<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
UNDER THE SECURITIES EXCHANGE ACT OF 1934
(AMENDMENT NO. 8 )*
------
MHI Group, Inc.
------------------
(Name of Issuer)
Common Stock, Par Value $.40 Per Share
---------------------------------------
(Title of Class of Securities)
0006073860
----------
(CUSIP Number)
Mr. George A. Kellner Meredith M. Brown
MH Associates Debevoise & Plimpton
900 Third Avenue, 10th Floor 875 Third Avenu
New York, NY 10022 New York, NY 10022
(212) 350-0200 (212) 909-6528
--------------------------------------------------------------------------------
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
August 9, 1995
--------------------------------------------------------------------------------
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(b)(3) or (4), check the following box ___.
Check the following box if a fee is being paid with the statement ___. (A fee
is not required only if the reporting person: (1) has a previous statement on
file reporting beneficial ownership of more than five percent of the class of
securities described in Item 1; and (2) has filed no amendment subsequent
thereto reporting beneficial ownership of five percent or less of such class.)
(See Rule 13d-7.)
NOTE: Six copies of this statement, including all exhibits, should be filed
with the Commission. See Rule 13d-1(a) for other parties to whom copies are to
be sent.
*The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 (the "Act") or otherwise subject to the liabilities of that section of the
Act but shall be subject to all other provisions of the Act (however, see the
Notes).
<PAGE>
Page 2 of 29
CUSIP No. 0006073860
--------------------------------------------------------------------------------
1. NAME OF REPORTING PERSON
S.S OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
MH Associates
--------------------------------------------------------------------------------
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) ___
(b) ___
--------------------------------------------------------------------------------
3. SEC USE ONLY
--------------------------------------------------------------------------------
4. SOURCE OF FUND AF
--------------------------------------------------------------------------------
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS
2(d) OR 2(e)
--------------------------------------------------------------------------------
6. CITIZENSHIP OR PLACE OF ORGANIZATION
New York
--------------------------------------------------------------------------------
NUMBER OF 7. SOLE VOTING POWER
SHARES ---------------------------------------------------------
BENEFICIALLY 8. SHARED VOTING POWER
OWNED BY EACH ---------------------------------------------------------
REPORTING 9. SOLE DISPOSITIVE POWER
PERSON ---------------------------------------------------------
WITH 10. SHARED DISPOSITIVE POWER
----------------------------------------------------------
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
PERSON
486,352
--------------------------------------------------------------------------------
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
--------------------------------------------------------------------------------
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
7.2%
--------------------------------------------------------------------------------
14. TYPE OF REPORTING PERSON
PN
<PAGE>
MH Associates, a New York general partnership, by this eighth amendment to
its Schedule 13D, filed with the Securities and Exchange Commission on June 16,
1986 and amended on June 4, 1987, September 1, 1987, February 19, 1988, May 19,
1988, November 11, 1988, October 31, 1990 and October 9, 1992 with respect to
the Common Stock, par value $.40 (the "Common Stock"), of MHI Group, Inc. (the
"Company"), formerly named Mobile Home Industries, Inc., amends and restates its
Schedule 13D previously filed and supplements Items 4 and 6 thereof by the
addition of the two final paragraphs in Item 4 and the final paragraph of Item 6
and amends Item 7 thereof by adding the description of Exhibit 13 after the
description of Exhibit 12.
Item 1. Security and Issue.
------------------
This statement relates to the Common Stock of the Company underlying the
option to purchase shares of Common Stock described in Item 6 hereof (the
"Option"). The address of the principal executive offices of the Company is
2032-D Thomasville Road, Tallahassee, Florida 32312.
Item 2. Identity and Background.
-----------------------
(a) The name of the person filing this statement is MH Associates, a New
York general partnership.
Page 3 of 29
<PAGE>
(b) The principal executive office of MH Associ ates is located at 900
Third Avenue, New York, New York 10022.
(c) MH Associates is a private investment vehicle formed for the purpose
of holding the investment in the Company's securities of certain of the general
partners and affiliates of Kellner, DiLeo & Co. ("Kellner, DiLeo"). Kellner,
DiLeo is a New York limited partnership engaged primarily in risk arbitrage
transactions and related trading in options and securities as a member firm of
the New York Stock Exchange and other leading securities exchanges.
(d) Annex 1 attached to this statement sets forth the name, business
address, and present principal occupation or employment of each general partner
of MH Associates.
(e) Neither MH Associates nor (to the best of MH Associates' knowledge)
any partner of MH Associates has, during the last five years (i) been convicted
in a criminal proceeding (excluding traffic violations or similar misdemeanors)
or (ii) been a party to a civil proceeding of a judicial or administrative body
of competent jurisdiction and as a result of such proceeding was or is subject
to a judgment, decree or final order enjoining future violations of, or
prohibiting activities subject to, federal or state securities laws or finding
liability with respect to such laws.
Page 4 of 29
<PAGE>
(f) MH Associates is a New York general partner ship. All of its partners
are U.S. citizens.
Item 3. Source and Amount of Funds or Other Consideration.
-------------------------------------------------
The aggregate purchase price of the Option was $475,000 of which MH
Associates paid $308,700 and paid the remainder upon receipt of stockholder
approval of the Option. The cash portion of such purchase price was obtained
through capital contributions by the partners of MH Associates.
If the Option is exercised, MH Associates expects that it would obtain the
required funds from a combination of capital contributions from its partners and
margin bor rowings secured by the purchased shares.
On September 1, 1987, MH Associates acquired $800,000 aggregate principal
amount of the Company's 4% Convertible Subordinated Notes (the "Subordinated
Notes") and 19,000 shares of Series D Convertible Preferred Stock (the "Series D
Preferred Stock"), which Subordinated Notes and shares of Series D Preferred
Stock are convertible into an aggregate of 1,900,000 shares of Common Stock
(subject to certain anti-dilution adjustments). The Subordinated Notes and
shares of Series D Preferred Stock were issued to MH Associates in consideration
of its release of certain secured and unsecured loans and advances theretofore
made to
Page 5 of 29
<PAGE>
the Company by MH Associates, as more fully described under Item 4 below, which
loans and advances were funded by cash contributions to the capital of MH
Associates theretofore made by its partners.
Item 4. Purpose of Transaction.
