As filed with the Securities and Exchange Commission on September 14, 2022

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

SCHEDULE 13E-3

Rule 13e-3 Transaction Statement under Section 13(e)
of the Securities Exchange Act of 1934
Amendment No. 1

STONEMOR INC.
(Name of the Issuer)

STONEMOR INC.
AXAR CAPITAL MANAGEMENT, LP
AXAR CEMETERY PARENT CORP.
AXAR CEMETERY MERGER CORP.
(Names of Persons Filing Statement)

COMMON STOCK, PAR VALUE $0.01 PER SHARE
(Title of Class of Securities)

86184W106
(CUSIP Number of Class of Securities)

Joseph M. Redling
StoneMor Inc.
3331 Street Road, Suite 200
Bensalem, PA 19020
(215)-826-2800
  
Andrew Axelrod
Axar Capital Management, LP
Axar Cemetery Parent Corp.
Axar Cemetery Merger Corp.
402 West 13th Street, Floor 2
New York, NY 10014
(212) 356-6130

With copies to:
Thomas G. Spencer
Duane Morris LLP
30 South 17th Street
Philadelphia, PA 19103
(215) 979-1000

F. Douglas Raymond, III
Elizabeth A. Diffley
Faegre Drinker Biddle & Reath LLP
One Logan Square, Suite 2000
Philadelphia, PA 19130
(215) 988-2700
  
Stuart D. Freedman
Jeffrey Symons
F. Xavier Kowalski
Schulte Roth & Zabel LLP
919 Third Avenue
New York, NY 10022
(212) 756-2000

 (Name, Address, and Telephone Numbers of Person Authorized to Receive
Notices and Communications on Behalf of the Persons Filing Statement)

This statement is filed in connection with (check the appropriate box):

a.
☒
The filing of solicitation materials or an information statement subject to Regulation 14A (§§ 240.14a-1 through 240.14b-2), Regulation 14C (§§ 240.14c-1 through 240.14c-101) or Rule 13e-3(c) (§ 240.13e-3(c)) under the Securities Exchange Act of 1934 (“the Act”).
 
b.
☐
The filing of a registration statement under the Securities Act of 1933.
 
c.
☐
A tender offer.
 
d.
☐
None of the above.

Check the following box if the soliciting materials or information statement referred to in checking box (a) are preliminary copies: ☒

Check the following box if the filing is a final amendment reporting the results of the transaction: ☐

NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THE TRANSACTION CONTEMPLATED HEREIN, PASSED UPON THE MERITS OR FAIRNESS OF SUCH TRANSACTION, OR PASSED UPON THE ADEQUACY OR ACCURACY OF THE DISCLOSURE IN THIS DOCUMENT.  ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.


 
Introduction

This Amendment No. 1 to the Transaction Statement on Schedule 13E-3 (as originally filed on August 5, 2022, and together with all exhibits thereto and hereto, (this “Schedule 13E-3”) is being filed with the Securities and Exchange Commission (the “SEC”) pursuant to Section 13(e) of the Securities Exchange Act, as amended (together with the rules and regulations promulgated thereunder, the “Exchange Act”), jointly by the following persons (each a “Filing Person,” and collectively the “Filings Persons”): (i) StoneMor Inc. (the “Company”), a Delaware corporation and the issuer of the shares of common stock, par value $0.01 per share (the “Shares”), that are subject to the transaction pursuant to Rule 13e-3 under the Exchange Act; (ii) Axar Capital Management, LP (“Axar”), a Delaware limited partnership; (iii) Axar Cemetery Parent Corp. (“Parent”), a Delaware corporation and an indirect, wholly-owned subsidiary of Axar; and (iv) Axar Cemetery Merger Corp. (“Merger Sub”), a Delaware corporation and an indirect, wholly-owned subsidiary of Parent.

As of July 25, 2022, Axar owned approximately 74.6% of the outstanding Shares.

On May 24, 2022, the Company, Parent, and Merger Sub entered into an Agreement and Plan of Merger (the “Merger Agreement”), which provides for, among other things, the merger of Merger Sub with and into the Company (the “Merger”), with the Company surviving the Merger as the surviving corporation and becoming a direct, wholly-owned subsidiary of Parent (the “Surviving Corporation”). If the Merger is completed, the Company, as the Surviving Corporation, will continue its operations under the name “StoneMor Inc.” as a privately-held company wholly owned by Parent. As a result of the Merger, the Shares will no longer be traded on the New York Stock Exchange.

The board of directors of the Company (the “Board”) (other than Andrew Axelrod, Chairman of the Board, who is the sole member of the general partner of Axar and did not attend the meeting at which the Board considered the Merger), based in part on the unanimous recommendation of its standing Conflicts Committee comprised solely of independent directors, has unanimously (i) determined that the Merger Agreement and the transactions contemplated thereby (the “Transactions”) are fair to, and in the best interest of, the Company and its stockholders (other than the holders of the Axar Shares and the Insider Shares, as such terms are defined in the Merger Agreement), (ii) approved the Merger Agreement and the consummation of the Transactions and (iii) recommended that the stockholders of the Company approve the Merger and the Transactions and adopt the Merger Agreement.

Concurrently with the filing of this Schedule 13E-3, the Company is filing with the SEC a preliminary proxy statement (the “Proxy Statement”) under Regulation 14A of the Exchange Act, relating to a special meeting of the stockholders of the Company at which the stockholders of the Company will consider and vote upon a proposal to adopt the Merger Agreement. The Merger remains subject to the satisfaction or waiver of the conditions set forth in the Merger Agreement, including obtaining the affirmative vote of (i) the holders of at least a majority of the issued and outstanding Shares, and (ii) the holders of at least a majority of the issued and outstanding Shares other than (A) Shares held by Parent and its wholly-owned subsidiaries and Shares beneficially owned by any affiliate of Parent and (B) Shares held by members of the Board, any “officer” of the Company (as defined by Rule 16a-1 under the Exchange Act) and any immediate family members of the members of the Board and officers of the Company, in each case of (i) and (ii) in accordance with the Company’s certificate of incorporation and bylaws and Delaware law.

If the Merger is completed, at the effective time of the Merger (the “Effective Time”):


 •
each outstanding Share, other than (i) Shares owned by Axar, Parent, Merger Sub or any fund or account managed by Axar (each, an “Axar Vehicle”) or any direct or indirect subsidiary of Axar, Parent, Merger Sub or any Axar Vehicle (collectively, “Axar Shares”), (ii) Shares held by the Company (the “Treasury Shares”) and (iii) Shares held by any holder of record of Common Stock who did not vote in favor of the Merger Proposal and is entitled to demand and validly demands appraisal of such Shares pursuant to, and complies in all respects with, Section 262 of the Delaware General Corporation Law (the “DGCL”) (the “Dissenting Shares” and together with the Axar Shares and the Treasury Shares, the “Excluded Shares”), will be cancelled and converted into the right to receive $3.50 in cash per Share, without interest (the “Merger Consideration”);
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 •
each Treasury Share will be cancelled without payment of any consideration thereof;


•
each Axar Share will be converted into one share of common stock of the Surviving Corporation;


•
each Dissenting Share will be cancelled and converted into the right to receive payment of such amounts that are payable in accordance with Section 262 of the DGCL and will not have the right to receive the Merger Consideration, unless and until such stockholder loses, waives or withdraws its rights as a dissenting Company stockholder;


•
each share of common stock, par value $0.01 per share, of Merger Sub will be converted into one share of common stock of the Surviving Corporation;


•
each outstanding award of phantom units, whether vested or unvested, will be cancelled and converted into the right to receive an amount in cash, without interest, equal to the product of (i) $3.50 and (ii) the number of Shares subject to such award of phantom units;


•
each restricted share that is subject to an award under the Company Equity Plan will vest in full and become free of restrictions and shall be converted into the right to receive $3.50 in cash without interest; and


•
With respect to each award of options to purchase Shares under the StoneMor 2019 Amended and Restated Long-Term Incentive Plan (the “Company Equity Plan”): (i) one-half of the options to purchase Shares subject to such award, rounded up to the nearest whole number (the “Cancelled Options”), will be cancelled and converted into the right to receive a lump sum cash payment equal to the product of (1) the excess, if any, of $3.50 over the applicable exercise price of such award and (2) the number of Shares subject to the Cancelled Options; and (ii) the balance of the options to purchase Shares subject to such award, rounded down to the nearest whole number (the “Converted Options”), will be assumed by Parent and converted into fully vested options to purchase, on the same terms and conditions as applicable to the option to purchase Shares prior to the Effective Time, that number of shares of common stock of Parent, par value $0.01 per share (the “Parent Shares”) rounded down to the nearest whole share (the “Converted Parent Options”), equal to the number of Shares subject to such option immediately prior to the Effective Time. The exercise price per share of Parent Shares subject to a Converted Parent Option will be an amount (rounded up to the nearest hundredth of a cent) equal to (1) the exercise price per Share subject to the applicable option award immediately prior to the Effective Time divided by (2) the quotient of $3.50 divided by the fair market value of a share of Parent Shares immediately following the Effective Time determined in accordance with Section 409A of the Internal Revenue Code of 1986, as amended.

