<PAGE> 1
As filed with the Securities and Exchange Commission on November 25, 1998
REGISTRATION NO. 333-
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------------------
FORM S-8
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
------------------------------------
AMERICAN RESIDENTIAL SERVICES, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 76-0484996
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
POST OAK TOWER
5051 WESTHEIMER, SUITE 725
HOUSTON, TEXAS 77056-5604
(Address of Principal Executive Offices, including Zip Code)
AMERICAN RESIDENTIAL SERVICES, INC. EMPLOYEE STOCK PURCHASE PLAN
(Full title of the plan)
JOHN D. HELD, ESQ.
SENIOR VICE PRESIDENT, GENERAL COUNSEL AND SECRETARY
AMERICAN RESIDENTIAL SERVICES, INC.
POST OAK TOWER
5051 WESTHEIMER, SUITE 725
HOUSTON, TEXAS 77056-5604
(713) 599-0100
(Name, address and telephone number, including area code, of agent for service)
------------------------------------
With Copy to:
FULBRIGHT & JAWORSKI L.L.P.
1301 MCKINNEY, SUITE 5100
HOUSTON, TEXAS 77010
(713) 651-5151
ATTENTION: CHARLES L. STRAUSS
------------------------------------
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
====================================================================================================================================
PROPOSED MAXIMUM PROPOSED MAXIMUM
TITLE OF SECURITIES TO AMOUNT TO BE OFFERING PRICE PER AGGREGATE OFFERING PRICE AMOUNT OF
BE REGISTERED REGISTERED SHARE(1) (1) REGISTRATION FEE
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, $.001
par value per share, and
accompanying Rights to
Purchase Series A
Junior Participating
Preferred Stock 350,000(2) $3.57 $1,249,500 $348
====================================================================================================================================
</TABLE>
(1) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457(c) and (h) under the Securities Act of 1933 and
based upon the average of the high and low sales prices of a share of
Common Stock quoted on the New York Stock Exchange on November 19,
1998.
(2) Includes an indeterminable number of shares of Common Stock and
accompanying Rights issuable as a result of the anti-dilution
provisions of the American Residential Services, Inc. Employee Stock
Purchase Plan.
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<PAGE> 2
PART I
INFORMATION REQUIRED IN THE SECTION 10(A) PROSPECTUS
Note: The document containing the employee benefit plan information
required by Item 1 of Form S-8 and the statement of availability of registrant
information and any other information required by Item 2 of Form S-8 will be
sent or given to participants as specified by Rule 428 under the Securities Act
of 1933, as amended (the "Securities Act"). In accordance with Rule 428 and the
requirements of Part I of Form S-8, such documents are not being filed with the
Securities and Exchange Commission (the "Commission") either as part of this
Registration Statement or as prospectuses or prospectus supplements pursuant to
Rule 424 under the Securities Act. The registrant will maintain a file of such
documents in accordance with the provisions of Rule 428. Upon request, the
registrant will furnish to the Commission or its staff a copy or copies of all
of the documents included in such file.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
American Residential Services, Inc., a Delaware corporation (the
"Company" or "Registrant"), incorporates by reference in this Registration
Statement the following documents filed by it with the Commission:
1. The Registrant's Annual Report on Form 10-K for the fiscal
year ended December 31, 1997;
2. The Registrant's Quarterly Reports on Form 10-Q for the
quarters ended March 31, 1998, June 30, 1998 and September 30, 1998;
3. The Registrant's Current Reports on Form 8-K and 8-K/A
filed May 27, 1998, June 26, 1998, July 24, 1998 and September 28, 1998;
4. All other reports filed pursuant to Section 13(a) or 15(d)
of the Securities Exchange Act of 1934, as amended (the "Exchange Act") since
December 31, 1997;
5. The description of the Registrant's common stock, $.001
par value per share (the "Common Stock"), contained in the Registrant's
Registration Statement on Form 8-A filed June 19, 1996, including any amendment
or reports filed for the purpose of updating such description; and
6. The description of the Rights to Purchase Series A Junior
Participating Preferred Stock of the Company contained in the Company's
Registration Statement on Form 8-A filed June 27, 1996.
All documents filed by the Registrant with the Commission
pursuant to Section 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of
1934 after November 25, 1998, and before the filing of a post-effective
amendment to this Registration Statement, which indicates that all securities
offered under this Registration Statement have been sold, or which deregisters
all securities then remaining unsold, are incorporated by reference in, and
constitute a part of, this Registration Statement from the date such documents
are filed.
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<PAGE> 3
The language in this Registration Statement modifies and
supersedes the language in any previously filed document that is incorporated by
reference in this Registration Statement. The language in any document that is
filed after this Registration and that is incorporated by reference in this
Registration Statement modifies and supersedes the language in this Registration
Statement. However, such language constitutes a part of this Registration
Statement only to the extent that it modifies and supersedes this Registration
Statement.
ITEM 4. DESCRIPTION OF SECURITIES.
Not applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
Not applicable.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Delaware General Corporation Law
Section 145 of the General Corporation Law of the State of
Delaware provides that a corporation has the power to indemnify a director,
officer, employee or agent of the corporation and certain other persons serving
at the request of the corporation in related capacities against amounts paid and
expenses incurred in connection with an action or proceeding to which he is, or
is threatened to be made, a party by reason of such position, if such person
shall have acted in good faith and in a manner he reasonably believed to be in
or not opposed to the best interests of the corporation, and, in any criminal
proceeding, if such person had no reasonable cause to believe his conduct was
unlawful; provided that, in the case of actions brought by or in the right of
the corporation, no indemnification shall be made with respect to any matter as
to which such person shall have been adjudged to be liable to the corporation
unless and only to the extent that the adjudicating court determines that such
indemnification is proper under the circumstances.
