Exhibit 10.1
Stewart Enterprises, Inc.
and the Guarantors
Listed on Schedule A hereto
$250,000,000
$125,000,000 3.125% Senior Convertible Notes due July 15, 2014
$125,000,000 3.375% Senior Convertible Notes due July 15, 2016
Purchase Agreement
dated June 21, 2007
Merrill Lynch, Pierce, Fenner & Smith Incorporated
Banc of America Securities LLC
BNP Paribas Securities Corp.
Calyon Securities (USA) Inc.
Capital One Southcoast, Inc.
SunTrust Capital Markets, Inc.
U.S. Bancorp Investments, Inc.

 

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Table of Contents

                              Page   Section 1.   Representations and Warranties
    3  
 
  (a)   No Registration Required     3  
 
  (b)   No Integration of Offerings or General Solicitation     3  
 
  (c)   Eligibility for Resale Under Rule 144A     4  
 
  (d)   Disclosure Package and Final Offering Memorandum     4  
 
  (e)   Incorporated Documents     4  
 
  (f)   The Purchase Agreement     5  
 
  (g)   The Registration Rights Agreement     5  
 
  (h)   The DTC Letter of Representations     5  
 
  (i)   Authorization of the Notes and the Guarantees     5  
 
  (j)   Authorization of the Indentures     6  
 
  (k)   Authorization of Common Stock     6  
 
  (l)   Descriptions of Notes and the Indentures     6  
 
  (m)   No Material Adverse Change     6  
 
  (n)   Independent Accountants     7  
 
  (o)   Preparation of the Financial Statements     7  
 
  (p)   Incorporation and Good Standing of the Company and its Subsidiaries    
7  
 
  (q)   Capitalization and Other Capital Stock Matters     8  
 
  (r)   Stock Exchange Listing     8  
 
  (s)   Non-Contravention of Existing Instruments; No Further Authorizations or
       
 
      Approvals Required     8  
 
  (t)   No Material Actions or Proceedings     9  
 
  (u)   Intellectual Property Rights     9  
 
  (v)   All Necessary Permits, Etc     10  
 
  (w)   Title to Properties     10  
 
  (x)   Tax Law Compliance     10  
 
  (y)   Company Not an “Investment Company”     10  
 
  (z)   Insurance     11  
 
  (aa)   No Price Stabilization or Manipulation     11  
 
  (bb)   Solvency     11  
 
  (cc)   No Unlawful Contributions or Other Payments     11  
 
  (dd)   Accounting Controls and Disclosure Controls     11  
 
  (ee)   Compliance with the Sarbanes-Oxley Act     12  
 
  (ff)   Compliance with Environmental Laws     12  
 
  (gg)   ERISA Compliance     13  
 
  (hh)   Taxes; Fees     13  
 
  (ii)   No Labor Disputes     13  
 
  (jj)   No Default in Indebtedness     14  
 
  (kk)   Excluded Domestic Subsidiaries     14  
 
                Section 2.   Purchase, Sale and Delivery of the Securities    
14  
 
  (a)   The Securities     14  
 
  (b)   Delivery of Securities; Payment     14  

 

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                              Page  
 
  (c)   Denominations; Registration     15  
 
  (d)   Initial Purchasers as Qualified Institutional Buyers     15  
 
                Section 3.   Additional Covenants     15  
 
  (a)   Notice and Effect of Material Events     15  
 
  (b)   Amendments and Supplements to the Offering Memorandum     15  
 
  (c)   Copies of the Disclosure Package and the Final Offering Memorandum    
16  
 
  (d)   Blue Sky Compliance     16  
 
  (e)   Use of Proceeds     16  
 
  (f)   Depositary     16  
 
  (g)   Additional Issuer Information     17  
 
  (h)   Restriction on Sale of Securities     17  
 
  (i)   Future Reports to the Initial Purchasers     17  
 
  (j)   No Integration     18  
 
  (k)   Legended Securities     18  
 
  (l)   PORTAL     18  
 
  (m)   Rating of Securities     18  
 
  (n)   Reservation of Shares of Common Stock     18  
 
  (o)   No Other Offering Documents     18  
 
                Section 4.   Payment of Expenses     19  
 
                Section 5.   Conditions of the Obligations of the Initial
Purchasers     19  
 
  (a)   Accountants’ Comfort Letter     19  
 
  (b)   No Material Adverse Change or Ratings Agency Change     20  
 
  (c)   Opinion of Counsel for the Company and the Guarantors     20  
 
  (d)   Opinion of Local Counsel for the Guarantors     20  
 
  (e)   Opinion of Special Counsel for the Company and the Guarantors     20  
 
  (f)   Opinion of Counsel for the Initial Purchasers     20  
 
  (g)   Officers’ Certificate     20  
 
  (h)   Bring-down Comfort Letter     21  
 
  (i)   PORTAL Listing     21  
 
  (j)   Registration Rights Agreement     21  
 
  (k)   Lock-up Agreements     21  
 
  (l)   Additional Documents     21  
 
                Section 6.   Reimbursement of Initial Purchasers’ Expenses    
21  
 
                Section 7.   Offer, Sale and Resale Procedures     22  
 
  (a)   Offers and Sales Only to Qualified Institutional Buyers     22  
 
  (b)   No General Solicitation     22  
 
  (c)   Restrictions on Transfer     22  
 
                Section 8.   Indemnification     22  
 
  (a)   Indemnification of the Initial Purchasers     22  
 
  (b)   Indemnification of the Company, the Guarantors and each of their        
 
      Directors and Officers     23  

ii

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                              Page  
 
  (c)   Notifications and Other Indemnification Procedures     24  
 
  (d)   Settlements     25  
 
                Section 9.   Contribution     25  
 
                Section 10.   Termination of this Agreement     26  
 
                Section 11.   Representations and Indemnities to Survive
Delivery     27  
 
                Section 12.   Notices     27  
 
                Section 13.   Successors     28  
 
                Section 14.   Partial Unenforceability     28  
 
                Section 15.   Governing Law; Consent to Jurisdiction     28  
 
  (a)   Governing Law Provisions     28  
 
  (b)   Consent to Jurisdiction     29  
 
                Section 16.   Default of One or More of the Several Initial
Purchasers     29  
 
                Section 17.   No Advisory or Fiduciary Relationship     30  
 
                Section 18.   General Provisions     30  

         
SCHEDULE A
  -   List of Guarantors
SCHEDULE B
  -   Initial Purchasers
SCHEDULE C
  -   Pricing Term Sheet
SCHEDULE D
  -   Subsidiaries of Stewart Enterprises, Inc.
SCHEDULE E
  -   Excluded Domestic Subsidiaries
SCHEDULE F
  -   Local Counsel for the Guarantors
SCHEDULE G
  -   List of Persons Subject to Lock-Up
EXHIBIT A
  -   Form of Registration Rights Agreement
EXHIBIT B
  -   Form of Opinion of Counsel for the Company
EXHIBIT C
  -   Form of Opinion of Local Counsel for the Company
EXHIBIT D
  -   Form of Opinion of Special Counsel for the Company
EXHIBIT E
  -   Form of Lock-Up Agreement

iii

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Purchase Agreement
June 21, 2007
MERRILL LYNCH & CO.
MERRILL LYNCH, PIERCE, FENNER & SMITH
                    INCORPORATED
BANC OF AMERICA SECURITIES LLC
BNP PARIBAS SECURITIES CORP.
CALYON SECURITIES (USA) INC.
CAPITAL ONE SOUTHCOAST, INC.
SUNTRUST CAPITAL MARKETS, INC.
U.S. BANCORP INVESTMENTS, INC.
           as Initial Purchasers
c/o MERRILL LYNCH, PIERCE, FENNER & SMITH
                    INCORPORATED
4 World Financial Center
New York, NY 10018
Ladies and Gentlemen:
          Stewart Enterprises, Inc., a Louisiana corporation (the “Company”),
proposes to issue and sell to Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner
& Smith Incorporated (“Merrill Lynch”) and each of the other initial purchasers
named in Schedule B (collectively, the “Initial Purchasers,” which term shall
also include any initial purchaser substituted as provided in Section 16
hereof), acting severally and not jointly, the respective amounts set forth in
such Schedule B of $125,000,000 aggregate principal amount of the Company’s
3.125% Senior Convertible Notes due July 15, 2014 (the “2014 Notes”) and
$125,000,000 aggregate principal amount of the Company’s 3.375% Senior
Convertible Notes due July 15, 2016 (the “2016 Notes” and, together with the
2014 Notes, the “Notes”). Merrill Lynch has agreed to act as representative of
the several Initial Purchasers in connection with the offering and sale of the
Notes.
          The Notes will be issued pursuant to separate indentures to be dated
as of June 27, 2007 (each an “Indenture” and collectively, the “Indentures”),
between the Company and U.S. Bank National Association, as trustee (the
“Trustee”). Notes issued in book-entry form will be issued in the name of Cede &
Co., as nominee of The Depository Trust Company (the “Depositary”) pursuant to a
blanket letter of representations (the “DTC Letter of Representations”), between
the Company and the Depositary.
          The Notes are convertible, subject to certain conditions as described
in the Final Offering Memorandum (as defined below), prior to maturity (unless
previously redeemed or otherwise purchased) into cash and shares of Class A
Common Stock, no par value, of the Company (the “Common Stock”) in accordance
with the terms of the Notes and the Indentures, at the initial conversion rate
of 90.4936 shares of Common Stock per $1,000 principal amount of

 

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Notes in the case of the 2014 Notes and at the initial conversion rate of
90.4936 shares of Common Stock per $1,000 principal amount of Notes in the case
of the 2016 Notes.
          The holders of the Notes will be entitled to the benefits of a
registration rights agreement, to be dated as of June 27, 2007 (the
“Registration Rights Agreement”), among the Company, the Guarantors party
thereto and the Initial Purchasers, substantially in the form of Exhibit A
attached hereto, pursuant to which the Company and the Guarantors will agree to
file, within 90 days of the Closing Date (as defined below), a shelf
registration statement (the “Registration Statement”) with the Securities and
Exchange Commission (the “Commission”) registering the resale of the Notes and
the shares of Common Stock issuable upon conversion of the Notes under the
Securities Act of 1933, as amended (the “Securities Act”, which term, as used
herein, includes the rules and regulations of the Commission promulgated
thereunder).
          The payment of principal of, premium and Additional Interest and
Special Interest (each, as defined in the respective Indentures), if any, and
interest on the Notes will be fully and unconditionally guaranteed on a senior
unsubordinated and unsecured basis, jointly and severally by the Guarantors as
defined in the Indentures (collectively, the “Guarantors”), pursuant to their
guarantees (the “Guarantees”). Each of the Guarantors as of the date of this
Agreement is listed in Schedule A attached hereto. The Notes and the Guarantees
attached thereto are herein collectively referred to as the “Securities.”
          The Company understands that the Initial Purchasers propose to make an
offering of the Securities on the terms and in the manner set forth herein and
in the Offering Memorandum (as defined below) and agrees that the Initial
Purchasers may resell, subject to the conditions set forth herein, all or a
portion of the Securities to purchasers (the “Subsequent Purchasers”) at any
time after the date of this Agreement. The Securities are to be offered and sold
to or through the Initial Purchasers without being registered with the
Commission under the Securities Act, in reliance upon exemptions therefrom. The
terms of the Securities and the Indentures will require that investors that
acquire Securities expressly agree that Securities may only be resold or
otherwise transferred, after the date hereof, if such Securities are registered
for sale under the Securities Act or if an exemption from the registration
requirements of the Securities Act is available (including the exemptions
afforded by Rule 144A under the Securities Act (“Rule 144A”)).
          The Company has (a) prepared and delivered to each Initial Purchaser
copies of (i) a preliminary offering memorandum dated June 20, 2007 and (ii) a
pricing term sheet dated June 21, 2007, attached hereto as Schedule C, which
includes the pricing terms and other information with respect to the Securities
and other matters not included in the Preliminary Offering Memorandum (as
defined below) (the “Pricing Term Sheet”) and (b) has prepared and will deliver
to each Initial Purchaser, as promptly as practicable prior to the Closing Date,
copies of a final offering memorandum dated June 21, 2007 (the “Final Offering
Memorandum”), each for use by the Initial Purchasers in connection with their
solicitation of offers to purchase the Securities.
          As used herein, “Offering Memorandum” shall mean, with respect to any
date or time referred to in this Agreement, the most recent offering memorandum
(whether the Preliminary Offering Memorandum or the Final Offering Memorandum,
or any amendment or

2

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supplement to either such document), including exhibits thereto and any
documents incorporated therein by reference, which has been prepared and
delivered by the Company to the Initial Purchasers in connection with their
solicitation of offers to purchase the Securities.
          All references in this Agreement to financial statements and schedules
and other information which is “contained,” “included,” or “stated” in the
Offering Memorandum (or other references of like import) shall be deemed to mean
and include all such financial statements and schedules and other information
incorporated by reference in the Offering Memorandum; and all references in this
Agreement to amendments or supplements to the Offering Memorandum shall be
deemed to mean and include the filing of any document under the Securities
Exchange Act of 1934, as amended (the “Exchange Act,” which term, as used
herein, includes the rules and regulations of the Commission promulgated
thereunder), that is incorporated or deemed to be incorporated by reference in
the Offering Memorandum.
          The preliminary offering memorandum dated June 20, 2007, as amended
and supplemented immediately prior to the Applicable Time (as defined below),
including any documents filed under the Exchange Act prior to the Applicable
Time and incorporated by reference therein, is referred to herein as the
“Preliminary Offering Memorandum,” and the Preliminary Offering Memorandum
together with the Pricing Term Sheet are collectively referred to herein as the
“Disclosure Package.”
          “Applicable Time” shall mean 5:30 P.M. (Eastern Time) on June 21, 2007
or such other time as agreed by the Company and Merrill Lynch.
          The Company hereby confirms its agreements with the Initial Purchasers
as follows:
          Section 1. Representations and Warranties. The Company and each of the
Guarantors hereby jointly and severally represent, warrant and covenant to each
Initial Purchaser as of the Applicable Time and as of the Closing Date as
follows:
     (a) No Registration Required. Subject to compliance by the Initial
Purchasers with the representations and warranties set forth in Section 2 hereof
and with the procedures set forth in Section 7 hereof, it is not necessary in
connection with the offer, sale and delivery of the Securities to the Initial
Purchasers and to each Subsequent Purchaser and the conversion of the Securities
into Common Stock, in each case in the manner contemplated by this Agreement,
the Disclosure Package and the Final Offering Memorandum to register the
Securities or the Common Stock under the Securities Act or to qualify the
Indentures under the Trust Indenture Act of 1939, as amended (the “Trust
Indenture Act,” which term, as used herein, includes the rules and regulations
of the Commission promulgated thereunder).
     (b) No Integration of Offerings or General Solicitation. Neither the
Company nor any Guarantor has, directly or indirectly, solicited any offer to
buy or offered to sell, and will not, directly or indirectly, solicit any offer
to buy or offer to sell, in the United States or to any United States citizen or
resident, any security which is or would be integrated with the sale of the
Securities in a manner that would require the Securities to

3

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be registered under the Securities Act. None of the Company, the Guarantors,
their respective affiliates (as such term is defined in Rule 501 under the
Securities Act) (each, an “Affiliate”), or any person acting on their behalf
(other than the Initial Purchasers, as to whom neither the Company nor any
Guarantor makes any representation or warranty) has engaged or will engage, in
connection with the offering of the Securities, in any form of general
solicitation or general advertising within the meaning of Rule 502 under the
Securities Act.
     (c) Eligibility for Resale Under Rule 144A. The Securities are eligible for
resale pursuant to Rule 144A and are not of the same class as securities of the
Company or any subsidiary of the Company listed on a national securities
exchange registered under Section 6 of the Exchange Act or quoted in a U.S.
automated interdealer quotation system.
     (d) Disclosure Package and Final Offering Memorandum. As of the Applicable
Time, neither (x) the Disclosure Package nor (y) any individual Supplemental
Offering Materials (as defined below), when considered together with the
Disclosure Package, included any untrue statement of a material fact or omitted
to state any material fact necessary in order to make the statements therein, in
the light of the circumstances under which they were made, not misleading.
     “Supplemental Offering Materials” means any “written communication” (within
the meaning of the Securities Act) prepared by or on behalf of the Company, or
used or referred to by the Company, that constitutes an offer to sell or a
solicitation of an offer to buy the Securities other than the Offering
Memorandum or amendments or supplements thereto (including the Pricing Term
Sheet), including, without limitation, any road show materials relating to the
Securities that constitutes such a written communication.
     As of its issue date and as of the Closing Date, the Final Offering
Memorandum will not include an untrue statement of a material fact or omit to
state a material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading.
     The representations and warranties in this subsection shall not apply to
statements in or omissions from the Disclosure Package or the Final Offering
Memorandum made in reliance upon and in conformity with written information
furnished to the Company by any Initial Purchaser through Merrill Lynch
expressly for use therein. The Company has not distributed, and will not
distribute, prior to the later of the Closing Date and the completion of the
Initial Purchasers’ distribution of the Securities, any offering material in
connection with the offering and sale of the Securities other than the
Disclosure Package and the Final Offering Memorandum.
     (e) Incorporated Documents. The documents incorporated or deemed to be
incorporated by reference in the Disclosure Package and the Final Offering
Memorandum at the time they were or hereafter are filed with the Commission
complied and will comply in all material respects with the requirements of the
Exchange Act, and, when read together, at the Applicable Time with the other
information in the Disclosure

4

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Package, and at the Closing Date with the Disclosure Package and the Final
Offering Memorandum, did not and will not include an untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading.
     (f) The Purchase Agreement. This Agreement has been duly authorized,
executed and delivered by, and is a valid and binding agreement of, the Company
and each Guarantor, enforceable in accordance with its terms, except as rights
to indemnification hereunder may be limited by applicable law and except as the
enforcement hereof may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws relating to or affecting the rights and
remedies of creditors or by general equitable principles and except as rights to
indemnification under the Registration Rights Agreement may be limited by
applicable law.
     (g) The Registration Rights Agreement. At the Closing Date, the
Registration Rights Agreement will have been duly authorized, executed and
delivered by, and will be a valid and binding agreement of the Company and each
Guarantor, enforceable in accordance with its terms, except as the rights to
indemnification thereunder may be limited by applicable law and except as the
enforcement thereof may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws relating to or affecting the rights and
remedies of creditors or by general equitable principles.
     (h) The DTC Letter of Representations. At the Closing Date, the DTC Letter
of Representations will have been duly authorized, executed and delivered by,
and (assuming the due authorization, execution and delivery thereof by the other
parties thereto) will be a valid and binding agreement of the Company,
enforceable in accordance with its terms except as the enforcement thereof may
be limited by bankruptcy, insolvency, reorganization, moratorium or other
similar laws relating to or affecting the rights and remedies of creditors or by
general equitable principles.
     (i) Authorization of the Notes and the Guarantees. (i) The Notes to be
purchased by the Initial Purchasers from the Company are in the form
contemplated by the Indentures, have been duly authorized for issuance and sale
pursuant to this Agreement and the Indentures and, at the Closing Date, will
have been duly executed by the Company and, when authenticated in the manner
provided for in the applicable Indenture and delivered against payment of the
purchase price therefor, will constitute valid and binding agreements of the
Company, enforceable in accordance with their terms, except as the enforcement
thereof may be limited by bankruptcy, insolvency, reorganization, moratorium or
other similar laws relating to or affecting the rights and remedies of creditors
or by general equitable principles and will be entitled to the benefits of the
Indenture; and (ii) the Guarantees are in the respective forms contemplated by
the applicable Indenture, have been duly authorized for issuance and sale
pursuant to this Agreement and the applicable Indenture and, at the Closing
Date, will have been duly executed by each of the Guarantors and, when the Notes
have been authenticated in the manner provided for in the applicable Indenture
and delivered against payment of the purchase price therefor, will constitute
valid and binding agreements of the Guarantors, enforceable in accordance with
their terms, except as the enforcement thereof may be

5

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limited by bankruptcy, insolvency, reorganization, moratorium or other similar
laws relating to or affecting the rights and remedies of creditors or by general
equitable principles and will be entitled to the benefits of the applicable
Indenture.
     (j) Authorization of the Indentures. Each of the Indentures has been duly
authorized by the Company and by each Guarantor and, at the Closing Date, will
have been duly executed and delivered by the Company and each Guarantor and will
constitute a valid and binding agreement of the Company and each Guarantor,
enforceable against the Company and each Guarantor in accordance with its terms,
except as the enforcement thereof may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws relating to or affecting the
rights and remedies of creditors or by general equitable principles.
     (k) Authorization of Common Stock. Upon issuance and delivery of the
Securities in accordance with this Agreement and the Indentures, the Securities
will be convertible at the option of the holders thereof in accordance with the
terms of the Securities and the Indentures; the shares of Common Stock, if any,
issuable upon conversion of the Securities have been duly authorized and
reserved for issuance upon such conversion by all necessary corporate action and
such shares, when issued upon such conversion, will be validly issued and will
be fully paid and non-assessable; no holder of such shares will be subject to
personal liability by reason of being such a holder; and the issuance of such
shares upon such conversion will not be subject to the preemptive or other
similar rights of any securityholder of the Company.
     (l) Descriptions of Notes and the Indentures. The Notes, the Guarantees,
the Indentures and the Common Stock conform in all material respects to the
respective statements relating thereto contained in the Disclosure Package and
the Final Offering Memorandum.
     (m) No Material Adverse Change. Except as otherwise disclosed in the
Disclosure Package and the Final Offering Memorandum, subsequent to the
respective dates as of which information is given in the Disclosure Package and
the Final Offering Memorandum: (i) there has been no material adverse change, or
any development that could reasonably be expected to result in a material
adverse change, in the condition, financial or otherwise, or in the earnings,
business, operations or prospects, whether or not arising from transactions in
the ordinary course of business, of the Company and its subsidiaries, considered
as one entity (any such change is called a “Material Adverse Change”); (ii) the
Company and its subsidiaries, considered as one entity, have not incurred any
material liability or obligation, indirect, direct or contingent, not in the
ordinary course of business nor entered into any material transaction or
agreement not in the ordinary course of business; and (iii) there has been no
dividend or distribution of any kind declared, paid or made on any class of
capital stock, nor any redemptions or repurchases of capital stock, by the
Company or any of its subsidiaries, except for the regular quarterly dividend
declared by the Company on June 20, 2007 and dividends paid by a subsidiary to
the Company or other subsidiaries, or redemptions or repurchases of capital
stock by subsidiaries of the Company that were wholly owned before and after
such redemptions or repurchases.

