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EXHIBIT 10.1
CONSENT AND AMENDMENT
DATED AS OF NOVEMBER 17, 2000
This CONSENT AND AMENDMENT (this "Agreement") is among CORRECTIONS
CORPORATION OF AMERICA (formerly known as Prison Realty Trust, Inc.), a Maryland
corporation (the "Borrower"), the subsidiaries of the Borrower party to the
Credit Agreement referred to below (collectively, the "Subsidiary Guarantors"),
the Lenders (as defined below), and XXXXXX COMMERCIAL PAPER INC. ("LCPI"), as
administrative agent for the Lenders (in such capacity, the "Administrative
Agent").
PRELIMINARY STATEMENTS:
1. The Borrower, the Subsidiary Guarantors, the Lenders, and the
Administrative Agent have entered into that certain Amended and Restated Credit
Agreement, dated as of August 4, 1999, by and among the Borrower, the Subsidiary
Guarantors, the lenders party thereto (the "Lenders"), the Administrative Agent,
Societe Generale, as documentation agent, Xxxxxx Brothers Inc., as advisor, book
manager and lead arranger, The Bank of Nova Scotia, as syndication agent, and
Southtrust Bank (formerly known as Southtrust Bank, N.A.), as co-agent (as
amended by that certain Waiver and Amendment, dated as of June 9, 2000, the
"Credit Agreement"; capitalized terms used and not otherwise defined herein have
the meanings assigned to such terms in the Credit Agreement).
2. The Borrower has informed the Lenders that it wishes to engage in
certain CCA Entity Transactions that require the consent of the Required Lenders
and the Required Tranche C Term Lenders, including, without limitation, the
Service Company Agreements, as defined below (collectively, the "Transactions").
3. The Borrower has requested that the Required Lenders and the Required
Tranche C Term Lenders (i) consent to the Transactions and (ii) agree to certain
amendments to the Credit Agreement, as more particularly described below.
4. Subject to the terms and conditions set forth below, and in
consideration of certain agreements of the Borrower and the other Credit Parties
set forth herein, the Required Lenders and the Required Tranche C Term Lenders
are willing to agree to the consents and amendments described below.
NOW, THEREFORE, in consideration of the premises and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
1. Defined Terms. For purposes of this Agreement, the following terms shall
have the meanings set forth below:
a. "Amendment Effective Date" means the date on which all of the
conditions precedent to the effectiveness of this Agreement have been satisfied.
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b. "Service Company A Amendment" means the amendment, to be effective as
of September 29, 2000, of that certain Administrative Services Agreement by and
between Service Company A and Management Sub, dated as of January 1, 1999,
whereby the parties thereto will agree: (i) to increase, as of January 1, 2000,
the administrative services fee paid by Service Company A to Management Sub from
$260,000 per month to $450,000 per month; and (ii) to include, as of January 1,
2000, a monthly payment to Management Sub by Service Company A for the use of
the name "Corrections Corporation of America" in an amount equal to 2.0% of
Service Company A's monthly management revenues, all in form and substance
satisfactory to the Administrative Agent.
c. "Service Company Agreements" means the Service Company A Amendment,
the Service Company B Amendment, the Service Company A Settlement Agreement, and
the Service Company B Settlement Agreement.
d. "Service Company B Amendment" means the amendment, to be effective as
of September 29, 2000, of that certain Administrative Services Agreement by and
between Service Company B and Management Sub, dated as of January 1, 1999,
whereby the parties thereto will agree: (i) to increase, as of January 1, 2000,
the administrative services fee paid by Service Company B to Management Sub from
$260,000 per month to $450,000 per month; and (ii) to include, as of January 1,
2000, a monthly payment to Management Sub by Service Company B for the use of
the name "Corrections Corporation of America" in an amount equal to 2.0% of
Service Company B's monthly management revenues, all in form and substance
satisfactory to the Administrative Agent.
e. "Service Company A Settlement Agreement" means that certain
settlement agreement between the Borrower and Service Company A, dated as of
September 29, 2000, whereby Service Company A agrees to pay the Borrower
$6,000,000 in exchange for a full indemnity by the Borrower for any and all
liabilities incurred by Service Company A in connection with the settlement or
disposition of a litigation known as Prison Acquisition Company, LLC vs. Prison
Realty Trust, Inc., et. al., in form and substance satisfactory to the
Administrative Agent.
f. "Service Company B Settlement Agreement" means that certain
settlement agreement between the Borrower and Service Company B, dated as of
September 29, 2000, whereby Service Company B agrees to pay the Borrower
$6,000,000 in exchange for a full indemnity by the Borrower for any and all
liabilities incurred by Service Company B in connection with the settlement or
disposition of a litigation known as Prison Acquisition Company, LLC vs. Prison
Realty Trust, Inc., et. al., in form and substance satisfactory to the
Administrative Agent.