----------------------
MH Associates' purpose in purchasing the Option from KD Equities was to
hold the Option in an investment vehicle separate from KD Equities. KD
Equities, the seller of the Option, is also a New York general partnership,
which serves as a private equity investment vehicle for the general partners of
Kellner, DiLeo. All of the partners of MH Associates are (or were) partners or
employees of Kellner, DiLeo or KD Equities or both.
Pursuant to a letter agreement between KD Equities and the Company, dated
April 22, 1986 and attached hereto as Exhibit 1 (the "Engagement Letter"), KD
Equities was retained by the Company to advise it in connection with a possible
acquisition transaction (the "Acquisition") and the Company agreed, among other
things, to grant the Option to KD Equities. If the Acquisition is completed, KD
Equities or an affiliate would receive, subject to the approval of the Company's
stockholders, an additional 15% of the outstanding shares of the Common Stock,
on a fully diluted basis. KD Equities has assigned the right to receive such
Page 6 of 29
<PAGE>
shares to MH Associates, pursuant to the Letter Agreement referred to below.
Pursuant to the Engagement Letter, KD Equities had the right to select two
persons for election to the Company's Board of Directors for as long as KD
Equities or its affiliates continue to hold, or hold the right to acquire, 10%
or more of the Company's outstanding Common Stock on a fully diluted basis.
At a meeting of the Company's Board of Directors held on June 6, 1986,
George A. Kellner and Roger E. Alcaly, managing and general partners,
respectively, of Kellner, DiLeo and KD Equities, were appointed to fill newly-
created seats on the Company's Board of Directors. Messrs. Kellner and Alcaly
together with Marion H. Antonini, a general partner of KD Equities, have been
nominated and will stand for election to the Company's Board of Directors at the
Company's next Annual Meeting.
Pursuant to a letter agreement between KD Equities and MH Associates, dated
as of June 6, 1986 and attached hereto as Exhibit 4 (the "Letter Agreement"), KD
Equities assigned to MH Associates its right to receive Common Stock, pursuant
to the Option and the Engagement Letter. Pursuant to the Letter Agreement, MH
Associates reimbursed KD Equities for $308,708 previously paid by KD Equities in
respect of the Option, and assumed KD Equities' obligation
Page 7 of 29
<PAGE>
to pay an additional $166,292 upon receipt of stockholder approval of the
Option.
MH Associates intends to continuously review its position in the Company,
and may, depending on its evaluation of the Company's business and prospects
and upon future developments, determine to increase or decrease or dispose of
its position in the Company. In making any such determination, MH Associates
will also take into consideration other business opportunities available to it,
developments with respect to its business, general economic conditions and
money and stock market conditions.
Except as set forth herein, MH Associates and its affiliates have no plans
or proposals which relate to or would result in an extraordinary corporate
transaction such as a merger, reorganization or liquidation of the Company or
any of its subsidiaries, a sale of a material amount of the assets of the
Company or any of its subsidiaries, a material change in the Company's
capitalization or dividend policy, or any other material changes in the
Company's business or corporate structure.
MH Associates had made certain advances to the Company for working capital
purposes and, in connection with the proposed acquisition by the Company of Star
of David Memorial Gardens Cemetery and Funeral Chapel (through the Company's
subsidiary, Funeral Services Acquisition Group),
Page 8 of 29
<PAGE>
had loaned the Company $1,000,000 and had committed to make further advances to
the Company in amounts sufficient to effect the closing of such acquisition. In
order to facilitate the closing of such acquisition on terms and conditions
satisfactory to the Company's lending bank (which acquisition was consummated on
September 1, 1987), MH Associates agreed to subordinate the Company's obligation
to repay such loans and advances to its obligation to repay the amounts to be
loaned by such bank in consideration of the issuance by the Company to MH
Associates of the Subordinated Notes and shares of Series D Preferred Stock.
See Item 6 as to the terms of the 1987 Letter Agreement, including the possible
sale by MH Associates of its securities in the Company under certain
circumstances.
MH Associates sent to the Company a letter dated November 7, 1988 as to the
election or appointment of four persons nominated by MH Associates to the
Company's board of directors. A copy of the letter is filed as Exhibit 9 and is
incorporated herein by reference. MH Associates, as sole shareholder of the
Company's Series D Preferred Stock, delivered to the Company a written consent
to the election of Messrs. George A. Kellner and Robert T. Mathis as directors,
pursuant to provisions in the Certificate of Designation of Rights and
Preferences with respect to such stock entitling its holders to cause the
election of two
Page 9 of 29
<PAGE>
directors if dividends on the Series D Preferred Stock of the Company were in
arrears for more than two quarterly periods. In addition, pursuant to the 1987
Letter Agreement, MH Associates requested the Company to appoint Messrs. Marion
H. Antonini and Joseph S. Dresner to the board of directors of the Company
pending the next meeting of the Company's stockholders.
On October 26, 1990, the Company and MH Associates entered into two
agreements. Pursuant to the Securities Exchange and Note Agreement (the "Note
Agreement"), the Company and MH Associates have agreed to exchange 10,000 shares
of Series D Convertible Preferred Stock of the Company (the "Preferred Stock")
and $1,100,000 face amount of 4% Subordinated Notes of the Company due September
1, 1992 (the "4% Notes") each held by MH Associates for $2,100,000 in face
amount of 10% Subordinated Notes of the Company with a final maturity of
December 31, 1996 ("New Notes"). A form of a New Note is attached as Exhibit A
to the Note Agreement. The Closing under the Note Agreement occurred on October
26, 1990. The description of the Note Agreement contained herein is qualified
in its entirety by reference to the Note Agreement, a copy of which, together
with a form of a New Note, is attached as Exhibit 10, which is incorporated
herein by reference.
Page 10 of 29
<PAGE>
In addition, the Note Agreement provides that the Letter Agreement, dated
August 31, 1987, between the Company and MH Associates (the "August 31
Agreement") is amended, effective at the next meeting of the board of directors
of the Company (the "Board"), to provide that the Board agrees to nominate and
recommend for election to the Board by its stockholders and by appointment
pending the next meeting of the Company's stockholders (subject to the fiduciary
duties of the Board under applicable law) one person designated by the holders
of a majority of the New Notes.