Simultaneously with the Merger Agreement, Parent and a certain affiliate of Axar agreed to fund Parent with $98,000,000 for Parent to satisfy its payment obligations at closing. The Company, as an express third-party beneficiary, will be entitled to enforce such obligation. The obligation to fund the equity commitment is conditioned upon: (a) the satisfaction in full or waiver by Parent and Merger Sub of each of the conditions to Parent’s and Merger Sub’s obligations contained in the Merger Agreement to consummate the merger; and (b) the substantially concurrent consummation of the Merger pursuant to the terms of the Merger Agreement.

In connection with Transactions, a shareholders agreement will be entered into by Axar and all other shareholders of Parent, including any participant who acquires shares of Parent Shares pursuant to a Converted Parent Option.

Simultaneously with the execution and delivery of the Merger Agreement, each Axar Vehicle (other than Axar Cemetery Holdings, LLC, Parent and Merger Sub) entered into a limited guarantee pursuant to which, among other things, such Axar Vehicles have agreed to guarantee certain potential payment obligations of Parent and Merger Sub subject to the terms and conditions of such limited guarantee.
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The cross-references below are being supplied pursuant to General Instruction G to Schedule 13E-3 and show the location in the Proxy Statement of the information required to be included in response to the items of Schedule 13E-3. Pursuant to General Instruction F to Schedule 13E-3, the information contained in the Proxy Statement, including all appendices thereto, is incorporated in its entirety herein by this reference, and the responses to each item in this Schedule 13E-3 are qualified in their entirety by the information contained in the Proxy Statement and the appendices thereto. As of the date hereof, the Proxy Statement is in preliminary form and is subject to completion. Capitalized terms used but not defined in this Schedule 13E-3 shall have the meanings given to them in the Proxy Statement.

All information contained in this Schedule 13E-3 concerning each Filing Person has been supplied by such Filing Person. No Filing Person, including the Company, is responsible for the accuracy of any information supplied by any other Filing Person.

Item 1.
Summary Term Sheet.

The information set forth in the Proxy Statement under the following caption is incorporated herein by reference:

“Summary Term Sheet”

Item 2.
Subject Company Information.

(a)
Name and Address.  The Company’s name and the address and telephone of its principal executive offices are as follows:
StoneMor Inc.
3331 Street Road, Suite 200
Bensalem, Pennsylvania 19020
Telephone: (215) 826-2800

(b)
Securities.  The subject class of equity securities is the shares of common stock of the Company. As of July 25, 2022, 118,752,924 shares of common stock of the Company were outstanding.

(c)
Trading Market and Price.  The information set forth in the Proxy Statement under the following caption is incorporated herein by reference:
“Important Information Regarding StoneMor Inc. — Market Price of the Common Stock”

(d)
Dividends.  The information set forth in the Proxy Statement under the following captions is incorporated herein by reference:
“Important Information Regarding StoneMor Inc. — Dividends”
“The Merger Agreement — Conduct of Business Pending the Merger”

(e)
Prior Public Offerings.  The information set forth in the Proxy Statement under the following caption is incorporated herein by reference:
“Important Information Regarding StoneMor Inc. — Prior Public Offerings”

(f)
Prior Stock Purchases.  The information set forth in the Proxy Statement under the following captions is incorporated herein by reference:
“Important Information Regarding StoneMor Inc. — Issuer Purchases of Equity Securities”
“Important Information Regarding StoneMor Inc. — Transactions in Common Stock — Transactions by Axar Filing Persons”

Item 3.
Identity and Background of Filing Person.

(a)-(c)
Name and Address; Business and Background of Entities; Business and Background of Natural Persons.
 
The information set forth in the Proxy Statement under the following captions is incorporated herein by reference:
“Summary Term Sheet”
“The Parties to the Merger — StoneMor Inc.”
“The Parties to the Merger — Axar Cemetery Parent Corp.”
“The Parties to the Merger — Axar Cemetery Merger Corp.”
“The Parties to the Merger — Business and Background of Natural Persons Related to the Company”
“The Parties to the Merger — Business and Background of Persons Related to the Axar Filing Persons”

4

 
Item 4.
Terms of the Transaction.

(a)(1)
Tender Offers.  Not applicable.

(a)(2)
Mergers or Similar Transactions.  The information set forth in the Proxy Statement under the following captions is incorporated herein by reference:
“Summary Term Sheet”
“Questions and Answers About the Special Meeting and the Merger”
“Special Factors — Background of the Merger”
“Special Factors — Purpose and Reasons of the Company for the Merger; Recommendation of the Board and the Conflicts Committee; Fairness of the Merger”
“Special Factors — Certain Unaudited Prospective Financial Information”
“Special Factors — Opinion of the Conflicts Committee’s Financial Advisor”
“Special Factors — The Axar Group Members’ Purposes and Reasons for the Merger”
“Special Factors — Position of the Axar Group Members as to Fairness of the Merger”
“Special Factors — Plans for the Company After the Merger”
“Special Factors — Certain Effects of the Merger”
“Special Factors — Interests of the Company’s Directors and Executive Officers in the Merger”
“Special Factors — Accounting Treatment of the Merger”
“Special Factors — Material U.S. Federal Income Tax Consequences of the Merger”
“The Special Meeting — Required Vote”
“The Merger Agreement — Effect of the Merger on the Shares of Common Stock of the Company and Merger Sub”
“The Merger Agreement — Treatment of Company Equity Awards”
“The Merger Agreement — Payment for the Common Stock in the Merger”
“The Merger Agreement — Conditions to the Merger”
 Appendix A: Merger Agreement

(c)
Different Terms.  The information set forth in the Proxy Statement under the following captions is incorporated herein by reference:
“Summary Term Sheet”
“Questions and Answers About the Special Meeting and the Merger”
“Special Factors — Certain Effects of the Merger”
“Special Factors — Interests of the Company’s Directors and Executive Officers in the Merger”
“The Merger Agreement — Effect of the Merger on the Shares of Common Stock of the Company and Merger Sub”
“The Merger Agreement — Treatment of Company Equity Awards”
“Advisory Vote on Golden Parachute Compensation”

(d)
Appraisal Rights.  The information set forth in the Proxy Statement under the following captions is incorporated herein by reference:
“Summary Term Sheet”
“Questions and Answers About the Special Meeting and the Merger”
“Rights of Appraisal”
Appendix C: Section 262 of the General Corporation Law of the State of Delaware

(e)
Provisions for Unaffiliated Security Holders.  Not applicable.

(f)
Eligibility for Listing or Trading.  Not applicable.

5

 
Item 5.
Past Contacts, Transactions, Negotiations and Agreements.

