On August 26, 2022, StoneMor Inc. the guarantors named therein and Signature Bank, as Agent and sole initial lender, entered into a Loan and Security Agreement providing for a senior secured revolving line of credit facility that initially will be $45 million and, if additional commitments are received, may be increased to up to $60 million. The Loan Agreement provides for a revolving credit facility of up to the total commitments, which initially are $45 million and may be increased by an additional $15 million upon receipt of such additional commitments. The Loan Agreement includes a letter of credit subfacility of up to $20 million.

Loans under the Loan Agreement are subject to a borrowing base equal to the excess of (a) the sum of (i) unrestricted cash held in deposit accounts controlled by the Agent plus (ii) 40% of the book value of Eligible Unsold Burial Lots over (b) reserves established by the Agent in its reasonable discretion, including with respect to other products or services extended by any Lender to the Company. Loans may be prepaid at any time without penalty or premium (other than customary SOFR breakage indemnity provisions with respect to prepayment of Benchmark Rate Loans), and all Loans will be due and payable on August 26, 2027 unless payment is required sooner under the Loan Agreement. The proceeds of any Loans will be used from time to time to pay the fees and expenses of closing under the Loan Agreement and for working capital, acquisitions and other general corporate purposes.

The Company has the option of treating Loans as Base Rate Loans or Benchmark Rate Loans, and converting Base Rate Loans to Benchmark Rate Loans. Base Rate Loans will bear interest at a per annum rate equal to the sum of (a) (i) the prime rate as published in The Wall Street Journal, (ii) the Federal Funds Rate plus 0.50% or (iii) the Benchmark Interest Rate for a one-month interest period plus 1.0%, provided that the rate calculated under this clause (a) shall not be less than 2.0%, plus (b) 2.0%. Benchmark Rate Loans will bear interest at a per annum rate based on the interest period selected by the Company (which shall be one, three or six months) equal to the sum of (a) the Term SOFR Screen Rate with a term equivalent to the applicable interest period plus the SOFR Adjustment (which will be 0.1%, 0.15% and 0.25% for one-, three- and six-month interest periods, respectively), provided that the rate calculated under this clause (a) shall not be less than 1.0%, plus (b) 2.63%.

Interest shall be payable (a) for each Benchmark Rate Loan, on the last day of the applicable interest period and, if such interest period is more than three months, each three-month anniversary of the beginning of the interest period and (b) for all other Loans, on the first day of each calendar quarter. The Benchmark Rate as of August 26, 2022 was 3.87%.