2. Consents. Upon the terms and subject to the conditions set forth in this
Agreement and in reliance on the representations and warranties of the Credit
Parties set forth in this Agreement, the Required Lenders and Required Tranche C
Term Lenders hereby consent to the following transactions:
a. the Service Company A Amendment;
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b. the Service Company B Amendment;
c. the Service Company A Settlement Agreement; and
d. the Service Company B Settlement Agreement.
3. Amendments to Credit Agreement. Upon the terms and subject to the
conditions set forth in this Agreement and in reliance on the representations
and warranties of the Credit Parties set forth in this Agreement, the Borrower,
the Required Lenders and the Required Tranche C Term Lenders hereby agree to the
following amendments to the Credit Agreement:
a. The Credit Agreement is hereby amended by deleting each reference to
the term "Rights Offering" therein, including without limitation, in Sections
3.3(b)(ii), 6.15, 7.22, 8.18 and 9.1(v), and replacing each such reference with
the term "Capital Raising Event".
b. Schedule 6.15 to the Credit Agreement is hereby deleted in its
entirety and replaced with the revised Schedule 6.15 attached hereto as
Exhibit A.
c. Section 1.1 of the Credit Agreement is hereby amended by adding the
following definitions in proper alphabetical order:
1. ""Capital Raising Event" means any combination of the following
transactions, which together result in Net Cash Proceeds to the Borrower of
at least $100,000,000: (i) an offering made by the Borrower to its
then-current common shareholders through the distribution of rights to
purchase shares of common stock of the Borrower (based on each
shareholder's then-current pro rata share of the Borrower's common stock);
(ii) an offering by the Borrower of common or preferred stock (other than
Disqualified Stock); (iii) an issuance of Subordinated PIK Debt (provided
that, anything else in this Agreement to the contrary notwithstanding
(including, without limitation, Sections 3.3(b)(ii), 7.22 and 8.18), the
Net Cash Proceeds of any issuance of Subordinated PIK debt shall be
immediately applied to repay the Loans in the order and in accordance with
the procedures set forth in Section 3.3(b)(iii)); or (iv) certain sales of
assets of the Borrower including, without limitation, the Headquarters
Sale-Leaseback, but excluding the Agecroft Securitization, in each case in
form and substance satisfactory to the Administrative Agent (provided that,
anything else in this Agreement to the contrary notwithstanding (including,
without limitation, Sections 3.3(b)(ii), 7.22 and 8.18), the Net Cash
Proceeds of any such asset sales shall be immediately applied to repay the
Loans in the order and in accordance with the procedures set forth in
Section 3.3(b)(iii)); provided that, in the case of each of (i) - (iv)
above, (x) each such transaction shall be consummated in accordance with
all applicable federal and state laws, and (y) the proceeds of each such
transaction shall be applied in accordance with the terms and conditions of
this Agreement (including, without limitation, as set forth above in this
definition."
2. ""Consent and Amendment" means that certain Consent and Amendment,
dated as of November 17, 2000, among the Borrower, certain of the
Borrower's subsidiaries, the Lenders, and the Administrative Agent."
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3. ""Restructuring Charges" means (i) non-recurring charges or
extraordinary items applied in accordance with SAB No. 100, EITF 94-3, FAS
No. 121, or APB No. 120, as applicable; (ii) severance package payments
accrued through and including March 31, 2001; and (iii) fees paid to
management consultants, financial consultants and other professionals
(including legal fees), provided that such fees shall be limited to
$1,600,000, in the aggregate, for the fiscal quarter ending December 31,
2000, and $1,500,000, in the aggregate, for each fiscal quarter thereafter,
in each case only to the extent that such fees, extraordinary items, non
recurring charges, and severance package payments are directly related to
the restructuring of the corporate and capital structure of the
Consolidated Parties."
4. ""Subordinated PIK Debt" means unsecured, subordinated,
non-guaranteed Indebtedness of the Borrower containing terms and conditions
reasonably satisfactory to the Administrative Agent, provided that, in any
event, (i) such Indebtedness shall be subordinated in right of payment to
the Loans hereunder in a manner satisfactory to the Administrative Agent,
(ii) such Indebtedness shall have a maturity date at least one year later
than the final maturity of the Senior Notes, and (iii) payments of
principal and interest under such Indebtedness shall be made only in kind
and not in cash or any other assets of the Borrower or any other Credit
Party, provided that the terms of such Subordinated PIK Debt may provide
for the payment of principal and interest in cash upon the repayment in
full in case of all amounts outstanding under this Agreement and the other
Credit Documents in accordance with the terms hereof and thereof."
d. Section 1.1 is hereby further amended as follows:
1. The definition of "Management Sub" is hereby amended by adding the
phrase "CCA of Tennessee, Inc., a Tennessee corporation and" immediately
preceding the words "the wholly-owned" in the first line thereof.