(a)
Transactions.  The information set forth in the Proxy Statement under the following captions is incorporated herein by reference:
“Summary Term Sheet”
“Special Factors — Background to the Merger”
“Special Factors — Interests of the Company’s Directors and Executive Officers in the Merger”
“The Parties to the Merger — Company Transactions with the Axar Filing Persons”
 “The Merger Agreement — Treatment of Company Equity Awards”
“Important Information Regarding StoneMor Inc. — Security Ownership of Management and Certain Beneficial Owners”
“Important Information Regarding StoneMor Inc. — Transactions Between the Company and the Axar Filing Persons”

(b)-(c)
Significant Corporate Events; Negotiations or Contacts.  The information set forth in the Proxy Statement under the following captions is incorporated herein by reference:
“Summary Term Sheet”
“Special Factors — Background of the Merger”
“Special Factors — Purpose and Reasons of the Company for the Merger; Recommendation of the Board and the Conflicts Committee; Fairness of the Merger”
“The Merger Agreement”
Appendix A: Merger Agreement

(e)
Agreements Involving the Subject Company’s Securities.  The information set forth in the Proxy Statement under the following captions is incorporated herein by reference:
“Summary Term Sheet”
“Special Factors — Certain Effects of the Merger”
“Special Factors — Interests of the Company’s Directors and Executive Officers in the Merger “
“The Parties to the Merger — Company Transactions with the Axar Filing Persons”
“The Merger Agreement”
“Important Information Regarding StoneMor Inc. — Security Ownership of Management and Certain Beneficial Owners”
“Important Information Regarding StoneMor Inc. — Transactions Between the Company and the Axar Filing Persons”
Appendix A: Merger Agreement

Item 6.
Purposes of the Transaction and Plans or Proposals.

(b)
Use of Securities Acquired.  The information set forth in the Proxy Statement under the following captions is incorporated herein by reference:
“Summary Term Sheet”
“Special Factors — Plans for the Company After the Merger”
“Special Factors — Certain Effects of the Merger”
“Special Factors — Effects on the Company if the Merger is not Completed”
“Special Factors — Interests of the Company’s Directors and Executive Officers in the Merger”
“Special Factors — Delisting and Deregistration of the Common Stock”
“Special Factors — Payment of the Merger Consideration and Surrender of Stock Certificates”
 “The Merger Agreement—Effect of the Merger on the Shares of Common Stock of the Company and Merger Sub”
“The Merger Agreement—Treatment of Company Equity Awards”

(c)(1)-(8)
Plans.  The information set forth in the Proxy Statement under the following captions is incorporated herein by reference:
“Summary Term Sheet”
“Questions and Answers About the Special Meeting and the Merger”
“Special Factors — Background of the Merger”
“Special Factors — Purpose and Reasons of the Company for the Merger; Recommendation of the Board and the Conflicts Committee; Fairness of the Merger”
“Special Factors — The Axar Group Members’ Purposes and Reasons for the Merger”
“Special Factors — Position of the Axar Group Members as to Fairness of the Merger”
“Special Factors — Plans for the Company After the Merger”
“Special Factors — Certain Effects of the Merger”
“Special Factors — Interests of the Company’s Directors and Executive Officers in the Merger”
“Special Factors — Delisting and Deregistration of the Common Stock”
“The Merger Agreement — Structure of the Merger”
“The Merger Agreement — Effect of the Merger on the Shares of Common Stock of the Company and Merger Sub”
“The Merger Agreement — Treatment of Company Equity Awards”
“The Merger Agreement — Payment for the Common Stock in the Merger”
“Delisting and Deregistration of Common Stock”
Appendix A: Merger Agreement

6

 
Item 7.
Purposes, Alternatives, Reasons and Effects.

(a)
Purposes.  The information set forth in the Proxy Statement under the following captions is incorporated herein by reference:
“Special Factors — Background of the Merger”
“Special Factors — Purpose and Reasons of the Company for the Merger; Recommendation of the Board and the Conflicts Committee; Fairness of the Merger”
“Special Factors — The Axar Group Members’ Purposes and Reasons for the Merger”
“Special Factors — Position of the Axar Group Members as to Fairness of the Merger”
“Special Factors — Plans for the Company After the Merger”

(b)
Alternatives.  The information set forth in the Proxy Statement under the following captions is incorporated herein by reference:
“Special Factors — Background of the Merger”
“Special Factors — Purpose and Reasons of the Company for the Merger; Recommendation of the Board and the Conflicts Committee; Fairness of the Merger”

(c)
Reasons.  The information set forth in the Proxy Statement under the following captions is incorporated herein by reference:
“Special Factors — Background of the Merger”
“Special Factors — Purpose and Reasons of the Company for the Merger; Recommendation of the Board and the Conflicts Committee; Fairness of the Merger”
“Special Factors — The Axar Group Members’ Purposes and Reasons for the Merger”
“Special Factors — Position of the Axar Group Members as to Fairness of the Merger”
“Special Factors — Plans for the Company After the Merger”

(d)
Effects.  The information set forth in the Proxy Statement under the following captions is incorporated herein by reference:
“Summary Term Sheet”
“Questions and Answers About the Special Meeting and the Merger”
“Special Factors — Background of the Merger”
“Special Factors — Purpose and Reasons of the Company for the Merger; Recommendation of the Board and the Conflicts Committee; Fairness of the Merger”
“Special Factors — The Axar Group Members’ Purposes and Reasons for the Merger”
“Special Factors — Position of Axar Group Members as to Fairness of the Merger”
“Special Factors — Plans for the Company After the Merger”
“Special Factors — Certain Effects of the Merger”
“Special Factors — Effects on the Company if the Merger Is Not Completed”
“Special Factors — Interests of the Company’s Directors and Executive Officers in the Merger”
“Special Factors — Accounting Treatment of the Merger”
“Special Factors — Material U.S. Federal Income Tax Consequences of the Merger”
“Special Factors — Payment of the Merger Consideration and Surrender of Stock Certificates”
“The Merger Agreement — Effects of the Merger on the Shares of Common Stock of the Company and Merger Sub”
“The Merger Agreement — Treatment of Company Equity Awards”
“The Merger Agreement — Conduct of Business Pending the Merger”
“Rights of Appraisal”
Appendix A: Merger Agreement

7

 
Item 8.
Fairness of the Transaction.

(a)-(b)
Fairness; Factors Considered in Determining Fairness.  The information set forth in the Proxy Statement under the following captions is incorporated herein by reference:
“Summary Term Sheet”
“Questions and Answers About the Special Meeting and the Merger”
“Special Factors — Background of the Merger”
“Special Factors — Purpose and Reasons of the Company for the Merger; Recommendation of the Board and the Conflicts Committee; Fairness of the Merger”
“Special Factors — Certain Unaudited Prospective Financial Information”
“Special Factors — Opinion of the Conflicts Committee’s Financial Advisor”
“Special Factors — The Axar Group Members’ Purposes and Reasons for the Merger”
“Special Factors — Position of Axar Group Members as to Fairness of the Merger”
“Special Factors — Certain Effects of the Merger”
“Special Factors — Interests of the Company’s Directors and Executive Officers in the Merger”
Appendix B: Opinion of Duff & Phelps
Appendix C: Prospective Financial Information
 
In addition, the preliminary presentation of Duff & Phelps to the Conflicts Committee, dated January 10, 2022, and the presentation of Duff & Phelps to the Conflicts Committee, dated May 21, 2022, are attached to this Schedule 13E-3 as Exhibits (c)(2) and (c)(3), respectively.

(c)
Approval of Security Holders.  The information set forth in the Proxy Statement under the following caption is incorporated herein by reference:
“The Special Meeting — Required Vote”

(d)-(e)
Unaffiliated Representative; Approval of Directors.  The information set forth in the Proxy Statement under the following captions is incorporated herein by reference:
“Special Factors — Background of the Merger”
“Special Factors — Purpose and Reasons of the Company for the Merger; Recommendation of the Board and the Conflicts Committee; Fairness of the Merger”

(f)
Other Offers.  The information set forth in the Proxy Statement under the following caption is incorporated herein by reference:
“Special Factors — Background of the Merger”
 
Item 9.
Reports, Opinions, Appraisals and Negotiations.

(a)-(c)
Report, Opinion, or Appraisal; Preparer and Summary of the Report, Opinion, or Appraisal; Availability of Documents.  The information set forth in the Proxy Statement under the following captions is incorporated herein by reference:
“Summary Term Sheet”
“Special Factors — Background of the Merger”
“Special Factors — Purpose and Reasons of the Company for the Merger; Recommendation of the Board and the Conflicts Committee; Fairness of the Merger”
“Special Factors — Opinion of the Conflicts Committee’s Financial Advisor”
“Special Factors — The Axar Group Members’ Purpose and Reasons for the Merger”
“Special Factors — Position of the Axar Group Members as to Fairness of the Merger”
“Where Stockholders Can Find More Information”
Appendix B: Opinion of Duff & Phelps
 
In addition, the preliminary presentation of Duff & Phelps to the Conflicts Committee, dated January 10, 2022, and the presentation of Duff & Phelps to the Conflicts Committee, dated May 21, 2022, are attached to this Schedule 13E-3 as Exhibits (c)(2) and (c)(3), respectively.
 
