<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
(Rule 13d-101)
INFORMATION TO BE INCLUDED IN STATEMENTS FILED PURSUANT TO RULE 13d-1(a)
AND AMENDMENTS THERETO FILED PURSUANT TO RULE 13d-2(a)
(Amendment No. 5 )1
The Loewen Group Inc.
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(Name of Issuer)
Common shares without par value
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(Title of Class of Securities)
54042L 10 0
----------------------------------------
(CUSIP Number)
Tina Swinton
Loewen Capital Corporation
4126 Norland Avenue, Burnaby, British Columbia Canada V5G 3S8
(604) 293-9231
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(Name, Address and Telephone Number of Person Authorized to Receive
Notices and Communications)
November 2, 1998
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(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(e), 13d-1(f) or 13d-1(g), check
the following box / /.
NOTE: Schedules filed in paper format shall include a signed original and
five copies of the schedule, including all exhibits. See Rule 13d-7(b) for
other parties to whom copies are to be sent.
(Continued on following pages)
- ---------- 1 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 ("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 1 of 9 Pages
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SCHEDULE 13D
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CUSIP No. 54042 L 10 0 Page 2 of 9 Pages
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<S><C>
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1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
3546373 Canada Inc. (formerly known as Loewen Financial Inc.)
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) / /
(b) / /
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3 SEC USE ONLY
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4 SOURCE OF FUNDS*
N/A
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) OR 2(e) / /
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
Canada
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7 SOLE VOTING POWER
0
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NUMBER OF 8 SHARED VOTING POWER
SHARES
BENEFICIALLY 0
OWNED BY --------------------------------------------------------------
EACH 9 SOLE DISPOSITIVE POWER
REPORTING
PERSON 0
WITH --------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
0
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
0
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12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES *
/ /
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
0
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14 TYPE OF REPORTING PERSON *
CO
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</TABLE>
*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
<PAGE>
SCHEDULE 13D
<TABLE>
<CAPTION>
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CUSIP No. 54042 L 10 0 Page 3 of 9 Pages
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<S><C>
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1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Raymond L. Loewen
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) / /
(b) / /
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3 SEC USE ONLY
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4 SOURCE OF FUNDS*
PF
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) OR 2(e) / /
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
Canada
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7 SOLE VOTING POWER
1,477,664
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NUMBER OF 8 SHARED VOTING POWER
SHARES
BENEFICIALLY 0
OWNED BY --------------------------------------------------------------
EACH 9 SOLE DISPOSITIVE POWER
REPORTING
PERSON 1,477,664
WITH --------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
0
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
1,477,664
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12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES *
/ X /
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
2.0
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14 TYPE OF REPORTING PERSON *
IN
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</TABLE>
*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
<PAGE>
SCHEDULE 13D
<TABLE>
<CAPTION>
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CUSIP No. 54042 L 10 0 Page 4 of 9 Pages
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<S><C>
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1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Anne Loewen
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) / /
(b) / /
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3 SEC USE ONLY
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4 SOURCE OF FUNDS*
PF
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) OR 2(e) / /
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
Canada
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7 SOLE VOTING POWER
2,254,838
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8 SHARED VOTING POWER
NUMBER OF
SHARES 0
BENEFICIALLY -------------------------------------------------------------
OWNED BY 9 SOLE DISPOSITIVE POWER
EACH
REPORTING 2,254,838
PERSON -------------------------------------------------------------
WITH 10 SHARED DISPOSITIVE POWER
0
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
2,254,838
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12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES *
/ /
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
3.0
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14 TYPE OF REPORTING PERSON *
IN
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</TABLE>
*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
<PAGE>
ITEM 1. SECURITY AND ISSUER
The class of equity securities to which this statement
("Statement") relates is the Common shares without par value ("Common Shares")
of The Loewen Group Inc., a corporation organized under the laws of British
Columbia, Canada ("TLGI"). TLGI owns and operates more than 1,100 funeral homes
and over 500 cemeteries across the United States, Canada and the United Kingdom.
The principal executive offices of TLGI are located at 4126 Norland Avenue,
Burnaby, British Columbia, Canada V5G 3S8.
ITEM 2. IDENTITY AND BACKGROUND
This Statement is filed by 3546373 Canada Inc., a corporation
organized under the Canada Business Corporations Act and formerly known as
Loewen Financial Inc., a corporation organized under the laws of British
Columbia, Canada ("LFI"), Raymond L. Loewen, an individual, and Anne Loewen, an
individual. Raymond L. Loewen and Anne Loewen are husband and wife. The
business address of LFI, Raymond L. Loewen and Anne Loewen is 4126 Norland
Avenue, Burnaby, British Columbia, Canada V5G 3S8.
