Market Overview

ServiceMaster Board Approves Spin-Off of Frontdoor

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  • Company establishes record date of September 14, 2018
  • Shares of Frontdoor, the parent of American Home Shield, are
    expected to begin trading on NASDAQ under the symbol FTDR on October
    1, 2018

ServiceMaster Global Holdings, Inc. (NYSE:SERV), a leading provider of
essential residential and commercial services, today announced that its
Board of Directors approved the separation of its American Home Shield
business through the distribution of at least 80.1 percent of the
outstanding shares of common stock of its wholly owned subsidiary,
frontdoor, inc. ("Frontdoor"), to holders of ServiceMaster common stock.

This press release features multimedia. View the full release here:
https://www.businesswire.com/news/home/20180827005183/en/

At the effective time of the separation, ServiceMaster shareholders will
own more than 80 percent of the outstanding shares of Frontdoor common
stock. ServiceMaster will continue to focus on delivering residential
and commercial services through nearly 8,000 owned, licensed and
franchised locations across its seven brands, which operate in more than
22 countries. Frontdoor, with annual revenue of approximately $1.2
billion, will be the largest home service plan company in the U.S.,
responding to over four million service requests annually through a
nationwide network of more than 2,000 employees and 15,000 pre-qualified
professional contractor firms that employ more than 45,000 technicians.

Following the separation, ServiceMaster's common stock will continue to
trade on NYSE under the symbol "SERV." Frontdoor's common stock has been
approved for listing on the NASDAQ under the symbol "FTDR."

"Today's announcement is a major milestone for our businesses and
shareholders," said Nik Varty, chief executive officer of ServiceMaster.
"As two independent, publicly traded companies, ServiceMaster and
Frontdoor each benefit from increased focus and flexibility to better
serve customers, drive organic growth and unlock significant long-term
value for our shareholders. We look forward to the successful completion
of the spin-off and to the opportunities ahead for both companies."

"We are the leader in the home service plan industry, and we have
tremendous opportunities to grow in the broader $400 billion home
services market," said Rex Tibbens, president and CEO of Frontdoor. "Our
team is obsessed with taking the hassle out of owning a home, and being
the first choice when it comes to home repairs, maintenance and
improvements. As a stand-alone company, we'll be fully focused on
delivering a great customer experience and delivering long-term
shareholder value."

Additional Details of the Distribution

The separation will be completed through a pro rata dividend of
Frontdoor common stock effective on October 1, 2018 (the "distribution
date") to ServiceMaster shareholders of record as of the close of
business on September 14, 2018 (the "record date"). Each ServiceMaster
shareholder as of the record date will receive one share of Frontdoor
common stock for every two share[s] of ServiceMaster common stock held
by such shareholder on the record date. Shareholders will receive cash
in lieu of any fractional shares that they would otherwise receive in
the distribution.

The distribution is intended to qualify as a tax-free transaction to
ServiceMaster shareholders for U.S. federal income tax purposes, and
ServiceMaster has received a favorable private letter ruling from the
IRS regarding the tax-free treatment of the transaction. Cash received
in lieu of fractional shares, however, may be subject to federal income
tax. ServiceMaster shareholders should consult their tax advisors with
respect to U.S. federal, state, local and foreign tax consequences of
the separation and distribution.

The distribution does not require shareholder approval, nor is any
shareholder action necessary to receive shares in the distribution of
Frontdoor common stock. ServiceMaster intends to distribute an
information statement to all shareholders entitled to receive the
distribution of shares of Frontdoor. The information statement is an
exhibit to Frontdoor's Registration Statement on Form 10 and describes
Frontdoor's business, certain risks of owning Frontdoor common stock and
other details regarding the separation and distribution

ServiceMaster shares will continue to trade "regular way" on the NYSE
under the symbol SERV through and after the distribution date. Any
holders of shares of ServiceMaster common stock who sell ServiceMaster
shares "regular way" on or before the close of business on September 14,
2018, will also be selling their right to receive shares of Frontdoor
common stock in the distribution. It is anticipated that ServiceMaster
shares will also begin trading ex-distribution (that is, without the
right to receive shares of Frontdoor common stock) on or about September
13, 2018, continuing through September 28, 2018. Investors are
encouraged to consult with their financial advisers regarding the
specific implications of buying or selling ServiceMaster common stock on
or before the distribution date.

A "when-issued" public trading market for Frontdoor common stock is
expected to begin on or about September 13, 2018, on the NASDAQ,
continuing through September 28, 2018. ServiceMaster anticipates that
"regular way" trading of Frontdoor common stock under the symbol "FTDR"
will begin on October 1, 2018.

The distribution of Frontdoor common stock is subject to the
satisfaction or waiver of certain conditions, including, but not limited
to, the Registration Statement on Form 10 for Frontdoor common stock
being declared effective by the U.S. Securities and Exchange Commission,
and other conditions described in the Information Statement included in
the Form 10. ServiceMaster and Frontdoor expect that all conditions to
the separation and distribution will be satisfied on or before the
distribution date.