The reports, opinions or appraisals referenced in this Item 9 will be made available for inspection and copying at the principal executive offices of the Company during regular business hours.

8

 
Item 10.
Source and Amounts of Funds or Other Consideration.

(a); (c)
Source of Funds; Expenses.  The information set forth in the Proxy Statement under the following captions is incorporated herein by reference:
“The Merger Agreement — Equity Commitment Letter”
“The Merger Agreement — Limited Guarantee”
“Special Factors — Fees and Expenses”
Appendix A: Merger Agreement
 
Equity Commitment Letter, dated May 24, 2022, by and between US Cemetery Holdings LLC, Axar Cemetery Parent Corp., Axar Cemetery Merger Corp. and StoneMor Inc. is attached hereto as Exhibit (d)(2) and is incorporated herein by reference.

(b)
Conditions.  The information set forth in the Proxy Statement under the following caption is incorporated herein by reference:
“The Merger Agreement — Equity Commitment Letter”
 
Equity Commitment Letter, dated May 24, 2022, by and between US Cemetery Holdings LLC, Axar Cemetery Parent Corp., Axar Cemetery Merger Corp. and StoneMor Inc. is attached hereto as Exhibit (d)(2) and is incorporated herein by reference.

(d)
Borrowed Funds.  Not applicable.

Item 11.
Interest in Securities of the Subject Company.

(a)
Securities Ownership.  The information set forth in the Proxy Statement under the following caption is incorporated herein by reference:
“Special Factors — Interests of the Company’s Directors and Executive Officers in the Merger”
“Important Information Regarding StoneMor Inc. — Security Ownership of Management and Certain Beneficial Owners”

(b)
Securities Transactions.  The information set forth in the Proxy Statement under the following captions is incorporated herein by reference:
“Important Information Regarding StoneMor Inc. — Issuer Purchases of Equity Securities”
“Important Information Regarding StoneMor Inc. — Transactions in Common Stock — Transactions by the Company”
“Important Information Regarding StoneMor Inc. — Transactions in Common Stock — Transactions by the Company’s Directors and Executive Officers”
“Important Information Regarding StoneMor Inc. — Transactions in Common Stock — Transactions by the Axar Filing Persons”

Item 12.
The Solicitation or Recommendation.

(d)
Intent to Tender or Vote in a Going-Private Transaction.  The information set forth in the Proxy Statement under the following caption is incorporated herein by reference:
“Special Factors — Interests of the Company’s Directors and Executive Officers in the Merger”
“The Merger Agreement — Other Covenants and Agreements”

(e)
Recommendations of Others.  The information set forth in the Proxy Statement under the following caption is incorporated herein by reference:
“Summary Term Sheet”
“Special Factors — Background of the Merger”
“Special Factors — Purpose and Reasons of the Company for the Merger; Recommendation of the Board and the Conflicts Committee; Fairness of the Merger”

9

 
Item 13.
Financial Statements.

(a)
Financial Information.  The information set forth in the Proxy Statement under the following captions is incorporated herein by reference:
“Important Information Regarding StoneMor Inc. — Book Value Per Share”
“Where Stockholders Can Find More Information”
 
The audited financial statements set forth in Item 8 of the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2021, filed with the SEC on March 31, 2022, are incorporated herein by reference.
 
The financial statements set forth in Item 1 of the Company’s Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2022, filed with the SEC on May 13, 2022, are incorporated herein by reference.

(b)
Pro Forma Information.  The information set forth in the Proxy Statement under the following caption is incorporated herein by reference:
“Special Factors — Certain Unaudited Prospective Financial Information”
Appendix C: Prospective Financial Information

Item 14.
Persons/Assets, Retained, Employed, Compensated or Used.

(a)
Solicitations or Recommendations.  The information set forth in the Proxy Statement under the following captions is incorporated herein by reference:
“Questions and Answers About the Special Meeting and the Merger”
“The Special Meeting — Solicitation of Proxies”
“Where Stockholders Can Find More Information”

(b)
Employees and Corporate Assets.  Not applicable.

Item 15.
Additional information.

(b)
Golden Parachute Payments. The information set forth in the Proxy Statement under the following captions is incorporated herein by reference:
“Special Factors — Interests of the Company’s Directors and Executive Officers in the Merger — Golden Parachute Compensation”
“Advisory Vote on Golden Parachute Compensation”

(c)
Other Material Information.  The information set forth in the Proxy Statement, including all appendices thereto, is incorporated herein by reference.

10

 
Item 16.
Exhibits.

Exhibit No.
Exhibit
   
(a)(1)
(a)(2)
(a)(3)
(a)(4)
(a)(5)
(c)(1)
(c)(2)
(c)(3)
(d)(1)
(d)(2)
(f)(1)
107

*
Previously filed with the Schedule 13E-3 filed with the SEC on August 5, 2022.
11

 
SIGNATURE

After due 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.

Date: September 14, 2022
STONEMOR INC.
     
 
By:
 /s/ Joseph M. Redling
 
Name: Joseph M. Redling
 
Title: President and Chief Executive Officer

After due 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.

Date: September 14, 2022
AXAR CAPITAL MANAGEMENT, LP
By: Axar GP, LLC, its General Partner
     
 
By:
 /s/ Andrew Axelrod
 
Name: Andrew Axelrod
 
Title: Sole Member

After due 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.

Date: September 14, 2022
AXAR CEMETERY PARENT CORP.
     
 
By:
 /s/ Andrew Axelrod
 
Name: Andrew Axelrod
 
Title: Chief Executive Officer

After due 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.

Date: September 14, 2022
AXAR CEMETERY MERGER CORP.
     
 
By:
 /s/ Andrew Axelrod
 
Name: Andrew Axelrod
 
Title: Chief Executive Officer


12
Exhibit (c)(2)


 StoneMor Inc.  Preliminary Valuation Discussion Materials  Prepared for the Conflicts Committee of the Board of Directors  of StoneMor Inc.  January 10, 2022  The information contained herein is of a confidential nature and is intended for the use of the persons or firm to whom it is furnished by us. Reproduction, publication, or dissemination of portions hereof may not be made without prior written approval of Kroll, LLC and its affiliates.  Confidential – DRAFT 
 
 Table of Contents  2  CONFIDENTIAL DRAFT  Section  1.  Introduction & Background  2.  Valuation Considerations and Methodology  3.  Valuation Analysis  Appendix  I.  Selected Public Companies / M&A Transactions Reviewed  II.  Selected Take-Private Transactions Reviewed 
 
 Introduction & Background  1. 
 
 Introduction & Background  4  CONFIDENTIAL DRAFT  Overview  The Board of Directors of StoneMor Inc. (“StoneMor”) received a letter (the “Letter”), dated September 22, 2021, from its current majority shareholder, Axar Capital Management, LP (“Axar”), in which Axar expressed an interest in pursuing discussions concerning strategic alternatives that may be beneficial to StoneMor and its various stakeholders  On September 26, 2021, the Board of Directors authorized its Conflicts Committee (“Conflicts Committee”) to engage in the discussions contemplated by the Letter  The Conflicts Committee has asked Duff & Phelps to:  Establish an independent view on the value of StoneMor common stock  Provide advice that will assist the Conflicts Committee in its discussions concerning, and consideration of, strategic alternatives pursuant to the Letter  These materials represent Duff & Phelps’ preliminary valuation report and discussion materials for the Conflicts Committee 
 