6

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     (n) Independent Accountants. PricewaterhouseCoopers LLP (the “Independent
Accountants”), who have expressed their opinion with respect to the financial
statements (which term as used in this Agreement includes the related notes
thereto) and supporting schedules filed with the Commission and included or
incorporated by reference in the Disclosure Package and the Final Offering
Memorandum, are independent registered public accountants with respect to the
Company within the meaning of Regulation S-X under the Exchange Act.
     (o) Preparation of the Financial Statements. (i) The financial statements
of the Company, together with the related schedules and notes, incorporated by
reference in the Disclosure Package and the Final Offering Memorandum present
fairly the consolidated financial position of the Company and its subsidiaries
as of and at the dates indicated and the results of their operations and cash
flows for the periods specified and comply as to form with the applicable
requirements of the Securities Act. Such financial statements have been prepared
in conformity with generally accepted accounting principles as applied in the
United States and have been applied on a consistent basis throughout the periods
involved, except as may be expressly stated in the related notes thereto.
     (p) Incorporation and Good Standing of the Company and its Subsidiaries.
Each of the Company, the Guarantors and the Significant Subsidiaries (as defined
below) has been duly incorporated or organized and is validly existing as a
corporation or other organization in good standing under the laws of the
jurisdiction of its incorporation or organization and has corporate or
organizational power and authority to own, lease and operate its properties and
to conduct its business as described in the Disclosure Package and the Final
Offering Memorandum and to enter into and perform its obligations under each of
this Agreement, the Registration Rights Agreement, the DTC Letter of
Representations, the Securities and the Indentures to which it is a party. Each
subsidiary of the Company that is not a Guarantor or a Significant Subsidiary
has been duly incorporated or organized and is validly existing as a corporation
or organization in good standing under the laws of the jurisdiction of its
incorporation or organization and has corporate or organizational power and
authority to own, lease and operate its properties and to conduct its business
as described in the Disclosure Package and the Final Offering Memorandum, except
for such instances as would not individually or in the aggregate result in a
Material Adverse Change. Each of the Company and each subsidiary is duly
qualified as a foreign corporation to transact business and is in good standing
in each jurisdiction in which such qualification is required, whether by reason
of the ownership or leasing of property or the conduct of business, except for
such jurisdictions where the failure to so qualify or to be in good standing
would not, individually or in the aggregate, result in a Material Adverse
Change. All of the issued and outstanding capital stock of each corporate
subsidiary has been duly authorized and validly issued, is fully paid and
nonassessable and is owned by the Company, directly or through subsidiaries,
free and clear of any security interest, mortgage, pledge, lien, encumbrance or
claim, except as described in Schedule D hereto. The Company does not own or
control, directly or indirectly, any corporation, association or other entity
other than the subsidiaries listed in Schedule D hereto and other than its
funeral and cemetery merchandise and services and perpetual care trust funds. As
used in this Agreement, “Significant Subsidiaries” means

7

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any subsidiary of the Company that would constitute a “significant subsidiary”
within the meaning of Article 1 of Regulation S-X of the Securities Act;
provided, however, that for the purposes of this definition, 5% shall be
substituted for 10% in each place that it appears in such definition. Such
Significant Subsidiaries are listed on Schedule D.
     (q) Capitalization and Other Capital Stock Matters. The authorized, issued
and outstanding capital stock of the Company is as set forth in the financial
statements, including the schedules and notes, included in the Disclosure
Package and the Final Offering Memorandum (other than for subsequent issuances
of capital stock, if any, pursuant to this Agreement, pursuant to employee
benefit plans, stock incentive plans or director compensation plans described in
the Disclosure Package and the Final Offering Memorandum or upon exercise of
outstanding convertible securities, options or warrants described in the
Disclosure Package and the Final Offering Memorandum). All of the outstanding
shares of Common Stock of the Company have been, and will continue to be, duly
authorized and validly issued, are fully paid and nonassessable and have been
issued in compliance with federal and state securities laws. None of the
outstanding shares of Common Stock of the Company were, or will be, issued in
violation of any preemptive rights, rights of first refusal or other similar
rights to subscribe for or purchase securities of the Company. There are no
authorized or outstanding options, warrants, preemptive rights, rights of first
refusal or other rights to purchase, or equity or debt securities convertible
into or exchangeable or exercisable for, any capital stock of the Company or any
of the subsidiaries of the Company, other than those accurately described in the
Disclosure Package and the Final Offering Memorandum and the documents
incorporated by reference therein.
     (r) Stock Exchange Listing. The Common Stock is registered pursuant to
Section 12(b) of the Exchange Act and is listed on the NASDAQ Global Select
Market, and the Company has taken no action designed to, or likely to have the
effect of, terminating the registration of the Common Stock under the Exchange
Act or delisting the Common Stock from the NASDAQ Global Select Market, nor has
the Company received any notification that the Commission or the National
Association of Securities Dealers, Inc. (the “NASD”) is contemplating
terminating such registration or listing.
     (s) Non-Contravention of Existing Instruments; No Further Authorizations or
Approvals Required. Neither the Company nor any of its subsidiaries is in
violation of its charter or by-laws or is in default (or, with the giving of
notice or lapse of time, would be in default) (“Default”) under any indenture,
mortgage, loan or credit agreement, note, contract, franchise, lease, license or
other instrument to which the Company or any of its subsidiaries is a party or
by which it or any of them may be bound or to which any of the property or
assets of the Company or any of its subsidiaries is subject (each, an “Existing
Instrument”), except for such Defaults as would not, individually or in the
aggregate, result in a Material Adverse Change. The Company’s and each
Guarantor’s execution, delivery and performance of this Agreement, the
Registration Rights Agreement, the DTC Letter of Representations, the Indentures
and the documentation relating to the convertible note hedge and warrant
transactions described in the Disclosure Package and the Final Offering
Memorandum (the “Convertible Note Hedge and Warrant Confirmations”) to which it
is a party, and the issuance and delivery of the Securities, or

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the consummation of the transactions contemplated hereby and thereby and by the
Disclosure Package and the Final Offering Memorandum have been duly authorized
by all necessary corporate action and (i) will not result in any violation of
the provisions of the charter or by-laws of the Company or any subsidiary,
(ii) will not conflict with or constitute a breach of, or Default or a Debt
Repayment Triggering Event (as defined below) under, or result in the creation
or imposition of any lien, charge or encumbrance upon any property or assets of
the Company or any of its subsidiaries pursuant to, or require the consent of
any other party to, any Existing Instrument, except for such conflicts,
breaches, Defaults, liens, charges or encumbrances as would not, individually or
in the aggregate, result in a Material Adverse Change and (iii) will not result
in any violation of any law, administrative regulation or administrative or
court decree applicable to the Company or any subsidiary. No consent, approval,
authorization or other order of, or registration or filing with, any court or
other governmental or regulatory authority or agency, is required for the
Company’s or each Guarantor’s execution, delivery and performance of this
Agreement, the Registration Rights Agreement, the DTC Letter of Representations,
the Indentures, the Convertible Note Hedge and Warrant Confirmations or the
issuance and delivery of the Securities, or consummation of the transactions
contemplated hereby and thereby and by the Disclosure Package and the Final
Offering Memorandum, except such as have been obtained or made by the Company or
the Guarantors and are in full force and effect under the Securities Act, the
Trust Indenture Act and applicable state securities or blue sky laws and except
such as may be required by federal and state securities laws or the Trust
Indenture Act with respect to the Company’s or each Guarantor’s obligations
under the Registration Rights Agreement. As used herein, a “Debt Repayment
Triggering Event” means any event or condition which gives, or with the giving
of notice or lapse of time would give, the holder of any note, debenture or
other evidence of indebtedness (or any person acting on such holder’s behalf)
the right to require the repurchase, redemption or repayment of all or a portion
of such indebtedness by the Company or any of its subsidiaries.
     (t) No Material Actions or Proceedings. Except as otherwise disclosed in
the Disclosure Package and the Final Offering Memorandum, there are no legal or
governmental actions, suits or proceedings pending or, to the best of the
Company’s knowledge, (i) threatened against or affecting the Company or any of
its subsidiaries or (ii) which have as the subject thereof any property owned or
leased by, the Company or any of its subsidiaries, where in any such case
described in clause (i) or (ii) (A) there is a reasonable possibility that such
action, suit or proceeding might be determined adversely to the Company or such
subsidiary and (B) any such action, suit or proceeding, if so determined
adversely, would reasonably be expected to result in a Material Adverse Change
or adversely affect the consummation of the transactions contemplated by this
Agreement and by the Disclosure Package and the Final Offering Memorandum in the
“Use of Proceeds” section.
     (u) Intellectual Property Rights. The Company and its subsidiaries own,
possess or license sufficient trademarks, trade names, patent rights,
copyrights, licenses, approvals, trade secrets and other similar rights
(collectively, “Intellectual Property Rights”) reasonably necessary to conduct
their businesses as now conducted, and the expected expiration of any of such
Intellectual Property Rights would not result in a

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Material Adverse Change. Neither the Company nor any of its subsidiaries has
received any notice of infringement or conflict with asserted Intellectual
Property Rights of others, which infringement or conflict, if the subject of an
unfavorable decision, ruling or filing would result in a Material Adverse
Change, and neither the Company nor any of its subsidiaries is in default under
the terms of any license or similar agreement related to any Intellectual
Property Rights necessary to conduct their business as now conducted or
contemplated where such default would result in a Material Adverse Change.
     (v) All Necessary Permits, Etc. The Company and each of its subsidiaries
possess all material valid and current certificates, authorizations or permits
issued by the appropriate municipal, state, federal or foreign regulatory
agencies or bodies necessary to conduct their respective businesses and neither
the Company nor any subsidiary has received any notice of proceedings relating
to the revocation or modification of, or non-compliance with, any such license,
certificate, authorization or permit which, singly or in the aggregate, if the
subject of an unfavorable decision, ruling or finding, could result in a
Material Adverse Change.
     (w) Title to Properties. The Company and each of its subsidiaries has good
and marketable title to all their real and personal properties and assets
reflected as owned in the financial statements referred to in Section 1(o) above
(or elsewhere in the Disclosure Package and the Final Offering Memorandum), in
each case free and clear of any security interests, mortgages, liens,
encumbrances, equities, claims and other defects, except as disclosed in the
financial statements or in the Disclosure Package and the Final Offering
Memorandum and such as would not individually or in the aggregate result in a
Material Adverse Change. The real property, improvements, equipment and personal
property held under lease by the Company or any of its subsidiaries are held
under valid and enforceable leases, except as would not individually or in the
aggregate result in a Material Adverse Change.
     (x) Tax Law Compliance. The Company and its subsidiaries have filed all
necessary federal, state and foreign income and franchise tax returns and have
paid all taxes shown on such returns required to be paid by any of them and, if
due and payable, any related or similar assessment, fine or penalty levied
against any of them, except for immaterial filings, taxes, assessments, fines
and penalties. The Company and each Guarantor has made adequate charges,
accruals and reserves in the applicable financial statements referred to in
Section 1 above in respect of all federal, state and foreign income and
franchise taxes for all periods as to which the tax liability of the Company or
any of its subsidiaries has not been finally determined.
     (y) Company Not an “Investment Company”. The Company is not, and after the
issuance of the Securities and application of the net proceeds therefrom as
described in the Disclosure Package and the Final Offering Memorandum will not
be, an “investment company” within the meaning of Investment Company Act of
1940, as amended (the “Investment Company Act”), and will conduct its business
in a manner so that it will not become subject to the Investment Company Act.

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     (z) Insurance. Each of the Company and its subsidiaries are, and at the
Closing Date will be, insured by recognized, financially sound institutions with
policies in such amounts and with such deductibles and covering such risks as
are generally deemed adequate and customary for their businesses including, but
not limited to, policies covering real and personal property owned or leased by
the Company and its subsidiaries against theft, damage, destruction, acts of
vandalism and earthquakes, except as would not result in a Material Adverse
Change. The Company has no reason to believe that it or any subsidiary will not
be able (i) to renew its existing material insurance coverage as and when such
policies expire or (ii) to obtain comparable coverage from similar institutions
as may be necessary or appropriate to conduct its business as now conducted and
at a cost that would not result in a Material Adverse Change. Neither of the
Company nor any subsidiary has been denied any material insurance coverage which
it has sought or for which it has applied.
     (aa) No Price Stabilization or Manipulation. Neither the Company nor any
Guarantor has taken or will take, directly or indirectly, any action designed to
or that might be reasonably expected to cause or result in stabilization or
manipulation of the price of any security of the Company to facilitate the sale
or resale of the Securities.
     (bb) Solvency. The Company and each Guarantor is, and after giving effect
to the transactions contemplated hereby or in the Disclosure Package and the
Final Offering Memorandum will be, Solvent. As used herein, the term “Solvent”
means, with respect to the Company and each Guarantor on a particular date, that
on such date: (1) the fair value of its assets (both at fair market value and at
present fair saleable value on an orderly basis) is in excess of the total
amount of its probable liabilities, including, without duplication, contingent
obligations of the Company or such Guarantor, as appropriate; and (2) it is then
able and expects to be able to pay its debts and liabilities, including its
contingent liabilities, as they mature; and (3) it has capital not unreasonably
small to carry on its business as conducted and as proposed to be conducted.
     (cc) No Unlawful Contributions or Other Payments. Neither the Company nor
any of its subsidiaries nor, to the best of the Company’s or any Guarantor’s
knowledge, any employee, director or agent of the Company or any subsidiary, has
made any contribution or other payment to any official of, or candidate for, any
federal, state or foreign office in violation of any material law or of the
character necessary to be disclosed in the Disclosure Package and the Final
Offering Memorandum in order to make the statements therein not misleading.
     (dd) Accounting Controls and Disclosure Controls. The Company and each of
its subsidiaries maintain a system of internal accounting controls sufficient to
provide reasonable assurances that (i) transactions are executed in accordance
with management’s general or specific authorization; (ii) transactions are
recorded as necessary to permit preparation of financial statements in
conformity with generally accepted accounting principles as applied in the
United States and to maintain accountability for assets; (iii) access to assets
is permitted only in accordance with management’s general or specific
authorization; and (iv) the recorded accountability for assets is compared with
existing assets at reasonable intervals and appropriate action is taken with
respect to any

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differences. Except as described in the Disclosure Package and Final Offering
Memorandum, since the end of the Company’s most recent audited fiscal year,
there has been (A) no material weakness in the Company’s internal control over
financial reporting (whether or not remediated) and (B) no change in the
Company’s internal control over financial reporting that has materially
affected, or is reasonably likely to materially affect, the Company’s internal
control over financial reporting. The Company and its consolidated subsidiaries
employ disclosure controls and procedures that are designed to ensure that
information required to be disclosed by the Company in the reports that it files
or submits under the Exchange Act is recorded, processed, summarized and
reported, within the time periods specified in the Commission’s rules and forms,
and is accumulated and communicated to the Company’s management, including its
principal executive officer or officers and principal financial officer or
officers, as appropriate, to allow timely decisions regarding disclosure.
     (ee) Compliance with the Sarbanes-Oxley Act. There is and has been no
failure on the part of the Company or any of the Company’s directors or
officers, in their capacities as such, to comply in all material respects with
any provision of the Sarbanes-Oxley Act of 2002 and the rules and regulations
promulgated in connection therewith, including Section 402 related to loans and
Sections 302 and 906 related to certifications.
     (ff) Compliance with Environmental Laws. Except as would not, individually
or in the aggregate, result in a Material Adverse Change (i) neither the Company
nor any of its subsidiaries is in violation of any applicable federal, state,
local or foreign law or regulation relating to pollution or protection of human
health or the environment (including, without limitation, ambient air, surface
water, groundwater, land surface or subsurface strata) or wildlife, including
without limitation, laws and regulations relating to emissions, discharges,
releases or threatened releases of chemicals, pollutants, contaminants, wastes,
toxic substances, hazardous substances, petroleum and petroleum products
(collectively, “Materials of Environmental Concern”), or otherwise relating to
the manufacture, processing, distribution, use, treatment, storage, disposal,
transport or handling of Materials of Environmental Concern (collectively,
“Environmental Laws”), which violation includes, but is not limited to,
noncompliance with any permits or other governmental authorizations required for
the operation of the business of the Company or its subsidiaries under
applicable Environmental Laws, or noncompliance with the terms and conditions
thereof, nor has the Company or any of its subsidiaries received any written
communication, whether from a governmental authority responsible for enforcing
applicable Environmental Laws, citizens’ group, employee or otherwise, that
alleges that the Company or any of its subsidiaries is in violation of any
Environmental Law; (ii) there is no claim, action or cause of action filed with
a court or governmental authority, no investigation with respect to which the
Company or any Guarantor has received written notice, and no written notice by
any person or entity alleging potential liability for investigatory costs,
cleanup costs, governmental responses costs, natural resources damages, property
damages, personal injuries, attorneys’ fees or penalties arising out of, based
on or resulting from the presence, or release into the environment, of any
Material of Environmental Concern at any location owned, leased or operated by
the Company or any of its subsidiaries, now or in the past (collectively,
“Environmental Claims”), pending or, to the best of the Company’s or any
Guarantor’s knowledge, threatened

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against the Company or any of its subsidiaries or any person or entity whose
liability for any Environmental Claim the Company or any of its subsidiaries has
retained or assumed either contractually or by operation of law; and (iii) to
the best of the Company’s or any Guarantor’s knowledge, there are no past or
present actions, activities, circumstances, conditions, events or incidents,
including, without limitation, the release, emission, discharge, presence or
disposal of any Material of Environmental Concern, that could reasonably be
expected to result in a violation of any applicable Environmental Law or form
the basis of a potential Environmental Claim against the Company or any of its
subsidiaries or against any person or entity whose liability for any
Environmental Claim the Company or any of its subsidiaries has retained or
assumed either contractually or by operation of law.
     (gg) ERISA Compliance. The Company and its subsidiaries and any “employee
benefit plan” (as defined under the Employee Retirement Income Security Act of
1974, as amended, and the regulations and published interpretations thereunder
(collectively, “ERISA”)) established or maintained by the Company, its
subsidiaries or their “ERISA Affiliates” (as defined below) are in compliance in
all material respects with ERISA, except as would not individually or in the
aggregate result in a Material Adverse Change. “ERISA Affiliate” means, with
respect to the Company or a subsidiary, any member of any group of organizations
described in Sections 414 of the Internal Revenue Code of 1986, as amended, and
the regulations and published interpretations thereunder (the “Code”) of which
the Company or such subsidiary is a member. No “reportable event” (as defined
under Section 4043 of ERISA) has occurred or is reasonably expected to occur
with respect to any “employee benefit plan” established or maintained by the
Company, its subsidiaries or any of their ERISA Affiliates. No “employee benefit
plan” established or maintained by the Company, its subsidiaries or any of their
ERISA Affiliates, if such “employee benefit plan” were terminated, would have
any “amount of unfunded benefit liabilities” (as defined under
Section 4001(a)(18) of ERISA). Neither the Company, its subsidiaries nor any of
their ERISA Affiliates has incurred or reasonably expects to incur any liability
under (i) Title I or Title IV of ERISA or (ii) Sections 412, 4971, 4975 or 4980B
of the Code. Each “employee benefit plan” established or maintained by the
Company, its subsidiaries or any of their ERISA Affiliates that is intended to
be qualified under Section 401(a) of the Code is so qualified and nothing has
occurred, whether by action or failure to act, which would cause the loss of
such qualification.
     (hh) Taxes; Fees. There are no stamp or other issuance or transfer taxes or
duties or other similar fees or charges required to be paid in connection with
the execution and delivery of this Agreement or the issuance or sale by the
Company of the Securities.
     (ii) No Labor Disputes. No material labor dispute with the employees of the
Company or any of its subsidiaries exists or, to the knowledge of the Company,
is imminent; and the Company is not aware of any existing, threatened or
imminent labor disturbance by the employees of any of its principal customers,
suppliers, manufacturers or contractors that would result in a Material Adverse
Change.