Raymond L. Loewen is the sole shareholder and sole director of LFI.
The only officers of LFI are Raymond L. Loewen, president, and Tina Swinton,
secretary. On October 6, 1998, Mr. Loewen resigned as Chief Executive Officer
and President of TLGI. His current principal occupation is Co-Chairman of the
TLGI Board of Directors. The principal occupation of Tina Swinton is Vice
President, Finance of Loewen Capital Corporation, a corporation organized under
the laws of British Columbia, Canada. The principal business address of each
of TLGI and Loewen Capital Corporation is 4126 Norland Avenue, Burnaby, British
Columbia, Canada V5G 3S8. Anne Loewen is not employed.
During the last five years, none of LFI, Raymond L. Loewen, Anne
Loewen and Tina Swinton has been convicted in a criminal proceeding (excluding
traffic violations and similar misdemeanors) or has been 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 or mandating activities
subject to, federal or state securities laws or finding any violation with
respect to such laws.
Raymond L. Loewen, Anne Loewen and Tina Swinton are citizens of
Canada.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION
This Statement is being filed to report the transfer by LFI and
Raymond L. Loewen, pursuant to the Sale Agreement (as defined in Item 4 below),
of 10,062,125 Common Shares actually owned by them or by certain entities
controlled by them. See Item 4 below. Raymond L. Loewen used personal funds to
finance his purchases of the 10,743 Common Shares actually owned by him. The
remaining 1,466,921 Common Shares beneficially owned by Raymond L. Loewen are
shares which Mr. Loewen has the right to acquire within 60 days of November 2,
1998, pursuant to options granted to Mr. Loewen under TLGI's employee stock
Page 5 of 9 Pages
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option plans (the "Stock Options"). Raymond L. Loewen also holds options to
acquire an additional 240,300 Common Shares, which options will become
exercisable from time to time beginning in May 1999. Under the TLGI 1994
Management Equity Investment Plan, Raymond L. Loewen was granted certain rights,
and has certain obligations, to acquire an additional 2,000,000 Common Shares,
beginning in June 1999.
Anne Loewen used personal funds to finance her purchases of Common
Shares. Anne Loewen's most recent purchase of Common Shares was made in
February 1994.
ITEM 4. PURPOSE OF TRANSACTION
Prior to November 2, 1998, an aggregate of 10,062,125 Common Shares
beneficially owned by LFI and Raymond L. Loewen (the "Pledged Shares") were
pledged to Canadian Imperial Bank of Commerce, a Canadian chartered bank (the
"Bank"), pursuant to the Credit Agreement dated as of October 23, 1997, as
amended and restated as of August 21, 1998 and further amended as of October 23,
1998 (the "Credit Agreement"). The Pledged Shares were directly held as
follows: (i) 836,000 shares by Raymond L. Loewen; (ii) 5,107,600 shares by LFI,
(iii) 3,879,325 shares by Loewen Financial Limited Partnership, a limited
partnership existing under the laws of Alberta in which LFI owns a 99.78%
interest and is the sole general partner ("LFLP"); and (iv) 239,200 shares by
Loewen Limited Partnership, a limited partnership existing under the laws of
British Columbia in which Raymond L. Loewen owns a 99.99% interest and is the
sole general partner ("LLP" and together with LFLP and LFI, the "Loewen
Affiliates"). The Loewen Affiliates had guaranteed Raymond L. Loewen's
obligations under the Credit Agreement (the "Guarantees"). On November 2, 1998,
Raymond L. Loewen, the Loewen Affiliates and the Bank entered into an Agreement
(the "Sale Agreement"), pursuant to which the Pledged Shares were transferred to
the Bank by way of a sale. The purchase price paid or payable by the Bank for
the Pledged Shares is (a) US$91,188,008 (the "Initial Consideration"), plus
(b) any Additional Consideration (as defined in Item 6 below) that may become
payable under the Amended Credit Agreement (as defined below). A portion of the
Initial Consideration was used to repay principal, interest and other amounts
owing under the Credit Agreement, and the balance was deposited in a security
account (the "Security Account"). The Credit Agreement was amended and restated
as of November 2, 1998 (the "Amended Credit Agreement"), to fix the interest
rate at 5.27% and to change the collateral securing Raymond L. Loewen's
obligations under such agreement. Raymond L. Loewen's obligations to the Bank
under the Amended Credit Agreement are secured by amounts held in the Security
Account, Mr. Loewen's rights to receive Additional Consideration (as defined in
Item 6 below) and certain rights relating to the Stock Options. See Item 6. As
of November 2, 1998, the Loewen Affiliates were released from their obligations
and liabilities under the Guarantees.