 Introduction & Background  Stock Analysis and Recent Events  Stock Price Summary  A  December 23, 2020: StoneMor received notification from the NYSE that the company has regained compliance with the listing criteria  Trading Commentary  B  March 24, 2021: StoneMor announced the acquisition of 4 cemeteries to expand east coast business  C  April 20, 2021: StoneMor announced a $400 million debt raise of senior secured notes  June 25, 2021: StoneMor joins the Russell 3000 and Russell Microcap Indexes  September 27, 2021: StoneMor announced Axar has expressed interest in pursuing discussions concerning strategic alternatives  D  Stock Price and Volume Analysis  Beneficial Ownership Summary (1)  A  B  C  D  E  E  (1) Excludes outstanding options, unvested RSUs, and director and select executive phantom units Source: S&P Capital IQ, Bloomberg, company filings, and StoneMor management  Data as of January 7, 2022  % of  Current  52-Week High  52-Week Low  60-Day VWAP  Shareholder  Shares  Outstanding  Trading Statistics  Average Closing Price  One Week  One Month  One Year  Three Years  Closing Trading Price  $2.40 $3.60  $1.66 $2.52  Axar Capital Management LP  Joseph M. Redling  88,633,045  1,354,459  74.93%  1.15%  Intraday Trading Price  $5.37  $1.51  David Miller  941,432  0.80%  Austin K. So  133,100  0.11%  $2.41  $2.39  $2.49  $1.89  Jeffrey DiGiovanni Lindsay Granson Stephen J. Negrotti Tom Connolly  59,182  57,195  48,634  14,247  0.05%  0.05%  0.04%  0.01%  Average Daily Volume (in thousands)  194  158  464  279  Spencer E. Goldenberg  10,000  0.01%  Avg. Daily Volume as a % of Shares Outstanding  0.2%  0.1%  0.4%  0.2%  Robert Page  8,190  0.01%  Patricia D. Wellenbach  6,064  0.01%  Amount of Beneficial Ownership  91,265,548  77.15%  All Remaining Shareholders 27,025,052 22.85%  Total Outstanding 118,290,600 100.00%  4  CONFIDENTIAL DRAFT 
 
 Introduction & Background  4  CONFIDENTIAL DRAFT  Business Plan  We have been provided with a forecast for StoneMor for a four-year period through 2025 including a GAAP  and non-GAAP P&L, a free cash flow forecast on a GAAP basis which incorporates changes in operating  assets (including the merchandise trust asset) and liabilities (including deferred revenue liabilities), and forecasted capital expenditure needs  It is our understanding that the projections include the following assumptions and considerations of historical and recent performance:  COVID-19 impact in 2020 and 2021 has driven at-need sales to record levels, and while such impact  persists, it is expected to lessen in 2022  Investment returns are assumed to be 6.5% in the forecast for both merchandise and perpetual trusts. Investment income on the merchandise and perpetual care trusts peaked in 2021, with returns of approximately 7.5%  Purchasing and procurement efforts have driven down average COGS over last 2+ years of transformation. Potential supply chain disruptions may increase average pricing into 2022 with cost increases expected to be passed to consumers  Increased payroll and payroll related costs are expected, and management sees opportunities to continue driving general and administrative cost savings and operational efficiency  $12 million of annual capital expenditures are assumed for maintenance and inventory needs 
 
 Valuation Considerations and Methodology  2. 
 
 Valuation Considerations and Methodology  GAAP and Non-GAAP Financial Statements  Material differences exist between GAAP and non-GAAP financials in both the historical and projected periods, driven in large part by revenue recognition on a GAAP basis of pre-need cemetery revenue  Historical & Projected Financial Performance - GAAP  ($ in thousands)   Management Projections   2018A  2019A  2020A  2021E  2022P  2023P  2024P  2025P  Total Revenue  $314,493  $289,571  $295,982  $321,671  $324,183  $341,909  $359,273  $372,894  Growth  (7.9%)  2.2%  8.7%  0.8%  5.5%  5.1%  3.8%  Adjusted EBITDA (1)  (2,072)  (12,373)  25,007  41,796  41,288  49,033  57,976  63,269  Margin  (0.7%)  (4.3%)  8.4%  13.0%  12.7%  14.3%  16.1%  17.0%  Growth  NM  NM  67.1%  (1.2%)  18.8%  18.2%  9.1%  (1) Includes stock-based compensation  Historical & Projected Financial Performance - Non-GAAP  ($ in thousands)   Management Projections   2018A  2019A  2020A  2021E  2022P  2023P  2024P  2025P  Total Revenue  $292,259  $279,634  $320,553  $396,711  $395,809  $414,816  $432,320  $450,692  Growth  (4.3%)  14.6%  23.8%  (0.2%)  4.8%  4.2%  4.2%  Adjusted EBITDA (1)  11,008  4,264  61,504  114,629  101,129  109,836  118,863  128,408  Margin  3.8%  1.5%  19.2%  28.9%  25.5%  26.5%  27.5%  28.5%  Growth  (61.3%)  1,342.3%  86.4%  (11.8%)  8.6%  8.2%  8.0%  (1) Includes stock-based compensation  10  CONFIDENTIAL DRAFT 
 
 Valuation Considerations and Methodology  10  CONFIDENTIAL DRAFT  Selected Public Companies / Precedent Transactions Methodology  The death care industry has a very limited number of publicly traded companies which operate funeral homes and cemeteries, as well as limited availability of precedent transactions with publicly reported financial information  Only three major participants have operations in the United States: Carriage Services, Inc., Park Lawn Corporation, and Service Corporation International  StoneMor operations are skewed much more heavily towards cemetery operations (~85% of revenues), while the other publicly traded death care companies derive a majority of their revenues from funeral home services  Contracts for funeral home services are typically sold on an at-need basis, in which case GAAP revenues are recognized within a short period of time after the sale of the funeral home contract  The difference in the timing of the recognition of GAAP revenues between StoneMor and the other publicly traded companies results in less comparability, making the application of a market multiple approach less meaningful as an indication of enterprise value 
 
 Valuation Considerations and Methodology  10  CONFIDENTIAL DRAFT  Discounted Cash Flow Methodology  As StoneMor is a Delaware Corporation, we believe that using a discounted cash flow approach is critical in valuing the company given the emphasis placed on this approach by Delaware courts  In conducting a discounted cash flow analysis we believe that free cash flow derived from GAAP financial statements is the best indication of actual cash flow and in turn would form the basis for a discounted cash flow model  We do not believe that a discounted cash flow analysis utilizing a forecast for the four-year period through 2025, and using an exit multiple on 2025 non-GAAP EBITDA to estimate the terminal value, constitutes a materially different analysis than that of a market multiple approach given that the majority of the overall value is captured in the terminal value  – This could be a concern in the event that a DCF analysis using an abbreviated forecast is challenged in the future  The lack of longer-term projections creates challenges in establishing accurate terminal or “steady-state”  assumptions to be used in a Gordon Growth terminal value estimation 
 
 Valuation Considerations and Methodology  10  CONFIDENTIAL DRAFT  Extended Long-Term Forecast for DCF Valuation  A valuation of StoneMor utilizing a discounted cash flow analysis would need to capture the value of the backlog as well as the continuing value of the business from sales to future customers  Therefore, Duff & Phelps has requested, and management has provided, an extended financial forecast (the “Management Projections”) which includes a run-off of the existing deferred revenue balance (which would capture the conversion of historical non-GAAP revenue to a GAAP cash flow basis)  We believe the risks associated with executing on the forecasted sales to future customers, strategic initiatives, and projected cost savings presented in the business plan would necessitate the application of a higher discount rate than the cash flow associated with the run-off of the backlog 
 
 Valuation Analysis  3. 
 
