by and between
STONEMOR GP HOLDINGS LLC
TABLE OF CONTENTS
|AGREEMENT TO SELL AND PURCHASE|
|Section 2.1||Sale and Purchase||4|
|Section 2.3||Deliveries by the Partnership||4|
|Section 2.4||Purchaser Deliveries||4|
|REPRESENTATIONS AND WARRANTIES OF THE PARTNERSHIP|
|Section 3.2||Purchased Units: Capitalization||4|
|Section 3.3||No Conflict||5|
|Section 3.6||Compliance with Laws||6|
|Section 3.7||Due Authorization||6|
|Section 3.8||Valid Issuance; No Options or Preemptive Rights||6|
|Section 3.9||No Registration Rights||6|
|Section 3.10||Periodic Reports||7|
|Section 3.12||No Side Agreements||7|
|Section 3.13||No Registration Required||7|
|Section 3.14||MLP Status||7|
|REPRESENTATIONS AND WARRANTIES OF THE PURCHASER|
|Section 4.1||Existence, Capacity, Authorization and Enforceability||7|
|Section 4.2||No Conflict||8|
|Section 4.3||Certain Fees||8|
|Section 4.4||No Side Agreements||8|
|Section 4.6||Nature of Purchaser||9|
|Section 4.7||Restricted Securities||9|
|Section 4.8||Legend; Restrictive Notation||9|
|Section 4.9||Reliance on Exemptions||10|
|Section 5.1||Further Assurances||10|
|Indemnification by the Partnership||10|
|Indemnification by Purchaser||10|
|Certain Special Allocations of Book and Taxable Income||12|
|Interpretation and Severability||12|
|Survival of Provisions||12|
|No Waiver; Modifications in Writing||13|
|Binding Effect; Assignment||13|
|Removal of Legend||14|
|Waiver of Jury Trial||14|
|Execution in Counterparts||15|
| Additional Limited Partner Certificate|
This COMMON UNIT PURCHASE AGREEMENT, dated as of December 30, 2016 (this Agreement), is by and between STONEMOR PARTNERS L.P., a Delaware limited partnership (the Partnership), and STONEMOR GP HOLDINGS LLC, a Delaware limited liability company (the Purchaser).
WHEREAS, the Partnership desires to issue and sell to the Purchaser, and the Purchaser desires to purchase from the Partnership, certain common units representing limited partner interests in the Partnership (Common Units) in accordance with the provisions of this Agreement.
NOW THEREFORE, in consideration of the mutual covenants and agreements set forth herein and for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Partnership and the Purchaser hereby agree as follows:
Section 1.1 Definitions. As used in this Agreement, and unless the context requires a different meaning, the following terms have the meanings indicated:
Affiliate means, with respect to any Person, any other Person that directly or indirectly through one or more intermediaries controls, is controlled by or is under common control with, the Person in question. As used herein, the term control means the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of a Person, whether through ownership of voting securities, by contract or otherwise. Notwithstanding the foregoing, for purposes of this Agreement, the Partnership and the Purchaser shall not be deemed to be Affiliates.
Agreement has the meaning set forth in the introductory paragraph.
Closing has the meaning specified in Section 2.2.
Closing Date has the meaning specified in Section 2.2.
Commission means the United States Securities and Exchange Commission.
Common Unit Price means $8.5731.
Common Units has the meaning specified in the recitals.
Company Purchase Agreement means the Common Unit Purchase Agreement dated as of the date hereof by and between the Purchaser and American Cemeteries Infrastructure Investors, LLC.
Exchange Act means the Securities Exchange Act of 1934, as amended from time to time, and the rules and regulations of the Commission promulgated thereunder.
General Partner means StoneMor GP LLC, a Delaware limited liability company and the general partner of the Partnership.
Governmental Authority means, with respect to a particular Person, any country, state, county, city and political subdivision in which such Person or such Persons Property is located or that exercises valid jurisdiction over any such Person or such Persons Property, and any court, agency, department, commission, board, bureau or instrumentality of any of them and any monetary authority that exercises valid jurisdiction over any such Person or such Persons Property. Unless otherwise specified, all references to Governmental Authority herein with respect to the Partnership mean a Governmental Authority having jurisdiction over the Partnership, its Subsidiaries or any of their respective Properties.
Indemnified Party has the meaning specified in Section 6.3.
Indemnifying Party has the meaning specified in Section 6.3.
Knowledge shall mean, with respect to any party, the actual knowledge of the managers, directors or executive officers of such party or such partys managing member, as applicable.
Law means any federal, state, local or foreign order, writ, injunction, judgment, settlement, award, decree, statute, law, rule or regulation.
Lien means any interest in Property securing an obligation owed to, or a claim by a Person other than the owner of the Property, whether such interest is based on the common law, statute or contract, and whether such obligation or claim is fixed or contingent, and including any lien or security interest arising from a mortgage, encumbrance, pledge, security agreement, conditional sale or trust receipt or a lease, consignment or bailment for security purposes.