Previously, the August 31 Agreement had provided for a minimum of two
directors to be nominated and recommended by the Board designated by the
holders of a majority of the aggregate value of the Preferred Stock and the 4%
Notes. One of those directors, Marion H. Antonini, resigned from the Board on
September 1, 1990 and has not been replaced. In implementing of this change,
and as a result of the exchange of the Preferred Stock (which Preferred Stock
had provided the holders thereof with a special right to vote as a class for two
directors of the Company when dividends on the Preferred Stock were in arrears
an aggregate amount equal to two full quarterly dividends), directors selected
by MH Associates, Messrs. George A. Kellner, Joseph S. Dresner and William T.
Warburton, either, in the case of Messrs. Kellner and Warburton, resigned as
directors of the
Page 11 of 29
<PAGE>
Company effective at the Closing under the Note Agreement, or, in the case of
Mr. Dresner, resigned as a director effective at the next meeting of the Board.
At that time, Mr. Kellner rejoined the Board as the director appointed pursuant
to the August 31 Agreement.
Pursuant to the Option Amendment Agreement (the "Amendment Agreement"), the
Company and MH Associates have agreed to change certain of the terms of a Stock
Option Agreement, dated as of April 22, 1986 (the "Option Agreement") which
provided MH Associates with options to purchase 1,900,000 shares of Common Stock
at any time prior to April 22, 1991 at an option price of $1.46 per share in
cash (the "Option"). As amended pursuant to the Amendment Agreement, the
Option was extended until April 22, 1996 and the Exercise Price of the Option
was changed to $.5625 per share in cash. In addition, certain antidilution
provisions were added to protect the holder of the Option from dilution
resulting from certain corporate transactions. The description of the
Amendment Agreement contained herein is qualified in its entirety by reference
to the Amendment Agreement, a copy of which is attached as Exhibit 11, which is
incorporated herein by reference.
On August 9, 1995, Loewen Group International, Inc., a Delaware corporation
("Loewen") and MH Associates entered into a Warrant Option Agreement (the
"Warrant Option
Page 12 of 29
<PAGE>
Agreement"), pursuant to which MH Associates agreed to grant Loewen an option,
exercisable under certain circumstances, to purchase MH Associates' option to
purchase shares of the Company (the "Warrant") as provided in a Stock Option
Agreement, dated as of April 22, 1986, as amended (the "Option Agreement"),
between MH Associates and the Company. Loewen may exercise its rights under the
Warrant Option Agreement at any time after the expiration or termination of its
tender offer (the "Offer") made pursuant to an Agreement and Plan of Merger,
dated August 9, 1995 (the "Merger Agreement"), among the Company, Loewen and a
subsidiary of Loewen, and until to October 31, 1995 (or 60 days after such date
if Loewen exercises its right to extend the exercisability of its rights under
the Warrant Option Agreement and makes the payment (the "Extended Option
Payment") to MH Associates provided in such agreement). Loewen's right to
purchase the Warrant under the Warrant Option Agreement shall terminate if the
Offer is not commenced by August 15, 1995. Pursuant to the Warrant Option
Agreement, Loewen must purchase the Warrant from MH Associates if any shares are
accepted for payment under the Offer.
The purchase price for the Warrant shall be equal to (i) 486,352 times the
-
greater of the per share price offered or to be offered for Common Stock in the
Offer (as such amount may be increased in the Offer) and the highest
Page 13 of 29
<PAGE>
price per share of Common Stock paid at any time by Loewen (or any of its
affiliates) in any transaction other than the Offer, in each case as of the date
of exercise, subject to the following sentence, minus (ii) the sum of the
--
aggregate exercise price of the Warrant and the amount of the Extended Option
Payment, if any. If, within one year following the exercise of the option
provided in the Warrant Option Agreement, the per share prices described in
clause (i) are increased, within five business days thereafter Loewen shall pay
-
to MH Associates an amount equal to the difference between the amount or amounts
previously paid to MH Associates and the Option Purchase Price as recomputed
based upon such increased price or prices. In addition, MH Associates shall be
entitled to 50% of the "Profits" (as defined in the Warrant Option Agreement)
realized by Loewen in any sale of the Warrant or the shares of Common Stock
issuable upon exercise of the Warrant.
Item 5. Interest in Securities of the Issuer.
------------------------------------
The Option initially covered 1,900,000 shares of Common Stock, representing
approximately 28.5% of the shares the Company believed to be outstanding as of
June 6, 1986. MH Associates may be deemed to be the beneficial owner of such
shares for purposes of Section 13(d) of the Securities Exchange Act of 1934.
The Option was immediately exercis-
Page 14 of 29
<PAGE>
able for 1,234,832 shares, representing 18.5% of the shares believed to be
outstanding as of June 6, 1986, and was exercisable for the remaining shares
after the approval of the Company's stockholders.
MH Associates at present has no voting rights with respect to the shares
underlying the Option. MH Associates will have sole voting and disposition
power with respect to any shares acquired through the exercise of the Option.
Except as set forth in this Schedule 13D and in the Schedule 13D of KD
Equities filed on May 5, 1986, neither MH Associates nor (to be the best of MH
Associates' knowledge) any partner of MH Associates beneficially owns any Common
Stock or has effected any transaction in the Common Stock during the sixty days
prior to the initial filing of this Schedule 13D.
The initial issuance of the Series D Preferred Stock and the Subordinated
Notes were convertible into an aggregate of 1,900,000 shares of Common Stock,
and, following a Mandatory Prepayment described in the Note and Stock Purchase
Agreement, dated August 31, 1987, between MH Associates and the Company (the
"Purchase Agreement"), the remaining outstanding Subordinated Notes and shares
of Series D Preferred Stock were convertible into 1,900,000 shares of Common
Stock, notwithstanding the Mandatory Prepayment. The following description of
the Purchase Agree-
Page 15 of 29
<PAGE>
ment is qualified in its entirety by reference to the Purchase Agreement, a
copy of which is attached as Exhibit 5, which is incorporated herein by
reference. Each share of Series D Preferred Stock was initially convertible into
70 shares of Common Stock, and each $1,000 principal amount of Subordinated
Notes was initially convertible into 712.5 shares of Common Stock. Promptly
following the Mandatory Prepayment, the Company would adjust the number of
shares of Common Stock into which each $1,000 principal face amount of
Subordinated Notes and shares of Series D Preferred Stock shall be convertible,
such that the aggregate number of shares of Common Stock into which the
Subordinated Notes and Series D Preferred Stock are convertible would remain
equal to 1,900,000. MH Associates may have been deemed to be the beneficial
owner of such underlying shares for purposes of Section 13(d) of the Securities
Exchange Act of 1934.