 Valuation Analysis  Projected Financial Performance  Projected Financial Performance - GAAP  ($ in thousands)   Management Projections   2022P  2023P  2024P  2025P  2026P  2027P  2028P  2029P  2030P  2031P  2032P  2033P  2034P  2035P  2036P  Total Revenue  $324,183  $341,909  $359,273  $372,894  $387,087  $401,739  $416,904  $432,601  $448,851  $465,677  $483,101  $501,148  $519,845  $539,220  $559,302  Growth  0.8%  5.5%  5.1%  3.8%  3.8%  3.8%  3.8%  3.8%  3.8%  3.7%  3.7%  3.7%  3.7%  3.7%  3.7%  Adjusted EBITDA (1)  41,288  49,033  57,976  63,269  70,033  75,860  81,809  87,875  94,052  100,335  106,714  113,182  119,727  126,337  132,999  Margin  12.7%  14.3%  16.1%  17.0%  18.1%  18.9%  19.6%  20.3%  21.0%  21.5%  22.1%  22.6%  23.0%  23.4%  23.8%  Growth  (1.2%)  18.8%  18.2%  9.1%  10.7%  8.3%  7.8%  7.4%  7.0%  6.7%  6.4%  6.1%  5.8%  5.5%  5.3%  Capital Expenditures  12,000  12,000  12,000  12,000  12,000  12,000  12,000  12,000  12,000  12,000  12,000  12,000  12,000  12,000  12,000  as % of Total Revenue  3.7%  3.5%  3.3%  3.2%  3.1%  3.0%  2.9%  2.8%  2.7%  2.6%  2.5%  2.4%  2.3%  2.2%  2.1%  Net Operating Assets and Liabilities  (242,653)  (246,370)  (248,553)  (250,043)  (237,376)  (223,650)  (208,884)  (193,106)  (176,351)  (158,664)  (140,099)  (120,718)  (100,592)  (79,800)  (58,432)  as % of Total Revenue  (74.9%)  (72.1%)  (69.2%)  (67.1%)  (61.3%)  (55.7%)  (50.1%)  (44.6%)  (39.3%)  (34.1%)  (29.0%)  (24.1%)  (19.4%)  (14.8%)  (10.4%)  (1) Includes stock-based compensation  13  CONFIDENTIAL DRAFT 
 
 Valuation Analysis  13  CONFIDENTIAL DRAFT  Discounted Cash Flow Analysis - Key Assumptions  Duff & Phelps used the Management Projections for the fiscal years (“FY”) ending December 31, 2022 through December 31, 2036 as the basis for the discounted cash flow analysis.  Under the Management Projections:  Total Revenue increases at a compound annual growth rate (“CAGR”) of 3.8% for the fifteen-year period from FY2021 through FY2036.  Adjusted EBITDA increases at a CAGR of 8.0% for the fifteen-year period from FY2021 through FY2036, with an average Adjusted EBITDA margin of 19.6% over the FY2022 to FY2036 projection period.  Capital expenditures are assumed to be $12 million per year, or an average of 2.8% of Total Revenue over the FY2022 to FY2036 projection period.  Net operating assets and liabilities average negative 44.4% of Total Revenue over the FY2022 to FY2036 projection period.  Beyond the projection period, Duff & Phelps estimated the “terminal value” using a terminal growth rate of 3.0%.  Discount Rates:  The resulting cash flows attributable to projected future sales and an estimated terminal value were discounted at a weighted average cost of capital (“WACC”) range of 8.50% to 9.50%.  The resulting cash flows attributable to the deferred revenue backlog, including the trust income earned on the backlog, were discounted at a weighted discount rate of 3.50%.  The implied weighted discount rate range, based on discounting the performance attributable to backlog at a lower rate than expected future sales, is 8.40% to 9.40%. 
 
 Valuation Analysis  Discounted Cash Flow Analysis – WACC Analysis  Weighted Average Cost of Capital Analysis  Hamada  Harris-Pringle  Levered Beta  Discount  Rate Range  Discount  Rate Range  Sources and Considerations  Unlevered Beta  0.65  0.80  0.70  0.85  Selected Public Companies  Debt % of Capital  20%  30%  20%  30%  Selected Public Companies  Equity % of Capital  80%  70%  80%  70%  Selected Public Companies  Tax Rate  25.8%  25.8%  Not Used  Not Used  Blended Federal & State Corporate Income Tax Rate; Management Discussion  Debt Beta  Not Used  Not Used  0.36  0.37  Duff & Phelps  Levered Beta  0.77  1.05  0.79  1.06  Levered Cost of Equity  Risk-free Rate  2.5%  2.5%  2.5%  2.5%  Average Historical Yield on Treasury  Levered Beta  0.77  1.05  0.79  1.06  See Above  Market Risk Premium  5.5%  5.5%  5.5%  5.5%  Duff & Phelps Study  Size Premium  1.5%  5.0%  1.5%  5.0%  2021 CRSP Deciles Size Premia Study; Duff & Phelps Cost of Capital Study  Levered Cost of Equity  8.2%  13.3%  8.3%  13.3%  Cost of Debt  Cost of Long-term Debt  4.9%  6.2%  4.9%  6.2%  BB and B Bond Rate  Tax Rate  25.8%  25.8%  25.8%  25.8%  Blended Federal & State Corporate Income Tax Rate; Management Discussion  After-tax Cost of Debt  3.6%  4.6%  3.6%  4.6%  Weighted Average Cost of Capital (WACC)  Debt % of Capital  20%  30%  20%  30%  Equity % of Capital  80%  70%  80%  70%  Calculated WACC  7.29%  10.67%  7.35%  10.67%  Calculated WACC Average  8.98%  9.01%  Selected WACC  9.00%  13  CONFIDENTIAL DRAFT 
 
 Valuation Analysis  Discounted Cash Flow Analysis  Discounted Cash Flow Analysis  ($ in thousands)   Management Projections Normalized  '21 - '36  '22 - '36  Terminal Growth Rate  3.00%  3.00%  3.00%  WACC Applied to Projected Future Sales  9.50%  9.00%  8.50%  Discount Rate Applied to Backlog  3.50%  3.50%  3.50%  Weighted Discount Rate (1)  9.40%  8.90%  8.40%  Concluded Enterprise Value Range (Rounded)  $644,800  $700,900  $767,500   Implied Enterprise Value Multiples   2021E Adj. EBITDA  $41,796  15.4x  16.8x  18.4x  2022P Adj. EBITDA  41,288  15.6x  17.0x  18.6x  2023P Adj. EBITDA  49,033  13.2x  14.3x  15.7x  2021E Total Revenue  321,671  2.00x  2.18x  2.39x  2021E Non-GAAP Adj. EBITDA  $114,629  5.6x  6.1x  6.7x  2022P Non-GAAP Adj. EBITDA  101,129  6.4x  6.9x  7.6x  2023P Non-GAAP Adj. EBITDA  109,836  5.9x  6.4x  7.0x  2021E Non-GAAP Total Revenue  396,711  1.63x  1.77x  1.93x  (1) Weighted discount rate based on an approach that discounts the performance attributable to backlog at a lower rate than expected future sales  2021E  2022P  2023P  2024P  2025P  2026P  2027P  2028P  2029P  2030P  …  2036P  Terminal  CAGR  Average  Total Revenue  $321,671  $324,183  $341,909  $359,273  $372,894  $387,087  $401,739  $416,904  $432,601  $448,851  …  $559,302  $559,302  3.8%  Growth  8.7%  0.8%  5.5%  5.1%  3.8%  3.8%  3.8%  3.8%  3.8%  3.8%  3.7%  Adjusted EBITDA  41,796  41,288  49,033  57,976  63,269  70,033  75,860  81,809  87,875  94,052  …  132,999  132,999  8.0%  EBITDA Margin  13.0%  12.7%  14.3%  16.1%  17.0%  18.1%  18.9%  19.6%  20.3%  21.0%  23.8%  23.8%  19.6%  Earnings Before Interest and Taxes  $22,887  $31,433  $41,074  $46,966  $54,238  $60,484  $65,614  $70,868  $76,236  …  $110,051  $121,599  Pro Forma Taxes @ 25.8%  (5,901)  (8,105)  (10,591)  (12,110)  (13,985)  (15,596)  (16,918)  (18,273)  (19,657)  …  (28,376)  (31,354)  Net Operating Profit After Tax  16,986  23,328  30,483  34,856  40,253  44,889  48,696  52,595  56,579  …  81,674  90,245  Tax Depreciation  9,997  8,842  7,774  6,785  5,871  5,026  5,399  5,743  6,062  …  7,722  5,700  Amortization of Cemetery Property  8,404  8,758  9,129  9,517  9,924  10,350  10,796  11,264  11,754  …  15,227  5,700  Capital Expenditures  (12,000)  (12,000)  (12,000)  (12,000)  (12,000)  (12,000)  (12,000)  (12,000)  (12,000)  …  (12,000)  (12,000)  (Increase) Decrease in Net Op. Assets and Liabilities  5,835  3,717  2,183  1,490  (12,667)  (13,726)  (14,766)  (15,779)  (16,755)  …  (21,368)  (21,368)  Free Cash Flow  $29,221  $32,646  $37,568  $40,648  $31,381  $34,538  $38,124  $41,823  $45,640  …  $71,255  $68,277  Enterprise Value Low Mid High   13  CONFIDENTIAL DRAFT 
 