The Bank has indicated to Raymond L. Loewen that it intends to seek
offers for the sale of the Pledged Shares; however, the Bank has agreed that,
prior to December 2, 1998, it will not sell the Pledged Shares for less than
US$16 per share, unless (a) the closing price of the Common Shares on the New
York Stock Exchange falls below $8 per share or (b) Raymond L. Loewen consents
to the sale. The Bank has engaged Raymond L. Loewen to assist and advise the
Bank in its efforts to sell the Pledged Shares. See Item 6.
Page 6 of 9 Pages
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Except as stated in this Item 4 and in Item 6, none of the
reporting persons has any plans or proposals which would result in any of the
events described in Item 4 (a) through (j).
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER
(a) After giving effect to the transfer of the Pledged Shares to
the Bank, as of November 2, 1998, Raymond L. Loewen beneficially owns
1,477,664 Common Shares, representing 2.0% of the Common Shares outstanding.
1,466,921 of such Common Shares are shares which Raymond L. Loewen has the
right to acquire within 60 days of November 2, 1998, pursuant to the Stock
Options. Anne Loewen beneficially owns 2,254,838 Common Shares, representing
3.0% of the Common Shares outstanding. Raymond L. Loewen disclaims
beneficial ownership of the Common Shares held by Anne Loewen.
(b) Raymond L. Loewen has sole voting and dispositive power with
respect to the 10,743 Common Shares he actually owns. If Raymond L. Loewen
exercises the Stock Options to acquire any of the 1,477,664 Common Shares
underlying the Stock Options, he will have sole voting and dispositive power
with respect to such shares, except that such powers may be limited by or
shared with the Bank if the shares are pledged to the Bank under the Amended
Credit Agreement. See Item 6 below. Anne Loewen has sole voting and
dispositive power with respect to the 2,254,838 Common Shares she
beneficially owns.
(c) On November 2, 1998, pursuant to the terms of the Sale
Agreement, all of the Pledged Shares were transferred to the Bank. See Items 4
and 6.
(d) None of the persons named in paragraph (a) of this Item 5 is
aware of any other person who has the right to receive or the power to direct
the receipt of dividends from, or the proceeds from the sale of, the Common
Shares currently beneficially owned by Raymond L. Loewen or Anne Loewen. If
Common Shares owned or subsequently acquired by Raymond L. Loewen are pledged
to the Bank, dividends and distributions paid in respect of such shares must
be delivered to the Bank, to be held as additional collateral for Mr.
Loewen's obligations under the Amended Credit Agreement. See Item 6 below.
(e) As of November 2, 1998, each of LFI and Raymond L. Loewen
ceased to be the beneficial owner of more than 5% of the Common Shares
outstanding. See Item 4 above.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH
RESPECT TO SECURITIES OF THE ISSUER.
Pursuant to the Sale Agreement, if the Bank sells the Pledged
Shares prior to November 1, 2000 and if the net proceeds from such sale (the
"Sale Proceeds") exceed the Initial Consideration, then a portion of such
excess proceeds based on the formula set forth in the Sale Agreement
("Additional Consideration") will be credited toward any obligations then
payable by Raymond L. Loewen under the Amended Credit Agreement ("Current
Obligations").
On November 2, 1998, Raymond L. Loewen and the Bank entered into a
letter agreement (the "Fee Agreement") pursuant to which Mr. Loewen has agreed
to advise the Bank
Page 7 of 9 Pages
<PAGE>
with respect to the potential sale of the Pledged Shares. Under the Fee
Agreement, if the Bank sells the Pledged Shares prior to March 31, 1999 and if
the Sale Proceeds exceed the sum of the Initial Consideration and the Current
Obligations, Raymond L. Loewen will be entitled to a portion of such excess
proceeds, based on the formula set forth in the Fee Agreement.
If the market value of the Common Shares exceeds the exercise price
of any of the Stock Options and if the Bank loans to Mr. Loewen sufficient funds
to pay the aggregate exercise price of such Stock Options, subject to certain
exceptions, the Bank may require Mr. Loewen to exercise such Stock Options and
acquire the underlying Common Shares. The exercise prices of the Stock Options
range from Cdn.$15.75 to Cdn.$42.25. Common Shares acquired by any exercise of
Stock Options that is required by the Bank would be pledged to the Bank to
secure Raymond L. Loewen's obligations under the Amended Credit Agreement, and
the amount advanced to Mr. Loewen to pay the exercise price would be added to
the principal amount owing under the Amended Credit Agreement.