Material Adverse Effect means a material adverse effect on (i) the financial condition, business, assets or results of operations of the Partnership Entities and their Subsidiaries, taken as a whole, and (ii) the ability of the Partnership to perform its obligations under this Agreement in full. Notwithstanding the foregoing, a Material Adverse Effect shall not include any effect resulting or arising from: (a) any change in general economic conditions in the industries or markets in which any of the Partnership Entities and their Subsidiaries operate that do not have a disproportionate effect on the Partnership Entities and their Subsidiaries, taken as a whole; (b) any engagement in hostilities pursuant to a declaration of war, or the occurrence of any military or terrorist attack; (c) changes in GAAP or other accounting principles, except to the extent such change has a disproportionate effect on the Partnership Entities and their Subsidiaries, taken as a whole; or (d) the announcement and pendency of the transactions contemplated hereby.
NYSE means The New York Stock Exchange, Inc.
Outstanding has the meaning set forth in the Partnership Agreement.
Partnership has the meaning set forth in the introductory paragraph.
Partnership Agreement means the Second Amended and Restated Agreement of Limited Partnership of the Partnership dated September 9, 2008, including any amendments thereto.
Partnership Entities and each a Partnership Entity means the General Partner and the Partnership.
Partnership Related Parties has the meaning specified in Section 6.2.
Person means an individual or a corporation, limited liability company, partnership, joint venture, trust, unincorporated organization, association, government agency or political subdivision thereof or other form of entity.
Per Unit Capital Amount has the meaning set forth in the Partnership Agreement.
Property means any interest in any kind of property or asset, whether real, personal or mixed, or tangible or intangible.
Purchase Price means $20.0 million.
Purchased Units means the number of Common Units equal to the Purchase Price hereto divided by the Common Unit Price.
Purchaser has the meaning set forth in the introductory paragraph.
Purchaser Related Parties has the meaning specified in Section 6.1.
Registration Rights Agreement means that certain Registration Rights Agreement dated as of May 21, 2014, by and between the Partnership and American Cemeteries Infrastructure Investors, LLC.
Representatives of any Person means the Affiliates, officers, directors, managers, employees, agents, counsel, accountants, investment bankers and other representatives of such Person.
Securities Act means the Securities Act of 1933, as amended from time to time, and the rules and regulations of the Commission promulgated thereunder.
Subsidiary has the meaning set forth in Rule 405 of the rules and regulations promulgated under the Securities Act.
Unrealized Gain has the meaning set forth in the Partnership Agreement.
AGREEMENT TO SELL AND PURCHASE
Section 2.1 Sale and Purchase. Subject to the terms and conditions hereof, the Partnership hereby agrees to issue and sell to the Purchaser and the Purchaser hereby agrees to purchase from the Partnership, the Purchased Units, and the Purchaser agrees to pay the Partnership the Common Unit Price for each Purchased Unit.
Section 2.2 Closing. Subject to the terms and conditions hereof, the closing of the transactions contemplated under this Agreement (the Closing) shall take place on the date hereof (the Closing Date). The parties agree that the Closing may occur via delivery of .pdf of facsimile copies of the documents referred to herein.
Section 2.3 Deliveries by the Partnership. At the Closing, subject to the terms and conditions hereof, the Partnership will deliver, or cause to be delivered, to the Purchaser evidence of issuance of the Purchased Units credited to a book-entry account maintained by the transfer agent, bearing the restrictive notation set forth in Section 4.8, and meeting the requirements of the Partnership Agreement, free and clear of any Liens, other than transfer restrictions under the Partnership Agreement and applicable federal and state securities laws.
Section 2.4 Purchaser Deliveries. At the Closing, subject to the terms and conditions hereof, the Purchaser will deliver, or cause to be delivered, to the Partnership:
(a) payment to the Partnership of the Purchase Price by wire transfer of immediately available funds to an account designated by Partnership; and
(b) an application requesting admission as an Additional Limited Partner (as that term is defined in the Partnership Agreement) in substantially the form attached hereto as Exhibit A, which shall have been duly executed by the Purchaser.
REPRESENTATIONS AND WARRANTIES OF THE PARTNERSHIP
The Partnership represents and warrants to the Purchaser as follows:
Section 3.1 Existence. Each of the Partnership Entities has been duly formed and is validly existing as a limited liability company or limited partnership, as the case may be, in good standing under the laws of its jurisdiction of formation with all limited liability company or limited partnership power and authority necessary to own or hold its properties and to conduct the businesses in which it is engaged, and, in the case of the General Partner, to act as the general partner of the Partnership.
Section 3.2 Purchased Units: Capitalization.
(a) The Purchased Units have those rights, preferences, privileges and restrictions governing the Common Units as set forth in the Partnership Agreement.
(b) As of the date hereof and prior to the issuance and sale of the Purchased Units, the issued and outstanding limited partner interests of the Partnership consist of 35,530,618 Common Units. All outstanding Common Units have been duly authorized and validly issued in accordance with the Partnership Agreement and are fully paid (to the extent required under the Partnership Agreement) and nonassessable (except as such nonassessability may be affected by matters described in Sections 17-303, 17-607 and 17-804 of the Delaware LP Act).
(c) The Common Units are listed on the NYSE, and the Partnership has not received any notice of delisting.