In addition to the 1,900,000 shares referred to above, MH Associates had
the right to acquire 1,900,000 shares of Common Stock pursuant to the Option.
(Due to adjustments pursuant to the Option, the Option is now exercisable for
486,352 shares of Common Stock.) Accordingly, MH Associates may have been deemed
to be the beneficial owner of 3,800,000 shares of Common Stock, or 28.2% of the
total of (a) the 9,685,016 shares outstanding
Page 16 of 29
<PAGE>
as of September 9, 1987 (based on information furnished to MH Associates by the
Company) and (b) such 3,800,000 shares.
Pursuant to the terms of the Preferred Stock and the 4% Notes, MH
Associates had the right to convert such securities into 1,900,000 shares of
Common Stock. On October 26, 1990, pursuant to the Note Agreement, MH
Associates exchanged all of the Preferred Stock and 4% Notes for the New Notes.
As a result, MH Associates may be deemed to be the beneficial owner of only the
shares of Common Stock subject to the Option, as amended by the Amendment Agree-
ment.
Item 6. Contracts, Arrangements, Under-
-------------------------------
standings or Relationships with
-------------------------------
Respect to Securities of the Issuer.
-----------------------------------
On April 24, 1986, KD Equities and the Company entered into the Engagement
Letter and, pursuant thereto, a Stock Option Agreement, dated as of April 22,
1986 (the "Stock Option Agreement"), copies of which are attached hereto as
Exhibits 1 and 3, respectively, and which are incorporated herein by reference.
As stated above in response to Item 4, the Engagement Letter provided for the
retention of KD Equities to advise the Company in connection with the
Acquisition, the election of two persons selected by KD Equities to the
Company's Board of Directors, the grant of the Option to KD Equities and, if the
Acquisition
Page 17 of 29
<PAGE>
is consummated, the issuance to KD Equities or its affiliate, subject to the
approval of the Company's stockholders, of an additional 15% of the Common
Stock, on a fully diluted basis.
The Engagement Letter further provided that the Company will reimburse KD
Equities for certain expenses, and indemnify KD Equities against certain
liabilities, in connection with KD Equities' services under the Engagement
Letter.
On June 6, 1986, KD Equities and the Company entered into an amendment of
the Engagement Letter, attached hereto as Exhibit 2, providing that KD Equities
will advance fees and deposits of up to $350,000 payable prior to the Closing of
the proposed Acquisition, subject to reimbursement by the Company with interest
at the prime rate only upon consummation of the Acquisition or at such other
time as the Board of Directors deems the Company's cash position adequate to
make such payments, after funding of outstanding claims in normal operating
expenses.
The Company entered into a letter agreement (the "DBL Letter"), dated May
30, 1986, with the investment banking firm of Drexel Burnham Lambert
Incorporated ("DBL"), pursuant to which DBL had agreed to render advice
regarding the structure of the proposed Acquisition and to assist the Company in
obtaining financing for the Acquisition. On
Page 18 of 29
<PAGE>
June 3, 1986, DBL delivered to the Company and KD Equities a letter to the
effect that it is highly confident of its ability to raise the proposed
financing through the sale of subordinated debt securities of the Company,
subject to the conditions thereof. In addition to certain fees payable in cash,
upon consummation of the Acquisition (provided that DBL has obtained the
financing commitments from third parties described in the DBL Letter), DBL and
its institutional investors would receive the right to purchase, on terms
consistent with the preservation of the Company's net operating loss carry-
forward to be agreed by DBL and the Company, up to 15% of the fully-diluted
common equity of the Company prior to such purchase based upon the closing
market price of the Common Stock on the New York Stock Exchange on May 30, 1986.
KD Equities guaranteed the obligations of the Company under the DBL Letter.
The Stock Option Agreement initially granted to KD Equities a five-year
option to purchase up to 1,900,000 shares of the Common Stock at $1.46 per
share, which was the average closing price of the Common Stock for the 30-day
period ended on April 17, 1986. The Option was immediately exercisable for
1,234,832 shares of the Common Stock, and became exercisable for the remaining
shares upon the approval of the Company's stockholders. Pursuant to the Letter
Agreement between KD Equities and MH Associates, the
Page 19 of 29
<PAGE>
Stock Option Agreement was assigned by KD Equities to MH Associates.
The initial purchase price of the Option was $.25 per share, which was not
credited against the Option's exercise price. Pursuant to the Letter
Agreement, MH Associates paid $308,708 to KD Equities. The remainder of the
Option purchase price was paid by MH Associates to the Company when approval by
the Company's stockholders was obtained.
On August 31, 1987, MH Associates and the Company entered into a letter
agreement, dated as of August 31, 1987 (the "1987 Letter Agreement"). The
following description of the 1987 Letter Agreement is qualified in its entirety
by reference to the 1987 Letter Agreement, which is attached as Exhibit 6, which
is incorporated herein by reference. The 1987 Letter Agreement provided that on
November 1, 1987, the Company would exchange the outstanding Subordinated Notes
and Series D Preferred Stock for new or amended subordinated notes and preferred
stock (the "New Securities") of identical aggregate principal amount and
liquidation value (the "Aggregate Value") and blended average rate of return,
and having the same terms and conditions as the Subordinated Notes and Preferred
Stock, provided that the aggregate liquidation value of such new preferred stock
--------
would be no more than $1,000,000 and the aggregate principal amount of such new
subordinated notes would be no less than the
Page 20 of 29
<PAGE>
Aggregate Value less $1,000,000, the interest rate applicable to such new
subordinated notes will be the rate yielding a 4% blended average rate of return
on the Aggregate Value assuming a dividend rate of $4 per $100 of liquidation
value with respect to such new preferred stock and the New Securities would be
otherwise subject to and in full compliance with the terms and conditions of the
Revolving Credit Agreement dated as of August 28, 1987, as amended, between the
Company and the First National Bank of Boston. The New Securities were
convertible into 1,900,000 shares of Common Stock.
