Document:

Exhibit

Exhibit 10.1
Execution Version
EIGHTH AMENDMENT AND COMMITMENT INCREASE TO CREDIT AGREEMENT
THIS EIGHTH AMENDMENT AND COMMITMENT INCREASE TO CREDIT AGREEMENT (this “Eighth Amendment”), dated as of April 25, 2018, is by and among CARRIAGE SERVICES, INC., a Delaware corporation (the “Borrower”), the banks listed as Lenders on the signature pages hereof (the “Lenders”), and BANK OF AMERICA, N.A., as Administrative Agent, Swing Line Lender and L/C Issuer (in said capacity as Administrative Agent, the “Administrative Agent”).
BACKGROUND
A.The Borrower, certain of the Lenders, and the Administrative Agent are parties to that certain Credit Agreement, dated as of August 30, 2012, as amended by that certain First Amendment to Credit Agreement, dated as of November 29, 2012, that certain Second Amendment to Credit Agreement, dated as of February 14, 2013, that certain Third Amendment and Commitment Increase, dated as of April 23, 2013, that certain Fourth Amendment to Credit Agreement, dated as of February 27, 2014, that certain Fifth Amendment and Commitment Increase to Credit Agreement, dated as of April 14, 2014, that certain Sixth Amendment and Commitment Increase to Credit Agreement, dated as of May 20, 2015, and that certain Seventh Amendment to Credit Agreement, dated as of February 9, 2016 (said Credit Agreement, as amended, the “Credit Agreement”; the terms defined in the Credit Agreement and not otherwise defined herein shall be used herein as defined in the Credit Agreement).

B.The Borrower has requested that the Lenders amend the Credit Agreement to (i) increase the Revolving Credit Facility to $200,000,000 pursuant to Section 2.14 of the Credit Agreement, and (ii) make certain other amendments thereto, as more fully set forth herein.
NOW, THEREFORE, in consideration of the covenants, conditions and agreements hereinafter set forth, and for other good and valuable consideration, the receipt and adequacy of which are all hereby acknowledged, the parties hereto covenant and agree as follows:
1.AMENDMENTS.  
(a)Section 1.01 of the Credit Agreement is hereby amended by adding the following defined terms thereto in proper alphabetical order:
“Eighth Amendment” means that certain Eighth Amendment and Commitment Increase to Credit Agreement, dated as of April 25, 2018, among the Borrower, the Lenders and the Administrative Agent.
“Eighth Amendment Effective Date” means the date that all conditions of effectiveness set forth in Section 4 of the Eighth Amendment have been satisfied.
(b)The definition of “Real Property Collateral” set forth in Section 1.01 of the Credit Agreement is hereby amended and restated to read as follows:

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“Real Property Collateral” means (a) all interests in real property owned by the Borrower or a Domestic Subsidiary that are listed on Schedule 1.01(a), excluding (i) any such real property or funeral homes disposed of for which no substitution is required pursuant to Section 7.05(e) and (ii) real property listed on Schedule 2 to the Eighth Amendment, (b) the Additional Real Property Collateral, and (c) additional real property substituted as Collateral in accordance with Section 7.05(e).
(c)The definition of “Revolving Credit Facility” set forth in Section 1.01 of the Credit Agreement is hereby amended by adding the following sentence at the end thereof to read as follows:
As of the Eighth Amendment Effective Date, the aggregate amount of the Revolving Credit Lenders’ Revolving Credit Commitments is $200,000,000.
(d)Section 2.05(b)(ii) of the Credit Agreement is hereby amended to add the following sentence at the end thereof to read as follows:
For the avoidance of doubt, the sale or issuance by the Borrower of its Equity Interests in exchange for the retirement, purchase, prepayment or redemption of any Debt, is not considered to constitute the receipt of cash or Net Cash Proceeds by the Borrower. 
(e)Section 2.14(a) of the Credit Agreement is hereby amended by amending the first sentence thereof to read as follows:
Provided there exists no Default, upon notice to the Administrative Agent (which shall promptly notify the Lenders), the Borrower may from time to time, request (x) an increase in the Revolving Credit Facility (each, an “Incremental Revolving Commitment”) and/or (y) the establishment of one or more new term loan commitments or an increase in the existing Term Loans (each, an “Incremental Term Commitment”), by an amount (for all such requests) not exceeding $25,000,000 after the Eighth Amendment Effective Date; provided that (i) any such request for an increase shall be in a minimum amount of $10,000,000; and (ii) the Borrower may make a maximum of two (2) such requests after the Eighth Amendment Effective Date.
(f)Article III of the Credit Agreement is hereby amended by adding a new Section 3.08 at the end thereof to read as follows:

3.08     LIBOR Successor Provision.  Notwithstanding anything to the contrary in this Agreement or any other Loan Documents, if the Administrative Agent determines (which determination shall be conclusive absent manifest error), or the Borrower or Required Lenders notify the Administrative Agent (with, in the case of the Required Lenders, a copy to Borrower) that the Borrower or Required Lenders (as applicable) have determined, that:

(a)adequate and reasonable means do not exist for ascertaining LIBOR 

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for any requested Interest Period, including, without limitation, because the LIBOR Screen Rate is not available or published on a current basis and such circumstances are unlikely to be temporary; or 
(b)the administrator of the LIBOR Screen Rate or a Governmental Authority having jurisdiction over the Administrative Agent has made a public statement identifying a specific date after which LIBOR or the LIBOR Screen Rate shall no longer be made available, or used for determining the interest rate of loans (such specific date, the “Scheduled Unavailability Date”), or
(c)syndicated loans currently being executed, or that include language similar to that contained in this Section, are being executed or amended (as applicable) to incorporate or adopt a new benchmark interest rate to replace LIBOR, 

then, reasonably promptly after such determination by the Administrative Agent or receipt by the Administrative Agent of such notice, as applicable, the Administrative Agent and the Borrower may amend this Agreement to replace LIBOR with an alternate benchmark rate (including any mathematical or other adjustments to the benchmark (if any) incorporated therein), giving due consideration to any evolving or then existing convention for similar U.S. dollar denominated syndicated credit facilities for such alternative benchmarks (any such proposed rate, a “LIBOR Successor Rate”), together with any proposed LIBOR Successor Rate Conforming Changes (as defined below) and any such amendment shall become effective at 5:00 p.m. (Dallas, Texas time) on the fifth Business Day after the Administrative Agent shall have posted such proposed amendment to all Lenders and the Borrower unless, prior to such time, Lenders comprising the Required Lenders have delivered to the Administrative Agent written notice that such Required Lenders do not accept such amendment.  
If no LIBOR Successor Rate has been determined and the circumstances under clause (a) above exist or the Scheduled Unavailability Date has occurred (as applicable), the Administrative Agent will promptly so notify the Borrower and each Lender.  Thereafter, (i) the obligation of the Lenders to make or maintain Eurodollar Rate Loans shall be suspended, (to the extent of the affected Eurodollar Rate Loans or Interest Periods), and (ii) the Eurodollar Rate component shall no longer be utilized in determining the Base Rate.  Upon receipt of such notice, the Borrower may revoke any pending request for a Borrowing of, conversion to or continuation of Eurodollar Rate Loans (to the extent of the affected Eurodollar Rate Loans or Interest Periods) or, failing that, will be deemed to have converted such request into a request for a Borrowing of Base Rate Loans (subject to the foregoing clause (ii)) in the amount specified therein.
Notwithstanding anything else herein, any definition of LIBOR Successor Rate shall provide that in no event shall such LIBOR Successor Rate be less than zero for purposes of this Agreement.
As used above: 

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“LIBOR Screen Rate” means the LIBOR quote on the applicable screen page the Administrative Agent designates to determine LIBOR (or such other commercially available source providing such quotations as may be designated by the Administrative Agent from time to time).
“LIBOR Successor Rate Conforming Changes” means, with respect to any proposed LIBOR Successor Rate, any conforming changes to the definition of Base Rate, Interest Period, timing and frequency of determining rates and making payments of interest and other administrative matters as may be appropriate, in the discretion of the Administrative Agent, to reflect the adoption of such LIBOR Successor Rate and to permit the administration thereof by the Administrative Agent in a manner substantially consistent with market practice (or, if the Administrative Agent determines that adoption of any portion of such market practice is not administratively feasible or that no market practice for the administration of such LIBOR Successor Rate exists, in such other manner of administration as the Administrative Agent determines in consultation with the Borrower).  
(g)Section 6.11 of the Credit Agreement is hereby amended by amending the first sentence thereof to read as follows:

6.11    Use of Proceeds.  The Borrower shall use the proceeds of the Credit Extensions (a) to repay certain indebtedness, (b) for working capital and Acquisitions, (c) to make certain Capital Expenditures, (d) to pay the accrued interest on the Subordinated Debt and Refinancing Subordinated Debt, (e) for general corporate purposes not in contravention of any Law or of any Loan Document and (f) to prepay, repay, purchase or redeem all or any portion of Subordinated Debt and Refinancing Subordinated Debt (including, but not limited to principal amounts).
(h)Article VI of the Credit Agreement is hereby amended by adding a new Section 6.20 at the end thereof to read as follows:

6.20    Eighth Amendment Post-Closing Requirements.  Execute and deliver the documents and complete the tasks set forth on Schedule 6.20, in each case within the time limits specified on such Schedule.
(i)Section 7.06(a)(iv) of the Credit Agreement is hereby amended to read as follows:
(iv)    so long as there exists no Default both before and after giving effect to any such transaction (which shall include calculation of the financial covenants set forth in Section 7.11 on a pro forma basis as of the fiscal quarter-end immediately preceding any proposed Restricted Payment), the Borrower may (A) make regularly scheduled payments of principal and interest on (i) Subordinated Debt within the terms specified in the definition of Subordinated Debt as set forth in this Agreement, and (ii) Refinancing Subordinated Debt within the terms specified in the definition of Refinancing Subordinated Debt as set forth in this Agreement, (B) make cash payments required to be made upon conversion of Subordinated Debt, provided that 

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(x) with respect to the conversion of Subordinated Debt, such cash payments are made solely with the proceeds of Refinancing Subordinated Debt, (y) immediately after giving pro-forma effect to the making of such cash payments, (i) the Leverage Ratio on a pro-forma basis is less than or equal to 3.25 to 1.00 and (ii) Liquidity is at least $15,000,000 or (z) the Borrower may make up to $3,000,000 in cash payments required to be made upon conversion of Subordinated Debt so long as immediately after giving pro-forma effect to the making of such cash payments Liquidity is at least $15,000,000 and (C) prepay, repay, purchase or redeem all or a portion of the Subordinated Debt in cash with the proceeds of Revolving Credit Loans, provided that after giving pro-forma effect to each such cash payment (x) Liquidity is at least $10,000,000 and (y) the Senior Secured Leverage Ratio is at least 0.25 less than the then maximum Senior Secured Leverage Ratio set forth in Section 7.11(a).
(j)Section 7.11(a) of the Credit Agreement is hereby amended to read as follows:
(a)    Maximum Senior Secured Leverage Ratio.  Permit the Senior Secured Leverage Ratio as of the end of any period of four consecutive Fiscal Quarters of the Borrower set forth below to be greater than the ratio opposite such period:
	
		
	Period
	Maximum Senior Secured Leverage Ratio

	Eighth Amendment Effective Date through June 30, 2018
	4.50 to 1.00

	September 30, 2018 
	4.25 to 1.00

	December 31, 2018 
	4.00 to 1.00

	March 31, 2019 
	3.75 to 1.00

	June 30, 2019 and thereafter 
	3.50 to 1.00

(k)Article X of the Credit Agreement is hereby amended by adding a new Section 10.23 to the end thereof to read as follows:
10.23    Lender ERISA Representations.  Each Lender as of the Eighth Amendment Effective Date represents and warrants as of the Eighth Amendment Effective Date to the Administrative Agent and the Arrangers and their respective Affiliates, and not, for the avoidance of doubt, for the benefit of the Borrower or any other Loan Party, that such Lender is not and will not be (a) an employee benefit plan subject to Title I of ERISA; (b) a plan or account subject to Section 4975 of the Code; (c) an entity deemed to hold “plan assets” of any such plans or accounts for purposes of ERISA or the Code; or (d) a “governmental plan” within the meaning of ERISA.
(l)Schedule 1.01(a) of the Credit Agreement is hereby amended to be in the form of Schedule 1.01(a) to this Eighth Amendment.

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(m)Schedule 2.01 of the Credit Agreement is hereby amended to be in the form of Schedule 2.01 to this Eighth Amendment, and the Revolving Credit Commitment of each Lender is hereby amended as set forth therein and the Applicable Percentage of each Lender is hereby amended as set forth therein.

(n)Schedule 6.20 of the Credit Agreement is hereby added to the Credit Agreement in the form of Schedule 6.20 to this Eighth Amendment.

(o)Exhibit D, the Compliance Certificate, is hereby amended to be in the form of Exhibit D to this Eighth Amendment.

(p)Exhibit E-1, the Assignment and Assumption, is hereby amended to be in the form of Exhibit E-1 to this Eighth Amendment.

2.RELEASE OF CERTAIN COLLATERAL.  By signing below, each Lender hereby agrees to the release as Collateral for the Obligations each of the Mortgaged Properties located in a flood plain and which are listed on Schedule 2 attached hereto.