Section 3.3 No Conflict. None of the offering, issuance and sale by the Partnership of the Purchased Units and the application of the proceeds therefrom, the execution, delivery and performance of this Agreement by the Partnership, or the consummation of the transactions contemplated hereby (i) conflicts or will conflict with, or constitutes or will constitute a violation of, the certificate or agreement of limited partnership, certificate of formation, limited liability company agreement or other organizational documents of the Partnership Entities, (ii) conflicts or will conflict with, or constitutes or will constitute a breach or violation of or a default under (or an event that, with notice or lapse of time or both, would constitute such a breach or violation of or default under), any indenture, mortgage, deed of trust, loan agreement, lease or other agreement or instrument to which any Partnership Entity or any material Subsidiary of a Partnership Entity is a party, by which any of them is bound or to which any of their respective properties or assets is subject, (iii) violates or will violate any statute, law, ordinance, regulation, order, judgment, decree or injunction of any court or governmental agency or body to which any Partnership Entity or any material Subsidiary of a Partnership Entity, or any of their respective properties or assets may be subject or (iv) will result in the creation or imposition of any Lien upon any property or assets of any Partnership Entity or any material Subsidiary of any Partnership Entity, which conflicts, breaches, violations, defaults or Liens, in the case of clauses (ii), (iii) or (iv), would, individually or in the aggregate, have a Material Adverse Effect.
Section 3.4 Authority. The Partnership has all requisite power and authority to issue, sell and deliver the Purchased Units, in accordance with and upon the terms and conditions set forth in this Agreement and the Partnership Agreement. All partnership or limited liability company action, as the case may be, required to be taken by the General Partner and the Partnership for the authorization, issuance, sale and delivery of the Purchased Units, the execution and delivery of this Agreement and the consummation of the transactions contemplated hereby has been validly taken. No approval from the holders of outstanding Common Units is required under the Partnership Agreement or the rules of the NYSE in connection with the Partnerships issuance and sale of the Purchased Units to the Purchaser.
Section 3.5 Approvals. No permit, consent, approval, authorization, order, registration, filing or qualification (consent) of or with any court, governmental agency or body having jurisdiction over any of the Partnership Entities or any material Subsidiary of any Partnership Entity, or any of their respective properties is required in connection with the offering and sale of the Purchased Units in the manner contemplated by this Agreement, the execution, delivery and performance of this Agreement by the Partnership Entities, or the consummation of the transactions contemplated by this Agreement, except for such consents (i)
required under the Securities Act and state securities or Blue Sky laws or (ii) that, if not obtained, would not, individually or in the aggregate, have a Material Adverse Effect.
Section 3.6 Compliance with Laws. As of the date hereof, neither the Partnership nor any of its Subsidiaries is in violation of any Law applicable to the Partnership or its Subsidiaries, except as would not, individually or in the aggregate, have a Material Adverse Effect. The Partnership and its Subsidiaries possess all certificates, authorizations and permits issued by the appropriate regulatory authorities necessary to conduct their respective businesses, except where the failure to possess such certificates, authorizations or permits would not, individually or in the aggregate, have a Material Adverse Effect, and neither the Partnership nor any such Subsidiary has received any notice of proceedings relating to the revocation or modification of any such certificate, authorization or permit, except where such potential revocation or modification would not, individually or in the aggregate, have a Material Adverse Effect.
Section 3.7 Due Authorization. This Agreement has been duly and validly authorized and has been validly executed and delivered by the Partnership and constitutes (assuming the due authorization, execution and delivery by the other party hereto) the legal, valid and binding obligations of the Partnership enforceable in accordance with its terms, except as such enforceability may be limited by bankruptcy, insolvency, fraudulent transfer and similar laws affecting creditors rights generally or by general principles of equity, including principles of commercial reasonableness, fair dealing and good faith.
Section 3.8 Valid Issuance; No Options or Preemptive Rights. The Purchased Units to be issued and sold by the Partnership to the Purchaser hereunder have been duly authorized in accordance with the Partnership Agreement and, when issued and delivered to the Purchaser against payment therefor pursuant to this Agreement, will be validly issued in accordance with the Partnership Agreement, fully paid (to the extent required under the Partnership Agreement) and non-assessable (except as such nonassessability may be affected by matters described in Sections 17-303, 17-607 and 17-804 of the Delaware LP Act). The holders of outstanding Common Units are not entitled to statutory, preemptive or other similar contractual rights to subscribe for Common Units other than as provided in the Partnership Agreement; and no options, warrants or other rights to purchase, agreements or other obligations to issue, or rights to convert any obligations into or exchange any securities for, partnership securities or ownership interests in the Partnership are outstanding, except as provided for in the Partnership Agreement or grants outstanding under an employee benefit plan.
Section 3.9 No Registration Rights. Except as disclosed in the Partnerships reports filed under the Exchange Act and as contemplated by this Agreement, the Partnership Agreement and the Registration Rights Agreement, there are no contracts, agreements or understandings between the Partnership and any Person granting such Person the right to require the Partnership to file a registration statement under the Securities Act with respect to any securities of the Partnership or to require the Partnership to add such securities to any securities registered or to be registered pursuant to any registration statement filed by or required to be filed by the Partnership under the Securities Act.