The foregoing is qualified in its entirety by reference to the Sale
Agreement and the Fee Agreement, each of which is filed as an exhibit to this
Statement.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS
Exhibit 1: Joint Filing Agreement required by Rule 13d-1(f) under the
Securities Exchange Act of 1934, as amended*
Exhibit 2: Guarantee and Reimbursement Agreement dated June 13, 1995 between
Raymond L. Loewen and LFI*
Exhibit 3: Agreement dated as of November 2, 1998, between Raymond L. Loewen,
LFI, LFLP, LLP and the Bank
Exhibit 4: Fee Agreement dated as of November 2, 1998, between Raymond L.
Loewen and the Bank
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* Previously filed.
Page 8 of 9 Pages
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SIGNATURES
After reasonable inquiry and to the best of its knowledge and
belief, each of the undersigned certifies that the information set forth in
this statement is true, complete and correct.
Date: November 3, 1998 3546373 Canada Inc.
By: /s/ Raymond L. Loewen
-----------------------------------------
Name: Raymond L. Loewen
---------------------------------------
Title: President
--------------------------------------
/s/ Raymond L. Loewen
---------------------------------------------
Raymond L. Loewen
/s/ Anne Loewen
---------------------------------------------
Anne Loewen
Page 9 of 9 Pages
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THIS AGREEMENT made the 2nd day of November, 1998
B E T W E E N:
RAYMOND L. LOEWEN,
a businessman residing in Burnaby, British Columbia,
(hereinafter referred to as "LOEWEN"),
OF THE FIRST PART,
- and -
3546373 CANADA INC. ,
(formerly Loewen Financial Inc.),
a company existing under the laws of Canada,
(hereinafter referred to as "LFI")
OF THE SECOND PART,
- and -
LOEWEN FINANCIAL LIMITED PARTNERSHIP,
a limited partnership existing under the laws of
the Province of Alberta acting through its General
Partner, 3546373 CANADA INC.
(hereinafter referred to as "LFLP")
OF THE THIRD PART,
- and -
LOEWEN LIMITED PARTNERSHIP,
a limited partnership existing under the laws
of the Province of British Columbia acting
through its General Partner, RAYMOND L. LOEWEN,
(hereinafter referred to as "LLP")
OF THE FOURTH PART,
- and -
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CANADIAN IMPERIAL BANK OF COMMERCE,
a Canadian chartered bank, acting through its
CIBC Capital Partners Division,
(hereinafter referred to in such capacity as the "CIBCCP"),
OF THE FIFTH PART.
WHEREAS Loewen and CIBCCP are parties to a Second Amended and Restated
Credit Agreement made as of November 2, 1998 (the "Loan Agreement");
AND WHEREAS prior to the execution and delivery of this Agreement:
(i) LLP transferred to Loewen all of the right, title and interest
of LLP to 239,200 common shares (the "Common Shares") in the
capital of The Loewen Group Inc., the certificates for which
are set forth in Part I of Schedule A hereto (the "LLP
Transfer");
(ii) thereafter, LFI transferred to Loewen all of the right, title
and interest to 5,107,600 Common Shares, the certificates for
which are set forth in Part II of Schedule A hereto (the "LFI
Transfer"); and
(iii) thereafter, LFLP transferred to LFI all of the right, title
and interest of LFLP to 3,879,325 Common Shares, the
certificates for which are set forth in Part III of Schedule A
hereto and thereafter, LFI transferred to Loewen all of LFI's
right, title and interest to such Common Shares (such
transfers referred to collectively as the "LFLP Transfer")
(the LLP Transfer, the LFI Transfer and the LFLP Transfer
being collectively referred to as the "Affiliate Transfers").