 Valuation Analysis  Valuation Summary  13  CONFIDENTIAL DRAFT  Current  Share Price (7)  $2.40  Valuation Summary  ($ in thousands)  Low  Mid  High  WACC Applied to Projected Future Sales  9.50%  9.00%  8.50%  Discount Rate Applied to Backlog  3.50%  3.50%  3.50%  Weighted Discount Rate (1)  9.40%  8.90%  8.40%  Enterprise Value  Discounted Cash Flow Analysis  $644,800  $700,900  $767,500  Present Value of Tax Attributes (2)  10,480  10,623  10,776  Present Value of Tax Amortization Benefit  10,628  10,785  10,947  Enterprise Value (Rounded)  $665,900  $722,300  $789,200  Plus: Cash and Equivalents (3)  87,891  87,891  87,891  Less: Debt (3) (4)  (405,775)  (405,775)  (405,775)  Aggregate Equity Value  $348,016  $404,416  $471,316  Less: Fair Value of Options, After-Tax (5)  (8,505)  (10,432)  (12,757)  Aggregate Common Equity Value  $339,510  $393,984  $458,559  Fully Diluted Shares Outstanding (000s) (6)  119,024  119,024  119,024  Resulting Per Share Price  $2.85  $3.31  $3.85  Implied Premium to Current Share Price  18.9%  37.9%  60.5%   Implied Enterprise Value Multiples   2021E Non-GAAP Adj. EBITDA  $114,629  5.8x  6.3x  6.9x  2022P Non-GAAP Adj. EBITDA  101,129  6.6x  7.1x  7.8x  2023P Non-GAAP Adj. EBITDA  109,836  6.1x  6.6x  7.2x  2021E Non-GAAP Total Revenue  396,711  1.68x  1.82x  1.99x   Implied Enterprise Value Multiples Excluding Tax Attributes and Tax Amortization Benefit   2021E Non-GAAP Adj. EBITDA  $114,629  5.6x  6.1x  6.7x  2022P Non-GAAP Adj. EBITDA  101,129  6.4x  6.9x  7.6x  2023P Non-GAAP Adj. EBITDA  109,836  5.9x  6.4x  7.0x  2021E Non-GAAP Total Revenue  396,711  1.63x  1.77x  1.93x  Weighted discount rate based on an approach that discounts the performance attributable to backlog at a lower rate than expected future sales  Present value of NOL tax shield  Estimated balance as of December 31, 2021  Includes accrued interest of $5.4 million  Reflects 6.1 million options outstanding. Fair value of options is based on a Black-Scholes option pricing model  Per StoneMor management. Reflects 118.3 million shares outstanding plus 533.3 thousand unvested RSUs plus 199.6 thousand director and select executive phantom units  As of January 7, 2022 per S&P Capital IQ 
 
 Selected Public Companies / M&A Transactions  Reviewed  Appendix I. 
 
 Selected Public Companies / M&A Transactions Reviewed  19  CONFIDENTIAL DRAFT  Overview  Duff & Phelps selected six (6) publicly traded companies that it deemed relevant to its analysis.  Duff & Phelps analyzed the historical and projected financial performance of each of the selected public companies. Duff & Phelps then reviewed the selected public companies’ trading multiples of enterprise value to Revenue and EBITDA.  Duff & Phelps also researched M&A transactions involving target companies with businesses that were deemed relevant to its analysis.  The Selected Public Companies analysis was not chosen as a primary methodology for StoneMor due to lack of comparability resulting from differences in business mix, as StoneMor operations are skewed much more heavily towards cemetery operations, which has revenue recognition implications, as discussed previously.  None of the selected public companies or the target companies in the M&A transactions analysis is, of course, identical to StoneMor and Duff & Phelps does not have access to non-public information regarding those companies. Accordingly, a complete financial analysis cannot be limited to a quantitative review of the selected public companies or the companies that were acquired in the M&A transactions analysis and involves complex considerations and judgments concerning differences in financial and operating characteristics of such companies and targets, as well as other factors that could affect their value relative to StoneMor. 
 
 Selected Public Companies / M&A Transactions Reviewed  Selected Public Company Overview  StoneMor Inc. Comparable Public Companies  Name Country Description Cemeteries Funeral Homes Other Business Mix  StoneMor Inc.  Owns and operates cemeteries and funeral homes in the United  United States States.  301  70  NA  Cemetery Operations segment accounted for approximately 86% of total revenue in Q4 2021  Carriage Services, Inc.  United States Provides funeral and cemetery services, and merchandise in the United  States.  32  171  NA  Funeral Home Operations segment makes up approximately 70% of total revenue  Dignity plc  United Kingdom Provides funeral services in the United Kingdom.  NA  789  46 Crematoria  Funeral Services makes up approximately 64% of total revenue with Pre-Arranged Funeral Plan sales making up less than 10% of total revenue  InvoCare Limited  Australia  Provides funeral, cemetery, crematoria, and related services in Australia, New Zealand, and Singapore.  17  278  NA  Funeral Services makes up approximately 73% of total revenue with Memorial Parks accounting for approximately 25% of total revenue  Park Lawn Corporation  Canada  Provides funeral, cremation, and cemetery services in Canada and the United States.  133  135  43 Crematoria  Company does not provide a breakdown of revenue by operating segment  Propel Funeral Partners Limited  Australia  Provides death care services in Australia and New Zealand.  9  136  32 Crematoria  Company does not provide a breakdown of revenue by operating segment  Service Corporation International  Provides deathcare products and services in the United States and  United States Canada.  485  1,453  NA  Funeral Revenue accounts for approximately 56% of total revenue with Cemetery Revenue making up the remaining balance  Source: S&P Capital IQ, Company filings, Company websites  19  CONFIDENTIAL DRAFT 
 
 Selected Public Companies / M&A Transactions Reviewed  Selected Comparable Financial Performance  Selected Public Companies Analysis  As of December 31, 2021   COMPANY INFORMATION REVENUE GROWTH EBITDA GROWTH EBITDA MARGIN   Company Name  2-YR  CAGR  2021  2022  2023  2-YR  CAGR  2021  2022  2023  3-YR  AVG  2021  2022  2023  Carriage Services, Inc.  10.9%  13.1%  3.0%  3.6%  25.9%  20.0%  4.2%  3.2%  27.2%  32.5%  32.9%  32.7%  Dignity plc  0.5  -12.8  -1.7  1.8  -5.1  -15.6  -9.3  1.2  25.8  24.2  22.3  22.2  InvoCare Limited  -0.3  8.2  8.8  4.1  -7.2  20.9  21.8  6.6  25.0  24.0  26.8  27.5  Park Lawn Corporation  45.9  10.2  14.5  5.2  35.0  51.2  16.7  7.0  19.5  26.0  26.5  26.9  Propel Funeral Partners Limited  12.5  15.6  10.9  9.9  23.5  0.1  5.4  10.5  28.1  28.2  26.9  27.0  Service Corporation International  4.9  15.8  -11.8  5.9  12.4  28.0  -24.6  11.0  28.5  34.4  29.4  30.8  Mean  12.4%  8.4%  3.9%  5.1%  14.1%  17.4%  2.4%  6.6%  25.7%  28.2%  27.5%  27.8%  Median  7.9%  11.7%  5.9%  4.7%  18.0%  20.4%  4.8%  6.8%  26.5%  27.1%  26.9%  27.2%  StoneMor (1)  4.7%  23.8%  -0.2%  4.8%  136.4%  86.4%  -11.8%  8.6%  16.5%  28.9%  25.5%  26.5%  CAGR = Compounded Annual Growth Rate  EBITDA = Earnings Before Interest, Taxes, Depreciation and Amortization  (1) Based on non-GAAP performance metrics  Source: S&P Capital IQ, SEC Filings, Annual and Interim Reports.  19  CONFIDENTIAL DRAFT 
 
 Selected Public Companies / M&A Transactions Reviewed  Selected Comparable Market Multiples  19  CONFIDENTIAL DRAFT 
 