2. The definition of "LTM Post Merger EBITDA" is hereby amended by
deleting the phrase "Section 7.11(b)" and replacing it with the phrase
"Section 7.11(i)" in the second line thereof.
3. The definition of "Post Merger EBITDA" is hereby amended by adding
the phrase "and (v) Restructuring Charges for such period, to the extent
permitted by GAAP," immediately preceding the words "in each case to the
extent" in the twelfth line thereof.
4. The definition of "Post Merger Interest Coverage Ratio" is hereby
amended by adding the phrase "for the twelve month period ending on such
date," immediately preceding the words "the ratio of Post Merger EBITDA" in
the second line thereof.
5. The definition of "Rights Offering" is hereby deleted in its
entirety.
6. The definition of "Service Company Mergers" is hereby amended by
adding the words "or Management Sub (with the applicable Service Company
Sub or Management Sub as the servicing entity)" immediately following the
words "applicable Service Company Subs" in the second line thereof. For the
avoidance of doubt, to the
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extent that either or both of Service Company A or Service Company B merges
with and into Management Sub, any property formerly owned by Service
Company A and/or Service Company B, as applicable, shall be excluded from
the Collateral hereunder.
7. The definition of "Total Beds Occupied Ratio" is hereby amended by
deleting the words "and managed by a Credit Party or Management Opco"
immediately following the words "owned by a Credit Party" and replacing
them with the words "Service Company A or Service Company B and managed by
a Credit Party, Management Opco, Service Company A or Service Company B" in
the fourth line thereof.
e. Section 3.3(b)(iv) of the Credit Agreement is hereby deleted in its
entirety and replaced with the following new Section 3.3(b)(iv):
"(iv) Agecroft Securitization. Notwithstanding the foregoing, the Net
Cash Proceeds received by the Borrower or any other Credit Party in
connection with the Agecroft Securitization shall be immediately applied to
the repayment of the Revolving Loans and (a) the Revolving Committed Amount
shall be simultaneously permanently reduced by fifty percent (50%) of the
aggregate amount of such Net Cash Proceeds (as contemplated in the
definition of Revolving Committed Amount) and (b) in addition to the
reduction in the Revolving Committed Amount set forth in clause (a) above,
but without resulting in a further such reduction, the Availability Reserve
then in effect shall be simultaneously increased by an amount equal to
twenty-five percent (25%) of the aggregate amount of such Net Cash Proceeds
until such time as the Aggregate Required Lenders shall otherwise agree in
writing."
f. Section 3.17 of the Credit Agreement is hereby deleted in its
entirety and replaced with the following new Section 3.17:
"3.17 ADDITIONAL CONSIDERATION.
(a) Without diminishing or otherwise affecting the provisions of
Section 3.1 or the other provisions of this Section 3.17, and in
consideration for the consents, waivers and amendments contained in
the Waiver and Amendment, all Loans under this Credit Agreement shall
bear interest at a per annum rate of 0.50% greater than the rate that
would otherwise be applicable (by way of example only, 9.00% in lieu
of 8.50%).
(b) Without diminishing or otherwise affecting the provisions of
Section 3.1 or the other provisions of this Section 3.17, and in
consideration for the consents and amendments contained in the Consent
and Amendment, commencing on July 1, 2001, all loans under this Credit
Agreement shall bear interest at a per annum rate 0.25% greater than
the rate that would otherwise be applicable (by way of example only,
9.25% in lieu of 9.00%), unless and until such time as the Borrower
shall have prepaid after the date of the Consent and Amendment
(whether voluntarily or as required by the terms and conditions of
this Credit Agreement) the Loans in an amount equal to or greater than
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$100,000,000 and applied such prepayments in accordance with Section
3.3(b)(iii), at which such time such 0.25% increase shall
automatically terminate; provided that (i) any portion of the Net Cash
Proceeds received by the Borrower or any Credit Party in connection
with the Agecroft Securitization that is applied to the permanent
reduction of the Revolving Committed Amount in accordance with Section
3.3(b)(iv)(a) shall be treated, for purposes of this Section 3.17(b)
only, as if such Net Cash Proceeds had been applied in accordance with
Section 3.3(b)(iii); and (ii) as of October 1, 2001, this Section
3.17(b) shall have no further force or effect.
