(c) On June 30, 2006, ServiceMaster announced that J. Patrick Spainhour, a director of ServiceMaster since July 2005, had been appointed ServiceMaster’s Chairman and Chief Executive Officer. Mr. Spainhour had been appointed ServiceMaster’s Interim Chairman and Chief Executive Officer effective May 16, 2006.

ServiceMaster and Mr. Spainhour entered into a letter agreement on May 15, 2006 in connection with Mr. Spainhour’s appointment as Interim Chairman and Chief Executive Officer of ServiceMaster. Under the terms of the letter agreement, Mr. Spainhour is entitled to a base salary at the annual rate of $800,000 and, with respect to his service in 2006, a guaranteed bonus equal to 150% of the salary paid to him for service in 2006. He is entitled to those employee benefits and perquisites which ServiceMaster generally makes available to its executive officers, except that under the letter agreement he does not have a right to participate in ServiceMaster’s equity incentive plan in 2006 or the right to enter into a change in control severance agreement. He will be subject to non-competition and non-solicitation restrictions for a period of one year after he ceases being an employee of ServiceMaster. A copy of the letter agreement was filed as Exhibit 10.2 to ServiceMaster’s Current Report on Form 8-K dated May 15, 2006. ServiceMaster expects that the letter agreement will be replaced by an employment agreement and a change in control severance agreement. An amendment to this Current Report on Form 8-K describing such agreements will be filed upon ServiceMaster and Mr. Spainhour entering into such agreements.

Mr. Spainhour, age 56, served as the Chairman and Chief Executive Officer, AnnTaylor Stores Corporation, a national specialty retailer of quality women’s apparel, from 1996 until his retirement in 2005. Mr. Spainhour is a director of Circuit City Stores, Inc., a retailer of consumer electronics, and Tupperware Corporation, a direct seller of food storage items.

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