UNITED STATES OF AMERICA

BEFORE FEDERAL TRADE COMMISSION

In the Matter of )

)

Service Corporation International, ) Docket No. C-4423

a corporation, and ) File No. 131 0163

)

Stewart Enterprises, Inc., )

a corporation )

) 

PETITION OF RESPONDENTS FOR APPROVAL OF PROPOSED

DIVESTITURE OF CERTAIN ASSETS OF THE DIVESTITURE BUSINESSES

 

Pursuant to Section 2.41(f) of the Federal Trade Commission 

(“Commission”) Rules of Practice and Procedure, 16 C.F.R. § 2.41(f) (2012), and 

Paragraphs II.A of the Decision and Order contained in the Agreement Containing Consent 

Orders accepted for public comment in this matter (“Decision and Order”), Respondent 

Service Corporation International (“SCI”) hereby petitions the Commission to approve the 

divestiture to Heritage Family Funeral Services, Inc. (“HFFS”) and Heritage Family 

Cemetery, Inc. (“HFC”) of the Divestiture Businesses associated with the following facility: 

Oak Hill Memorial Park, Funerals and Cremations, 800 Truxton Drive, Kingsport, 

Tennessee 37660.

The Divestiture Businesses associated with this facility (as defined in the 

Decision and Order, and hereinafter collectively referred to as the “Divestiture Assets”) 

will be sold pursuant to two Asset Sale Agreements dated June 23, 2014, by and among 

HFFS, HFC, and S.E. Combined Services of Tennessee, Inc., a subsidiary of SCI (the 

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“ASAs”). HFFS is an S Corporation that is owned by The 2000 Richard Tetrick 

Irrevocable Trust. HFC is a 501(c)(13) not-for-profit cemetery company governed by an 

elected Board of Directors. HFC has a management agreement with Heritage Family 

Management, LLC (“HFM”), which is also owned by The 2000 Richard Tetrick Irrevocable 

Trust. HFM performs services including, but not limited to, pre-employment screening, 

human resources, information technology support, payroll functions, accounting, corporate 

offices, training, continuing education, business contract negotiations, and marketing. 

Background

On December 23, 2013, SCI and Respondent Stewart Enterprises, Inc. 

(“Stewart”) (collectively, the “Respondents”) executed an Agreement Containing Consent 

Orders that included the Decision and Order and Order to Hold Separate and Maintain 

Assets (collectively, the “Consent Agreement”) to settle the Commission’s charges that the 

proposed acquisition by SCI of Stewart would violate Section 5 of the Federal Trade 

Commission Act, as amended, 15 U.S.C. § 45, and Section 7 of the Clayton Act, as 

amended, 15 U.S.C. § 18. On December 23, 2013, the Commission accepted the Consent 

Agreement for public comment, and on December 23, 2013, SCI consummated its 

acquisition of Stewart. Stewart is now a wholly owned subsidiary of SCI. The 

Commission issued the Consent Agreement as final on April 29, 2014.

Because this petition and its attachments contain confidential and 

competitively sensitive business information relating to the divestiture of the Divestiture 

Assets—the disclosure of which may prejudice the Respondents and Heritage, cause harm 

to the ongoing competitiveness of the Divestiture Assets, and impair Respondents’ ability 

to comply with their obligations under the Consent Agreement—Respondents have 

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redacted such confidential information from the public version of this petition and its 

attachments. Pursuant to Sections 2.41(f)(4) and 4.9(c) of the Commission’s Rules of 

Practice and Procedure, 16 C.F.R. § 2.41(f)(4) & 4.9(c) (2012), Respondents request that 

the non-public, confidential version of this petition and its attachments and the information 

contained herein be accorded confidential treatment. The confidential version of this 

petition should be accorded such confidential treatment under 5 U.S.C. § 552 and Section 

4.10(a)(2) of the Commission’s Rules of Practice and Procedure, 16 C.F.R. § 4.10(a)(2) 

(2012). The confidential version of this petition is also exempt from disclosure under 

Exemptions 4, 7(A), 7(B), and 7(C) of the Freedom of Information Act, 5 U.S.C. §§ 

552(b)(4), 552(b)(7)(A), 552(b)(7)(B), & 552(b)(7)(C), and the Hart-Scott-Rodino 

Antitrust Improvements Act of 1976, as amended, 15 U.S.C. § 18a(h). 

