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AMERICAN FUNERAL SERVICES ADOPTS SHAREHOLDER RIGHTS PLAN

 AMERICAN FUNERAL SERVICES ADOPTS SHAREHOLDER RIGHTS PLAN
 HOUSTON, Aug. 13 /PRNewswire/ -- The board of directors of American Funeral Service Corporation (NASDAQ: AMFS) today announced it has adopted a shareholder rights plan.
 The plan is designed to enable the board to develop and preserve long-term values for stockholders and to protect stockholders against any attempt to acquire control of the company through certain coercive or unfair tactics or without an offer of fair value to all the stockholers. The company believes this rights plan is in the best interests of shareholders because it encourages any potential acquirer to make any acquisition proposal to the company's board of directors. There have been no specific acquisition offers made to the company to date.
 Under the plan each stockholder of record at the close of business on Aug. 28, 1992, will receive as a dividend one right for each share of common stock held. The rights expire on Aug. 12, 2002.
 Each right entitles the holder to purchase from the company a one one-hundredth interest in a share of a new series of preferred stock at an
exercise price of $50. The rights will become exercisable, and will detach from the common stock, only in the event a person or group acquires 25 percent or more of the company' common stock, or commences a tender or exchange offer that, if consummated would result in that person or group owning at least 25 percent of the common stock.
 If a person or group acquires a 25-percent or more position in the company, each right (except those held by the acquiring person) will then entitle its holder to purchase, for the $50 exercise price, the number of shares of company common stock having twice the value of the exercise price.
 Also, if following the rights becoming exercisable, the company is acquired in a merger or other business-combination transaction, or sells more than 50 percent of its assets or earning power to any person, each right will entitle its holder to purchase for the $50 exercise price the number of shares of common stock of the acquiring company having twice the value of the exercise price.
 The company may redeem the rights at $.01 per right at any time on or prior to the tenth business day following the acquisition of 25 percent or more of its common stock or commencement of a tender offer for such 25 percent ownership.
 Details of the shareholder rights plan are outlined in a letter that will be mailed to all stockholders.
 American Funeral Services Corporation owns and operated 10 funeral homes and 10 cemeteries in the South and Southwest.
 -0- 8/13/92
 /CONTACT: Hugh Morrison, chief executive officer, or Ross Stewart, chief financial officer of American Funeral Services, 713-524-8881/
 (AMFS) CO: American Funeral Services Corporation ST: Texas IN: SU: SRP


AH-SM -- NY071 -- 9826 08/13/92 23:04 EDT
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Publication:PR Newswire
Date:Aug 13, 1992
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