As filed with the Securities and Exchange Commission on September 25 , 1998
Registration No. 333-_____
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-3
REGISTRATION STATEMENT
Under
The Securities Act of 1933
The ServiceMaster Company
(Exact name of registrant as specified in its charter)
Delaware One ServiceMaster Way 36-3858106
(State or other Downers Grove, Illinois 60515 (I.R.S. Employer
jurisdiction of (630) 271-1300 Identification No.)
incorporation or (Address, including zip code,
organization) and telephone number,
including area code, of
Registrant's principal
executive offices)
Vernon T. Squires, Esq.
Senior Vice President and General Counsel
The ServiceMaster Company
One ServiceMaster Way
Downers Grove, Illinois 60515-1700
(630) 271-1300
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
Copies of all communications, including communications sent to
agent for service, should be sent to:
Robert H. Kinderman, Esq. Alexander P. Fraser, Esq.
Kirkland & Ellis Michael Best & Friedrich LLP
200 East Randolph Drive 100 East Wisconsin Avenue
Chicago, Illinois 60601 Milwaukee, Wisconsin 53202-4108
(312) 861-2000 (414) 271-6560
Approximate date of commencement of proposed sale to the public: As
soon as practicable after the effectiveness of this Registration Statement.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, check the following box.___
If any of the securities being registered on this Form are to be
offered on a delayed or continuous basis pursuant to Rule 415 under the
Securities Act of 1933, other than securities offered only in connection with
dividend or interest investment plans, check the following box._X_
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement of the same offering.___
If this Form is a post-effective amendment filed pursuant to Rule
462(c) under the Securities Act, please check the following box and list the
Securities Act registration statement number of the earlier effective
registration statement for the same offering.___
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box.___
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
=========================================================================================================================
<S> <C> <C> <C> <C>
Amount to Proposed Maximum Proposed Maximum Amount of
be Offering Price Aggregate Registration
Title of Each Class of Securities to be Registered Registered Per Unit (1) Offering Price Fee
- -------------------------------------------------------------------------------------------------------------------------
Common Stock, par value $.01 per share, and related 538,313 $21.44 $11,541,431 $3,405
Preferred Stock Purchase Rights . . . . . . . . . .
======================================================----------------------------------------------------===============
</TABLE>
(1) Reflects the average of the high and low prices on the New York Stock
Exchange Composite Tape on September 21, 1998, pursuant to Rule 457(c)
under the Securities Act of 1933, as amended.
(2) The value attributable to the Preferred Stock Purchase Rights is reflected
in the value attributable to the Common Stock.
The registrant hereby amends this Registration Statement on such date
or dates as may be necessary to delay its effective date until the registrant
shall file a further amendment which specifically states that this Registration
Statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until this Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
<PAGE>
Information contained herein is subject to completion or amendment. A
registration statement relating to these securities has been filed with the
Securities and Exchange Commission. These securities may not be sold nor may
offers to buy be accepted prior to the time the registration statement becomes
effective. This prospectus shall not constitute an offer to sell or the
solicitation of an offer to buy nor shall there be any sale of these securities
in any state in which such offer, solicitation or sale would be unlawful prior
to registration or qualification under the securities laws of any such state.
SUBJECT TO COMPLETION, DATED SEPTEMBER 25,1998
PROSPECTUS 538,313 Shares
The ServiceMaster Company
Common Stock
(par value $.01 per share)
The 538,313 shares of common stock, par value $.01 per share (the
"Common Stock"), together with the Preferred Stock Purchase Rights (the
"Rights"), offered to the public hereby (collectively, the "Shares") are
outstanding shares of The ServiceMaster Company, a Delaware corporation
("ServiceMaster" or the "Company"), that may be sold from time to time by the
Selling Stockholders as set forth under "Selling Stockholders." The Company will
not receive any part of the proceeds from the sale of the Shares. See "Use of
Proceeds."
The Common Stock is traded on the New York Stock Exchange (the "NYSE")
under the symbol "SVM." On September 23, 1998, the last reported closing price
for the Common Stock (as reported on the NYSE Composite Tape) was 21-5/8 per
Share.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR
HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE
SECURITIES COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION
TO THE CONTRARY IS A CRIMINAL OFFENSE.
The Company has agreed to pay the cost of the registration of the
Shares and the preparation of this Prospectus and Registration Statement under
which it is filed. The expenses so payable by the Company are estimated to be
approximately $45,000.
The Company has been advised that sales of the Shares may be made from
time to time by or for the account of the Selling Stockholders on the NYSE, in
the over-the-counter market, in private transactions, through broker-dealers or
otherwise. Any such sales will be made either at fixed prices, at market prices
prevailing at the time of sale, at varying prices determined at the time of sale
or at negotiated prices. Any broker-dealer may either act as agent for the
Selling Stockholders or may purchase any of the Shares as principal and
thereafter may sell such Shares from time to time in transactions on the NYSE or
in the over-the-counter market at prices prevailing at the time of sale or at
negotiated prices. See "Plan of Distribution."
The date of this Prospectus is September __, 1998.
1
<PAGE>
AVAILABLE INFORMATION
ServiceMaster is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in
accordance therewith, files reports, proxy statements and other information with
the Securities and Exchange Commission (the "Commission"). Such reports, proxy
statements and other information filed by the Company and its predecessors may
be inspected and copied at the public reference facilities of the Commission
located at 450 Fifth Street, N.W., Washington, D.C. 20549, and at the
Commission's regional offices located at 7 World Trade Center, Suite 1300, New
York, New York 10048, and Citicorp Center, 500 West Madison Street, Suite 1400,
Chicago, Illinois 60661. Copies of such material can also be obtained at
prescribed rates from the Public Reference Section of the Commission at Room
1024, 450 Fifth Street, N.W., Washington, D.C. 20549. Such materials and other
information concerning the Company and its predecessors are also filed
electronically with the Commission and are accessible via the World Wide Web at
http://www.sec.gov. The Common Stock is traded on the New York Stock Exchange
(the "NYSE"), and reports and other information concerning the Company and its
predecessors can also be inspected at the offices of the NYSE, 20 Broad Street,
New York, New York 10005.
The Company has filed with the Commission a registration statement on
Form S-3 (together with all amendments and exhibits thereto, the "Registration
Statement") under the Securities Act of 1933, as amended (the "Securities Act"),
with respect to the Common Stock offered hereby. This Prospectus does not
contain all of the information set forth in the Registration Statement, certain
parts of which have been omitted in accordance with the rules and regulations of
the Commission. Statements contained in this Prospectus as to the contents of
any contract or other document referred to are not necessarily complete and, in
each instance, reference is made to the copy of such contract or other document
filed as an exhibit or incorporated by reference to the Registration Statement
of which this Prospectus forms a part, each such statement being qualified in
all respects by such reference. For further information with respect to the
Company and the Common Stock offered hereby, reference is made to the
Registration Statement and the exhibits and schedules thereto. Copies of the
Registration Statement and the exhibits and schedules thereto may be inspected,
without charge, at the offices of the Commission, or obtained at prescribed
rates from the Public Reference Section of the Commission at 450 Fifth Street,
N.W., Washington, D.C. 20549.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed by the Company (File No. 1-14762) with
the Commission are hereby incorporated by reference in this Prospectus:
(1) The Company's Annual Report on Form 10-K for the fiscal year ended December
31, 1997;
(2) The Company's Quarterly Reports on Form 10-Q for the quarterly periods
ended March 31, 1998 and June 30, 1998; and
(3) The Company's Current Report on Form 8-K, dated April 21, 1998.