SCI desires to complete the proposed divestiture of the Divestiture Assets as 

soon as possible, following Commission approval thereof. All conditions other than 

Commission approval have already been satisfied so that SCI, HFFS, and HFC are in a 

position to close the divestiture within a few days of such approval. Prompt consummation 

will further the purposes of the Decision and Order and is in the interests of the public, 

HFFS, HFC, and the Respondents, because it will allow HFFS and HFC to move forward 

with their business plans for the competitive operation of the Divestiture Assets. SCI 

accordingly requests that the Commission promptly commence the period of public 

comment pursuant to Section 2.41(f)(2) of the Commission’s Rules of Practice and 

Procedure, 16 C.F.R. § 2.41(f)(2) (2012), limit the public comment period to the customary 

30-day period, and grant this petition by approving the divestiture of the Divestiture Assets 

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to HFFS and HFC pursuant to the above-referenced ASAs as soon as practicable after the 

close of the public comment period. 

I. The ASAs Are Final and Consistent with the Decision and Order’s Terms

Paragraph II.A of the Decision and Order requires the Respondents to divest the 

Divestiture Businesses (as defined in the Decision and Order) within 180 days of the date on 

which the Order is issued.1 Pursuant to this requirement, SCI diligently has sought buyers that 

would be acceptable to the Commission, through an extensive auction process that produced 

great interest in the properties. As noted above, on June 23, 2014, SCI entered into the ASAs 

with HFFS and HFC, which require SCI to sell the Divestiture Assets to HFFS and HFC. The 

executed ASAs are attached hereto as Confidential Exhibit A and Confidential Exhibit B. 

The ASAs with HFFS and HFC comply with the requirements of Paragraph II of 

the Decision and Order. Paragraph II.A requires that Respondents divest the Divestiture Assets, 

absolutely and in good faith. Pursuant to the ASAs, HFFS and HFC will acquire the Divestiture 

Assets. See ASA § 1.1 (same provision in both ASAs). 

HFFS and HFC have acknowledged that the Divestiture Assets, together with 

their existing resources, enable them to operate the Divestiture Assets as ongoing entities and 

that no other assets are needed from SCI to do so. See ASA § 4.4 (same provision in both 

ASAs).

* * * 

As demonstrated above and in the accompanying ASAs, SCI has entered into 

agreements relating to the divestiture of the Divestiture Assets that fully comply with the 

Commission’s Decision and Order with respect to the divestiture of these assets. Accordingly, 

 

1 The Commission issued the final Order on April 29, 2014.

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Respondents hereby seek Commission approval of the proposed divestitures pursuant to 

Paragraph II.A of the Decision and Order. 

II. The Prospective Acquirer Will Be a Strong and Effective Competitor

A. Background 

HFFS and HFC have extensive experience in acquiring and operating funeral 

homes and cemeteries, have the financial wherewithal to make this acquisition, and the 

acquisition of the businesses in question by HFFS and HFC will ensure that those businesses 

remain strong and effective competitors in Kingsport, Tennessee. 

Donald W. Tetrick, Sr., acquired the North Funeral Home in Elizabethton, 

Tennessee, in 1943 and rebranded it as the first Tetrick Funeral Home. Mr. Tetrick and his 

father, Glen W. Tetrick, operated the funeral home together until 1959 when Glen W. Tetrick 

retired. Don Tetrick’s son, Richard Tetrick, joined the business in 1968. The Tetrick family’s 

commitment to compassionate personal service allowed the company to expand, and by 1990, 

the Tetricks operated twelve (12) funeral homes in Tennessee, North Carolina, and Virginia. 

Tetrick Funeral Home officially became HFFS in 1991 and continued to bring 

other funeral homes into the parent company of HFFS. 

Today, HFFS and HFC own 21 funeral homes, seven cemeteries, and two 

cremation societies in the states of Georgia, Kentucky, North Carolina, Tennessee and Virginia, 

as well as a pet cremation businesses, a casket distribution business, an insurance agency, and a 

burial vault company. HFFS has grown from serving 38 families in 1943 to 3,097 families in 

2013. 

Richard Tetrick, the president of HFFS, has served in the death care industry in 

various ways throughout his career. He has served on the board of Tennessee Funeral Directors 

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Association; as president of the Upper East Tennessee Funeral Director Association and of the 

Tri-Cities Funeral Director Association; as a member and chairman of the Tennessee State Board 

of Funeral Directors and Embalmers; and as a board member and secretary of an international 

trade group, Selected Independent Funeral Homes, the largest independent funeral home 

association in the world. 