Certificate of Incorporation
The Restated Certificate of Incorporation of the Company
provides that a director of the Company shall not be personally liable to the
Company or its stockholders for monetary damages for breach of fiduciary duty as
a director, except for liability (i) for any breach of the director's duty of
loyalty to the Company or its stockholders, (ii) for acts or omissions not in
good faith or which involve intentional misconduct or a knowing violation of
law, (iii) under Section 174 of the DGCL, or (iv) for any transaction from which
the director derived an improper personal benefit. If the DGCL is amended to
authorize the further elimination or limitation of the liability of directors,
then the liability of a director of the Company, in addition to the limitation
on personal liability described above, shall be limited to the fullest extent
permitted by the amended DGCL. Further, any repeal or modification of such
provision of the Restated Certificate of Incorporation by the stockholders of
the Company shall be prospective only, and shall not adversely affect any
limitation on the personal liability of a director of the Company existing at
the time of such repeal or modification.
Bylaws
The Bylaws of the Company provide that the Company will
indemnify and hold harmless any director or officer of the Company to the
fullest extent permitted by applicable law, as in effect as of the date of the
adoption of the Bylaws or to such greater extent as applicable law may
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<PAGE> 4
thereafter permit, from and against all judgments, penalties, fines, amounts
paid in settlement and expenses (including attorneys' fees) whatsoever arising
out of any event or occurrence related to the fact that such person is or was a
director or officer of the Company and further provide that the Company may, but
is not required to, indemnify and hold harmless any employee or agent of the
Company or a director, officer, employee or agent of any other corporation,
partnership, joint venture, trust, employee benefit plan or other enterprise who
is or was serving in such capacity at the written request of the Company;
provided, however, that the Company is only required to indemnify persons
serving as directors, officers, employees or agents of the Company for the
expenses incurred in a proceeding if such person is a party to and is
successful, on the merits or otherwise, in such proceeding, or if unsuccessful
in the proceeding, but successful as to a matter in such proceeding the expenses
attributable to such matter and provided further that the Company may, but is
not required to, indemnify such persons who are serving as a director, officer,
employee or agent of any other corporation, partnership, joint venture, trust,
employee benefit plan or other enterprise at the written request of the Company
for the expenses incurred in a proceeding if such person is a party to and is
successful, on the merits or otherwise, in such proceeding. The Bylaws further
provide that, in the event of any threatened, or pending action, suit or
proceeding in which any of the persons referred to above is a party or is
involved and that may give rise to a right of indemnification under the Bylaws,
following written request by such person, the Company will promptly pay to such
person amounts to cover expenses reasonably incurred by such person in such
proceeding in advance of its final disposition upon the receipt by the Company
of (i) a written undertaking executed by or on behalf of such person providing
that such person will repay the advance if it is ultimately determined that such
person is not entitled to be indemnified by the Company as provided in the
Bylaws and (ii) satisfactory evidence as to the amount of such expenses.
Indemnification Agreements
The Company has entered into Indemnification Agreements with
each of its directors and executive officers. The Indemnification Agreements
generally are to the same effect as the Bylaw provisions described above.
Insurance
The Company maintains liability insurance for the benefit of its
directors and officers.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not applicable.
ITEM 8. EXHIBITS.
Exhibit No. Description
4.1* - Restated Certificate of Incorporation of the Company (Exhibit
3.1 to Form S-1 filed June 18, 1996, Reg. No. 333-06195).
4.2* - Bylaws of the Company (Exhibit 3.2 to Form S-1 filed June 18,
1996, Reg. No. 333-06195).
4.3* - Form of Certificate representing Common Stock (Exhibit 4.1 to
Form S-1 filed June 18, 1996, Reg. No. 333-06195).
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<PAGE> 5
4.4* - Certificate of Designation of Series A Junior Participating
Preferred Stock (Exhibit 3.3 to Form S-1 filed June 18, 1996,
Reg. No. 333-06195).
4.5* - Rights Agreement between the Company and ChaseMellon
Shareholder Services, L.L.C., including form of Rights
Certificate as Exhibit B thereto (Exhibit 4.4 to Form S-8 filed
October 2, 1996, Reg. No. 333-13299).
4.6* - American Residential Services, Inc. 1996 Incentive Plan
(Exhibit 10.1 to Form S-1, Reg. No. 333-06195).
4.7* - Amendment to American Residential Services, Inc. 1996 Incentive
Plan (Exhibit 10.2 to Form 10-K filed March 31, 1998, Reg. No.
001-11849).
4.8* - American Residential Services, Inc. 1997 Employee Incentive
Plan (Exhibit 4.5 to Form S-8 filed January 26, 1198, Reg. No.
333-44913).
4.9* - Amendment to American Residential Services, Inc. 1997 Employee
Incentive Plan (Exhibit 10.4 to Form 10-K filed March 31, 1998,
Reg. No. 001-11849).
4.10 - American Residential Services, Inc. Employee Stock Purchase
Plan.
5.1 - Opinion of John D. Held.
23.1 - Consent of Arthur Andersen LLP
23.2 - Consent of Watkins, Meegan, Drury & Company, L.L.C.
23.3 - Consent of John D. Held (included in Exhibit 5.1).