AND WHEREAS Loewen wishes to sell, and CIBCCP wishes to purchase, an
aggregate of 10,062,125 Common Shares (collectively, the "Purchased Shares") on
the terms and subject to the conditions set forth herein;
AND WHEREAS the Purchased Shares, details of which are set forth in
Schedule A hereto, are currently held by CIBCCP pursuant to the Continuing Loan
Documents;
NOW THEREFORE THIS AGREEMENT WITNESSES that, in consideration of the
covenants and agreements herein contained and for other good and valuable
consideration, the parties hereto agree as follows:
<PAGE>
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ARTICLE I
INTERPRETATION
1.1 DEFINITIONS. In this Agreement, unless something in the subject matter or
context is inconsistent therewith:
"ADDITIONAL CONSIDERATION" shall be calculated on the Sale Date (or if there is
more than one on the last Sale Date) and means the lesser of:
(i) the amount, if any, by which (A) the Sale Price shall exceed
(B) the Initial Consideration together with an amount equal
to interest that would accrue on the Initial Consideration
at the rate of 5.27% per annum calculated from and including
the date hereof to but excluding the Sale Date and
compounded quarterly; and
(ii) the aggregate amount of the Obligations on that date
(including accrued and unpaid interest), less the amount
then credited to the Cash Security Account;
"AFFILIATE TRANSFERS" has the meaning ascribed thereto in the recitals to this
Agreement;
"COMMON SHARES" has the meaning ascribed thereto in the recitals to this
Agreement;
"CURRENT OBLIGATIONS" means the amount of US$144,949,603, such amount being the
aggregate amount of the Obligations outstanding as at the date hereof before
giving effect to this Agreement consisting of (i) US$144,303,715 (such amount
being the principal amount of the indebtedness of Loewen under the Loan
Agreement) and (ii) US$645,888 (such amount being equal to the accrued but
unpaid interest under the Loan Agreement to the date hereof);
"INITIAL CONSIDERATION" has the meaning ascribed thereto in Section 2.1(b)(i);
"LOAN AGREEMENT" has the meaning ascribed thereto in the recitals to this
Agreement;
"LOEWEN AFFILIATES" means, collectively, LFI, LFLP and LLP;
"LOEWEN PARTIES" means, collectively, Loewen and the Loewen Affiliates;
"PURCHASED SHARES" has the meaning ascribed thereto in the recitals to this
Agreement;
"RELATED PARTY" means a person not dealing at arm's length with CIBCCP for the
purposes of the INCOME TAX ACT (Canada);
<PAGE>
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"SALE DATE" means the date, if any, on which a Sale of the Purchased Shares
shall be completed;
"SALE PRICE" means the aggregate amount or value of consideration received by
CIBCCP (or a Related Person as provided in Section 1.5) for the Purchased Shares
as a result of the Sale of the Purchased Shares net of all fees, expenses and
commissions paid or incurred by CIBCCP or such Related Person in connection
therewith; and
"SALE OF THE PURCHASED SHARES" means a bona fide sale or sales of the Purchased
Shares made by CIBCCP (or a Related Person as provided in Section 1.5)
subsequent to the date hereof and on or prior to November 1, 2000 to a person or
persons other than a Related Person;
1.2 OTHER DEFINITIONS. Capitalized terms used but not defined herein shall
have the respective meanings ascribed to them in the Loan Agreement.
1.3 SECTIONS AND HEADINGS. The division of this Agreement into Articles and
Sections and the insertion of headings are for convenience of reference only and
shall not affect the construction or interpretation of this Agreement. The
terms "this Agreement", "hereof", "hereunder" and similar expressions refer to
this Agreement and not to any particular Article, Section or other portion
hereof and include any agreement or instrument supplemental or ancillary hereto.
Unless something in the subject matter or context is inconsistent therewith,
references herein to Articles and Sections are to Articles and Sections of this
Agreement.
1.4 NUMBER. Words importing the singular number only shall include the plural
and VICE VERSA, words importing the masculine gender shall include the feminine
and neuter genders and VICE VERSA and words importing persons shall include
individuals, partnerships, associations, trusts, unincorporated organizations
and corporations and VICE VERSA.
1.5 TRANSFERS TO RELATED PERSONS. For the purposes of this Agreement, a sale
or other transfer of any of the Purchased Shares by CIBCCP to a Related Person
or by a Related Person to another Related Person shall be deemed not to be a
Sale of the Purchased Shares; provided that any sale of Purchased Shares by any
such Related Person to a person which is not a Related Person completed on or
prior to November 2, 2000 shall be deemed to be a Sale of the Purchased Shares
by CIBCCP for the purposes of the calculation of the Additional Consideration;
<PAGE>
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ARTICLE II
SALE OF PURCHASED SHARES
2.1 PURCHASE AND SALE OF PURCHASED SHARES.
(a) Subject to the terms and conditions hereof, Loewen hereby sells,
assigns and transfers to CIBCCP, and CIBCCP hereby purchases from
Loewen, all of the Purchased Shares.
(b) The aggregate purchase price (the "Purchase Price") for the Purchased
Shares shall be the aggregate of:
(i) US$91,188,008 (the "Initial Consideration") which shall be
paid and satisfied as provided in Section 2.2; and
(ii) the Additional Consideration, if any, which shall be paid and
satisfied as provided in Section 2.3.
2.2 PAYMENT OF INITIAL CONSIDERATION.
The Initial Consideration shall be paid and satisfied
contemporaneously with the execution and delivery of this Agreement as follows:
(a) as to US$86,606,996 by applying thereto an equal amount of the
Obligations and, it is hereby agreed that by reason of such
application the Obligations are reduced by the amount so applied; and
(b) as to US$4,581,012 by crediting such amount to the Cash Security
Account.
2.3 PAYMENT OF ADDITIONAL CONSIDERATION. The Additional Consideration, if any,
shall only be payable on the Sale Date (or if there is more than one on the last
Sale Date) if a Sale of the Purchased Shares occurs on or prior to November 1,
2000 and shall be satisfied by CIBCCP applying thereto an equal amount of the
Obligations then outstanding such that the aggregate amount of the Obligations
shall be reduced by the amount of the Additional Consideration.