All documents filed by the Company with the Commission pursuant to
Section 13(a), 13(c), 14 or 15(d) of the Exchange Act, after the date of this
Prospectus and prior to the termination of the offering covered by this
Prospectus shall be deemed to be incorporated by reference into this Prospectus
and to be a part hereof from the date of filing of such documents. Any statement
contained herein or in any document incorporated or deemed to be incorporated by
reference herein shall be deemed to be modified or superseded for purposes of
this Prospectus 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 statement so
modified or superseded shall not be deemed, except as so modified or superseded,
to constitute a part of this Prospectus.
2
<PAGE>
The Company will provide, without charge to each person to whom this
Prospectus is delivered, upon written or oral request of such person, a copy of
any and all of the information that has been or may be incorporated by reference
in this Prospectus, other than exhibits to such documents (unless such exhibits
are specifically incorporated by reference into such documents). Such requests
should be directed to: The ServiceMaster Company, One ServiceMaster Way, Downers
Grove, Illinois 60515-1700, Attention: Secretary, telephone (630) 271-1300.
SPECIAL NOTE ON FORWARD-LOOKING STATEMENTS
This Prospectus contains or incorporates by reference certain
forward-looking statements within the meaning of Section 27A of the Securities
Act and Section 21E of the Exchange Act and the Company intends that such
forward-looking statements be subject to the safe harbors created thereby. Such
forward-looking statements involve risks and uncertainties and include, but are
not limited to, statements regarding future events and the Company's plans,
goals and objectives. Such statements are generally accompanied by words such as
"intend," "anticipate," "believe," "estimate," "expect" or similar statements.
The Company's actual results may differ materially from such statements. Factors
that could cause or contribute to such differences are set forth below as well
as those factors discussed elsewhere in this Prospectus and in the documents
incorporated herein by reference. Although the Company believes that the
assumptions underlying its forward-looking statements are reasonable, any of the
assumptions could prove inaccurate and, therefore, there can be no assurance
that the results contemplated in such forward-looking statements will be
realized. The inclusion of such forward-looking information should not be
regarded as a representation by the Company or any other person that the future
events, plans or expectations contemplated by the Company will be achieved.
Seasonality and Impact of Weather Conditions. The Company's lawn care
and pest control businesses are highly seasonal in nature, with a significant
portion of their net revenues occurring in the spring and summer months of each
year. Adverse weather conditions can have a negative impact on the demand for
the Company's lawn care and pest control services.
Increased Competition. The service industries in which the Company
operates are highly competitive with limited barriers to entry. The entry of new
competitors into one or more of the markets served by the Company could impact
the demand for the Company's services as well as impose additional pricing
pressures.
Labor Shortages. Most of the services provided by the Company are
highly labor intensive. In the event of a labor shortage, the Company may
experience difficulty in delivering its services in a high-quality manner and
may be forced to increase wages in order to attract a sufficient number of
employees, which could result in higher operating costs for the Company.
Continued Consolidation of the U.S. Hospital Market. In recent years,
there has been an on-going consolidation of hospitals in the healthcare market.
This continued consolidation could adversely impact the level of demand for the
Company's healthcare management services and the prices for which the Company
can charge for such services.
Fluctuations in the General Economy. Demand for the Company's services
is significantly affected by the general level of economic activity in the
United States. In an economic downturn, the demand for the Company's services
may decrease and the Company may face pricing pressure from its customers and
increased competition from other companies.
Ability to Continue Acquisition Strategy. The Company plans to continue
to pursue opportunities to expand through acquisitions. The Company's ability to
continue to make strategic acquisitions at reasonable prices and to integrate
the acquired businesses are important factors in the Company's future growth.
3
<PAGE>
THE COMPANY
ServiceMaster is one of the largest providers of residential and
supportive management services to individual consumers, businesses and
institutions in the United States. In addition, the Company has operations in 38
countries around the world. The Company operates primarily through two units:
ServiceMaster Consumer Services ("ServiceMaster Consumer Services"), and
ServiceMaster Management Services ("ServiceMaster Management Services"). The
Company also has recently formed a third unit, ServiceMaster Employer Services
("ServiceMaster Employer Services").
ServiceMaster Consumer Services provides services to over 9.6 million
residential and commercial customers (as of June 30, 1998) under eight
market-leading brand names:
TruGreen-ChemLawn for lawn, tree and shrub care and commercial
landscape and indoor plant maintenance;
Terminix for termite and pest control services;
American Home Shield and AmeriSpec for home system and appliance
warranty contracts and home inspection services;
Rescue Rooter for plumbing and drain cleaning services;
ServiceMaster Residential/Commercial Services for heavy-duty
residential and commercial cleaning and
disaster restoration services;
Merry Maids for residential maid services; and
Furniture Medic for on-site furniture repair and restoration
services.
These services comprise the "ServiceMaster Quality Service Network" and may be
accessed easily by calling a single toll-free telephone number: 1-800-WE SERVE.
ServiceMaster Management Services provides facilities management
services to over 2,000 customers (as of June 30, 1998) in the health care,
education, and business and industrial markets. These services include plant
operations and maintenance, housekeeping, grounds and landscaping, clinical
equipment management, energy management, food service, laundry and linen
services, total facilities management and other services. The Company
historically has provided these services through three principal operating
units: Healthcare Services, Education Management Services and Business &
Industry Group.
ServiceMaster Employer Services is one of the nation's ten largest
professional employer organizations and provides a full-range of support in
human resource services, including administrative processing of payroll,
worker's compensation insurance, health insurance, unemployment insurance and
other employee benefits, to approximately 800 customers with over 19,000 leased
employees (as of June 30, 1998).
The principal executive offices of ServiceMaster are located at One
ServiceMaster Way, Downers Grove, Illinois 60515-1700 and its telephone number
is (630) 271-1300. The Company maintains a website on the Internet at
http://www.ServiceMaster.com. The Company's website and the information
contained therein are not a part of this Prospectus. Unless otherwise indicated
or the context otherwise requires, all references herein to the "Company" or
"ServiceMaster" refer to The ServiceMaster Company, a Delaware corporation, and
its subsidiaries and their respective predecessors.
4
<PAGE>
RECENT DEVELOPMENTS
On July 28, 1998, the Board of Directors of ServiceMaster approved a
three-for-two share split effective on August 26, 1998 for shareholders of
record on August 12, 1998. The share and per share amounts referenced herein
have been adjusted to reflect the stock split.