Frontdoor Investor Day

Frontdoor, a business that's built on taking the hassle out of owning a
home, is hosting an investor day to discuss the company's commitment to
simplify homeownership through technology-enabled and people-driven home
services. Join Frontdoor Chief Executive Officer Rex Tibbens and other
leaders as they share how the company will grow its core business of
four brands today (American Home Shield, HSA, Landmark and OneGuard),
expand its service offerings and more. Please contact InvestorRelations@servicemaster.com
or call (800) 943-0969 to register. On-site registration will begin at 8
a.m. Eastern, and the conference will begin at 8:30 a.m. Eastern (5:30
a.m. Pacific Time).

Frontdoor Board of Directors

As previously announced, as of the date of separation, Peter L. Cella
will resign from ServiceMaster's Board of Directors to serve as Chairman
of Frontdoor's Board of Directors. Current ServiceMaster directors
Richard P. Fox and William C. Cobb also will resign from the
ServiceMaster Board to serve as directors of Frontdoor. In addition,
Liane J. Pelletier, Anna C. Catalano and President and CEO Rexford J.
Tibbens, will serve as directors of Frontdoor.

Advisors

J.P. Morgan is acting as financial advisor on the separation transaction
and Wachtell, Lipton, Rosen & Katz is acting as legal advisor.

About ServiceMaster

ServiceMaster Global Holdings, Inc. is a leading provider of essential
residential and commercial services, operating through an extensive
service network of more than 8,000 company-owned locations and franchise
and license agreements. The company's portfolio of well-recognized
brands includes AmeriSpec (home inspections), Furniture Medic (cabinet
and furniture repair), Merry Maids (residential cleaning), ServiceMaster
Clean (janitorial), ServiceMaster Restore (disaster restoration),
Terminix (residential termite and pest control), and Terminix Commercial
(commercial termite and pest control). The company is headquartered in
Memphis, Tenn.

About Frontdoor

Frontdoor is a company that's obsessed with taking the hassle out of
owning a home. With services powered by people and enabled by
technology, it is the parent company of four home service plan brands:
American Home Shield, HSA, Landmark and OneGuard. Together, they serve
more than two million customers across the U.S. through a network of
15,000 pre-qualified contractor firms that employ over 45,000
technicians. The company's customizable home service plans help
customers protect and maintain their homes from costly and unplanned
breakdowns of essential home systems and appliances. With more than 45
years of experience, the company responds to over four million service
requests annually (or one request every eight seconds).

Information Regarding Forward-Looking Statements

This press release contains forward-looking statements and cautionary
statements, including statements with respect to the potential
separation of Frontdoor from ServiceMaster and the distribution of
Frontdoor shares to ServiceMaster shareholders. Forward-looking
statements can be identified by the use of forward-looking terms such as
"believes," "expects," "may," "will," "shall," "should," "would,"
"could," "seeks," "aims," "projects," "is optimistic," "intends,"
"plans," "estimates," "anticipates" or other comparable terms.
Forward-looking statements are subject to known and unknown risks and
uncertainties, many of which may be beyond ServiceMaster's control,
including, without limitation, the risks and uncertainties discussed in
the "Risk Factors" and "Information Regarding Forward-Looking
Statements" sections in ServiceMaster's reports filed with the U.S.
Securities and Exchange Commission. Such risks, uncertainties and
changes in circumstances include, but are not limited to: uncertainties
as to the timing of the spin-off or whether it will be completed at all,
the results and impact of the announcement of the spin-off, the failure
to satisfy any conditions to complete the spin-off, the expected tax
treatment of the spin-off, the increased demands on management to
prepare for and accomplish the spin-off, the incurrence of significant
transaction costs, the impact of the spin-off on the businesses of
ServiceMaster and Frontdoor, and the failure to achieve anticipated
benefits of the spin-off. ServiceMaster cautions investors that
forward-looking statements are not guarantees of future performance or
outcomes and that actual performance and outcomes, including, without
limitation, ServiceMaster's actual results of operations, financial
condition and liquidity, and the development of the market segments in
which ServiceMaster operates, may differ materially from those made in
or suggested by the forward-looking statements contained in this press
release. Additional factors that could cause actual results and outcomes
to differ from those reflected in forward-looking statements include,
without limitation, lawsuits, enforcement actions and other claims by
third parties or governmental authorities; compliance with, or violation
of environmental health and safety laws and regulations; the effects of
ServiceMaster's substantial indebtedness; changes in interest rates,
because a significant portion of ServiceMaster's indebtedness bears
interest at variable rates; weakening general economic conditions;
weather conditions and seasonality; the success of ServiceMaster's
business strategies, and costs associated with restructuring
initiatives. ServiceMaster assumes no obligation to update the
information contained herein, which speaks only as of the date hereof.
For a discussion of some of the important factors that could cause
ServiceMaster's results to differ materially from those expressed in, or
implied by, the forward-looking statements included in this press
release, investors should refer to the disclosure contained under the
heading "Risk Factors" in ServiceMaster's reports filed with the U.S.
Securities and Exchange Commission.

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