3.REPRESENTATIONS AND WARRANTIES TRUE; NO EVENT OF DEFAULT.  By its execution and delivery hereof, the Borrower represents and warrants that, as of the date hereof, and both before and immediately after giving effect to this Eighth Amendment:
(a)the representations and warranties contained in the Credit Agreement and the other Loan Documents that are subject to materiality or Material Adverse Effect qualifications are true and correct in all respects on and as of the date hereof as made on and as of such date, and the representations and warranties contained in the Credit Agreement and the other Loan Documents that are not subject to materiality or Material Adverse Effect qualifications are true and correct in all material respects on and as of the date hereof as made on and as of such date, except in each case to the extent that such representations and warranties specifically refer to an earlier date, in which case they shall be true and correct as of such earlier date, and except that the representations and warranties contained in Sections 5.05(a) and (b) of the Credit Agreement shall be deemed to refer to the most recent financial statements furnished pursuant to Sections 6.01(a) and (b), respectively, of the Credit Agreement;
(b)no event has occurred and is continuing which constitutes a Default or Event of Default;
(c)(i) the Borrower has full power and authority to execute and deliver this Eighth Amendment, each Revolving Credit Note in the amount of each Lender’s Revolving Credit Commitment after giving effect to this Eighth Amendment (the “New Revolving Loan Notes”), (ii) this Eighth Amendment and the New Revolving Loan Notes have been duly executed and delivered by the Borrower and (iii) this Eighth Amendment, the New Revolving Loan Notes and the Credit Agreement, as amended hereby, constitute the legal, valid and binding obligations of the Borrower, enforceable in accordance with their respective terms, except as enforceability may be limited by applicable Debtor Relief Laws and by general principles of equity (regardless of whether enforcement is sought in a proceeding in equity or at law) and except as rights to indemnity may be limited by federal or state securities laws;

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(d)neither the execution, delivery and performance of this Eighth Amendment, the New Revolving Loan Notes or the Credit Agreement, as amended hereby, nor the consummation of any transactions contemplated herein or therein, will conflict with (i) any Organization Documents of the Borrower or its Subsidiaries, (ii) to Borrower’s knowledge, any Law applicable to the Borrower or its Subsidiaries or (iii) any indenture, agreement or other instrument to which the Borrower, the Subsidiaries or any of their respective properties are subject; and

(e)no authorization, approval, consent, or other action by, notice to, or filing with, any Governmental Authority or other Person not previously obtained is required to be obtained or made by the Borrower pursuant to statutory law applicable to the Borrower as a condition to (i) the execution, delivery or performance by the Borrower of this Eighth Amendment and the New Revolving Loan Notes or (ii) the acknowledgement by each Guarantor of this Eighth Amendment.

4.CONDITIONS OF EFFECTIVENESS.  All provisions of this Eighth Amendment shall be effective upon satisfaction of, or completion of, the following:

(a)the Administrative Agent shall have received counterparts of this Eighth Amendment executed by the Borrower, the Required Lenders, each Lender that is increasing its Revolving Credit Commitment and acknowledged by each Guarantor;

(b)the representations and warranties set forth in Section 3 of this Eighth Amendment shall be true and correct; 

(c)the Administrative Agent shall have received a certified resolution of the Borrower authorizing the execution, delivery and performance of this Eighth Amendment, the New Revolving Loan Notes, and the related documents required to be executed and delivered pursuant to Schedule 6.20 to this Eighth Amendment, together with a Certificate of Incumbency;

(d)the Administrative Agent shall have received a favorable opinion of counsel to the Borrower covering the matters set forth in Sections 3(c), (d) and (e) of this Eighth Amendment;

(e)to the extent requested by a Lender, the Administrative Agent shall have received a fully-executed New Revolving Loan Note for each such Lender;

(f)the Administrative Agent shall have received for its benefit and for the benefit of each Lender the consent fees in immediately available funds as agreed upon by the Borrower, the Arranger, the Administrative Agent and the Lenders;

(g)since December 31, 2017, there shall not have occurred any event or condition that has had or could reasonably be expected to have, either individually or in the aggregate, a Material Adverse Effect; and

(h)the Administrative Agent shall have received updated flood certificates (and where necessary, verification of flood insurance) with respect to the Real Property Collateral; 

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(i)the Administrative Agent shall have executed releases for those Mortgaged Properties listed on Schedule 2 hereto that are located in a flood plain; and

(j)the Administrative Agent shall have received, in form and substance satisfactory to the Administrative Agent and its counsel, such other documents, certificates and instruments as the Administrative Agent shall reasonably require.

5.PURCHASE/SALE BY LENDERS.  Simultaneously with the satisfaction of the conditions to effectiveness set forth in Section 4 of this Eighth Amendment, each Lender shall purchase or sell (as the case may be), without recourse, an amount of the Revolving Credit Loans outstanding such that, after giving effect to this Eighth Amendment, the amount of each Lender’s Revolving Credit Commitment utilized and the amount of Revolving Loans owed to each Lender will be equal to its Applicable Percentage thereof after giving effect to the Eighth Amendment.  The Borrower shall pay each Lender compensation for any losses pursuant to and in accordance with the provisions of Section 3.05 of the Credit Agreement as a result of any purchases or sales.

6.LIMITED WAIVER.  The Lenders hereby waive any Default or Event of Default that may have occurred as a result of the Borrower’s failure to deliver prior written notice of the name change of Carriage Merger VIII, Inc. to PNCA, Inc.
7.GUARANTORS’ ACKNOWLEDGMENT.  By signing below, each Guarantor (a) acknowledges, consents and agrees to the execution, delivery and performance by the Borrower of this Eighth Amendment, (b) acknowledges and agrees that its obligations in respect of its Guaranty (i) are not released, diminished, waived, modified, impaired or affected in any manner by this Eighth Amendment or any of the provisions contemplated herein, and (ii) include the Revolving Credit Facility, as increased by this Eighth Amendment, (c) ratifies and confirms its obligations under its Guaranty, and (d) acknowledges and agrees that it has no claim or offsets against, or defenses our counterclaims to, its Guaranty.
8.REFERENCE TO THE CREDIT AGREEMENT.
(a)Upon and during the effectiveness of this Eighth Amendment, each reference in the Credit Agreement to “this Agreement”, “hereunder”, or words of like import shall mean and be a reference to the Credit Agreement, as affected and amended by this Eighth Amendment
(b)Except as expressly set forth herein, this Eighth Amendment shall not by implication or otherwise limit, impair, constitute a waiver of, or otherwise affect the rights or remedies of the Administrative Agent or the Lenders under the Credit Agreement or any of the other Loan Documents, and shall not alter, modify, amend, or in any way affect the terms, conditions, obligations, covenants, or agreements contained in the Credit Agreement or the other Loan Documents, all of which are hereby ratified and affirmed in all respects and shall continue in full force and effect.
9.COSTS AND EXPENSES.  The Borrower shall be obligated to pay the reasonable out-of-pocket costs and expenses of the Administrative Agent in connection with the preparation, reproduction, execution and delivery of this Eighth Amendment and the other instruments and documents to be delivered hereunder.

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10.EXECUTION IN COUNTERPARTS.  This Eighth Amendment may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which when so executed and delivered shall be deemed to be an original and all of which when taken together shall constitute but one and the same instrument.  For purposes of this Eighth Amendment, a counterpart hereof (or signature page thereto) signed and transmitted by any Person party hereto to the Administrative Agent (or its counsel) by facsimile or other electronic imaging means (e.g., “pdf” or “tif”) is to be treated as an original.  The signature of such Person thereon, for purposes hereof, is to be considered as an original signature, and the counterpart (or signature page thereto) so transmitted is to be considered to have the same binding effect as an original signature on an original document.
11.GOVERNING LAW; BINDING EFFECT.  This Eighth Amendment shall be governed by and construed in accordance with the laws of the State of Texas applicable to agreements made and to be performed entirely within such state; provided that each party shall retain all rights arising under federal law.  This Eighth Amendment shall be binding upon the Borrower, the Guarantors, the Administrative Agent and each Lender and their respective successors and permitted assigns.
12.HEADINGS.  Section headings in this Eighth Amendment are included herein for convenience of reference only and shall not constitute a part of this Eighth Amendment for any other purpose.
13.ENTIRE AGREEMENT.  THE CREDIT AGREEMENT, AS AMENDED BY THIS EIGHTH AMENDMENT, AND THE OTHER LOAN DOCUMENTS REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES AS TO THE SUBJECT MATTER THEREIN AND HEREIN AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS BETWEEN THE PARTIES.
	
	
	REMAINDER OF PAGE LEFT INTENTIONALLY BLANK

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IN WITNESS WHEREOF, the parties hereto have executed this Eighth Amendment as of the date above written.

CARRIAGE SERVICES, INC.

By:      /s/  Carl Benjamin Brink            
Carl Benjamin Brink
Senior Vice President, Chief Financial Officer and Treasurer

Signature Page - Eighth Amendment

	
		
	ADMINISTRATIVE AGENT:
	BANK OF AMERICA, N.A.,
as Administrative Agent

By:/s/  Steven Gazzillo
Name:Steven Gazzillo
Title:Vice President

Signature Page - Eighth Amendment

	
		
	 
	BANK OF AMERICA, N.A.,
as a Lender, L/C Issuer and Swing Line Lender

By:/s/  Adam Rose
Name:Adam Rose
Title:Senior Vice President

Signature Page - Eighth Amendment

	
		
	 
	RAYMOND JAMES BANK, N.A.,
as a Lender and Co-Syndication Agent

By:/s/  Daniel Gendron
Name:Daniel Gendron
Title:Vice President

Signature Page - Eighth Amendment

	
		
	 
	REGIONS BANK,
as a Lender and Co-Syndication Agent

By:/s/  Adam S. Muhib
Name:Adam S. Muhib
Title:Director

Signature Page - Eighth Amendment

	
		
	 
	ZB, N.A. dba Amegy Bank, as a Lender and Co-Syndication Agent

By:/s/  Lauren Eller
Name:Lauren Eller
Title:Vice President

Signature Page - Eighth Amendment

	
		
	 
	CADENCE BANK, N.A.,
as a Lender 

By:/s/  Ross L. Vaughan
Name:Ross L. Vaughan
Title:Executive Vice President

Signature Page - Eighth Amendment

	
		
	 
	COMPASS BANK,
as a Lender 

By:/s/  Frank Carvelli
Name:Frank Carvelli
Title:Senior Vice President

Signature Page - Eighth Amendment

	
		
	 
	BOKF, NA dba BANK OF TEXAS,
as a Lender 

By:/s/  Faith Allen
Name:Faith Allen
Title:Senior Vice President

Signature Page - Eighth Amendment

	
		
	 
	WHITNEY BANK,
as a Lender 

By:/s/  Katie Sandoval
Name:Katie Sandoval
Title:SVP

Signature Page - Eighth Amendment

	
		
	 
	TEXAS CAPITAL BANK, NATIONAL ASSOCIATION,
as a Lender 

By:/s/  John Kallina
Name:John Kallina
Title:SVP

Signature Page - Eighth Amendment

RATIFICATION OF GUARANTORS
Each of the undersigned Guarantors hereby (a) acknowledges and consents to the foregoing Eighth Amendment and the Borrower’s execution, delivery and performance thereof; (b) joins the foregoing Eighth Amendment for the purpose of consenting to and being bound by the provisions thereof; (c) acknowledges and agrees that its obligations in respect of its Guaranty are not released, diminished, waived, modified, impaired or affected in any manner by this Eighth Amendment or any of the provisions contemplated herein and cover the Commitments and Loans as increased by this Eighth Amendment; (d) ratifies and confirms all of its obligations and liabilities under the Loan Documents to which it is a party and ratifies and confirms that such obligations and liabilities extend to and continue in effect with respect to, and continue to guarantee and secure the Obligations of the Borrower under the Credit Agreement, as amended pursuant to the terms of the Eighth Amendment; (e) acknowledges and agrees that such Guarantor does not have any claim or cause of action against the Administrative Agent or any Lender (or any of their respective directors, officers, employees, agents, attorneys or other representatives) under or in connection with the Credit Agreement and the other Loan Documents; and (f) acknowledges, affirms and agrees that such Guarantor does not have any defense, claim, cause of action, counterclaim, offset or right of recoupment of any kind or nature against any of its obligations, indebtedness or liabilities to the Administrative Agent or any Lender, in each case under or in connection with the Credit Agreement and the other Loan Documents.  
The Guarantors: 

Carriage Cemetery Services, Inc.
Carriage Cemetery Services of     California, Inc.
Carriage Cemetery Services of Idaho,     Inc.
Carriage Florida Holdings, Inc.
Carriage Funeral Holdings, Inc.
Carriage Funeral Management, Inc.
Carriage Funeral Services of     California, Inc.
Carriage Funeral Services of     Kentucky, Inc.
Carriage Funeral Services of     Michigan, Inc.
Carriage Holding Company, Inc.
Carriage Insurance Agency of     Massachusetts, Inc.
Carriage Internet Strategies, Inc.
Carriage Life Events, Inc.
CARRIAGE MANAGEMENT, INC. (formerly     Carriage Management, L.P.)
Carriage Merger VI, Inc.
CSRE HOLDINGS, INC.

Signature Page - Eighth Amendment

PNCA, Inc. (formerly Carriage Merger VIII, Inc.)
carriage operations, Inc. (formerly Carriage Merger IX, Inc.)
Carriage services of tennessee, inc.
(formerly Carriage Merger X, Inc.)
Carriage Municipal Cemetery     Services of Nevada, Inc.
Carriage Pennsylvania Holdings, Inc.
Carriage Services of Connecticut,     Inc.
Carriage Services of Nevada, Inc.
Carriage Services of New Mexico, Inc.
Carriage Services of Ohio, LLC
Carriage Services of Oklahoma, L.L.C.
Carriage Team California     (Cemetery), LLC
Carriage Team California (Funeral),     LLC
Carriage Team Florida (Cemetery),     LLC
Carriage Team Florida (Funeral), LLC
Carriage Team Kansas, LLC
Cataudella Funeral Home, Inc.
CFS Funeral Services, Inc.
CHC Insurance Agency of Ohio, Inc.
Cloverdale Park, Inc.
Cochrane’s Chapel of the Roses, Inc.
CSI Funeral Services of     Massachusetts, Inc.
Forastiere Family Funeral Service,     Inc.
Horizon Cremation Society, Inc.
Hubbard Funeral Home, Inc.
Rolling Hills Memorial Park
Wilson & Kratzer Mortuaries
CARRIAGE SERVICES OF LOUISIANA, INC.

By:    /s/  Carl Benjamin Brink            
Carl Benjamin Brink
Treasurer for all

Signature Page - Eighth Amendment

Schedule 2
Properties to be Released
See attached.

