As filed with the Securities and Exchange Commission on August 31, 1999
Registration No. 333-_____
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-3
REGISTRATION STATEMENT
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, and telephone number,
organization) 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 S. Osborne, PC
Kirkland & Ellis
200 East Randolph Drive
Chicago, Illinois 60601
(312) 861-2000
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
=========================================================================================================================
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
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, par value $.01 per share, and related 87,627 $16,313 $1,429,459 $397.39
Preferred Stock Purchase Rights
=========================================================================================================================
</TABLE>
(1) Reflects the average of the high and low prices on the New York Stock
Exchange Composite Tape on August 26, 1999, 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>
================================================================================
<TABLE>
<CAPTION>
87,627 Shares
THE SERVICEMASTER COMPANY
Common Stock
(par value $0.01 per share)
<S> <C>
The 87,627 shares of Common Stock of The This Prospectus provides you with detailed information
ServiceMaster Company which are offered to the about ServiceMaster. We encourage you to read this
public by this Prospectus (the "Shares") are shares entire document carefully. In addition, you may obtain
that may be sold from time to time by the person information about ServiceMaster from documents that we
identified below as the "Selling Stockholder". have filed with the Securities and Exchange Commission.
ServiceMaster will not receive any part of the
proceeds from the sale of the Shares. This Prospectus is dated [_____, 1999]. You should be
aware that the delivery of this Prospectus and the sale
The Common Stock is listed on the New York Stock of Common Stock pursuant to this Prospectus will not in
Exchange, Inc. under the symbol "SVM". On August any way create an implication that the information
26, 1999, the closing sale price of the Common contained in this Prospectus is accurate or complete at
Stock on the NYSE was $16.313 per share. any time after [_______], 1999.
We are not making an offer of Common Stock in any state
where such an offer is not permitted.
</TABLE>
------------------------------------------------------
Neither the SEC nor any state securities regulators
have approved or disapproved the Common Stock to be
sold under this Prospectus or determined if this
Prospectus is accurate or adequate. Any
representation to the contrary is a criminal offense.
------------------------------------------------------
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<PAGE>
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and special reports, proxy statements and
other information with the SEC. You may read and copy any reports, statements or
other information we filed at the public reference facilities of the SEC at 450
Fifth Street, N.W., Washington, D.C. 20549, and at the Regional Offices of the
SEC at Seven World Trade Center, New York, New York 10048 and Citicorp Center,
500 West Madison Street, Chicago, Illinois 60661-2511. Please call the SEC at
1-800-SEC-0330 for further information on the public reference rooms. Our SEC
filings are also available to the public from commercial document retrieval
services and at the web site maintained by the SEC at http://www.sec.gov.
Our Common Stock is traded on the New York Stock Exchange, Inc. (the
"NYSE") under the symbol "SVM". You can inspect our reports and other
information at the offices of the NYSE, 20 Broad Street, New York, New York
10005.
ServiceMaster filed a Registration Statement on Form S-3 to register
with the SEC the Common Stock offered by this Prospectus. As allowed by SEC
rules, this Prospectus does not contain all the information you can find in the
Registration Statement or the exhibits to the Registration Statement.
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<PAGE>
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 into this Prospectus:
(1) The Company's Annual Report on Form 10-K for the fiscal year ended December
31, 1998;
(2) The Company's Quarterly Reports on Form 10-Q for the three-month period
ended March 31, 1999 and the three-month period ended June 30, 1999;
(3) The Company's Current Reports on Form 8-K, filed August 16, 1999, July 28,
1999, April 27, 1999, March 18, 1999, March 16, 1999, January 26, 1999 and
January 6, 1999; and
(4) The Company's Proxy Statement dated March 23, 1999.
All documents which we file with the SEC 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 from the date of
filing of such documents. Any statement contained in this Prospectus or in any
document incorporated or deemed to be incorporated by reference in this
Prospectus shall be deemed to be modified or superseded for purposes of this
Prospectus to the extent that a statement contained in this Prospectus or in any
other subsequently filed document which also is or is deemed to be incorporated
by reference in this Prospectus 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.
At the request of anyone to whom this Prospectus is delivered, we will
provide at no charge a copy of any and all information that has been or may be
incorporated by reference into this Prospectus. Requests for this information
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 in this Prospectus 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
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<PAGE>
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.
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<PAGE>
THE COMPANY
ServiceMaster, with operating revenue of approximately $4.7 billion in
1998, is one of the largest providers of residential services to individual
consumers, commercial services to businesses and supportive management services
to businesses and institutions in the United States. In addition, we have
operations in 41 countries around the world.
Our consumer/commercial services business, conducted through
subsidiaries of ServiceMaster Consumer Services Limited Partnership, provides
services to over 10.5 million residential and commercial customers world-wide
under leading brand names which include:
TruGreen-ChemLawn for lawn, tree and shrub care and indoor plant
maintenance;
TruGreen-LandCare (formerly LandCare USA) for commercial landscape
management and tree service.
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;
American Residential Services for heating, ventilation air
conditioning and refrigeration 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.
