Stock Option Plan and ServiceMaster's obligations under the ServiceMaster Deferred Compensation Plan. This instrument shall remain in effect until the earlier to occur of (i) my cessation of service as a director and officer of ServiceMaster and (ii) my giving written notice to ServiceMaster's Chairman and Chief Executive Officer, General Counsel, Chief Financial Officer or Treasurer of my election to revoke this instrument. No such revocation shall be effective to revoke the authority for any action taken pursuant to this Power of Attorney prior to such cessation of service or delivery of revocation. 1 The law of the State of Illinois shall govern this instrument. Dated: September 29, 2000 /s/ Paul W. Berezny, Jr. - ----------------------------------------------------- Paul W. Berezny, Jr. /s/ Carlos H. Cantu - ----------------------------------------------------- Carlos H. Cantu /s/ Brian Griffiths - ----------------------------------------------------- Brian Griffiths /s/ Sidney E. Harris - ----------------------------------------------------- Sidney E. Harris /s/ Glenda A. Hatchett - ----------------------------------------------------- Glenda A. Hatchett /s/ Herbert P. Hess - ----------------------------------------------------- Herbert P. Hess /s/ Michele M. Hunt - ----------------------------------------------------- Michele M. Hunt /s/ Gunther H. Knoedler - ----------------------------------------------------- Gunther H. Knoedler /s/ James D. McLennan - ----------------------------------------------------- James D. McLennan /s/ Vincent C. Nelson - ----------------------------------------------------- Vincent C. Nelson /s/ Dallen W. Peterson - ----------------------------------------------------- Dallen W. Peterson /s/ C. William Pollard - ----------------------------------------------------- C. William Pollard /s/ Donald G. Soderquist - ----------------------------------------------------- Donald G. Soderquist /s/ Charles W. Stair - ----------------------------------------------------- Charles W. Stair /s/ David K. Wessner - ----------------------------------------------------- David K. Wessner 2 -----END PRIVACY-ENHANCED MESSAGE-----