24.1 - Powers of Attorney (included on the signature pages hereof).
- ---------------
* Incorporated herein by reference as indicated.
ITEM 9. UNDERTAKINGS.
(a) 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:
(i) To include any prospectus required by Section
10(a)(3) of the Securities Act;
(ii) To reflect in the prospectus any facts or events
arising after the effective date of this Registration
Statement (or the most recent post-effective amendment
hereof) which, individually or in the aggregate,
represent a fundamental change in the information set
forth in this Registration Statement. Notwithstanding
the foregoing, any increase or decrease in volume of
securities offered (if the total dollar value of
securities offered would not exceed that which was
registered) and any deviation from the low or high end
of the estimated maximum offering range may be
reflected in the form of prospectus filed with the
Commission pursuant to Rule 424(b) of the Securities
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<PAGE> 6
Act if, in the aggregate, the changes in volume and
price represent no more than a 20% change in the
maximum aggregate offering price set forth in the
"Calculation of Registration Fee" table in the
effective registration statement; and
(iii) To include any material information with respect
to the plan of distribution not previously disclosed in
this Registration Statement or any material change to
such information in this Registration Statement;
provided, however, that paragraphs (a)(i) and (a)(ii) do not
apply if 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 Section 15(d) of the Exchange Act that are incorporated by
reference in this 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 herein, 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.
(b) 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 this Registration Statement shall be deemed to be a
new registration statement relating to the securities offered herein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
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 Securities and Exchange
Commission 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.
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<PAGE> 7
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Houston, State of Texas, on the 25th day of November,
1998.
AMERICAN RESIDENTIAL SERVICES, INC.
By: /s/ Thomas N. Amonett
-------------------------------------
Thomas N. Amonett
President and Chief Executive Officer
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each individual whose signature
appears below constitutes and appoints Thomas N. Amonett, John D. Held and Harry
O. Nicodemus, IV, or any of them, his true and lawful attorney-in-fact and
agent, with full power of substitution and resubstitution, for him and in his
name, place and stead, in any and all capacities, to sign any and all amendments
(including post-effective amendments) to this Registration Statement, and to
file the same and all exhibits thereto, and all documents in connection
therewith, with the Securities and Exchange Commission, granting said
attorney-in-fact and agent, and any of them, full power and authority to do and
perform each and every act and thing requisite and necessary to be done in and
about the premises, as fully to all intents and purposes as he might or could do
in person, hereby ratifying and confirming all that said attorney-in-fact and
agent, or any of them, or his or their substitute or substitutes, may lawfully
do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
<S> <C> <C>
/s/ Thomas N. Amonett President, Chief Executive
- ------------------------------------------ Officer and Director
Thomas N. Amonett (Principal Executive Officer) November 25, 1998
/s/ Harry O. Nicodemus, IV Senior Vice President, Chief
- ------------------------------------------ Financial Officer and Chief
Harry O. Nicodemus, IV Accounting Officer November 25, 1998
/s/ Howard S. Hoover, Jr. Chairman of the Board November 25, 1998
- ------------------------------------------
Howard S. Hoover, Jr.
/s/ Robert J. Cruikshank Director November 25, 1998
- ------------------------------------------
Robert J. Cruikshank
/s/ Randall B. Hale Director November 25, 1998
- ------------------------------------------
Randall B. Hale
/s/ Nolan Lehmann Director November 25, 1998
- ------------------------------------------
Nolan Lehmann
</TABLE>
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<TABLE>
<S> <C> <C>
/s/ Frank N. Menditch Director November 25, 1998
- ------------------------------------------
Frank N. Menditch
/s/ Elliot Sokolow Director November 25, 1998
- ------------------------------------------
Elliot Sokolow
/s/ Don D. Jordan Director November 25, 1998
- ------------------------------------------
Don D. Jordan
/s/ Bobby S. Shackouls Director November 25, 1998
- ------------------------------------------
Bobby S. Shackouls
</TABLE>
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EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit No. Description
- ---------- -----------
<S> <C> <C>
4.1* - Restated Certificate of Incorporation of the Company (Exhibit
3.1 to Form S-1 filed June 18, 1996, Reg. No. 333-06195).
4.2* - Bylaws of the Company (Exhibit 3.2 to Form S-1 filed June 18,
1996, Reg. No. 333-06195).
4.3* - Form of Certificate representing Common Stock (Exhibit 4.1 to
Form S-1 filed June 18, 1996, Reg. No. 333-06195).
4.4* - Certificate of Designation of Series A Junior Participating
Preferred Stock (Exhibit 3.3 to Form S-1 filed June 18, 1996,
Reg. No. 333-06195).
4.5* - Rights Agreement between the Company and ChaseMellon
Shareholder Services, L.L.C., including form of Rights
Certificate as Exhibit B thereto (Exhibit 4.4 to Form S-8 filed
October 2, 1996, Reg. No. 333-13299).
4.6* - American Residential Services, Inc. 1996 Incentive Plan
(Exhibit 10.1 to Form S-1, Reg. No. 333-06195).
4.7* - Amendment to American Residential Services, Inc. 1996 Incentive
Plan (Exhibit 10.2 to Form 10-K filed March 31, 1998, Reg. No.
001-11849).
4.8* - American Residential Services, Inc. 1997 Employee Incentive
Plan (Exhibit 4.5 to Form S-8 filed January 26, 1198, Reg. No.
333-44913).
4.9* - Amendment to American Residential Services, Inc. 1997 Employee
Incentive Plan (Exhibit 10.4 to Form 10-K filed March 31, 1998,
Reg. No. 001-11849).
