<PAGE> 1
-------------------
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
-------------------
SCHEDULE 13D
Under the Securities Exchange Act of 1934
AMERICAN RESIDENTIAL SERVICES, INC.
(Name of Issuer)
-------------------
COMMON STOCK, PAR VALUE $.001 PER SHARE
(Title of Class of Securities)
028911 10 5
(CUSIP Number)
-------------------
CONSOLIDATION EXPERTS LP
5051 WESTHEIMER ROAD, SUITE 1890
HOUSTON, TEXAS 77056-5604
(713) 572-1833
(Name, Address and Telephone Number
of Person Authorized to Receive Notices
and Communications)
-------------------
JANUARY 5, 1999
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a
statement on Schedule 13G to report this
acquisition that is
the subject of this Schedule 13D, and is filing
this schedule because of Rule 13d-1(b)(3) or (4),
check the following box: [ ].
-------------------
Page 1 of 17 Pages.
<PAGE> 2
Page 2 of 17 Pages
CUSIP NO.: 028911 10 5
-----------
SCHEDULE 13D
================================================================================
1 NAME OF REPORTING PERSON; S.S. OR IRS IDENTIFICATION NUMBER
Consolidation Experts LP
- --------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) [XX]
(b) [ ]
- --------------------------------------------------------------------------------
3 SEC USE ONLY
- --------------------------------------------------------------------------------
4 SOURCE OF FUNDS
OO
- --------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEM 2(D) OR 2(E)
[ ]
- --------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
DELAWARE
- --------------------------------------------------------------------------------
7 Sole Voting Power
0
- --------------------------------------------------------------------------------
8 SHARED VOTING POWER
0
- --------------------------------------------------------------------------------
9 SOLE DISPOSITIVE POWER
0
- --------------------------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
0
- --------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
31,373 (See Item 5)
- --------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES
[ ]
- --------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
.20% (See Item 5)
- --------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON
PN
================================================================================
<PAGE> 3
Page 3 of 17 Pages
CUSIP NO.: 028911 10 5
-----------
SCHEDULE 13D
================================================================================
1 NAME OF REPORTING PERSON; S.S. OR IRS IDENTIFICATION NUMBER
Consolidation Experts LLC
- --------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) [XX]
(b) [ ]
- --------------------------------------------------------------------------------
3 SEC USE ONLY
- --------------------------------------------------------------------------------
4 SOURCE OF FUNDS
OO
- --------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEM 2(D) OR 2(E)
[ ]
- --------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
DELAWARE
- --------------------------------------------------------------------------------
7 Sole Voting Power
0
- --------------------------------------------------------------------------------
8 SHARED VOTING POWER
0
- --------------------------------------------------------------------------------
9 SOLE DISPOSITIVE POWER
0
- --------------------------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
0
- --------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
30 (See Item 5)
- --------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES
[ ]
- --------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
0.00%* (See Item 5)
- --------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON
CO
================================================================================
*Less than 0.01%.