Section 3.10 Periodic Reports. The Partnership has filed all forms, reports, schedules and statements required to be filed by it under the Exchange Act since December 31, 2015 (the SEC Documents) and when they were filed with the Commission, or to the extent corrected or updated by a subsequent amendment or restatement filed with the Commission, then as so corrected or updated, each such form, report, schedule and statement (i) conformed in all material respects to the requirements of the Exchange Act, and (ii) did not knowingly contain an untrue statement of a material fact or omit to state a material fact necessary in order to make the statements made, in the light of the circumstances under which they were made therein, not misleading; provided the Purchaser did not have Knowledge of such untrue statement or omission as of the date of such filing, or amendment thereto or restatement thereof, with the Commission.
Section 3.11 Litigation. Except (i) for proceedings of which the Purchaser or any of its Representatives is aware, or (ii) as disclosed in the Partnerships reports filed under the Exchange Act, as of the date hereof, there are no legal or governmental proceedings pending to which any Partnership Entity is a party or to which any Property or asset of any Partnership Entity is subject that could reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect or which challenge the validity of this Agreement or the right of any Partnership Entity to enter into this Agreement or to consummate the transactions contemplated hereby and, to the Knowledge of the Partnership, no such proceedings are threatened by Governmental Authorities or others.
Section 3.12 No Side Agreements. Other than the Company Purchase Agreement, there are no agreements by, among or between the Partnership or any of its Affiliates, on the one hand, and the Purchaser or any of its Affiliates, on the other hand, with respect to the transactions contemplated hereby nor promises or inducements for future transactions between or among any of such parties.
Section 3.13 No Registration Required. Assuming the accuracy of the representations and warranties of the Purchaser contained in Section 4.5 and Section 4.6, the issuance and sale of the Purchased Units pursuant to this Agreement is exempt from registration requirements of the Securities Act, and neither the Partnership nor, to the knowledge of the Partnership, any authorized Representative acting on its behalf has taken or will take any action hereafter that would cause the loss of such exemption.
Section 3.14 MLP Status. The Partnership is properly treated as a partnership for United States federal income tax purposes and more than 90% of the Partnerships current gross income is qualifying income under 7704(d) of the Internal Revenue Code of 1986, as amended.
REPRESENTATIONS AND WARRANTIES OF THE PURCHASER
The Purchaser hereby represents and warrants to the Partnership that:
Section 4.1 Existence, Capacity, Authorization and Enforceability. The Purchaser (i) is duly organized, validly existing and in good standing under the Laws of its jurisdiction of
organization and (ii) has the requisite power, and has all material governmental licenses, authorizations, consents and approvals necessary to own its Properties and carry on its business as its business is now being conducted. The Purchaser has all requisite limited liability company or other similar entity power and authority to execute, deliver and perform its obligations under this Agreement and to consummate the transactions contemplated hereby. All limited liability company action required to be taken by the Purchaser for the execution and delivery of this Agreement and the consummation of the transactions contemplated hereby has been validly taken. This Agreement has been duly and validly authorized and has been validly executed and delivered by the Purchaser, and constitutes (assuming the due authorization, execution and delivery by the other party hereto), the legal, valid and binding obligations of the Purchaser, enforceable in accordance with its terms, except as such enforceability may be limited by bankruptcy, insolvency, fraudulent transfer and similar laws affecting creditors rights generally or by general principles of equity, including principles of commercial reasonableness, fair dealing and good faith.
Section 4.2 No Conflict. The execution, delivery and performance of this Agreement by the Purchaser and the consummation by the Purchaser of the transactions contemplated hereby will not (a) conflict with or result in a breach or violation of any of the terms or provisions of, or constitute a default under, any material agreement to which the Purchaser is a party or by which the Purchaser is bound or to which any of the property or assets of the Purchaser is subject, (b) violate any statute, order, rule or regulation of any court or governmental agency or body having jurisdiction over the Purchaser or the property or assets of the Purchaser, or (c) conflict with or result in any violation of the provisions of the organizational documents of the Purchaser, except in the cases of clauses (a) and (b), for such conflicts, breaches, violations or defaults as would not prevent the consummation of the transactions contemplated by this Agreement and the performance of the Purchasers obligations under this Agreement.
Section 4.3 Certain Fees. No fees or commissions are or will be payable by the Purchaser to brokers, finders, or investment bankers with respect to the purchase of any of the Purchased Units or the consummation of the transactions contemplated by this Agreement. The Purchaser agrees that it will indemnify and hold harmless the Partnership from and against any and all claims, demands, or liabilities for brokers, finders, placement, or other similar fees or commissions incurred by the Purchaser in connection with the purchase of the Purchased Units or the consummation of the transactions contemplated by this Agreement.
Section 4.4 No Side Agreements. Other than the Company Purchase Agreement, there are no other agreements by, among or between the Purchaser and any of its Affiliates, on the one hand, and the Partnership or any of its Affiliates, on the other hand, with respect to the transactions contemplated hereby nor promises or inducements for future transactions between or among any of such parties.