4.10 - American Residential Services, Inc. Employee Stock Purchase
Plan.
5.1 - Opinion of John D. Held.
23.1 - Consent of Arthur Andersen LLP
23.2 - Consent of Watkins, Meegan, Drury & Company, L.L.C.
23.3 - Consent of John D. Held (included in Exhibit 5.1).
24.1 - Powers of Attorney (included on the signature pages hereof).
</TABLE>
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* Incorporated herein by reference as indicated.
<PAGE> 1
EXHIBIT 4.10
AMERICAN RESIDENTIAL SERVICES, INC.
EMPLOYEE STOCK PURCHASE PLAN
Effective July 20, 1998 (the "Effective Date")
1. PURPOSE
The American Residential Services, Inc. Employee Stock
Purchase Plan (the "Plan") is designed to encourage and assist all employees of
American Residential Services, Inc., a Delaware corporation ("ARS") and
Subsidiaries (as defined in Section 4) (hereinafter collectively referred to as
the "Company"), where permitted by applicable laws and regulations, to acquire
an equity interest in ARS through the purchase of shares of common stock, par
value $.001 per share, of ARS ("Common Stock"). It is intended that this Plan
shall constitute an "employee stock purchase plan" within the meaning of Section
423 of the Internal Revenue Code of 1986, as amended (the "Code").
2. ADMINISTRATION OF THE PLAN
The Plan shall be administered and interpreted by the
Compensation Committee (the "Committee") of the Board of Directors of ARS (the
"Board"). The Committee shall supervise the administration and enforcement of
the Plan according to its terms and provisions and shall have all powers
necessary to accomplish these purposes and discharge its duties hereunder
including, but not by way of limitation, the power to (i) employ and compensate
agents of the Committee for the purpose of administering the accounts of
participating employees; (ii) construe or interpret the Plan; (iii) determine
all questions of eligibility; and (iv) compute the amount and determine the
manner and time of payment of all benefits according to the Plan.
The Committee may act by decision of a majority of its members
at a regular or special meeting of the Committee or by decision reduced to
writing and signed by all members of the Committee without holding a formal
meeting.
3. NATURE AND NUMBER OF SHARES
The Common Stock subject to issuance under the terms of the
Plan shall be ARS's authorized but unissued shares, previously issued shares
reacquired and held by ARS or shares purchased on the open market. The aggregate
number of shares which may be issued under the Plan shall not exceed three
hundred and fifty thousand (350,000) shares of Common Stock. All shares
purchased under the Plan, regardless of source, shall be counted against the
three hundred and fifty thousand (350,000) share limitation.
In the event of any reorganization, stock split, reverse stock
split, stock dividend, combination of shares, merger, consolidation, offering of
rights or other similar change in the capital structure of ARS, the Committee
may make such adjustment, if any, as it deems appropriate in the
<PAGE> 2
number, kind and purchase price of the shares available for purchase under the
Plan and in the maximum number of shares which may be issued under the Plan,
subject to the approval of the Board and in accordance with Section 19.
4. ELIGIBILITY REQUIREMENTS
Each "Employee" (as hereinafter defined), except as described
in the next following paragraph, shall become eligible to participate in the
Plan in accordance with Section 5 on the first "Enrollment Date" (as defined
therein) following employment by the Company. Participation in the Plan is
voluntary.
The following Employees are not eligible to participate in the
Plan:
(i) Employees who would, immediately upon enrollment in the
Plan, own directly or indirectly, or hold options or rights to acquire,
an aggregate of five percent (5%) or more of the total combined voting
power or value of all outstanding shares of all classes of the Company
or any subsidiary (in determining stock ownership of an individual, the
rules of Section 424(d) of the Code shall be applied, and the Committee
may rely on representations of fact made to it by the Employee and
believed by it to be true); and
(ii) Employees who are customarily employed by the Company
less than twenty (20) hours per week or less than five (5) months in
any calendar year.
"Employee" shall mean any individual employed by ARS or any
Subsidiary (as hereinafter defined). "Subsidiary" shall mean any corporation
which is in an unbroken chain of corporations or other entities beginning with
ARS if, on or after the Effective Date, each of the corporations or other
entities other than the last corporation or entity in the chain owns stock
possessing fifty percent (50%) or more of the total combined voting power of all
classes of stock or equity in one of the other corporations or other entities in
the chain.
5. ENROLLMENT
Each eligible Employee of ARS or any owned Subsidiary which is
90% or greater owned by ARS (whether the Subsidiary is a Subsidiary on the
Effective Date or becomes a Subsidiary after the Effective Date) may enroll in
the Plan as of the Effective Date. Each other eligible Employee of ARS or a
participating Subsidiary who thereafter becomes eligible to participate may
enroll in the Plan on the first January 1 or July 1, as applicable, following
the date he first meets the eligibility requirements of Section 4. Any eligible
Employee not enrolling in the Plan when first eligible may enroll in the Plan on
any subsequent January 1 or July 1, as applicable. Any eligible Employee may
enroll or re-enroll in the Plan on the dates hereinabove prescribed or such
other specific dates established by the Committee from time to time ("Enrollment
Dates"). In order to enroll, an eligible Employee must complete, sign and submit
the appropriate form to the person designated by the Committee.
