Transition Agreement


 Exhibit 10.2 
 TRANSITION AGREEMENT 
 TRANSITION AGREEMENT (this “Agreement”), dated as of
December 7, 2007, by and between StoneMor Operating LLC, a Delaware limited liability company (“StoneMor LLC”), joined herein by those of its direct and indirect subsidiary entities which are parties to the Purchase
Agreement, as defined herein (collectively, with StoneMor LLC, the “Buyer”), and SCI Funeral Services, Inc., an Iowa corporation (“Parent”), joined herein by those of its direct and indirect subsidiary
entities which are parties to the Purchase Agreement (collectively, with Parent, the “Seller”). 
 RECITALS

 A. In accordance with that certain Asset Purchase and Sale Agreement, dated as of December 4, 2007 (the “Purchase
Agreement”), Seller is selling the Business (as defined in the Purchase Agreement) and the assets associated therewith to Buyer. 
 B. Buyer has made application for all Permits required for the operation of the Business which Buyer anticipates receiving on or before the Closing Date. Exhibit “A” sets forth as of the date hereof the current status of
applications for Permits at the Owned Locations and Managed Locations which comprise the Business (collectively the “Locations”). Buyer and Seller wish to make certain arrangements in the event Buyer does not obtain all of the
Permits required to operate the Business and is unable to arrange for Interim Approval as hereinafter defined. 
 NOW, THEREFORE, in
consideration of the covenants and agreements set forth in this Agreement, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Buyer and Seller, intending to be legally bound, hereby agree as
follows: 
 ARTICLE I 
 EFFECT AND DEFINITIONS 
 1.1 Effect of Agreement. This Agreement supplements the Purchase Agreement. 
 1.2 Definitions. Defined terms used in this Agreement and not otherwise defined in this Agreement will have their respective meanings set forth in
the Purchase Agreement. 
 ARTICLE II 
 PERMITS 
 2.1 On or before the Closing Date, Buyer shall identify on Exhibit “B” the
Locations for which Buyer does not anticipate receiving as of the Closing Date either (a) the Permits that it requires to operate or (b) interim approval from applicable regulatory authorities that permit it to operate pending receipt of
required Permits (“Interim Approval”). (Such Locations are referred to as Locations Pending Approval). For each of the Locations Pending Approval, Seller has agreed to continue to operate such Locations for the account of and for the
benefit of the Buyer. Buyer agrees to make both the assets comprising and the employees staffing such Locations available to Seller for such purpose. Buyer further agrees that during the term of this arrangement as hereinafter provided, 

  


			
	TRANSITION AGREEMENT	  	Page 1








 
it will continue to diligently pursue Interim Approval and/or required Permits from applicable regulatory authorities. The parties agree that upon receipt of
either required Permits or Interim Approvals for a Location Pending Approval, Buyer shall promptly assume and undertake operations at such Locations, and Seller shall cease to operate such Location for the benefit of the Buyer. The parties further
agree to amend Exhibit “B” from time to time to delete the Locations Pending Approval for which Buyer has secured Interim Approval or required Permits. 
 ARTICLE III 
 DURATION 
 3.1 The term of this Agreement (the “Term”) will commence as of the Closing Date and will continue on a Location by Location basis until
Buyer as to each Location Pending Approval has secured required Permits or Interim Approval. 
 ARTICLE IV 
 FEES 
 4.1 Buyer agrees to reimburse
the Seller for all costs incurred by Seller while operating Owned Locations for the benefit of Buyer as provided in Article II. 
 ARTICLE
V 
 MISCELLANEOUS 
 5.1 Notices. All notices and other communications required or provided for hereunder shall be in writing and shall be deemed to be given: 
 (a) When delivered personally to the individual, or to an officer of the company, to which the notice is directed; 
 (b) Three (3) business days after the same has been deposited in the United States mail, sent Certified or Registered mail with Return Receipt Requested, postage prepaid and addressed as provided in this Section; or 
 (c) One (1) business day after the same has been deposited with a generally recognized overnight delivery service (including United States Express
Mail), with receipt acknowledged and with all charges prepaid by the sender addressed as provided in this Section. Except as specifically provided otherwise herein, notices and other communications relating to this Agreement or the transactions
contemplated hereby shall be directed as follows: 
  

			
	if to Seller, to:	  	
		