USE OF PROCEEDS
The Selling Stockholders will receive all of the proceeds from any sale
of the Shares.
SELLING STOCKHOLDERS
The Shares covered by this Prospectus are being offered by or for the
account of the Selling Stockholders listed in the table below (the "Selling
Stockholders"). On May 14, 1998, the Company acquired the business and
substantially all of the assets of Cal-Western Termite and Pest Control Company,
Inc., a California corporation in exchange for an aggregate of 397,165 shares of
Common Stock. On June 11, 1998, the Company acquired the business and
substantially all of the assets of Ted Shackelford & Associates, Inc., an Ohio
corporation, and T&K, Inc., a North Carolina corporation (the "Shackelford
Corporations") in exchange for an aggregate of 141,148 of shares of Common Stock
(collectively, the "Shackelford Acquisition"). Until the Shackelford
Acquisition, each of the Shackelford Corporations was a franchisee of Barefoot
Grass Lawn Service in the state of North Carolina. The Company acquired
Barefoot, Inc., the franchisor of Barefoot Grass Lawn Service, on February 24,
1997. Concurrently with the Shackelford Acquisition, the Company issued an
aggregate of 7,434 shares of Common Stock in equal amounts to Ted Shackelford
and Karen Shackelford, respectively, as consideration for each of their
respective agreements not to compete with the Company. Shortly after the
Shackelford Acquisition, the shares of Common Stock held by the Shackelford
Corporations were distributed to Ted and Karen Shackelford, the shareholders of
the Shackelford Corporations, in a complete liquidation of the Shackelford
Corporations. None of the Selling Stockholders or any of their affiliates has
had within the past three years any material relationship with the Company or
any of its affiliates, except as described above and except, in the case of Ted
and Karen Shackelford, as a result of their respective stock ownership of, and
positions with, the Shackelford Corporations.
The following table sets forth certain information as of August 31,
1998 with respect to the shares of Common Stock held by each Selling
Stockholder:
<TABLE>
<CAPTION>
Shares Beneficially Shares
Owned Prior to Number Beneficially Owned
Offering of Shares After
----------------- Being Offered Offering
Selling Stockholders Number Percent Number Percent
<S> <C> <C> <C> <C> <C>
Cal-Western Termite and Pest Control Company, Inc. 397,165 0 397,165 -- --
Ted Shackelford 70,575 * 70,575 -- --
Karen Shackelford 70,573 * 70,573 -- --
</TABLE>
* Less than one percent
5
<PAGE>
DESCRIPTION OF CAPITAL STOCK
Under the Company's Amended and Restated Certificate of Incorporation
(the "Restated Certificate"), the Company is authorized to issue 1,000,000,000
shares of Common Stock, par value $0.01 per share, and 11,000,000 shares of
preferred stock, par value $0.01 per share (the "Preferred Stock"). As of August
31, 1998, 296,603,940 shares of Common Stock (excluding treasury shares) were
issued and outstanding and no shares of Preferred Stock were issued and
outstanding. In addition, as of August 31, 1998, the Company had 11,250,000
shares of Common Stock reserved for issuance under the Company's equity
incentive plans of which approximately 3,240,000 were subject to outstanding
stock options. The number of authorized shares of Preferred Stock includes
1,000,000 authorized shares of Junior Participating Preferred Stock, Series A
(the "Series A Preferred Stock") issuable pursuant to the rights agreement dated
as of December 15, 1997 between the Company and Harris Trust and Savings Bank
(the "Rights Plan"), none of which were outstanding as of August 31, 1998. See
"--Stock Purchase Rights."
Common Stock
Subject to the rights of the holders of any Preferred Stock, each
holder of Common Stock on the applicable record date is entitled to receive such
dividends as may be declared by the Board of Directors out of funds legally
available therefor, and, in the event of liquidation, to share pro rata in any
distribution of the Company's assets after payment of liabilities. Each holder
of Common Stock is entitled to one vote for each share held of record on the
applicable record date on all matters presented to a vote of stockholders. The
outstanding Common Stock is, and the shares of Common Stock offered hereby by
the Company will be, fully paid and non-assessable.
Harris Trust and Savings Bank of Chicago, Illinois is the registrar and
transfer agent for the Common Stock.
Stock Purchase Rights
Each outstanding share of Common Stock includes, and each share of
Common Stock offered hereby will include, one preferred stock purchase right
(individually a "Right" and collectively the "Rights") provided under the Rights
Plan. Each Right entitles the holder, until the earlier of December 11, 2007 or
the redemption of the Rights, to buy one one-thousandth of a share of Series A
Preferred Stock at a price of $130 per one one-thousandth of a share (as may be
adjusted to reflect stock splits since the issuance of the Rights). The Series A
Preferred Stock is nonredeemable and will have 1,000 votes per share (subject to
adjustment). The Company has reserved 1,000,000 shares of Series A Preferred
Stock for issuance upon exercise of such Rights.
In the event that any person becomes the beneficial owner of 15% or
more of the Company's Common Stock, the Rights (other than Rights held by the
acquiring stockholder) would become exercisable for that number of shares of the
Common Stock having a market value of two times the exercise price of the Right.
Furthermore, if after any person becomes the beneficial owner of more than 15%
or more of the Company's Common Stock, the Company is acquired in a merger or
other business combination or 50% or more of its assets or earnings power were
sold, each Right (other than Rights held by the acquiring person) would become
exercisable for that number of shares of Common Stock (or securities of the
surviving company in a business combination) having a market value of two times
the exercise price of the Right.
The Company may redeem the Rights at one cent per Right prior to the
occurrence of an event that causes the Rights to become exercisable for Common
Stock. The Board of Directors may terminate the Company's right to redeem the
Rights under certain circumstances at any time after a group or person acquires
15% or more of the Common Stock.
6
<PAGE>
One Right will be issued in respect of each share of Common Stock
issued before the earlier of December 11, 2007 or the redemption of the Rights.
As of the date of this Prospectus, the Rights are not exercisable, certificates
representing the Rights have not been issued and the Rights automatically trade
with the shares of Common Stock. The Rights will expire on December 11, 2007,
unless earlier redeemed.
Preferred Stock
Shares of Preferred Stock may be issued from time to time in one or
more series. The Board is authorized to determine and alter all rights,
preferences and privileges and qualifications, limitations and restrictions
thereof (including, without limitation, voting rights and the limitation and
exclusion thereof) granted to or imposed upon any wholly unissued series of
Preferred Stock and the number of shares constituting any such series and the
designation thereof, to determine whether fractional shares can be issued in any
particular series and, if so, the nature of the fractional interests which can
be issued in that series, and to increase or decrease (but not below the number
of shares of such series then outstanding) the number of shares of any series
subsequent to the issue of shares of that series then outstanding. In case the
number of shares of any series is so decreased, the shares constituting such
reduction shall resume the status which such shares had prior to the adoption of
the resolution originally fixing the number of shares of such series.
