The Company cautions readers that the following important factors, among others, in some cases have affected, and in the future could affect, the Company’s actual consolidated results and could cause the Company’s actual consolidated results in the future to differ materially from the goals and expectations expressed in the forward-looking statements above and in any other forward-looking statements made by or on behalf of the Company.

(1) The Company’s ability to achieve its revenue goals and the corresponding cash flows from operations are affected by the volume, mix and prices of the properties, products and services sold. The annual sales targets set by the Company are aggressive, and the inability of the Company to achieve planned levels of volume, mix or prices could cause the Company not to meet anticipated revenue goals. The ability of the Company to achieve planned volume, mix or price levels at any location depends on numerous factors, including the local economy, the local death rate, cremation rates, competition and consumer preferences. Furthermore, the Company may experience pricing pressures from low-cost funeral service and merchandise providers, which could result in reduced volume or having to reduce funeral service and merchandise prices in order to recapture market share where appropriate.

(2) Preneed cemetery sales are a significant component of the Company’s cemetery revenue. The Company sets very aggressive preneed sales targets. The inability of the Company to achieve the planned level of sales could cause a shortfall in anticipated levels of revenue and net income. Changes in the sales organization, compensation thereof and sales terms and conditions of the Company’s preneed contracts could affect the Company’s ability to achieve its preneed sales targets.

(3) Morale is a key ingredient in any sales organization, and morale can be adversely affected by numerous factors, including aggressive sales targets that make it difficult for the Company’s approximately 2,000 commissioned sales counselors to achieve their goals.

(4) When acquiring businesses, the Company set pro forma levels at which it expected those businesses to perform based on the mix of traditional services and cremation services the businesses had historically delivered and how the Company expected each business to perform over the following 12 months. As the Company typically charges a higher price for a traditional service than a cremation service, material changes in the types of services delivered from those assumed in the pro forma could affect the level of anticipated revenue generated by those businesses. Additionally, although a cremation service can yield a higher margin than a traditional service, it generally produces lower revenue and a lower total gross profit.

(5) The ability of the Company to increase or sustain current price levels and retain market share is affected by local competition in the Company’s markets, including competition from low-cost funeral providers and casket stores, as well as consumer preferences.

(6) Another important component of revenue is earnings from the Company’s cemetery trust funds and escrow accounts, which are determined by the size of, and returns (which include dividends, interest and realized capital gains) on, the funds. The returns on the Company’s prearranged funeral trust funds and escrow accounts affect the Company’s future revenue. The performance of the funds depends primarily on market conditions that are not within the Company’s control. Additionally, the performance of the funds is affected by the mix of fixed-income and equity securities. The size of the funds depends on the level of sales, funds added through acquisitions, if any, funds removed from the trust as preneed contracts turn at-need and the amount of returns that are reinvested.

(7) Future revenue is also affected by the level of prearranged sales in prior periods. The level of prearranged sales may be adversely affected by numerous factors, including deterioration in the economy, which causes individuals to have less discretionary income.

(8) The death care business is a high fixed-cost business. Positive or negative changes in revenue can have a disproportionately large effect on net earnings.

(9) In order to address its long-term debt maturities over the next three to four fiscal years, the Company is considering selling some or all of its foreign operations. Given the current market environment, no assurance can be given that foreign assets can be sold. It is likely that sales of operations in certain markets will be at prices below the carrying values of those assets and could result in a material charge to earnings but could generate significant cash for debt reduction. Sales of some or all foreign operations could result in a material reduction in revenue and, to a lesser extent, net earnings.

(10) The Company’s planned cash flow initiatives for 2001 include analysis and possible sale or re-deployment of excess cemetery property, under-performing assets and real estate that would be more valuable if converted to another use. No assurance can be given, however, that any significant portion of the Company’s assets can be sold, re-deployed or converted on a profitable basis or that doing so will not result in a material charge to earnings.

(11) The Company first entered foreign markets in the fourth quarter of fiscal year 1994, and no assurance can be given that the Company will continue to be successful in operating in foreign markets or that any operations in foreign markets will yield results comparable to those realized through the Company’s expansion in the United States.

(12) Historically, in order to support its rapid growth, the Company has periodically accessed capital markets including the secondary equity and debt markets, and the Company may need to continue to do so in order to support future growth or to meet existing operating and debt service requirements even in the absence of significant future growth. The Company’s ability to access these capital markets successfully in the future will depend on numerous factors, including the Company’s financial performance, stock market performance, changes in interest rates, any changes in the Company’s credit ratings and perceptions in the capital markets regarding the death care industry, the Company’s performance and future prospects. Additionally, any amendments, renegotiations or extensions of existing debt agreements are likely to result in higher interest costs to the Company.

(13) The Company and other industry participants continue to discuss directly with the staff of the SEC the application of its recently issued SAB 101 as it relates to prearranged sales activities. A discussion of the potential implications of SAB 101 is contained under the heading “Recent Accounting Standards.”

(14) While the Company does not anticipate that a majority of consumers will make their preneed or at-need purchasing decisions over the Internet, no assurance can be given of the impact of technological changes on the Company’s business nor of the effects of market acceptance of advances in technology made by the Company or its competitors.

(15) The Company’s ability to remain in compliance with the restrictions of its debt agreements is affected by several factors, including the Company’s earnings and fixed charges. The Company’s ability to achieve projected earnings and fixed charges depends upon many uncertainties, including each of the factors discussed herein.

(16) In addition to the factors discussed above, earnings per share and cash flow from operations may be affected by other important factors, including the following:

(a) The ability of the Company to achieve projected economies of scale in markets where it has “clusters” or combined facilities.

(b) Whether recently acquired businesses perform at pro forma levels used by management in the valuation process and whether, and the rate at which, management is able to increase the profitability of these recently acquired businesses.

(c) The ability of the Company to achieve projected revenues and earnings from recently constructed businesses.

(d) The ability of the Company to manage its growth in terms of implementing internal controls and information gathering systems and retaining or attracting key personnel, among other things.

(e) The amount and rate of growth in the Company’s general and administrative expenses.

(f) Changes in interest rates and the Company’s credit ratings, which can increase or decrease the interest rates the Company pays on borrowings with variable rates of interest and the rates it will be required to pay on new fixed- or variable-rate debt.

(g) The Company’s debt-to-equity ratio, the number of shares of common stock outstanding and the portion of the Company’s debt that has fixed- or variable-interest rates.

(h) The impact on the Company’s financial statements of nonrecurring accounting charges that may result from the Company’s ongoing evaluation of its business strategies, asset valuations and organizational structures.

(i) Changes in government regulation, including tax rates and their effects on corporate structure.

(j) Changes in inflation and other general economic conditions affecting financial markets, both domestically and internationally (e.g., marketable security values as well as exchange rate fluctuations).

(k) Unanticipated legal proceedings and unanticipated outcomes of legal proceedings.

(l) Changes in accounting policies and practices adopted voluntarily or required to be adopted by accounting principles generally accepted in the United States of America.

(m) The effects and timing of possible asset sales.

The Company also cautions readers that it assumes no obligation to update or publicly release any revisions to forward-looking statements made herein or any other forward-looking statements made by or on behalf of the Company.