The 1987 Letter Agreement further provided that the Company will nominate
and recommend for election to its Board of Directors by stockholders and by
appointment pending the next special meeting of the Company's stockholders two
persons (or if the size of the Board of Directors shall be increased to 6, 7 or
8 members, not including such holders' nominees, three persons) nominated for
election or appointment by the holders of a majority in Aggregate Value of the
Subordinated Notes and Series D Preferred Stock or the New Securities, as the
case may be.
MH Associates at present has no voting rights with respect to any shares of
Common Stock. MH Associates will have sole voting and dispositive power with
respect to any shares of Common Stock acquired through the exercise of the
Page 21 of 29
<PAGE>
Option or convertible pursuant to such Purchase Agreement, subject to the
Warrant Option Agreement.
MH Associates had voting rights with respect to the shares of Series D
Preferred Stock. Whenever accrued dividends payable on the shares of Series D
Preferred Stock are in default in an aggregate amount equal to two full
quarterly dividends, the number of directors constituting the Board of Directors
of the Company will be increased by two, and the holders of Series D Preferred
Stock, voting as a class, will have the right to elect two directors of the
Company to fill such newly created directorships. The right of the holders of
Series D Preferred Stock to vote for the election of such members of the Board
of Directors will continue until such time as all dividends accrued and unpaid
on Series D Preferred Stock is paid or declared and a sum sufficient for the
payment therefor set apart, at which time the right so to vote separately as a
class for the election of directors will terminate.
Pursuant to the 1987 Letter Agreement, if prior to November 1, 1987, the
Company presents to MH Associates a purchaser of the Subordinated Notes, Series
D Preferred Stock for their Aggregate Value, plus accrued but unpaid interest
and dividends, and the Option, then MH Associates will (unless MH Associates
sells such securities to an unaffiliated third party at a higher price), sell
all of the
Page 22 of 29
<PAGE>
Subordinated Notes, Series D Preferred Stock and the Option to such purchaser.
On February 19, 1988, MH Associates and the Company entered into a letter
agreement, pursuant to which the Company issued $900,000 principal amount of its
Subordinated Notes in exchange for 9,000 shares of Series D Preferred Stock
held by MH Associates. The exchange was made pursuant to the 1987 Letter
Agreement entered into at the time of the initial issuance of such securities
and did not affect the aggregate amount of Common Stock into which such
securities were convertible. The terms of such securities were amended so that
they continued to be convertible, in the aggregate, into 1,900,000 shares of
Common Stock. As a result of the exchange, MH Associates held $1,100,000
principal amount of the Subordinated Notes which were convertible into 1,000,000
shares of Common Stock and 10,000 shares of Series D Preferred Stock which were
con vertible into 900,000 shares of Common Stock.
MH Associates acquired the Option, Subordinated Notes and Series D
Preferred Stock (collectively, the "Securities") of the Company as an
investment. As of May 19, 1988, MH Associates was investigating the possibility
of selling the Securities and will take such action as may be in its best
interests to maximize the value of such investment. Without limiting the
generality of the foregoing, MH
Page 23 of 29
<PAGE>
Associates planned to seek offers to purchase the Securities as a block in a
private sale. Any such sale of the Securities is subject to a right of first
refusal in favor of the Company under a letter agreement, a copy of which is
filed as Exhibit 8 and is incorporated herein by reference. MH Associates did
not intend to sell the Securities unless the purchase also offers to purchase
240,000 shares of Common Stock of the Company privately placed by the Company in
March of 1987.
On October 26, 1990, the Company and MH Associates executed the Note
Agreement, the New Notes and the Amendment Agreement each described more fully
in Item 4, above.
On October 9, 1992, the Company and MH Associates executed an amendment
(the "Amendment") to the Note Agreement. The Amendment provides that Heller
Financial, Inc. will replace The First National Bank of Boston as the provider
of Senior Indebtedness (as defined in the Note Agreement) to the Company. The
description of the Amendment contained herein is qualified in its entirety by
reference to the Amendment, a copy of which is attached as Exhibit 12, which is
incorporated herein by reference.
On August 9, 1995, Loewen and MH Associates executed the Warrant Option
Agreement described more fully in Item 4, above.
Page 24 of 29
<PAGE>
Item 7. Material to be Filed as Exhibits.
--------------------------------
Exhibit 1 - Engagement Letter, dated as of April 22, 1986, between Mobile Home
Industries, Inc. and KD Equities.
Exhibit 2 - Amendment to Engagement Letter, dated as of June 6, 1986, between
Mobile Home Industries, Inc. and KD Equities.
Exhibit 3 - Stock Option Agreement, dated as of April 22, 1986 between Mobile
Home Industries, Inc. and KD Equities.
Exhibit 4 - Letter Agreement, dated as of June 6, 1986, between KD Equities
and MH Associates.
Exhibit 5 - Note and Stock Purchase Agreement, dated as of August 31, 1987,
between MH Associates and the Company.
Exhibit 6 - Letter Agreement, dated as of August 31, 1987, between MH
Associates and the Company.
Exhibit 7 - Letter Agreement, dated February 19, 1988, between MH Associates
and the Company.
Exhibit 8 - Letter Agreement, dated August 3, 1988, among MH Associates, KD
Associates and the Company.
Exhibit 9 - Letter, dated November 7, 1988, from MH Associates to the Company.
Exhibit 10 - Securities Exchange and Note Agreement, dated October 26, 1990,
between the Company and MH Associates.
Exhibit 11 - Option Amendment Agreement, dated October 26, 1990, between the
Company and MH Associates.
Exhibit 12 - Amendment, dated October 9, 1992, to the Securities Exchange and
Note Agreement, dated October 26, 1990, between the Company and MH
Associates.
Page 25 of 29
<PAGE>
Exhibit 13 Warrant Option Agreement, dated as of August 9, 1995, between
Loewen Group International, Inc. and MH Associates.
Page 26 of 29
<PAGE>
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
Dated: August 11, 1995
MH Associates
By: /s/George A. Kellner
----------------------
A General Partner
Page 27 of 29
<PAGE>
Annex 1
GENERAL PARTNERS OF MH ASSOCIATES
The names of each of the general partners of MH Associates, as of June 16,
1986, are set forth below. The then present principal occupation of each such
person, other than Mr. Critchell, Mr. Dinan, Ms. Broms and Ms. Rosen were as a
general partner of Kellner, DiLeo. Mr. Critchell's then present principal
occupation was as general partner of KD Equities. Mr. Dinan, Ms. Broms and Ms.