Certain Provisions of the Restated Certificate and By-Laws
The following summary of certain provisions of the Restated Certificate
and By-Laws of the Company (the "By-Laws") does not purport to be complete and
is subject to and qualified in its entirety by reference to the Restated
Certificate and the By-Laws, which are incorporated by reference as exhibits to
the Registration Statement of which this Prospectus is a part.
Classification of Directors. The Company's Restated Certificate and
By-Laws provide that its Board of Directors shall be divided into three classes,
each class being as nearly equal in number as reasonably practicable, and that
at each annual meeting of the Company's stockholders, the successors to the
Directors whose terms expire that year shall be elected for a term of three
years. The number of Directors is fixed by the affirmative vote of the majority
of the Directors then in office, but may not be less than three. Newly created
Directorships and any vacancies on the Board of Directors are filled by a
majority vote of the remaining Directors then in office, even if less than a
quorum. Except in certain limited circumstances, no Director may be removed from
the Board prior to the time such person's term would expire unless (i) such
removal is for cause and (ii) such removal has been approved by the affirmative
vote of the holders of 67% of the outstanding voting shares of the Company. The
Restated Certificate requires that a majority of the members of the Board be
"independent directors," which is defined to generally include any person (i)
who is not and has not been employed by any ServiceMaster unit within one year;
(ii) is not a "Related Person" (as hereinafter defined) and has not been
employed by a Related Person within one year; (iii) is not a party to any
agreement, requirement or arrangement under which such person may be obligated
to act in his or her capacity as a Director in accordance with instructions
provided by any person who is not independent (including, but not limited to, a
Related Person); and (iv) is not subject to any relationship, arrangement or
circumstance (including any relationship with a Related Person) which, in the
judgment of a majority of the independent Directors (the "Independent Board
Majority") is reasonably possible will interfere with such person's exercise of
independent judgment as a Director.
Special Meetings. The By-Laws provide that stockholder action can be
taken only at an annual or special meeting of stockholders and cannot be taken
by written consent in lieu of a meeting. The By-Laws provide that, except as
otherwise required by law, special meetings of the stockholders can only be
called pursuant to a resolution adopted by a majority of the Board of Directors.
Stockholders are not permitted to call a special meeting or to require the Board
to call a special meeting.
7
<PAGE>
Approval of Certain Business Combinations. The Restated Certificate
provides that the affirmative vote of the holders of not less than 80% of the
outstanding shares of the Common Stock held by stockholders other than a
"Related Person" (any person or entity which, together with its affiliates and
associates, beneficially owns in the aggregate 15% or more of the outstanding
Common Stock and any affiliate or associate of such person or entity) is
required for the approval or authorization of any "Business Combination" (as
hereinafter defined) of the Company with any Related Person; provided, that the
foregoing 80% voting requirement is not applicable if an "Independent Board
Majority" (a majority of the group comprised of all individuals who are
independent sitting directors) either (a) has expressly approved in advance the
acquisition of the outstanding shares of Common Stock that caused such Related
Person to become a Related Person or (b) has expressly approved such Business
Combination either in advance of or subsequent to such Related Person's having
become a Related Person. The term "Business Combination" is defined under the
Restated Certificate to mean (a) any merger or consolidation of the Company or a
subsidiary of the Company with or into a Related Person; (b) any sale, lease,
exchange, transfer or other disposition of all or any substantial part (as
defined in the Restated Certificate) of the assets either of the Company
(including without limitation any voting securities of a subsidiary) or of a
subsidiary of the Company to a Related Person; (c) any merger or consolidation
of a Related Person with or into the Company or a subsidiary of the Company; (d)
any sale, lease, exchange, transfer or other disposition of all or any
substantial part of the assets of a Related Person to the Company or a
subsidiary of the Company; (e) the issuance of any securities of the Company or
a subsidiary of the Company to a Related Person; (f) any recapitalization that
would have the effect of increasing the voting power of a Related Person; and
(g) any agreement, contract or other arrangement providing for any of the
transactions described in this definition of a Business Combination.
Action By Written Consent. The By-Laws provide that a holder of Common
Stock or any other class of stock at any time issued by the Company shall not
have the right to take action by written consent. Rather, stockholders shall
only have the right to act with respect to any particular issue at a meeting of
stockholders at which that issue is properly up for a vote by stockholders.
Stockholder Proposals. Stockholders are only entitled to make proposals
to be voted upon by stockholders at an annual meeting if they comply with
certain procedures set forth in the By-Laws, which require, among other things,
that the proposing stockholder must deliver a written notice identifying such
proposal to the office of the Company's General Counsel at the Company's
headquarters no later than the close of business on the 60th day nor earlier
than the close of business on the 90th day prior to the first anniversary of the
preceding year's annual meeting; provided, however, that if the date of the
annual meeting is more than 30 days before or more than 60 days after such
anniversary date, notice by the stockholder to be timely must be so delivered
not earlier than the close of business on the 90th day prior to such annual
meeting and not later than the close of business on the later of the 60th day
prior to such annual meeting or the 10th day following the day on which public
announcement of the date of such meeting is first made by the Company. At a
special stockholders meeting, a stockholder's proposal will be timely for that
meeting if it is actually delivered to the General Counsel's office at the
Company's headquarters no later than the close of business on the 10th day
following the day on which the Company first publicly announced the date of the
special meeting and that a vote by stockholders will be taken at that meeting.
Such stockholder's proposal notice must: (i) contain a description of the
proposal, the reasons for the proposal and any material interest in such
proposal by the proposing stockholder or the beneficial owner of the
stockholder's record shares; (ii) contain an affirmation by the proposing
stockholder that the stockholder satisfies the requirements specified in the
By-Laws for presentation of such proposal; and (iii) as to the stockholder
making the proposal and the beneficial owner, if any, on whose behalf the
proposal is made (x) the name and address of such stockholder, as they appear on
the Company's books, and of such beneficial owner and the telephone number at
which each may be reached during normal business hours through the time for
which the meeting is scheduled and (y) the class and number of shares of the
Company which are owned beneficially and of record by such stockholder and such
beneficial owner.
Amendments to the Restated Certificate. The Restated Certificate
provides that no change in the Restated Certificate shall be effective unless it
shall have been approved by at least 80% of the Company's sitting directors and
shall have received such other approvals as may have been required by the
Company's By-Laws or by applicable law.