HFFS’s Chief Financial Officer, Renee Lockhart, has been with the company for 

25 years, and its Chief Operating Officer, Mark Aaroen, has 28 years of experience in the death 

care industry. Tyler Tetrick, president of HFC, has over 10 years of experience in the cemetery 

industry. 

Today HFFS and HFC employ 123 full-time employees and 94 part-time 

employees. The total revenue for HFFS and HFC in 2013 was The funeral homes 

and cremation societies served 3,097 families in 2013. The cemeteries conducted a total of 924 

interments, entombments and inurnments in 2013. 

B. Financial Capability

HFFS and HFC plan to retain all assets involved in the purchase of the Divestiture 

Assets. HFFS currently has a credit line of with Citizens Bank of the Tri-Cities 

based in Elizabethton, Tennessee. HFFS plans to use of the credit line, along with 

of HFC’s cash reserves toward the purchase price, and finance the rest of the purchase 

price from existing capital that is an asset of the company or its owners. At the present time, 

neither HFFS nor HFC have any bank debt. All necessary financing during the past 34 years has 

been from internal cash flow or loans from Citizens Bank of the Tri-Cities, SunTrust Bank or 

Security Federal Bank. The company anticipates retiring the line of credit within 36 

months. 

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HFFS intends to implement the following measures to improve the business of the 

Divestiture Assets: 

 

 

 

C. Operations Experience

Richard Tetrick, President and Chief Executive Officer 

Richard Tetrick began working for his father in the funeral home at the age of 16. 

He worked in the funeral home as a part-time employee through high school and college. Upon 

graduation from Mortuary College, he became a full-time employee working with his father until

his father’s retirement in 1980. Richard first began to grow his family’s business when he 

opened a small satellite funeral home in Roan Mountain, Tennessee, which is known today as 

Tetrick Funeral Home-Rhododendron Chapel. At the age of 27, Richard developed the project 

and personally secured all necessary financing to complete the project. That same year, Richard 

and his father incorporated the Tetrick Funeral Home and Richard acquired 50% of the 

ownership of the newly formed corporation. When Richard’s father retired in 1980, Richard 

purchased the remainder of the stock of Tetrick Funeral Home, Inc. from his father. Since the 

initial purchase, Richard has participated in and secured financing for the purchase or 

development of 23 funeral homes, nine cemeteries, two cemetery monument companies, two pet 

cremation businesses, two cremation societies, and a casket distribution company that sells 

caskets to funeral homes across the tri-state area. 

Further, Richard Tetrick is a licensed funeral director and embalmer in the states 

of North Carolina and Tennessee. He is a member of various study groups that are involved in 

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the improvement of the operation of funeral homes and cemeteries in the death care industry. As 

a funeral director, Richard has made arrangements for and directed over 5,000 services during 

his career. Since 1988, Richard has assumed more of a managerial role instead of being a frontline funeral director. Richard has been a speaker for National Funeral Directors Association 

(NFDA) and Selected Independent Funeral Homes (SIFH) on numerous occasions. Most 

recently, he was a speaker for NFDA in their Meet The Mentor program and for SIFH in their 

Selected Connections Program, at which he spoke about how to evaluate and acquire funeral 

homes. Over the years, Heritage Funeral Homes have been continually recognized for their 

ability to provide innovate ideas to better serve families. 

Tyler Tetrick, President, Heritage Family Cemetery 

Tyler Tetrick has a BS degree in analytical finance and a Master’s Degree in 

Accountancy from Wake Forest University. Upon graduating from college in 2003, he became a 

certified CPA and worked with PriceWaterhouseCoopers in Kingsport, Tennessee. He joined 

HFC in 2005. At that time, HFC was struggling financially and had long-term debt in excess of 

 Since assuming the role of President, Tyler has improved the operation of the 

cemeteries by reducing the expenses and improving the sales of the cemeteries. As a result, the 

cemeteries have no debt and presently have in excess in cash reserves. Tyler has 

been instrumental in developing new mausoleum inventory and cremation gardens in the 

cemeteries. He is a member of the Death Care Management Council and presently serves as the 

president of the Cemetery Association of Tennessee. He is also a licensed funeral director in the 

state of Tennessee. 