<PAGE> 4
Page 4 of 17 Pages
CUSIP NO.: 028911 10 5
-----------
SCHEDULE 13D
================================================================================
1 NAME OF REPORTING PERSON; S.S. OR IRS IDENTIFICATION NUMBER
C. Clifford Wright, Jr.
- --------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) [XX]
(b) [ ]
- --------------------------------------------------------------------------------
3 SEC USE ONLY
4 SOURCE OF FUNDS
PF
- --------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEM 2(D) OR 2(E)
[ ]
- --------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States
- --------------------------------------------------------------------------------
7 Sole Voting Power
200,456
- --------------------------------------------------------------------------------
8 SHARED VOTING POWER
0
- --------------------------------------------------------------------------------
9 SOLE DISPOSITIVE POWER
200,456
- --------------------------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
0
- --------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
454,607 (See Item 5)
- --------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES
[ ]
- --------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
2.86% (See Item 5)
- --------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON
IN
================================================================================
<PAGE> 5
Page 5 of 17 Pages
CUSIP NO.: 028911 10 5
-----------
SCHEDULE 13D
================================================================================
1 NAME OF REPORTING PERSON; S.S. OR IRS IDENTIFICATION NUMBER
William P. McCaughey
- --------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) [XX]
(b) [ ]
- --------------------------------------------------------------------------------
3 SEC USE ONLY
- --------------------------------------------------------------------------------
4 SOURCE OF FUNDS
PF
- --------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEM 2(D) OR 2(E)
[ ]
- --------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States
- --------------------------------------------------------------------------------
7 Sole Voting Power
200,730
- --------------------------------------------------------------------------------
8 SHARED VOTING POWER
0
- --------------------------------------------------------------------------------
9 SOLE DISPOSITIVE POWER
200,730
- --------------------------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
0
- --------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
340,631 (See Item 5)
- --------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES
[ ]
- --------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
2.14% (See Item 5)
- --------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON
IN
================================================================================
<PAGE> 6
Page 6 of 17 Pages
CUSIP NO.: 028911 10 5
-----------
SCHEDULE 13D
================================================================================
1 NAME OF REPORTING PERSON; S.S. OR IRS IDENTIFICATION NUMBER
Ronald R. McCann
- --------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) [XX]
(b) [ ]
- --------------------------------------------------------------------------------
3 SEC USE ONLY
- --------------------------------------------------------------------------------
4 SOURCE OF FUNDS
PF
- --------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEM 2(D) OR 2(E)
[ ]
- --------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States
- --------------------------------------------------------------------------------
7 Sole Voting Power
202,000
- --------------------------------------------------------------------------------
8 SHARED VOTING POWER
0
- --------------------------------------------------------------------------------
9 SOLE DISPOSITIVE POWER
202,000
- --------------------------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
0
- --------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
244,000 (See Item 5)
- --------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES
[ ]
- --------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
1.53% (See Item 5)
- --------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON
IN
================================================================================
<PAGE> 7
Page 7 of 17 Pages
CUSIP NO.: 028911 10 5
-----------
SCHEDULE 13D
================================================================================
1 NAME OF REPORTING PERSON; S.S. OR IRS IDENTIFICATION NUMBER
Wes Lewis
- --------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) [XX]
(b) [ ]
- --------------------------------------------------------------------------------
3 SEC USE ONLY
- --------------------------------------------------------------------------------
4 SOURCE OF FUNDS
PF
- --------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEM 2(D) OR 2(E)
[ ]
- --------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States
- --------------------------------------------------------------------------------
7 Sole Voting Power
318,239
- --------------------------------------------------------------------------------
8 SHARED VOTING POWER
0
- --------------------------------------------------------------------------------
9 SOLE DISPOSITIVE POWER
318,239
- --------------------------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
0
- --------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
318,639 (See Item 5)
- --------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES
[ ]
- --------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
2.00% (See Item 5)
- --------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON
IN
================================================================================
<PAGE> 8
Page 8 of 17 Pages
CUSIP NO.: 028911 10 5
-----------
SCHEDULE 13D
================================================================================
1 NAME OF REPORTING PERSON; S.S. OR IRS IDENTIFICATION NUMBER
A. Jefferson Walker
- --------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) [XX]
(b) [ ]
- --------------------------------------------------------------------------------
3 SEC USE ONLY
- --------------------------------------------------------------------------------
4 SOURCE OF FUNDS
PF
- --------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEM 2(D) OR 2(E)
[ ]
- --------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States
- --------------------------------------------------------------------------------
7 Sole Voting Power
3,166
- --------------------------------------------------------------------------------
8 SHARED VOTING POWER
0
- --------------------------------------------------------------------------------
9 SOLE DISPOSITIVE POWER
3,166
- --------------------------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
0
- --------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
29,766 (See Item 5)
- --------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES
[ ]
- --------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
0.19% (See Item 5)
- --------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON
IN
================================================================================
<PAGE> 9
Page 9 of 17 Pages
CUSIP NO.: 028911 10 5
-----------
SCHEDULE 13D
================================================================================
1 NAME OF REPORTING PERSON; S.S. OR IRS IDENTIFICATION NUMBER
Rosario P. Schembari
- --------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) [XX]
(b) [ ]
- --------------------------------------------------------------------------------
3 SEC USE ONLY
- --------------------------------------------------------------------------------
4 SOURCE OF FUNDS
PF
- --------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEM 2(D) OR 2(E)
[ ]
- --------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States
- --------------------------------------------------------------------------------
7 Sole Voting Power
5,085
- --------------------------------------------------------------------------------
8 SHARED VOTING POWER
0
- --------------------------------------------------------------------------------
9 SOLE DISPOSITIVE POWER
5,085
- --------------------------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
0
- --------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
31,751 (See Item 5)
- --------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES
[ ]
- --------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
0.20% (See Item 5)
- --------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON
IN
================================================================================
<PAGE> 10
Page 10 of 17 Pages
SCHEDULE 13D
Item 1. Security and Issuer.