Rosen were employees of Kellner, DiLeo. Messrs. Kellner and DiLeo are managing
partners of Kellner, DiLeo. Each such person, other than Mr. Dinan, Ms. Broms
and Ms. Rosen, as of June 16, 1986, was also a general partner of KD Equities.
The business address of each such person is 900 Third Avenue, New York, New York
10022.
Name
----
Roger E. Alcaly
Walter J. Aspenleiter
Robert H. Barnes
Liina Broms
Robert S. Critchell
Philip F. DiLeo
James G. Dinan
Jane W. Dresner
Angelo Godio
Michael S. Gudyka
George A. Kellner
Barry P. Newburger
John S. Noonan
Theordore Pugliese
Allison Rosen
Page 28 of 29
<PAGE>
Eugene Santoro
Walter D. Serafin
Jeffrey E. Schwarz
Lawrence J. Sconzo, Jr.
Page 29 of 29
<PAGE>
EXHIBIT 13
WARRANT OPTION AGREEMENT
WARRANT OPTION AGREEMENT, dated as of August 9, 1995 (the
"Agreement"), among LOEWEN GROUP INTERNATIONAL, INC., a Delaware corporation
(the "Parent"), and MH ASSOCIATES, a New York general partnership (the
"Investor").
WHEREAS, the Parent, SPRT Corp., a Florida corporation and a wholly
owned subsidiary of the Parent (the "Purchaser"), and MHI Group, Inc., a Florida
corporation (the "Company"), propose to enter into an Agreement and Plan of
Merger of even date herewith (the "Merger Agreement") providing for the making
of a cash tender offer (the "Offer") by the Parent and the Purchaser for shares
of Common Stock, par value $.40 per share, of the Company (the "Common Stock")
and the merger of the Company and the Purchaser (the "Merger"); and
WHEREAS, the Investor is a party to the option agreement dated April
22, 1986, as amended (the "KD Warrant") to purchase 486,352 shares of Common
Stock (the "Optioned Shares");
NOW, THEREFORE, in consideration of the promises and the
representations, warranties and agreements herein contained, the parties agree
as follows:
1. Grant of Options.
----------------
(a) Initial Option. The Investor grants to the Parent an irrevocable
--------------
option (the "Initial Option"), exercisable, as provided in Sections 2 and 3
(subject to Section 1 (d)), at any time after the expiration or termination of
the offer or the acceptance for purchase by the Purchaser (or any other person
who is authorized by the Parent) of any shares of Common Stock pursuant to the
Offer, until October 31, 1995 (the "Initial Option Period"), to purchase the KD
Warrant for the Option Purchase Price (as defined in Section l(c) hereof).
(b) Extended Option. If, prior to the last day of the Initial Option
---------------
Period, the Parent notifies the Investor of its intent to extend the exercise
period of the option described in this Section l(b) and pays the Investor
$607,940 in cash (the "Extended Option Payment") by wire transfer of immediately
available funds to an account designated by the Investor within two business
days after
<PAGE>
delivery of such notice) the Investor shall grant to the Parent an irrevocable
option (the "Extended Option," and together with the Initial Option, the
"Options"), exercisable, as provided in Sections 2 and 3 (subject to Section
l(d)), at any time during the 60-day period commencing on the first day
following the Initial Option Period (the "Extended Option Period"), to purchase
the KD Warrant for the Option Purchase Price.
(c) Option Purchase Price. Except as provided in the last sentence of
---------------------
this Section l(c), the Option Purchase Price shall be payable in cash by wire
transfer of immediately available funds to an account designated by the Investor
at least one business day prior to payment, and shall be an amount equal to (i)
-
486,352 times the greater of the per share price offered or to be offered for
Common Stock by the Parent or the Purchaser in the Offer (as such amount may be
increased in the Offer) and the highest price per share of Common Stock paid at
any time by the Parent or the Purchaser (or any of its affiliates) in any
transaction other than the offer (including, but not limited to, open market
purchases or consideration paid pursuant to a merger or similar transaction, but
not including any amounts paid in respect of appraisal proceedings under Florida
law), in each case as of the date of exercise, subject to the following sentence
minus (ii) the sum of the aggregate exercise price of the KD Warrant and the
--
amount of the Extended Option Payment paid by the Parent. If, within one year
following the exercise of any of the Options, the per share prices described in
clause (i) are increased, within five business days thereafter the Parent shall
pay to the Investor an amount in cash, by wire transfer of immediately available
funds to an account designated by the Investor equal to the difference between
the amount or amounts previously paid to the Investor and the Option Purchase
Price as recomputed based upon such increased price or prices. In the event
that noncash consideration is included in the Option Purchase Price, the Option
Purchase Price shall be payable in both such noncash consideration and cash in
the respective percentages thereof paid by the Parent or the Purchaser for
shares of Common Stock.
(d) Limits on Exercise. Notwithstanding the provisions of Sections 1
------------------
and 2 of this Agreement, the Options shall not be exercisable, shall expire and
shall be null and void after August 15, 1995 if the Offer is not commenced on or
prior to August 15, 1995.
2
<PAGE>
2. Exercise of Options.
-------------------
(a) Elective Exercise. If the Parent wishes to exercise either of the
-----------------
Options, the Parent shall do so by delivering written notice during the Initial
Option Period or the Extended Option Period, as the case may be (the date of
such notice being herein called the "Notice Date"), to the Investor specifying
the place, time and date not earlier than two business days, nor later than ten
business days, from the Notice Date for the closing of the purchase by the
Parent pursuant to such exercise. The delivery of such notice shall be deemed
for all purposes to be the exercise of the Options and shall constitute an
irrevocable and binding commitment on the part of the Parent to purchase the KD
Warrant upon the terms set forth in this Agreement.
(b) Mandatory Exercise. If any share of Common Stock is accepted for
------------------
payment by the Parent or the Purchaser (or any other person who is authorized by
the Parent) pursuant to the Offer, the Parent shall without the requirement of
any notice or other action by the Parent or the Investor, be deemed to have
exercised the Options on the business day immediately following such date and
shall pay the Option Purchase Price at a closing no later than three business
days following the date of such acceptance for payment. Such acceptance for
payment pursuant to the Offer shall constitute an irrevocable and binding
commitment on the part of the Parent to purchase the KD Warrant upon the terms
set forth in this Agreement.