(c) Without diminishing or otherwise affecting the provisions of
Section 3.1 or this Section 3.17, and in consideration for the
consents and amendments contained in the Consent and Amendment,
commencing on October 1, 2001, all Loans under this Credit Agreement
shall bear interest at a per annum rate 0.50% greater than the rate
that would otherwise be applicable (by way of example only, 9.50% in
lieu of 9.00%), unless and until such time as the Borrower shall have
prepaid after the date of the Consent and Amendment (whether
voluntarily or as required by the terms and conditions of this Credit
Agreement) the Loans in an amount equal to or greater than
$200,000,000.00, inclusive of all amounts prepaid in satisfaction of
Section 3.17(b) above, and applied such prepayments in accordance with
Section 3.3(b)(iii), at which such time such 0.50% increase shall
automatically terminate; provided that any portion of the Net Cash
Proceeds received by the Borrower or any Credit Party in connection
with the Agecroft Securitization that is applied to the permanent
reduction of the Revolving Committed Amount in accordance with Section
3.3(b)(iv)(a) shall be treated, for purposes of this Section 3.17(c)
only, as if such Net Cash Proceeds had been applied in accordance with
Section 3.3(b)(iii)."
g. Section 7.1(b)(iii) of the Credit Agreement is hereby amended by
deleting the phrase "Prior to the consummation of the Management Opco Merger,
as" in the first line thereof and replacing such phrase with the word "As".
h. Section 7.1(c) of the Credit Agreement is hereby amended as
follows:
(i) the phrase "Section 7.11(a) and (b)" starting in the fourth
line thereof is hereby deleted and replaced with the phrase
"Section 7.11";
(ii) the phrase "Sections 7.11(a)(viii) and 7.11(c)" in the
twelfth line thereof is hereby deleted and replaced with the
phrase "Section 7.11(vi)"; and
(iii) the phrase "accompanied by a report setting forth, on a
facility by facility basis, the Total Beds Occupied Ratio for
such month" is added immediately following the phrase
"Unrestricted Subsidiary, as applicable)" and immediately
preceding the period at the end thereof.
i. Section 7.11 of the Credit Agreement is hereby deleted in its
entirety and replaced with the following new Section 7.11:
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"7.11 FINANCIAL COVENANTS.
(i) Maximum Total Leverage. At all times the ratio of Total
Indebtedness to Post Merger EBITDA of the Consolidated Parties for the
immediately preceding four full fiscal quarters ("LTM Post Merger
EBITDA") shall be equal to or less than the ratio set forth below for
such fiscal quarter, provided that for any fiscal quarter after fiscal
year 2001, such ratio shall be equal to or less than 6.00:1.00. For
purposes of determining compliance with this Section 7.11 (i), during
the third quarter of 2000, LTM Post Merger EBITDA shall be
$133,700,000.
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Fiscal Quarter Ratio
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Q3 - 2000: 8.80:1.00
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Q4 - 2000: 8.15:1.00
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Q1 - 2001: 7.80:1.00
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Q2 - 2001: 7.10:1.00
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Q3 - 2001: 6.10:1.00
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Q4 - 2001: 6.00:1.00
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(ii) Post Merger Interest Coverage Ratio. The Post Merger
Interest Coverage Ratio, as of the last day of each fiscal quarter of
the Consolidated Parties, shall be equal to or greater than the ratio
set forth below for such fiscal quarter, provided that for any fiscal
quarter after fiscal year 2001, such ratio shall be equal to or
greater than 1.35:1.00. For purposes of determining compliance with
this Section 7.11(ii), (A) during the third quarter of 2000 and the
fourth quarter of 2000, all necessary calculations for the immediately
preceding twelve month period shall be determined by multiplying the
applicable component of the Post Merger Interest Coverage Ratio for
the third or fourth quarter of 2000, as applicable, by four, (B)
during the first quarter of 2001, all necessary calculations for the
immediately preceding twelve month period shall be determined by
multiplying (i) the sum of the applicable component of the Post Merger
Interest Coverage Ratio for the fourth quarter of 2000 plus such
component for the first quarter of 2001 by (ii) two, and (C) during
the second quarter of 2001, all necessary calculations for the
immediately preceding twelve month period shall be determined by
multiplying (i) the sum of the applicable component of the Post Merger
Interest Coverage Ratio for the fourth quarter of 2000 plus such
component for the first quarter of 2001 plus such component for the
second quarter of 2001 by (ii) four-thirds.
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Fiscal Quarter Ratio
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Q3 - 2000: 0.95:1.00
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Q4 - 2000: 1.25:1.00
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Q1 - 2001: 1.30:1.00
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Q2 - 2001: 1.30:1.00
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Q3 - 2001: 1.35:1.00
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Q4 - 2001: 1.35:1.00
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(iii) Fixed Charge Coverage. The Fixed Charge Coverage Ratio, as
of the last day of each fiscal quarter of the Consolidated Parties,
shall be equal to or greater than the ratio set forth below for such
fiscal quarter, provided that for any fiscal quarter after fiscal year
2001, such ratio shall be equal to or greater than 1.10:1.00. For
purposes of determining compliance with this Section 7.11(iii), (A)
during the third quarter of 2000 and the fourth quarter of 2000, all
necessary calculations for the immediately preceding twelve month
period shall be determined by multiplying the applicable component of
the Fixed Charge Coverage Ratio for the third or fourth quarter of
2000, as applicable, by four, (B) during the first quarter of 2001,
all necessary calculations for the immediately preceding twelve month
period shall be determined by multiplying (i) the sum of the
applicable component of the Fixed Charge Coverage Ratio for the fourth
quarter of 2000 plus such component for the first quarter of 2001 by
(ii) two, and (C) during the second quarter of 2001, all necessary
calculations for the immediately preceding twelve month period shall
be determined by multiplying (i) the sum of the applicable component
of the Fixed Charge Coverage Ratio for the fourth quarter of 2000 plus
such component for the first quarter of 2001 plus such component for
the second quarter of 2001 by (ii) four-thirds.