 Selected Public Companies / M&A Transactions Reviewed  Selected M&A Transactions  Selected M&A Transactions Analysis  ($ in millions)  2021  Virginia / North Carolina (1)  4 cemeteries - currently under APA  StoneMor  $5.5  $2.3  $1.0  43.5%  2.39x  5.5x  2021  Florida (1)  1 Funeral Home - currently under LOI  StoneMor  $1.7  $0.6  $0.2  33.3%  2.83x  8.5x  2021  Tennessee / Georgia / Alabama / Mississippi (1)  15 cemeteries and 2 funeral homes - currently under LOI  StoneMor  $10.5  $5.0  $2.2  44.0%  2.10x  4.8x  2021  Mississippi (1)  2 funeral homes - currently under LOI  StoneMor  $3.2  $1.4  $0.7  50.0%  2.29x  4.6x  2021  West Virginia (1)  2 cemeteries and 2 funeral homes - currently under LOI  StoneMor  $10.9  $3.8  $1.9  50.0%  2.87x  5.7x  2020  California - Yeatman (StoneMor)(1)(2)  Owned by StoneMor  NA  $7.1  $9.5  $1.4  14.4%  0.75x  5.2x  2020  Oregon / Washington (StoneMor)(1)(2)  Owned by StoneMor  NA  $8.5  $7.7  $1.1  14.2%  1.10x  7.8x  2020  Kansas (StoneMor)(1)(2)  Owned by StoneMor  NA  $3.9  $3.6  $0.5  14.4%  1.09x  7.6x  2020  Illinois / Missouri (StoneMor)(1)(2)  Owned by StoneMor  NA  $5.5  $4.5  $0.9  20.4%  1.23x  6.0x  2019  Oakmont (StoneMor)(1)(2)  Owned by StoneMor  NA  $33.0  $8.2  $3.3  40.1%  4.02x  10.0x  2019  Evergreen (StoneMor)(1)(2)  Owned by StoneMor  NA  $0.9  $0.6  $0.1  23.6%  1.47x  6.2x  2019  Olivet (StoneMor)(1)(2)  Owned by StoneMor  NA  $25.0  $7.6  $2.4  32.3%  3.30x  10.2x  Announced  Target Name  Target Business Description  Acquirer Name  Enterprise Value  LTM  Revenue  LTM EBITDA  EBITDA  Margin  EV / Revenue  EV / EBITDA  people in Colorado.  and crematoria in Texas, Kansas, Missouri, New Mexico, and Mississippi.  Spain and Portugal.  Board  May-19 Horan & McConaty Funeral Home Horan & McConaty Funeral Home provides burial, cremation, and funeral services to Park Lawn Corporation $58.0  $18.0  NA  NA  3.23x  NA  Apr-18 The Signature Memorial Group LLC The Signature Memorial Group LLC owns and operates cemeteries, funeral homes, Park Lawn Corporation $123.0  $23.3  NA  NA  5.27x  NA  Jul-17 MEMORA Servicios Funerarios S.L. (3) MEMORA SERVICIOS FUNERARIOS SLU provides funeral services for families in Ontario Teachers' Pension Plan $458.6  $162.0  $30.4  18.8%  2.83x  15.1x  Jun-17 Saber Management, L.L.C. Saber Management, L.L.C. acquires, owns, and operates cemeteries and funeral Park Lawn Corporation $58.5  NA  $6.9  NA  NA  8.5x  homes in Kentucky, Illinois, and Texas.  (1) Transaction metrics provided by StoneMor management  (2) Metrics represent 2019 non-GAAP performance including Trusts  Mean  $50.9  $17.2  $3.8  30.7%  2.45x  7.5x  (3) Operating metrics represent FY 2016  Median  $9.5  $5.0  $1.2  32.3%  2.39x  6.9x  Source: StoneMor management, S&P Capital IQ, Merger Market, and company filings  19  CONFIDENTIAL DRAFT 
 
 Selected Take-Private Transactions Reviewed  Appendix I. 
 
 Selected Take-Private Transactions Reviewed  Take Private Transactions of Public Companies with less than $1 Billion Market Capitalization  Transactions announced, closed, or effective  Take Private Offering Price Premium To:  Date Announced  Company Name  Implied Equity  Value  Offering Price Per Share  Stock Price 1  Trading Day  Prior to Announcement  Stock Price 5  Trading Days  Prior to Announcement  Stock Price 10  Trading Days  Prior to Announcement  Length of Go- Shop Period  (Days)  11/15/2021  Casper Sleep Inc.  $308.62  $6.90  94.4%  74.2%  76.5%  NA  7/27/2020  Optiva Inc.  $244.80  $44.82  91.5%  100.6%  117.9%  NA  7/23/2021  The New Home Company Inc.  $171.11  $9.00  85.2%  85.6%  53.8%  NA  4/19/2021  Marlin Business Services Corp.  $299.06  $23.50  65.0%  72.0%  71.3%  NA  7/29/2020  IPL Plastics Inc.  $411.72  $7.48  49.1%  63.4%  76.9%  30  1/14/2021  Atlantic Power Corporation  $403.29  $3.03  43.6%  43.6%  45.0%  NA  6/7/2019  Barnes & Noble, Inc.  $490.43  $6.50  41.6%  50.8%  33.2%  NA  7/13/2020  Benefytt Technologies, Inc.  $420.60  $31.00  38.6%  56.8%  57.7%  NA  12/14/2020  People Corporation  $862.01  $11.90  36.2%  38.6%  39.2%  NA  8/9/2021  Select Interior Concepts, Inc.  $411.33  $14.50  31.7%  27.4%  41.6%  NA  11/15/2020  Foundation Building Materials, Inc.  $846.47  $19.25  27.0%  34.7%  21.1%  30  7/26/2019  Monotype Imaging Holdings Inc.  $824.41  $19.85  22.8%  18.6%  14.8%  30  3/1/2021  Boingo Wireless, Inc.  $653.31  $14.00  22.8%  10.0%  11.5%  25 (business days)  10/2/2020  Telenav, Inc.  $237.12  $4.80  20.9%  20.0%  19.1%  30  4/16/2019  Smart & Final Stores, Inc.  $514.33  $6.50  20.6%  22.2%  28.7%  NA  6/24/2019  Del Frisco's Restaurant Group, Inc.  $280.21  $8.00  18.9%  21.2%  22.9%  NA  7/12/2021  Verso Corporation  $610.59  $20.00  15.9%  15.3%  16.1%  NA  12/7/2020  SEACOR Holdings Inc.  $860.22  $41.50  14.4%  24.9%  17.4%  NA  Highest Premium  94.4%  100.6%  117.9%  Mean Premium  41.1%  43.3%  42.5%  Median Premium  34.0%  36.6%  36.2%  Lowest Premium  14.4%  10.0%  11.5%  Source: S&P Capital IQ, Bloomberg, company filings  25  CONFIDENTIAL DRAFT 
 
 Selected Take-Private Transactions Reviewed  Date Announced  Company Name  Length of Go-Shop Period  (Days)  12/7/2021  Mimecast Limited  30  7/26/2021  Medallia, Inc.  40  7/9/2021  Stamps.com Inc.  40  6/1/2021  Cloudera, Inc.  30  5/6/2021  At Home Group Inc.  40  4/26/2021  Proofpoint, Inc.  45  4/8/2021  ORBCOMM Inc.  30  3/10/2021  Talend S.A.  30  3/3/2021  The Michaels Companies, Inc.  25  3/1/2021  Boingo Wireless, Inc.  25 (business days)  12/21/2020  RealPage, Inc.  45  10/2/2020  Telenav, Inc.  30  7/29/2020  IPL Plastics Inc.  30  2/6/2020  Forescout Technologies, Inc.  30  12/17/2019  LogMeIn, Inc.  45  12/4/2019  Instructure Holdings, Inc.  35  11/15/2020  Foundation Building Materials, Inc.  30  11/13/2019  Tiger Parent (AP) Corporation  28  11/4/2019  Pattern Energy Group Inc.  35  8/14/2019  Presidio, Inc.  40  8/7/2019  Cambrex Corporation  45  7/26/2019  Monotype Imaging Holdings Inc.  30  4/15/2019  Electronics for Imaging, Inc.  45  2/12/2019  ICE Mortgage Technology, Inc.  35  Mean Go-Shop Period (Days)  35  Median Go-Shop Period (Days)  35  Take Private Transactions of Public Companies with Go-Shop Provisions  Transactions announced, closed, or effective  Source: S&P Capital IQ, company filings  25  CONFIDENTIAL DRAFT 
 
Exhibit (c)(3)