Section 4.5 Investment. The Purchased Units are being acquired for the Purchasers own account, not as a nominee or agent, and with no present intention of distributing the Purchased Units or any part thereof, and the Purchaser has no present intention of selling or granting any participation in or otherwise distributing the same in any transaction in violation of the securities laws of the United States or any state, without prejudice, subject however, to the
Purchasers right at all times to sell or otherwise dispose of all or any part of the Purchased Units under a registration statement under the Securities Act and applicable state securities laws or under an exemption from such registration available thereunder (including, without limitation, if available, Rule 144 promulgated thereunder). If the Purchaser should in the future decide to dispose of any of the Purchased Units, the Purchaser understands and agrees (a) that it may do so only in compliance with the Securities Act and applicable state securities law, as then in effect, including a sale contemplated by any registration statement pursuant to which such securities are being offered, or pursuant to an exemption from the Securities Act, and (b) that stop-transfer instructions to that effect will be in effect with respect to such securities.
Section 4.6 Nature of Purchaser. The Purchaser represents and warrants to, and covenants and agrees with, the Partnership that (a) the Purchaser is an -accredited investor- as defined in Rule 501 of Regulation D promulgated by the Commission pursuant to the Securities Act, (b) by reason of its business and financial experience, the Purchaser has such knowledge, sophistication and experience in making similar investments and in business and financial matters so as to be capable of evaluating the merits and risks of the prospective investment in the Purchased Units, is able to bear the economic risk of such investment and, at the present time, would be able to afford a complete loss of such investment, and (c) it is acquiring the Purchased Units only for its own account and not for the account of others, for investment purposes and not on behalf of any other account or Person or with a view to, or for offer or sale in connection with, any distribution thereof. The Purchaser acknowledges that it (i) has access to the SEC Documents, (ii) has been provided a reasonable opportunity to ask questions of and receive answers from Representatives of the Partnership or the General Partner regarding such matters and (iii) has sought such accounting, legal and tax advice as it has considered necessary to make an informed investment decision with respect to the acquisition of the Purchased Units.
Section 4.7 Restricted Securities. The Purchaser understands that the Purchased Units are characterized as restricted securities under the federal securities Laws in as much as they are being, or will be, as applicable, acquired from the Partnership in a transaction not involving a public offering and that under such Laws and applicable regulations such securities may be resold without registration under the Securities Act only in certain limited circumstances.
Section 4.8 Legend; Restrictive Notation. The Purchaser understands that the certificates evidencing the Purchased Units or the book-entry account maintained by the transfer agent evidencing ownership of the Purchased Units, as applicable, will bear the legend or restrictive notation required by the Partnership Agreement as well as the following legend or restrictive notation:
These securities have not been registered under the Securities Act or the securities laws of any state or other jurisdiction. These securities may not be sold or offered for sale, pledged or hypothecated except pursuant to an effective registration statement under the Securities Act or pursuant to an exemption from registration thereunder which, in the opinion of counsel for the holder, which counsel and opinion are reasonably satisfactory to the counsel for the Partnership, is available, in each case in accordance with all applicable securities laws of the states or other jurisdictions, and in the case of a transaction exempt from registration, such securities may only be transferred if the
transfer agent for such securities has received documentation satisfactory to it that such transaction does not require registration under the Securities Act.
Section 4.9 Reliance on Exemptions. The Purchaser understands that the Purchased Units are being offered and sold to the Purchaser in reliance upon specific exemptions from the registration requirements of United States federal and state securities laws and that the Partnership is relying upon the truth and accuracy of, and Purchasers compliance with, the representations, warranties, agreements, acknowledgments and understandings of Purchaser set forth herein in order to determine the availability of such exemptions and the eligibility of the Purchaser to acquire the Purchased Units.
Section 5.1 Further Assurances. Each of the parties hereto shall, at the request of any other party hereto, take such further actions as are requested and execute any additional documents, instruments or conveyances of any kind which may be reasonably necessary to further effect the transactions contemplated by this Agreement.
Section 6.1 Indemnification by the Partnership. The Partnership agrees to indemnify the Purchaser and its Representatives (collectively, Purchaser Related Parties) from, and hold each of them harmless against, any and all actions, suits, proceedings (including any investigations, litigation or inquiries), demands, and causes of action, and, in connection therewith, and promptly upon demand, pay or reimburse each of them for all costs, losses, liabilities, damages, or expenses of any kind or nature whatsoever, including, without limitation, the reasonable fees and disbursements of counsel and all other reasonable expenses incurred in connection with investigating, defending or preparing to defend any such matter that may be incurred by them or asserted against or involve any of them as a result of, arising out of, or in any way related to the breach of any of the representations, warranties or covenants of the Partnership contained herein, provided that such claim for indemnification relating to a breach of the representations or warranties is made prior to the expiration of such representations or warranties to the extent applicable; and provided further, that no Purchaser Related Party shall be entitled to recover special, consequential or punitive damages under this Section 6.1.
