AMENDED AND RESTATED OPTION AGREEMENT - PFMG

Exhibit 6.1

Execution Version

AMENDED AND RESTATED OPTION AGREEMENT - PFMG

This Amended and Restated Option Agreement (this “Agreement”) is effective as of September 24, 2015 (the “Effective Date”) and entered into between PREMIER FUNERAL MANAGEMENT GROUP, LLC, a Delaware limited liability company (“PFMG”), Xxxx Xxxxxxxx and Xxxxx Xxxxxxx (collectively, the “Granting Members”), all option and warrant holders of PFMG listed on Exhibit A attached hereto (“Option Holders”) and PF MANAGEMENT SERVICES, LLC, a Delaware limited liability company (“PFMS”). This Agreement amends and restates in its entirety that certain Option Agreement between the parties hereto, dated as of November 13, 2013.

RECITALS

A. The Granting Members and Xxxxxxx Xxxxxxxxx (“Xxxxxxxxx”) entered into that certain Limited Liability Company Agreement dated June 10, 2011, as amended and restated by that certain Amended and Restated Limited Liability Company Agreement dated as of November 13, 2013, as further amended and restated by that certain Second Amended and Restated Limited Liability Company Agreement dated as of the date hereof (as further amended from time to time, the “Operating Agreement”).

B. Each of the Option Holders is the owner of options or warrants to purchase equity interests in PFMG.

X. Xxxxxxxxx owns one percent (1%) of the outstanding membership interests of PFMG, is not granting PFMS an option to purchase his one percent (1%) interest, and has acknowledged and consented to (i) the execution of this Agreement by PFMG, the Granting Members, and the Option Holders, (ii) any transfer, sale, or assignment of the Membership Interests, including the Membership Interests of the Granting Members and any equity interests in PFMG that may be issued to an Option Holder, made in connection with this Agreement and (iii) the admittance of any transferee, purchaser, or assignee of the Membership Interests as a new member of PFMG following a transaction described in subparagraph (ii) above.

D. In consideration of (i) the agreement of LB Merchant PFMG, LLC, a Florida limited liability company (“LB-1”), to exchange the Senior Subordinated Convertible Note in the original principal amount of $2,500,000, dated November 13, 2013, issued by PFMS to LB-1 (the “Note”) and all accrued and unpaid interest under the Note for Series A Convertible Preferred Membership Units of PFMS (“Series A Preferred Units”) pursuant to that certain Exchange Agreement dated as of the date hereof between LB-1 and PFMS (the “Exchange Agreement”); and (ii) the agreement of LB Merchant PFMG-2, LLC, a Florida limited liability company (“LB-2” and, collectively with LB-1, the “Investors”), to purchase Series A Preferred Units pursuant to that certain Securities Purchase Agreement between LB-2 and PFMS dated as of the date hereof (the “SPA”), PFMG, the Granting Members, and the Option Holders desire to grant an option to PFMS for the purchase of ninety nine percent (99%) of the membership interests of PFMG now or hereafter issued and outstanding (the “Membership Interests”).

AGREEMENT

PFMG, the Granting Members, the Option Holders and PFMS agree as follows:

1. Recitals and Definitions. The recitals above are true and correct and incorporated in this Agreement by reference. Any capitalized term used and not defined in this Agreement shall have the definition for such term listed in the Operating Agreement.

2. Grant of Option. The Granting Members hereby grant to PFMS an exclusive right and option to purchase all of their Membership Interests (the “Option”) subject to the terms and conditions of this Agreement and the Option Holders consent to the grant of the Option. Each Option Holder acknowledges and agrees that if an Option Holder exercises the Option Holder’s warrants or options to purchase equity interests in PFMG before PFMS exercises the Option, then (a) PFMS’s Option shall automatically include the right and option to purchase the equity interests in PFMG issued to the Option Holder without any further agreement between the parties to this Agreement or amendment of this Agreement, and (b) all of the terms and conditions of this Agreement applicable to the Granting Members shall apply to the Option Holder who was issued equity interests in PFMG. Notwithstanding any other provision of this Agreement or applicable law to the contrary, as long as the Investors own any Series A Preferred Units or Common Units of PFMS, this Agreement may only be terminated with the prior written consent of the Investors.