This Statement on Schedule 13D is being filed by Consolidation Experts
LP, Consolidation Experts LLC, C. Clifford Wright, Jr., William P. McCaughey,
Ronald R. McCann, Wes Lewis, A Jefferson Walker III and Rosario P. Schembari
(sometimes individually, a "Reporting Person," and collectively, the "Reporting
Persons"), who may be deemed to comprise a group under Rule 13d-5(b) of the
Securities Exchange Act of 1934, as amended ("Exchange Act").
This Statement on Schedule 13D relates to the beneficial ownership of
shares of common stock, par value $.001 per share (together with associated
common stock purchase rights, "Common Stock"), of American Residential Services,
Inc., a Delaware corporation ("ARS"). The principal executive offices of ARS are
located at Post Oak Tower, Suite 725, 5051 Westheimer Road, Houston, Texas
77056-5604.
Item 2. Identity and Background.
(a)-(c) The name, business address and principal occupation of each
Reporting Person and the name, principal business and address of the corporation
in which each Reporting Person's employment is conducted are set forth in
Schedule I to this Statement on Schedule 13D.
(d) During the past five years, none of the Reporting Persons has been
convicted in a criminal proceeding (excluding traffic violations or similar
misdemeanors).
(e) During the past five years, none of the Reporting Persons has been
a party to a civil proceeding of a judicial or administrative body of competent
jurisdiction and as a result of such proceeding was or is subject to a judgment,
decree or final order enjoining future violations of, or prohibiting or
mandating activities subject to, federal or state securities laws or finding any
violation with respect to such laws.
(f) Each of the Reporting Persons is a citizen of the United States.
Item 3. Source and Amount of Funds or Other Consideration.
Consolidation Experts LP, a Delaware limited partnership
("Consolidation Experts"), whose sole general partner is Consolidation Experts
LLC, a Delaware limited liability company ("Experts LLC") acquired $800,000
principal amount of 7 1/4% Convertible Subordinated Notes due 2004 ("Notes") on
November 17, 1998 for $365,156 that are convertible into shares of Common Stock
at a conversion price of $25.50 per share. By virtue of the respective ownership
interests of Consolidation Experts, Experts LLC is the beneficial owner of 0.1%
of the Notes and each of Mr. Wright and Mr. McCaughey, respectively, is the
beneficial owner of 49.95% of the Notes.
Mr. Wright acquired 158,431 shares of Common Stock (adjusted for a
subsequent stock split) for nominal consideration upon the initial
capitalization of ARS in October 1995 and acquired an additional 52,300 shares
of Common Stock upon ARS's acquisition of a company in which he owned an
interest concurrently with the consummation of ARS's initial public offering in
September 1996. Mr. Wright also (a) holds (i) fully vested options expiring on
January 31, 2006 to purchase an aggregate of 200,000 shares of Common Stock at a
price of $8.00 per share, (ii) options expiring on June 3, 2007 to purchase an
aggregate of 37,500 shares of Common Stock at
<PAGE> 11
Page 11 of 17 Pages
a price of $21.625 per share, of which options to purchase 7,500 shares are
vested and the balance vests in equal annual increments on June 3 in each year
through 2002 and (iii) options expiring on October 31, 2000 to purchase an
aggregate of 69,364 shares of Common Stock at a price of $24.00 per share, of
which options to purchase 23,122 shares are vested and the balance vests in
essentially equal annual increments on April 30 in each year through 2000; (b)
holds 456 shares of Common Stock in a 401(k) plan; and (c) owns $200,000
principal amount of Notes that are convertible into shares of Common Stock at a
conversion price of $25.50 per share.