Schedule 2

Schedule 2
Properties to be Released

	
							
	State
	County/Parrish
	Location Name
	Street Address
	City, State
	Zip Codes
	 

	 CALIFORNIA
	 
	Connolly & Taylor Chapel
	4000 Alhambra Ave.
	Martinez, CA
	94553
	 

	 
	Ventura
	Conejo Mountain Funeral Home
	2052 Howard Road
	Camarillo, CA
	93012

	 MICHIGAN
	 
	Bagnasco & Calcaterra Funeral Home (Sterling Heights)
	Tract III:  13650 Fifteen Mile Road
	Sterling Heights, MI
	48312
	 

	 NEW JERSEY
	 
	Bedle Funeral Home - Keyport
	Parcel 2:  61 Broad Street
	Keyport, NJ
	07735
	 

	 RHODE ISLAND
	Bristol
	Sansone Funeral Home
	192 Wood Street
	Bristol, RI
	02809
	 

	 
	 Washington
	Buckler-Johnston Funeral Home
	Parcel 2:  121 Main Street
	Westerly, RI
	 
	 

	 TEXAS
	Cameron
	Buck Ashcraft Funeral Home
	710 North Ed Carey Drive
	Harlingen, TX
	02891
	 

	 
	Potter
	LaGrone-Blackburn-Shaw Funeral Directors
	1505 Martin Road 
	Amarillo, TX
	79107

Schedule 2

SCHEDULE 1.01(a)
Mortgaged Properties
See attached.

Schedule 1.01(a)

	
								
	Schedule 1.01(a) - Mortgaged Property
	 

	State
	County/Parrish
	Location Name
	Street Address
	City, State
	Zip Codes
	 

	 
	 
	 
	 
	 
	 
	 

	 CALIFORNIA
	Alameda  
	Grant-Miller John Cox Mortuary
	2850 Telegraph Avenue
	Oakland, CA
	94609
	 

	 
	Colusa  
	McNary-Moore Funeral Service
	107 Fifth Street
	Colusa, CA  
	95932-2408
	 

	 
	Contra Costa  
	Ouimet Brothers Concord Funeral Chapel
	4125 Clayton Road
	Concord, CA
	94521-2618
	 

	 
	Contra Costa   
	Higgins Mortuary
	1310 A Street
	Antioch, CA
	94509-2329
	 

	 
	 
	Hosselkus Chapel
	1 Rolph Park Drive
	Crockett, CA
	94525-1415
	 

	 
	 
	Wilson & Kratzer Chapel of San Ramon Valley
	825 Hartz Way
	Danville, CA
	94526-3418
	 

	 
	 
	Wilson & Kratzer Civic Center Chapel
	455 24th Street
	Richmond, CA
	94804-1650
	 

	 
	 
	Wilson & Kratzer Mission Bells Chapel
	13644 San Pablo Ave.
	San Pablo, CA
	94806-3806
	 

	 
	Los Angeles  
	White’s Funeral Home
	404 E. Foothill Blvd
	Azusa, CA
	91702-2517
	 

	 
	Riverside
	Hemet Valley Mortuary
	403 N. San Jacinto St.
	Hemet, CA
	92543
	 

	 
	 
	Evans-Brown Mortuary (Lake Elsinore)
	126 E. Graham Ave.
	Lake Elsinore, CA
	92530-4168
	 

	 
	 
	Evans-Brown Mortuary (Perris)
	385 W. Fourth Street
	Perris, CA
	92570-2012
	 

	 
	 
	Evans-Brown Hemet Valley Crematory
	41725 Elm St., Unit 28
	Murrieta, CA
	92562-1414
	 

	 
	San Joaquin
	Deegan Funeral Chapel
	1441 San Joaquin St.
	Escalon, CA  
	95320-1738
	 

	 
	 
	P.L. Fry & Son
	290 N. Union Road
	Manteca, CA
	95337-4309
	 

	 
	 
	Fry Memorial Chapel
	550 South Central Ave.
	Tracy, CA
	95376-4622
	 

	 
	Santa Clara
	Darling & Fischer Campbell Memorial Chapel
	231 E. Campbell Ave.
	Campbell, CA
	95008-2020
	 

	 
	 
	Darling & Fischer Chapel of the Hills
	615 N. Santa Cruz Ave.
	Los Gatos, CA
	95030-4334
	 

	 
	 
	Darling & Fischer Garden Chapel
	471 E. Santa Clara St.
	San Jose, CA
	95112-3516
	 

	CONNECTICUT
	Fairfield
	Redgate-Hennessy Funeral Service
	4 Gorham Place
	Trumbull, CT
	06611-4703
	 

	 
	Hartford
	Funk Funeral Home
	35 Bellevue Ave.
	Bristol, CT
	06010-5815
	 

	 
	 
	O'Brien Funeral Home
	24 Lincoln Ave.
	Bristol, CT
	06010-7001
	 

	 
	 
	Bailey Funeral Home
	48 Broad Street (includes 54 & 56 Broad St. and a portion of 21 Hamlin, which are parking and landscaping only)
	Plainville, CT
	06062
	 

	 
	Litchfield
	Lyons Funeral Home
	46 High Street
	Thomaston, CT
	06787-1513
	 

	 
	New Haven
	Bergin Funeral Home
	290 E. Main St
	Waterbury, CT
	06702-2307
	 

	 
	 
	Keenan Funeral Home
	238 Elm St. 
	West Haven, CT
	06516
	 

	 
	 
	Woodtick Memorial Funeral Home
	420 Woodtick Road
	Wolcott, CT
	06716-2827
	 

	IDAHO
	Ada
	Cloverdale Funeral Home
	1200 North Cloverdale Road
	Boise, ID
	 
	 

	 
	83713-7805
	 

	 
	Ada
	Relyea Funeral Chapel
	318 N. Latah Street
	Boise, ID
	83706-2628
	 

Schedule 1.01(a)

	
								
	 
	Canyon
	Dakan Funeral Chapel - Caldwell                                                    
	504 S. Kimball Ave. 
	Caldwell, ID
	83605
	 

	 
	 
	Dakan Funeral Chapel - Parma
	411 E Bates Ave
	Parma, ID
	83660
	 

	 
	 
	Alsip & Persons Funeral Chapel
	404 10th Ave. S (also 412, 416 & 420 10th Ave.).
	Nampa, ID
	83651
	 

	ILLINOIS
	Cook
	Lain-Sullivan Funeral Home
	50 Westwood Dr.
	Park Forest, IL
	60466-1419
	 

	 
	Kane
	Dieterle Memorial Home
	1120 S. Broadway
	Montgomery, IL
	60538-1345
	 

	KENTUCKY
	Christian
	Maddux-Fuqua-Hinton Funeral Home
	Parcel One:  700 Country Club Lane
	Hopkinsville, KY
	42240-1345
	 

	 
	 
	Maddux Funeral Home
	Parcel Two:  338 East Nashville Street
	Pembroke, KY
	42266
	 

	 
	Greenup
	Carman Funeral Home
	Parcels 1 & 2:  2301 Argillite Rd.
	Flatwoods, KY
	41139-1953
	 

	 
	 
	Roberson Funeral Home
	Parcels 3 & 4: 400 Main Street 
	South Shore, KY
	41175
	 

	 
	Todd
	Latham Funeral Home
	413 E. Main St.
	Elkton, KY
	42220
	 

	MASSACHUSETTS
	Berkshire
	Devanny-Condron Funeral Home
	Parcel I: 40 Maplewood Avenue (Funeral Home)
	Pittsfield, MA
	01201-4742
	 

	 
	 
	 
	Parcel II: 74 North Pearl St. (Parking lot)
	Pittsfield, MA
	01201
	 

	 
	 
	 
	Parcel III: 189 1/2 First Street (Former House - now parking lot)
	Pittsfield, MA
	01201
	 

	 
	 
	 
	Parcel IV: 189 1/2 First Street (Easterly border of former house)
	Pittsfield, MA
	01201
	 

	 
	Essex
	Cataudella Funeral Home
	Parcel 1 and 2: 126 Pleasant Valley St
	Methuen, MA
	01844-7204
	 

	 
	Hampden
	Colonial Forastiere Funeral Home
	Tract I:  985 Main Street
	Agawam, MA
	01001-2580
	 

	 
	 
	Brunelle Funeral Home
	Tract II:  811 Chicopee Street
	Chicopee, MA
	01013-2730
	 

	 
	 
	Tylunas Funeral Home
	Tract III:  159 Broadway St.
	Chicopee, MA
	01020-2618
	 

	 
	 
	Forastiere Smith Funeral Home
	Tract IV:  220 North Main St. 
	East Longmeadow, MA
	01028-1803
	 

	 
	 
	Messier Funeral Home
	Tract V:  1944 Northampton Street
	Holyoke, MA
	01040-3414
	 

	

	 
	Southwick Forastiere Funeral Home
	Tract VI:  624 College Highway
	Southwick, MA
	01077-9817

	 
	 
	Byron Keenan Funeral Home & Cremation Tribute Center
	Tract VII:  1858 Allen Street
	Springfield, MA
	01118-1820

	 
	 
	Forastiere Funeral Home
	Tract VIII:  45 Locust Street
	Springfield, MA
	01108-1005

Schedule 1.01(a)

	
								
	 
	 
	Hafey Funeral Service
	Tract IX:  494 Belmont Ave.
	Springfield, MA
	01108-1753

	 
	 
	Ratell Funeral Home
	Tract X:  200 Main Street
	Indian Orchard, MA
	01151-1132

	LOUISIANA
	Jefferson
	Garden of Memories Funeral Home
	4900 Airline Drive
	Metairie, LA
	70001-5655

	 
	Jefferson
	Tharp-Sontheimer-Tharp Funeral Home
	1600 North Causeway Blvd.
	Metairie, LA
	70001-4141

	MICHIGAN
	Macomb
	Bagnasco & Calcaterra Funeral Home (St. Clair Shores)
	Tract II:  25800 Harper Ave.
	St. Clair Shores, MI
	48081-2212 

	MONTANA
	Flathead
	Johnson-Gloschat Funeral Home & Crematory
	525 South Main St.
	Kalispell, MT
	59901-4850

	NEW JERSEY
	Monmouth 
	Braun Funeral Home - Eatonton
	Parcel 1:  106 Broad Street
	Eatontown, NJ
	07724-1518

	 
	 
	Bedle Funeral Home - Matawan
	Parcel 3:  212 Main Street
	Matawan, NJ
	07747-3104

	 
	 
	John E. Day Funeral Home
	Parcel 4:  85 Riverside Ave.
	Red Bank, NJ
	07701-1007

	NEW YORK
	Suffolk 
	Bryant Funeral Home
	411 Old Town Road
	East Setauket, Town of Brookhaven, NY
	11733-3498

	 
	Nassau
	Donohue-Cecere Funeral Home
	290 Post Ave.
	Westbury, NY
	11590-2230

	NORTH CAROLINA
	Randolph
	Cumby Family Funeral Service - Archdale
	206 Trindale Rd. (includes a portion of 3405 Archdale Rd., which is parking lot only)
	Archdale, NC
	27263-2750

	 
	Guilford
	Cumby Family Funeral Service - High Point
	1015 Eastchester Dr. (includes 1013 Eastchester, which does not have a building on it)
	High Point, NC
	27262-7643

	OHIO
	Butler 
	Baker-Stevens-Parramore Funeral Home
	1500 Manchester Ave.
	Middleton, OH
	45042-2029

	 
	Fairfield
	Dwayne Spence Funeral Home (Pickerington)
	550 Hill Road N
	Pickerington, OH
	43147-8842

	 
	Franklin
	Dwayne Spence Funeral Home (Canal Winchester)
	650 W. Waterloo St.
	Canal Winchester, OH
	43110-1021

	 
	Muskingum
	Bryan & Snider Funeral Home
	2318 Maple Ave
	Zanesville, OH
	43701-2029

	OKLAHOMA
	Cleveland
	Resthaven Funeral Home
	500 SW 104th St.
	Oklahoma City, OK
	73139

	 
	Comanche
	Lawton Ritter Gray Funeral Home
	632 SW C Ave
	Lawton, OK
	73501

	 
	Stephens
	Don Grantham Funeral Home
	1502 N Highway 81
	Duncan, OK
	73533

	PENNSYLVANIA
	Chester
	James J. Terry Funeral Home
	736 E. Lancaster Ave.
	Downingtown, PA
	19335-2720

	RHODE ISLAND
	Providence
	Mariani & Son Funeral Home
	200 Hawkins Street
	Providence, RI
	02904-2216

	 
	Washington
	Avery Funeral Home
	Parcel 1:  3A Bank Street
	Hope Valley, RI
	02832

	TENNESSEE
	Hamilton
	Lane Funeral Home (Coulter Chapel)
	Tract 1:  601 Ashland Terrace
	Chattanooga, TN
	37415-3533

	 
	 
	Williamson & Sons Funeral Home
	Tract 2:  8852 Dayton Pike
	Soddy Daisy, TN
	37379-4324

	 
	Hamilton 
	Heritage Funeral Home & Cremation Services
	7454 E. Brainerd Rd.
	Chattanooga, TN
	37421-3163

Schedule 1.01(a)

	
								
	TEXAS
	Brazos
	Hillier Funeral Home
	2301 E. 29th Street (and additional 2 acre site)
	Bryan, TX
	77802-1906

	 
	Chambers
	Sterling Funeral Home (Anahuac)
	1201 South Main Street
	Anahuac, TX
	77514

	 
	Harrison
	Sullivan Funeral Home
	100 E. Travis Street
	Marshall, TX
	75670-4165

	 
	Hidalgo
	Ceballos-Diaz Funeral Home
	322 East Kuhn St.
	Edinburg, TX
	78541-3532

	 
	Liberty
	Sterling Funeral Home (Dayton)
	Parcel 1:  602  N Main Street
	Dayton, TX
	77535-2227

	 
	 