8
<PAGE>
Certain Anti-Takeover Provisions of Delaware Law
The Company is a Delaware corporation and is subject to Section 203 of
the Delaware General Corporation Law. In general, Section 203 prevents an
"interested stockholder" (defined generally as a person owning 15% or more of
the Company's outstanding voting stock) from engaging in a "business
combination" (as defined in Section 203) with the Company (or its majority-owned
subsidiaries) for three years following the time such person became an
interested stockholder unless: (i) before such person became an interested
stockholder, the Company's Board of Directors approved the transaction in which
the interested stockholder became an interested stockholder or approved the
business combination; (ii) upon consummation of the transaction that resulted in
the interested stockholder becoming an interested stockholder, the interested
stockholder owns at least 85% of the Company's voting stock outstanding at the
time the transaction commenced (excluding stock held by directors who are also
officers of the Company and by employee stock plans that do not provide
employees with the rights to determine confidentially whether shares held
subject to the plan will be tendered in a tender or exchange offer); or (iii) at
or following the transaction in which such person became an interested
stockholder, the business combination is approved by the Company's Board of
Directors and approved at a meeting of stockholders by the Affirmative vote of
the holders of at least two-thirds of the Company's outstanding voting stock not
owned by the interested stockholder. Under Section 203, the restrictions
described above also do not apply to certain business combinations proposed by
an interested stockholder following the earlier of the announcement or
notification of one of certain extraordinary transactions involving the Company
and a person who had not been an interested stockholder during the previous
three years or who became an interested stockholder with the approval of a
majority of the Company's directors, if such extraordinary transaction is
approved or not opposed by a majority of the directors who were directors prior
to any person becoming an interested stockholder during the previous three years
or were recommended for election or elected to succeed such directors by a
majority of such directors.
PLAN OF DISTRIBUTION
The Shares may be sold from time to time to purchasers directly by the
Selling Stockholders. Alternatively, the Selling Stockholders may from time to
time offer the Shares to or through underwriters, broker-dealers or agents, who
may receive compensation in the form of underwriting discounts, concessions or
commissions from the Selling Stockholders or the purchasers of such securities
for whom they may act as agents. The Selling Stockholders and any underwriters,
broker-dealers or agents that participate in the distribution of the Shares may
be deemed to be "underwriters" within the meaning of the Securities Act and any
profit on the sale of such securities and any discounts, commissions,
concessions or other compensation received by any such underwriter,
broker-dealer or agent may be deemed to be underwriting discounts and
commissions under the Securities Act. The Shares may be sold from time to time
in one or more transactions at fixed prices, at prevailing market prices at the
time of sale, at varying prices determined at the time of sale or at negotiated
prices. The sale of the Shares may be effected in transactions (which may
involve crosses or block transactions) (i) on any national securities exchange
or quotation service on which the Shares may be listed or quoted at the time of
sale, (ii) in the over-the-counter market or (iii) otherwise than on such
exchanges or in the over-the-counter market. To comply with the securities laws
of certain jurisdictions, if applicable, the Shares will be offered or sold in
such jurisdictions only through registered or licensed brokers or dealers. In
addition, in certain jurisdictions the Shares may not be offered or sold unless
they have been registered or qualified for sale in such jurisdictions or any
exemption from registration or qualification is available and is complied with.
The Selling Stockholders will be subject to applicable provisions of
the Exchange Act and the rules and regulations thereunder, which provisions may
limit the timing of purchases and sales of any of the Shares by the Selling
Stockholders. The foregoing may affect the marketability of such securities.
9
<PAGE>
The Selling Stockholders will be indemnified by the Company against
certain liabilities, including certain liabilities under the Securities Act, or
will be entitled to contribution in connection therewith. The Company will be
indemnified by the Selling Stockholders against certain liabilities arising from
or related to the information provided by such Selling Stockholders for use
herein, including certain liabilities under the Securities Act, or will be
entitled to contribution in connection therewith.
The Company has agreed to pay the cost of the registration of the
Shares and the preparation of this Prospectus and Registration Statement under
which it is filed. The expenses so payable by the Company are estimated to be
approximately $45,000.
LEGAL MATTERS
Certain legal matters regarding the Shares being offered hereby have
been passed upon by Vernon T. Squires, Senior Vice President and General
Counsel. As of August 31, 1998, Mr. Squires held directly 337,947 shares of
Common Stock and indirectly through an investment partnership 61,189 shares of
Common Stock and options to purchase an aggregate of 135,000 shares of Common
Stock.
EXPERTS
The financial statements and schedule of the Company incorporated by
reference in this Prospectus and elsewhere in the Registration Statement have
been audited by Arthur Andersen LLP, independent public accountants, as
indicated in their reports with respect thereto, and incorporated by reference
in reliance upon the authority of said firm as experts in giving said reports.
10
<PAGE>
No person has been authorized to give any information or to make any
representations other than those contained in this Prospectus, and, if given
or made, such information or representations must not be relied upon as having
been authorized. This Prospectus does not constitute an offer to sell or the
solicitation of an offer to buy any securities other than the securities to
which it relates or an offer to sell or the solicitation of an offer to buy
such securities in any circumstances in which such offer or solicitation is
unlawful. Neither the delivery of this Prospectus nor any sale made hereunder
shall, under any circumstances, create an implication that there has been no
change in the affairs of the Company since the date hereof or that the
information contained herein is correct as of any time subsequent to its date.
---------------
538,313 Shares
The ServiceMaster Company
Common Stock
(par value $.01 per share)
TABLE OF CONTENTS
Page
Available Information 2
Incorporation of Certain Documents
by Reference 2
Special Note on Forward-looking
Statements 3
The Company 4
Recent Developments 5
Use of Proceeds 5
Selling Stockholders 5
Description of Capital Stock 6
Plan of Distribution 9
Legal Matters 10
Experts 10
---------------
PROSPECTUS
---------------
September __, 1998
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. Other Expenses of Issuance and Distribution.
The estimated expenses in connection with the issuance and distribution
of the securities being registered, other than underwriting compensation, are:
SEC Registration Fee $3,405
NYSE Listing Fee 1,605
Legal Fees and Expenses 25,000
Accounting Fees and Expenses 5,000
Printing and Engraving Fees 5,000
Miscellaneous 4,990
-----
Total $45,000
*Actual. All other amounts are estimated.
ITEM 15. Indemnification of Directors and Officers of the Company.
The ServiceMaster Company (the "Company") is incorporated under the
laws of the State of Delaware. Section 145 of the DGCL, inter alia ("Section
145") provides that a Delaware corporation may indemnify any persons who were,
are or are threatened to be made, parties to any threatened, pending or
completed action, suit or proceeding, whether civil, criminal, administrative or
investigative (other than an action by or in the right of such corporation), by
reason of the fact that such person is or was an officer, director, employee or
agent of such corporation, or is or was serving at the request of such
corporation as a director, officer, employee or agent of another corporation or
enterprise. The indemnity may include expenses (including attorneys' fees),
judgments, fines and amounts paid in settlement actually and reasonably incurred
by such person in connection with such action, suit or proceeding, provided such
person acted in good faith and in a manner he reasonably believed to be in or
not opposed to the corporation's best interests and, with respect to any
criminal action or proceeding, had no reasonable cause to believe that his
conduct was illegal. A Delaware corporation may indemnify any persons who are,
were or are threatened to be made, a party to any threatened, pending or
completed action or suit by or in the right of the corporation by reason of the
fact that such person was a director, officer, employee or agent of such
corporation, or is or was serving at the request of such corporation as a
director, officer, employee or agent of another corporation or enterprise. The
indemnity may include expenses (including attorneys' fees) actually and
reasonably incurred by such person in connection with the defense or settlement
of such action or suit, provided such person acted in good faith and in a manner
he reasonably believed to be in or not opposed to the corporation's best
interests, provided that no indemnification is permitted without judicial
approval if the officer, director, employee or agent is adjudged to be liable to
the corporation. Where an officer, director, employee or agent is successful on
the merits or otherwise in the defense of any action referred to above, the
corporation must indemnify him against the expenses that such officer or
director has actually and reasonably incurred.