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     (jj) No Default in Indebtedness. No event of default exists under any
contract, indenture, mortgage, loan agreement, note, lease or other agreement or
instrument constituting Indebtedness (as defined in the Indentures) of the
Company.
     (kk) Excluded Domestic Subsidiaries. Each of the domestic subsidiaries of
the Company in existence on the date hereof that is not a Guarantor in respect
of the Securities, is listed on Schedule E, and individually and in the
aggregate constituted less than 5% of the Company’s consolidated assets and less
than 5% of the Company’s consolidated revenue in fiscal 2006.
          Any certificate signed by an officer of the Company or any Guarantor
and delivered to the Initial Purchasers or to counsel for the Initial Purchasers
shall be deemed to be a representation and warranty by the Company or such
Guarantor to each Initial Purchaser as to the matters set forth therein.
          Section 2. Purchase, Sale and Delivery of the Securities.
     (a) The Securities. The Company agrees to issue and sell to the several
Initial Purchasers, severally and not jointly, all of the Securities upon the
terms herein set forth. On the basis of the representations, warranties and
agreements herein contained, and upon the terms but subject to the conditions
herein set forth, the Initial Purchasers agree, severally and not jointly, to
purchase from the Company the aggregate principal amount of Securities set forth
opposite their names on Schedule B, at a purchase price of 98% of the principal
amount of the 2014 Notes and 98% of the principal amount of the 2016 Notes.
     (b) Delivery of Securities; Payment. Payment of the purchase price for, and
delivery of certificates for, the Securities shall be made at the offices of
Sidley Austin LLP, 787 Seventh Avenue, New York, New York 10019, or at such
other place as shall be agreed upon by Merrill Lynch and the Company, at 9:00
A.M. (Eastern time) on the third (fourth, if the pricing occurs after 4:30 P.M.
(Eastern time) on any given day) business day after the date hereof (unless
postponed in accordance with the provisions of Section 16), or such other time
not later than ten business days after such date as shall be agreed upon by
Merrill Lynch and the Company (such time and date of payment and delivery being
herein called “Closing Date”).
     Payment shall be made to the Company by wire transfer of immediately
available funds to a bank account designated by the Company, against delivery to
Merrill Lynch for the respective accounts of the Initial Purchasers of
certificates for the Securities to be purchased by them. It is understood that
each Initial Purchaser has authorized Merrill Lynch, for its account, to accept
delivery of, receipt for, and make payment of the purchase price for, the
Securities which it has agreed to purchase. Merrill Lynch, individually and not
as representative of the Initial Purchasers, may (but shall not be obligated to)
make payment of the purchase price for the Securities to be purchased by any
Initial Purchaser whose funds have not been received by the Closing Date, but
such payment shall not relieve such Initial Purchaser from its obligations
hereunder.

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     (c) Denominations; Registration. The certificates for the Securities shall
be in such denominations permitted under the Indentures and registered in the
name of Cede & Co., as nominee of the Depository, pursuant to the DTC Letter of
Representations, and shall be made available for inspection on the business day
preceding the Closing Date at a location in New York City, as the Initial
Purchasers may designate.
     (d) Initial Purchasers as Qualified Institutional Buyers. Each Initial
Purchaser severally and not jointly represents and warrants to, and agrees with,
the Company that it is a “qualified institutional buyer” within the meaning of
Rule 144A (a “Qualified Institutional Buyer”) and an “accredited investor”
within the meaning of Rule 501 under the Securities Act (an “Accredited
Investor”).
          Section 3. Additional Covenants. The Company and each of the
Guarantors further jointly and severally covenant and agree with each Initial
Purchaser as follows:
     (a) Notice and Effect of Material Events. The Company and the Guarantors
will immediately notify the Initial Purchasers, and confirm such notice in
writing, of (x) any filing made by the Company and the Guarantors of information
relating to the offering of the Securities with any securities exchange or any
other regulatory body in the United States or any other jurisdiction, and
(y) prior to the completion of the placement of the offered Securities by the
Initial Purchasers as evidenced by a notice in writing from the Initial
Purchasers to the Company, any material changes in or affecting the condition,
financial or otherwise, or the earnings, business affairs or business prospects
of the Company and its subsidiaries considered as one enterprise which (i) make
the statements in the Disclosure Package or the Final Offering Memorandum false
or misleading or (ii) are not disclosed in the Disclosure Package and the Final
Offering Memorandum. In such event or if during such time any event shall occur
as a result of which it is necessary, in the reasonable opinion of any of the
Company, its counsel, the Initial Purchasers or counsel for the Initial
Purchasers, to amend or supplement the Final Offering Memorandum in order that
the Final Offering Memorandum not include any untrue statement of a material
fact or omit to state a material fact necessary in order to make the statements
therein not misleading in the light of the circumstances then existing, the
Company and the Guarantors will forthwith amend or supplement the Final Offering
Memorandum by preparing and furnishing to the Initial Purchasers an amendment or
amendments of, or a supplement or supplements to, the Final Offering Memorandum
(in form and substance satisfactory in the reasonable opinion of counsel for the
Initial Purchasers) so that, as so amended or supplemented, the Final Offering
Memorandum will not include an untrue statement of a material fact or omit to
state a material fact necessary in order to make the statements therein, in the
light of the circumstances existing at the time it is delivered to a Subsequent
Purchaser, not misleading.
     (b) Amendments and Supplements to the Offering Memorandum. The Company and
the Guarantors will advise the Initial Purchasers promptly of any proposal to
amend or supplement the Final Offering Memorandum (including any filings with
the Commission made pursuant to the Exchange Act) and will not effect such
amendment or supplement without the consent of the Initial Purchasers, not to be
unreasonably withheld. Neither the consent of the Initial Purchasers, nor the
Initial Purchasers’

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delivery of any such amendment or supplement, shall constitute a waiver of any
of the conditions set forth in Section 5 hereof. If at any time prior to the
completion of the placement of the Securities by the Initial Purchasers, the
Company or any Guarantor has issued or shall have issued any written
communication, which would be deemed a “free writing prospectus” as defined in
Rule 405 of the Securities Act if the placement of the Securities contemplated
by this Agreement were conducted as a public offering made pursuant to a
registration statement filed with the Commission under the Securities Act (a
“Supplemental Offering Document”), and there occurred or occurs an event or
development as a result of which such Supplemental Offering Document conflicted
or would conflict with the information contained in the Disclosure Package or
the Final Offering Memorandum or included or would include an untrue statement
of a material fact or omitted or would omit to state a material fact necessary
in order to make the statements therein, in the light of the circumstances
prevailing at that subsequent time, not misleading, the Company and the
Guarantors will promptly notify the Initial Purchasers and will promptly amend
or supplement, at its own expense, such Supplemental Offering Document to
eliminate or correct such conflict, untrue statement or omission.
     (c) Copies of the Disclosure Package and the Final Offering Memorandum. The
Company agrees to furnish the Initial Purchasers, without charge, as many copies
of the Disclosure Package and the Final Offering Memorandum and any amendments
and supplements thereto as they shall have reasonably requested.
     (d) Blue Sky Compliance. The Company shall cooperate with the Initial
Purchasers and counsel for the Initial Purchasers to qualify or register the
Securities for sale under (or obtain exemptions from the application of) the
Blue Sky or state securities laws of those jurisdictions designated by the
Initial Purchasers, shall comply with such laws and shall continue such
qualifications, registrations and exemptions in effect so long as required for
the sale of the Securities to the Subsequent Purchasers. The Company shall not
be required to qualify as a foreign corporation or to take any action that would
subject it to general service of process in any such jurisdiction where it is
not presently qualified or where it would be subject to taxation as a foreign
corporation. The Company will advise the Initial Purchasers promptly of the
suspension of the qualification or registration of (or any such exemption
relating to) the Securities for offering, sale or trading in any jurisdiction or
any initiation or threat of any proceeding for any such purpose, and in the
event of the issuance of any order suspending such qualification, registration
or exemption, the Company shall use its reasonable best efforts to obtain the
withdrawal thereof at the earliest possible moment.
     (e) Use of Proceeds. The Company shall apply the net proceeds from the sale
of the Securities sold by it in the manner described under the caption “Use of
Proceeds” in the Disclosure Package and the Final Offering Memorandum.
     (f) Depositary. The Company will cooperate with the Initial Purchasers and
use its reasonable best efforts to permit the Securities to be eligible for
clearance and settlement through the facilities of the Depositary.

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     (g) Additional Issuer Information. Prior to the completion of the placement
of the Securities by the Initial Purchasers with the Subsequent Purchasers, the
Company shall file, on a timely basis, with the Commission and the NASDAQ Global
Select Market all reports and documents required to be filed under Section 13 or
15 of the Exchange Act. Additionally, at any time when the Company is not
subject to Section 13 or 15 of the Exchange Act, for the benefit of holders and
beneficial owners from time to time of Securities, the Company shall furnish, at
its expense, upon request, to holders and beneficial owners of Securities and
prospective purchasers of Securities information (“Additional Issuer
Information”) satisfying the requirements of subsection (d)(4) of Rule 144A.
     (h) Restriction on Sale of Securities. Except as otherwise contemplated by
the Disclosure Package and the Final Offering Memorandum, during a period of
90 days from the date of the Final Offering Memorandum (the “Lock-up Period”),
the Company will not, without the prior written consent of Merrill Lynch,
(i) offer, pledge, sell, announce the intention to sell, contract to sell, sell
any option or contract to purchase, purchase any option or contract to sell,
grant any option, right or warrant for the sale of, lend or otherwise transfer
or dispose of any shares of Common Stock or any securities convertible into or
exercisable or exchangeable for or repayable with Common Stock, or file any
registration statement under the Securities Act with respect to any of the
foregoing or (ii) enter into any swap or other agreement or any transaction that
transfers, in whole or in part, directly or indirectly, the economic
consequences of ownership of the Common Stock, or any securities convertible
into or exercisable or exchangeable for or repayable with Common Stock, whether
any such swap or transaction described in clause (i) above or this clause
(ii) is to be settled by delivery of Common Stock or such other securities, in
cash or otherwise. The foregoing sentence shall not apply to (A) shares of
Common Stock to be issued upon conversion of the Securities, (B) the Convertible
Note Hedge and Warrant Confirmations and any transactions in the Company’s
securities contemplated thereby, (C) the Company’s issuance of stock options,
restricted stock or other stock-based compensation to the Company’s directors
and employees pursuant to any existing employee benefit plans, stock incentive
plans or director compensation plans of the Company, (D) the Company’s issuance
of shares of Common Stock to directors and employees of the Company upon the
vesting of restricted stock or the exercise of options outstanding on the date
hereof under existing employee benefit plans, stock incentive plans or director
compensation plans of the Company, (E) securities issued or to be issued by the
Company in connection with a merger, acquisition or other business combination,
provided that the recipients of such securities shall enter into lock-up
agreements for the balance of the Lock-up Period, (F) the filing of a
registration statement on Form S-8 to register shares of Common Stock to be
issued under any existing employee benefit plans, stock incentive plans or
director compensation plans of the Company or (G) the filing of a registration
statement on Form S-4 to register shares of Common Stock.
     (i) Future Reports to the Initial Purchasers. If such documents are not
publicly available on the Commission’s web site described under the caption
“Incorporation of Certain Documents by Reference” in the Disclosure Package and
the Final Offering Memorandum, for so long as any Securities remain outstanding,
the

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Company will furnish to Merrill Lynch (i) as soon as practicable after the end
of each fiscal year, copies of the Annual Report of the Company containing the
balance sheet of the Company as of the close of such fiscal year and statements
of income, stockholders’ equity and cash flows for the year then ended and the
opinion thereon of the Company’s independent public or certified public
accountants; (ii) as soon as practicable after the filing thereof, copies of
each proxy statement, Annual Report on Form 10-K, Quarterly Report on Form 10-Q,
Current Report on Form 8-K or other report filed by the Company with the
Commission, the NASD or any securities exchange; and (iii) as soon as available,
copies of any report or communication of the Company mailed generally to holders
of its capital stock or debt securities (including the holders of the
Securities).
     (j) No Integration. The Company agrees that it will not, and will cause its
Affiliates not to, make any offer or sale of securities of any class if, as a
result of the doctrine of “integration” referred to in Rule 502 under the
Securities Act, such offer or sale would render invalid (for the purpose of
(i) the sale of the Securities by the Company to the Initial Purchasers,
(ii) the resale of the Securities by the Initial Purchasers to Subsequent
Purchasers or (iii) the resale of the Securities by such Subsequent Purchasers
to others) the exemption from the registration requirements of the Securities
Act provided by Section 4(2) thereof or by Rule 144A or otherwise.
     (k) Legended Securities. Each certificate for a Note will bear the legend
contained in “Transfer Restrictions” in the Disclosure Package and the Final
Offering Memorandum for the time period and upon the other terms stated in the
Disclosure Package and the Final Offering Memorandum.
     (l) PORTAL. The Company will use its reasonable best efforts to cause such
Securities when issued to be eligible for the National Association of Securities
Dealers, Inc. PORTAL™ market (the “PORTAL market”).
     (m) Rating of Securities. The Company shall take all reasonable action
necessary to enable either or both of Standard & Poor’s Ratings Services, a
division of McGraw Hill, Inc. (“S&P”), and Moody’s Investor Services, Inc.
(“Moody’s”) to provide their respective credit ratings to the Securities at or
prior to the time of their initial issuance.
     (n) Reservation of Shares of Common Stock. The Company shall reserve and
keep available at all times, free of preemptive rights, shares of Common Stock
for the purpose of enabling the Company to satisfy any obligations to issue
shares of Common Stock upon conversion of the Securities.
     (o) No Other Offering Documents. The Company and each Guarantor represents
and agrees that, unless it obtains the prior consent of Merrill Lynch, and each
Initial Purchaser represents and agrees that, unless it obtains the prior
consent of the Company and the Guarantors, it has not made and will not make any
offer relating to the Securities by means of any Supplemental Offering
Materials.

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          Merrill Lynch, on behalf of the several Initial Purchasers, may, in
its sole discretion, waive in writing the performance by the Company of any one
or more of the foregoing covenants or extend the time for their performance.
          Section 4. Payment of Expenses. The Company and each of the Guarantors
jointly and severally agree to pay all costs, fees and expenses incurred in
connection with the performance of its obligations hereunder and in connection
with the transactions contemplated hereby, including without limitation (i) all
expenses incident to the issuance and delivery of the Securities (including all
printing and engraving costs and “road show” costs), (ii) all necessary issue,
transfer and other stamp taxes in connection with the issuance and sale of the
Securities to the Initial Purchasers, (iii) all fees and expenses of the
Company’s and the Guarantors’ counsel, independent public or certified public
accountants and other advisors, (iv) all costs and expenses incurred in
connection with the preparation, printing, filing, shipping and distribution of
the Disclosure Package and the Final Offering Memorandum (including any
financial statements and exhibits), and all amendments and supplements thereto,
this Agreement, the Registration Rights Agreement, the Indentures, the DTC
Letter of Representations, and the Notes and the Guarantees, (v) all filing
fees, attorneys’ fees and expenses incurred by the Company, the Guarantors or
the Initial Purchasers in connection with qualifying or registering (or
obtaining exemptions from the qualification or registration of) all or any part
of the Securities for offer and sale under the Blue Sky laws and, if requested
by the Initial Purchasers, preparing and printing a “Blue Sky Survey” or
memorandum, and any supplements thereto, advising the Initial Purchasers of such
qualifications, registrations and exemptions, (vi) the fees and expenses of the
Trustee, including the fees and disbursements of counsel for the Trustee in
connection with the Indentures and the Securities, (vii) any fees payable in
connection with the rating of the Securities with the ratings agencies and the
listing of the Securities with the PORTAL market, (viii) any filing fees
incident to, and any reasonable fees and disbursements of counsel to the Initial
Purchasers in connection with the review by the NASD, if any, of the terms of
the sale of the Securities, (ix) all fees and expenses (including reasonable
fees and expenses of counsel) of the Company and the Guarantors in connection
with approval of the Securities by the Depositary for “book-entry” transfer, and
(x) the performance by the Company and the Guarantors of their respective other
obligations under this Agreement. Except as provided in this Section 4,
Section 6, Section 8 and Section 9 hereof, the Initial Purchasers shall pay
their own expenses, including the fees and disbursements of their counsel.
          Section 5. Conditions of the Obligations of the Initial Purchasers.
The obligations of the several Initial Purchasers to purchase and pay for the
Securities as provided herein shall be subject to the accuracy of the
representations and warranties on the part of the Company and the Guarantors set
forth in Section 1 hereof as of the date hereof and as of the Closing Date as
though then made and to the timely performance by the Company or any Guarantor
of its covenants and other obligations hereunder, and to each of the following
additional conditions:
     (a) Accountants’ Comfort Letter. On the date hereof the Initial Purchasers
shall have received from the Independent Accountants a letter dated the date
hereof addressed to the Initial Purchasers, in form and substance satisfactory
to the Initial Purchasers, containing statements and information of the type
ordinarily included in accountant’s “comfort letters” to the Initial Purchasers
with respect to the audited and

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unaudited financial statements and certain financial information contained in
the Disclosure Package and the Final Offering Memorandum.
     (b) No Material Adverse Change or Ratings Agency Change. For the period
from and after the date of this Agreement to the Closing Date:
     (i) in the reasonable judgment of the Initial Purchasers there shall not
have occurred any Material Adverse Change; and
     (ii) there shall not have occurred any downgrading, nor shall any notice
have been given of any intended or potential downgrading or of any review for a
possible change that does not indicate the direction of the possible change, in
the rating accorded any securities of the Company or any of its subsidiaries by
any “nationally recognized statistical rating organization” as such term is
defined for purposes of Rule 436 under the Securities Act.
     (c) Opinion of Counsel for the Company and the Guarantors. On the Closing
Date, the Initial Purchasers shall have received the opinion of Jones, Walker,
Waechter, Poitevent, Carrère and Denègre L.L.P., counsel for the Company and the
Guarantors, dated as of such Closing Date, the form of which is attached as
Exhibit B.
     (d) Opinion of Local Counsel for the Guarantors. On the Closing Date, the
Initial Purchasers shall have received an opinion of those local counsel for the
Guarantors listed on Schedule F, dated as of such Closing Date, the form of
which is attached as Exhibit C.
     (e) Opinion of Special Counsel for the Company and the Guarantors. On the
Closing Date, the Initial Purchasers shall have received the opinion of Davis
Polk & Wardwell, counsel for the Company and the Guarantors, dated as of such
Closing Date, the form of which is attached as Exhibit D.
     (f) Opinion of Counsel for the Initial Purchasers. On the Closing Date, the
Initial Purchasers shall have received the favorable opinion of Sidley Austin
LLP, counsel for the Initial Purchasers, dated as of such Closing Date, with
respect to such matters as may be requested by the Initial Purchasers.
     (g) Officers’ Certificate. On the Closing Date the Initial Purchasers shall
have received a written certificate executed by the Chairman of the Board, Chief
Executive Officer, Chief Operating Officer, President or Vice President of the
Company and each of the Guarantors and the Chief Financial Officer, Chief
Accounting Officer, Treasurer, or Assistant Treasurer, Secretary or Assistant
Secretary of the Company and each of the Guarantors, dated as of the Closing
Date, to the effect set forth in subsection (b)(ii) of this Section 5, and
further to the effect that:
     (i) for the period from and after the date of this Agreement and prior to
the Closing Date there has not occurred any Material Adverse Change;

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     (ii) the representations, warranties and covenants of the Company and such
Guarantors set forth in Section 1 of this Agreement are true and correct with
the same force and effect as though expressly made on and as of the Closing
Date; and
     (iii) the Company and the Guarantors have complied with all the agreements
and satisfied all the conditions on its part to be performed or satisfied at or
prior to the Closing Date.
     (h) Bring-down Comfort Letter. On the Closing Date, the Initial Purchasers
shall have received from the Independent Accountants, a letter dated such date,
in form and substance reasonably satisfactory to the Initial Purchasers, to the
effect that they reaffirm the statements made in the letter furnished by them
pursuant to subsection (a) of this Section 5, except that the specified date
referred to therein for the carrying out of procedures shall be no more than
three business days prior to the Closing Date.
     (i) PORTAL Listing. At the Closing Date, the Securities shall have been
designated for trading on the PORTAL market.
     (j) Registration Rights Agreement. The Company and the Guarantors shall
have entered into the Registration Rights Agreement and the Initial Purchasers
shall have received executed counterparts thereof.
     (k) Lock-up Agreements. On or prior to the date of this Agreement, Merrill
Lynch shall received an agreement substantially in the form of Exhibit E hereto
signed by the persons listed in Schedule G hereto.
     (l) Additional Documents. On or before the Closing Date, the Initial
Purchasers and counsel for the Initial Purchasers shall have received such
information, documents and opinions as they may reasonably require for the
purposes of enabling them to pass upon the issuance and sale of the Securities
as contemplated herein, or in order to evidence the accuracy of any of the
representations and warranties, or the satisfaction of any of the conditions or
agreements, herein contained, including but not limited to, a certificate from
the Chief Financial Officer computing and certifying the estimated future
backlog of the Company.
          If any condition specified in this Section 5 is not satisfied when and
as required to be satisfied, this Agreement may be terminated by the Initial
Purchasers by notice to the Company at any time on or prior to the Closing Date,
which termination shall be without liability on the part of any party to any
other party, except that Section 4, Section 6, Section 8 and Section 9 shall at
all times be effective and shall survive such termination.
          Section 6. Reimbursement of Initial Purchasers’ Expenses. If this
Agreement is terminated by the Initial Purchasers pursuant to Section 5, or if
the sale to the Initial Purchasers of the Securities on the Closing Date is not
consummated because of any refusal, inability or failure on the part of the
Company or any Guarantor to perform any agreement herein or to comply with any
provision hereof, the Company and the Guarantors jointly and severally agree to
reimburse the Initial Purchasers (or such Initial Purchasers as have terminated
this