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Renee Lockhart, Vice President and Chief Financial Officer 

Renee Lockhart is originally from Middlesboro, Kentucky, but came to Johnson 

City in 1983 to pursue her degree at East Tennessee State University. She completed her 

Bachelor in Business Administration with a concentration in Accounting in 1987 and her 

Master’s in Accountancy in 1989. In April 1990, she joined HFFS. At that time, HFFS had 11 

funeral homes in three states with revenues of slightly over and a corporate office 

staff of three, which included the President, the Human Resources director, and Renee. Over the 

past 24 years, Renee has been part of the team that has seen Heritage grow to 21 funeral homes 

in five states with funeral home revenues of over at the end of 2013. 

During her tenure, she has been involved with every Heritage acquisition, 

including performing the due diligence work, assisting with the contract negotiations, and 

coordinating the implementation of the new policies and procedures. In addition to working on 

acquisitions, Renee also oversees all aspects of the Accounting Department, including financial 

statement preparation for over 40 Heritage-affiliated entities, budget preparation for all funeral 

homes, accounts payable for all entities, payroll for over 200 employees, sales tax for five states, 

and internal auditing for all entities. Renee also coordinates the financial accounting for the 

Funeral Directors Council study group and The Discovery study group. 

In addition to her career, Renee also remains involved in the community. She is a 

former member of the Elizabethton Civitan Club and the Elizabethton Rotary Club, currently 

serves the President-Elect of the East Tennessee State University Alumni Association Board of 

Directors, and was recently chosen to serve as a member of the East Tennessee State University 

Foundation. In 2001, Renee was selected as one of the top 40 business professionals in the TriPUBLIC VERSION 9
Cities, Tennessee, area under the age of 40. In 2003, she was inducted into the ETSU College of 

Business Hall of Fame in 2003 as a Horizon Award winner. 

Mark Aaroen, Vice President and Chief Operations Officer 

Mark Aaroen received his Bachelor’s Degree from the University of Wisconsin – 

Eau Claire, and his Associate Degree in Funeral Service from the New England Institute of Arts 

and Sciences in Boston, Massachusetts. Mark has been a licensed funeral director and embalmer 

for 27 years. During that time he has served in a management capacity for Murray Community 

Funeral Homes in Beaver Dam, Wisconsin, Krause Funeral Home and Cremation Services in 

Milwaukee, Wisconsin, and the Harry J. Will Funeral Homes in Detroit, Michigan. In May 

2009, he joined HFFS as Chief Operations Officer. He served as president of the Funeral 

Service Alliance of Wisconsin, and has member affiliations with the State Funeral Director 

Associations in Wisconsin, Michigan and Tennessee, the National Funeral Director Association, 

the International Cemetery, Crematory and Funeral Association, and Selected Independent 

Funeral Directors. 

 As Chief Operating Officer, Mark oversees 21 funeral locations and two 

cremations societies. He oversees a licensed staff 38 professional funeral directors and four 

intern apprentices, plus all of the part-time staff associated with the funeral homes. Since Mark 

joined HFFS, funeral calls have increased by 544 annually, increasing from 2,653 his first year 

with HFFS to 3,097 in 2013. Mark has 18 managers who report directly to him. Since joining 

HFFS, he has participated in the acquisition and integration into HFFS of four funeral home 

properties located in Georgia, Kentucky, and Tennessee. 

HFFS and HFC plan to retain all existing staff. Some staff members may be 

employed in other HFFS properties in the Tri-Cities area in addition to working at the divestiture 

PUBLIC VERSION 10
business. As discussed above, HFFS and HFC have sufficient operating expertise to not only 

ensure the continued competitiveness of the Divestiture Assets, but to enhance it. 

III. The Proposed Divestiture Agreement Will Achieve the Purposes of the Decision and 

Order and Result in No Harm to Competition

The proposed divestiture of the Divestiture Assets, as embodied in the ASAs, will 

achieve the purposes of the Decision and Order. HFFS and HFC are experienced operators of 

funeral homes and cemeteries, with a proven track record of successfully operating and 

enhancing the funeral homes and cemeteries that they have acquired in the past. HFFS and HFC 

enjoy a strong financial position that will enable them to complete this acquisition, continue the 

operation of the Divestiture Assets, and enhance their competitiveness in the death care industry. 

Combining the Divestiture Assets with HFFS and HFC’s experience and financial wherewithal 

will ensure that the objectives of the Commission’s Decision and Order will be realized.