Our management services business, ServiceMaster Management Services,
provides facilities management services to over 2,000 customers in the health
care, education, and business and industrial markets. These services include
plant operations and maintenance, housekeeping, grounds and landscaping,
clinical equipment management, food service, laundry and linen services, total
facilities management and other 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.
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.
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<PAGE>
RECENT DEVELOPMENTS
On July 26, 1999, we reported record second quarter revenues of $1.5 billion, up
23 percent over the second quarter ended June 30, 1998, reflecting strong growth
from both base operations and acquisitions. Net income before non-recurring
unusual items was $69 million, up 23 percent over second quarter 1998. Earnings
per share before non-recurring items increased 16 percent to $.22. During the
quarter, we realized an after-tax gain of $30 million, relating primarily to the
sale of our Premier automotive services business, and recorded a one-time
after-tax charge of $81 million, relating to our diversified health services
business. These items reduced net income from ongoing operations by $51 million.
As a result, we reported net income of $18 million, with earnings per share of
$.06. For the six months ended June 30, 1999, revenue increased 19 percent to
$2.7 billion. Net income before non-recurring items rose 22 percent to $105
million, with earnings per share increasing 17 percent to $.34. Reported net
income after non-recurring items was $54 million, with earnings per share of
$.17.
On July 26, 1999, we announced that our board of directors elected C. William
Pollard to serve as chief executive officer effective October 1, 1999. Pollard
will continue to serve as chairman of the board of directors. Carlos H. Cantu,
our current president and chief executive officer, will retire on October 1,
1999.
On July 26, 1999, we announced that the scope of services offered by our
diversified health services business, which is conducted through our
wholly-owned subsidiary ServiceMaster Diversified Health Services, would be
substantially reduced. This business provides general management and other
services to long-term care facilities. This decision was made in light of
changes in government reimbursement policy and resulting financial difficulties
of a number of our long-term care customers. We will reduce the scope of
ancillary services offered, and eliminate future credit extension activities.
The one-time diversified health services charge of $81 million includes $51
million for a write-down of goodwill and $30 million relating to customer
receivables, loans, other investments and costs and the wind-down of certain
ancillary services.
On January 4, 1999 we announced the completion of a strategic review of our home
health care business, which is conducted through our wholly-owned subsidiary
ServiceMaster Home HealthCare. In particular, we announced our decision to sell
the direct operations of home health care agencies and certain support
operations and to discontinue outsourced operation of home health care agencies.
We will continue to provide consulting services to home health care agencies,
hospices and other medical service providers.
On March 18, 1999 we completed our acquisition of LandCare USA, Inc. through a
stock-for-stock merger. Approximately 10.2 million shares of our common stock
(valued at approximately $192 million), representing about three percent of our
then outstanding shares of common stock, were issued in this transaction. We
also assumed debt of approximately $127 million in the transaction. The
combination of LandCare with the existing operations of ServiceMaster, operating
under the name TruGreen-LandCare, established us as a leading provider of
commercial landscape services, which is a large and highly fragmented industry.
The acquisition also allows significant integration opportunities with our
TruGreen-ChemLawn subsidiary, a leading provider of lawn care services.
At the end of April 1999, we completed the acquisition of American Residential
Services, Inc. The total American Residential Services acquisition cost was
approximately $285 million, including assumed debt. The acquisition of American
Residential Services established us as a leading provider of HVAC services to
the residential and commercial sectors. In addition, American Residential
Services has plumbing revenues that significantly increase the size of our
Rescue Rooter plumbing business. This acquisition provides us with an
opportunity to coordinate the services of American Residential Services with the
needs of our American Home Shield subsidiary, which currently uses third-party
contractors to provide plumbing, HVAC and electrical repairs under warranty
products it markets to homeowners.
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<PAGE>
USE OF PROCEEDS
The Selling Stockholder will receive all of the proceeds from any sale
of the Shares.
SELLING STOCKHOLDER
The Shares covered by this Prospectus are being offered by or for the
account of the Selling Stockholder listed in the table below (the "Selling
Stockholder"). On March 5, 1999, the Company acquired the business and
substantially all of the assets of Turf Gard Company, Inc., an Ohio corporation,
in exchange for 87,627 shares of Common Stock. Shortly after this transaction,
the shares of Common Stock held by Turf Gard Company were distributed to William
E. Clutter, the sole shareholder of Turf Gard Company, in a complete liquidation
of the Company. Neither the Selling Stockholder or any of his 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 as a result of their
respective stock ownership of, and positions with, the Turf Gard Company.
The following table sets forth certain information as of July 31, 1999 with
respect to the shares of Common Stock held by the Selling Stockholder:
<TABLE>
<CAPTION>
Shares Beneficially Number Shares
Owned Prior to of Shares Beneficially Owned
Offering Being Offered After Offering
------------------- ------------- ------------------
Selling Stockholder Number Percent Number Percent
------ ------- ------ -------
<S> <C> <C> <C> <C> <C>
William E. Clutter 87,627 * 87,627 -- --
* Less than one percent
</TABLE>
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<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 July
31, 1999, approximately 311,900,000 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 July 31, 1999 the Company had 11,250,000
shares of Common Stock approved for issuance under the Company's equity
incentive plans, of which approximately 7,130,000 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 June 30 1999. 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.