	Allison Funeral Service
	Parcel 2:  1101 N. Travis St.
	Liberty, TX
	77575-3537

	 
	Nueces
	Corpus Christi Funeral Home
	Parcel 1:  2409 Baldwin Blvd.
	Corpus Christi, TX
	78405-2013

	 
	 
	Seaside Funeral Home
	Parcel 2:  4357 Ocean Dr.
	Corpus Christi, TX
	78412-2532

	 
	Potter
	Angel Funeral Home
	Parcel 1:  2209 S. Arthur Street
	Amarillo, TX
	79103-1117

	 
	Randall
	La-Grone-Blackburn-Shaw Funeral Directors - Coulter Chapel
	Parcel 1:  8310 S. Coulter St.
	Amarillo, TX
	79119-7389

	 
	 
	Schooler Funeral Home
	Parcel 2:  4100 S. Georgia St.
	Amarillo, TX
	79110-1124

	 
	Cameron
	San Benito Funeral Home
	1400 W US Hwy 77
	San Benito, TX
	78586-4104

	 
	Harris
	Schmidt Funeral Home
	1508 East Ave.
	Katy, TX
	77493-1932

	 
	Harris
	Crespo & Jirrels Funeral and Cremation Services
	6123 Garth Rd.
	Baytown, TX
	77521-9685

	 
	Harris
	Sterling White Funeral Home
	11011 Crosby-Lynchburg Rd.
	Highlands, TX
	77562

Schedule 1.01(a)

SCHEDULE 2.01
Commitments and Applicable Percentages
	
					
	Lender
	Applicable Percentage in respect of the Revolving Credit Facility
	Revolving Credit Commitment
	Applicable Percentage in respect of the Term Facility
	Term Loan**
**As of the Eighth Amendment Effective Date

	Bank of America, N.A.
	22.000000000%
	$44,000,000.00
	18.769648283%
	$23,227,439.75

	Regions Bank
	17.230238695%
	$34,460,477.39
	15.383919596%
	$19,037,600.50

	Raymond James Bank, N.A.
	9.231030150%
	$18,462,060.30
	12.308040202%
	$15,231,199.75

	ZB, N.A. dba Amegy Bank
	12.308040200%
	$24,616,080.40
	12.308040202%
	$15,231,199.75

	Cadence Bank, N.A.
	10.769648240%
	$21,539,296.48
	10.769648218%
	$13,327,439.67

	Compass Bank
	12.307927135%
	$24,615,854.27
	10.461608016%
	$12,946,239.92

	BOKF, NA dba Bank of Texas
	5.768969850%
	$11,537,939.70
	7.691959798%
	$9,518,800.25

	Whitney Bank
	5.768969850%
	$11,537,939.70
	7.691959798%
	$9,518,800.25

	Texas Capital Bank,
National Association
	4.615175880%
	$9,230,351.76
	4.615175887%
	$5,711,280.16

	Totals
	100.000000000%
	$200,000,000.00
	100.000000000%
	$123,750,000.00

Schedule 2.01

SCHEDULE 6.20
Eighth Amendment Post-Closing Requirements
1.    By the date which is 60 days after the Eighth Amendment Effective Date (or such later date as the Administrative Agent shall agree in its sole discretion), execute and deliver to the Administrative Agent amendments to Mortgages covering the Real Property Collateral to the extent determined by the Administrative Agent to be necessary as a result of the modifications to the terms of the Facilities pursuant to the Eighth Amendment.

Schedule 6.20

EXHIBIT D
FORM OF COMPLIANCE CERTIFICATE
Financial Statement Date:                     ,         
		
	To:
	Bank of America, N.A., as Administrative Agent  

Ladies and Gentlemen:
Reference is made to that certain Credit Agreement, dated as of August 30, 2012 (as amended, restated, extended, supplemented or otherwise modified in writing from time to time, the “Agreement;” the terms defined therein being used herein as therein defined), among Carriage Services, Inc., a Delaware corporation (the “Borrower”), the Lenders from time to time party thereto, and Bank of America, N.A., as Administrative Agent, L/C Issuer and Swing Line Lender.
The undersigned Responsible Officer hereby certifies as of the date hereof that he/she is the             ____________________________________________________ of the Borrower, and that, as such, he/she is authorized to execute and deliver this Certificate to the Administrative Agent on the behalf of the Borrower, and that:
[Use following paragraph 1 for fiscal year-end financial statements]
1.    Attached hereto as Schedule 1 are the year-end audited financial statements required by Section 6.01(a) of the Agreement for the fiscal year of the Borrower ended as of the above date, together with the report and opinion of an independent certified public accountant required by such section.
[Use following paragraph 1 for fiscal quarter-end financial statements]
1.    Attached hereto as Schedule 1 are the unaudited financial statements required by Section 6.01(b) of the Agreement for the fiscal quarter of the Borrower ended as of the above date.  Such financial statements fairly present the financial condition, results of operations and cash flows of the Borrower and its Subsidiaries in accordance with GAAP as at such date and for such period, subject only to normal year-end audit adjustments and the absence of footnotes.
2.    The undersigned has reviewed and is familiar with the terms of the Agreement and has made, or has caused to be made under his/her supervision, a detailed review of the transactions and condition (financial or otherwise) of the Borrower during the accounting period covered by the attached financial statements.
3.    A review of the activities of the Borrower during such fiscal period has been made under the supervision of the undersigned with a view to determining whether during such fiscal period the Borrower performed and observed all its Obligations under the Loan Documents, and 
[select one:]

Exhitbit D

[to the best knowledge of the undersigned during such fiscal period, the Borrower performed and observed each covenant and condition of the Loan Documents applicable to it.] 
--or--
[the following covenants or conditions have not been performed or observed and the following is a list of each such Default and its nature and status:]
4.    The representations and warranties of the Borrower contained in Article V of the Agreement, or which are contained in any document furnished at any time under or in connection with the Loan Documents, are true and correct on and as of the date hereof, except to the extent that such representations and warranties specifically refer to an earlier date, in which case they are true and correct as of such earlier date, and except that for purposes of this Compliance Certificate, the representations and warranties contained in subsections (a) and (b) of Section 5.05 of the Agreement shall be deemed to refer to the most recent statements furnished pursuant to clauses (a) and (b), respectively, of Section 6.01 of the Agreement, including the statements in connection with which this Compliance Certificate is delivered.
5.    The financial covenant analyses and information set forth on Schedule 2 attached hereto are true and accurate on and as of the date of this Certificate.
IN WITNESS WHEREOF, the undersigned has executed this Certificate on behalf of the Borrower as of _______________________,         .
CARRIAGE SERVICES, INC.

                        	
			
	By:
	 

	 
	Name:
	 

	 
	Title
	 

Exhitbit D

For the Quarter/Year ended ___________________(“Statement Date”)
SCHEDULE 2
to the Compliance Certificate
($ in 000’s)

	
								
	I.
	Section 7.01 - Liens.
	 

	 
	A.
	Debt on acquired Property:
	$_____________

	 
	B.
	Purchase money Liens and surety bond deposits:
	$_____________

	 
	C.
	Total permitted Secured Debt (Lines I.A. + I.B.):
	$_____________

	 
	D.
	10% of Borrower’s Net Worth:
	$_____________

	II.
	Section 7.02 - Investments.
	 

	 
	A.
	Investments made pursuant to Section 7.02(g):
	$_____________

	 
	B.
	Investments permitted pursuant to Section 7.02(g):
	$5,000,000

	 
	C.
	Investments in Unrestricted Subsidiaries pursuant to Section 7.02(j):
	$_____________

	 
	D.
	Investments permitted pursuant to Section 7.02(j):
	$10,000,000

	III.
	Section 7.11 (a) -  Maximum Senior Secured Leverage Ratio.
	 

	 
	A.
	Total Senior Secured Debt at Statement Date:
	 

	 
	 
	(1
	)
	Debt of the Borrower and its Subsidiaries at Statement Date:
	$_____________

	 
	 
	(2
	)
	Subordinated Debt of the Borrower and its Subsidiaries at Statement Date:
	$_____________

	 
	 
	(3
	)
	Refinancing Subordinated Debt of the Borrower and its Subsidiaries at Statement Date:
	$_____________

	 
	 
	(4
	)
	Debt of the Borrower and its Subsidiaries not secured by a Lien:
	$_____________

	 
	 
	(5
	)
	Total Senior Secured Debt (Lines (III.A.1) - (III.A.2 + 3 + 4)):
	$_____________

	 
	B.
	EBITDA for four consecutive fiscal quarters ending on the Statement Date (“Subject Period”):
	 

	 
	 
	(1
	)
	Net Income for the Subject Period:
	$_____________

	 
	 
	(2
	)
	To the extent deducted in calculating Net Income, Interest Expense for the Subject Period:
	$_____________

	 
	 
	(3
	)
	To the extent deducted in calculating Net Income, the provision for federal, state, local and foreign income taxes payable by the Borrower and its Subsidiaries for the Subject Period:
	$_____________

Exhitbit D

	
								
	 
	 
	(4
	)
	To the extent deducted in calculating Net Income, depreciation and amortization expenses and payments in respect of Deferred Purchase Price for the Subject Period:
	$_____________

	 
	 
	(5
	)
	To the extent deducted in calculating Net Income, other expenses of the Borrower and the Subsidiaries reducing Net Income which do not represent a cash item in the Subject Period or any future period:
	$_____________

	 
	 
	(6)
	

	To the extent deducted in calculating Net Income, non-recurring costs and expenses, including acquisition costs, of the Borrower and its Subsidiaries not to exceed $1,000,000 in aggregate amount:
	$_____________

	 
	 
	(7
	)
	Withdrawable trust income received by the Borrower and its Subsidiaries from preneed trust accounts that allow income to be withdrawn before contract maturity, less cash amounts required to be replaced, if any:
	$_____________

	 
	 
	(8
	)
	EBITDA of any Acquisition calculated on a historic basis for such Acquisition as if the same had occurred on the first day of the period for which such EBITDA is measured with such pro-forma adjustments as the Administrative Agent shall approve:
	$_____________

	 
	 
	(9
	)
	For any period of calculation, severance costs not to exceed $1,000,000 in aggregate amount.
	$_____________

	 
	 
	(10
	)
	Non-cash items increasing Net Income for the Subject Period:
	$_____________

	 
	 
	(11
	)
	EBITDA of any Subsidiary or business Disposed of calculated on a historic business as if the same had occurred on the first day of the period for which such EBITDA is measured with such pro-forma adjustments as the Administrative Agent shall approve:
	$_____________

	 
	 
	(12
	)
	EBITDA (Lines III.B.1 + 2 + 3 + 4 + 5 + 6 + 7 + 8 + 9 -10 - 11):
	$_____________

	 
	C.
	Senior Secured Leverage Ratio (Line III.A.5  Line III.B.12):
	_____ to ______

	 
	 
	Maximum permitted:
	 

        	
		
	Period
	Maximum Senior Secured Leverage Ratio

	Eighth Amendment Effective Date through June 30, 2018
	4.50 to 1.00

	September 30, 2018 
	4.25 to 1.00

	December 31, 2018 
	4.00 to 1.00

	March 31, 2019 
	3.75 to 1.00

	June 30, 2019 and thereafter 
	3.50 to 1.00

Exhitbit D

	
							
	IV.
	Section 7.11(b) - Minimum Fixed Charge Coverage Ratio.

	 
	A.
	EBITDA for the Subject Period (Line III.B.12. above):
	$_____________

	 
	B.
	Maintenance Capital Expenditures for the Subject Period:
	$_____________

	 
	C.
	Cash taxes paid during the Subject Period:
	$_____________

	 
	D.
	Cash tax refunds received during the Subject Period:
	$_____________

	 
	E.
	Dividends paid in cash during the Subject Period:
	$_____________

	 
	F.
	Cash Interest Expense during the Subject Period:
	$_____________

	 
	G.
	Scheduled and required principal payments during the Subject Period in respect of Debt: 
	$_____________

	 
	H.
	Scheduled and required payments made by the Borrower in respect of Deferred Purchase Price for the Subject Period (to extent not included in IV.E. and IV.F. above):
	$_____________

	 
	I.
	Fixed Charge Coverage Ratio (Lines IV.A. - IV.B. - IV.C. + IV.D. - IV.E.)  (Lines IV.F. + IV.G. + IV.H):
	______ to 1.00

	 
	 
	Minimum required:
	1.20 to 1.00

	 
	Section 6.12(d) - Field Level EBITDA

	 
	A.
	Funeral Field Level EBITDA for the Subject Period:
	$_____________

	 
	B.
	Line V.A x .50:
	$_____________

	 
	C.
	EBITDA generated by Mortgaged Property and related operations for the Subject Period:
	$_____________

Exhitbit D

EXHIBIT E-1
ASSIGNMENT AND ASSUMPTION

This Assignment and Assumption (this “Assignment and Assumption”) is dated as of the Effective Date set forth below and is entered into by and between the Assignor identified in item 1 below (the “Assignor”) and the Assignee identified in item 2 below (the “Assignee”).  Capitalized terms used but not defined herein shall have the meanings given to them in the Credit Agreement identified below (as amended, restated, amended and restated, extended, supplemented or otherwise modified in writing from time to time, the “Credit Agreement”), receipt of a copy of which is hereby acknowledged by the Assignee.  The Standard Terms and Conditions set forth in Annex 1 attached hereto are hereby agreed to and incorporated herein by reference and made a part of this Assignment and Assumption as if set forth herein in full.