3. Payment of Option Purchase Price and Delivery of Assignment of the
------------------------------------------------------------------
KD Option. At any closing of the exercise of the Options hereunder, (a) the
--------- -
Parent shall deliver to the Investor the Option Purchase Price and (b) the
Investor shall deliver to the Parent an instrument of assignment of the KD
Option in form and substance reasonably satisfactory to the Parent.
4. Sale or Transfer of the KD Warrant by the Parent. If, prior to the
------------------------------------------------
first anniversary of the date of the exercise of either of the Options, the
Parent or any of its affiliates sells or otherwise transfers (including but not
limited to, by merger of the Company) or assigns either the KD Warrant, in whole
or in part, or any shares of Common Stock acquired upon exercise thereof, it
will promptly pay over to the Investor 50% of the Profits (defined below)
realized therefrom. "Profits" shall mean, (a) in the case of shares of Common
-
Stock, (i) the excess of (A) the price per share received by the Parent over (B)
- - -
the sum of the
3
<PAGE>
Option Purchase Price, the aggregate exercise price of the KD Warrant and the
amount of any Extended Option Payment paid by the Parent, divided by 486,352,
multiplied by (ii) the number of shares in question, and (b) in the case of the
-- -
KD Warrant, the excess of (A) the consideration received by the Parent over (B)
- -
the sum of the Option Purchase Price and the amount of any Extended Option
Payment paid by the Parent (or the appropriate pro rata portion thereof, in the
case of partial sales). In the event that noncash consideration is included in
consideration received by the Parent, the Profits shall be payable in such
noncash consideration in the same percentage as such noncash consideration bears
to the total consideration received by the Parent.
5. Representations and Warranties of the Investor. The Investor hereby
----------------------------------------------
represents and warrants to the Parent as follows:
(a) Authority; Noncontravention. The Investor has all requisite power and
---------------------------
authority to enter into this Agreement and to consummate the transactions
contemplated hereby. The execution and delivery of this Agreement by the
Investor and the consummation by the Investor of the transactions contemplated
hereby have been duly authorized by all necessary partnership action on the part
of the Investor. This Agreement has been duly executed and delivered by the
Investor and constitutes a valid and binding obligation of the Investor,
enforceable against the Investor in accordance with its terms. The execution
and delivery of this Agreement do not, and the consummation of the transactions
contemplated hereby and compliance with the terms hereof will not, conflict
with, or result in any violation of, or default (with or without notice or lapse
of time or both) under (i) organizational documents of the Investor or (ii) any
- --
provision of any trust agreement, loan or credit agreement, note, bond,
mortgage, indenture, lease or other agreement, instrument, permit, concession,
franchise, license, judgment, order, decree, statute, law, ordinance, rule or
regulation applicable to the Investor or to the Investor's property or assets,
other than, in the case of clause (ii), any such conflicts, violations,
defaults, rights or liens that individually or in the aggregate would not
prevent the consummation of any of the transactions contemplated by this
Agreement. No consent, approval, order or authorization of, or registration,
declaration or filing with, any federal,
4
<PAGE>
state or local government or any court, administrative or regulatory agency or
commission or other governmental authority or agency, domestic or foreign (a
"Governmental Entity"), is required by or with respect to the Investor in
connection with the execution and delivery of this Agreement or the consummation
by the Investor of the transactions contemplated by this Agreement, except for
(1) the filing with the Securities and Exchange Commission of such reports under
--
Sections 13(d) and 16(a) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act") as may be required in connection with this Agreement and the
transactions contemplated by this Agreement and (2) such other consents,
-
approvals, orders, authorizations, registrations, declarations and filings as
would not individually or in the aggregate prevent the consummation of any of
the transactions contemplated by this Agreement.
(b) The KD Warrant. The KD Warrant is in full force and effect, has not
--------------
heretofore been exercised in whole or in part, and is assignable by the Investor
free and clear of any claims, liens, encumbrances or security interests.
6. Representations and Warranties of the Parent. The Parent hereby
--------------------------------------------
represents and warrants to the Investor as follows:
(a) Authority: Noncontravention. The Parent has all requisite corporate
---------------------------
power and authority to enter into this Agreement and to consummate the
transactions contemplated by this Agreement. The execution and delivery of this
Agreement and the consummation of the transactions contemplated by this
Agreement have been duly authorized by all necessary corporate action on the
part of the Parent. This Agreement has been duly executed and delivered by the
Parent and constitutes a valid and binding obligation of the Parent, enforceable
against the Parent in accordance with its terms. The execution and delivery of
this Agreement do not, and the consummation of the transactions contemplated by
this Agreement and compliance with the provisions of this Agreement will not,
conflict with, or result in any violation of, or default (with or without notice
or lapse of time, or both) under, (i) the certificate of incorporation or by-
-
laws of the Parent or the comparable charter or organizational documents of any
other subsidiary of the Parent, (ii) any loan or credit
--
5
<PAGE>
agreement, note, bond, mortgage, indenture, lease or other agreement,
instrument, permit, concession, franchise or license applicable to the Parent or
any of its subsidiaries or their respective properties or assets or (iii)
---
subject to the governmental filings and other matters referred to in the
following sentence, any judgment, order, decree, statute, law, ordinance, rule
or regulation applicable to the Parent or any of its subsidiaries or their
respective properties or assets, other than, in the case of clause (ii) or
(iii), any such conflicts, violations, defaults, rights or liens that
individually or in the aggregate would not (x) have a material adverse effect
-
(as such term is defined in the Merger Agreement) on the Parent, (y) impair the
-
ability of the Parent to perform its respective obligations under this Agreement
or (z) prevent the consummation of any of the transactions contemplated by this
-
Agreement. No consent, approval, order or authorization of, or registration,
declaration or filing with, any Governmental Entity is required by or with
respect to the Parent or any of its subsidiaries in connection with the
execution and delivery of this Agreement or the consummation by the Parent of
any of the transactions contemplated by this Agreement, except for (1) the
-
filing with the Securities and Exchange Commission of such reports under
Sections 13(a), 13(d), 14(d) and 16(a) of the Exchange Act as may be required in
connection with this Agreement and the transactions contemplated by this
Agreement, (2) filings and reports under the Hart-Scott-Rodino Antitrust
-
Improvements Act of 1976, as amended, in connection with the Offer, and (3) such
-
other consents, approvals, orders, authorizations, registrations, declarations
and filings as would not individually or in the aggregate (A) have a material
-
adverse effect on the Parent or (B) prevent the consummation of any of the
-
transactions contemplated by this Agreement.