-2-
<PAGE> 3
6. METHOD OF PAYMENT
Payment for shares is to be made as of the applicable
"Purchase Date" (as defined in Section 9) through payroll deductions on an
after-tax basis (with no right of prepayment) over the Plan's designated
purchase period (the "Purchase Period"), with the first such deduction
commencing with the first payroll period ending after the Enrollment Date. Each
Purchase Period under the Plan shall be a period of six (6) months beginning on
each January 1 and ending on the following June 30, and beginning on each July 1
and ending on December 31, or such other period as the Committee may prescribe;
provided, however, that the Purchase Period beginning on the Effective Date
shall commence on the Effective Date and end on December 31, 1998. Each
participating Employee (hereinafter referred to as a "Participant") will
authorize such deductions from his pay for each month during the Purchase Period
and such amounts will be deducted in conformity with his employer's payroll
deduction schedule.
Each Participant may elect to make contributions each pay
period in amounts not less than ten dollars ($10), and not to exceed a monthly
contribution equal to ten percent (10%) of the Participant's monthly
compensation (salary or wages plus any overtime pay) (or such other dollar
amounts as the Committee may establish from time to time before an Enrollment
Date for all purchases to occur during the relevant Purchase Period). In
establishing other dollar amounts of permitted contributions, the Committee may
take into account the "Maximum Share Limitation" (as defined in Section 8). The
rate of contribution shall be designated by the Participant in the enrollment
form.
A Participant may elect to increase or decrease the rate of
contribution effective as of the first day of the Purchase Period by giving
prior written notice to the person designated by the Committee on the
appropriate form. A Participant may not elect to increase or decrease the rate
of contribution during a Purchase Period. A Participant may suspend payroll
deductions at any time during the Purchase Period, by giving prior written
notice to the person designated by the Committee on the appropriate form. If a
Participant elects to suspend his payroll deductions, such Participant's account
will be used to purchase stock at the end of the Purchase Period. A Participant
may also elect to withdraw his entire contributions for the current Purchase
Period in accordance with Section 8, by giving prior written notice to the
person designated by the Committee on the appropriate form. Any Participant who
withdraws his contributions will receive, as soon as practicable, his entire
account balance, including dividends, if any. Any Participant who suspends
payroll deductions or withdraws contributions during any Purchase Period cannot
resume payroll deductions during such Purchase Period and must re-enroll in the
Plan in order to participate in the next Purchase Period.
Except in case of cancellation of election to purchase, death,
resignation or other terminating event, the amount in a Participant's account at
the end of the Purchase Period will be applied to the purchase of Common Stock.
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<PAGE> 4
7. CREDITING OF CONTRIBUTIONS; NO INTEREST OR DIVIDENDS
Contributions shall be credited to a Participant's account as
soon as administratively feasible after payroll withholding. Participant
contributions will not receive interest. Dividends on shares of Common Stock, if
any, will be paid to a Participant's account only after such shares of Common
Stock have been purchased and are being held for behalf of the Participant's
account. Any such contributions and dividends shall be deposited in or held by a
bank or financial institution designated by the Committee for this purpose (the
"Custodian").
8. GRANT OF RIGHT TO PURCHASE SHARES ON ENROLLMENT
Enrollment in the Plan by an Employee on an Enrollment Date
will constitute the grant by the Company to the Participant of the right to
purchase shares of Common Stock under the Plan. Re-enrollment by a Participant
in the Plan will constitute a grant by the Company to the Participant of a new
opportunity to purchase shares on the Enrollment Date on which such
re-enrollment occurs. A Participant who has not (a) terminated employment, (b)
withdrawn his contributions from the Plan, or (c) notified the Company in
writing, by June 1 or December 1, as applicable (or such date as the Committee
shall establish), of his election to withdraw his payroll deductions as of June
30 or December 31, as applicable, will have shares of Common Stock purchased for
him on the applicable Purchase Date, and he will automatically be re-enrolled in
the Plan on the Enrollment Date immediately following the Purchase Date on which
such purchase has occurred, unless each Participant notifies the person
designated by the Committee on the appropriate form that he elects not to
re-enroll.
Each right to purchase shares of Common Stock under the Plan
during a Purchase Period shall have the following terms:
(i) the right to purchase shares of Common Stock during a
particular Purchase Period shall expire on the earlier of: (A) the
completion of the purchase of shares on the Purchase Date occurring in
the Purchase Period, or (B) the date on which participation of such
Participant in the Plan terminates for any reason;
(ii) payment for shares purchased will be made only through
payroll withholding in accordance with Sections 6 and 7;
(iii) purchase of shares will be accomplished only in
accordance with Section 9;
(iv) the price per share will be determined as provided in
Section 9;
(v) the right to purchase shares (taken together with all
other such rights then outstanding under this Plan and under all other
similar stock purchase plans of ARS or any Subsidiary) will in no event
give the Participant the right to purchase a number of shares during a
calendar year in excess of the number of shares of Common Stock derived
by dividing twenty-five thousand dollars ($25,000) by the
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fair market value of the Common Stock (the "Maximum Share Limitation")
on the applicable Grant Date determined in accordance with Section 9;
(vi) shares purchased under this Plan may not be sold within
six (6) months of the Purchase Date, unless the Committee, in its sole
discretion, waives this requirement; and
(vii) the right to purchase shares will in all respects be
subject to the terms and conditions of the Plan, as interpreted by the
Committee from time to time.