Article Ten of the Restated Certificate ("Article Ten") provides that
no person shall have any liability of any kind by reason of a Relevant Loss
(defined below) caused in whole or in part by any act or failure to act which
occurred while such person was an officer or director of the Company except: (i)
obligations arising under the express terms of any written contract to which
such person is a party; (ii) the obligation to return to the Company an amount
up to the value actually realized by such person by stealing or by any other
action which constitutes a criminal felony; (iii) any liability imposed by
contract or applicable law which is founded on, arises from or is related to
activities by such person (or such person's agents or affiliates) which are in
competition with any business of the Company or any of its affiliates; and (iv)
any other liability from which it shall not be possible to exempt such person
under applicable law
1
<PAGE>
either as constituted on the date on which the Restated
Certificate was filed with the Secretary of State of Delaware (the "Filing
Date") or at any time thereafter. The term "Relevant Loss" designates and
includes any loss, damage or expense of any kind (i) experienced for any reason
by the Company or by any entity controlled by the Company; (ii) which any person
may experience by reason of any purchase (or failure to purchase), maintenance
of an interest in, sale (or failure to sell) or failure to obtain payment of any
amount due on any note, debenture, preferred stock, common stock or other
security issued or issuable by the Company or (iii) which shall otherwise be
caused in whole or in part by or arise in connection with (or would not have
occurred but for) such person's service as a director or officer of the Company.
In addition, Article Ten provides that every director of the Company shall be
exempt (except to the extent expressly set forth therein) from any personal
liability to the Company or any of the Company's stockholders for monetary
damages for breach of fiduciary duty as a director to the fullest extent
permitted by (i) Section 102(b)(7) of the DGCL as constituted on the Filing Date
or (ii) any provision of the law of the State of Delaware as constituted at any
time after the December 11, 1991.
Except as otherwise provided in the Restated Certificate, Article
Eleven of the Restated Certificate ("Article Eleven") provides that the Company
shall indemnify any person against, and shall reimburse such person for any
amount which such person shall pay to satisfy, settle or otherwise deal with,
any attempt to impose any liability or obligation of any kind upon such person
if such attempt or such liability or obligation or both shall arise in
connection with or by reason of, or would not have arisen but for, Covered
Service by such person (or any agreement by such person to serve as a director
or officer of the Company or to provide other Covered Service) including, but
not limited to: (i) any claim resulting from any loss, injury, damage, harm or
other disadvantage which the Company, any affiliate, any employee plan or any
person who acquires, holds, or disposes of any interest in any security issued
by the Company suffers or is alleged to have suffered; (ii) any claim resulting
from any act or failure to act by any person which is (or is alleged to be)
beyond the scope of his or her authority, contrary to instructions or orders or
contrary to his or her duties or applicable law; and (iii) any attempt by any
governmental authority or other person to impose any fine or penalty or to
obtain any other recovery by reason of any actual or alleged breach of any law
or other governmental requirement.
The term "Covered Service" designates and includes: (a) service as a
director or officer of the Company; (b) service by a person while he or she is
an officer or director of the Company (i) as an agent or representative of the
Company, (ii) in any other capacity with the Company, (iii) as a director,
officer, employee, agent or representative of, or in any other capacity with,
any affiliate, (iv) in any capacity with any Employee Plan (as defined therein),
and (v) in any other capacity in which such person shall have been asked to
serve by the Company's Board of Directors or Chief Executive Officer; (c) any
services which constituted "Covered Service" under the Amended and Restated
Agreement of Limited Partnership for ServiceMaster Limited Partnership; and (d)
any other service of any kind by any person with any organization or entity of
any kind (whether or not affiliated with the Company) which shall be designated
in writing as Covered Service by a majority of the members of the Company's
Board of Directors or by the Company's Chief Executive Officer. Service is
deemed to constitute "Covered Service" if it is so designated by the terms in
the preceding sentence regardless of whether it shall have been performed prior
to, at, or after the time Article Eleven became part of the Company's
Certificate of Incorporation. Any person is entitled to rely upon any written
confirmation provided by the Company's Chief Executive Officer or by the
Company's Board of Directors that service by such person in any capacity
specified in such confirmation will constitute Covered Service and to rely upon
the protection afforded by Article Eleven in connection with such service.
Except to the extent the Company shall otherwise expressly agree in
writing, the Company is not obligated under Article Eleven to reimburse any
person for or otherwise indemnify any person against: (a) any obligation the
person may have under any written contract except to the extent such obligation
arises by reason of any action taken by such person to satisfy, settle or
otherwise deal with any claim against which such person is entitled to
indemnification from the Company under Article Eleven or otherwise; (b) any
income taxes payable by reason of salary, bonus or other income or gain actually
realized by such person in connection with any Covered Service; (c) any
liability imposed by contract or applicable law which is founded on, arises from
or is related to activities by such person (or such person's agents or
2
<PAGE>
affiliates) which are in competition with any business of the Company or any of
its affiliates; and (d) any obligation to pay an amount up to the value
personally realized by such person by stealing or by any other action which
constitutes a criminal felony. Except as otherwise provided in the Restated
Certificate, the Company is not obligated under Article Eleven to indemnify any
person in connection with a proceeding (or part thereof) initiated by such
person unless such proceeding (or part thereof) was authorized by the Board of
Directors of the Company.
Article Eleven provides that each person who was or is made a party or
is threatened to be made a party to or is otherwise involved in any action, suit
or proceeding, whether civil, criminal, administrative or investigative, by
reason of the fact that he or she is or was a director or officer of the
Company, agreed to serve as a director or officer of the Company or is or was
providing any other Covered Service, whether the basis of such proceeding is
alleged action in an official capacity as a director or officer of the Company
or in any other Covered Service position, shall, except as otherwise provided
therein, be indemnified and held harmless by the Company to the fullest extent
authorized by Delaware law against all expense, liability and loss (including
attorneys' fees, judgments, fines, excise taxes or penalties arising under the
Employee Retirement Income Security Act as amended from time to time and amounts
paid in settlement) reasonably incurred or suffered by such person in connection
therewith and such indemnification shall continue as to a person who has ceased
to be a director or officer of the Company or to provide any other Covered
Service and shall inure to the heirs, executors and administrators of such
person.