		  	 President
 SCI Funeral Services, Inc.
 1929 Allen Parkway
 Houston, Texas 77019


  


			
	TRANSITION AGREEMENT	  	Page 2









			
		
		  	 with a copy to:
  
 General Counsel
 Service Corporation International
 1929 Allen Parkway
 Houston, Texas 77019

		
	if to Buyer, to:	  	
		
		  	 StoneMor Operating, LLC
 Attention: Lawrence Miller,
President & Chief Executive Officer
 155 Rittenhouse Circle
 Bristol, Pennsylvania 19007
  
 with a copy to:
  
 Blank Rome LLP
 Attention: Lewis J. Hoch
 One Logan Square
 18th & Cherry Streets
 Philadelphia, Pennsylvania
19103-6998


 or at such other place or places or to such other person or persons as shall be designated by like notice by any
party hereto. 
 5.2 Compliance. Each of Seller and Buyer agrees that it will take appropriate action by instruction of or agreement
with its personnel to ensure that all personnel performing services under this Agreement will be bound by and comply with all of the terms and conditions of this Agreement. 
 5.3 Relationship of Parties. The relationship between the parties created by this Agreement is that of independent contractors and not partners,
joint venturers or agents. 
 5.4 Arbitration. Any dispute concerning this Agreement, its effect, or the transactions contemplated by
it, shall be settled by arbitration in accordance with Section 8.6 of the Purchase Agreement. 
 5.5 Assignment; Parties in
Interest. This Agreement shall inure to the benefit of and be binding upon the parties hereto and their respective successors and permitted assigns. This Agreement shall not be assigned by any party hereto without the prior written consent of
the other parties. Nothing in this Agreement, expressed or implied, is intended to confer upon any third person any rights or remedies under or by reason of this Agreement. 
  


			
	TRANSITION AGREEMENT	  	Page 3








 5.6 Entire Agreement; Amendment; Waiver. 
 (a) This Agreement together with the Exhibits hereto and the Purchase Agreement embody the whole agreement of the parties with respect to the subject
matter hereof and thereof. There are no promises, terms, conditions, or obligations other than those contained herein and therein. All previous negotiations between the parties, either verbal or written, not herein or therein contained are hereby
withdrawn and annulled. This Agreement, together with the Exhibits hereto, and the Purchase Agreement supersede all previous communications, representations, or agreements, either verbal or written, between the parties hereto with respect to the
subject matter hereof. 
 (b) This Agreement may not be amended except by an instrument in writing signed by an authorized representative on
behalf of each party hereto. 
 (c) No provision of this Agreement may be waived unless such waiver is in writing and signed by the party
against whom the waiver is to be effective. No waiver by any party of any provision of this Agreement in a particular instance shall be deemed to constitute a waiver of such provision thereafter unless otherwise agreed in writing and signed by the
party against whom the waiver is to be effective. 
 (d) No failure or delay by any party in exercising any right, power or privilege
hereunder shall operate as a waiver thereof nor shall any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any other right, power or privilege. 
 5.7 Severability. If one or more provisions of this Agreement shall be held invalid, illegal or unenforceable, such provision shall, to the extent
possible, be modified in such manner as to be valid, legal and enforceable but so as to most nearly retain the intent of the parties, and if such modification is not possible, such provision shall be severed from this Agreement. In either case, the
balance of this Agreement shall be interpreted as if such provision were so modified or excluded, as the case may be, and shall be enforceable in accordance with its terms. 
 5.8 Certain Interpretive Matters. The section and subsection headings contained in this Agreement are for reference purposes only and shall not
affect in any way the meaning or interpretation of this Agreement. No provision of this Agreement will be interpreted in favor of, or against, any of the parties to this Agreement by reason of the extent to which any such party or its counsel
participated in the drafting thereof or by reason of the extent to which any such provision is inconsistent with any prior draft hereof or thereof. The singular form of any word used herein shall be deemed to include the plural form of such word and
vice versa. References herein to feminine, masculine or neuter gender shall be deemed to include all genders. As used herein, the words “and” and “or” shall be deemed to mean “and/or” as the context requires.