Mr. McCaughey acquired 158,431 shares of Common Stock (adjusted for a
subsequent stock split) for nominal consideration upon the initial
capitalization of ARS in October 1995 and acquired an additional 52,300 shares
of Common Stock upon ARS's acquisition of a company in which he owned an
interest concurrently with the consummation of ARS's initial public offering in
September 1996. Mr. McCaughey also (a) holds (i) fully vested options expiring
on January 31, 2006 to purchase an aggregate of 120,000 shares of Common Stock
at $8.00 per share and (ii) options expiring on July 1, 2007 to purchase an
aggregate of 5,000 shares of Common Stock at a price of $22.813 per share, of
which options to purchase 1,666 shares are fully vested and the balance vests in
essentially equal annual increments on July 1 in each year through 2000; and (b)
owns $65,000 principal amount of Notes that are convertible into shares of
Common Stock at a conversion price of $25.50 per share.
Mr. McCann acquired 2,000 shares of Common Stock for $15.00 per share
in September 1996, and acquired an additional 200,000 shares of Common Stock
upon ARS's acquisition in October 1996 of a company in which he owned an
interest. Mr. McCann also holds (a) options expiring on October 31, 2006 to
purchase an aggregate of 25,000 shares of Common Stock at a price of $19.00 per
share, of which options to purchase 15,000 shares are fully vested and the
balance vests in essentially equal annual increments on October 31 in each year
through 2000; (b) fully vested options expiring on January 14, 2007 to purchase
an aggregate of 25,000 shares of Common Stock at a price of $25.75 per share;
and (c) options expiring on June 3, 2007 to purchase an aggregate of 10,000
shares of Common Stock at a price of $21.625 per share, of which options to
purchase 2,000 shares are vested and the balance vests in essentially equal
annual increments on June 3 in each year through 2002.
Mr. Lewis acquired 318,239 shares of Common Stock upon ARS's
acquisition in March 1997 of a company in which he owned an interest. Mr. Lewis
also holds (a) options expiring on June 17, 2007 to purchase an aggregate of
2,000 shares of Common Stock at a price of $19.125 per share, of which options
to purchase 400 shares are fully vested and the balance vests in essentially
equal annual increments on April 2 in each year through 2002.
Mr. Walker acquired 3,166 shares of Common Stock for services rendered
in connection with the initial public offering of ARS in September 1996. Mr.
Walker also holds (a) fully vested options expiring on January 31, 2006 to
purchase an aggregate of 24,000 shares of Common Stock at a price of $8.00 per
share; (b) options expiring on June 3, 2007 to purchase an aggregate of 7,300
shares of Common Stock at a price of $21.625 per share, of which options to
purchase 1,460 shares
<PAGE> 12
Page 12 of 17 Pages
are fully vested and the balance vests in equal annual increments on June 3 in
each year through 2002; (c) options expiring on November 13, 2007 to purchase an
aggregate of 2,900 shares of Common Stock at a price of $13.469 per share, of
which options to purchase 580 shares are fully vested and the balance vests in
equal annual increments on November 13 in each year through 2002; and (d)
options expiring on July 20, 2008 to purchase an aggregate of 2,800 shares of
Common Stock at a price of $9.594 per share, of which options to purchase 560
shares are vested and the balance vests in essentially equal annual increments
on July 20 in each year through 2003.
Mr. Schembari purchased 5,000 shares of Common Stock on December 15,
1998 at $5.41 per share. Mr. Schembari also holds (a) options expiring on June
5, 2002, to purchase an aggregate 40,000 shares of Common Stock at a price of
18.625 per share, of which options to purchase 26,666 shares are fully vested
and the balance vests on June 6, 1999; and (b) holds 85 shares of Common Stock
in a 401(k) plan.