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<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 in this Prospectus after 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.
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<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 in
this Prospectus after 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.
10
<PAGE>
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.
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 Stockholder. Alternatively, the Selling Stockholder 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 Stockholder or the purchasers of such securities
for whom they may act as agents. The Selling Stockholder 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.
11
<PAGE>
The Selling Stockholder will be subject to applicable provisions of the
Securities 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
Stockholder. The foregoing may affect the marketability of such securities.
The Selling Stockholder 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 Stockholder against certain liabilities arising from
or related to the information provided by the Selling Stockholder for use in
this Prospectus, 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 July 31, 1999 Mr. Squires held directly 393,336 shares of Common
Stock and indirectly through an investment partnership 61,189 shares of Common
Stock and options to purchase an aggregate of 225,000 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.
12
<PAGE>
<TABLE>
<CAPTION>
<S> <C>
============================================================ ========================================================
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, 87,627 Shares
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 The ServiceMaster Company
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 in
this Prospectus is correct as of any time subsequent to Common Stock
its date. (par value $.01 per share)
TABLE OF CONTENTS
Page
Available Information 2
Incorporation of Certain Documents
by Reference 3 PROSPECTUS
Special Note on Forward-looking
Statements 3
The Company 5
Recent Developments 6
Use of Proceeds 7
Selling Stockholder 7
Description of Capital Stock 8
Plan of Distribution 11
Legal Matters 12
Experts 12
August ___, 1999
============================================================ ========================================================
</TABLE>
<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 * $398
NYSE Listing Fee 1,500
Legal Fees and Expenses 5,000
Accounting Fees and Expenses 1,000
Printing and Engraving Fees 0
Miscellaneous 1,000
-----
Total $8,898
=====
*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
II-1
<PAGE>
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 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 tin this
Prospectus) 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 tin this
Prospectus), 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;
II-2
<PAGE>
(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
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
tin this Prospectus, 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 tin this Prospectus) 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 tin this Prospectus) 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.
II-3
<PAGE>
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.
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:
Exh.
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).
II-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 tin this Prospectus,
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 tin this Prospectus, 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 in this
II-5
<PAGE>
Prospectus, and the offering of such securities at that time shall be deemed to
be the initial bona fide offering thereof.
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 27th day of August, 1999.
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 August 27, 1999 by the following
persons in the capacities indicated:
<TABLE>
<CAPTION>
Signature Title
-------------------- --------------------------------------------------------------------
<S> <C>
*
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
II-6
<PAGE>
*
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: August 27, 1999
-----------------------------
Vernon T. Squires
Attorney-in-Fact
II-7
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT INDEX
Sequential
Exh. Page
No. Document Description Number
- --- --------------------------------------------------------------------------- ----------
<C> <S> <C>
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. II-9
23.1 Consent of Vernon T. Squires (included in Exhibit 5.1).
23.2 Consent of Arthur Andersen LLP. II-11
24.1 Power of Attorney. II-12
</TABLE>
- -------------------
(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).
II-8
Exhibits 5.1 and 23.1
August 27, 1999
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 87,627 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
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.
II-9
<PAGE>
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
II-10
Exhibit 23.2
Consent of Independent Public Accountants
As independent public accountants, we hereby consent to the use of our report
included in this registration statement and to the incorporation by reference in
this registration statement of our report dated January 15, 1999 included in The
ServiceMaster Company's Form 10-K for the year ended December 31, 1998 and to
all references to our Firm included in this registration statement.
/s/ Arthur Andersen LLP
ARTHUR ANDERSEN LLP
Chicago, Illinois
August 30, 1999
II-11
Exhibit 24.1
Power of Attorney
I hereby appoint each of Vernon T. Squires or Steven C. Preston or Eric
R. Zarnikow or any other person occupying the office of General Counsel, Chief
Financial Officer, 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
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 on Form S-8 which registers common stock to be issued
pursuant to the ServiceMaster Profit-Sharing and Retirement Plan; and (ii) a
registration statement on Form S-3 which registers the debt securities and the
equity securities which may be issued pursuant to the Company's 1999 universal
shelf registration statement in the approximate amount of $750 million (which
figure includes approximately $50 million from the Company's May 1997 universal
shelf 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 22, 1999
/s/ C. William Pollard
C. William Pollard
/s/ Carlos H. Cantu
Carlos H. Cantu
/s/ Phillip B. Rooney
Phillip B. Rooney
/s/ Charles W. Stair
Charles W. Stair
II-12
<PAGE>
/s/ Paul W. Berezny, Jr.
Paul W. Berezny, Jr.
/s/ Henry O. Boswell
Henry O. Boswell
/s/ Brian Griffiths
Brian Griffiths
/s/ Sidney E. Harris
Sidney E. Harris
/s/ Herbert P. Hess
Herbert P. Hess
/s/ Michelle M. Hunt
Michelle 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/ Steven S Reinemund
Steven S Reinemund
/s/ Burton E. Sorensen
Burton E. Sorensen
/s/ David K. Wessner
David K. Wessner
II-13