2.4 DELIVERY OF PURCHASED SHARES. It is hereby agreed that the Purchased
Shares shall be deemed to be delivered to CIBCCP as the buyer thereof
contemporaneously with the execution and delivery of this Agreement free and
clear of all Liens (including the Lien of the Security Documents).
<PAGE>
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ARTICLE III
REPRESENTATIONS AND DELIVERIES
3.1 REPRESENTATIONS OF LOEWEN PARTIES. Each Loewen Party, jointly and
severally, represents and warrants as follows to CIBCCP and acknowledges and
confirms that CIBCCP is relying upon such representations and warranties:
(a) AUTHORIZATION. This Agreement and the Affiliate Transfers have been
duly authorized (in the case of each Loewen Affiliate in relation to
the Agreement), executed and delivered by each Loewen Party and
constitutes the legal, valid and binding obligation of each Loewen
Party enforceable against such Loewen Party in accordance with its
terms.
(b) CONFLICT WITH CONSTATING DOCUMENTS AND AGREEMENTS. Neither the
execution and delivery by a Loewen Party of this Agreement nor the
consummation by any such Loewen Party of any of the transactions
contemplated hereby nor the compliance by any such Loewen Party with
the terms, conditions and provisions hereof nor the consummation by
any Loewen Party of the Affiliate Transfers, conflicts with or results
in a breach of any of the terms, conditions or provisions of:
(i) in the case of a Loewen Affiliate, the partnership agreement
or constating documents or by-laws of any such Loewen
Affiliate;
(ii) any agreement, instrument or arrangement to which any such
Loewen Party is now a party or by which it, or its properties
are, or may be, bound, or constitutes a default thereunder;
(iii) any judgment or order, writ, injunction, decree or ruling of
any Official Body; or
(iv) any applicable law.
(c) NO OTHER AUTHORIZATION NECESSARY. No action of, or filing with, any
Official Body is or was required to authorize, or is or was otherwise
required in connection with, the Affiliate Transfers or the execution,
delivery and performance by any Loewen Party of this Agreement or the
completion of any transaction contemplated thereby.
(d) STATUS AND POWER. LFI is a company duly continued and validly
subsisting under the CANADA BUSINESS CORPORATIONS ACT; LLP is a
limited partnership duly constituted and organized and validly
subsisting under the laws of the Province of British Columbia; LFLP is
a limited partnership duly constituted, organized and validly
subsisting under the laws of the Province of Alberta; each Loewen
Affiliate has adequate and sufficient power and authority to execute,
deliver and perform its obligations under
<PAGE>
- 7 -
this Agreement and to undertake any transaction contemplated thereby
(including the Affiliate Transfers).
(e) PURCHASED SHARES. The Purchased Shares are beneficially owned by
Loewen and Loewen has good and marketable title thereto, free and
clear of all Liens other than Liens created by the Security Documents.
(f) CONTROL. The Loewen Parties, together with the Associates of the
Loewen Parties and any other Person with whom the Loewen Parties or
their Associates are acting jointly or in concert or who is part of a
group established for the purpose of holding, disposing, acquiring or
voting of any securities of the Corporation (or securities convertible
into or exchangeable or exercisable for securities of the Corporation)
do not own more than 20% of the issued and outstanding Voting
Securities of the Corporation.
(g) NO MATERIAL FACTS. None of the Loewen Parties has knowledge of any
material fact or material change (as such terms are defined under
applicable Canadian securities laws) relating to the Corporation or
the Purchased Shares that has not been generally disclosed.
3.2 NATURE OF REPRESENTATIONS AND WARRANTIES. The representations and
warranties set out in Section 3.1 shall survive the execution and delivery of
this Agreement and CIBCCP shall be deemed to have relied on the making of such
representations and warranties.
3.3 DELIVERIES. Contemporaneously with the execution and delivery of this
Agreement, the Loewen Parties shall deliver to CIBCCP the following, in form and
terms reasonably satisfactory to CIBCCP:
(a) copies of all agreements, documents and corporate and partnership
proceedings, authorizing the implementation by any of the Loewen
Parties, or otherwise relating to, the Affiliate Transfers and this
Agreement; and
(b) a legal opinion or legal opinions as to the due authorization,
execution and delivery of this Agreement by the Loewen Parties and as
to the legality, validity, binding nature and enforceability of this
Agreement against each of the Loewen Parties.