For an agreed consideration, the Assignor hereby irrevocably sells and assigns to the Assignee, and the Assignee hereby irrevocably purchases and assumes from the Assignor, subject to and in accordance with the Standard Terms and Conditions and the Credit Agreement, as of the Effective Date inserted by the Administrative Agent as contemplated below (i) all of the Assignor’s rights and obligations in its capacity as a Lender under the Credit Agreement and any other documents or instruments delivered pursuant thereto to the extent related to the amount and percentage interest identified below of all of such outstanding rights and obligations of the Assignor under the respective facilities identified below (including, without limitation, the Swing Line Loans included in such facilities) and (ii) to the extent permitted to be assigned under applicable law, all claims, suits, causes of action and any other right of the Assignor (in its capacity as a Lender) against any Person, whether known or unknown, arising under or in connection with the Credit Agreement, any other documents or instruments delivered pursuant thereto or the loan transactions governed thereby or in any way based on or related to any of the foregoing, including, but not limited to, contract claims, tort claims, malpractice claims, statutory claims and all other claims at law or in equity related to the rights and obligations sold and assigned pursuant to clause (i) above (the rights and obligations sold and assigned by the Assignor to the Assignee pursuant to clauses (i) and (ii) above being referred to herein collectively as the “Assigned Interest”).  Each such sale and assignment is without recourse to the Assignor and, except as expressly provided in this Assignment and Assumption, without representation or warranty by the Assignor.
		
	1.
	Assignor:    ______________________________

______________________________
		
	2.
	Assignee:    ______________________________

______________________________
for each Assignee, indicate [Affiliate][Approved Fund] of [identify Lender]]
		
	3.
	Borrower:    Carriage Services, Inc.

		
	4.
	Administrative Agent:  Bank of America, N.A., as the administrative agent under the Credit Agreement

Schedule E-1

		
	5.
	Credit Agreement:  Credit Agreement, dated as of August 30, 2012, among the Borrower, the Lenders from time to time party thereto, and Bank of America, N.A., as Administrative Agent, Swing Line Lender and L/C Issuer

		
	6.
	Assigned Interest: 

	
							
	Assignor
	Assignee
	

Facility
Assigned1
	Aggregate
Amount of
Commitment/Loans
for all Lenders2
	Amount of
Commitment/Loans
Assigned
	Percentage
Assigned of
Commitment/
Loans3
	

CUSIP
 Number

	 
	 
	____________
	$________________
	$_________
	____________%
	 

	 
	 
	____________
	$________________
	$_________
	____________%
	 

	 
	 
	____________
	$________________
	$_________
	____________%
	 

		
	[7.
	Trade Date:    __________________] 4    

Effective Date:  __________________, 20__ [TO BE INSERTED BY ADMINISTRATIVE AGENT AND WHICH SHALL BE THE EFFECTIVE DATE OF RECORDATION OF TRANSFER IN THE REGISTER THEREFOR.]

The terms set forth in this Assignment and Assumption are hereby agreed to:

	
					
	 
	 
	 
	 
	 

	1 
	Fill in the appropriate terminology for the types of facilities under the Credit Agreement that are being assigned under this Assignment (e.g. “Revolving Credit Commitment”, “Term Commitment”, etc.).

	2 
	     Amounts in this column and in the column immediately to the right to be adjusted by the counterparties to take into account any payments or prepayments made between the Trade Date and the Effective Date.

	3 
	     Set forth, to at least 9 decimals, as a percentage of the Commitment/Loans of all Lenders thereunder.
     

	4 
	     To be completed if the Assignor and the Assignee intend that the minimum assignment amount is to be determined as of the Trade Date.

Schedule E-1

	
		
	 
	ASSIGNOR
[NAME OF ASSIGNOR]

By: __________________________
Title:

	 
	ASSIGNEE
[NAME OF ASSIGNEE]

By: ___________________________
Title:

	 
	 

	[Consented to and]5 Accepted:

BANK OF AMERICA, N.A.,
as Administrative Agent

By: __________________________________
Title:
	 

	 
	 

	[Consented to:]6
CARRIAGE SERVICES, INC.

By: __________________________________
Title:
	 

	
					
	 
	 
	 
	 
	 

	5 
	To be added only if the consent of the Administrative Agent is required by the terms of the Credit Agreement.

	6 
	To be added only if the consent of the Borrower and/or other parties (e.g. Swing Line Lender) is required by the terms of the Credit Agreement.

Schedule E-1

ANNEX 1 TO ASSIGNMENT AND ASSUMPTION

STANDARD TERMS AND CONDITIONS FOR
ASSIGNMENT AND ASSUMPTION

		
	1.
	Representations and Warranties.

1.1Assignor.  The Assignor (a) represents and warrants that (i) it is the legal and beneficial owner of the Assigned Interest, (ii) the Assigned Interest is free and clear of any lien, encumbrance or other adverse claim and (iii) it has full power and authority, and has taken all action necessary, to execute and deliver this Assignment and Assumption and to consummate the transactions contemplated hereby; and (b) assumes no responsibility with respect to (i) any statements, warranties or representations made in or in connection with the Credit Agreement or any other Loan Document, (ii) the execution, legality, validity, enforceability, genuineness, sufficiency or value of the Loan Documents or any collateral thereunder, (iii) the financial condition of the Borrower, any of its Subsidiaries or Affiliates or any other Person obligated in respect of any Loan Document or (iv) the performance or observance by the Borrower, any of its Subsidiaries or Affiliates or any other Person of any of their respective obligations under any Loan Document.

1.2Assignee.  The Assignee (a) represents and warrants that (i) it has full power and authority, and has taken all action necessary, to execute and deliver this Assignment and Assumption and to consummate the transactions contemplated hereby and to become a Lender under the Credit Agreement, (ii) it meets all the requirements to be an assignee under Section 10.06(b)(iii), (v) and (vi) of the Credit Agreement (subject to such consents, if any, as may be required under Section 10.06(b)(iii) of the Credit Agreement), (iii) from and after the Effective Date, it shall be bound by the provisions of the Credit Agreement as a Lender thereunder and, to the extent of the Assigned Interest, shall have the obligations of a Lender thereunder, (iv) it is sophisticated with respect to decisions to acquire assets of the type represented by the Assigned Interest and either it, or the Person exercising discretion in making its decision to acquire the Assigned Interest, is experienced in acquiring assets of such type, (v) it has received a copy of the Credit Agreement, and has received or has been accorded the opportunity to receive copies of the most recent financial statements delivered pursuant to Section 6.01 thereof, as applicable, and such other documents and information as it deems appropriate to make its own credit analysis and decision to enter into this Assignment and Assumption and to purchase the Assigned Interest, (vi) it has, independently and without reliance upon the Administrative Agent or any other Lender and based on such documents and information as it has deemed appropriate, made its own credit analysis and decision to enter into this Assignment and Assumption and to purchase the Assigned Interest, and (vii) if it is a Foreign Lender, attached hereto is any documentation required to be delivered by it pursuant to the terms of the Credit Agreement, duly completed and executed by the Assignee; and (b) agrees that (i) it will, independently and without reliance upon the Administrative Agent, the Assignor or any other Lender, and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under the Loan Documents, and (ii) 

Schedule E-1

it will perform in accordance with their terms all of the obligations which by the terms of the Loan Documents are required to be performed by it as a Lender.  The Assignee further represents and warrants as of the Effective Date to the Administrative Agent, the Assignor and the respective Affiliates of each, and not, for avoidance of doubt, for the benefit of the Borrower or any other Loan Party, that the Assignee is not and will not be (i) an employee benefit plan subject to Title I of ERISA; (ii) a plan or account subject to Section 4975 of the Code; (iii) an entity deemed to hold “plan assets” of any such plans or accounts for purposes of ERISA or the Code; or (iv) a “governmental plan” within the meaning of ERISA.

2.Payments.  From and after the Effective Date, the Administrative Agent shall make all payments in respect of the Assigned Interest (including payments of principal, interest, fees and other amounts) to the Assignor for amounts which have accrued to but excluding the Effective Date and to the Assignee for amounts which have accrued from and after the Effective Date.

3.General Provisions.  This Assignment and Assumption shall be binding upon, and inure to the benefit of, the parties hereto and their respective successors and permitted assigns.  This Assignment and Assumption may be executed in any number of counterparts, which together shall constitute one instrument.  Delivery of an executed counterpart of a signature page of this Assignment and Assumption by telecopy shall be effective as delivery of a manually executed counterpart of this Assignment and Assumption.  This Assignment and Assumption shall be governed by, and construed in accordance with, the law of the State of Texas.

Schedule E-1EX-4.8

 Exhibit 4.8 

English Translation of Chinese Original 

CHINA NATIONAL PETROLEUM CORPORATION 

AND 
 PETROCHINA COMPANY
LIMITED 
 COMPREHENSIVE PRODUCTS AND SERVICES AGREEMENT 

 THIS AGREEMENT is entered into on this
24th day of August, 2017 in Beijing by and between: 
 CHINA NATIONAL PETROLEUM
CORPORATION (“Party A”), a state-owned enterprise duly organized and validly existing under the laws of the People’s Republic of China (the “PRC”), with its Uniform Social Credit Code being 91110000100010433L and its
registered address being at Liupukang, Xicheng District, Beijing, PRC; and 
 PETROCHINA COMPANY LIMITED (“Party B”), a
joint stock limited company duly organized and validly existing under the laws of the PRC, with its Uniform Social Credit Code being 91110000710925462X and its registered address being at 16 Andelu, Dongcheng District, Beijing. 

1. Background 
 Upon
approval by the State Council, Party A implemented a restructuring (the “Restructuring”) and in its capacity as the sole promoter, incorporated Party B on November 5, 1999 in accordance with the laws of the PRC and owned 100% equity
interest in Party B. Party B issued overseas shares through public offering, including “overseas-listed foreign shares” (“H shares”) listed on the Stock Exchange of Hong Kong Limited (the “Hong Kong Stock Exchange”),
and American Depositary Shares listed on the New York Stock Exchange of the USA (the “ADS”). 
 Party A transferred into Party B
the businesses which, prior to the Restructuring, constituted the principal businesses of Party A and its affiliated enterprises or units, including the exploration and exploitation of crude oil and natural gas, crude oil refining, chemical
business, pipeline transmission, marketing, relevant research institutes and the related assets, liabilities and interests. After the Restructuring, Party A retained the businesses of construction and technical services, production services, supply
of materials services, ancillary services, social services, etc., and the relevant assets, liabilities and interests. 
 Upon completion of
the combined offering (including the issue of H Shares and ADS) in April, 2000, Party A continued to be the controlling shareholder of Party B. Following the issuance of domestic common shares dominated in Renminbi (“A shares”) by Party B
in October, 2007 and the listing of the same on the Shanghai Stock Exchange, Party A has remained the controlling shareholder of Party B. 

Party A owns the construction and technical services, production services, supply of materials services, ancillary services, social services,
financial services etc. in relation to the production and operation of oil and natural gas. Such business can provide necessary services for the production and operation and the life of employees of Party B and its affiliates. Party A and its
affiliates have the advantage of talents, technology and region, and have experience of long-term cooperation with each unit of Party B prior to the Restructuring. Therefore, Party B is willing to receive the aforesaid products and services from
Party A pursuant to this Agreement. 
 Party B owns crude oil, natural gas, refining and chemical products and the relevant by-products and semi-finished products, and is in the position to provide the services including supply of water, electricity, gas, heating, measurement, quality inspection and entrusted operations and management.
Party B and its affiliates had experience in long-term cooperation with Party A and its affiliates prior to the Restructuring. Therefore, Party A is willing to receive the aforesaid products and services from Party B pursuant to this Agreement. 

On such basis, Party A and Party B are willing to sign this Agreement and provide each other with the relevant products and services pursuant
to this Agreement. Therefore, both parties agree and guarantee to procure their respective entities, including their respective subsidiaries, branches and other relevant units, to provide the products and services hereof in accordance with the terms
and principles of this Agreement. 

  
 2 

 NOW, THEREFORE, Party A and Party B hereby agree as follows: 

2. Agreement 
 Article 1
Scope of Products and Services 
 The Products and services provided by Party A and Party B to each other under this Agreement are as
follows: 
  

	1.1	The products and services provided by Party B to Party A include: crude oil, natural gas, refining oil products, chemical products, supply of water, electricity, gas and heating; measurement, quality inspection,
entrusted operations and management and other relevant or similar products and services. 

  

	1.2	The products and services provided by Party A to Party B include: 

  

	 	(a)	Construction and technical services: geological surveying, drilling, well cementing, logging, mud logging, well testing, downhole operation, oilfield construction (including construction and installation), oil refinery
construction (including construction and installation), engineering and design, project monitoring and management, equipment repairing and maintenance, equipment antiseptic testing and technology research (including the service of patent, know-how and computer software provided for the aforesaid service), information service, public construction (the road of oilfields and factories, municipal construction, civil buildings and public facilities), risk
operation services and other relevant or similar products or services. 

  

	 	(b)	Production services: supply of water, electricity, gas, heating; communications, fire fighting, security, library information and filing services, asset leasing, environmental protection and sanitation in the factory
and mining areas, repair of machinery, manufacture of machinery, transportation, maintenance of roads and other relevant or similar products or services. 

  

	 	(c)	Supply of materials services: purchase of materials, quality inspection, storage of materials, delivery of materials and other relevant or similar products or services. 

 

	 	(d)	Ancillary services: property management, training centers, guesthouses, canteens, management of shower rooms and other relevant or similar services. 

 

	 	(e)	Social services: regional security services, education (including affiliated schools, technician training schools, educational qualification schools), hospitals, kindergartens, daycare centers, cultural propaganda
(including TV station, radio, newspaper publishing house), public transportation, municipal facilities (including greening of road, city and mining area), retirement administration, re-employment services
centers, miscellaneous social services, and other relevant or similar services. 

  

	 	(f)	Financial services: making loan and accepting deposits in Renminbi and foreign currencies, payment and receipt of interests, providing guarantee and clearance and settlement services, entrusted management of production
safety guarantee fund related to refining and chemical, and other financial services engaged in by Party A through financial institutions such as its affiliate, China National Petroleum Company Finance Co., Ltd., subject to the applicable
regulations. 

  

	1.3	Party A and Party B agree to enter into separate agreements in connection with the supervision of the sales business of certain oil companies, the lease of buildings and the lease and use of use rights, the licensing of
intellectual property (including patents, trademarks, know-now, computer software, but excluding those mentioned in 12(a)), the transfer of the rights and obligations of those cooperation agreements with
foreign entities regarding oil explorations and exploration, the guarantee of part of Party B’s debts, which are in relation to relevant oil companies. 