9. PURCHASE OF SHARES
The right to purchase shares of Common Stock granted by the
Company under the Plan is for the term of a Purchase Period. The fair market
value of the Common Stock ("Fair Market Value") to be purchased during such
Purchase Period will be the closing composite sales price per share of the
Common Stock in the New York Stock Exchange Composite Transactions Quotations
("NYSE") on the first trading day of the calendar month of January or July, as
applicable, or such other trading date designated by the Committee (the "Grant
Date"). The Fair Market Value of the Common Stock will again be determined in
the same manner on the last trading day of the calendar month of June or
December, as applicable, or such other trading date designated by the Committee
(the "Purchase Date"); however, in no event shall the Committee, in the exercise
of its discretion, designate a Purchase Date beyond twelve (12) months from the
related Enrollment Date or otherwise fail to meet the requirements of Section
423(b)(7) of the Code. These dates constitute the date of grant and the date of
exercise for valuation purposes of Section 423 of the Code.
As of the Purchase Date, the Committee shall apply the funds
then credited to each Participant's account to the purchase of shares of Common
Stock. The cost to the Participant for the shares purchased during a Purchase
Period shall be the lower of:
(i) eighty-five percent (85%) of the Fair Market Value of
Common Stock on the Grant Date; or
(ii) eighty-five percent (85%) of the Fair Market Value of
Common Stock on the Purchase Date.
Certificates evidencing whole shares purchased shall be
delivered to the Custodian or to any other bank or financial institution
designated by the Committee for this purpose or delivered to the Participant (if
the Participant has elected by written notice to the Committee to receive the
certificate) as soon as administratively feasible after the Purchase Date;
however, certificates shall not be delivered to the Participant within eighteen
(18) months of the Purchase Date of the underlying shares, except as otherwise
provided herein. Certificates for fractional shares of Common Stock shall not be
issued. Notwithstanding the foregoing, Participants shall be treated as the
record owners of their whole shares effective as of the Purchase Date. Shares
that are held by the Custodian or any other designated bank or financial
institution shall be held in book entry form. Any Participant (i) who purchases
stock at the end of a Purchase Period and is not re-enrolled in the
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Plan for the next Purchase Period or (ii) who withdraws his contributions from
the Plan prior to the next Purchase Date may elect to receive a certificate for
the whole number of shares held in his account for at least eighteen (18) months
as of the most recent Purchase Date, cash for any remaining book-entry
fractional share calculated at the closing composite sales price per share on
the NYSE on the date of distribution, and any cash or dividends remaining in his
account. Such Participant may elect to receive a certificate for the remaining
whole number of shares held in his account eighteen (18) months after such
shares were purchased or, if earlier, upon such Participant's termination of
employment. This eighteen-month requirement may be waived by the Committee, in
its sole discretion. Until such certificates are distributed to the Participant,
the Participant will not be permitted to transfer ownership of the certificates
except as contemplated by Section 10 or Section 14 of the Plan. Any Participant
who terminates employment will receive a certificate for the whole number of
shares held in his account and a cash refund attributable to (i) any book-entry
fractional shares calculated at the closing composite sales price per share on
the NYSE on the date of distribution, and (ii) any accumulated contributions and
dividends. If for any reason the purchase of shares with a Participant's
allocations to the Plan exceeds or would exceed the Maximum Share Limitation,
such excess amounts shall be refunded to the Participant as soon as practicable
after such excess has been determined to exist.
If as of any Purchase Date the shares authorized for purchase
under the Plan are exceeded, enrollments shall be reduced proportionately to
eliminate the excess. Any funds that cannot be applied to the purchase of shares
due to excess enrollment shall be refunded as soon as administratively feasible,
excluding interest. The Committee in its discretion may also provide that excess
enrollments may be carried over to the next Purchase Period under this Plan or
any successor plan according to the regulations set forth under Section 423 of
the Code.
10. WITHDRAWAL OF SHARES AND SALE OF SHARES
(a) A Participant may elect to withdraw at any time (without
withdrawing from participation in the Plan) shares which have been held in his
account for at least eighteen (18) months by giving notice to the person
designated by the Committee on the appropriate form. Upon receipt of such notice
from the person designated by the Committee, the Custodian, bank or other
financial institution designated by the Committee for this purpose will arrange
for the issuance and delivery of such shares held in the Participant's account
as soon as administratively feasible.
(b) Notwithstanding anything in the Plan to the contrary, a Participant
may sell shares which are held in his account, including shares which have been
held in his account for less than eighteen (18) months, but not less than six
(6) months as provided in Section 8(vi) by giving notice to the person or
persons designated by the Committee on the appropriate form. Upon receipt of
such notice from the person or persons designated by the Committee, the
Custodian, bank or other financial institution designated by the Committee for
this purpose will arrange for the sale of such Participant's shares. Any sale
will be deemed to occur on the last business day of the month in which the
Participant provides such notice to the person designated by the Committee, or
at such other time as the Committee shall establish. The proceeds of any sale
under this subsection 10(b), less any associated commissions or required
withholding for taxes, shall be paid to the Participant as soon as practicable
after the sale.
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11. TERMINATION OF PARTICIPATION
The right to participate in the Plan terminates immediately
when a Participant ceases to be employed by the Company for any reason
whatsoever (including death, unpaid disability or when the Participant's
employer ceases to be a Subsidiary) or the Participant otherwise becomes
ineligible. Participation also terminates immediately when the Participant
voluntarily withdraws his contributions from the Plan. Participation terminates
immediately after the Purchase Date if the Participant is not re-enrolled in the
Plan for the next Purchase Period or if the Participant has suspended payroll
deductions during any Purchase Period and has not re-enrolled in the Plan for
the next Purchase Period. As soon as administratively feasible after termination
of participation, the Committee shall pay to the Participant or his beneficiary
or legal representative all amounts credited to his account, including
dividends, if applicable, determined in accordance with Section 7, and shall
cause a certificate for the number of shares held in his account to be delivered
to the Participant, subject to the restrictions in Section 9. For purposes of
the Plan, a Participant is not deemed to have terminated his employment if he
transfers employment from ARS to a Subsidiary, or vice versa, or transfers
employment between Subsidiaries.