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Fiscal Quarter Ratio
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Q3 - 2000: 0.65:1.00
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Q4 - 2000: 1.05:1.00
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Q1 - 2001: 1.10:1.00
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Q2 - 2001: 1.10:1.00
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Q3 - 2001: 1.10:1.00
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Q4 - 2001: 1.10:1.00
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(iv) Total Indebtedness to Total Capitalization. At all times the
ratio of Total Indebtedness to Total Capitalization shall be equal to
or less than 0.55:1.00. For purposes of determining compliance with
this Section 7.11(iv), (A) during the third quarter of 2000, in
connection with the Change in Tax Status, the Borrower shall be
entitled to make a permanent positive adjustment to retained earnings
in an amount equal to the lesser of (x) the aggregate of any
reductions in retained earnings that are caused directly by
recognizing deferred tax liabilities and/or valuation allowances
recorded against deferred tax assets in accordance with FSAS No. 109
and (y) $200,000,000, and (B) during the fourth quarter of 2000, the
Borrower shall be entitled to make a permanent positive adjustment to
retained earnings in an amount equal to the lesser of (x) the
aggregate of any reductions in the carrying value of any assets to
fair market value and/or net realizable value and any non-cash charges
related solely to the Management Opco Merger, each as determined in
accordance with GAAP and (y) $600,000,000.
(v) Minimum Post Merger EBITDA. As of the last day of each fiscal
quarter of the Consolidated Parties, Post Merger EBITDA shall be equal
to or greater than the amount indicated below for such fiscal quarter,
provided that for any fiscal quarter after fiscal year 2001, Post
Merger EBITDA shall be equal to or greater than $44,200,000.
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Fiscal Quarter Amount
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Q3 - 2000: $33,200,000
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Q4 - 2000: $42,200,000
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Q1 - 2001: $45,600,000
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Q2 - 2001: $41,400,000
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Q3 - 2001: $44,300,000
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Q4 - 2001: $44,200,000
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Pro Forma Adjustments: The financial covenants contained in (i)
through (v) above shall be calculated as if the Management Opco Merger
had occurred on the first of day of such fiscal quarter.
(vi) Total Beds Occupied Ratio. At the end of each calendar month
the average of the Total Beds Occupied Ratios for each of the
immediately preceding three calendar months shall be equal to or
greater than the amount indicated below for such calendar month.
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Month Ratio
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June 2000 74.0%
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July 2000 75.0%
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August 2000 76.0%
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September 2000 79.0%
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October 2000 84.0%
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November 2000 85.0%
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December 2000 86.0%
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January 2001 86.0%
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February 2001 86.0%
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March 2001 87.0%
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April 2001 87.0%
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May 2001 87.0%
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June 2001 87.0%
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July 2001 88.0%
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August 2001 88.0%
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September 2001 88.0%
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October 2001 88.0%
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November 2001 88.0%
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December 2001, and thereafter 88.0%
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j. Section 7.22 of the Credit Agreement is hereby deleted in its
entirety and replaced with the following new Section 7.22:
"7.22 CAPITAL RAISING EVENT.
The Borrower will use commercially reasonable efforts to complete the
Capital Raising Event on or before June 30, 2001. Subject to the limitations set
forth in the definition of "Capital Raising Event," upon receipt of the Net Cash
proceeds of any transaction contemplated
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in clauses (i) and (ii) of the definition of "Capital Raising Event," the
Borrower will (a) immediately apply seventy-five percent (75%) of such Net Cash
Proceeds to the repayment of the Loans in accordance with Sections 3.3(b)(ii)
and (iii) and (b) immediately apply the remaining twenty-five percent (25%) of
such Net Cash Proceeds to the repayment of the Revolving Loans. Simultaneously,
the Availability Reserve then in effect shall be increased by an amount equal to
the portion of such Net Cash Proceeds applied to the repayment of the Revolving
Loans pursuant to clause (b) above until such time as the Capital Raising Event
is complete. Upon the completion of the Capital Raising Event, the Availability
Reserve shall immediately be reduced to the extent of any increases occasioned
by this Section 7.22."
k. Section 7 of the Credit Agreement is hereby further amended by
adding, immediately following Section 7.23, the following new Section 7.24:
"7.24 MANAGEMENT CONTRACT.