Article Eleven provides that the Company shall reimburse any Covered
Person (as defined therein) for any payment made by such person for any legal
fees or other expenses reasonably incurred by such person in order to
investigate, evaluate, defend against, pay in full, settle or otherwise deal
with (i) any Covered Claim (as defined therein) or (ii) any development or state
of facts which could give rise to a Covered Claim.
Article Eleven also provides that any officer of the Company or any
member of its Board of Directors shall have the right and power to execute on
behalf of the Company any written contract with any other person providing
indemnification or other protection to such other person in connection with
service by such other person as a director or officer of the Company or in
connection with any other Covered Service by such person, and any such contract
shall be legal, valid and binding upon the Company and shall be enforceable
against the Company in accordance with its terms to the maximum extent permitted
by Article Eleven or by applicable law, if it shall be approved by a majority of
the members of the Company's Board of Directors exclusive of the person to whom
indemnification is provided by such contract. The rights of any person under any
particular contract made in accordance with the provisions of the preceding
sentence shall not be impaired or eliminated (i) by reason of the fact that all
or any one or more of the members of the Board who approved such contracts shall
be parties to contracts affording them similar protection (regardless of when
those other contracts shall have been approved or signed) or shall otherwise
have been provided with protection similar to that provided in the particular
contract or shall be subject to the same claims against which the particular
contract is intended to protect or (ii) for any other reason whatsoever. It is
expressly intended that each person with whom the Company shall enter into a
written contract to provide indemnification or other protection in connection
with such person's service as an officer or director of the Company or in
connection with other Covered Service by such person shall be entitled to rely
upon (and shall conclusively be presumed to have relied upon) the rights which
such contract purports to provide to such person. No separate written contract
shall however be necessary in order for any person to obtain any indemnification
or payment to which Article Eleven purports to entitle such person, and any
Covered Person who has no separate contact of any kind with the Company shall be
entitled to receive all indemnification, payments and other benefits which the
provisions in Article Eleven purport to provide to such Covered Person.
The rights to indemnification and payment provided by Article Eleven
are not exclusive of any other right of any kind which any person may have or at
any time acquire under or by reason of any other provision in the Restated
Certificate, the Company's By-Laws, any agreement, any law or other action by
any governmental authority, or otherwise.
3
<PAGE>
Article Eleven authorizes the Company to purchase and maintain
insurance on behalf of any person who is or was a director or officer of the
Company, or is or was serving in any other capacity with the Company, any
Employee Plan or any other organization against any expense, liability or loss
whether or not the Company would have the power to indemnify such person against
such expense, liability or loss under the provisions of Article Eleven, under
applicable law or otherwise.
In addition, Section 145 further authorizes a corporation to purchase
and maintain insurance on behalf of any person who is or was a director,
officer, employee or agent of the corporation, or is or was serving at the
request of the corporation as a director, officer, employee or agent of another
corporation or enterprise, against any liability asserted against him and
incurred by him in any such capacity, arising out of his status as such, whether
or not the corporation would otherwise have the power to indemnify him under
Section 145.
All of the Company's directors and the officers are covered by
insurance policies maintained and held in effect by the Company against certain
liabilities for actions taken in such capacities, including liabilities under
the Securities Act of 1933.
ITEM 16. Exhibits. The following exhibits are filed herewith:
<TABLE>
<CAPTION>
<C> <S>
Exhibit No. Description of Exhibit
4.1 Amended and Restated Certificate of Incorporation of the Company.(1)
4.2 By-Laws of the Company.(1)
4.3 Specimen certificate representing the Common Stock.(2)
4.4 Rights Agreement, dated as of December 15, 1997, between
the Company and Harris Trust and Savings Bank, as trustee
(including form of rights certificate).(1)
4.5 Certificate of Designation, Preferences and Rights of Junior Participating
Preferred Stock, Series A.(1)
5.1 Opinion of Vernon T. Squires.
23.1 Consent of Vernon T. Squires (included in Exhibit 5.1).
23.2 Consent of Arthur Andersen LLP.
24.1 Power of Attorney.
- -----------------------
(1) Incorporated by reference to the Company's Current Report on Form 8-K, dated December 19,1997.
(2) Incorporated by reference to Exhibit 4.3 of the Company's Registration Statement on Form S-3
(Registration No. 333-49707).
</TABLE>
4
<PAGE>
ITEM 17. Undertakings.
The undersigned registrant hereby undertakes:
1. To file, during any period in which offers or sales are being made,
a post-effective amendment to this registration statement:
(a) To include any prospectus required by Section 10(a)(3)
of the Securities Act;
(b) 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;
(c) 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 1(a) and 1(b) 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 by the registrant pursuant to Section 13 or
15(d) of the Exchange Act that are incorporated by reference in the registration
statement;
2. That, for the purpose of determining any liability under the
Securities Act, 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.
3. To remove from registration by means of a post- effective amendment
any of the securities being registered which remain unsold at the termination of
the offering.
4. That, for purposes of determining any liability under the Securities
Act, each filing of the registrant's annual report pursuant to Section 13(a) or
15(d) of the Exchange Act, 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.
5. Insofar as indemnification for liabilities arising under the
Securities Act 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 SEC such indemnification
is against public policy as expressed in the Securities 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 Securities Act and will be governed by the final
adjudication of such issue.
6. The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
registrant's annual report pursuant to section 13(a) or section 15(d) of the
Exchange Act (and, where applicable, each filing of an employee benefit plan's
annual report pursuant to section 15(d) of the Exchange Act 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.
5
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Company
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in Downers Grove, Illinois, on the day of September 25, 1998.
The ServiceMaster Company, As Registrant
By: /S/ VERNON T. SQUIRES
---------------------------
Vernon T. Squires
Senior Vice President
and General Counsel
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed on September 23, 1998 by the following
persons in the capacities indicated:
<TABLE>
<CAPTION>
Signature Title
<C> <S>
* Chairman and Director of The ServiceMaster Company
C. William Pollard
* President, Chief Executive Officer and Director of The ServiceMaster
Carlos H. Cantu Company
* Vice Chairman and Director of The ServiceMaster Company
Charles W. Stair
* Vice Chairman and Director of The ServiceMaster Company
Phillip B. Rooney
* Director of The ServiceMaster Company
Paul W. Berezny, Jr.
* Director of The ServiceMaster Company
Henry O. Boswell
* Director of The ServiceMaster Company
Brian Griffiths
* Director of The ServiceMaster Company
Sidney E. Harris
* Director of The ServiceMaster Company
Herbert P. Hess
* Director of The ServiceMaster Company
Michele M. Hunt
* Director of The ServiceMaster Company
Gunther H. Knoedler
* Director of The ServiceMaster Company
James D. McLennan
* Director of The ServiceMaster Company
Vincent C. Nelson
* Director of The ServiceMaster Company
Dallen W. Peterson
* Director of The ServiceMaster Company
Steven S Reinemund
* Director of The ServiceMaster Company
Burton E. Sorensen
* Director of The ServiceMaster Company
David K. Wessner
</TABLE>
*The undersigned, by signing his name hereto, does sign and execute this
Registration Statement pursuant to the Powers of Attorney executed by the
above-named officers and directors of The ServiceMaster Company and filed
with the Securities and Exchange Commission on behalf of such officers
and directors.