Section 6.2 Indemnification by Purchaser. The Purchaser agrees to indemnify the Partnership, the General Partner and their respective Representatives (collectively, Partnership Related Parties) from, and hold each of them harmless against, any and all actions, suits, proceedings (including any investigations, litigation or inquiries), demands, and causes of action, and, in connection therewith, and promptly upon demand, pay or reimburse each of them for all costs, losses, liabilities, damages, or expenses of any kind or nature whatsoever, including, without limitation, the reasonable fees and disbursements of counsel and all other reasonable expenses incurred in connection with investigating, defending or preparing to defend any such matter that may be incurred by them or asserted against or involve any of them as a result of, arising out of, or in any way related to the breach of any of the representations, warranties or
covenants of the Purchaser contained herein, provided that such claim for indemnification relating to a breach of the representations and warranties is made prior to the expiration of such representations and warranties to the extent applicable; and provided further, that no Partnership Related Party shall be entitled to recover special, consequential or punitive damages under this Section 6.2.
Section 6.3 Indemnification Procedure. Promptly after any Partnership Related Party or Purchaser Related Party (hereinafter, the Indemnified Party) has received notice of any indemnifiable claim hereunder, or the commencement of any action, suit or proceeding by a third person, which the Indemnified Party believes in good faith is an indemnifiable claim under this Agreement, the Indemnified Party shall give the indemnitor hereunder (the Indemnifying Party) written notice of such claim or the commencement of such action, suit or proceeding, but failure to so notify the Indemnifying Party will not relieve the Indemnifying Party from any liability it may have to such Indemnified Party hereunder except to the extent that the Indemnifying Party is materially prejudiced by such failure. Such notice shall state the nature and the basis of such claim to the extent then known. The Indemnifying Party shall have the right to defend and settle, at its own expense and by its own counsel who shall be reasonably acceptable to the Indemnified Party, any such matter as long as the Indemnifying Party pursues the same diligently and in good faith. If the Indemnifying Party undertakes to defend or settle, it shall promptly notify the Indemnified Party of its intention to do so, and the Indemnified Party shall cooperate with the Indemnifying Party and its counsel in all commercially reasonable respects in the defense thereof and the settlement thereof. Such cooperation shall include, but shall not be limited to, furnishing the Indemnifying Party with any books, records and other information reasonably requested by the Indemnifying Party and in the Indemnified Partys possession or control. Such cooperation of the Indemnified Party shall be at the cost of the Indemnifying Party. After the Indemnifying Party has notified the Indemnified Party of its intention to undertake to defend or settle any such asserted liability, and for so long as the Indemnifying Party diligently pursues such defense, the Indemnifying Party shall not be liable for any additional legal expenses incurred by the Indemnified Party in connection with any defense or settlement of such asserted liability; provided, however, that the Indemnified Party shall be entitled (a) at its expense, to participate in the defense of such asserted liability and the negotiations of the settlement thereof and (b) if (i) the Indemnifying Party has failed to assume the defense or employ counsel reasonably acceptable to the Indemnified Party or (ii) if the defendants in any such action include both the Indemnified Party and the Indemnifying Party and counsel to the Indemnified Party shall have concluded that there may be reasonable defenses available to the Indemnified Party that are different from or in addition to those available to the Indemnifying Party or if the interests of the Indemnified Party reasonably may be deemed to conflict with the interests of the Indemnifying Party, then the Indemnified Party shall have the right to select one separate counsel who shall be reasonably acceptable to the Indemnifying Party and to assume such legal defense and otherwise to participate in the defense of such action, with the expenses and fees of such separate counsel and other expenses related to such participation to be reimbursed by the Indemnifying Party as incurred. Notwithstanding any other provision of this Agreement, the Indemnifying Party shall not settle any indemnified claim without the consent of the Indemnified Party, unless the settlement thereof imposes no liability or obligation on, and includes a complete release from liability of, and does not include any admission of wrongdoing or malfeasance by, the Indemnified Party. The remedies provided for in this
Article VI are cumulative and are not exclusive of any remedies that may be available to a party at law or in equity or otherwise.
Section 7.1 Certain Special Allocations of Book and Taxable Income. To the extent that the Common Unit Price differs from the Per Unit Capital Amount as of the Closing Date for a then Outstanding Common Unit after taking into account the issuance of the Purchased Units, the General Partner intends to specially allocate Partnership items of book and taxable income, gain, loss or deduction to the Purchaser so that the Per Unit Capital Amount with respect to their Purchased Units are equal to the Per Unit Capital Amounts with respect to other Common Units (and thus to assure fungibility of all Common Units). Such special allocations will occur upon the earlier to occur of any taxable period of the Partnership ending upon, or after, (a) an event described in Section 5.5(d) of the Partnership Agreement or a sale of all or substantially all of the assets of the Partnership occurring after the date of the issuance of the Purchased Units, or (b) the transfer of the Purchased Units to a Person that is not an Affiliate of the Purchaser, in which case, such allocation shall be made only with respect to the Purchased Units so transferred. To the maximum extent permissible, the special allocations resulting from clause (a) will be made through allocations of Unrealized Gain.