3. Cancellation of Existing Options and Warrants. Option Holders hereby agree that upon exercise of the Option pursuant to the terms of this Agreement, that all outstanding warrants and options to purchase equity interests in PFMG shall be cancelled with no consideration.

4. Exercise of the Option. PFMS may exercise the Option upon or at any time after (a) the earlier of (i) all of the outstanding principal and accrued and unpaid interest due under PFMG’s Small Business Administration loans (the “SBA Loans”) have been paid, or (ii) consent of the lender(s) for the SBA Loans to the transfer of the Membership Interests to PFMS, and (b) any approvals required to be obtained from any federal or state regulatory body or other governmental authority have been obtained, by providing written notice of such election to PFMG and the Granting Members (the “Election Notice”). Nothing in this Agreement shall be construed to require PFMS to exercise the Option, and PFMG, the Granting Members, and the Option Holders acknowledge and agree that the Option may be exercised by PFMS in PFMS’s sole and absolute discretion. If PFMS exercises the Option, the closing on the purchase of the Membership Interests shall occur on or before five (5) business days after the Election Notice is received by PFMG or such other date that PFMS and PFMG may designate (the “Closing Date”). On the Closing Date, PFMS, PFMG, and the Granting Members shall execute an Assignment, Assumption, and Admission Agreement that, among other things, transfers the Membership Interests to PFMS and admits PFMS as the only member of PFMG other than Xxxxxxxxx.

5. Exercise Payment. If PFMS exercises the Option, PFMS shall pay an amount in cash on or before the Closing Date to each Member equal to the amount distributable to each Member under Section 5.5 of the Operating Agreement for the calendar year in which PFMS exercises the Option (for each Member, the “Unpaid Tax Liability Amount”). PFMS shall not be required to pay any amount to PFMG, the Granting Members, or the Option Holders in connection with PFMS’s exercise of the Option other than the Unpaid Tax Liability Amounts that may be due to the Granting Members.

2

6. Assignment of Rights to Dividends and Distributions. Each Granting Member hereby assigns to PFMS all of such Member’s right, title, and interest in and to any dividends or distributions from PFMG (other than distributions to pay income taxes on income of PFMG allocated to the Member) (the “Assigned Dividends and Distributions”); provided, however, that this assignment shall not be construed to permit the Assigned Dividends and Distributions that are expressly prohibited by the Operating Agreement without the Investors’ prior written approval. If any such Assigned Dividends and Distributions are made by PFMG to the Granting Members either with or without the prior written approval of the Investors, the Granting Members shall hold the full amount of such Assigned Dividends and Distributions in trust for the sole benefit of PFMS and shall promptly transfer the full amount of the Assigned Dividends and Distributions to PFMS upon PFMS’s or the Investors’ request.

7. Representations and Warranties; Covenants. Each party hereby represents and warrants to the other that it has the full and complete authority to enter into this Agreement. PFMS, PFMG, the Granting Members, and the Option Holders agree to execute such other commercially reasonable documentation necessary to effectuate this Agreement and transfer the Membership Interests if the Option is exercised. PFMG and the Granting Members represent that no Person (other than PFMS and the Option Holders listed on Exhibit A) has a right or option to purchase the Membership Interests or any part thereof and covenant not to grant any such right or option. The Membership Interests are lawfully and beneficially owned of record by the Granting Members and are, and shall be on the Closing Date, validly issued, fully paid and non-assessable, and free and clear of all liens, claims, charges, restrictions, equities, and encumbrances and any other third party rights, with all transfer and other taxes paid. The Granting Members and the Option Holders covenant and agree not to transfer, sell, or convey the Membership Interests or any other equity interest in PFMG to any Person without the prior written approval of the Investors; provided, however, that a transfer of Membership Interests pursuant to Section 6.5 of the Operating Agreement shall be permitted as long as: (a) the Granting Member transferring the Membership Interest provides prior written notice of the transfer to Investors, and (b) the transferee executes a joinder to this Agreement agreeing to be bound by the terms and conditions of this Agreement, assuming the transferring Granting Member’s duties and obligations under this Agreement with respect to the transferred Membership Interest, and confirming that PFMS’s Option includes the right and option to purchase all of the transferred Membership Interests.

