UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): August 11, 2011
Carriage Services, Inc.
(Exact name of registrant as specified in its charter)
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| Delaware
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1-11961
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76-0423828 |
(State or other jurisdiction of
incorporation or organization)
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(Commission File Number)
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(I.R.S. Employer
Identification Number) |
3040 Post Oak Boulevard, Suite 300
Houston, Texas 77056
(Address of principal executive offices, including zip code)
(713) 332-8400
(Registrant’s telephone number, including area code)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the
filing obligation of the registrant under any of the following provisions (see General Instruction
A.2. below):
o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
TABLE OF CONTENTS
Item 1.01 Entry into a Material Definitive Agreement
As previously disclosed, Carriage Services, Inc. (the “Company”) had a $40 million senior
secured revolving credit facility that matures in November 2012 and was collateralized by all
personal property and funeral home real property in certain states. The credit facility also
contained an accordion provision to borrow up to an additional $20 million. Borrowings under the
credit facility bear interest at either prime or LIBOR options. Bank of America, N.A. has served
as Administrative Agent and lead lender under this credit facility.
On August 11, 2011, the Company completed a transaction to replace the Bank of America credit
facility with a new $60 million secured bank credit facility (the “Credit Agreement”) with Wells
Fargo Bank, N.A. (“Wells Fargo”) as the Administrative Agent and Sole Lender. The new Credit
Agreement also contains an accordion provision to borrow up to an additional $15 million. The
Credit Agreement is set to mature in October 2014, and under certain conditions may be extended to
October 2016. Interest under the new Credit Agreement is payable at prime or LIBOR options. The
Credit Agreement is collateralized by the accounts receivable and all personal property of the
Company.
The Credit Agreement also provides for optional and mandatory prepayments and affirmative and
negative covenants. Principal financial covenants include a requirement to maintain a ratio of
Senior Debt to EBITDA of no more than 4.25 to 1, and a covenant to maintain a fixed charge coverage
ratio of no less than 1.25 to 1, with each ratio being measured on a rolling four-quarter basis.
The Company is also obligated to maintain shareholder equity of no less than $110 million, plus 25%
of the positive Net Income subsequent to the Effective Date. Additionally, bank consent is
required for acquisitions where the aggregate consideration paid by the Company exceeds $15
million.
Carriage will record a pretax charge in the third quarter of 2011 in connection with the
extinguishment of the existing credit facility in the amount of $0.2 million, which represents the
unamortized loan origination costs.
In addition to historical information, this Current Report contains forward-looking statements
within the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, as
amended. These forward-looking statements include any projections of cash balances and cash flows,
expenses, debt levels or other financial items; any statements of the plans, strategies and
objectives of management for future operations, including the ability to negotiate a future credit
facility; any statements regarding future economic conditions or performance; any statements of
belief; and any statements of assumptions underlying any of the foregoing. Forward-looking
statements may include the words “may”, “will”, “estimate”, “intend”, “believe”, “expect”,
“project”, “forecast”, “plan”, anticipate” and any other similar words.
The foregoing description is a summary of the material terms of the Credit Agreement and is
not complete and is qualified in its entirety by reference to the full text of the Credit
Agreement, a copy of which is filed as Exhibit 10.1 to this Current Report on Form 8-K and is
incorporated herein by reference.
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet
Arrangement of a Registrant.
The description of the Credit Agreement set forth above under Item 1.01 above is incorporated
by reference into this Item 2.03. There were no borrowings outstanding under the Company’s prior
credit facility at the time it was terminated, and there are no borrowings outstanding on the date
of this filing. The Company currently has $54.4 million of borrowing capacity available under the
new Credit Agreement.
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