Section 7.2 Interpretation and Severability. Article, Section, Schedule, and Exhibit references are to this Agreement, unless otherwise specified. All references to instruments, documents, contracts, and agreements are references to such instruments, documents, contracts, and agreements as the same may be amended, supplemented, and otherwise modified from time to time, unless otherwise specified. The word including shall mean including but not limited to. Whenever any party has an obligation under this Agreement, the expense of complying with that obligation shall be an expense of such party unless otherwise specified. Whenever any determination, consent, or approval is to be made or given by the Purchaser, such action shall be in the Purchasers sole discretion unless otherwise specified in this Agreement. If any provision in this Agreement is held to be illegal, invalid, not binding, or unenforceable, such provision shall be fully severable and this Agreement shall be construed and enforced as if such illegal, invalid, not binding, or unenforceable provision had never comprised a part of this Agreement, and the remaining provisions shall remain in full force and effect. This Agreement has been reviewed and negotiated by sophisticated parties with access to legal counsel and shall not be construed against the drafter.
Section 7.3 Survival of Provisions. The representations and warranties set forth in Sections 3.2, 3.3, 3.5, 3.8, 3.13, 3.14, 4.2, 4.3, 4.4, 4.5, 4.6, 4.7, 4.8 and 4.9 hereunder shall survive the execution and delivery of this Agreement indefinitely, and the other representations and warranties set forth herein shall survive for a period of twelve (12) months following the Closing Date regardless of any investigation made by or on behalf of the Partnership or the Purchaser. The covenants made in this Agreement shall survive the Closing of the transactions described herein and remain operative and in full force and effect. All indemnification obligations of the Partnership and the Purchaser pursuant to this Agreement and the provisions of Article VI shall remain operative and in full force and effect unless such obligations are
expressly terminated in a writing by the parties, regardless of any purported general termination of this Agreement.
Section 7.4 No Waiver; Modifications in Writing.
(a) Delay. No failure or delay on the part of any party in exercising any right, power, or remedy hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such right, power, or remedy preclude any other or further exercise thereof or the exercise of any other right, power, or remedy. The remedies provided for herein are cumulative and are not exclusive of any remedies that may be available to a party at law or in equity or otherwise.
(b) Amendments and Waivers. Except as otherwise provided herein, no amendment, waiver, consent, modification, or termination of any provision of this Agreement shall be effective unless signed by each of the parties hereto or thereto affected by such amendment, waiver, consent, modification, or termination. Any amendment, supplement or modification of or to any provision of this Agreement, any waiver of any provision of this Agreement, and any consent to any departure by the Partnership from the terms of any provision of this Agreement shall be effective only in the specific instance and for the specific purpose for which made or given. Except where notice is specifically required by this Agreement, no notice to or demand on the Partnership in any case shall entitle the Partnership to any other or further notice or demand in similar or other circumstances.
Section 7.5 Binding Effect; Assignment. This Agreement shall be binding upon the Partnership, the Purchaser, and their respective successors and permitted assigns. Except as expressly provided in this Agreement, this Agreement shall not be construed so as to confer any right or benefit upon any Person other than the parties to this Agreement and their respective successors and permitted assigns. All or any portion of the rights and obligations of the Purchaser under this Agreement may be transferred by the Purchaser to any Affiliate of the Purchaser without the consent of the Partnership.
Section 7.6 Communications. All notices and demands provided for hereunder shall be in writing and shall be given by registered or certified mail, return receipt requested, telecopy, air courier guaranteeing overnight delivery or personal delivery to the following addresses:
|(a)||If to the Purchaser:|
StoneMor GP Holdings LLC
3600 Horizon Boulevard
Trevose, PA 19053
Attention: Lawrence Miller
Telephone: (215) 826-2800
with a copy to:
American Infrastructure MLP Funds
950 Tower Lane, Suite 800
Foster City, CA 94404
Attention: Robert Hellman
|(b)||If to the Partnership:|
3600 Horizon Boulevard
Trevose, PA 19053
Attention: Austin So
Telephone: (215) 826-2800
or to such other address as the Partnership or the Purchaser may designate in writing. All notices and communications shall be deemed to have been duly given: at the time delivered by hand, if personally delivered; at the time of transmittal, if sent via electronic mail; upon actual receipt if sent by certified mail, return receipt requested, or regular mail, if mailed; when receipt acknowledged, if sent via facsimile; and upon actual receipt when delivered to an air courier guaranteeing overnight delivery.
Section 7.7 Removal of Legend. The Purchaser may request the Partnership to remove the legends described in Section 4.8 from the certificates evidencing the Purchased Units by submitting to the Partnership such certificates, together with an opinion of counsel, which counsel and opinion are reasonably satisfactory to the Partnership, to the effect that such legend is no longer required under the Securities Act or applicable state laws, as the case may be. The Partnership shall cooperate with the Purchaser to effect the removal of such legend.
Section 7.8 Entire Agreement. This Agreement and the other agreements and documents referred to herein are intended by the parties as a final expression of their agreement and intended to be a complete and exclusive statement of the agreement and understanding of the parties hereto in respect of the subject matter contained herein and therein. There are no restrictions, promises, warranties or undertakings, other than those set forth or referred to herein with respect to the rights granted by the Partnership or any of its Affiliates or the Purchaser or any of its Affiliates set forth herein or therein. This Agreement and the other agreements and documents referred to herein or therein supersede all prior agreements and understandings between the parties with respect to such subject matter.