  

	1.4	 Party B shall provide financial assistance to those companies jointly owned by Party A and Party B in which Party
A and its subordinate companies and entities (including subsidiaries, branches and other entities) hold 

  
 3 

	 	
10% or more of the voting securities, whether individually or in the aggregate, (hereinafter referred to as “Jointly-owned Companies”), including (a) the provision of entrusted
loans to the Jointly-owned Companies through China National Petroleum Company Finance Co., Ltd. or other financial institutions, and (b) the provision of guarantee for the Jointly-owned Companies. 

 

	1.5	The Jointly-owned Companies shall provide financial assistance to Party B, including (a) the provision of entrusted loans to Party B through China National Petroleum Company Finance Co., Ltd. or other financial
institutions, and (b) the provision of guarantee for Party B. 

  

	1.6	Products provided by Jointly-owned Companies include: crude oil, oil products, chemical products, and natural gas etc. Pricing standards for the foregoing products shall refer to the pricing standards of the same
services as listed in Appendix 1 hereto. 

 Article 2 General Principles 

Party A and Party B agree that the products and services hereof shall be provided under the following general principles: 

 

	2.1	The quality of products and services to be provided shall be excellent, the prices at which such products and services are to be provided shall be fair and reasonable, and the terms and conditions on which such products
and services are to be provided shall be no less favorable than those offered by any third parties if such third parties provide the same products or services, or participate in the similar trade. 

 

	2.2	The products and services hereof shall be provided and standardized by contracting and in compliance with the provisions of the relevant regulations of the places where Party B are listed (including but not limited to
listing rules). 

  

	2.3	The products and services shall be provided in accordance with the requirement of the reform and opening and establishment of socialist market economy and in compliance with the relevant laws and regulations in
accordance with the principle of orderly competition by comparison of quality and price, equality and priority. 

  

	2.4	Subject to the compliance with the interests of Party B and the relevant regulations of the local places where its shares are listed (including but not limited to the listing rules), and with the continuing development
of the production and operation of both parties, Party A and Party B will determine the terms and conditions of transactions according to the general principles and pricing principles hereof after negotiations if both parties are willing to provide
to each other the products and services other than those covered in this Agreement. 

 Article 3 Pricing Principles 

The products and services hereof shall be provided in accordance with the principles of this article. 

 

	3.1	The price of any product and service provided pursuant to this Agreement shall be determined in accordance with the general principles and order of this article: (a) if there is
Government-Set-Price, the price for any product and service hereof shall be determined by reference to such Government-Set-Price; (b) if there is no Government-Set-Price but there is Market Price, the price for any product and service hereof shall be determined by reference to such Market Price; (c) if there is neither
Government-Set-Price nor Market Price, the price for any product and service hereof shall be determined on the basis of the actual cost or the Agreed Contractual Price. 

 

	3.2	Specific pricing principles: 

 The prices for the products and services of 3.2(a), (b), (c) and
(d) shall be determined according to the specific principles as follows and mentioned in the Appendixes. Where such specific principles are not 

  
 4 

 
applicable, then the prices for the relevant products and services shall be re-determined according to the general principles of 3.1 hereof. 

 

	 	(a)	Production services 

 Oil and gas providing services (including the supply of water,
electricity, gas and heating) shall be priced according to the Government-Set-Price plus costs of sub-supply (if applicable). 

 

	 	(b)	Construction and technical services 

 The service of carrying out construction shall be provided
in accordance with the lump-sum budgetary estimates and budgets. The lump-sum price or fee rate of the construction services for special purposes shall be determined in
accordance with the following principles: before the State issues the uniform standard of lump-sum price or fee rate, the price for special-purpose construction shall be determined by reference to the Agreed
Contractual Price, but shall be more favorable than the price standard of the similar construction in the international market. After the State issues such uniform standard, the price for the same shall be determined according to such uniform
standard. 
 The lump-sum price or fee rate for the public construction services (refer to the
services in connection with roads, municipal facility, civil building and public facility in oil field areas and factory areas) are that where there is a uniform standard of lump-sum price or fee rate set by
the State, the price for such services shall be determined by reference to such standard; where there is no such standard, prior to January 1, 2000, the price for such services shall be determined according to Market Price. From and after
January 1, 2000, by public bidding according to the provisions of the Law of the People’s Republic of China on Invitation and Submission of Bids which came into effect on January 1, 2000. 

 

	 	(c)	Social services 

 Please refer to Appendix II hereto for specific pricing principles. For the
actual cost and the Agreed Contractual Price, the following provisions shall be complied with: 
  

	 	(i)	The prices of security services shall not be higher than the actual expenditures in respect of security services incurred by Party B in 1998. 

 

	 	(ii)	The prices of education, medical, cultural publicity services shall be shared reasonably according to the actual expenditures incurred by Party A’s enterprises in 1998 and the ratio of interests enjoyed by both
parties (that is, the units now comprising Party A and Party B and their affiliates) in 1998. The prices of such services thereafter shall not be higher than the expenditures shared by Party B and calculated in the aforesaid way, and be reduced
annually as such services are transferred to the relevant governmental authorities. 

  

	 	(iii)	The prices for retirement administration and reemployment service center shall be shared reasonably by the Parties after negotiation by both Parties according to the actual Cost Price and the extent of benefits enjoyed
by Party A and Party B as well as their affiliates, and be reduced on an annual basis as the national social security system is gradually improved. 

  

	 	(d)	Financial services provided by financial institutions 

 The fees for financial services provided
by financial institutions such as China National Petroleum Company Finance Co., Ltd. shall be determined by reference to the interest rate of the same period and relevant fee standard announced by People’s Bank of China (“PBOC”) or
other competent financial regulatory authorities, and shall be no less favorable than the interest of the same period and the standard of fees and other conditions for the money and services obtained by Party B from any independent third party. 

  
 5 

 Apart from the provisions in (a), (b), (c) and (d) above, prices for other products and
services shall be determined in accordance with the general principle stipulated in Article 3.1 herein. 
  

	3.3	(a) Pricing standards of the various financial assistance provided by Party B to Jointly-owned Companies shall refer to the pricing standards of the same services as listed in the financial service category of Appendix
II hereto; 

  

	 	(b)	Pricing standards of the various financial assistance provided by Jointly-owned Companies to Party B shall refer to the pricing standards of the same services as listed in the financial service category of Appendix II
hereto. 

 Article 4 Operation 
  

	4.1	Both parties are required to submit to each other an annual plan detailing the demand for products or services provided by the other party for the forthcoming year before 31 October every year, and prepare an
annual plan detailing the provision of products or services to the other party and submit plan to the other party before 30 November of that year. 

  

	4.2	Both parties shall guarantee their branches, subsidiaries and other controlled units to enter into specific product or service implementation agreements according to the corresponding annual plans for supply and demand
of products or services. 

  

	4.3	Unless both parties terminate this Agreement in advance according to 6.1(b) hereof, the annual plan of supply and demand of products or services of both parties can be adjusted. However, Party A or Party B or its
branches, subsidiaries and other controlled units shall, prior to the annual supply plan in respect of such products or services is ascertained by the counterparty, put forward and submit the adjustment to Party A or Party B with which they are
affiliated. Both parties shall make the corresponding adjustment of the annual plan for products or services respectively with consensus. The plan for supply and demand of products or services can be adjusted during the course of implementation as
required and agreed by both parties, failing which, Party A shall, subject to the conditions of 6.1(b) hereof, provide with the relevant products or services to Party B according to the demand plan submitted by Party B to Party A. 

 

	4.4	The term of product or service implementation agreements entered into according to this Agreement shall normally be one year. The product or service implementation agreements with a term of more or less than one year
shall be reached by parties through mutual consultation. The terms for financial services can be negotiated by both parties according to the different requirements of various specific projects. 

Article 5 Rights and Obligations of Both Parties 
  

	5.1	The rights and obligations of Party A 

  

	 	(a)	Party A has the right to: 

  

	 	(i)	Party A has the right to obtain the products and services provided by Party B in accordance with this Agreement; 

  

	 	(ii)	Party A has the right to receive, including through its entities (including its subsidiaries, branches and other relevant units) fees pursuant to the provisions of this Agreement; 

 

	 	(iii)	prepare the plan for the supply of products and services according to the plan of Party B for demand of products or services; and 

  

	 	(iv)	choose to provide the services listed in Appendix II to third parties, provided Party A shall guarantee the provision of products and services to Party B according to the provisions of this Agreement. 

  
 6 

	 	(b)	The obligations of Party A include: 

  

	 	(i)	to procure and guarantee its entities, including its subsidiaries, branches and other relevant units, to enter into the relevant product or service implementation agreements with Party B and its entities, including its
subsidiaries, branches and other relevant units, pursuant to the provisions of this Agreement and the annual product or service supply and demand plans; 

  

	 	(ii)	to supervise its affiliated companies to provide specialized services such as the supply of water, electricity and gas, communications, and fire fighting, and ensure good quality of services is delivered pursuant to the
provisions of this Agreement and as required by Party B; 

  

	 	(iii)	to supervise its affiliated companies and units to provide services according to the pricing standards provided under Appendix 2 of this Agreement. 

 

	 	(iv)	to coordinate the relevant matters relating to such product or service implementation agreements upon the request of the parties to such agreements; 

 

	 	(v)	to designate or establish special organizations responsible for liaison in relation to, preparation of documents for, making plans and arrangements for, balancing supply and demand for, supervision and coordination of
the performance of all relevant contracts in respect of, and other matters relating to products and services to be rendered under this Agreement; 

  

	 	(vi)	to procure its entities, including its subsidiaries, branches and other relevant units, to provide relevant services to Party B and its entities, including its subsidiaries, branches and other relevant units, and
guarantee to indemnify Party B or the corresponding parties against any loss suffered by the same arising from any breach of any provision of this Agreement or the relevant product and service implementation agreements; and 

 

	 	(vii)	to provide to the auditors of Party B with the accounting records of Party A and its associates in respect of the connected transactions. 

 

	5.2	the rights and obligations of Party B 

  

	 	(a)	Party B has the right: 

  

	 	(i)	Party B has the right to obtain, including through its entities (including its subsidiaries, branches and other relevant units), the products and services provided by Party A; 

 

	 	(ii)	to choose to receive products or services, including the services set forth in Appendix II, from any third party subject to the provisions of this Agreement and provided that quality of products or services of the same
type offered by such third parties shall be superior to those offered by Party A given the same terms and conditions. But either of parties shall continue to perform its obligations according to the agreements entered into by both parties before
this Agreement came into force in respect of one or more of the products or services herein; 

  

	 	(iii)	to prepare the annual plan for supply and demand and make the corresponding adjustments thereof in its discretion; 

  

	 	(iv)	to receive, including through its entities (including its subsidiaries, branches and other relevant units), the fees for services pursuant to this Agreement; 

 

	 	(v)	to provide with the services listed in Appendix I to any third parties without prejudicing Party A and in compliance with the provisions of this Agreement; and 

 

	 	(vi)	to audit the accounting records of Party A and its associates in respect of connected transactions. 

  

	 	(b)	The obligations of Party B include: 

  

	 	(i)	 to procure and guarantee its entities, including its subsidiaries, branches and other relevant units, to enter
into the relevant product and service implementation agreements with Party A and its 

  
 7 

	 	
entities, including its subsidiaries, branches and other relevant units thereof, pursuant to the provisions of this Agreement and the supply and demand plan; 

 

	 	(ii)	to supervise its subsidiary companies and units providing services of good quality in accordance with the pricing standards set forth in Appendix I hereto; 

 

	 	(iii)	to coordinate the relevant matters relating to product and services implementation agreements upon the request of the parties to such agreements; 

 

	 	(iv)	to designate or establish special organizations responsible for liaison in relation to, preparation of documents for, making plans and arrangements for, balancing supply and demand for, supervision and coordination of
the performance of all relevant contracts in respect of, and other matters relating to products and services to be rendered under this Agreement; 

  

	 	(v)	to pay the relevant service fees according to the provisions of this Agreement and each product and service implementation agreement; and 

 

	 	(vi)	to ensure the indemnification against any loss suffered by Party A or the corresponding parties arising from any breach of any provision of this Agreement or the relevant product and service implementation agreements,
unless the breach is committed by any of Party A’s subsidiaries in which Party B has any interests. 

  

	5.3	Party A and Party B have the obligation to take further necessary actions including the execution of other relevant agreements or contracts or documents so as to ensure the realization of the purpose and contents
provided in this Agreement. 

 Article 6 Term and Termination of Specific Contracts 

 

	6.1	Termination of supply. 

  

	 	(a)	In the event Party B is unable to obtain conveniently certain services provided by Party A from any third party (including but not limited to any third party affiliated to Party A) and Party B notifies Party A of
such situation from time to time, unless permitted by Party B in writing, Party A shall not terminate the supply of such services (other than for any breach of the provisions of this Agreement by Party B). 

 

	 	(b)	Any party to the product and service implementation agreements (this Agreement excluded) entered into according to this Agreement may issue, in compliance with the Article 6.1(a) and 6.1(c), a written notice to the
other to terminate the provision of products or services not less than six months in advance. Such notice shall stipulate what products or services will cease to be supplied and when such termination will take effect. If the supply of certain
products or services is terminated according to this article, such termination shall neither affect other rights or obligations of Party A or Party B under this Agreement, nor affect other rights or obligations of any party to the product and
service implementation agreements entered into according to this Agreement. 

  

	 	(c)	If either party has issued a notice terminating the supply of certain services according to 6.1(b) hereof, unless otherwise agreed by both parties, such notice shall not terminate or affect the supply of such services
agreed by both parties at the time of or prior to issuing such notice. 

  

	6.2	This Agreement shall come into effect as of January 1, 2018 after it is chopped with the common seals of the parties hereto and approved at Party B’s general meeting of shareholders, and shall remain valid for
a period of three (3) years. The term of this Agreement may be extended subject to the mutual consent between the parties to this Agreement and the approval of the stock exchanges of the places where Party B is listed, and/or the ratification
of Party B’s general meeting of shareholders (as required by the stock exchanges and the competent regulatory authorities of the places of listing). 