The Borrower will, no later than December 31, 2000, (i) enter into an
agreement with Management Sub, in form and substance satisfactory to the
Aggregate Required Lenders, pursuant to which the Borrower will (A) permit
Management Sub to manage and operate such prison facilities as are then or
thereafter owned by the Borrower and then or thereafter managed by Management
Sub or (B) lease to Management Sub such prison facilities as are then or
thereafter owned by the Borrower and then or thereafter managed by Management
Sub, in either case, in exchange for a fee to be paid from Management Sub to the
Borrower, and (ii) simultaneously therewith, pledge such agreement and the
proceeds to be received thereunder to the Administrative Agent as additional
Collateral for the Obligations, in a manner satisfactory to the Administrative
Agent."
l. Section 8.4(f) of the Credit Agreement is hereby amended by adding
the words "or Management Sub" immediately following the words "into the Service
Company Subs" and immediately preceding the words "provided that".
m. Section 8.4(f)(i) of the Credit Agreement is hereby amended by adding
the words "or Management Sub" immediately following the words "the Service
Company Subs" and immediately preceding the words "each shall be the
continuing".
n. Section 8.18 of the Credit Agreement is hereby amended by deleting
clause (ii) in its entirety and replacing it with the following new clause (ii):
"(ii) subject to the limitations set forth in the definition of "Capital Raising
Event," after completion of the Capital Raising Event, Build-to-Suit Capital
Expenditures not exceeding twenty-five percent (25%) of the Net Cash Proceeds
thereof (with the remaining seventy-five percent (75%) being applied in
accordance with Sections 3.3(b)(ii) and (iii))," in the fifth through eighth
lines thereof.
o. Section 9.1(p) of the Credit Agreement is hereby amended by deleting
the words "prior to the appointment of and commencement of duties by the New
CEO" in the first and second lines thereof.
p. Section 9.1(q) of the Credit Agreement is hereby amended by deleting
the words "November 15, 2000" in the second line thereof and replacing them with
the words "December 31, 2000".
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q. Section 9.1(t) of the Credit Agreement is hereby amended by deleting
the words "prior to the appointment of and commencement of duties by the New
CEO" in the first and second lines thereof.
r. Section 9.1(v) of the Credit Agreement is hereby amended by deleting
the words "December 31, 2000" and replacing them with the words "June 30, 2001".
s. Section 11.1 of the Credit Agreement is hereby amended by replacing
the name "Xxxxxx X. Xxxxxxx" with the name "Xxxx Xxxxxxxx" in the address block
for the Credit Parties therein.
4. Conditions to Effectiveness. The effectiveness of this Agreement is
conditioned upon satisfaction of the following conditions precedent:
a. the Administrative Agent shall have received signed written
authorization from the Required Lenders and Required Tranche C Term Lenders to
execute this Agreement, and shall have received counterparts of this Agreement
signed by the Borrower and the other Credit Parties;
b. each of the representations and warranties in Section 5 below shall
be true and correct in all material respects;
c. after giving effect to the consents set forth in Section 2 hereof, no
Default or Event of Default shall have occurred and be continuing under the
Credit Agreement or any other Credit Document;
d. in consideration of the consents and amendments contained in this
Agreement, the Borrower shall have paid to the Administrative Agent on the
Amendment Effective Date, for the pro rata account of the Lenders, a fee equal
to 0.05% of the sum of the Revolving Committed Amount, the outstanding Term
Loans and the outstanding Tranche C Term Loans;
e. the Administrative Agent shall have received payment in immediately
available funds of all expenses incurred by the Administrative Agent (including,
without limitation, legal fees) for which invoices have been presented, on or
before the Amendment Effective Date;
f. the Administrative Agent and the Lenders shall have received legal
opinions from (i) the Borrower's New York counsel reasonably satisfactory to the
Administrative Agent, (ii) Miles & Stockbridge, (iii) Xxxxxx Xxxxxxxxxxx Xxxxx &
Xxxxxx and (iv) other counsel requested by the Administrative Agent, each in
form and substance reasonably satisfactory to the Administrative Agent, dated as
of the Amendment Effective Date and addressed to each of the Administrative
Agent, the Documentation Agent, the Syndication Agent, the Co-Agent, the Lead
Arranger and the Lenders;
g. the Required Lenders and the Required Tranche C Term Lenders shall
be satisfied with the continued perfection and priority of the Liens of the
Administrative Agent
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on the Collateral and will have received such title insurance endorsements and
other documents and agreements as they may reasonably require;
h. the Administrative Agent shall have received satisfactory evidence
that the execution, delivery and performance of this Agreement (including,
without limitation, the amendments to the Credit Agreement contained herein)
have been duly approved by all necessary corporate action of each Credit Party;
and
i. the Administrative Agent shall have received such other documents,
instruments, certificates, opinions and approvals as it may reasonably request.