 5.9 Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument. 
 5.10 Governing Law. This Agreement shall be construed and enforced in
accordance with the laws of the State of Delaware, without regard to principles of conflicts of laws. 
  


			
	TRANSITION AGREEMENT	  	Page 4








 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their respective duly
authorized officers on the date first above written. 
 BUYER: 
 STONEMOR OPERATING LLC,  
 a Delaware limited liability company 
 STONEMOR ALABAMA LLC, 
 an Alabama limited liability company 
 STONEMOR ALABAMA SUBSIDIARY, INC.,  
 an Alabama corporation

 STONEMOR ARKANSAS SUBSIDIARY LLC,  
 an Arkansas limited
liability company 
 STONEMOR CALIFORNIA, INC., 
 a
California corporation 
 STONEMOR CALIFORNIA SUBSIDIARY, INC., 
 a California corporation 
 STONEMOR FLORIDA SUBSIDIARY LLC, 
 a Florida limited liability company 
 STONEMOR HAWAII LLC,

 a Hawaii limited liability company 
 STONEMOR HAWAII
SUBSIDIARY LLC, 
 a Hawaii limited liability company 
 STONEMOR IOWA LLC,  
 an Iowa limited liability company 
 STONEMOR IOWA SUBSIDIARY LLC,  
 an Iowa limited liability company 
 STONEMOR ILLINOIS LLC, 
 an Illinois limited liability company 
 STONEMOR ILLINOIS SUBSIDIARY LLC, 
 an Illinois limited liability
company 
  

 TRANSITION AGREEMENT 







 STONEMOR INDIANA LLC, 
 an Indiana limited liability company 
 STONEMOR INDIANA SUBSIDIARY LLC, 
 an Indiana limited liability company 
 STONEMOR KENTUCKY LLC, 
 a Kentucky limited liability company 
 STONEMOR KENTUCKY SUBSIDIARY
LLC, 
 a Kentucky limited liability company 
 STONEMOR MISSOURI LLC, 
 a Missouri limited liability company 
 STONEMOR MISSOURI SUBSIDIARY LLC, 
 a Missouri limited liability company 
 STONEMOR NORTH CAROLINA LLC, 
 a North Carolina limited
liability company 
 STONEMOR NORTH CAROLINA SUBSIDIARY LLC, 
 a North Carolina limited liability company 
 CEMETERY MANAGEMENT SERVICES OF OHIO, 
 an Ohio limited liability company 
 CORNERSTONE FUNERAL AND CREMATION
SERVICES LLC, 
 a Delaware limited liability company 
 STONEMOR OREGON LLC, 
 an Oregon limited liability company 
 STONEMOR OREGON SUBSIDIARY LLC, 
 an Oregon limited liability company 
 STONEMOR SOUTH CAROLINA LLC, 
 a South Carolina limited
liability company 
 STONEMOR SOUTH CAROLINA SUBSIDIARY LLC, 
 a South Carolina limited liability company 
 LAKEWOOD HAMILTON CEMETERY LLC,  
 a Tennessee limited liability company 
  

 TRANSITION AGREEMENT 







 LAKEWOOD HAMILTON CEMETERY SUBSIDIARY, INC., 
 a Tennessee corporation 
 STONEMOR TENNESSEE SUBSIDIARY, INC.,  
 a Tennessee corporation 
 STONEMOR WASHINGTON, INC., 
 a Washington corporation 
 STONEMOR WASHINGTON SUBSIDIARY, INC.,

 a Washington corporation 
 CORNERSTONE FAMILY SERVICES OF
WEST VIRGINIA SUBSIDIARY, INC.,  
 a West Virginia corporation 
 STONEMOR PUERTO RICO LLC, 
 a Puerto Rico limited liability company 
 STONEMOR PUERTO RICO SUBSIDIARY LLC, 
 a Puerto Rico limited
liability company 
 In each case, 
  

			
	By:	 	 /s/ PAUL WAIMBERG

		 	PAUL WAIMBERG, Vice President of Finance

  