Section 7.9 Governing Law. This Agreement will be construed in accordance with and governed by the laws of the State of Delaware without giving effect to any choice or conflict of law provision or rule (whether of the State of Delaware or any other jurisdiction) that would cause the application of laws of any jurisdiction other than those of the State of Delaware.
Section 7.10 Waiver of Jury Trial. EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING BETWEEN THE PARTIES HERETO ARISING OUT OF OR RELATED TO THIS AGREEMENT.
Section 7.11 Execution in Counterparts. This Agreement may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which counterparts, when so executed and delivered, shall be deemed to be an original and all of which counterparts, taken together, shall constitute but one and the same Agreement.
[Signature pages follow.]
IN WITNESS WHEREOF, the parties hereto execute this Agreement, effective as of the date first above written.
|STONEMOR PARTNERS L.P.|
StoneMor GP LLC,
its General Partner
|Name:||Sean P. McGrath|
|Title:||Chief Financial Officer|
[Signature Page to Common Unit Purchase Agreement]
|STONEMOR GP HOLDINGS LLC|
|Title:||President and Chief Executive Officer|
[Signature Page to Common Unit Purchase Agreement]
Form of Additional Limited Partner Certificate
The undersigned (the Investor) hereby applies for issuance in the name of the Investor of the Common Units evidenced hereby.
The Investor (a) requests admission as an Additional Limited Partner and agrees to comply with and be bound by, and hereby executes, the Second Amended and Restated Agreement of Limited Partnership of StoneMor Partners L.P. (the Partnership), as amended, supplemented or restated to the date hereof (the Partnership Agreement), (b) represents and warrants that the Investor has all right, power and authority and, if an individual, the capacity necessary to enter into the Partnership Agreement, (c) appoints the General Partner of the Partnership and, if a Liquidator shall be appointed, the Liquidator of the Partnership as the Investors attorney-in-fact to execute, swear to, acknowledge and file any document, including, without limitation, the Partnership Agreement and any amendment thereto and the Certificate of Limited Partnership of the Partnership and any amendment thereto, necessary or appropriate for the Investors admission as an Additional Limited Partner and as a party to the Partnership Agreement, (d) gives the powers of attorney provided for in the Partnership Agreement, (e) makes the waivers and gives the consents and approvals contained in the Partnership Agreement and (f) certifies to the Partnership that the Investor (including, to the best of the Investors knowledge, any person for whom the Investor will hold the Common Units) is an Eligible Citizen. Capitalized terms not defined herein have the meanings assigned to such terms in the Partnership Agreement.
Social Security or other identifying number
Signature of Investor
Purchase Price including commissions, if any
Name and Address of Investor
Type of Entity (check one):
|Nationality (check one):|
|☐||U.S. Citizen, Resident or Domestic Entity|
|☐||Foreign Corporation||☐||Non-resident Alien|
|If the U.S. Citizen, Resident or Domestic Entity box is checked, the following certification must be completed.|
Exhibit A to the Common Unit Purchase Agreement
Under Section 1445(e) of the Internal Revenue Code of 1986, as amended (the Code), the Partnership must withhold tax with respect to certain transfers of property if a holder of an interest in the Partnership is a foreign person. To inform the Partnership that no withholding is required with respect to the undersigned interestholders interest in it, the undersigned hereby certifies the following (or, if applicable, certifies the following on behalf of the interestholder).
Complete Either A or B:
|1.||I am not a non-resident alien for purposes of U.S. income taxation.|
|2.||My U.S. taxpayer identification number (Social Security Number) is .|
|3.||My home address is .|
|B.||Partnership, Corporation or Other Interestholder|
|1.||is not a foreign corporation, foreign partnership, foreign trust or foreign estate (as those terms are defined in the Code and Treasury Regulations).|
|2.||The interestholders U.S. employer identification number is .|
|3.||The interestholders office address and place of incorporation (if applicable) is .|
|4.||The interestholders year end for tax reporting purposes is: .|
The interestholder agrees to notify the Partnership within sixty (60) days of the date the interestholder becomes a foreign person.
The interestholder understands that this certificate may be disclosed to the Internal Revenue Service by the Partnership and that any false statement contained herein could be punishable by fine, imprisonment or both.
Under penalties of perjury, I declare that I have examined this certification and to the best of my knowledge and belief it is true, correct and complete and, if applicable, I further declare that I have authority to sign this document on behalf of:
|Name of Interestholder|
|Signature and Date|
|Title (if applicable)|
Exhibit A to the Common Unit Purchase Agreement
Note: If the Investor is a broker, dealer, bank, trust company, clearing corporation, other nominee holder or an agent of any of the foregoing, and is holding for the account of any other person, this application should be completed by an officer thereof or, in the case of a broker or dealer, by a registered representative who is a member of a registered national securities exchange or a member of the Financial Industry Regulatory Authority, or, in the case of any other nominee holder, a person performing a similar function. If the Investor is a broker, dealer, bank, trust company, clearing corporation, other nominee owner or an agent of any of the foregoing, the above certification as to any person for whom the Investor will hold the Common Units shall be made to the best of the Investors knowledge.
Exhibit A to the Common Unit Purchase Agreement