  

	6.3	 If one party breaches any provision of this Agreement (the “Defaulting Party”) and the other party(the “Non-defaulting Party”) issues a written notice notifying the Defaulting Party of its breach and requires the Defaulting Party to remedy within the reasonable period determined by the Non-defaulting Party, the Non-defaulting Party may immediately terminate this Agreement if the Defaulting Party fails to remedy such

  
 8 

	 	
breach within the aforesaid period. The Non-defaulting Party reserves the rights of recourse and compensation and other rights and claims against the
Defaulting Party permitted by any law. If the Non-defaulting Party fails to issue such notice to the Defaulting Party According to the provisions of this article, such failure shall not be construed as a
waiver of any right provided in this Agreement and permitted by laws. 

  

	6.4	The termination of this Agreement shall not affect the rights or obligations of either party hereto accrued under this Agreement prior to the termination. 

Article 7 Representations and Warranties 
  

	7.1	The Party A represents and warrants as follows: 

  

	 	(a)	Party A is an enterprise established in accordance with law with independent legal-person status and holds a valid business license; 

 

	 	(b)	Party A has carried out its businesses in accordance with law and has never engaged in any activities beyond the business scope prescribed by law; 

 

	 	(c)	Party A has obtained all governmental approvals (if necessary) and has obtained or completed all internal authorizations necessary for the execution of this Agreement; the signor of this Agreement on its behalf is a
duly authorized representative of Party A; and this Agreement, when executed, shall constitute binding obligations of Party A; and 

  

	 	(d)	The execution of this Agreement and the performance of its obligations hereunder by Party A will not violate any other agreements to which Party A is a party, the Party A’s articles of association or any laws,
regulations and rules and will not legally or commercially conflict with any other agreement to which Party A is a party or the Party A’s articles of association. Party A has not been in breach of any agreement to which it is a party.

  

	7.2	Party B represents and warrants as follows: 

  

	 	(a)	Party B is a joint stock company with limited liability which was established in accordance with law with independent legal-person status and holds a valid business license; 

 

	 	(b)	Party B has carried out its business in accordance with law and has never engaged in any activities beyond the business scope prescribed by law; 

 

	 	(c)	Party B has obtained or completed all the internal authorizations necessary for the execution of this Agreement; the signor of this Agreement on its behalf is a duly authorized representative of Party B; and this
Agreement, when executed, shall constitute binding obligations of Party B; and 

  

	 	(d)	The execution of this Agreement and the performance of the obligations hereunder by Party B will not violate any other agreements to which Party B is a party, Party B’s articles of association or any laws,
regulations and rules, and will not legally or commercially conflict with any other agreements to which Party B is a party, or Party B’s articles of association. Party B has not been in breach of any agreement to which it is a party.

 Article 8 Force Majeure 
  

	8.1	If a party hereto fails to perform all or part of its obligations under this Agreement due to an Event of Force Majeure (an Event of Force Majeure means an event beyond the reasonable control of the affected party and
is unforeseeable, or unavoidable and insurmountable if foreseeable, and which happens after the execution of this Agreement and renders the full or partial performance of this Agreement impossible or impracticable in effect. An Event of Force
Majeure includes but not limited to flood, fire, draught, typhoon, earthquake, and other natural disaster, traffic accident, strike, insurrection, turmoil and war (whether declared or not ) and any action or inaction of any governmental
authorities), the performance of such obligations shall be suspended during the period being affected by the Event of Force Majeure. 

  
 9 

	8.2	The party claiming being affected by an Event of Force Majeure shall notify the other in writing of the occurrence of such an event as soon as possible, and shall, within 15 days after the occurrence of such an event,
provide the other party by courier or registered air mail with appropriate evidence proving the occurrence of the Event of Force Majeure and the period of time it lasts. The party claiming that its performance of this Agreement has become impossible
or impracticable due to an Event of Force Majeure shall take all the reasonable measures to eliminate or minimize the effects of the Event of Force Majeure. 

  

	8.3	In case of the occurrence of an Event of Force Majeure, both parties shall immediately consult with each other in respect of the performance of this Agreement and shall immediately resume their respective obligations
under this Agreement after the cease of the Event of Force Majeure or the elimination of the effects of the same. 

 Article
9 Public Announcement 
 Without the prior written consent of the other party, no party may issue any public announcements on matters
relating to this Agreement, other than public announcements issued in accordance with the provisions of the China Securities Regulatory Commission, the Shanghai Stock Exchange, the Hong Kong Stock Exchange, the Hong Kong Securities and Futures
Commission, the New York Stock Exchange, the U.S. Securities and Exchange Commission or any other governmental or securities regulatory body. 

Article 10 Miscellaneous 
  

	10.1	Unless otherwise provided for in this Agreement, without the written consent from the other party, no party shall transfer all or part of its rights or obligations under this Agreement. 

 

	10.2	This Agreement and the appendices hereto constitute the entire agreement between the parties, and supersede all previous oral and written agreements, contracts, understandings and communications between the parties in
respect of the subject matter of this Agreement. 

  

	10.3	The illegality, invalidity or unenforceability of any article of this Agreement shall not affect the validity and enforceability of any other provisions of this Agreement. 

 

	10.4	Both parties agree to bear their respective fees and expenses incurred for execution of this Agreement in accordance with applicable PRC laws. Where no law addresses the matter, both parties shall share the fees and
expenses equally. 

  

	10.5	Any amendments to this Agreement or its appendices may be made only by a written agreement executed by authorized representatives of both parties and shall be approved by both parties through appropriate corporate
actions. In the event that such amendments constitute material and significant amendments to this Agreement and /or its appendices, the amendment shall not come into effect until it is notified to or approved by the Stock Exchange of Hong Kong
Limited or (if applicable) the shareholders meeting of Party B (as then required by the Stock Exchange of Hong Kong Limited). 

  

	10.6	The delay or failure on the part of either party hereto to exercise any right, power or privilege under this Agreement shall not operate as a waiver thereof, nor shall any single or partial exercise of any right, power
or privilege preclude exercise of any other right, power or privilege. 

  

	10.7	The appendices hereto shall constitute an integral part of this Agreement and have the same binding effect on the parties hereto as if the appendices were incorporated into this Agreement. 

Article 11 Communications 
  

	11.1	 Notices and other communications required to be given by any party pursuant to this Agreement shall be written in
Chinese and may be delivered personally, or by registered mail to the address of the other party or 

  
 10 

	 	
sent by facsimile transmission to the number of the other party set forth below. The dates on which notices shall be deemed to have been effectively delivered shall be determined as follows:

  

	 	(a)	Notices given by personal delivery shall be deemed effectively delivered on the date of personal delivery; 

  

	 	(b)	Notices given by registered mail shall be deemed effectively delivered on the 7th day ( if the last day falls on a Sunday or a public holiday, than such date shall be
postponed to the next working day ) after the date on which they were mailed (as indicated by the postmark); 

  

	 	(c)	Notices given by facsimile transmission shall be deemed effectively delivered at the time when the transmission is completed, provided that the sender shall produce the transmission report evidencing the successful
transmission of relevant documents; 

 The addresses and facsimile numbers of the parties are as follows: 

If to Party A: 
 China
National Petroleum Corporation 
 Mailing Address: 9 Dongzhimen North Street, Dongcheng District, Beijing, the PRC 

Facsimile Number: 010-6209 9428 

Post Code: 100007 
 If to Party
B: 
 PetroChina Company Limited 

Mailing Address: 9 Dongzhimen North Street, Dongcheng District, Beijing, the PRC 

Facsimile Number: 010-6209 9436 

Post Code: 100007 
 A party
shall, in accordance with the provisions in this Article and as soon as possible, notify the other party in writing of any change to its address or facsimile number set forth above. 

Article 12 Governing Law and Dispute Settlement 
  

	12.1	This Agreement shall be governed by and interpreted in accordance with the PRC law. Any dispute arising from or in connection with this Agreement shall be resolved through friendly consultation between the parties. If
the dispute cannot be settled in the aforesaid manner, either party shall be entitled to submit the dispute to Beijing Arbitration Commission for arbitration to be conducted in accordance with the Commission’s arbitration rules in effect at the
time of the arbitration. The arbitral award shall be final and binding upon both parties. 

  

	12.2	The provisions in each of the specific contracts in respect of dispute settlement shall be made with reference to the dispute settlement clauses set forth herein. 

Article 13 Definition and Interpretation 
  

	13.1	Unless the context otherwise requires, the following terms shall have the following meanings in this Agreement: 

  

			
	“Financial Year”	  	the calendar year from 1 January to 31 December.
		
	“Services”	  	the transactional activities in which the parties hereto provide each other with the services within the service scope stipulated in this Agreement.

  
 11 

			
	
“Government-Set-Price”
	  	the price for such type of services as determined in any laws, regulations, decisions, orders or guidelines enacted by any government of the relevant country/region (including but not limited to any central government, federal
government, local government, state/league government and any other instrumentality that rules a certain territory by controlling domestic issues and foreign affairs thereof, in whatever name, structure and form), and any other regulatory
authority.
		
	 “Market Price”
	  	the price determined according to the following order of priority: (1) the price determined by reference to the prices then charged by at least two independent third parties for services of comparable size provided on an
arm’s length basis in the place where the subject services are provided or in the vicinity thereof; (2) the price determined by reference to the prices then charged by at least two independent third parties for services of comparable size
provided on an arm’s length basis in the neighboring region/country of the place where the subject services are provided.
		
	 “Cost Price”
	  	the price determined by the actual cost incurred by Party A, but not more than the actual cost at which the relevant services were provided by Party A in 1998.
		
	 “Agreed Contractual Price”
	  	as for the geological surveying, drilling, well cementing, logging, mud logging, well testing, downhole operation, and oilfield construction, the Agreed Contractual Price shall be the actual cost for the provision of such product
or services plus an additional margin of not more than 15%, provided that, such Agreed Contractual Price shall not be higher than the prices available for the provision of such products and services in the international market. As for other products
and services priced in accordance with the Agreed Contractual Price, the Agreed Contractual Price shall be the actual cost for the provision of such product or service plus an additional margin of not more than 3%.
		
		  	For the avoidance of doubt, the aggregate value of all products and services provided at Cost Price and at Agreed Contractual Price and at the ratio of benefits received by Party A and Party B pursuant to this Agreement during
the financial year ended 31 December 1998 was RMB 36.9 billion, calculated on a pro-forma adjusted basis (the “1998 Amount”). The aggregate value of, in each future financial year, of
products and services provided by Party A to Party B at Cost Price, or at Agreed Contractual Price pursuant to this Agreement shall not exceed the 1998 Amount. But in the event the cost of certain products or services changes due to inflation, the
aggregate value of products or services purchased by Party B from Party A may exceed the 1998 Amount, but the margin shall not be higher than the extra amount calculated on the basis of the national average inflation promulgated by the State. If,
due to the development of new projects or natural disasters or other special events, Party B is required to purchase additional products or services such that the aggregate value of all such products or services to be priced at cost or at Agreed
Contractual Prices exceeds the 1998 Amount, the decision for such purchase shall be made by the board of directors and the management of Party B on the basis of the comprehensive analysis of Party B’s business plan and financial situation, to
ensure that such purchases allow for the reasonable returns to Party B’s shareholders.
		
	 “Pricing Standards”
	  	Government-Set-Prices, Market Prices, Agreed Contractual Prices or Cost Prices.

  
 12 

			
	 “Supply”
	  	The activities of providing products and services by Party A and Party B to each other according to the provisions of this Agreement.
		
	 “Risk Operation Services”
	  	Within certain conventional reserve blocks with exploitation difficulties and certain unconventional reserve blocks specified by Party B, Party A provides comprehensive risk operation services to Party B for its exploitation and
production within these reserve blocks by supplying capital and bear the risks. Party B is responsible to pay a service fee to Party A only when there are crude oil and natural gas outputs in these reserve blocks. Such services are contractual
services. The mineral interests and ownership of reserves of such reserve blocks remain unchanged. The outputs of crude oil and natural gas shall be recorded to Party B, who is responsible for the centralized sales of such outputs. Taking into
consideration the quality level and the difficulties of exploitation of the reserve blocks where Party A provides risk operation services and the investment made by Party A thereinto, the service fee payable by Party B shall be calculated based on a
certain percentage of the then prevailing Market Price of the crude oil and natural gas outputs under the risk operation services Party A provided, and shall be paid in cash. For conventional oil and gas and unconventional oil and gas respectively,
different rates of service fee shall apply.
		
		  	The term “conventional oil and gas” refers to the oil and gas resources that can be extracted by using technologies already mastered and are economically viable. For conventional oil and gas, the service fee for the
risk operation services during the investment payback period shall be 60% — 70% of the then prevailing Market Price of crude oil and gas, and shall be 50% of the then prevailing Market Price of crude oil and gas after the investment payback
period expires.
		
		  	The term “unconventional oil and gas” refers to the oil and gas resources from which an economically viable output cannot be obtained unless by using large-sized enhanced
production measures or special extraction processes. For unconventional oil and gas, the service fee for the risk operation services during the investment payback period shall be equal to the then prevailing Market Price of the crude oil and gas
plus the price subsidy granted by the State (if any), and after the investment payback period expires shall be determined subject to further negotiations between the parties based on the then prevailing market conditions and corresponding approval
procedures.
		
	 “Entrusted Operation and Management”
	  	In view of the close linking between Party A and Party B in terms of certain units and many business processes and with a view to realizing the optimal allocation of internal resources, reducing operation costs, improving
management efficiency and giving better play to the synergy of various business segments, Party B will selectively accept the demands raised by Party A from time to time for the provision of management services in connection with its related
businesses so as to give full play to the advantages of Party B in terms of business management and realize the coordinated and sustainable development of the company’s business operations.
		
	 “Appendices”
	  	Appendix I or Appendix II, or both of them, unless otherwise stated in this Agreement.