 TRANSITION AGREEMENT 







 SELLER: 
 SCI FUNERAL SERVICES, INC., 
 an Iowa corporation 
 ECI ALABAMA SERVICES, LLC,  
 an Alabama limited liability company 
 JPH PROPERTIES, INC., 
 a Texas corporation 
 SCI ALABAMA FUNERAL SERVICES, INC., 
 an Alabama corporation 
 SCI ARKANSAS FUNERAL SERVICES, INC., 
 an Arkansas corporation

 ALDERWOODS GROUP (CALIFORNIA), INC., 
 a California
corporation 
 SCI CALIFORNIA FUNERAL SERVICES, INC., 
 a
California corporation 
 UNIVERSAL MEMORIAL CENTERS VI, INC., 
 a California corporation 
 SECURITY TRUST PLANS, INC., 
 a Florida corporation 
 HAWAIIAN MEMORIAL LIFE PLAN, LTD., 
 a Hawaii corporation 
 SCI IOWA FUNERAL SERVICES, INC., 
 an Iowa corporation 
 ALDERWOODS (CHICAGO NORTH), INC., 
 an Illinois corporation 
 PINEVIEW MEMORIAL PARK, INC., 
 an Illinois corporation 
 ALDERWOODS (ILLINOIS), INC., 
 an Illinois corporation 
 WOODLAWN MEMORIAL PARK, INC., 
 an Illinois corporation 
  

 TRANSITION AGREEMENT 







 ELMWOOD ACQUISITION CORPORATION,  
 an Illinois corporation 
 ALDERWOODS (INDIANA), INC., 
 an Indiana corporation 
 SCI INDIANA FUNERAL SERVICES, INC., 
 a Delaware corporation 
 SCI KENTUCKY FUNERAL SERVICES, INC.,

 a Kentucky corporation 
 SCI MISSOURI FUNERAL SERVICES,
INC., 
 a Missouri corporation 
 LINEBERRY GROUP,
INC., 
 a North Carolina corporation 
 CAROTHERS
HOLDING COMPANY, INC., 
 a North Carolina corporation 
 CINCINNATI CEMETERIES LIMITED PARTNERSHIP, 
 an Ohio limited partnership 
 ALDERWOODS (OHIO) FUNERAL HOME, INC., 
 an, Ohio corporation 
 UNIVERSAL MEMORIAL CENTERS I, INC., 
 an Oregon corporation 

ALDERWOODS (OREGON), INC., 
 an Oregon corporation 
 ALDERWOODS (SOUTH CAROLINA), INC.,  
 a South Carolina corporation

 GRACELAND CEMETERY DEVELOPMENT CO., 
 a South
Carolina corporation 
 ALDERWOODS (TENNESSEE), INC., 
 a Tennessee corporation 
 ALDERWOODS (WASHINGTON), INC., 
 a Washington corporation 
  

 TRANSITION AGREEMENT 







 ALDERWOODS (WEST VIRGINIA), INC., 
 a West Virginia corporation 
 SCI PUERTO RICO FUNERAL AND CEMETERY SERVICES, INC., 
 a Puerto Rico corporation 
 SCI OHIO FUNERAL SERVICES, INC.,

 an Ohio corporation 
 ALDERWOODS (OHIO) CEMETERY MANAGEMENT,
INC., 
 an Ohio corporation 
 In each case, 

  

			
	By:	 	 /s/ Michael D. Lehman

		 	Michael D. Lehman, Vice President

  

 TRANSITION AGREEMENT 







 EXHIBIT A 
 Dignity 2007 – Licensure Status Chart 
 (last revised 12/6/2007) 
  

			
	 State
	  	 Status of Licensure

	 ALABAMA
  
 (2 cemeteries, 2 funeral homes)
	  	funeral establishment licensure is issued post-closing - Board of Funeral Services
		  	cemetery/funeral establishment preneed licensure is pending, expected in December - Department of Insurance,
		
	 ARKANSAS
  
 (2 funeral homes)
	  	 funeral establishment licensure is issued post-closing - State Board of Embalmers and Funeral Directors
  
 preneed pending, expected in December - Insurance Department

		
	 CALIFORNIA
  
 (7 cemeteries, 8 funeral homes, 4 crematories)
	  	pending, expected in December; interim approval being sought to coincide with public offering - Cemetery and Funeral Bureau 
		