21

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Agreement with respect to themselves), severally, upon demand for all reasonable
out-of-pocket expenses that shall have been incurred by the Initial Purchasers
in connection with the proposed purchase and the offering and sale of the
Securities, including but not limited to reasonable fees and disbursements of
counsel, printing expenses, travel expenses, postage, facsimile and telephone
charges.
          Section 7. Offer, Sale and Resale Procedures. The Initial Purchasers,
on the one hand, and the Company and each of the Guarantors, on the other hand,
hereby establish and agree to observe the following procedures in connection
with the offer and sale of the Securities:
     (a) Offers and Sales Only to Qualified Institutional Buyers. Offers and
sales of the Securities will be made only by the Initial Purchasers or
Affiliates thereof qualified to do so in the jurisdictions in which such offers
or sales are made and only in the manner contemplated by the Offering
Memorandum. Each such offer or sale shall only be made to persons whom the
offeror or seller reasonably believes to be qualified institutional buyers (as
defined in Rule 144A under the Securities Act), upon the terms and conditions
contemplated by the Disclosure Package and the Final Offering Memorandum.
     (b) No General Solicitation. The Securities will be offered by approaching
prospective Subsequent Purchasers on an individual basis. No general
solicitation or general advertising (within the meaning of Rule 502 under the
Securities Act) will be used in the United States in connection with the
offering of the Securities.
     (c) Restrictions on Transfer. The transfer restrictions and other
provisions set forth in the Offering Memorandum under the caption “Transfer
Restrictions,” including the legend required thereby shall apply to the
Securities, except as otherwise agreed by the Company and Merrill Lynch.
Following the sale of the Securities by the Initial Purchasers to Subsequent
Purchasers pursuant to the terms hereof, the Initial Purchasers shall not be
liable or responsible to the Company or any Guarantor for any losses, damages or
liabilities suffered or incurred by the Company or such Guarantor, including any
losses, damages or liabilities under the Securities Act, arising from or
relating to any resale or transfer of any Security by such Subsequent Purchaser
or subsequent transferee.
          Section 8. Indemnification.
     (a) Indemnification of the Initial Purchasers. The Company and each of the
Guarantors jointly and severally agree to indemnify and hold harmless each
Initial Purchaser, its directors, officers and employees and each person, if
any, who controls any Initial Purchaser within the meaning of the Securities Act
and the Exchange Act against any loss, claim, damage, liability or expense, as
incurred, to which such Initial Purchaser, director, officer, employee or
controlling person may become subject, under the Securities Act, the Exchange
Act or other federal or state statutory law or regulation, or at common law or
otherwise (including in settlement of any litigation, if such settlement is
effected with the written consent of the Company and/or any Guarantor sought to
be bound), insofar as such loss, claim, damage, liability or expense (or actions
in respect thereof as contemplated below) arises out of or is based (i) upon any
untrue statement or alleged untrue statement of a material fact contained in the
Disclosure Package or the

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Final Offering Memorandum (or any amendment or supplement thereto), or the
omission or alleged omission therefrom of a material fact necessary in order to
make the statements therein, in the light of the circumstances under which they
were made, not misleading; or (ii) in whole or in part upon any inaccuracy in
the representations and warranties of the Company or any Guarantor contained
herein; or (iii) in whole or in part upon any failure of the Company or any
Guarantor to perform its obligations hereunder or under law; or (iv) any act or
failure to act or any alleged act or failure to act by any Initial Purchaser in
connection with, or relating in any manner to, the offering contemplated hereby,
and which is included as part of or referred to in any loss, claim, damage,
liability or action arising out of or based upon any matter covered by clause
(i) above, provided that the Company and the Guarantors shall not be liable
under this clause (iv) to the extent that a court of competent jurisdiction
shall have determined by a final judgment that such loss, claim, damage,
liability or action resulted directly from any such acts or failures to act
undertaken or omitted to be taken by such Initial Purchaser through its gross
negligence or willful misconduct, and to reimburse each Initial Purchaser and
each such director, officer, employee or controlling person for any and all
expenses (including the fees and disbursements of counsel chosen by Merrill
Lynch) as such expenses are reasonably incurred by such Initial Purchaser or
such director, officer, employee or controlling person in connection with
investigating, defending, settling, compromising or paying any such loss, claim,
damage, liability, expense or action; provided, however, that the foregoing
indemnity agreement shall not apply to any loss, claim, damage, liability or
expense to the extent, but only to the extent, arising out of or based upon any
untrue statement or alleged untrue statement or omission or alleged omission
made in reliance upon and in conformity with written information furnished to
the Company by the Initial Purchasers expressly for use in the Disclosure
Package or the Final Offering Memorandum (or any amendment or supplement
thereto). The indemnity agreement set forth in this Section 8 shall be in
addition to any liabilities that the Company or the Guarantors may otherwise
have.
     (b) Indemnification of the Company, the Guarantors and each of their
Directors and Officers. Each Initial Purchaser agrees, severally and not
jointly, to indemnify and hold harmless the Company, the Guarantors and each of
their directors, officers and employees, and each person, if any, who controls
the Company or the Guarantors within the meaning of the Securities Act or the
Exchange Act, against any loss, claim, damage, liability or expense, as
incurred, to which the Company, the Guarantors or any such director, officer,
employee or controlling person may become subject, under the Securities Act, the
Exchange Act, or other federal or state statutory law or regulation, or at
common law or otherwise (including in settlement of any litigation, if such
settlement is effected with the written consent of such Initial Purchaser),
insofar as such loss, claim, damage, liability or expense (or actions in respect
thereof as contemplated below) arises out of or is based upon any untrue or
alleged untrue statement of a material fact contained in the Disclosure Package
or the Final Offering Memorandum (or any amendment or supplement thereto), or
arises out of or is based upon the omission or alleged omission to state therein
a material fact required to be stated therein or necessary to make the
statements therein not misleading, in each case to the extent, but only to the
extent, that such untrue statement or alleged untrue statement or omission or
alleged omission was made in the Disclosure Package or the Final Offering

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Memorandum (or any amendment or supplement thereto), in reliance upon and in
conformity with written information furnished to the Company by the Initial
Purchasers expressly for use therein; and to reimburse the Company, the
Guarantors or any such director, officer or controlling person for any legal and
other expenses as such expenses are reasonably incurred by the Company, the
Guarantors or any such director, officer or controlling person in connection
with investigating, defending, settling, compromising or paying any such loss,
claim, damage, liability, expense or action. Each of the Company and the
Guarantors hereby acknowledges that the only information that the Initial
Purchasers have furnished to the Company expressly for use in the Disclosure
Package or the Final Offering Memorandum (or any amendment or supplement
thereto) are the statements set forth (1) in the third sentence of the second
paragraph under the caption “Plan of Distribution, (2) in the third sentence of
the first paragraph under the subheading “New Issue of Notes,” (3) in the
second, third and fourth sentences of the first paragraph and in the second
paragraph under the subheading “Price Stabilization and Short Positions” but
only insofar as such information relates to the Initial Purchasers and (4) in
the first and second sentence under the subheading “Electronic Distribution,” in
each case, under the caption “Plan of Distribution” in the Disclosure Package
and the Final Offering Memorandum; and the Initial Purchasers confirm that such
statements are correct. The indemnity agreement set forth in this Section 8
shall be in addition to any liabilities that each Initial Purchaser may
otherwise have.
     (c) Notifications and Other Indemnification Procedures. Promptly after
receipt by an indemnified party under this Section 8 of notice of the
commencement of any action, such indemnified party will, if a claim in respect
thereof is to be made against an indemnifying party under this Section 8, notify
the indemnifying party in writing of the commencement thereof, but the omission
so to notify the indemnifying party will not relieve it from any liability which
it may have to any indemnified party for contribution or otherwise under the
indemnity agreement contained in this Section 8 or to the extent it is not
prejudiced as a proximate result of such failure. In case any such action is
brought against any indemnified party and such indemnified party seeks or
intends to seek indemnity from an indemnifying party, the indemnifying party
will be entitled to participate in and, to the extent that it shall elect,
jointly with all other indemnifying parties similarly notified, by written
notice delivered to the indemnified party promptly after receiving the aforesaid
notice from such indemnified party, to assume the defense thereof with counsel
reasonably satisfactory to such indemnified party; provided, however, if the
defendants in any such action include both the indemnified party and the
indemnifying party and the indemnified party shall have reasonably concluded
that a conflict may arise between the positions of the indemnifying party and
the indemnified party in conducting the defense of any such action or that there
may be legal defenses available to it and/or other indemnified parties which are
different from or additional to those available to the indemnifying party, the
indemnified party or parties shall have the right to select separate counsel to
assume such legal defenses and to otherwise participate in the defense of such
action on behalf of such indemnified party or parties. Upon receipt of notice
from the indemnifying party to such indemnified party of such indemnifying
party’s election so to assume the defense of such action and approval by the
indemnified party of counsel, the indemnifying party will not be liable to such
indemnified party under this Section 8 for any legal or other expenses
subsequently incurred by such

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indemnified party in connection with the defense thereof unless (i) the
indemnified party shall have employed separate counsel in accordance with the
proviso to the next preceding sentence (it being understood, however, that the
indemnifying party shall not be liable for the expenses of more than one
separate counsel (together with local counsel), approved by the indemnifying
party (Merrill Lynch or the Company, as the case may be, in the case of
Section 8 and Section 9), representing the indemnified parties who are parties
to such action) or (ii) the indemnifying party shall not have employed counsel
satisfactory to the indemnified party to represent the indemnified party within
a reasonable time after notice of commencement of the action, in each of which
cases the fees and expenses of counsel shall be at the expense of the
indemnifying party.
     (d) Settlements. The indemnifying party under this Section 8 shall not be
liable for any settlement of any proceeding effected without its written
consent, but if settled with such consent or if there be a final judgment for
the plaintiff, the indemnifying party agrees to indemnify the indemnified party
against any loss, claim, damage, liability or expense by reason of such
settlement or judgment. Notwithstanding the foregoing sentence, if at any time
an indemnified party shall have requested an indemnifying party to reimburse the
indemnified party for fees and expenses of counsel as contemplated by Section 8
hereof, the indemnifying party agrees that it shall be liable for any settlement
of any proceeding effected without its written consent if (i) such settlement is
entered into more than 30 days after receipt by such indemnifying party of the
aforesaid request and (ii) such indemnifying party shall not have reimbursed the
indemnified party in accordance with such request prior to the date of such
settlement. No indemnifying party shall, without the prior written consent of
the indemnified party, effect any settlement, compromise or consent to the entry
of judgment in any pending or threatened action, suit or proceeding in respect
of which any indemnified party is or could have been a party and indemnity was
or could have been sought hereunder by such indemnified party, unless such
settlement, compromise or consent includes an unconditional release of such
indemnified party from all liability on claims that are the subject matter of
such action, suit or proceeding.
          Section 9. Contribution. If the indemnification provided for in
Section 8 is for any reason held to be unavailable to or otherwise insufficient
to hold harmless an indemnified party in respect of any losses, claims, damages,
liabilities or expenses referred to therein, then each indemnifying party shall
contribute to the aggregate amount paid or payable by such indemnified party, as
incurred, as a result of any losses, claims, damages, liabilities or expenses
referred to therein (i) in such proportion as is appropriate to reflect the
relative benefits received by the Company and the Guarantors on the one hand,
and the Initial Purchasers, on the other hand, from the offering of the
Securities pursuant to this Agreement or (ii) if the allocation provided by
clause (i) above is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred to in clause
(i) above but also the relative fault of the Company and the Guarantors, on the
one hand, and the Initial Purchasers, on the other hand, in connection with the
statements or omissions or inaccuracies in the representations and warranties
herein which resulted in such losses, claims, damages, liabilities or expenses,
as well as any other relevant equitable considerations. The relative benefits
received by the Company and the Guarantors, on the one hand, and the Initial
Purchasers, on the other hand, in connection with the offering of the Securities
pursuant to this Agreement shall be

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deemed to be in the same respective proportions as the total net proceeds from
the offering of the Securities pursuant to this Agreement (before deducting
expenses) received by the Company and the Guarantors, and the total discount
received by the Initial Purchasers bear to the aggregate initial offering price
of the Securities. The relative fault of the Company and the Guarantors, on the
one hand, and the Initial Purchasers, on the other hand, shall be determined by
reference to, among other things, whether any such untrue or alleged untrue
statement of a material fact or omission or alleged omission to state a material
fact or any such inaccurate or alleged inaccurate representation or warranty
relates to information supplied by the Company or the Guarantors, on the one
hand, or the Initial Purchasers, on the other hand, and the parties’ relative
intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission.
          The amount paid or payable by a party as a result of the losses,
claims, damages, liabilities and expenses referred to above shall be deemed to
include, subject to the limitations set forth in Section 8, any legal or other
fees or expenses reasonably incurred by such party in connection with
investigating or defending any action or claim. The provisions set forth in
Section 8 with respect to notice of commencement of any action shall apply if a
claim for contribution is to be made under this Section 9; provided, however,
that no additional notice shall be required with respect to any action for which
notice has been given under Section 8(c) for purposes of indemnification.
          The Company, the Guarantors and the Initial Purchasers agree that it
would not be just and equitable if contribution pursuant to this Section 9 were
determined by pro rata allocation (even if the Initial Purchasers were treated
as one entity for such purpose) or by any other method of allocation which does
not take account of the equitable considerations referred to in this Section 9.
          Notwithstanding the provisions of this Section 9, the Initial
Purchasers shall not be required to contribute any amount in excess of the
discount received by the Initial Purchaser in connection with the Securities
distributed by them. No person guilty of fraudulent misrepresentation (within
the meaning of Section 11 of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. The Initial Purchasers’ obligations to contribute pursuant to
this Section 9 are several, and not joint, in proportion to their respective
commitments as set forth opposite their names in Schedule B. For purposes of
this Section 9, each director, officer and employee of the Initial Purchasers
and each person, if any, who controls any of the Initial Purchasers within the
meaning of the Securities Act and the Exchange Act shall have the same rights to
contribution as the Initial Purchasers, and each director, officer and employee
of the Company or any Guarantor, and each person, if any, who controls the
Company or any Guarantor with the meaning of the Securities Act and the Exchange
Act shall have the same rights to contribution as the Company or any Guarantor.
          Section 10. Termination of this Agreement. Prior to the Closing Date,
this Agreement may be terminated by the Initial Purchasers by notice given to
the Company if at any time (i) trading or quotation in any of the Company’s
securities shall have been suspended or limited by the Commission or by the
NASDAQ Global Select Market, or trading in securities generally on either the
NASDAQ Global Select Market or the New York Stock Exchange shall

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have been suspended or limited, or minimum or maximum prices shall have been
generally established on any of such stock exchanges by the Commission or the
NASD; (ii) a general banking moratorium shall have been declared by any of
federal, New York, Louisiana or California authorities; (iii) there shall have
occurred any outbreak or escalation of national or international hostilities or
any crisis or calamity, or any change in the United States or international
financial markets, or any substantial change or development involving a
prospective substantial change in United States’ or international political,
financial or economic conditions, as in the judgment of the Initial Purchasers
is material and adverse and makes it impracticable to market the Securities in
the manner and on the terms described in the Disclosure Package and the Final
Offering Memorandum or to enforce contracts for the sale of securities; (iv) in
the reasonable judgment of the Initial Purchasers there shall have occurred any
Material Adverse Change; or the Company or any Guarantor shall have sustained a
loss by fire, strike, flood, earthquake, accident or other calamity of such
character as in the reasonable judgment of the Initial Purchasers, may interfere
materially with the conduct of the business and operation of the Company or the
Guarantors, considered as one entity, regardless of whether or not such loss
shall have been insured, or (v) a material disruption has occurred in commercial
banking or securities settlement or clearance services in the United States. Any
termination pursuant to this Section 10 shall be without liability on the part
of (a) the Company or any Guarantor to any Initial Purchaser, except that the
Company and any Guarantor shall be obligated to reimburse the expenses of the
Initial Purchasers pursuant to Section 4 and to the extent applicable Section 6
hereof, (b) any Initial Purchaser to the Company or any Guarantor, or (c) of any
party hereto to any other party except that the provisions of Section 8 and
Section 9 shall at all times be effective and shall survive such termination.
          Section 11. Representations and Indemnities to Survive Delivery. The
respective indemnities, agreements, representations, warranties and other
statements of the Company and the Guarantors and their respective officers and
of the several Initial Purchasers set forth in or made pursuant to this
Agreement will remain in full force and effect, regardless of any investigation
made by or on behalf of any Initial Purchaser, the Company or any Guarantor or
any of its or their partners, officers or directors or any controlling person,
as the case may be, and will survive delivery of and payment for the Securities
sold hereunder and any termination of this Agreement.
          Section 12. Notices. All communications hereunder shall be in writing
and shall be mailed, hand delivered couriered or facsimiled and confirmed to the
parties hereto as follows:
If to the Initial Purchasers:
Merrill Lynch & Co.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
4 World Financial Center
New York, NY 10080
Facsimile: 212-449-3207
Attention: Global Origination Counsel Group

27

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with a copy to:
Sidley Austin LLP
787 Seventh Avenue
New York, NY 10019
Facsimile: 212-839-5599
Attention: Robert Mandell
If to the Company:
Stewart Enterprises, Inc.
1333 S. Clearview Parkway
Jefferson, LA 70121
Facsimile: 504-729-1407
Attention: Thomas M. Kitchen, Chief Financial Officer
with a copy to:
Jones, Walker, Waechter, Poitevent,
Carrère and Denègre, L.L.P.
201 St. Charles Avenue
New Orleans, LA 70170-5100
Telecopier No.: (504) 582-8012
Attention: L. Richards McMillan, II, Esq.
          Any party hereto may change the address or facsimile for receipt of
communications by giving written notice to the others.
          Section 13. Successors. This Agreement will inure to the benefit of
and be binding upon the parties hereto, including any substitute Initial
Purchasers pursuant to Section 16 hereof, and to the benefit of the employees,
officers and directors and controlling persons referred to in Section 8 and
Section 9, and in each case their respective successors, and no other person
will have any right or obligation hereunder. The term “successors” shall not
include any purchaser of the Securities as such from any of the Initial
Purchasers merely by reason of such purchase.
          Section 14. Partial Unenforceability. The invalidity or
unenforceability of any Section, paragraph or provision of this Agreement shall
not affect the validity or enforceability of any other Section, paragraph or
provision hereof. If any Section, paragraph or provision of this Agreement is
for any reason determined to be invalid or unenforceable, there shall be deemed
to be made such minor changes (and only such minor changes) as are necessary to
make it valid and enforceable.
          Section 15. Governing Law; Consent to Jurisdiction.
     (a) Governing Law Provisions. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE INTERNAL

28

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LAWS OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED
IN SUCH STATE.
     (b) Consent to Jurisdiction. Any legal suit, action or proceeding arising
out of or based upon this Agreement or the transactions contemplated hereby
(“Related Proceedings”) may be instituted in the federal courts of the United
States of America located in the City and County of New York or the courts of
the State of New York in each case located in the City and County of New York
(collectively, the “Specified Courts”), and each party irrevocably submits to
the non-exclusive jurisdiction (except for proceedings instituted in regard to
the enforcement of a judgment of any such court (a “Related Judgment”), as to
which such jurisdiction is non-exclusive) of such courts in any such suit,
action or proceeding. Service of any process, summons, notice or document by
mail to such party’s address set forth above shall be effective service of
process for any suit, action or other proceeding brought in any such court. The
parties irrevocably and unconditionally waive any objection to the laying of
venue of any suit, action or other proceeding in the Specified Courts and
irrevocably and unconditionally waive and agree not to plead or claim in any
such court that any such suit, action or other proceeding brought in any such
court has been brought in an inconvenient forum.
          Section 16. Default of One or More of the Several Initial Purchasers.
If any one or more of the several Initial Purchasers shall fail or refuse to
purchase Securities that it or they have agreed to purchase hereunder on the
Closing Date, and the aggregate principal amount of Securities which such
defaulting Initial Purchaser or Initial Purchasers agreed but failed or refused
to purchase does not exceed 10% of the aggregate principal amount of the
Securities to be purchased on such date, the other Initial Purchasers shall be
obligated, severally, in the proportions that the principal amount of Securities
set forth opposite their respective names on Schedule B bears to the aggregate
principal amount of Securities set forth opposite the names of all such
non-defaulting Initial Purchasers, or in such other proportions as may be
specified by the Initial Purchasers with the consent of the non-defaulting
Initial Purchasers, to purchase the Securities which such defaulting Initial
Purchaser or Initial Purchasers agreed but failed or refused to purchase on such
date. If any one or more of the Initial Purchasers shall fail or refuse to
purchase Securities and the aggregate principal amount of Securities with
respect to which such default occurs exceeds 10% of the aggregate principal
amount of Securities to be purchased on such date, and arrangements satisfactory
to the Initial Purchasers and the Company for the purchase of such Securities
are not made within 48 hours after such default, this Agreement shall terminate
without liability of any party to any other party, but only as to such
non-defaulting Initial Purchasers, and except that the provisions of Section 4,
Section 6, Section 8 and Section 9 shall at all times be effective and shall
survive such termination. In any such case either the Initial Purchasers or the
Company shall have the right to postpone the Closing Date, as the case may be,
but in no event for longer than seven days in order that the required changes,
if any, to the Disclosure Package and the Final Offering Memorandum or any other
documents or arrangements may be effected.
          As used in this Agreement, the term “Initial Purchaser” shall be
deemed to include any person substituted for a defaulting Initial Purchaser
under this Section 16. Any action taken under this Section 16 shall not relieve
any defaulting Initial Purchaser from liability in respect of any default of
such Initial Purchaser under this Agreement.