5. Representations and Warranties. The Borrower and each of the other
Credit Parties represents and warrants to the Administrative Agent and the
Lenders as follows:
a. Authority. Each of the Credit Parties has the requisite corporate
power and authority to execute and deliver this Agreement and to perform its
obligations hereunder and under the Credit Agreement (as modified hereby). The
execution, delivery and performance by the Borrower and each other Credit Party
of this Agreement, the Credit Agreement (as modified hereby) and the
transactions contemplated hereby and thereby have been duly approved by all
necessary corporate action of such Person and no other corporate proceedings on
the part of each such Person are necessary to consummate such transactions
(except as expressly contemplated hereby and thereby).
b. Enforceability. This Agreement has been duly executed and delivered
by the Borrower and the other Credit Parties. Each of this Agreement and, after
giving effect to this Agreement, the Credit Agreement and the other Credit
Documents is the legal, valid and binding obligation of each Credit Party hereto
and thereto, enforceable against such Credit Party in accordance with its terms,
and is in full force and effect. Neither the execution, delivery or performance
of this Agreement or of the Credit Agreement (as modified hereby), nor the
performance of the transactions contemplated hereby or thereby, will adversely
affect the validity, perfection or priority of the Administrative Agent's Lien
on any of the Collateral. The Borrower's name change from "Prison Realty Trust,
Inc.," to "Corrections Corporation of America" has not adversely affected the
enforceability of any of the Credit Documents or the creation, perfection or
priority of any of the Administrative Agent's Liens on the Collateral. The
consents and amendments with respect to the Credit Agreement contained herein
have been validly approved as required under Section 11.6 and 11.6A of the
Credit Agreement and such consents and amendments are binding on the Lenders.
c. Representations and Warranties. After giving effect to this
Agreement, the representations and warranties contained in the Credit Agreement
and the other Credit Documents (other than any such representations and
warranties that, by their terms, are specifically made as of a date other than
the date hereof) are true and correct on and as of the date hereof as though
made on and as of the date hereof.
d. No Conflicts. Neither the execution and delivery of this Agreement,
nor the consummation of the transactions contemplated hereby (including, without
limitation, the Management Opco Merger, the Service Company Mergers and the
Service Company
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Agreements), nor performance of and compliance with the terms and provisions
hereof by such Credit Party will, at the time of such performance, (a) violate
or conflict with any provision of its articles or certificate of incorporation
or bylaws or other organizational or governing documents of such Person, (b)
violate, contravene or materially conflict with any Requirement of Law or any
other law, regulation (including, without limitation, Regulation U or Regulation
X), order, writ, judgment, injunction, decree or permit applicable to it, except
for any violation, contravention or conflict which could not reasonably be
expected to have a Material Adverse Effect, (c) violate, contravene or conflict
with contractual provisions of, or cause an event of default under, any
indenture, loan agreement, mortgage, deed of trust, contract or other agreement
or instrument to which it is a party or by which it may be bound (including,
without limitation, the Senior Notes Indenture, the MDP Note Purchase Agreement,
the PMI Note Purchase Agreement and the Management Opco Credit Agreement),
except for any violation, contravention or conflict which could not reasonably
be expected to have a Material Adverse Effect, or (d) result in or require the
creation of any Lien (other than those contemplated in or created in connection
with the Credit Documents) upon or with respect to its properties.
e. No Default. After giving effect to the consents set forth in
Section 2 hereof, no Default or Event of Default shall have occurred and be
continuing under the Credit Agreement or any other Credit Document.
6. Reference to and Effect on Credit Agreement.
a. Upon and after the effectiveness of this Agreement, each reference in
the Credit Agreement to "this Agreement", "hereunder", "hereof" or words of like
import referring to the Credit Agreement, and each reference in the other Credit
Documents to "the Credit Agreement", "thereunder", "thereof" or words of like
import referring to the Credit Agreement, shall mean and be a reference to the
Credit Agreement as modified hereby.
b. Except as specifically modified above, the Credit Agreement and the
other Credit Documents are and shall continue to be in full force and effect and
are hereby in all respects ratified and confirmed. Without limiting the
generality of the foregoing, the Collateral Documents and all of the Collateral
described therein do and shall continue to secure the payment of all Credit
Party Obligations under and as defined therein, in each case as modified hereby.
The consents contained in Section 2 of this Agreement are limited to the
specific facts and circumstances set forth therein and shall not operate as a
waiver of, or a consent to any variation from, any other provision of the Credit
Agreement or any other Credit Document.
c. The execution, delivery and effectiveness of this Agreement shall
not, except as expressly provided herein, operate as a waiver of any right,
power or remedy of any Secured Party under any of the Credit Documents, nor,
except as expressly provided herein, constitute a waiver or amendment of any
provision of any of the Credit Documents.