See paragraph (c) of Item 5 of this Statement on Schedule 13D for
information relating to recent additional purchases of shares of Common Stock by
the Reporting Persons with personal funds.
Item 4. Purpose of Transaction.
Messrs. Wright and McCaughey are former officers, directors and
co-founders of ARS. Mr. Wright resigned as the President, Chief Executive
Officer and a director of ARS effective October 31, 1997. Mr. McCaughey tendered
his resignation as Executive Vice President and Chief Financial Officer of ARS
on January 15, 1997, effective April 1, 1997, and resigned as a director of ARS
on May 22, 1998. Following their resignations as officers of ARS, Messrs. Wright
and McCaughey founded Consolidation Experts to engage in the consolidation of
companies in highly fragmented industries. Messrs. Wright and McCaughey each own
a 49.95% limited partnership interest in Consolidation Experts.
Mssrs. McCann and Walker are former officers of ARS. Mr.
McCann tendered his resignation as Vice President of Human
Resources and Planning effective November 17, 1998. Mr. Walker
was Treasurer of ARS from April 1996 to December 1998.
Messrs. Lewis and Schembari each held interests in companies
acquired by ARS.
The Reporting Persons believe that there has been substantial erosion
in the value of the Common Stock during recent periods and want the board of ARS
to explore the feasibility of multiple alternatives for the enhancement of
stockholder value, including, without limitation, the possible sale of ARS, the
sale of one or more subsidiaries of ARS, the acquisition of all the outstanding
capital stock of ARS and a change in the composition of the board of ARS. In
pursuit of this objective, the Reporting Persons intend to engage in discussions
with other persons who may be dissatisfied with the current board's operating
policies and efforts to enhance stockholder value.
<PAGE> 13
Page 13 of 17 Pages
Except as noted herein or as otherwise set forth in Exhibit B hereto,
the Reporting Persons have not formulated any plans or proposals which relate to
or would result in:
(a) the acquisition by any person of additional securities of ARS, or
the disposition of securities of ARS;
(b) an extraordinary corporate transaction, such as a merger,
reorganization or liquidation, involving ARS or any of its subsidiaries;
(c) a sale or transfer of a material amount of assets of ARS or any of
its subsidiaries;
(d) any change in the present board of directors or management of ARS,
including any plans or proposals to change the number of term of directors or to
fill any existing vacancies on the board;
(e) any material change in the present capitalization or dividend
policy of ARS;
(f) any other material change in ARS's business or corporate structure;
(g) changes in ARS's charter or bylaws or other actions which may
impede the acquisition of control of ARS by any person;
(h) causing a class of securities of ARS to be delisted from a national
securities exchange or to cease to be authorized to be quoted in an inter-dealer
quotation system of a registered national securities association;
(i) a class of equity securities of ATS becoming eligible for
termination of registration pursuant to Section 12(g)(4) of the Exchange Act; or
(j) any action similar to any of those enumerated above.
There will continue to be a review of ARS's situation and possible
methods by which the Reporting Persons and, possibly, others may be able to
influence ARS's future course with a goal of improving ARS's operations and
financial condition as well as stockholder value. The Reporting Persons reserve
the right to (i) modify their present intentions and formulate plans or
proposals to take any one or more of the actions referred to in paragraph (a)
through (j) above and (ii) to increase or decrease their respective holdings of
Common Stock through open market purchases, privately negotiated transactions or
otherwise.
Item 5. Interest in Securities of the Issuer
(a) and (b) The number of shares of Common Stock beneficially owned by
each Reporting Person and the number of shares of Common Stock as to which each
Reporting Person has sole
<PAGE> 14
Page 14 of 17 Pages
power to vote or to direct the vote, shared power to vote or direct the vote,
sole power to dispose or to direct the disposition and shared power to dispose
or to direct the disposition are set forth on the cover pages of this Statement
on Schedule 13D, and such information is incorporated herein by reference.