29

--------------------------------------------------------------------------------

 

          Section 17. No Advisory or Fiduciary Relationship. The Company
acknowledges and agrees that (a) the purchase and sale of the Securities
pursuant to this Agreement, including the determination of the offering price of
the Securities and any related discounts and commissions, is an arm’s-length
commercial transaction between the Company and the Guarantors, on the one hand,
and the several Initial Purchasers, on the other hand, (b) in connection with
the offering contemplated hereby and the process leading to such transaction
each Initial Purchaser is and has been acting solely as a principal and is not
the agent or fiduciary of the Company or any of the Guarantors, or its
stockholders, creditors, employees or any other party, (c) no Initial Purchaser
has assumed or will assume an advisory or fiduciary responsibility in favor of
the Company or any of the Guarantors with respect to the offering contemplated
hereby or the process leading thereto (irrespective of whether such Initial
Purchaser has advised or is currently advising the Company or any of the
Guarantors on other matters) and no Initial Purchaser has any obligation to the
Company or any of the Guarantors with respect to the offering contemplated
hereby except the obligations expressly set forth in this Agreement, (d) the
Initial Purchasers and their Affiliates may be engaged in a broad range of
transactions that involve interests that differ from those of the Company and
the Guarantors, and (e) no Initial Purchaser has provided any legal, accounting,
regulatory or tax advice with respect to the offering contemplated hereby and
the Company and the Guarantors have consulted their own legal, accounting,
regulatory and tax advisors to the extent they deemed appropriate.
          Section 18. General Provisions. This Agreement constitutes the entire
agreement of the parties to this Agreement and supersedes all prior written or
oral and all contemporaneous oral agreements, understandings and negotiations
with respect to the subject matter hereof. This Agreement may be executed in two
or more counterparts, each one of which shall be an original, with the same
effect as if the signatures thereto and hereto were upon the same instrument.
This Agreement may not be amended or modified unless in writing by all of the
parties hereto, and no condition herein (express or implied) may be waived
unless waived in writing by each party whom the condition is meant to benefit.
The Table of Contents and the section headings herein are for the convenience of
the parties only and shall not affect the construction or interpretation of this
Agreement.

30

--------------------------------------------------------------------------------

 

          If the foregoing is in accordance with your understanding of our
agreement, kindly sign and return to the Company the enclosed copies hereof,
whereupon this instrument, along with all counterparts hereof, shall become a
binding agreement in accordance with its terms.

            Very truly yours,

STEWART ENTERPRISES, INC.
      By:           Name:   Thomas M. Kitchen        Title:   Senior Executive
Vice President and Chief Financial Officer     

GUARANTORS:
KILGORE-GREEN FUNERAL HOME, INC.
S.E. CEMETERIES OF ALABAMA, INC.
S.E. COMBINED SERVICES OF ALABAMA, INC.
S.E. FUNERAL HOMES OF ALABAMA, INC.
FOREST HILLS CEMETERY, INC.
GRIFFIN-LEGGETT INSURANCE AGENCY, INC.
GRIFFIN-LEGGETT, INC.
GROSS FUNERAL HOME, INC.
S.E. FUNERAL HOMES OF ARKANSAS, INC.
ALL SOULS MORTUARY, INC.
ASHES TO ASHES, INC.
ASSUMPTION MORTUARY, INC.
BARSTOW FUNERAL HOMES, INC.
BUCHHEIM FAMILY, INC.
CALVARY MORTUARY OF LOS ANGELES, CALIFORNIA, INC.
CATALINA CHANNEL CREMATION SOCIETY
CATHOLIC MORTUARY SERVICES, INC.
DeYOUNG MEMORIAL CHAPEL, INC.
DILDAY BROTHERS HUNTINGTON VALLEY MORTUARY
HOLY CROSS MORTUARY OF CULVER CITY, CALIFORNIA, INC.
HOLY CROSS MORTUARY OF POMONA, CALIFORNIA, INC.
HOPSON MORTUARY, INC.
LASSILA FUNERAL CHAPELS, INC.
LOMBARD & CO.
N.D. DAVIS & ASSOCIATES, INC.
QUEEN OF HEAVEN MORTUARY, INC.
RESURRECTION MORTUARY, INC.
RIVER CITIES FUNERAL CHAPEL, INC.
S.E. ACQUISITION OF CALIFORNIA, INC.
S.E. ACQUISITION OF DELANO, CALIFORNIA, INC.

31

--------------------------------------------------------------------------------

 

S.E. ACQUISITION OF GLENDALE, CALIFORNIA, INC.
S.E. ACQUISITION OF LANCASTER, CALIFORNIA, INC.
S.E. ACQUISITION OF LOS OSOS MORTUARY AND MEMORIAL PARK, INC.
S.E. ACQUISITION OF OAKHURST, CALIFORNIA, INC.
S.E. ACQUISITION OF OROVILLE, CALIFORNIA, INC.
SAN DIEGO CEMETERY ASSOCIATION
SAN FERNANDO MISSION MORTUARY, INC.
SANTA BARBARA FUNERAL SERVICES, INC.
SANTA CLARA MORTUARY, INC.
SCOVERN MORTUARY, A CALIFORNIA CORPORATION
SDCA HOLDINGS, INC.
SIMPLICITY PLAN OF CALIFORNIA, INC.
STEWART PRE-NEED SERVICES, INC.
STRICKLIN/SNIVELY MORTUARY
VICTOR V. DESROSIER, INC.
WALLACE E. WHITE & HOWARD J. CALLANAN, INC.
SENTINEL CREMATION SOCIETIES, INC.
A.P. BOZA FUNERAL HOME, INC.
ALL FAITHS MEMORIAL PARK, INC.
ARLINGTON MEMORIAL PARK CEMETERY AND FUNERAL HOME, INC.
BALDWIN-FAIRCHILD FUNERAL HOMES, INC.
BAY AREA CREMATORY, INC.
S.E. BD TAMPA, INC.
BRUCE OCALA FUNERAL HOME, INC.
CEMETERY MANAGEMENT, INC.
CHAPEL HILL CEMETERY, INC.
CURRY & SON FUNERAL HOME, INC.
S.E. DCG TAMPA, INC.
FLORIDA HILLS MEMORIAL GARDENS, INC.
GARDEN OF MEMORIES, INC.
GLEN HAVEN MEMORIAL PARK, INC.
GOOD SHEPHERD MEMORIAL GARDENS, INC.
HIGHLAND MEMORY GARDENS, INC.
HUBBELL FUNERAL HOME AND CREMATORY, INC.
KICLITER FUNERAL HOME, INC.
MADCEM OF FLORIDA, INC.
MEMORIAL PARK CEMETERY, INC.
MEMORIAL SUNSET PARK, INC.
OAKLAWN PARK CEMETERY AND FUNERAL HOME, INC.
ROBERTS FUNERAL HOME, INC.
ROYAL PALM MEMORIAL GARDENS, INC.
SEMORAN FUNERAL HOME, INC.
SOUTH DADE-PALMS MEMORIAL PARK, INC.
SYLVAN ABBEY MEMORIAL PARK, INC.
THE SIMPLICITY PLAN, INC.
TURNER CREMATORY, INC.

32

--------------------------------------------------------------------------------

 

TURNER FUNERAL HOMES, INC.
WALSH & WOOD FUNERAL HOME, INC.
WOODLAWN MEMORY GARDENS, INC.
WOODLAWN PARK CEMETERY COMPANY
CHEATHAM HILL MEMORIAL PARK, INC.
EASTLAWN CORPORATION
GARNER FAMILY FUNERAL HOME, INC.
HAISTEN FUNERAL HOME OF HENRY COUNTY, INC.
HAISTEN FUNERAL HOMES, INC.
HIGGINS AND SON FUNERAL HOME, INC.
HOLLY HILL MEMORIAL PARK, INC.
ROSEHAVEN FUNERAL HOME & CEMETERY, INC.
S.E. ACQUISITION OF LITHONIA, GEORGIA, INC.
S.E. FUNERAL HOMES OF ILLINOIS, INC.
KNUTSON FUNERAL HOMES, INC.
PAULEY FUNERAL HOME, INC.
RUNYAN MANGOLD, INC.
ACME MAUSOLEUM CORPORATION
ENDURING MEMORIES, INC.
EMPRESAS STEWART — CEMENTERIOS, INC.
EMPRESAS STEWART — FUNERARIAS, INC.
LAKE LAWN METAIRIE FUNERAL HOME (JOINT VENTURE)
S.E. AUSTRALIA, INC.
S.E. CEMETERIES OF LOUISIANA, INC.
S.E. FUNERAL HOMES OF LOUISIANA, INC.
S.E. SOUTH-CENTRAL, INC.
STEWART ENTERPRISES (EUROPE) INC.
STEWART RESOURCE CENTER, INC.
STEWART SERVICES, INC.
BOUNDS FUNERAL HOME, INC.
CEDAR HILL CEMETERY COMPANY, INC.
CREST LAWN MEMORIAL GARDENS, INC.
DRUID RIDGE CEMETERY COMPANY
FORT LINCOLN CEMETERY, INC.
FORT LINCOLN FUNERAL HOME, INC.
GALLERY GRANITE CORPORATION
HILLCREST MEMORIAL CEMETERY, INC.
HINES-RINALDI FUNERAL HOME, INC.
JOHN M. TAYLOR FUNERAL HOME, INC.
LOUDON PARK CEMETERY COMPANY
LOUDON PARK FUNERAL HOME, INC.
NATIONAL HARMONY MEMORIAL PARK, INC.
PARKLAWN, INC.
PARK WOOD MANAGEMENT COMPANY
S.E. MID-ATLANTIC, INC.
SIMPLE TRIBUTE OF MARYLAND, INC.

33

--------------------------------------------------------------------------------

 

THE PARKWOOD CEMETERY COMPANY
WILLIAM W. CHAMBERS, INC.
LAKEWOOD MEMORIAL PARK, INC.
D.W. NEWCOMER’S SONS, INC.
DWN PROPERTIES, INC.
FUNERAL SECURITY PLANS, INC.
THE LINCOLN MEMORIAL PARK CEMETERY ASSOCIATION
S.E.N.S. OF NEVADA, INC.
RENO MEMORIAL, INC.
S.E. ACQUISITION OF NEVADA, INC.
S.E. ACQUISITION OF RENO, NEVADA, INC.
GORNY & GORNY PATERSON-CLIFTON MORTUARY
S.E. ACQUISITION OF CLIFTON, NEW JERSEY, INC.
S.E. ACQUISITION OF SANTA FE, NEW MEXICO, INC.
C.J. APPLEGATE AND SONS, INC.
CORNELL & DAGGETT, INC.
GARDINIER COLLETTI MEMORIAL HOME, INC.
MURPHY FUNERAL SERVICE, INC.
OTTO REDANZ FUNERAL HOME, INC.
S.E. ACQUISITION OF FREDONIA, NEW YORK, INC.
STRONG & BURNS FUNERAL HOME, INC.
CATAWBA MEMORIAL PARK, INC.
EVANS FUNERAL HOME, INC.
GARRETT — HILLCREST, INC.
MCLAURIN’S FUNERAL HOME, INC.
MONTLAWN MEMORIAL PARK, INC.
S.E. CEMETERIES OF NORTH CAROLINA, INC.
S.E. FUNERAL HOMES OF NORTH CAROLINA, INC.
AMLING/SCHROEDER FUNERAL SERVICE, INC.
CASCADE CREMATORY, INC.
CHAPEL OF THE ROSES, INC.
CHAPEL OF THE VALLEY FUNERAL HOME, INC.
DUTTON, INC.
S.E. GREENWOOD, INC.
J.P. FINLEY AND SON MORTUARY, INC.
S.E. BEND NR, INC.
S.E. ACQUISITION OF MYRTLE CREEK, OREGON, INC.
S.E. ACQUISITION OF OREGON, INC.
S.E. ACQUISITION OF REEDSPORT, OREGON, INC.
SUNSET HILLS MEMORIAL PARK
S.E. BEND TDHM, INC.
BENJAMIN FRANKLIN P. M., INC.
GEORGE WASHINGTON MEMORIAL PARK, INC.
KIRK & NICE SUBURBAN CHAPEL, INC.
KIRK & NICE, INC.
PET HAVEN, INC.

34

--------------------------------------------------------------------------------

 

S.E. ACQUISITION OF PENNSYLVANIA, INC.
SUNSET MEMORIAL PARK COMPANY
DUNBAR FUNERAL HOME
S.E. CEMETERIES OF SOUTH CAROLINA, INC.
S.E. COMBINED SERVICES OF SOUTH CAROLINA, INC.
S.E. FUNERAL HOMES OF SOUTH CAROLINA, INC.
MONTE VISTA BURIAL PARK, INC.
MT. JULIET MEMORIAL GARDENS, INC.
NAVE FUNERAL HOME OF LEBANON, INC.
S.E. COMBINED SERVICES OF TENNESSEE, INC.
S.E. FUNERAL HOMES OF TENNESSEE, INC.
THE NASHVILLE HISTORIC CEMETERY ASSOCIATION, INC.
ABBEY PLAN OF TEXAS, INC.
BELEW FUNERAL HOME, INC.
EMERALD HILLS FUNERAL CORPORATION
GUARDIAN CREMATION SOCIETY, INC.
LYONS FUNERAL HOME, INC.
PASADENA FUNERAL HOME, INC.
S.E. FUNERAL HOMES OF TEXAS, INC.
S.E. CEMETERIES OF TEXAS, INC.
SIMPLICITY PLAN OF TEXAS, INC.
CLINCH VALLEY MEMORIAL CEMETERY, INC.
EVERLY FUNERAL HOMES, INCORPORATED
EVERLY PEP, INC.
MONTICEI.LO MEMORY GARDENS, INC.
S.E. CEMETERIES OF VIRGINIA, INC.
S.E. FUNERAL HOMES OF VIRGINIA, INC.
CREMATION SOCIETY NORTHWEST, INC.
E.R. BUTTERWORTH & SONS
S.E.E.S. OF VANCOUVER, INC.
S.E. ACQUISITION OF WASHINGTON, INC.
BARTLETT-BURDETTE-COX FUNERAL HOME, INC.
CASDORPH & CURRY FUNERAL HOME, INC.
EASTERN CEMETERY ASSOCIATES, INC.
KANAWHA PLAZA PARTNERSHIP
KLINGEL-CARPENTER MORTUARY, INC.
LOI CHARLESTON, INC.
NATIONAL EXCHANGE TRUST, LTD.
NATIONAL FUNERAL SERVICES, INCORPORATED
S.E. ACQUISITION OF MALDEN, WEST VIRGINIA, INC.
S.E. CEMETERIES OF WEST VIRGINIA, INC.
S.E. FUNERAL HOMES OF WEST VIRGINIA, INC.
WILSON FUNERAL HOME, INC.

35

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        S.E. CEMETERIES OF WISCONSIN, INC.    
 
       
By:
       
 
       
 
  Name: Thomas M. Kitchen    
 
  Title: Authorized Signatory    

36

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The foregoing Purchase Agreement is hereby confirmed and accepted by the Initial
Purchasers as of the date first above written.
MERRILL LYNCH & CO.
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
BANC OF AMERICA SECURITIES LLC
BNP PARIBAS SECURITIES CORP.
CALYON SECURITIES (USA) INC.
CAPITAL ONE SOUTHCOAST, INC.
SUNTRUST CAPITAL MARKETS, INC.
U.S. BANCORP INVESTMENTS, INC.

         
 
       
By:
  MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED    
 
       
By:
       
 
       
 
  Name: Justin Walter    
 
  Title: Vice President    

For itself and as Representative of the other Initial Purchasers named in
Schedule B hereto.

37

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SCHEDULE A
LIST OF GUARANTORS

          Jurisdiction of Subsidiary   Organization
KILGORE-GREEN FUNERAL HOME, INC.
  ALABAMA
S.E. CEMETERIES OF ALABAMA, INC.
  ALABAMA
S.E. COMBINED SERVICES OF ALABAMA, INC.
  ALABAMA
S.E. FUNERAL HOMES OF ALABAMA, INC.
  ALABAMA
FOREST HILLS CEMETERY, INC.
  ARKANSAS
GRIFFIN-LEGGETT INSURANCE AGENCY, INC.
  ARKANSAS
GRIFFIN-LEGGETT, INC.
  ARKANSAS
GROSS FUNERAL HOME, INC.
  ARKANSAS
S.E. FUNERAL HOMES OF ARKANSAS, INC.
  ARKANSAS
ALL SOULS MORTUARY, INC.
  CALIFORNIA
ASHES TO ASHES, INC.
  CALIFORNIA
ASSUMPTION MORTUARY, INC.
  CALIFORNIA
BARSTOW FUNERAL HOMES, INC.
  CALIFORNIA
BUCHHEIM FAMILY, INC.
  CALIFORNIA
CALVARY MORTUARY OF LOS ANGELES, CALIFORNIA, INC.
  CALIFORNIA
CATALINA CHANNEL CREMATION SOCIETY
  CALIFORNIA
CATHOLIC MORTUARY SERVICES, INC.
  CALIFORNIA
DeYOUNG MEMORIAL CHAPEL, INC.
  CALIFORNIA
DILDAY BROTHERS HUNTINGTON VALLEY MORTUARY
  CALIFORNIA
HOLY CROSS MORTUARY OF CULVER CITY, CALIFORNIA, INC.
  CALIFORNIA
HOLY CROSS MORTUARY OF POMONA, CALIFORNIA, INC.
  CALIFORNIA
HOPSON MORTUARY, INC.
  CALIFORNIA
LASSILA FUNERAL CHAPELS, INC.
  CALIFORNIA
LOMBARD & CO.
  CALIFORNIA
N.D. DAVIS & ASSOCIATES, INC.
  CALIFORNIA
QUEEN OF HEAVEN MORTUARY, INC.
  CALIFORNIA
RESURRECTION MORTUARY, INC.
  CALIFORNIA
RIVER CITIES FUNERAL CHAPEL, INC.
  CALIFORNIA
S.E. ACQUISITION OF CALIFORNIA, INC.
  CALIFORNIA
S.E. ACQUISITION OF DELANO, CALIFORNIA, INC.
  CALIFORNIA
S.E. ACQUISITION OF GLENDALE, CALIFORNIA, INC.
  CALIFORNIA
S.E. ACQUISITION OF LANCASTER, CALIFORNIA, INC.
  CALIFORNIA
S.E. ACQUISITION OF OAKHURST, CALIFORNIA, INC.
  CALIFORNIA

Sched A -1

--------------------------------------------------------------------------------

 

          Jurisdiction of Subsidiary   Organization
S.E. ACQUISITION OF LOS OSOS MORTUARY AND MEMORIAL PARK, INC.
  CALIFORNIA
S.E. ACQUISITION OF OROVILLE, CALIFORNIA, INC.
  CALIFORNIA
SAN DIEGO CEMETERY ASSOCIATION
  CALIFORNIA
SAN FERNANDO MISSION MORTUARY, INC.
  CALIFORNIA
SANTA BARBARA FUNERAL SERVICES, INC.
  CALIFORNIA
SANTA CLARA MORTUARY, INC.
  CALIFORNIA
SCOVERN MORTUARY, A CALIFORNIA CORPORATION
  CALIFORNIA
SDCA HOLDINGS, INC.
  CALIFORNIA
SIMPLICITY PLAN OF CALIFORNIA, INC.
  CALIFORNIA
STEWART PRE-NEED SERVICES, INC.
  CALIFORNIA
STRICKLIN/SNIVELY MORTUARY
  CALIFORNIA
VICTOR V. DESROSIER, INC.
  CALIFORNIA
WALLACE E. WHITE & HOWARD J. CALLANAN, INC.
  CALIFORNIA
SENTINEL CREMATION SOCIETIES, INC.
  DELAWARE
A.P. BOZA FUNERAL HOME, INC.
  FLORIDA
ALL FAITHS MEMORIAL PARK, INC.
  FLORIDA
ARLINGTON MEMORIAL PARK CEMETERY AND FUNERAL HOME, INC.
  FLORIDA
BALDWIN-FAIRCHILD FUNERAL HOMES, INC.
  FLORIDA
BAY AREA CREMATORY, INC.
  FLORIDA
S.E. BD TAMPA, INC.
  FLORIDA
BRUCE OCALA FUNERAL HOME, INC.
  FLORIDA
CEMETERY MANAGEMENT, INC.
  FLORIDA
CHAPEL HILL CEMETERY, INC.
  FLORIDA
CURRY & SON FUNERAL HOME, INC.
  FLORIDA
S.E. DCG TAMPA, INC.
  FLORIDA
FLORIDA HILLS MEMORIAL GARDENS, INC.
  FLORIDA
GARDEN OF MEMORIES, INC.
  FLORIDA
GLEN HAVEN MEMORIAL PARK, INC.
  FLORIDA
GOOD SHEPHERD MEMORIAL GARDENS, INC.
  FLORIDA
HIGHLAND MEMORY GARDENS, INC.
  FLORIDA
HUBBELL FUNERAL HOME AND CREMATORY, INC.
  FLORIDA
KICLITER FUNERAL HOME, INC.
  FLORIDA
MADCEM OF FLORIDA, INC.
  FLORIDA
MEMORIAL PARK CEMETERY, INC.
  FLORIDA
MEMORIAL SUNSET PARK, INC.
  FLORIDA
OAKLAWN PARK CEMETERY AND FUNERAL HOME, INC.
  FLORIDA
ROBERTS FUNERAL HOME, INC.
  FLORIDA
ROYAL PALM MEMORIAL GARDENS, INC.
  FLORIDA
SEMORAN FUNERAL HOME, INC.
  FLORIDA
SOUTH DADE-PALMS MEMORIAL PARK, INC.
  FLORIDA
SYLVAN ABBEY MEMORIAL PARK, INC.
  FLORIDA