By: /S/ VERNON T. SQUIRES Dated: September 25, 1998
----------------------------------------------
Vernon T. Squires
Attorney-in-Fact
6
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT INDEX
Sequential
Exhibit Page
Number Document Description Number
<C> <S>
4.1 Amended and Restated Certificate of Incorporation of the Company.(1)
4.2 By-Laws of the Company.(1)
4.3 Specimen certificate representing the
Common Stock. (2)
4.4 Rights Agreement, dated as of December 15, 1997, between the Company
and Harris Trust and Savings Bank, as trustee (including form of
rights certificate).(1)
4.5 Certificate of Designation, Preferences and Rights of Junior
Participating Preferred Stock, Series A.(1)
5.1 Opinion of Vernon T. Squires.
23.1 Consent of Vernon T. Squires (included in Exhibit 5.1).
23.2 Consent of Arthur Andersen LLP.
24.1 Power of Attorney.
- -------------------
(1) Incorporated by reference to the Company's Current Report on Form 8-K, dated December 19,1997.
(2) Incorporated by reference to Exhibit 4.3 of the Company's Registration Statement on Form S-3
(Registration No. 333-49707).
7
</TABLE>
Exhibit 5.1
[Letterhead of ServiceMaster]
September 25, 1998
The ServiceMaster Company
One ServiceMaster Way
Downers Grove, Illinois 60515-1700
Re: Registration of Shares of Common Stock
on Form S-3 Under the Securities Act of 1933
Ladies and Gentlemen:
I am Senior Vice President and General Counsel of The ServiceMaster
Company, a Delaware corporation (the "Company"). In that capacity, I have
participated in the preparation of, and I am familiar with the contents of the
Registration Statement on Form S-3 of the Company (the "Registration
Statement"), which is concurrently being filed with the Securities and Exchange
Commission, which registers under the Securities Act of 1933 (the "Securities
Act") the resale of up to 538,313 shares of common stock, par value $.01 per
share (the "Common Stock") of the Company (the "Shares").
I have reviewed such records and documents as I have deemed necessary
in order to enable me to express the opinions stated herein.
On the basis of the foregoing and subject to the limitations and
assumptions identified in this letter, I am of the opinion that:
1. The Company is a corporation validly existing and in good
standing under the Delaware General Corporation Law.
2. The Shares are duly authorized, validly issued, fully paid and
nonassessable.
All of my opinions assume that the Registration Statement will become
effective under the Securities Act before any Shares covered by the Registration
Statement are sold. I have also made other assumptions which I believe to be
appropriate for purposes of this letter.
My advice on every legal issue addressed in this letter is based
exclusively on the internal law of Illinois, the Delaware General Corporation
Law, or the federal law of the United States. This letter does not cover any law
which in my experience would generally not be considered by lawyers in Illinois
for purposes of the opinions contained in this letter. Without limiting by
1
<PAGE>
implication the generality of the preceding sentence, this opinion does not
cover the securities laws of the state of Illinois or any other jurisdiction.
This opinion and consent may be incorporated by reference in a subsequent
registration on Form S-3 filed pursuant to Rule 462(b) under the Securities Act
with respect to the registration of additional shares of Common Stock for
resale.
I hereby consent to the inclusion of this letter as an exhibit to the
Registration Statement and to the reference in each Prospectus included as part
of the Registration Statement to my having issued the opinions expressed herein.
Very truly yours,
/s/ Vernon T. Squires
Vernon T. Squires
Senior Vice President and General Counsel
2
Exhibit 23.2
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the use of our
reports (and to all references to our Firm) included in or made a part of this
registration statement.
/s/ ARTHUR ANDERSEN LLP
Arthur Andersen LLP
Chicago, Illinois
September 25, 1998
Exhibit 24.1
Power of Attorney
ServiceMaster S-3 Registration Statement
I hereby appoint each of Vernon T. Squires or Steven C. Preston or Eric R.
Zarnikow or Susan D. Baker or any other person occupying the office of General
Counsel, Chief Financial Officer, Treasurer, or Secretary 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 by "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 officership position) all or any one or more of the
registration statements prepared under the Securities Act of 1933 identified in
this Power of Attorney and any pre-effective or post-effective 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 any of the registration statements 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 the following registration statements
which may be filed by ServiceMaster under the Securities Act of 1933: (i) a
registration statement registering common stock to be sold by ServiceMaster in
one or more public offerings, and (ii) a registration statement registering
common stock to be sold by ServiceMaster stockholders in one or more public
offerings. At the discretion of ServiceMaster's President and Chief Executive
Officer, the registration of the common stock cited in clauses (i) and (ii) of
the preceding sentence may be made by means of separate registration statements
or a single registration statement.
This instrument shall remain in effect until and unless I shall give
written notice to ServiceMaster's President and Chief Executive Officer or
ServiceMaster's General Counsel or ServiceMaster's Chief Financial Officer 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 delivery of such revocation.
This instrument shall be governed by the law of the State of Illinois.
Dated: July 24, 1998
Signature Title
/S/ C. William Pollard
Chairman and Director of The ServiceMaster Company
C. William Pollard
/S/ Carlos H. Cantu
President, Chief Executive Officer and
Carlos H. Cantu Director of The ServiceMaster Company
1
<PAGE>
/S/ Charles W. Stair
Vice Chairman and Director of The
Charles W. Stair ServiceMaster Company
/S/ Phillip B. Rooney
Vice Chairman and Director of The
Phillip B. Rooney ServiceMaster Company
/S/ Paul W. Berezny, Jr.
Director of The ServiceMaster Company
Paul W. Berezny, Jr.
/S/ Henry O. Boswell
Director of The ServiceMaster Company
Henry O. Boswell
/S/ Brian Griffiths
Director of The ServiceMaster Company
Brian Griffiths
/S/ Sidney E. Harris
Director of The ServiceMaster Company
Sidney E. Harris
/S/ Herbert P. Hess
Director of The ServiceMaster Company
Herbert P. Hess
/S/ Michele M. Hunt
Director of The ServiceMaster Company
Michele M. Hunt
/S/ Gunther H. Knoedler
Director of The ServiceMaster Company
Gunther H. Knoedler
/S/ James D. McLennan
Director of The ServiceMaster Company
James D. McLennan
/S/ Vincent C. Nelson
Director of The ServiceMaster Company
Vincent C. Nelson
/S/ Dallen W. Peterson
Director of The ServiceMaster Company
Dallen W. Peterson
/S/ Steven S. Reinemund
Director of The ServiceMaster Company
Steven S Reinemund
/S/ Burton E. Sorensen
Director of The ServiceMaster Company
Burton E. Sorensen
/S/ David K. Wessner
Director of The ServiceMaster Company
David K. Wessner
2