12. UNPAID LEAVE OF ABSENCE
Unless the Participant has voluntarily withdrawn his
contributions from the Plan, shares will be purchased for his account on the
Purchase Date next following commencement of an unpaid leave of absence by such
Participant, provided such leave does not constitute a termination of
employment. The number of shares to be purchased will be determined by applying
to the purchase the amount of the Participant's contributions made up to the
commencement of such unpaid leave of absence. If the Participant's unpaid leave
of absence both commences and terminates during the same Purchase Period and he
has resumed eligible employment prior to the Purchase Date related to that
Purchase Period, he may also resume payroll deductions immediately, and shares
will be purchased for him on such Purchase Date as otherwise provided in Section
9.
13. DESIGNATION OF BENEFICIARY
Each Participant may designate one or more beneficiaries in
the event of death and may, in his sole discretion, change such designation at
any time. Any such designation shall be effective upon receipt by the person
designated by the Committee and shall control over any disposition by will or
otherwise.
As soon as administratively feasible after the death of a
Participant, amounts credited to his account, and any dividends, if applicable,
determined in accordance with Section 7, shall be paid in cash and a certificate
for any shares shall be delivered to the Participant's designated beneficiaries
or, in the absence of such designation, to the executor, administrator or other
legal representative of the Participant's estate. Such payment shall relieve the
Company of further liability to the deceased Participant with respect to the
Plan. If more than one beneficiary is designated, each beneficiary shall receive
an equal portion of the account unless the Participant has given express
contrary instructions.
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14. ASSIGNMENT
Except as provided in Section 13, the rights of a Participant
under the Plan will not be assignable or otherwise transferable by the
Participant, other than by will or the laws of descent and distribution or
pursuant to a "qualified domestic relations order," as defined in Section 414(p)
of the Code. No purported assignment or transfer of such rights of a Participant
under the Plan, whether voluntary or involuntary, by operation of law or
otherwise, shall vest in the purported assignee or transferee any interest or
right therein whatsoever, but immediately upon such assignment or transfer, or
any attempt to make the same, such rights shall terminate and become of no
further effect. If this provision is violated, the Participant's election to
purchase Common Stock shall terminate, and the only obligation of the Company
remaining under the Plan will be to pay to the person entitled thereto the
amount then credited to the Participant's account. No Participant may create a
lien on any funds, securities, rights or other property held for the account of
the Participant under the Plan, except to the extent that there has been a
designation of beneficiaries in accordance with the Plan, and except to the
extent permitted by will or the laws of descent and distribution if
beneficiaries have not been designated. A Participant's right to purchase shares
under the Plan shall be exercisable only during the Participant's lifetime and
only by him.
15. COSTS
All costs and expenses incurred in administering this Plan
shall be paid by the Company. Any brokerage fees for the sale of shares
purchased under the Plan shall be paid by the Participant.
16. REPORTS
As soon as administratively feasible after the end of each
Purchase Period, the Company shall provide or cause to be provided to each
Participant a report of his contributions, and the number of whole shares of
Common Stock purchased with such contributions by that Participant on each
Purchase Date.
17. EQUAL RIGHTS AND PRIVILEGES
All eligible Employees shall have equal rights and privileges
with respect to the Plan so that the Plan qualifies as an "employee stock
purchase plan" within the meaning of Section 423 or any successor provision of
the Code and related regulations. Any provision of the Plan which is
inconsistent with Section 423 or any successor provision of the Code shall
without further act or amendment by the Company be reformed to comply with the
requirements of Section 423. This Section 17 shall take precedence over all
other provisions in the Plan.
18. RIGHTS AS STOCKHOLDERS
A Participant will have no rights as a stockholder under the
election to purchase until he becomes a stockholder as herein provided. A
Participant will become a stockholder with respect
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to shares for which payment has been completed as provided in Section 9 at the
close of business on the last business day of the Purchase Period.
19. MODIFICATION AND TERMINATION
The Board may amend or terminate the Plan at any time insofar
as permitted by law. No amendment shall be effective unless within one (1) year
after it is adopted by the Board it is approved by the holders of ARS's
outstanding shares if and to the extent such amendment is required to be
approved by stockholders in order to cause the rights granted under the Plan to
purchase shares of Common Stock to meet the requirements of Section 423 of the
Code (or any successor provision).
The Plan shall terminate after all Common Stock issued under
the Plan has been purchased, unless terminated earlier by the Board or unless
additional Common Stock is issued under the Plan with the approval of the
stockholders. In the event the Plan is terminated, the Committee may elect to
terminate all outstanding rights to purchase shares under the Plan either
immediately or upon completion of the purchase of shares on the next Purchase
Date, unless the Committee has designated that the right to make all such
purchases shall expire on some other designated date occurring prior to the next
Purchase Date. If the rights to purchase shares under the Plan are terminated
prior to expiration, all funds contributed to the Plan which have not been used
to purchase shares shall be returned to the Participants as soon as
administratively feasible, including any dividends, if applicable, determined in
accordance with Section 7.