Sched A -2

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          Jurisdiction of Subsidiary   Organization
THE SIMPLICITY PLAN, INC.
  FLORIDA
TURNER CREMATORY, INC.
  FLORIDA
TURNER FUNERAL HOMES, INC.
  FLORIDA
WALSH & WOOD FUNERAL HOME, INC.
  FLORIDA
WOODLAWN MEMORY GARDENS, INC.
  FLORIDA
WOODLAWN PARK CEMETERY COMPANY
  FLORIDA
CHEATHAM HILL MEMORIAL PARK, INC.
  GEORGIA
EASTLAWN CORPORATION
  GEORGIA
GARNER FAMILY FUNERAL HOME, INC.
  GEORGIA
HAISTEN FUNERAL HOME OF HENRY COUNTY, INC.
  GEORGIA
HAISTEN FUNERAL HOMES, INC.
  GEORGIA
HIGGINS AND SON FUNERAL HOME, INC.
  GEORGIA
HOLLY HILL MEMORIAL PARK, INC.
  GEORGIA
ROSE HAVEN FUNERAL HOME & CEMETERY, INC.
  GEORGIA
S.E. ACQUISITION OF LITHONIA, GEORGIA, INC.
  GEORGIA
S.E. FUNERAL HOMES OF ILLINOIS, INC.
  ILLINOIS
KNUTSON FUNERAL HOMES, INC.
  IOWA
PAULEY FUNERAL HOME, INC.
  IOWA
RUNYAN MANGOLD, INC.
  KANSAS
ACME MAUSOLEUM CORPORATION
  LOUISIANA
ENDURING MEMORIES, INC.
  LOUISIANA
EMPRESAS STEWART — CEMENTERIOS, INC.
  LOUISIANA
EMPRESAS STEWART — FUNERARIAS, INC.
  LOUISIANA
LAKE LAWN METAIRIE FUNERAL HOME (JOINT VENTURE)
  LOUISIANA
S.E. AUSTRALIA, INC.
  LOUISIANA
S.E. CEMETERIES OF LOUISIANA, INC.
  LOUISIANA
S.E. FUNERAL HOMES OF LOUISIANA, INC.
  LOUISIANA
S.E. SOUTH-CENTRAL, INC.
  LOUISIANA
STEWART ENTERPRISES (EUROPE) INC.
  LOUISIANA
STEWART RESOURCE CENTER, INC.
  LOUISIANA
STEWART SERVICES, INC.
  LOUISIANA
BOUNDS FUNERAL HOME, INC.
  MARYLAND
CEDAR HILL CEMETERY COMPANY, INC.
  MARYLAND
CREST LAWN MEMORIAL GARDENS, INC.
  MARYLAND
DRUID RIDGE CEMETERY COMPANY
  MARYLAND
FORT LINCOLN CEMETERY, INC.
  MARYLAND
FORT LINCOLN FUNERAL HOME, INC.
  MARYLAND
GALLERY GRANITE CORPORATION
  MARYLAND
HILLCREST MEMORIAL CEMETERY, INC.
  MARYLAND
HINES-RINALDI FUNERAL HOME, INC.
  MARYLAND
JOHN M. TAYLOR FUNERAL HOME, INC.
  MARYLAND
LOUDON PARK CEMETERY COMPANY
  MARYLAND
LOUDON PARK FUNERAL HOME, INC.
  MARYLAND

Sched A -3

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          Jurisdiction of Subsidiary   Organization
NATIONAL HARMONY MEMORIAL PARK, INC.
  MARYLAND
PARKLAWN, INC.
  MARYLAND
PARKWOOD MANAGEMENT COMPANY
  MARYLAND
S.E. MID-ATLANTIC, INC.
  MARYLAND
SIMPLE TRIBUTE OF MARYLAND, INC.
  MARYLAND
THE PARKWOOD CEMETERY COMPANY
  MARYLAND
WILLIAM W. CHAMBERS, INC.
  MARYLAND
LAKEWOOD MEMORIAL PARK, INC.
  MISSISSIPPI
D.W. NEWCOMER’S SONS, INC.
  MISSOURI
DWN PROPERTIES, INC.
  MISSOURI
FUNERAL SECURITY PLANS, INC.
  MISSOURI
THE LINCOLN MEMORIAL PARK CEMETERY ASSOCIATION
  NEBRASKA
S.E.N.S. OF NEVADA, INC.
  NEVADA
S.E. ACQUISITION OF NEVADA, INC.
  NEVADA
S.E. ACQUISITION OF RENO, NEVADA, INC.
  NEVADA
S.E.N.S. OF NEVADA, INC.
  NEVADA
GORNY & GORNY PATERSON-CLIFTON MORTUARY
  NEW JERSEY
S.E. ACQUISITION OF CLIFTON, NEW JERSEY, INC.
  NEW JERSEY
S.E. ACQUISITION OF SANTA FE, NEW MEXICO, INC.
  NEW MEXICO
C.J. APPLEGATE AND SONS, INC.
  NEW YORK
CORNELL & DAGGETT, INC.
  NEW YORK
GARDINIER COLLETTI MEMORIAL HOME, INC.
  NEW YORK
MURPHY FUNERAL SERVICE, INC.
  NEW YORK
OTTO REDANZ FUNERAL HOME, INC.
  NEW YORK
S.E. ACQUISITION OF FREDONIA, NEW YORK, INC.
  NEW YORK
STRONG & BURNS FUNERAL HOME, INC.
  NEW YORK
CATAWBA MEMORIAL PARK, INC.
  NORTH CAROLINA
EVANS FUNERAL HOME, INC.
  NORTH CAROLINA
GARRETT — HILLCREST, INC.
  NORTH CAROLINA
MCLAURIN’S FUNERAL HOME, INC.
  NORTH CAROLINA
MONTLAWN MEMORIAL PARK, INC.
  NORTH CAROLINA
S.E. CEMETERIES OF NORTH CAROLINA, INC.
  NORTH CAROLINA
S.E. FUNERAL HOMES OF NORTH CAROLINA, INC.
  NORTH CAROLINA
AMLING SCHROEDER FUNERAL SERVICE, INC.
  OREGON
CASCADE CREMATORY, INC.
  OREGON
CHAPEL OF THE ROSES, INC.
  OREGON
CHAPEL OF THE VALLEY FUNERAL HOME, INC.
  OREGON
DUTTON, INC.
  OREGON
S.E. GREENWOOD, INC.
  OREGON
J.P. FINLEY AND SON MORTUARY, INC.
  OREGON
S.E. BEND NR, INC.
  OREGON
S.E. ACQUISITION OF MYRTLE CREEK, OREGON, INC.
  OREGON
S.E. ACQUISITION OF OREGON, INC.
  OREGON

Sched A -4

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          Jurisdiction of Subsidiary   Organization
S.E. ACQUISITION OF REEDSPORT, OREGON, INC.
  OREGON
SUNSET HILLS MEMORIAL PARK
  OREGON
S.E. BEND TDHM, INC.
  OREGON
BENJAMIN FRANKLIN P. M., INC.
  PENNSYLVANIA
GEORGE WASHINGTON MEMORIAL PARK, INC.
  PENNSYLVANIA
KIRK & NICE SUBURBAN CHAPEL, INC.
  PENNSYLVANIA
KIRK & NICE, INC.
  PENNSYLVANIA
PET HAVEN, INC.
  PENNSYLVANIA
S.E. ACQUISITION OF PENNSYLVANIA, INC.
  PENNSYLVANIA
SUNSET MEMORIAL PARK COMPANY
  PENNSYLVANIA
DUNBAR FUNERAL HOME
  SOUTH CAROLINA
S.E. CEMETERIES OF SOUTH CAROLINA, INC.
  SOUTH CAROLINA
S.E. COMBINED SERVICES OF SOUTH CAROLINA, INC.
  SOUTH CAROLINA
S.E. FUNERAL HOMES OF SOUTH CAROLINA, INC.
  SOUTH CAROLINA
MONTE VISTA BURIAL PARK, INC.
  TENNESSEE
MT. JULIET MEMORIAL GARDENS, INC.
  TENNESSEE
NAVE FUNERAL HOME OF LEBANON, INC.
  TENNESSEE
S.E. COMBINED SERVICES OF TENNESSEE, INC.
  TENNESSEE
S.E. FUNERAL HOMES OF TENNESSEE, INC.
  TENNESSEE
THE NASHVILLE HISTORIC CEMETERY ASSOCIATION, INC.
  TENNESSEE
ABBEY PLAN OF TEXAS, INC.
  TEXAS
BELEW FUNERAL HOME, INC.
  TEXAS
EMERALD HILLS FUNERAL CORPORATION
  TEXAS
GUARDIAN CREMATION SOCIETY, INC.
  TEXAS
LYONS FUNERAL HOME, INC.
  TEXAS
PASADENA FUNERAL HOME, INC.
  TEXAS
S.E. FUNERAL HOMES OF TEXAS, INC.
  TEXAS
S.E. CEMETERIES OF TEXAS, INC.
  TEXAS
SIMPLICITY PLAN OF TEXAS, INC.
  TEXAS
CLINCH VALLEY MEMORIAL CEMETERY, INC.
  VIRGINIA
EVERLY FUNERAL HOMES, INCORPORATED
  VIRGINIA
EVERLY PFP, INC.
  VIRGINIA
MONTICELLO MEMORY GARDENS, INC.
  VIRGINIA
S.E. CEMETERIES OF VIRGINIA, INC.
  VIRGINIA
S.E. FUNERAL HOMES OF VIRGINIA, INC.
  VIRGINIA
CREMATION SOCIETY NORTHWEST, INC.
  WASHINGTON
E.R. BUTTERWORTH & SONS
  WASHINGTON
S.E.E.S. OF VANCOUVER, INC.
  WASHINGTON
S.E. ACQUISITION OF WASHINGTON, INC.
  WASHINGTON
BARTLETT-BURDETTE-COX FUNERAL HOME, INC.
  WEST VIRGINIA
CASDORPH & CURRY FUNERAL HOME, INC.
  WEST VIRGINIA
EASTERN CEMETERY ASSOCIATES, INC.
  WEST VIRGINIA
KANAWHA PLAZA PARTNERSHIP
  WEST VIRGINIA

Sched A -5

--------------------------------------------------------------------------------

 

          Jurisdiction of Subsidiary   Organization
KLINGEL-CARPENTER MORTUARY, INC.
  WEST VIRGINIA
LOI CHARLESTON, INC.
  WEST VIRGINIA
NATIONAL EXCHANGE TRUST, LTD.
  WEST VIRGINIA
NATIONAL FUNERAL SERVICES, INCORPORATED
  WEST VIRGINIA
S.E. ACQUISITION OF MALDEN, WEST VIRGINIA, INC.
  WEST VIRGINIA
S.E. CEMETERIES OF WEST VIRGINIA, INC.
  WEST VIRGINIA
S.E. FUNERAL HOMES OF WEST VIRGINIA, INC.
  WEST VIRGINIA
WILSON FUNERAL HOME, INC.
  WEST VIRGINIA
S.E. CEMETERIES OF WISCONSIN, INC.
  WISCONSIN

Sched A -6

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SCHEDULE B
INITIAL PURCHASERS

                      Principal     Principal       Amount of     Amount of  
Initial Purchasers   2014 Notes     2016 Notes  
Merrill Lynch, Pierce, Fenner & Smith Incorporated
  $ 75,000,000     $ 75,000,000  
Banc of America Securities LLC
    37,500,000       37,500,000  
BNP Paribas Securities Corp.
    2,500,000       2,500,000  
Calyon Securities (USA) Inc.
    2,500,000       2,500,000  
Capital One Southcoast, Inc.
    2,500,000       2,500,000  
SunTrust Capital Markets, Inc.
    2,500,000       2,500,000  
U.S. Bancorp Investments, Inc.
    2,500,000       2,500,000  
 
           
Total
  $ 125,000,000     $ 125,000,000  
 
           

Sched B -1

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SCHEDULE C
PRICING TERM SHEET

Sched C -1

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SCHEDULE D
SUBSIDIARIES OF STEWART ENTERPRISES, INC.
PART I- ALL SUBSIDIARIES OF STEWART ENTERPRISES, INC.

          Jurisdiction of Subsidiary   Organization
KILGORE-GREEN FUNERAL HOME, INC.
  ALABAMA
S.E. CEMETERIES OF ALABAMA, INC.
  ALABAMA
S.E. COMBINED SERVICES OF ALABAMA, INC.
  ALABAMA
S.E. FUNERAL HOMES OF ALABAMA, INC.
  ALABAMA
FOREST HILLS CEMETERY, INC.
  ARKANSAS
GRIFFIN-LEGGETT INSURANCE AGENCY, INC.
  ARKANSAS
GRIFFIN-LEGGETT, INC.
  ARKANSAS
GROSS FUNERAL HOME, INC.
  ARKANSAS
REST HILLS MEMORIAL PARK, INC.
  ARKANSAS
S.E. FUNERAL HOMES OF ARKANSAS, INC.
  ARKANSAS
ALL SOULS MORTUARY, INC.
  CALIFORNIA
ASHES TO ASHES, INC.
  CALIFORNIA
ASSUMPTION MORTUARY, INC.
  CALIFORNIA
BARSTOW FUNERAL HOMES, INC.
  CALIFORNIA
BUCHHEIM FAMILY, INC.
  CALIFORNIA
CALVARY MORTUARY OF LOS ANGELES, CALIFORNIA, INC.
  CALIFORNIA
CATALINA CHANNEL CREMATION SOCIETY
  CALIFORNIA
CATHOLIC MORTUARY SERVICES, INC.
  CALIFORNIA
DeYOUNG MEMORIAL CHAPEL, INC.
  CALIFORNIA
DILDAY BROTHERS HUNTINGTON VALLEY MORTUARY
  CALIFORNIA
HOLY CROSS MORTUARY OF CULVER CITY, CALIFORNIA, INC.
  CALIFORNIA
HOLY CROSS MORTUARY OF POMONA, CALIFORNIA, INC.
  CALIFORNIA
HOPSON MORTUARY, INC.
  CALIFORNIA
LASSILA FUNERAL CHAPELS, INC.
  CALIFORNIA
LOMBARD & CO.
  CALIFORNIA
N.D. DAVIS & ASSOCIATES, INC.
  CALIFORNIA
QUEEN OF HEAVEN MORTUARY, INC.
  CALIFORNIA
RESURRECTION MORTUARY, INC.
  CALIFORNIA

Sched D -1

--------------------------------------------------------------------------------

 

          Jurisdiction of Subsidiary   Organization
RIVER CITIES FUNERAL CHAPEL, INC.
  CALIFORNIA
S.E. ACQUISITION OF CALIFORNIA, INC.
  CALIFORNIA
S.E. ACQUISITION OF DELANO, CALIFORNIA, INC.
  CALIFORNIA
S.E. ACQUISITION OF GLENDALE, CALIFORNIA, INC.
  CALIFORNIA
S.E. ACQUISITION OF LANCASTER, CALIFORNIA, INC.
  CALIFORNIA
S.E. ACQUISITION OF LOS OSOS MORTUARY AND MEMORIAL PARK, INC.
  CALIFORNIA
S.E. ACQUISITION OF OAKHURST, CALIFORNIA, INC.
  CALIFORNIA
S.E. ACQUISITION OF OROVILLE, CALIFORNIA, INC.
  CALIFORNIA
SAN DIEGO CEMETERY ASSOCIATION
  CALIFORNIA
SAN FERNANDO MISSION MORTUARY, INC.
  CALIFORNIA
SANTA BARBARA FUNERAL SERVICES, INC.
  CALIFORNIA
SANTA CLARA MORTUARY, INC.
  CALIFORNIA
SCOVERN MORTUARY, A CALIFORNIA CORPORATION
  CALIFORNIA
SDCA HOLDINGS, INC.
  CALIFORNIA
SIMPLICITY PLAN OF CALIFORNIA, INC.
  CALIFORNIA
STEWART PRE-NEED SERVICES, INC.
  CALIFORNIA
STRICKLIN/SNIVELY MORTUARY
  CALIFORNIA
VICTOR V. DESROSIER, INC.
  CALIFORNIA
WALLACE E. WHITE & HOWARD J. CALLANAN, INC.
  CALIFORNIA
SENTINEL CREMATION SOCIETIES, INC.
  DELAWARE
A.P. BOZA FUNERAL HOME, INC.
  FLORIDA
ALL FAITHS MEMORIAL PARK, INC.
  FLORIDA
ARLINGTON MEMORIAL PARK CEMETERY AND FUNERAL HOME, INC.
  FLORIDA
BALDWIN-FAIRCHILD FUNERAL HOMES, INC.
  FLORIDA
BAY AREA CREMATORY, INC.
  FLORIDA
BRUCE OCALA FUNERAL HOME, INC.
  FLORIDA
CEMETERY MANAGEMENT, INC.
  FLORIDA
CHAPEL HILL CEMETERY, INC.
  FLORIDA
CURRY & SON FUNERAL HOME, INC.
  FLORIDA
FLORIDA HILLS MEMORIAL GARDENS, INC.
  FLORIDA
GARDEN OF MEMORIES, INC.
  FLORIDA
GLEN HAVEN MEMORIAL PARK, INC.
  FLORIDA
GOOD SHEPHERD MEMORIAL GARDENS, INC.
  FLORIDA
HIGHLAND MEMORY GARDENS, INC.
  FLORIDA
HUBBELL FUNERAL HOME AND CREMATORY, INC.
  FLORIDA
KICLITER FUNERAL HOME, INC.
  FLORIDA
MADCEM OF FLORIDA, INC.
  FLORIDA
MEMORIAL PARK CEMETERY, INC.
  FLORIDA
MEMORIAL SUNSET PARK, INC.
  FLORIDA
OAKLAWN PARK CEMETERY AND FUNERAL HOME, INC.
  FLORIDA
ROBERTS FUNERAL HOME, INC.
  FLORIDA

Sched D -2

--------------------------------------------------------------------------------

 

          Jurisdiction of Subsidiary   Organization
ROYAL PALM MEMORIAL GARDENS, INC.
  FLORIDA
S.E. BD TAMPA, INC.
  FLORIDA
S.E. DCG TAMPA, INC.
  FLORIDA
SEMORAN FUNERAL HOME, INC.
  FLORIDA
SOUTH DADE-PALMS MEMORIAL PARK, INC.
  FLORIDA
SYLVAN ABBEY MEMORIAL PARK, INC.
  FLORIDA
THE SIMPLICITY PLAN, INC.
  FLORIDA
TURNER CREMATORY, INC.
  FLORIDA
TURNER FUNERAL HOMES, INC.
  FLORIDA
WALSH & WOOD FUNERAL HOME, INC.
  FLORIDA
WOODLAWN MEMORY GARDENS, INC.
  FLORIDA
WOODLAWN PARK CEMETERY COMPANY
  FLORIDA
CHEATHAM HILL MEMORIAL PARK, INC.
  GEORGIA
EASTLAWN CORPORATION
  GEORGIA
GARNER FAMILY FUNERAL HOME, INC.
  GEORGIA
HAISTEN FUNERAL HOME OF HENRY COUNTY, INC.
  GEORGIA
HAISTEN FUNERAL HOMES, INC.
  GEORGIA
HIGGINS AND SON FUNERAL HOME, INC.
  GEORGIA
HOLLY HILL MEMORIAL PARK, INC.
  GEORGIA
ROSE HAVEN FUNERAL HOME & CEMETERY, INC.
  GEORGIA
S.E. ACQUISITION OF LITHONIA, GEORGIA, INC.
  GEORGIA
S.E. FUNERAL HOMES OF ILLINOIS, INC.
  ILLINOIS
KNUTSON FUNERAL HOMES, INC.
  IOWA
PAULEY FUNERAL HOME, INC.
  IOWA
RUNYAN MANGOLD, INC.
  KANSAS
ACME MAUSOLEUM CORPORATION
  LOUISIANA
EMPRESAS STEWART — CEMENTERIOS, INC.
  LOUISIANA
EMPRESAS STEWART — FUNERARIAS, INC.
  LOUISIANA
ENDURING MEMORIES, INC.
  LOUISIANA
HEAVEN’S PETS AT LAKELAWN METAIRIE, LLC (JOINT VENTURE)
  LOUISIANA
LAKE LAWN METAIRIE FUNERAL HOME (JOINT VENTURE)
  LOUISIANA
LAKE LAWN PARK, INC.
  LOUISIANA
S.E. AUSTRALIA, INC.
  LOUISIANA
S.E. CEMETERIES OF LOUISIANA, INC.
  LOUISIANA
S.E. FUNERAL HOMES OF LOUISIANA, INC.
  LOUISIANA
S.E. SOUTH-CENTRAL, INC.
  LOUISIANA
STEWART ENTERPRISES (EUROPE) INC.
  LOUISIANA
STEWART RESOURCE CENTER, INC.
  LOUISIANA
STEWART SERVICES, INC.
  LOUISIANA
BOUNDS FUNERAL HOME, INC.
  MARYLAND
CEDAR HILL CEMETERY COMPANY, INC.
  MARYLAND
CREST LAWN MEMORIAL GARDENS, INC.
  MARYLAND

Sched D -3

--------------------------------------------------------------------------------

 