8. Legends. Any certificate existing or hereafter issued evidencing the Membership Interests shall bear the following legend (in addition to any other legend required by the Operating Agreement): “This certificate evidences a membership interest in Premier Funeral Management Group, LLC, and is subject to that certain Amended and Restated Option Agreement dated September 24, 2015, executed in favor of PF Management Services, LLC.”

3

9. Assignment. PFMS shall not assign this Agreement or any of PFMS’s rights under this Agreement, including, but not limited to, the Option, to any Person or to name ominees to take title to the Membership Interests without the prior written consent of the Investors.

10. Successors and Assigns. This Agreement shall be binding upon the parties hereto and their respective heirs, personal representatives, successors, and permitted assigns.

11. Time of the Essence. All times and dates for performance set forth in this Agreement are agreed to be of the essence.

12. Consent to Transfer. The Granting Members, the Option Holders, and PFMG hereby affirmatively approve (i) any transfer, sale, or assignment of the Membership Interests, including the Membership Interests of the Granting Members and any equity interests in PFMG that may be issued to an Option Holder, made in connection with this Agreement and agree that any such transfer, sale, or assignment shall be deemed to be in compliance with the terms and conditions of the Operating Agreement and (ii) the cancellation of all outstanding options and warrants held by the Option Holders upon exercise of the Option.

13. Governing Law. This Agreement shall be construed in accordance with the laws of the state specified in Section 10.6 of the Operating Agreement.

14. Construction. If there is a conflict between this Agreement and the Operating Agreement, then the terms and conditions of this Agreement shall prevail.

15. Amendments. This Agreement may not be modified except in a writing signed by all parties hereto.

16. Third Party Beneficiaries. This Agreement is intended to benefit the Investors, and the Investors are consequently third party beneficiaries of the rights and benefits granted to PFMS pursuant to this Agreement.

17. Counterparts. This Agreement may be executed in two or more counterparts, all of which when taken together shall be considered one and the same agreement and shall become effective when counterparts have been signed by each party and delivered to the other party, it being understood that both parties need not sign the same counterpart. In the event that any signature is delivered by fax or e-mail, such signature shall create a valid and binding obligation of the party executing (or on whose behalf such signature is executed) with the same force and effect as if such faxed or e-mailed signature page were an original.

[Remainder of Page Left Blank – Signatures Follow]

4

This Agreement has been executed by PFMS, the Granting Members, the Option Holders and PFMG as of the Effective Date.

	PFMS:
	PF MANAGEMENT SERVICES, LLC, a Delaware limited liability company
	By:	/s/ Xxxxx Xxxxxxx
	Name:	Xxxxx Xxxxxxx
	Title:	Chief Executive Officer
	PFMG:
	PREMIER FUNERAL MANAGEMENT GROUP, LLC, a Delaware limited liability company
	By:	/s/ Xxxxx Xxxxxxx
	Name:	Xxxxx Xxxxxxx
	Title:	Chief Executive Officer
	GRANTING MEMBERS:
	/s/ XXXX XXXXXXXX
	XXXX XXXXXXXX
	/s/ XXXXX XXXXXXX
	XXXXX XXXXXXX

[Signature Page to A&R Option Agreement for Membership Interests of PFMG]

	OPTION HOLDERS:
	GROWTHINK, INC.
	By:	/s/ Xxxxx Xxxx
	Name:	Xxxxx Xxxx
	Title:	CEO
	/s/ XXXX XXXXX
	XXXX XXXXX

[Signature Page to A&R Option Agreement for Membership Interests of PFMG]

EXHIBIT A

LIST OF OPTION HOLDERS

Option Holders and Warrant Holders:

GROWTHINK, INC.

XXXX XXXXX