(c) Except for (i) the purchase by Consolidation Experts LP of $800,000
principal amount of Notes on November 17, 1998 for $365,156 and (ii) the
purchase by Mr. Schembari of 5,000 shares of Common Stock on December 15, 1998,
the Reporting Persons have not acquired any shares of Common Stock or securities
convertible into Common Stock during the past sixty days.
(d) Each Reporting Person has the right to receive the dividends from,
and the proceeds from the sale of, the respective shares of Common Stock
reported by each such person on the cover pages of this Statement on Schedule
13D.
Item 6. Contracts, Arrangements, Understandings or Relationships
with Respect to Securities of the Issuer.
Except as otherwise referred to in Item 3 and Item 4 of this Statement
on Schedule 13D, there are no contracts, arrangements, understandings or
relationships (legal or otherwise) among the Reporting Persons and between the
Reporting Persons and any person with respect to the shares of Common Stock or
any other securities of ARS.
Item 7. Material to be Filed as Exhibits.
A. Joint Filing Agreement dated as of January 14, 1999.
B. Letter on behalf of Reporting Persons to Board of
Directors of American Residential Services, Inc. dated
January 14, 1999.
<PAGE> 15
Page 15 of 17 Pages
SIGNATURES
After reasonable inquiry and to the best of each of the undersigned's
knowledge and belief, each of the undersigned hereby certifies that the
information set forth in this statement is true, complete and correct.
Dated: January 14, 1999.
Consolidation Experts LP,
by its General Partner
Consolidation Experts LLC
By: /s/ C. Clifford Wright, Jr.
-------------------------------
Name: C. Clifford Wright, Jr.
Title: Authorized Representative
/s/ C. Clifford Wright, Jr.
----------------------------------
C. Clifford Wright, Jr.
/s/ William P. McCaughey
----------------------------------
William P. McCaughey
/s/ Ronald R. McCann
----------------------------------
Ronald R. McCann
/s/ Wes Lewis
----------------------------------
Wes Lewis
----------------------------------
/s/ A. Jefferson Walker III
----------------------------------
A. Jefferson Walker III
/s/ Rosario P. Schembari
----------------------------------
Rosario P. Schembari
<PAGE> 16
Page 16 of 17 Pages
SCHEDULE I
<TABLE>
<CAPTION>
REPORTING PERSON BUSINESS ADDRESS PRINCIPAL OCCUPATION
- ---------------- ---------------- --------------------
<S> <C> <C>
Consolidation Experts LP 5051 Westheimer Not Applicable
Suite 1890
Houston, TX 77056-5604
C. Clifford Wright, Jr. 5051 Westheimer Managing Director -
Suite 1890 Consolidation Experts LP, a
Houston, TX 77056-5604 sponsor of consolidations in
highly fragmented industries
William P. McCaughey 5051 Westheimer Managing Director -
Suite 1890 Consolidation Experts LP,
Houston, TX a sponsor of consolidations
77056-5604 in highly fragmented industries
Ronald R. McCann 5051 Westheimer Investor
Suite 1890
Houston, TX 77056-5604
Wes Lewis 1515 McMillan Investor
Oklahoma City, OK 73127
A. Jefferson Walker III 16103 Jast Drive Investor
Cypress, TX 77429
Rosario P. Schembari 1270 Lincoln Ave. President, HVAC Performance
Suite 1400 Products, Inc., manufacturers
Pasadena, CA 91103 and distributors of air
purification products
</TABLE>
<PAGE> 17
Page 17 of 17 Pages
EXHIBIT INDEX
A. Joint Filing Agreement dated as of January 14, 1999.
B. Letter on behalf of Reporting Persons to Board of
Directors of American Residential Services, Inc. dated
January 14, 1999.
<PAGE> 1
EXHIBIT A
JOINT FILING AGREEMENT
In accordance with Rule 13d-1(f) under the Securities Exchange Act of
1934, as amended, the undersigned hereby agree to the joint filing with all
other Reporting Persons (as such term is defined in the Schedule 13D referred to
below), on behalf of each of them a statement on Schedule 13D (including any and
all amendments thereto) with respect to the Common Stock, par value $.001 per
share, of American Residential Services, Inc. and that this Joint Filing
Agreement be included as an Exhibit to such Schedule 13D filing. This Agreement
may be executed in any number of counterparts all of which taken together shall
constitute one and the same instrument.