          Jurisdiction of Subsidiary   Organization
DRUID RIDGE CEMETERY COMPANY
  MARYLAND
FORT LINCOLN CEMETERY, INC.
  MARYLAND
FORT LINCOLN FUNERAL HOME, INC.
  MARYLAND
GALLERY GRANITE CORPORATION
  MARYLAND
HILLCREST MEMORIAL CEMETERY, INC.
  MARYLAND
HINES-RINALDI FUNERAL HOME, INC.
  MARYLAND
JOHN M. TAYLOR FUNERAL HOME, INC.
  MARYLAND
LOUDON PARK CEMETERY COMPANY
  MARYLAND
LOUDON PARK FUNERAL HOME, INC.
  MARYLAND
NATIONAL HARMONY MEMORIAL PARK, INC.
  MARYLAND
PARKLAWN, INC.
  MARYLAND
PARKWOOD MANAGEMENT COMPANY
  MARYLAND
S.E. MID-ATLANTIC, INC.
  MARYLAND
SIMPLE TRIBUTE OF MARYLAND, INC.
  MARYLAND
THE PARKWOOD CEMETERY COMPANY
  MARYLAND
WILLIAM W. CHAMBERS, INC.
  MARYLAND
LAKEWOOD MEMORIAL PARK, INC.
  MISSISSIPPI
D.W. NEWCOMER’S SONS, INC.
  MISSOURI
DWN PROPERTIES, INC.
  MISSOURI
FUNERAL SECURITY PLANS, INC.
  MISSOURI
THE LINCOLN MEMORIAL PARK CEMETERY ASSOCIATION
  NEBRASKA
WEST LAWN CEMETERY
  NEBRASKA
STEWART CEMENTERIOS PUERTO RICO HOLDING I B.V.
  NETHERLANDS
STEWART CEMENTERIOS PUERTO RICO HOLDING II B.V.
  NETHERLANDS
STEWART FUNERARIAS PUERTO RICO HOLDING I B.V.
  NETHERLANDS
STEWART FUNERARIAS PUERTO RICO HOLDING II B.V.
  NETHERLANDS
STEWART INTERNATIONAL (NETHERLANDS) B.V.
  NETHERLANDS
STEWART SIMPLICITY PLAN OF PUERTO RICO HOLDING I B.V.
  NETHERLANDS
STEWART SIMPLICITY PLAN OF PUERTO RICO HOLDING II B.V.
  NETHERLANDS
STEWART WORLDWIDE N.V.
  NETHERLANDS ANTILLES
RENO MEMORIAL, INC.
  NEVADA
S.E. ACQUISITION OF NEVADA, INC.
  NEVADA
S.E. ACQUISITION OF RENO, NEVADA, INC.
  NEVADA
S.E.N.S. OF NEVADA, INC.
  NEVADA
GORNY & GORNY PATERSON-CLIFTON MORTUARY
  NEW JERSEY
S.E. ACQUISITION OF CLIFTON, NEW JERSEY, INC.
  NEW JERSEY
S.E. ACQUISITION OF SANTA FE, NEW MEXICO, INC.
  NEW MEXICO
C.J. APPLEGATE AND SONS, INC.
  NEW YORK
CORNELL & DAGGETT, INC.
  NEW YORK

Sched D -4

--------------------------------------------------------------------------------

 

          Jurisdiction of Subsidiary   Organization
GARDINIER COLLETTI MEMORIAL HOME, INC.
  NEW YORK
MURPHY FUNERAL SERVICE, INC.
  NEW YORK
OTTO REDANZ FUNERAL HOME, INC.
  NEW YORK
S.E. ACQUISITION OF FREDONIA, NEW YORK, INC.
  NEW YORK
STRONG & BURNS FUNERAL HOME, INC.
  NEW YORK
CATAWBA MEMORIAL PARK, INC.
  NORTH CAROLINA
EVANS FUNERAL HOME, INC.
  NORTH CAROLINA
FINE FINISHES, INC.
  NORTH CAROLINA
GARRETT — HILLCREST, INC.
  NORTH CAROLINA
MCLAURIN’S FUNERAL HOME, INC.
  NORTH CAROLINA
MONTLAWN MEMORIAL PARK, INC.
  NORTH CAROLINA
S.E. CEMETERIES OF NORTH CAROLINA, INC.
  NORTH CAROLINA
S.E. FUNERAL HOMES OF NORTH CAROLINA, INC.
  NORTH CAROLINA
TAYLOR M. SIMPSON CO.
  NORTH CAROLINA
AMLING SCHROEDER FUNERAL SERVICE, INC.
  OREGON
CASCADE CREMATORY, INC.
  OREGON
CHAPEL OF THE ROSES, INC.
  OREGON
CHAPEL OF THE VALLEY FUNERAL HOME, INC.
  OREGON
DUTTON, INC.
  OREGON
J.P. FINLEY AND SON MORTUARY, INC.
  OREGON
S.E. ACQUISITION OF MYRTLE CREEK, OREGON, INC.
  OREGON
S.E. ACQUISITION OF OREGON, INC.
  OREGON
S.E. ACQUISITION OF REEDSPORT, OREGON, INC.
  OREGON
S.E. BEND NR, INC.
  OREGON
S.E. BEND TDHM, INC.
  OREGON
S.E. GREENWOOD, INC.
  OREGON
SUNSET HILLS MEMORIAL PARK
  OREGON
BENJAMIN FRANKLIN P. M., INC.
  PENNSYLVANIA
GEORGE WASHINGTON MEMORIAL PARK, INC.
  PENNSYLVANIA
KIRK & NICE SUBURBAN CHAPEL, INC.
  PENNSYLVANIA
KIRK & NICE, INC.
  PENNSYLVANIA
PET HAVEN, INC.
  PENNSYLVANIA
S.E. ACQUISITION OF PENNSYLVANIA, INC.
  PENNSYLVANIA
SUNSET MEMORIAL PARK COMPANY
  PENNSYLVANIA
EMPRESAS STEWART — CEMENTERIOS
  PUERTO RICO
EMPRESAS STEWART — FUNERARIAS
  PUERTO RICO
THE SIMPLICITY PLAN OF PUERTO RICO
  PUERTO RICO
DUNBAR FUNERAL HOME
  SOUTH CAROLINA
S.E. CEMETERIES OF SOUTH CAROLINA, INC.
  SOUTH CAROLINA
S.E. COMBINED SERVICES OF SOUTH CAROLINA, INC.
  SOUTH CAROLINA
S.E. FUNERAL HOMES OF SOUTH CAROLINA, INC.
  SOUTH CAROLINA
MONTE VISTA BURIAL PARK, INC.
  TENNESSEE
MT. JULIET MEMORIAL GARDENS, INC.
  TENNESSEE

Sched D -5

--------------------------------------------------------------------------------

 

          Jurisdiction of Subsidiary   Organization
NAVE FUNERAL HOME OF LEBANON, INC.
  TENNESSEE
S.E. COMBINED SERVICES OF TENNESSEE, INC.
  TENNESSEE
S.E. FUNERAL HOMES OF TENNESSEE, INC.
  TENNESSEE
THE NASHVILLE HISTORIC CEMETERY ASSOCIATION, INC.
  TENNESSEE
ABBEY PLAN OF TEXAS, INC.
  TEXAS
BELEW FUNERAL HOME, INC.
  TEXAS
EMERALD HILLS FUNERAL CORPORATION
  TEXAS
GUARDIAN CREMATION SOCIETY, INC.
  TEXAS
INVESTORS TRUST, INC.
  TEXAS
LYONS FUNERAL HOME, INC.
  TEXAS
PASADENA FUNERAL HOME, INC.
  TEXAS
S.E. CEMETERIES OF TEXAS, INC.
  TEXAS
S.E. FUNERAL HOMES OF TEXAS, INC.
  TEXAS
SIMPLICITY PLAN OF TEXAS, INC.
  TEXAS
CLINCH VALLEY MEMORIAL CEMETERY, INC.
  VIRGINIA
EVERLY FUNERAL HOMES, INCORPORATED
  VIRGINIA
EVERLY PFP, INC.
  VIRGINIA
MONTICELLO MEMORY GARDENS, INC.
  VIRGINIA
S.E. CEMETERIES OF VIRGINIA, INC.
  VIRGINIA
S.E. FUNERAL HOMES OF VIRGINIA, INC.
  VIRGINIA
CREMATION SOCIETY NORTHWEST, INC.
  WASHINGTON
E.R. BUTTERWORTH & SONS
  WASHINGTON
S.E. ACQUISITION OF WASHINGTON, INC.
  WASHINGTON
S.E.E.S. OF VANCOUVER, INC.
  WASHINGTON
BARTLETT-BURDETTE-COX FUNERAL HOME, INC.
  WEST VIRGINIA
CASDORPH & CURRY FUNERAL HOME, INC.
  WEST VIRGINIA
EASTERN CEMETERY ASSOCIATES, INC.
  WEST VIRGINIA
KANAWHA PLAZA PARTNERSHIP
  WEST VIRGINIA
KLINGEL-CARPENTER MORTUARY, INC.
  WEST VIRGINIA
LOI CHARLESTON, INC.
  WEST VIRGINIA
NATIONAL EXCHANGE TRUST, LTD.
  WEST VIRGINIA
NATIONAL FUNERAL SERVICES, INCORPORATED
  WEST VIRGINIA
S.E. ACQUISITION OF MALDEN, WEST VIRGINIA, INC.
  WEST VIRGINIA
S.E. CEMETERIES OF WEST VIRGINIA, INC.
  WEST VIRGINIA
S.E. FUNERAL HOMES OF WEST VIRGINIA, INC.
  WEST VIRGINIA
WILSON FUNERAL HOME, INC.
  WEST VIRGINIA
S.E. CEMETERIES OF WISCONSIN, INC.
  WISCONSIN

Sched D -6

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PART II- NON-WHOLLY OWNED SUBSIDIARIES

      Company   State of Organization
1. Lake Lawn Park, Inc.
  Louisiana
 
   
2. Rest Hills Memorial Park, Inc.
  Arkansas
 
   
3. Heaven’s Pets at Lakelawn Metairie, LLC
  Louisiana

PART III- SUBSIDIARY STOCK SUBJECT TO LIENS, ETC.
A. The following subsidiaries’ outstanding capital stock is subject to a
security interest, mortgage, pledge, lien, encumbrance or claim under that
certain Amended and Restated Credit Agreement, among the Company, Empresas
Stewart-Cementerios, and Empresas Stewart-Funerarias, as Borrow, Bank of
America, N.A., as Administrative Agent, Collateral Agent, Swing Line Lender and
L/C Issuer, Suntrust Bank, as Syndication Agent, Calyon New York Branch, as
Documentation Agent and the other lenders party thereto, dated as of
November 19, 2004 (the “Senior Secured Credit Facility”):
      1.

      Significant Subsidiaries   State of Incorporation
Woodlawn Park Cemetery Co., Inc.
  Florida
S.E. Funeral Homes of Texas, Inc.
  Texas
S.E. Cemeteries of Texas, Inc.
  Texas
D.W. Newcomer’s Sons, Inc.
  Missouri
S.E. South-Central, Inc.
  Louisiana
S.E. Mid-Atlantic, Inc.
  Maryland

     2. All other domestic subsidiaries of the Company (except as set forth in
Sections B, C and D below) and 65% of the voting securities of Stewart Worldwide
N.V.
B. The following subsidiaries’ outstanding capital stock is subject to a
security interest, mortgage, pledge, lien encumbrance of claim under the Senior
Secured Credit Facility and as follows:
     1. Subsidiary with a prior lien in connection with Seller Financed
Indebtedness:
          Lombard & Co. (Deed of Trust)
C. The following Subsidiaries’ outstanding capital stock is subject to a
security interest, mortgage, pledge, lien, encumbrance or claim as follows:

Sched D -7

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     1. Subsidiaries Encumbered by a Previous Stock Pledge:
          Simple Tribute of Maryland, Inc.
D. The following subsidiaries’ outstanding capital stock is subject to a
security interest, mortgage, pledge, lien, encumbrance or claim under the Senior
Secured Credit Facility but certain minority ownership cannot be pledged:

  1.   Non-wholly owned subsidiaries:         Lake Lawn Park, Inc. (1.6%
minority ownership; 98.4% pledged)         Rest Hills Memorial Park, Inc. (.5%
minority ownership; 95.5% pledged)         Heaven’s Pets at Lakelawn Metairie,
LLC (40% minority ownership; 60% pledged)

PART IV- LIST OF SIGNIFICANT SUBSIDIARIES

         
 
  Woodlawn Park Cemetery Co., Inc.   FL
 
       
 
  S.E. Funeral Homes of Texas, Inc.   TX
 
       
 
  S.E. Cemeteries of Texas, Inc.   TX
 
       
 
  D.W. Newcomer’s Sons, Inc.   MO
 
       
 
  S.E. South-Central, Inc.   LA
 
       
 
  S.E. Mid-Atlantic, Inc.   MD

Sched D -8

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SCHEDULE E
EXCLUDED DOMESTIC SUBSIDIARIES

      Company   State of Organization
1. Investor’s Trust, Inc.
  Texas
 
   
2. West Lawn Cemetery
  Nebraska
 
   
3. Lake Lawn Park, Inc.
  Louisiana
 
   
4. Rest Hills Memorial Park, Inc.
  Arkansas
 
   
5. Heaven’s Pets at Lakelawn Metairie, LLC
  Louisiana
 
   
6. Fine Finishes, Inc.
  North Carolina
 
   
7. Taylor M. Simpson Co.
  North Carolina

Sched E -1

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SCHEDULE F
LOCAL COUNSEL OF GUARANTORS

          LOCAL COUNSEL   STATE   SUBSIDIARIES
SHEPPARD MULLIN RICHTER & HAMPTON, LLP
FOUR EMBARCADERO CENTER, 17TH FLOOR
SAN FRANCISCO, CA 94111-4106
PH: (415) 774-2942
FAX: (415) 434-3947
(CA Main Opinion)
  California   All Souls Mortuary, Inc.
Barstow Funeral Homes, Inc.
Buchheim Family, Inc.
Calvary Mortuary of Los Angeles, California, Inc.
DeYoung Memorial Chapel, Inc.
Dilday Brothers Huntington Valley Mortuary
Holy Cross Mortuary of Culver City, California, Inc.
Lassila Funeral Chapels, Inc.
Lombard & Co.
N.D. Davis & Associates, Inc.
Queen of Heaven Mortuary, Inc.
River Cities Funeral Chapel, Inc.
S.E. Acquisition of Glendale, California, Inc.
S.E. Acquisition of Lancaster, California, Inc.
S.E. Acquisition of Los Osos Mortuary and Memorial
San Diego Cemetery Association
San Fernando Mission Mortuary, Inc.
Simplicity Plan of California, Inc.
Stricklin/Snively Mortuary
Victor V. Desrosier, Inc.
Wallace E. White & Howard J. Callanan, Inc.
 
       
LAW OFFICES OF DOUGLAS O. MEYER
5550 TOPANGA CANYON BOULEVARD
SUITE 200
WOODLAND HILLS, CA 91367
PH: (818) 703-7969
FAX: (818) 888-2904
(CA Regulatory Opinion)
  California   All Souls Mortuary, Inc.
Barstow Funeral Homes, Inc.
Buchheim Family, Inc.
Calvary Mortuary of Los Angeles, California, Inc.
DeYoung Memorial Chapel, Inc.
Dilday Brothers Huntington Valley Mortuary
Holy Cross Mortuary of Culver City, California, Inc.
Lassila Funeral Chapels, Inc.
Lombard & Co.
N.D. Davis & Associates, Inc.
Queen of Heaven Mortuary, Inc.
River Cities Funeral Chapel, Inc.
S.E. Acquisition of Glendale, California, Inc.
S.E. Acquisition of Lancaster, California, Inc.
S.E. Acquisition of Los Osos Mortuary and Memorial
San Diego Cemetery Association
San Fernando Mission Mortuary, Inc.
Simplicity Plan of California, Inc.
Stricklin/Snively Mortuary
Victor V. Desrosier, Inc.
Wallace E. White & Howard J. Callanan, Inc.

Sched F -1

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          LOCAL COUNSEL   STATE   SUBSIDIARIES
GRAY-ROBINSON, P.A.
301 EAST PINE ST., SUITE 1400
ORLANDO, FL 32801
PH: (407) 843-8880
FAX: (407) 244-5690
  Florida   A.P. Boza Funeral Home, Inc.
All Faiths Memorial Park, Inc.
Arlington Memorial Park Cemetery and Funeral Home, Inc.
Baldwin-Fairchild Funeral Homes, Inc.
Bruce Ocala Funeral Home, Inc.
Chapel Hill Cemetery, Inc.
Curry & Son Funeral Home, Inc.
Florida Hills Memorial Gardens, Inc.
Garden of Memories, Inc.
Glen Haven Memorial Park, Inc.
Good Shepherd Memorial Gardens, Inc.
Highland Memory Gardens, Inc.
Madcem of Florida, Inc.
Memorial Park Cemetery, Inc.
Memorial Sunset Park, Inc.
Oaklawn Park Cemetery and Funeral Home, Inc.
Roberts Funeral Home, Inc.
Royal Palm Memorial Gardens, Inc.
Semoran Funeral Home, Inc.
South Dade-Palms Memorial Park, Inc.
Sylvan Abbey Memorial Park, Inc.
Turner Funeral Homes, Inc.
Woodlawn Memory Gardens, Inc.
Woodlawn Park Cemetery Company
 
       
JONES, WALKER, WAECHTER, POITEVENT, CARRERE
& DENEGRE L.L.P.
201 ST. CHARLES AVENUE
NEW ORLEANS, LA 70170
PH: (504) 582-8462
FAX: (504) 582-8583
  Louisiana   Acme Mausoleum Corporation
S.E. Cemeteries of Louisiana, Inc.
S.E. South-Central, Inc.
S.E. Funeral Homes of Louisiana, Inc.
 
       
CROUCH & RAMEY, LLP
FOUNTAIN PLACE
1445 ROSS AVE – SUITE 2300
DALLAS TX 75202
PH: (214) 922-7100 direct: (214) 922-7115
FAX: (214) 922-7101
  Texas   Emerald Hills Funeral Corporation
Pasadena Funeral Home, Inc.
S.E. Cemeteries of Texas, Inc.
S.E. Funeral Homes of Texas, Inc.
 
       
OBER KALER GRIMES & SHRIVER
120 EAST BALTIMORE STREET
BALTIMORE, MD 21202-1643
PH: (800) 638-6547
PH: (410) 347-7394
FAX: (410) 263-7594
  Maryland   Bounds Funeral Home, Inc.
Cedar Hill Cemetery Company, Inc.
Crest Lawn Memorial Gardens, Inc.
Druid Ridge Cemetery Company
Fort Lincoln Cemetery, Inc.
Fort Lincoln Funeral Home, Inc.
Hillcrest Memorial Cemetery, Inc.
Hines-Rinaldi Funeral Home, Inc.
John M. Taylor Funeral Home, Inc.
Loudon Park Cemetery Company
Loudon Park Funeral Home, Inc.
National Harmony Memorial Park, Inc.
Parklawn, Inc.
S.E. Mid-Atlantic, Inc.
The Parkwood Cemetery Company

Sched F -2

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          LOCAL COUNSEL   STATE   SUBSIDIARIES
BLACKWELL SANDERS PEPER MARTIN
2300 MAIN STREET, SUITE 1100
KANSAS CITY, MO 64108
PH: (816) 983-8145 (DIRECT)
PH: (816) 983-8000
FAX: (816) 983-8080
OR
13710 FNB PARKWAY, SUITE 200
P.O. BOX 542090
OMAHA, NE 68154-8090
PH: (402) 964-5000
FAX: (402) 964-5050
  Missouri   D.W. Newcomer’s Sons, Inc.