7. Counterparts. This Agreement may be executed in any number of
counterparts and by different parties hereto in separate counterparts, each of
which when so executed and delivered shall be deemed to be an original and all
of which taken together shall constitute one and the same agreement. Delivery of
an executed counterpart of a signature page to this
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Agreement by facsimile shall be effective as delivery of a manually executed
counterpart of this Agreement.
8. Severability. Any provision of this Agreement that is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
9. Governing Law. This Agreement shall be governed by, and construed in
accordance with, the laws of the State of New York.
10. Release of Claims. Each of the Credit Parties, hereby acknowledges and
agrees that it does not have any defenses, counterclaims, offsets,
cross-complaints, claims or demands of any kind or nature whatsoever arising out
of the Credit Agreement or the other Credit Documents that can be asserted to
reduce or eliminate all or any part of the liability of such Credit Party to
repay any Secured Party, as provided in the Credit Agreement and the other
Credit Documents, or to seek affirmative relief or damages of any kind or nature
from any Secured Party arising out of the Credit Agreement or the other Credit
Documents. Each Credit Party hereby voluntarily and knowingly releases and
forever discharges each of the Secured Parties, and each Secured Party's
predecessors, agents, employees, successors and assigns, from all possible
claims, demands, actions, causes of action, damages, costs, or expenses, and
liabilities whatsoever, known or unknown, anticipated or unanticipated,
suspected or unsuspected, fixed, contingent, or conditional, at law or in
equity, originating in whole or in part on or before the effective date of this
Agreement, which such Credit Party may now or hereafter have against any such
Secured Party, and such Secured Party's predecessors, agents, employees,
successors and assigns, if any, in each case arising out of the Credit Agreement
or the other Credit Documents, irrespective of whether any such claims arise out
of contract, tort, violation of law or regulations, or otherwise, including,
without limitation, the exercise of any rights and remedies under the Credit
Agreement or the other Credit Documents, and the negotiation and execution of
this Agreement.
To the extent that such laws may be applicable, the Credit Parties waive
and release any right or defense which they might otherwise have under any law
of any applicable jurisdiction which might limit or restrict the effectiveness
or scope of any of their waivers or releases hereunder.
[Signature Pages Follow]
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IN WITNESS WHEREOF, the parties hereto have caused this
Amendment and Waiver to be executed by their respective officers thereunto duly
authorized, as of the date first written above.
CORRECTIONS CORPORATION OF
AMERICA (f/k/a Prison Realty Trust, Inc.),
a Maryland corporation
By: /s/ Xxxx X. Xxxxxxxx
-------------------------------------------
Name: Xxxx X. Xxxxxxxx
Title: President
PRISON REALTY MANAGEMENT, INC.,
a Tennessee corporation
By: /s/ Xxxx X. Xxxxxxxx
-------------------------------------------
Name: Xxxx X. Xxxxxxxx
Title: President
CCA OF TENNESSEE, INC. (f/k/a CCA
Acquisition Sub, Inc.), a Tennessee corporation
By: /s/ Xxxxx Xxxxxx
-------------------------------------------
Name: Xxxxx Xxxxxx
Title: Secretary
PMSI ACQUISITION SUB, INC.,
a Tennessee corporation
By: /s/ Xxxxx Xxxxxx
-------------------------------------------
Name: Xxxxx Xxxxxx
Title: Secretary
X-0
00
XXXXXX ACQUISITION SUB, INC.,
a Tennessee corporation
By: /s/ Xxxxx Xxxxxx
-------------------------------------------
Name: Xxxxx Xxxxxx
Title: Secretary
TRANSCOR AMERICA, LLC,
a Tennessee limited liability company
By: /s/ T. Xxx Xxxxx
-------------------------------------------
Name: T. Xxx Xxxxx
Title: Chief Manager
CCA INTERNATIONAL, INC.,
a Tennessee corporation
By: /s/ Xxxxx Xxxxxx
-------------------------------------------
Name: Xxxxx Xxxxxx
Title: Secretary
TECHNICAL AND BUSINESS
INSTITUTE, INC., a Tennessee corporation
By: /s/ Xxxxx Xxxxxx
-------------------------------------------
Name: Xxxxx Xxxxxx
Title: Secretary
XXXXXX COMMERCIAL PAPER INC.,
as Administrative Agent, on behalf of the
Required Lenders and the Required Tranche C
Term Lenders
By: /s/ Authorized Signatory
-------------------------------------------
Name:
Title:
S-2
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EXHIBIT A
Revised Schedule 6.15 to Credit Agreement
[intentionally omitted]
E-1