<PAGE>
- 8 -
ARTICLE IV
GENERAL
4.1 COSTS AND EXPENSES. The Loewen Parties agree that CIBCCP may deduct from
the amount held in the Cash Security Account an amount equal to all reasonable
costs and expenses incurred by the CIBCCP in connection with negotiation,
preparation, execution, delivery and administration of this Agreement including,
without limitation, the fees and out-of-pocket expenses of counsel to CIBCCP.
4.2 INDEMNIFICATION BY THE LOEWEN PARTIES. Each Loewen Party, jointly and
severally, shall indemnify CIBCCP from and against all losses, liabilities,
damages, penalties, costs and expenses (excluding consequential damages and loss
of profits) ("Losses"), imposed on or incurred or suffered by CIBCCP or any of
its directors, officers, employees or agents as a consequence of or relating to
or arising out of any inaccuracy or breach by any Loewen Party of its
representations and warranties or any of its covenants contained herein,
including Losses arising under any applicable securities laws or stock exchange
rules, or in relation to any investigation or proceeding thereunder, as a result
of CIBCCP's reliance upon any such representations, warranties or covenants in
connection with any disposition of any Purchased Shares.
4.3 SURVIVAL. All covenants, agreements, representations and warranties made
herein shall survive the execution and delivery of this Agreement and shall
continue in full force and effect without limitation in time.
4.4 GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the Province of Ontario and the federal laws of
Canada applicable therein.
4.5 COURTS. Any legal action or proceeding with respect to this Agreement may
be brought in the courts of the Province of Ontario or British Columbia which
courts the parties hereto acknowledge irrevocably to be a convenient forum for
the resolution of any such legal action or proceeding. Each Loewen Party hereby
accepts, for himself or itself and in respect of his or its assets and revenues,
generally and unconditionally, the non-exclusive jurisdiction of the aforesaid
courts.
4.6 FURTHER ASSURANCES. Each Loewen Party, at its expense, will promptly
execute and deliver, to CIBCCP, upon request, all such other and further
documents, agreements, certificates and instruments in compliance with, or
accomplishment of the covenants, and agreements of the Loewen Parties under this
Agreement or more fully to state the obligations of the Loewen Parties as set
out therein or to make any recording, file any notice or obtain any consents,
all as may be necessary or appropriate in connection therewith.
4.7 EXECUTION IN COUNTERPARTS. This Agreement may be executed in counterparts,
each of which shall be considered an original and all of which counterparts
taken together shall constitute a single agreement.
<PAGE>
- 9 -
4.8 ASSIGNMENTS AND TRANSFER. This Agreement shall be binding upon and enure
to the benefit of Loewen and his heirs, representatives and executors and on
each Loewen Affiliate and its successors. This Agreement shall be binding upon
and enure to the benefit of CIBCCP and its successors and assigns. No Loewen
Party shall have the right to assign its rights or obligations hereunder.
CIBCCP may from time to time may assign all of or any undivided portion of its
rights and obligations under this Agreement to any Person on such terms and
conditions as CIBCCP shall approve in its sole discretion.
IN WITNESS WHEREOF the parties hereto have caused this Agreement to be
executed on November 2, 1998.
SIGNED, SEALED AND )
DELIVERED in the )
presence of: ) -----------------------------------
) Raymond L. Loewen
)
3546373 CANADA INC.
by
-------------------------------------
Raymond L. Loewen
President
3546373 CANADA INC. in its capacity as
general partner of and on behalf of LOEWEN
FINANCIAL LIMITED PARTNERSHIP
by
-------------------------------------
Raymond L. Loewen
President
RAYMOND L. LOEWEN, in his capacity as general
partner of and on behalf of LOEWEN LIMITED
PARTNERSHIP
--------------------------------
<PAGE>
- 10 -
CANADIAN IMPERIAL BANK OF COMMERCE (acting
through CIBC CAPITAL PARTNERS DIVISION)
By:
------------------------------------------
------------------------------------------
<PAGE>
[LETTERHEAD OF CANADIAN IMPERIAL BANK OF COMMERCE]
November 2, 1998
Raymond L. Loewen
4126 Norland Avenue
Burnaby, BC V6G 3S8
Dear Mr. Loewen:
SALE OF 10,062,125 COMMON SHARES
OF THE LOEWEN GROUP INC.
Pursuant to an agreement made the date hereof between you, 3546373
Canada Inc. (formerly Loewen Financial Inc.), Loewen Financial Limited
Partnership, Loewen Limited Partnership and Canadian Imperial Bank of Commerce
acting through its CIBC Capital Partners Division ("CIBCCP"), CIBCCP purchased
10,062,125 common shares (such common shares collectively, the "Block") of The
Loewen Group Inc.