Sched F -3

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SCHEDULE G
LIST OF PERSONS SUBJECT TO LOCK-UP
1. Frank B. Stewart, Jr.- Chairman of the Board
2. Alden J. McDonald, Jr.- Director
3. James W. McFarland- Director
4. Ronald H. Patron- Director
5. Michael O. Read- Director
6. Ashton J. Ryan, Jr.- Director
7. Thomas J. Crawford- President, Chief Executive Officer and Director
8. Thomas M. Kitchen- Senior Executive Vice President, Chief Financial Officer
and Director
9. Brent F. Heffron- Executive Vice President and President- Eastern Division
10. G. Kenneth Stephens, Jr.- Executive Vice President and President- Western
Division
11. Lawrence B. Hawkins- Executive Vice President and President- Investors
Trust, Inc.
12. Randall L. Stricklin- Senior Vice President and President- Corporate
Development
13. Kenneth G. Myers, Jr.- Senior Vice President of Finance
14. Lisa T. Winningkoff- Vice President and Senior Administrative Officer
15. Lewis J. Derbes, Jr.- Vice President, Secretary and Treasurer
16. Angela M. Lacour- Vice President, Corporate Controller and Chief Accounting
Officer

Sched G -1

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EXHIBIT A
REGISTRATION RIGHTS AGREEMENT

Ex A -1

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EXHIBIT B
FORM OF OPINION OF COUNSEL FOR THE COMPANY
          Opinion of counsel for the Company to be delivered pursuant to
Section 5 of the Purchase Agreement.
          (i) The Company has been duly incorporated and is validly existing as
a corporation in good standing under the laws of the State of Louisiana. Each
Subsidiary of the Company incorporated or formed in Louisiana (the “Louisiana
Subsidiaries”) has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the State of Louisiana.
          (ii) Each of the Company and the Louisiana Subsidiaries listed in
Schedule F (the “Louisiana Material Jurisdiction Guarantors”) has the corporate
power and authority to own, lease and operate its properties and to conduct its
business as described in the Disclosure Package and the Final Offering
Memorandum and to enter into and perform its obligations under the Purchase
Agreement, the Registration Rights Agreement, the Indentures, the Securities and
the DTC Letter of Representations to the extent each is a party thereto.
          (iii) To such counsel’s best knowledge and following due inquiry of
appropriate representatives of the Company, each of the Company and the
Louisiana Material Jurisdiction Guarantors is duly qualified as a foreign
corporation to transact business and is in good standing in each other
jurisdiction in which such qualification is required, whether by reason of the
ownership or leasing of property or the conduct of business, except for such
jurisdictions where the failure to so qualify or to be in good standing would
not, individually or in the aggregate, result in a Material Adverse Change.
          (iv) Each domestic Significant Subsidiary has been duly incorporated
and is validly existing as a corporation in good standing under the laws of the
jurisdiction of its incorporation, has corporate power and authority to own,
lease and operate its properties and to conduct its business as described in the
Disclosure Package and the Final Offering Memorandum and, to our best knowledge
and following due inquiry of appropriate representatives of the Company, is duly
qualified as a foreign corporation to transact business and is in good standing
in each jurisdiction in which such qualification is required, whether by reason
of the ownership or leasing of property or the conduct of business, except for
such jurisdictions where the failure to so qualify or to be in good standing
would not, individually or in the aggregate, result in a Material Adverse
Change.
          (v) Each of Empresas Stewart-Cementerios and Empresas
Stewart-Funerarias, foreign Subsidiaries of the Company, is a civil partnership
duly organized, and validly existing under the laws of Puerto Rico, has full
power and authority to own, lease and operate its properties and to conduct its
business as described in the Disclosure Package and the Final Offering
Memorandum, and, to our best knowledge following due inquiry of appropriate
representatives of the Company, is duly qualified as a foreign corporation to
transact business and is in good standing in each jurisdiction in which such

Ex B -1

--------------------------------------------------------------------------------

 

qualification is required, whether by reason of the ownership or leasing of
property or the conduct of business, except for such jurisdictions where the
failure to so qualify or to be in good standing would not, individually or in
the aggregate, result in a Material Adverse Change.
          (vi) All of the issued and outstanding capital stock of each
Significant Subsidiary has been duly authorized and validly issued, is fully
paid and non-assessable and is owned of record by the Company, directly or
through subsidiaries, and, to our best knowledge, free and clear of any security
interest, mortgage, pledge, lien, encumbrance or any pending or threatened claim
except as may be disclosed on Schedule D of the Purchase Agreement.
          (vii) All of the outstanding shares of Common Stock of the Company
have been duly authorized and validly issued, are fully paid and nonassessable
and, to the best of such counsel’s knowledge, have been issued in compliance
with the registration and qualification requirements of federal and state
securities laws.
          (viii) No stockholder of the Company or any other person has any
preemptive right, right of first refusal or other similar right to subscribe for
or purchase securities of the Company arising by operation of the charter or
by-laws of the Company or the Louisiana Business Corporation Law or, to the best
of such counsel’s knowledge and following due inquiry of appropriate
representatives of the Company, otherwise.
          (ix) Each of the Purchase Agreement and the Registration Rights
Agreement has been duly authorized, executed and delivered by the Company and
each Material Jurisdiction Guarantor (defined below).
          (x) Each of the Indentures has been duly authorized, executed and
delivered by the Company and each Material Jurisdiction Guarantor.
          (xi) The Notes have been duly authorized by the Company for issuance
and sale pursuant to the Purchase Agreement and the applicable Indenture.
          (xii) The Guarantees have been duly authorized by each Material
Jurisdiction Guarantor for issuance and sale pursuant to the Purchase Agreement
and the applicable Indenture.
          (xiii) The Common Stock issuable upon conversion of the Securities has
been duly authorized for issuance by all necessary corporate action on the part
of the Company and, when issued and delivered upon conversion of the Securities
in accordance with the provisions of the applicable Indenture and the
Securities, will be validly issued, fully paid and nonassessable.
          (xiv) The documents incorporated by reference in the Disclosure
Package and the Final Offering Memorandum (other than the financial statements
and supporting schedules therein, as to which no opinion need be rendered), when
they were filed with the Commission, complied as to form in all material
respects with the requirements of the Exchange Act.

Ex B -2

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          (xv) The statements in the Disclosure Package and the Final Offering
Memorandum under the captions “Risk Factors” (other than the two risk factors
relating to taxation of the Notes and the risk factor relating to convertible
note hedge and warrant transactions, each under the heading “Risk Factors- Risks
Related to the Notes”) and “Description of Capital Stock,” insofar as such
statements constitute matters of law, summaries of legal matters, the Company’s
charter or by-law provisions, documents or legal proceedings, or legal
conclusions, have been reviewed by us and fairly present and summarize, in all
material respects, the matters referred to therein. The Registration Rights
Agreement conforms in all material respects to the descriptions thereof
contained in the Disclosure Package and the Final Offering Memorandum.
          (xvi) No consent, approval, authorization or other order of, or
registration or filing with, any court or other governmental or regulatory
authority or agency, is required for the Company’s execution, delivery and
performance of the Purchase Agreement, the Registration Rights Agreement, the
DTC Letter of Representations, the Indentures and the documentation relating to
the convertible note hedge and warrant transactions described in the Disclosure
Package and the Final Offering Memorandum (the “Convertible Note Hedge and
Warrant Confirmations”), the issuance and delivery of the Securities or the
issuance and delivery of shares of Common Stock upon conversion of the
Securities, or consummation of the transactions contemplated thereby and by the
Disclosure Package and the Final Offering Memorandum, except such as have been
obtained or made by the Company and are in full force and effect under the
Securities Act, applicable state securities or blue sky laws and except such as
may be required by federal and state securities laws with respect to the
Company’s obligations under the Registration Rights Agreement.
          (xvii) No consent, approval, authorization or other order of, or
registration or filing with, any court or other governmental or regulatory
authority or agency, is required for any Louisiana Material Jurisdiction
Guarantor’s execution, delivery and performance of the Purchase Agreement, the
Indentures or the Guarantees under any laws, rules or regulations of the State
of Louisiana generally applicable to (x) the operations of each Louisiana
Material Jurisdiction Guarantor in the State of Louisiana relating to the
operation of funeral homes, cemeteries and crematoria and the provision of
related goods and services (the “Operations”), or (y) transactions of the type
contemplated by the Guarantee entered into by each Louisiana Material
Jurisdiction Guarantor, except such as have been obtained or made by each
Louisiana Material Jurisdiction Guarantor and are in full force and effect.
          (xviii) The execution and delivery of the Purchase Agreement, the
Registration Rights Agreement, the DTC Letter of Representations, the
Securities, the Indentures and the Convertible Note Hedge and Warrant
Confirmations by the Company and the performance by the Company of its
obligations thereunder (other than performance by the Company of its obligations
under the indemnification sections of the Purchase Agreement and the
Registration Rights Agreement, as to which no opinion need be rendered) (i) have
been duly authorized by all necessary corporate action on the part of the
Company; (ii) will not result in any violation of the provisions of the charter
or by-laws of the Company; (iii) assuming the application of proceeds as
described in “Use of

Ex B -3

--------------------------------------------------------------------------------

 

Proceeds” in the Disclosure Package and the Final Offering Memorandum, will not
constitute a breach of, or Default or a Debt Repayment Triggering Event under,
or result in the creation or imposition of any lien, charge or encumbrance upon
any property or assets of the Company or any of its subsidiaries pursuant to the
Company’s senior secured credit facility, or to our best knowledge, any other
material Existing Instrument; or (iv) to our best knowledge, will not result in
any violation of any law, administrative regulation or administrative or court
decree applicable to the Company.
          (xix) The execution and delivery of the Purchase Agreement, the
Indentures, the Registration Rights Agreement and the Guarantees (collectively,
the “Guarantor Transaction Documents”) and the performance by each Louisiana
Subsidiary of its obligations thereunder (i) have been duly authorized by all
necessary corporate action on the part of each Louisiana Material Jurisdiction
Guarantor; (ii) will not result in any violation of the provisions of the
charter or by-laws of any Louisiana Material Jurisdiction Guarantor; (iii) will
not result in the creation or imposition of any lien, charge or encumbrance upon
any property or assets of any Louisiana Material Jurisdiction Guarantor under,
and, to the best knowledge of such counsel, will not result in any violation of,
in each case, any laws, rules or regulations of the State of Louisiana generally
applicable to (x) the Operations or (y) transactions of the type contemplated by
the Guarantor Transaction Documents.
          (xx) The Company is not, and after the issuance of the Securities and
application of the net proceeds therefrom as described in the Disclosure Package
and the Final Offering Memorandum will not be, an “investment company” within
the meaning of the Investment Company Act.
          (xxi) To our best knowledge and following due inquiry of appropriate
representatives of the Company, the Company is not in violation of its charter
or by-laws or any law, administrative regulation or administrative or court
decree applicable to the Company nor is the Company in Default in the
performance or observance of any obligation, agreement, covenant or condition
contained in any material Existing Instrument known to us, except in each such
case for such violations or Defaults as would not, individually or in the
aggregate, result in a Material Adverse Change.
          (xxii) Assuming the accuracy of the representations, warranties and
covenants of the Company and the Initial Purchasers contained in the Purchase
Agreement, no registration of the Notes, the Guarantees or the Common Stock
issuable upon conversion of the Securities under the Securities Act, and no
qualification of the Indentures under the Trust Indenture Act with respect
thereto, is required in connection with the purchase of the Securities by the
Initial Purchasers or the initial resale of the Securities by the Initial
Purchasers to Qualified Institutional Buyers pursuant to Rule 144A under the
Securities Act of 1933 in the manner contemplated by the Purchase Agreement, the
Disclosure Package and the Final Offering Memorandum. Such counsel need express
no opinion, however, as to when or under what circumstances any Securities
initially sold by the Initial Purchasers may be reoffered or resold.

Ex B -4

--------------------------------------------------------------------------------

 

     In addition, such counsel shall state that they have participated in
conferences with officers and other representatives of the Company,
representatives of the independent public or certified public accountants for
the Company and with representatives of the Initial Purchasers at which the
contents of the Disclosure Package and the Final Offering Memorandum, and any
supplements or amendments thereto, and related matters were discussed and,
although such counsel is not passing upon and does not assume any responsibility
for, and has not made any independent verification of, the accuracy,
completeness or fairness of the statements contained in the Disclosure Package
and the Final Offering Memorandum (other than as specified above), and any
supplements or amendments thereto, on the basis of the foregoing, nothing has
come to their attention that would lead them to believe that the Disclosure
Package, as of the Applicable Time, included an untrue statement of a material
fact or omitted or omits to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading, or that the Final Offering Memorandum, as of its date or
as of the Closing Date, included or includes an untrue statement of a material
fact or omitted or omits to state a material fact necessary in order to make the
statements therein, in light of the circumstances under which they were made,
not misleading (it being understood that such counsel need express no statement
as to the financial statements or other financial data derived therefrom,
included or incorporated by reference in the Disclosure Package and the Final
Offering Memorandum or any amendments or supplements thereto).
     In rendering such opinion, such counsel may rely as to matters involving
the application of laws of any jurisdiction other than the laws of the State of
Louisiana or the federal law of the United States, to the extent they deem
proper and specified in such opinion, upon the opinion (which shall be dated the
Closing Date, shall be satisfactory in form and substance to the Initial
Purchasers, shall expressly state that the Initial Purchasers may rely on such
opinion as if it were addressed to them and shall be furnished to the Initial
Purchasers) of other counsel of good standing whom they believe to be reliable
and who are satisfactory to counsel for the Initial Purchasers; provided,
however, that such counsel shall further state that they believe that they and
the Initial Purchasers are justified in relying upon such opinion of other
counsel, and as to matters of fact, to the extent they deem proper, on
certificates of responsible officers of the Company and public officials.
     Specifically, and not by way of limitation, such counsel may state that as
to the matters addressed therein pertaining to the laws of the respective
jurisdictions addressed therein, such counsel has relied upon the opinions of
special local counsel, given pursuant to Section 5(d) of the Purchase Agreement,
in the jurisdictions and with respect to the Guarantors listed on Schedule F
(Local Counsel for the Guarantors) (together with each Significant Subsidiary,
the “Material Jurisdiction Guarantors”).
     Such counsel may also state that whenever such counsel’s opinion is given
with respect to the existence or absence of facts (or legal conclusions which
necessarily are based upon the existence or absence of facts) and is indicated
to be based on such counsel’s knowledge, it is intended to signify that, during
the course of such counsel’s representation of the Company in connection with
the offering of the Notes, no information has come to the conscious awareness of
any attorney in such counsel’s firm who has had active involvement with such
representations that would give any such person actual knowledge of the
existence or absence of such facts, and that except to the extent expressly set
forth, such counsel has not undertaken any independent

Ex B -5

--------------------------------------------------------------------------------

 

investigation to determine or verify the existence or absence of facts, and no
inference as to such counsel’s knowledge or the existence or absence of such
facts should be drawn from its representation of the Company.

Ex B -6

--------------------------------------------------------------------------------

 

EXHIBIT C
FORM OF OPINION OF LOCAL COUNSEL FOR THE GUARANTOR
          Opinion of counsel for the Guarantor to be delivered pursuant to
Section 5 of the Purchase Agreement.
          (i) The Guarantor is a [corporation] [limited liability company]
[limited partnership] and is validly existing as a [corporation] [limited
liability company] [limited partnership] in good standing under the laws of the
state of [___] (the “State”).
          (ii) The Guarantor has full [corporate] power and authority to own,
lease and operate its properties and to conduct its business as described in the
Disclosure Package and the Final Offering Memorandum and to enter into and
perform its obligations under the Indentures, the Purchase Agreement, the
Registration Rights Agreement and the documents evidencing the Guarantee entered
into by the Guarantor (collectively, the “Guarantor Transaction Documents”).
          (iii) Each of the Guarantor Transaction Documents has been duly
authorized by the Guarantor.
          (iv) The Guarantees entered into by the Guarantor have been duly
authorized for issuance and sale pursuant to the Purchase Agreement and the
Indentures.
          (v) No consent, approval, authorization or other order of, or
registration or filing with, any court or other governmental or regulatory
authority or agency, is required for the Guarantor’s execution, delivery and
performance of any of the Guarantor Transaction Documents under any laws, rules
or regulations of the State generally applicable to (x) the operations of the
Guarantor in the State relating to the operation of funeral homes, cemeteries
and crematoria and the provision of related goods and services (the
“Operations”) or (y) transactions of the type contemplated by the Guarantee
entered into by the Guarantor, except such as have been obtained or made by the
Guarantor and are in full force and effect.
          (vi) The execution and delivery of each of the Guarantor Transaction
Documents and the performance by the Guarantor of its obligations thereunder
(i) have been duly authorized by all necessary [corporate] action on the part of
the Guarantor; (ii) will not result in any violation of the provisions of the
charter or by-laws of the Guarantor; (iii) will not result in the creation or
imposition of any lien, charge or encumbrance upon any property or assets of the
Guarantor under, and, to the best knowledge of such counsel, will not result in
any violation of, in each case, any laws, rules or regulations of the State
generally applicable to (x) the Operations or (y) transactions of the type
contemplated by the Guarantor Transaction Documents.
     Counsel may state that its opinion does not address federal or state
securities laws.

Ex C -1

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EXHIBIT D
FORM OF OPINION OF SPECIAL COUNSEL FOR THE COMPANY
          (i) Each of the Indentures, assuming the due authorization, execution
and delivery thereof by the Company, the Guarantors and the Trustee thereunder,
constitutes a valid and binding agreement of the Company and each of the
Guarantors, enforceable against the Company and each of the Guarantors in
accordance with its terms, except as the enforcement thereof may be limited by
bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance or
other similar laws relating to or affecting the rights and remedies of creditors
or by general principles of equity.
          (ii) When executed by the Company (assuming due authorization thereof
by the Company) and authenticated by the Trustee in the manner provided in the
applicable Indenture and delivered against payment of the purchase price
therefor, the Notes will constitute valid and binding obligations of the
Company, enforceable against the Company in accordance with their terms, except
as the enforcement thereof may be limited by bankruptcy, insolvency,
reorganization, moratorium, fraudulent conveyance or similar laws relating to or
affecting enforcement of the rights and remedies of creditors or by general
principles of equity and will be entitled to the benefits of the applicable
Indenture.
          (iii) When the Notes have been authenticated in the manner provided
for in the applicable Indenture and delivered against payment of the purchase
price therefor (assuming the Guarantees have been duly authorized, executed and
delivered by the Guarantors) the Guarantees will constitute valid and binding
agreements of the Guarantors, enforceable in accordance with their terms, except
as the enforcement thereof may be limited by bankruptcy, insolvency,
reorganization, moratorium, fraudulent conveyance or other similar laws relating
to or affecting the rights and remedies of creditors or by general equitable
principles and will be entitled to the benefits of the applicable Indenture.
          (iv) The Securities and the Indentures conform in all material
respects to the descriptions thereof contained in the Disclosure Package and the
Final Offering Memorandum.
          (v) The statements in the Disclosure Package and the Final Offering
Memorandum under the captions “Material U.S. Federal Income Tax Considerations,”
“Purchase of Convertible Note Hedge and Sale of Warrant Transactions,” “Transfer
Restrictions” and in the two risk factors relating to taxation of the Notes and
the risk factor relating to the convertible note hedge and warrant transactions,
each under the heading “Risk Factors- Risks Related to the Notes,” insofar as
such statements constitute matters of law, summaries of legal matters, documents
or legal proceedings, or legal conclusions, have been reviewed by us and fairly
present and summarize, in all material respects, the matters referred to
therein.

Ex D -1

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EXHIBIT E
FORM OF LOCK-UP AGREEMENT
MERRILL LYNCH & CO.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
c/o Merrill Lynch, Pierce, Fenner & Smith
Incorporated
4 World Financial Center
New York, New York 10080

      RE:   Proposed Offering by Stewart Enterprises, Inc.

Dear Sirs:
     The undersigned, an executive officer and/or director of Stewart
Enterprises, Inc., a Louisiana corporation (the “Company”), understands that
Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated
(“Merrill Lynch”) and certain other co-managers, for whom Merrill Lynch is
acting as representative, propose to enter into a Purchase Agreement (the
“Purchase Agreement”) with the Company, providing for the offering (the
“Offering”), pursuant to Rule 144A under the Securities Act of 1933, as amended
(the “Securities Act”), of Senior Convertible Notes due 2014 and Senior
Convertible Notes due 2016 of the Company. Capitalized terms used herein and not
otherwise defined shall have the meanings set forth in the Purchase Agreement.
     In recognition of the benefit that the Offering will confer upon the
undersigned as an officer and/or director of the Company, and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the undersigned hereby agrees with Merrill Lynch and Banc of
America Securities LLC (“Banc of America”) that, during a period of 90 days from
the date of the Purchase Agreement, the undersigned will not, without the prior
written consent of Merrill Lynch and Banc of America, directly or indirectly,
(i) offer, pledge, sell, contract to sell, sell any option or contract to
purchase, purchase any option or contract to sell, grant any option, right or
warrant for the sale of, or lend or otherwise dispose of or transfer any shares
of the Class A common stock, no par value, of the Company (the “Common Stock”)
or any securities convertible into or exchangeable or exercisable for or
repayable with Common Stock, whether now owned or hereafter acquired by the
undersigned or with respect to which the undersigned has or hereafter acquires
the power of disposition, or file, or request, demand or cause to be filed, any
registration statement under the Securities Act with respect to any of the
foregoing (collectively, the “Lock-Up Securities”) or (ii) enter into any swap
or any other agreement or any transaction that transfers, in whole or in part,
directly or indirectly, the economic consequence of ownership of the Lock-Up
Securities, whether any such swap or transaction is to be settled by delivery of
Common Stock or other securities, in cash or otherwise.
     Notwithstanding the foregoing, nothing contained in this lock-up agreement
shall prohibit the undersigned from effecting: (A) the sale of shares of Common
Stock pursuant to any 10b5-1 plan established by the undersigned pursuant to
Rule 10b5-1 under the Exchange Act and in

Ex E -1

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effect on the date of the Final Offering Memorandum, (B) any acquisition of
stock options, restricted stock or other stock-based compensation from the
Company pursuant to any existing employee benefit plans, stock incentive plans
or director compensation plans of the Company, (C) any acquisition of shares of
Common Stock upon the vesting of restricted stock or issued by the Company to
the undersigned upon the exercise of options outstanding on the date hereof,
including by means of a cashless exercise, and transfers of shares of Common
Stock to the Company in satisfaction of any tax withholding obligation of the
undersigned or in payment of the exercise price for any stock option exercised
by the undersigned under existing employee benefit plans, stock incentive plans
or director compensation plans of the Company, (D) transfers of shares of Common
Stock or options to purchase the Common Stock made as a bona fide gift or gifts,
provided that the donee or donees thereof agree to be bound by the restrictions
set forth herein, or (E) transfers of shares of Common Stock or options to
purchase the Common Stock made to any trust for the direct or indirect benefit
of the undersigned or the immediate family of the undersigned, provided that the
trustee of the trust agrees to be bound by the restrictions set forth herein,
and provided further that any such transfer shall not involve a disposition for
value.
     The undersigned also agrees and consents to the entry of stop transfer
instructions with the Company’s transfer agent and registrar against the
transfer of the Lock-Up Securities except in compliance with the foregoing
restrictions.
Very truly yours,
Signature:                                         
Print Name:

Ex E -2