	 FLORIDA
  
 (1 funeral home)
	  	pending, funeral establishment licensure expected by Board teleconference meeting in January and preneed licensure expected at Board meeting in February - Board of Funeral, Cemetery and
Consumer Services
		
	 HAWAII
  
 (1 cemetery)
	  	pending, expected in December - Cemetery and Pre-Need Funeral Authority
		
	 ILLINOIS
  
 (5 cemeteries, 2 funeral homes, 2 crematories)
	  	pending, expected in December (subject to satisfactory audits of SCI) - Comptroller, Cemetery Care and Burial Trust Division

  
 TRANSITION AGREEMENT

  

 A-1 








			
	 State
	  	 Status of Licensure

	 INDIANA
  
 (5 cemeteries, 1 crematory)
	  	8 of 12 licenses issued December 6, remaining 4 licenses expected shortly (pending status for those 4 noted in Board’s licensure database) - State Board of Funeral and Cemetery
Service
		
	 IOWA
  
 (1 cemetery)
	  	Pending, expected by December 19 subject to satisfactory SCI audit - Insurance Division, Securities and Regulated Industries Bureau
		
	 KENTUCKY
  
 (1 cemetery)
	  	licenses issued October 1, 2007 - Office of the Attorney General
		
	 MISSOURI
  
 (2 cemeteries, 1 funeral home)
	  	licensure issues post-closing, awaiting confirmation receipt of City of Sedalia business licenses as a licensure condition - Office of Endowed Care Cemeteries; State Board of Embalmers
and Funeral Directors
		
	 NORTH CAROLINA
  
 (3 cemeteries)
	  	October 17 meeting approval - Cemetery Commission
		
	 OHIO
  
 (7 cemeteries, 1 funeral home, 1 crematory)
	  	 Cemetery licensure approved at December 6 meeting subject to conditions to be satisfied within 30 days - Cemetery Dispute Resolution
Commission
  
 funeral establishment licensure is issued post-closing - State Board
of Embalmers and Funeral Directors


  
 TRANSITION AGREEMENT

  

 A-2 








			
	 State
	  	 Status of Licensure

	 OREGON
  
 (2 cemeteries, 3 funeral homes)
	  	 pending, the Board has advised they will attempt to issue temporary authority to operate all facilities prior to the intended closing date of
December 19 - Mortuary and Cemetery Board
  
 preneed is issued post-closing
after transfer of assumed names - Division of Finance and Corporate Securities

		
	 SOUTH CAROLINA
  
 (2 cemeteries, 2 funeral homes)
	  	 cemetery licensure approved at November 28 meeting subject to conditions being satisfied - Perpetual Care Cemetery Board
  
 funeral establishment licensure expected at December 13 meeting - Board of Funeral
Service
  
 pending preneed funeral homes, expected in December 19 - Department of
Consumer Affairs

		
	 TENNESSEE
  
 (3 cemeteries, 4 funeral homes)
	  	pending, expected in December; interim approval being sought to coincide with public offering - Department of Commerce and Insurance
		
	 WASHINGTON
  
 (2 cemeteries)
	  	Licenses issued 9/28/2007 - Department of Licensing, Funeral and Cemetery Licensing Office 
		
	 WEST VIRGINIA
  
 (1 funeral home)
	  	 funeral establishment licensure pending (require contract or price list modifications), expected in December - Board of Funeral Service
Examiners
  
 preneed licensure is issued post-closing upon notice of closing -
Consumer Protection and Antitrust Division


  
 TRANSITION AGREEMENT

  

 A-3 








			
	 State
	  	 Status of Licensure

	 PUERTO RICO
  
 (2 cemeteries, 1 funeral home)
	  	post-closing - Ponce Municipal Permits Office; Regulations and Permits Administration Office - Health Department, Fire Department - use permits will issue approximately 2 to 3
months post-closing

  
 TRANSITION AGREEMENT

  

 A-4 







 EXHIBIT B 
  

TRANSITION AGREEMENT 
  

 B-1