The proposed acquisition of the Divestiture Assets does not present any 

competitive concerns because the Divestiture Assets do not compete with HFFS or HFC’s 

current locations. HFFS and HFC currently own the following properties: 

Georgia

Peachtree Cremation Society-329 Gees Mill Parkway NE, Conyers, GA 30013 

Peachtree Pet Cremation-120 Scenic Highway, Lawrenceville, GA 30046 

Tom M Wages Funeral Home-120 Scenic Highway, Lawrenceville, GA 30046 

Tom M Wages Funeral Home – 3705 Highway 78, Snellville, GA 30039 

Starling-Evans Funeral Home-U S Highway 78, Harlem, GA 30814 

Kentucky

London Funeral Home-879 South Main Street, London, KY 40741 

North Carolina 

Ashelawn Memorial Chapel-3740 U S 221, Jefferson, NC 28617 

Badger Funeral Home-300 North Main Street, West Jefferson, NC 28694 

Grandview Memorial Funeral Home-789 Grandview Drive, Sparta, NC 28675 

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Reins-Sturdivant Funeral Home-296 Ash Street, Newland, NC 28657 

Webb Funeral Home-208 Roan Road, Spruce Pine, NC 28777 

Ashelawn Memorial Gardens-3740 U S 221, Jefferson, NC 28617 

Tennessee: 

Tetrick Funeral & Cremation Services – Johnson City, 3001 Peoples Street, Johnson City, TN 

37604 

Tetrick Funeral Home – Bluff City Chapel, 245 Main Street, P.O. Box 425, Bluff City, TN 

37618 

Tetrick Funeral Home – Elizabethton, 211 North Riverside Drive, P.O. Box 730, Elizabethton, 

TN 37644 

Tetrick Funeral Home – Roan Mountain, 8460 Highway 19 E, Roan Mountain, TN 37687 

Hathaway-Percy Funeral Home-101 East F Street, Elizabethton, TN 37643 

Valley Funeral Home- 1085 N. Main Street, Erwin, TN 37650 

Oakley-Cook Funeral Home-2223 Volunteer Parkway, Bristol, TN 37620 

Jim Rush Funeral Home-2603 North Ocoee Street, Cleveland, TN 37312 

Jim Rush Funeral Home-220 Wildwood Chapel-Cleveland, TN 37311 

Cremation Society of North East Tennessee-2295 Highway 19E, Elizabethton, TN 37643 

Washington Co. Memory Gardens, 113 Memory Gardens Road, Johnson City, TN 37615 

Evergreen Cemetery, 1100 Seventh Street, P.O. Box 570, Erwin, TN 37650 

Glenwood/Shelby Hills Cemetery, 839 Bluff City Highway, Bristol, TN 37620 

Adored Pets Crematory -2295 Highway 19E, Elizabethton, TN 37643 

Summit Casket Company-129 Judge Don Lewis Road, Elizabethton, TN 37643 

Heritage Vault Service-129 Judge Don Lewis Road, Elizabethton, TN 3743 

Virginia

Blevins Funeral Home – 417 Lee Street, Bristol VA 24201 

Castlewood Funeral Home- 80 Donnie Dean Drive, Castlewood, VA 24224 

Garrett Funeral Home-203 North Shady Avenue, Damascus, VA 24236 

Mountain View Cemetery, 1019 E. Valley Drive, Bristol, VA 24201 

Knollkreg Memorial Park, 556 Walden Road, Abingdon, VA 24210 

Sunset Memorial Park, 21674 Monroe Road, P.O. Box 556, Damascus, VA 24236 

The proposed divestiture will result in no harm to competition. Neither HFFS nor 

HFC currently compete in any market, as defined in the Commission’s Complaint, in which the 

Divestiture Assets operate. 2

 Consequently, there is no overlap between the operations of HFFS, 

HFC, and the Divestiture Assets, and the proposed divestiture does not raise any competitive 

issue. 

 

2 The Commission’s Complaint defined the relevant market as cemetery services in Kingsport, Tennessee. See

Complaint ¶ 15 (22). As Commission staff have recognized, Johnson City and Kingsport are two separate markets 

because customers in Johnson City will not travel to Kingsport for potential competitive alternatives, and vice versa. 

PUBLIC VERSION 12



Confidential 

Exhibit A 

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Confidential 

Exhibit B 

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