IN WITNESS WHEREOF, the undersigned hereby execute this Joint Filing
Agreement this 14th day of January, 1999.
Consolidation Experts LP,
by its General Partner
Consolidation Experts LLC
By: /s/ C. Clifford Wright, Jr.
-------------------------------
Name: C. Clifford Wright, Jr.
Title: Authorized Representative
/s/ C. Clifford Wright, Jr.
----------------------------------
C. Clifford Wright, Jr.
/s/ William P. McCaughey
----------------------------------
William P. McCaughey
/s/ Ronald R. McCann
----------------------------------
Ronald R. McCann
/s/ Wes Lewis
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Wes Lewis
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/s/ A. Jefferson Walker III
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A. Jefferson Walker III
/s/ Rosario P. Schembari
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Rosario P. Schembari
<PAGE> 1
EXHIBIT B
[Letterhead of Consolidation Experts LP]
January 14, 1999
Board of Directors
American Residential Services, Inc.
5051 Westheimer, Suite 725
Houston, TX 725
Gentlemen:
As indicated in our Schedule 13-D, which was filed with the SEC on January 14,
1999, the reporting persons beneficially own approximately 9% of ARS's
outstanding common stock.
We are writing to you to express our deep concern regarding the lack of
strategic direction and leadership of the Company. Since October 31, 1997 when
the current management team was installed:
o The stock price has declined 81% from $14.625 to $2.75, representing a
loss in shareholder value of approximately $189 million. During this
period, the S&P 500 increased 39% and the Company's peer group (Comfort
Systems, Group Maintenance America and Service Experts) rose 5.7%.
o The Company has lost credibility with shareholders and the investment
community by missing quarterly earnings expectations and incurring
several "one-time charges."
o Since June 1998, the chief operating officer position has been vacant.
With no officer to focus on integrating operations, operating income
margins for the nine months ended September 30, 1998 were 4.8%, compared
to 8.1% for the prior year period.
We strongly believe that the Board of Directors must hold present management
accountable for the underperformance of the company, in terms of both
stockholder returns and operating performance. At a time when the stock market
is reaching new all-time highs and the Company's competitors are meeting
expectations, the Company's continuing poor performance must be reversed.
Substantial opportunities exist to create value for stockholders. We believe
that the immediate implementation of the following suggestions will position the
Company to begin restoring confidence in the investment community and thereby
initiating a process that should ultimately result in an enhancement of
stockholder value.
1. Immediately elect C. Clifford Wright, Jr., Acting Chairman of the
Board and Acting Chief Executive Officer of the Company. Mr. Wright
intends to serve only until an experienced CEO can be recruited. We
have had substantive discussions with prospective CEO candidates with
the skills, including leadership qualities and turnaround expertise,
necessary to reverse ARS's direction.
<PAGE> 2
2. Messrs. Amonett, Hoover, Menditch and Sokolow should immediately
resign from the Company's Board of Directors.
3. Allow the newly elected CEO to repopulate the Company's executive
ranks with persons selected by him.
4. The undersigned will designate a person to be elected to the Company's
Board of Directors.
5. The nominating committee of the Board of Directors will be comprised
of the CEO, the director referred to in numbered paragraph 4 above and
one current non-employee director.
While these recommendations are fundamental to the restoration and ultimate
enhancement of stockholder value, they are only a start. Tangible action is
required to evidence that the Company's Board is prepared to take the necessary
steps to put an end to the steady decline in stockholder value. If these
suggestions, or mutually agreeable alternative steps, are not undertaken by
January 29, 1999, we will be compelled to become activist stockholders.
We hope that our suggestions are in line with the Board's current plans, and
look forward to an open and productive dialogue that best serves the interest of
all shareholders.
Sincerely,
Consolidation Experts LP, by
Consolidation Experts LLC
/s/ C. Clifford Wright, Jr.
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By: C. Clifford Wright, Jr.
Title: Authorized Representative