20. BOARD AND SHAREHOLDER APPROVAL; EFFECTIVE DATE
This Plan was adopted by the Board on July 20, 1998. This Plan
shall be effective as of the Effective Date. Notwithstanding the foregoing, the
adoption of this Plan is expressly conditioned upon the approval by the holders
of a majority of outstanding shares of Common Stock at the 1998 annual meeting
of stockholders. If the stockholders of the Company should fail so to approve
this Plan on or before such date, this Plan shall terminate and cease to be of
any further force or effect and all purchases of shares of Common Stock under
the Plan shall be null and void.
21. GOVERNMENTAL APPROVALS OR CONSENTS
This Plan and any offering or sale made to Employees under it
are subject to any governmental approvals or consents that may be or become
applicable in connection therewith. Subject to the provisions of Section 19, the
Board may make such changes in the Plan and include such terms in any offering
under the Plan as may be desirable to comply with the rules or regulations of
any governmental authority.
22. LISTING OF SHARES AND RELATED MATTERS
If at any time the Board or the Committee shall determine,
based on opinion of legal counsel, that the listing, registration or
qualification of the shares covered by the Plan upon any national securities
exchange or reporting system or under any state or federal law is necessary or
desirable as a condition of, or in connection with, the sale or purchase of
shares under the Plan, no
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<PAGE> 10
shares will be sold, issued or delivered unless and until such listing,
registration or qualification shall have been effected or obtained, or otherwise
provided for, free of any conditions not acceptable to legal counsel.
23. EMPLOYMENT RIGHTS
The Plan shall neither impose any obligation on ARS or on any
Subsidiary to continue the employment of any Participant, nor impose any
obligation on any Participant to remain in the employ of ARS or of any
Subsidiary.
24. WITHHOLDING OF TAXES
The Committee may make such provisions as it may deem
appropriate for the withholding of any taxes which it determines is required in
connection with the purchase of Common Stock under the Plan.
25. GOVERNING LAW
The Plan and rights to purchase shares that may be granted
hereunder shall be governed by and construed and enforced in accordance with the
laws of the state of Delaware.
26. USE OF GENDER
The gender of words used in the Plan shall be construed to
include whichever may be appropriate under any particular circumstances of the
masculine, feminine or neuter genders.
27. OTHER PROVISIONS
The agreements to purchase shares of Common Stock under the
Plan shall contain such other provisions as the Committee and the Board shall
deem advisable, provided that no such provision shall in any way be in conflict
with the terms of the Plan.
ADOPTED effective July 20, 1998.
AMERICAN RESIDENTIAL SERVICES, INC.
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EXHIBIT 5.1
[American Residential Services, Inc. Letterhead]
November 18, 1998
American Residential Services, Inc.
Post Oak Tower, Suite 725
5051 Westheimer Road
Houston, Texas 77056-5604
Gentlemen:
In connection with the Registration Statement on Form S-8 (the
"Registration Statement") being filed by American Residential Services, Inc., a
Delaware corporation (the "Company"), with the Securities and Exchange
Commission under the Securities Act of 1933, as amended, relating to 350,000
shares of common stock of the Company, par value $.001 per share ("Common
Stock") and associated rights to purchase shares of the Company's Series A
Junior Participating Preferred Stock, that may be issued pursuant to the
American Residential Services, Inc. Employee Stock Purchase Plan (the "Plan"),
certain legal matters in connection with those shares of Common Stock are being
passed on for the Company by me. At your request, this opinion is being
furnished for filing as Exhibit 5.1 to the Registration Statement.
In my capacity as General Counsel of the Company, I have examined the
Company's Restated Certificate of Incorporation and bylaws, each as amended to
date, the Registration Statement, the Plan and the originals, or copies
certified or otherwise identified, of corporate records of the Company,
certificates of public officials and of representatives of the Company, statutes
and other instruments and documents as a basis for the opinions hereinafter
expressed. In connection with this opinion, I have relied on certificates of
officers of the Company with respect to the accuracy of material factual matters
contained on or covered by the certificates referred to above.
Based on and subject to the foregoing, I am of the opinion that:
1. The Company is a corporation duly organized and validly existing
in good standing under the laws of the State of Delaware.
2. On the issuance of shares of Common Stock pursuant to the
provisions of the Plan, those shares of Common Stock will be duly
authorized by all necessary corporate action on the part of the Company,
validly issued, fully paid and nonassesable.
The opinions expressed herein relate solely to, are based solely upon and
are limited exclusively to the General Corporation Law of the State of Delaware
and the federal laws of the United States of America, to the extent applicable.
I hereby consent to the filing of this opinion as an exhibit to the
Registration Statement.
Very truly yours,
/s/ John D. Held
John D. Held
<PAGE> 1
EXHIBIT 23.1
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation
by reference in this registration statement of our report dated March 18, 1998
included in American Residential Services, Inc.'s Form 10-K for the year ended
December 31, 1997, and to all references to our Firm included in this
Registration Statement.
/s/ ARTHUR ANDERSEN LLP
ARTHUR ANDERSEN LLP
Houston, Texas
November 24, 1998
<PAGE> 1
EXHIBIT 23.2
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation
by reference in this registration statement of our report dated July 3, 1998
included in American Residential Services, Inc.'s Form 8-K/A filed July 24,
1998, and to all references to our Firm included in this Registration Statement.
/s/ Watkins, Meegan, Drury & Company, L.L.C.
WATKINS, MEEGAN, DRURY & COMPANY, L.L.C.
Bethesda, Maryland
November 20, 1998