(b) Securities Act. The KD Warrant and any shares of Common Stock acquired
--------------
upon exercise thereof will be acquired for investment only and not with a view
to any public distribution thereof, and the Parent will not offer to sell or
otherwise dispose of the KD Warrant or any shares so acquired by it in violation
of any of the registration requirements of the Securities Act of 1933, as
amended.
6
<PAGE>
7. Covenants of the Investor. The Investor agrees, until the Options
-------------------------
have expired, not to exercise the KD warrant in whole or in part or to sell,
transfer, pledge, assign or otherwise dispose of, or enter into any contract,
option or other arrangement with respect to the sale, transfer, pledge,
assignment or other disposition of, the KD Warrant to any person other than
pursuant to this Agreement.
8. No Brokers. Except for Smith Barney Inc. and Mr. Peter Gruenbaum
----------
(the financial advisors retained by the Parent), each of the Investor and the
Parent represents, as to itself and its affiliates, that no agent, broker,
investment banker or other firm or person is or will be entitled to any broker's
or finder's fees or any other commission or similar fee in connection with any
transaction undertaken pursuant to this Agreement and respectively agrees to
indemnify and hold the others harmless from and against any and all claims,
liabilities or obligations with respect to any such fees, commissions or
expenses asserted by any person on the basis of any act or statement alleged to
have occurred or been made by such party or its affiliates.
9. Survival of Representations. All representations, warranties and
---------------------------
agreements made by the parties to this Agreement shall not survive beyond the
first anniversary of the date of the exercise of any of the options, except that
the representations of the Investor with respect to the Parent's title to the KD
Warrant shall survive indefinitely.
10. Further Assurances. If the Parent shall exercise either of the
------------------
Options in accordance with the terms of this Agreement, from time to time and
without additional consideration the Investor will execute and deliver, or cause
to be executed and delivered, such additional or further transfers, assignments,
endorsements, consents and other instruments as the Parent may reasonably
request for the purpose of effectively carrying out the transactions
contemplated by this Agreement, including the transfer of the KD Warrant to the
Parent and the release of any and all liens, claims and encumbrances with
respect thereto.
11. Assignment. Neither this Agreement nor any of the rights,
----------
interests or obligations hereunder shall be assigned by any of the parties
without the prior written consent of the other party, except that the Parent may
assign, in its sole discretion, any or all of its rights, interests and
obligations hereunder to any direct or
7
<PAGE>
indirect wholly owned subsidiary of the Parent in which case such subsidiary and
the Parent shall remain jointly and severally liable for all of the Parent's
obligations hereunder. Subject to the preceding sentence, this Agreement will
be binding upon, inure to the benefit of and be enforceable by the parties and
their respective successors and assigns.
12. General Provisions.
------------------
(a) Expenses. Whether or not the Option is exercised, all costs and
--------
expenses incurred in connection with the Option, this Agreement and the
transactions contemplated hereby shall be paid by the party incurring such
expense.
(b) Amendments. This Agreement may not be amended except by an
----------
instrument in writing signed by each of the parties hereto.
(c) Notices. All notices and other communications hereunder shall be
-------
in writing and shall be deemed delivered if delivered personally or sent by
overnight courier (providing proof of delivery) or by electronically confirmed
facsimile to the parties at the following addresses (or at such other address
for a party as shall be specified by like notice):
(i) if to the Parent, to
Loewen Group International, Inc.
50 East RiverCenter Boulevard
Suite #800
Covington, Kentucky 41011
Facsimile: (606) 655-7144
Attention: Robert Wienke, Esq.
with a copy to:
Jones, Day, Reavis & Pogue
599 Lexington Avenue
New York, New York 10022
Facsimile: (212) 755-7306
Attention: Christopher Kelly, Esq., and
(ii) if to the Investor, to
George Kellner
Kellner Dileo & Co.
8
<PAGE>
900 Third Avenue, l0th Floor
New York, New York 10022
Facsimile: (212) 350-0340
with a copy to:
Debevoise & Plimpton
875 Third Avenue
New York, New York 10022
Facsimile: (212) 909-6836
Attention: Meredith M. Brown, Esq.
(d) Enforcement of the Agreement. The parties hereto agree that
----------------------------
irreparable damage would occur in the event that any of the provisions of this
Agreement were not performed in accordance with their specific terms or were
otherwise breached. It is accordingly agreed that, in the event of a breach
hereof, the parties hereto will be entitled to and injunction or injunctions to
prevent breaches of this Agreement and to enforce specifically the terms and
provisions hereof in any court of the United States or any state having
jurisdiction, this being in addition to any other remedy to which they are
entitled at law or in equity.
(e) Interpretation. When a reference is made in this Agreement to
--------------
Sections or Exhibits, such reference shall be to a Section or Exhibit to this
Agreement unless otherwise indicated. The headings contained in this Agreement
are for reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement. Wherever the words "include", "includes" or
"including" are used in this Agreement, they shall be deemed to be followed by
the words "without limitation".
(f) Counterparts. This Agreement may be executed in one or more
------------
counterparts, all of which shall be considered one and the same agreement.
(g) Entire Agreement: No Third Party Beneficiaries. This Agreement
----------------------------------------------
(including the documents and instruments referred to herein) (i) constitutes the
-
entire agreement and supersedes all prior agreements and understandings, both
written and oral, among the parties with respect to the subject matter hereof
and (ii) is not intended to confer upon any person other than the parties hereto
--
any rights or remedies hereunder.
9
<PAGE>
(h) Governing Law. This Agreement shall be governed by and construed
-------------
in accordance with the laws of the State of New York.
IN WITNESS WHEREOF, the Parent and the Investor have caused this
Agreement to be signed by their respective duly authorized representatives, all
as of the date first written above.
LOEWEN GROUP INTERNATIONAL, INC.
By: /s/A.M. Bruce Watson
-----------------------------
Name: A.M. Bruce Watson
Title: Treasurer
MH ASSOCIATES
By: /s/George A. Kellner
-----------------------------
Name: George A. Kellner
Title: General Partner
10