  
 13 

	13.2	In this Agreement, unless the context otherwise requires: 

  

	(a)	A party shall include its successors; 

  

	(b)	Articles or appendices refer to the articles or appendices of this Agreement; 

  

	(c)	Unless this Agreement otherwise requires, this Agreement may be extended, amended, altered or supplemented through negotiations between both parties; 

 

	(d)	Headings are inserted for reference only and shall not affect the interpretation of this Agreement. 

Article 14    Others 
  

	14.1	This Agreement is written in Chinese. 

  

	14.2	This Agreement is made in six (6) originals. This Agreement shall come into effect as of January 1, 2018 after it is affixed with the signature of the authorized representative and the appropriate seal of each
party hereto and approved at Party B’s general meeting of shareholders. Each original shall have the same legal effect. 

  

	14.3	In witness whereof, each of the parties hereto has caused this Agreement to be executed on the day as stated on the first page of this Agreement. 

 

											
	 Party A:
	 		  	Party B:	 	
				
	China National Petroleum Corporation (affixed with Party A’s seal specifically for contracting purpose)	 		  	PetroChina Company Limited (affixed with Party B’s seal specifically for contracting purpose)	 	
						
	 Authorized Representative:
	 	 /s/
	 		  	Authorized Representative:	  	 /s/
	 	
		 	LIU Yuezhen	 		  		  	CHAI Shouping	 	

 Appendix I Services provided by Party B and it subsidiary entities to Party A and its subsidiary entities 

 

							
	 Services
	  	 No.
	  	 Service items
	 	 Pricing principles

	 Supply of oil and natural gas etc.
	  	1	  	Crude oil	 	Market Price
	  	2	  	Refined products	 	Government-Set-Price. Pursuant to the Notice of the National Development and Reform Commission on Further Improvement of Refined Oil Pricing Mechanism promulgated by the National
Development and Reform Commission (Fa Gai Jia Ge [2013] No. 624) on March 26, 2013, the retail price and wholesale price of gasoline and diesel as well as the supply price of the gasoline and diesel to be supplied to
special customers such as public wholesale operators, railway operators and transportation operators shall be goverment guided, while the supply price of the gasoline and the diesel for the use for national reserve purpose and for the use by
Xinjiang Production and Constrution Corps as well as the ex-factory price of the aviation gasoline shall be government set. The price of gasoline and diesel shall be adjusted every 10 business days in line
with the change of crude oil price on international market. The National Development and Reform Commission (the “NDRC”)

  
 14 

							
	 Services
	  	 No.
	  	 Service items
	 	 Pricing principles

		  		  		 	shall set the retail price ceilings of gasoline and diesel for all the provinces (automomous regions and centrally administered municipalities) and core cities, and the supply price of the gasoline and diesel for national reserve
purpose and for the use by Xinjiang Production and Construction Corps as well as the ex-factory price of the aviation gasoline.
				
		  	3	  	Chemical products	 	Market Price
				
		  	4	  	Natural gas	 	 Government-Set-Price.
  

Pursuant to the Circular of NDRC regarding Adjustment of Natural Gas Price promulgated by NDRC on June 28, 2013 (Fa Gai Jia Ge [2013]
No. 1246), the pricing mechanism of natural gas shall be changed from ex-factory-price-controlled to citygate-price-controlled, of which, the citygate price shall be government set. The
pricing of natural gas shall be under a price ceiling management regime, whereby, gas suppliers and users may negotiate specific prices between themselves below the price ceiling set by the government.

				
		  	5	  	Supply of water	 	 Government-Set-Price plus cost (if applicable).

 
 Pursuant to the Measures for Administration of Urban Water Supply Price (Ji
Jia Ge [1998] No. 1810) enacted by the original Planning Commission and the Ministry of Housing and Urban-Rural Development (“MHURD”), as amended by NDRC and MHURD on November 29, 2004, the urban water supply
price shall be set by the competent governmental authorities in accordance with the authority as set forth in the applicable List of Pricing Regulation Authority Allocation.

				
		  	6	  	Supply of electricity	 	 Government-Set-Price plus cost (if applicable).

 
 Pursuant to the Electric Power Law of the PRC enacted on December 28, 1995
and amended on August 27, 2009, by the Standing Committee of the National People’s Congress, the on-grid tariffs of the electric power distributed through the grids crossing different provinces,
autonomous regions and centrally administered municipalities, or provincial-level grids or independent grids shall be proposed by the power production enterprises in consultation with the grid operators and then submitted to the pricing regulatory
department under the State Council or competent pricing regulatory authorities for approval. The electric power generated by any local invested power producer, if distributed through independent grids running within the local province or for self-use by the power producer itself, may be administered by the local provincial (autonomous region or centrally administered municipality) people’s
government.

  
 15 

							
	 Services
	  	 No.
	  	 Service items
	 	 Pricing principles

				
		  	7	  	Supply of gas	 	 Government-Set-Price plus cost (if applicable).

 
 Pursuant to the Regulations on Administration of Urban Gas promulgated by the
State Council on October 19, 2010 under State Council Decree No. 583, the pricing regulatory authority under the people’s government above the county level shall determine and adjust the selling price of the pipeline delivered
gas.

				
		  	8	  	Supply of heating	 	 Government-Set-Price plus cost (if applicable).

 
 Since there are currently no documents addressing uniform standard of lump-sum price or fee rate for heating supply published by the State, the price of heating supply is set by the local government.

				
		  	9	  	Quantifying and Measuring	 	Market Price
				
		  	10	  	Quality Inspection	 	Market Price
				
		  	11	  	Entrusted Operation and Management	 	Market Price
				
		  	12	  	Materials Supply	 	Market Price
				
	Financial Services	  	1	  	Entrusted lending	 	The price shall be determined on the basis of the lending interest rate of the same period and the relevant fee standard published by PBOC and with reference to the Market Price.
				
		  	2	  	Guarantee	 	Market Price
				
		  	3	  	Others	 	The applicable prices set by and the fee rates published by PBOC, China Banking Regulatory Commission, China Insurance Regulatory Commission and other similar governmental authorities, and applicable Market
Prices.

  
 16 

 Appendix II Services provided by Party B and it subsidiary entities to Party A and its subsidiary
entities. 
  

							
	 Services
	 	No.	 	 Services items
	 	 Pricing principles

	 Engineering And Technical Services
	 	1	 	Geological surveying	 	Before the State publishes any uniform standard of lump-sum price or fee rate, the price of each item of services shall be determined by reference to the Agreed Contractual Price.
After the State publishes such uniform standard of lump-sum price or fee rate, the price of each item of services shall be determined on the basis of the same. The State has not yet published any document
addressing such uniform standard of lump-sum price or fee rate.
	 	2	 	Drilling	 
	 	3	 	Well cementing	 
	 	4	 	Logging	 
	 	5	 	Mud logging	 
	 	6	 	Well testing	 
	 	7	 	Downhole operation	 
	 	8	 	 Oilfield construction
 (including
buildings
 and installation)
	 
				
		 	9	 	Oil refinery construction (including buildings and installation)	 	 Government-Set-Price.

 
 For the construction part, the lump-sum price
set by the people’s government of the relevant province, autonomous region or centrally administered municipality shall be adopted, and for the installation part, the prevailing industrial lump-sum price
shall be adopted.

				
		 	10
	 	Engineering and design	 	 Government-Set-Price or Market Price.

 
 Pursuant to the Regulations on Administration of Fee Charging for Survey and Design
of Construction Projects promulgated by the original Planning Commission and the MHURD (Ji Jia Ge [2002] No. 10) on January 7, 2002, either the government- guided price or the market-driven price shall be
adopted for the fee to be charged for project exploration and project design of a construction project based on the amount of investment of such project as follows:
  

For those construction projects with an estimated total investment equal to or more than RMB 5 million, the fee for project exploration and project design
shall be charged at the government-guided price; and for those construction projects with an estimated total investment below RMB 5 million, the fee for project exploration and project design shall be charged at the market-driven
price.

				
		 	11	 	 Project monitoring
 and management
	 	 Government-Set-Price or Market Price.

 
 Pursuant to the Regulations on Administration of Fee Charging for Project Monitoring
and Management and Related Services to Construction Projects (Fa Gai Jia Ge [2007] No. 670) promulgated by NDRC

  
 17 

							
	 Services
	 	No.	 	 Services items
	 	 Pricing principles

		 		 		 	and MHURD on March 30, 2007, the fee for project monitoring and management services provided to a construction project during its construction phase for which such services are mandatory shall be charged at the government-guided
price; and the fee for such services provided to any other construction project during the construction phase, or the fee for such services provided to any construction project during any other phase, or the fee for any related services, shall be
charged at the market-driven price.
				
		 	12	 	 Equipment repairing and
 maintenance
	 	Agreed Contractual Price
				
		 	13	 	 Equipment antiseptic
 testing and
research
	 	Agreed Contractual Price
				
		 	14	 	Process and Technology services	 	Agreed Contractual Price
				
		 	15	 	 Public construction
 (roads of oilfields and
factories, municipal construction, civil buildings and public facilities)
	 	Where there is a uniform standard of lump-sum price or fee rate set by the State, the prices shall be determined by reference to such standard. Where there is no such standard, prior to
January 1, 2000, the prices shall be determined on the basis of the Market Price, and from and after January 1, 2000, the price shall be determined by public bidding in accordance with the provisions of the Law of the People’s
Republic of China on Invitation and Submission of Bids coming into effect on January 1, 2000.
				
		 	16	 	Risk Operation Services	 	Market Price
	 	17	 	Other services (including information services)	 	Market Price
				
	 Production Services
	 	1	 	Supply of water	 	 Government-Set-Price plus cost

 
 (if applicable).

Pursuant to the Measures for Administration of Urban Water Supply Price (Ji Jia Ge [1998] No. 1810) enacted by the original
Planning Commission and MHURD, as amended by NDRC and MHURD on November 29, 2004, the urban water supply price shall be set by the competent governmental authorities in accordance with the authority as set forth in the applicable List of
Pricing Regulation Authority Allocation.

				
		 	2	 	Supply of electricity	 	 Government-Set-Price plus cost (if applicable).

 
 Pursuant to the Electric Power Law of the PRC enacted on December 28, 1995
and amended on August 27, 2009, by the Standing Committee of the National People’s Congress, the on-grid tariffs of the

  
 18 

							
	 Services
	 	No.	 	 Services items
	 	 Pricing principles

		 		 		 	electric power distributed through the grids crossing different provinces, autonomous regions and centrally administered municipalities, or provincial-level grids or independent grids shall be proposed by the power production
enterprises in consultation with the grid operators and then submitted to the pricing regulatory department under the State Council or competent pricing regulatory authorities for approval. The electric power generated by any local invested power
producer, if distributed through independent grids running within the local province or for self-use by the power producer itself, may be administered by the local provincial (autonomous region or centrally
administered municipality) people’s government.
				
		 	3	 	Supply of gas	 	 Government-Set-Price plus cost (if applicable).

 
 Pursuant to the Regulations on Administration of Urban Gas promulgated by the
State Council on October 19, 2010 under State Council Decree No. 583, the pricing regulatory authority under the people’s government above the county level shall determine and adjust the selling price of the pipeline delivered
gas.

				
		 	4	 	Supply of heating	 	 Government-Set-Price plus cost (if applicable).

 
 Since there are currently no documents addressing uniform standard of lump-sum price or fee rate for heating supply published by the State, the price of heating supply is set by the local government.

				
		 	5	 	Communications	 	Agreed Contractual Price
				
		 	6	 	Fire fighting	 	Agreed Contractual Price
				
		 	7	 	Library information and filing services	 	Cost Price
				
		 	8	 	Maintenance of roads	 	Cost Price
				
		 	9	 	Security	 	Market Price
				
		 	10	 	Asset leasing	 	Market Price
				
		 	11	 	Environment and sanitation	 	Market Price
				
		 	12	 	Repair of machinery	 	Market Price
				
		 	13	 	Manufacture of machinery	 	Market Price
				
		 	14	 	Transportation	 	Market Price
				
		 	15	 	Others	 	Market Price

  
 19 

							
	 Services
	 	No.	 	 Services items
	 	 Pricing principles

	 Supply of Materials
	 	1	 	Purchase of materials	 	Market Price
	 	2	 	 Quality inspection,
 Storage, delivery
	 	Agreed Contractual Price
				
	 Ancillary Services
	 	1	 	Property management	 	Market Price
				
		 	2	 	Training centers	 	Agreed Contractual Price
				
		 	3	 	Guesthouses	 	Market Price
				
		 	4	 	Canteens	 	Market Price
				
		 	5	 	Public shower rooms	 	Market Price
				
		 	6	 	Others	 	Market Price
				
	 Social Service
	 	1	 	Security	 	The actual cost incurred by Party B in 1998.
	 	2	 	Education	 	The actual cost shared by Party B in 1998, reduced gradually.
	 	3	 	Hospitals	 
	 	4	 	Cultural and publicity	 
				
	 Social Services
	 	5	 	Kindergarten	 	Market Price
	 	6	 	Daycare	 
	 	7	 	Public transportation	 
		 	8	 	Municipal facilities	 
		 	9	 	Comprehensive services	 
				
		 	10	 	Retirement Administration	 	To be shared by the parties based on the Cost Price and the extent of benefits enjoyed.
		 	11	 	 Reemployment service
 Centers
	 
				
		 	12	 	Others	 	Market Price
				
	 Financial Services
	 	1	 	Loan, deposits, and payment of interest	 	Based on the interest rate of the same period and relevant fee standard promulgated by PBOC, and no less favorable than those offered by independent third parties.
	 	2	 	Interest income	 
	 	3	 	Guarantee	 	Not higher than the guarantee provision fees charged by PRC non-commercial banks for provision of guarantees.
	 	4	 	Others	 	The applicable prices set by and the fee rates published by PBOC, China Banking Regulatory Commission, China Insurance Regulatory Commission and other similar governmental authorities, and applicable Market Prices.

  
 20

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