CIBC hereby confirms that its current intention is to seek offers for
the sale of the Block and wishes to obtain your advice and assistance from time
to time at its request in connection therewith (such advise and assistance, the
"Services"). As part of the Services, you will promptly notify CIBCCP of any
potential purchasers of the Block of which you become aware and will, if and to
the extent requested by CIBCCP, assist CIBCCP in any discussions or negotiations
with any potential purchasers of the Block whether or not identified by you.
You will not, however, without the prior consent of CIBCCP, solicit any offers
for the purchase of the Block or initiate any discussions with any potential
purchasers of the Block. In addition, you will not take or participate in any
action which would prevent or otherwise adversely affect the obtaining offers
for or the sale of the Block or adversely affect the market value of the Block.
All information which you obtain in carrying out the Services (whether obtained
from CIBCCP or a potential purchaser) shall be confidential and you will not
disclose any such information to any person other than CIBCCP or persons
designated by CIBCCP. Notwithstanding the foregoing provisions of this
paragraph, in no event shall you be obliged to do any act or thing that would
constitute a breach of any fiduciary or similar duty you owe to The Loewen Group
Inc.
Your retainer hereunder shall commence on the date hereof and
shall end on the earlier of (i) the date on which CIBCCP closes its sale of the
Block (the "Sale Date") and (ii) March 31, 1999.
<PAGE>
- 2 -
In consideration for your providing the Services, CIBCCP will pay to
you a fee (plus any applicable goods and services tax) in an amount equal to 20%
of the amount, if any, by which:
(i) its net cash proceeds (after all reasonable fees, commissions
and out-of-pocket expenses, including fees of counsel) from
the sale of all or any portion of the Block;
shall exceed
(ii) the sum of (a) US $91,188,008; (b) US $58,342,607 less the
amount standing to your credit in the Cash Security Account
(as such term is defined in the Second Amended and Restated
Credit Agreement made as of November 2, 1998 between you and
CIBCCP) on the Sale Date; and (c) amount of interest that
would accrue on the amount referred to in item (a) from and
including the date hereof to but excluding the Sale Date at
the rate of 5.27% per annum calculated and compounded
quarterly,
provided, however, that CIBCCP shall not be obliged to make any payment to you
if the Sale Date shall not have occurred on or prior to March 31, 1999 unless
CIBCCP has, before April 1, 1999, entered into an agreement to sell the Block
and all government approvals and other conditions to such sale have not been
obtained or satisfied before April 1, 1999. CIBCCP's current intention is to
solicit only all-cash offers for the Block; provided however that if it decides
to accept an offer for the Block involving non-cash consideration in whole or in
part, the fee payable to you hereunder will be calculated with reference to the
fair market value of such non-cash consideration.
Until the earlier of (i) December 2, 1998 and (ii) the date on which
closing price for common shares in the capital of the Corporation on the New
York Stock Exchange (or if not listed or traded on the New York Stock Exchange,
the Equivalent Amount in U.S. Dollars of the closing price for the common shares
on The Toronto Stock Exchange or if not listed or traded or The Toronto Stock
Exchange, on the Montreal Exchange) is less than US$8.00, CIBCCP agrees that it
will not sell, assign or transfer the Block for consideration of less than
US$16.00 per share without your prior agreement to such sale.
It is agreed that until November 12, 1998 (or such earlier date as is
referred to in item (ii) of the preceding paragraph) CIBCCP will not solicit
offers for the Block from any persons other than the persons listed on Schedule
A hereto; provided that nothing contained herein shell prevent CIBCCP from
negotiating or discussing the sale of the Block during such period with any
person who may contact CIBCCP on an unsolicited basis for such purpose. After
the expiry of such period, CIBCCP may solicit offers for the Block from any
person which it considers to be a prospective purchaser of the Block.
<PAGE>
- 3 -
For greater certainty, it is agreed that if CIBCCP sells or otherwise
transfers the Block to a person or persons with whom it does not deal at arm's
length for the purposes of the INCOME TAX ACT (Canada) (collectively the
"Related Party"), no fee shall be payable to you in respect of any such sale or
transfer to the Related Party but CIBCCP shall continue to be obliged to pay you
for the Services and the amount of your fee shall be determined on the basis of
any sale of the Block by the Related Party as if the Related Party were CIBCCP.
If you agree to provide the Services on the terms and subject to the
conditions contained herein, please sign and return to us one signed copy of
this letter.
Yours truly,
CANADIAN IMPERIAL BANK OF COMMERCE acting
through its CIBC CAPITAL PARTNERS DIVISION
by
-----------------------------
-----------------------------------
-------------------------------------
I agree to provide the Services on the terms and subject to the
conditions set out above.
Dated the 2nd day of November, 1998.
SIGNED, SEALED AND DELIVERED )
in the presence of )
)
)
) -----------------------------------
) Raymond L. Loewen
