EXHIBIT 10.1
SECURITIES PURCHASE AGREEMENT
Securities Purchase Agreement (this "Agreement") made as of this 28th
day of March, 2003, by and between Corrections Corporation of America, a
Maryland corporation (the "Company"), the parties set forth on the signature
pages attached hereto (collectively, the "Noteholders") and MDP Ventures IV LLC,
a New York limited liability company.
WHEREAS, the Noteholders, as of the date hereof, own all of the
$40,000,000 principal amount of 10% Convertible Subordinated Notes due December
31, 2008 (the "Notes") issued by the Company, in such amounts as are set forth
on Schedule A hereto;
WHEREAS, the Notes are convertible, at the option of the Noteholders,
into shares of common stock, par value $0.01 per share (the "Common Stock"), of
the Company; and
WHEREAS, the Company desires to purchase from the Noteholders all of
the shares of Common Stock issuable upon conversion of the Notes and the
Noteholders desire to convert the Notes into shares of Common Stock and sell
such shares of Common Stock to the Company, in accordance with the terms of this
Agreement, in full satisfaction of the obligations of the Company and its
affiliates under the Notes.
NOW, THEREFORE, in consideration of the mutual promises, covenants,
conditions and agreements herein contained, the parties hereto, intending to be
legally bound, agree as follows:
ARTICLE I.
CONVERSION OF NOTES AND PURCHASE OF SHARES
1.1 Subject to the terms and conditions of this Agreement, the
Noteholders hereby agree at the Closing (as defined herein) to convert the Notes
into the Exchange Shares (as defined herein). The Notes set forth on Schedule A
constitute all of the outstanding Notes issued pursuant to that certain Note
Purchase Agreement dated December 31, 1998, as amended pursuant to that certain
Waiver and Amendment dated as of June 30, 2000 (as so amended, the "Note
Purchase Agreement"). Capitalized terms used herein and not defined herein shall
have the meanings ascribed thereto in the Note Purchase Agreement.
(a) Notwithstanding anything to the contrary in the Note
Purchase Agreement, any conversion of the Notes into the Exchange Shares shall
be revoked automatically in the event that this Agreement is terminated pursuant
to Article VIII hereof, or in the event that the Company does not pay the full
amount of the Purchase Price (as defined herein) to the Noteholders at the
Closing.
(b) "Exchange Shares" means that number of shares of Common
Stock into which the Notes would be converted on the Closing Date (as defined
herein) in accordance with Section 13 of the Note Purchase Agreement.
1.2 Subject to the conversion of the Notes into the Exchange Shares as
contemplated by Section 1.1 of this Agreement, the Noteholders agree at the
Closing to sell, transfer and
convey the Exchange Shares to the Company, free and clear of all liens, claims,
charges, restrictions, security interests, equities, proxies, pledges or other
encumbrances of any kind (collectively, "Encumbrances"), other than any
Encumbrances that are created or granted by the Company.
ARTICLE II.
CONSIDERATION
2.1 Purchase Price. The purchase price (the "Purchase Price") for the
Exchange Shares shall be paid in cash to the Noteholders at the Closing and
shall be equal to the sum of the following:
(a) the "Base Purchase Price," which for purposes of this
Agreement means an amount equal to the product of the number of Exchange Shares
multiplied by the Offering Price (as defined herein); and
(b) the "Contingent Interest Payment," which for purposes of
this Agreement means the amount of Contingent Interest payable with respect to
the Notes as determined in accordance with Section 2.5 of the Note Purchase
Agreement, from the issue date of the Notes through and including the Closing
Date. By way of illustration, assuming a Closing Date of December 31, 2003, the
Contingent Interest Payment on such date, calculated in accordance with Section
2.5 of the Note Purchase Agreement, would be $17,063,944.00. In the event that
the Closing Date occurs prior to December 31, 2003, such Contingent Interest
Payment shall be subject to decrease, computed on a pro rated daily basis in
accordance with Section 2.5 of the Note Purchase Agreement.
The "Offering Price" means the greater of (i) the Guaranteed Share Price and
(ii) the highest gross offering price to the public per share (without any
deduction or set-off) of the Common Stock in any equity offering comprising the
Equity Offering (as defined herein). For purposes of this Agreement, the
"Guaranteed Share Price" means $16.83 per share, subject to adjustment, if, and
on the same basis as, the Conversion Rate (as defined in the Note Purchase
Agreement) is adjusted after the date hereof pursuant to the Note Purchase
Agreement. In no event shall the Base Purchase Price be less than
$56,597,590.00, and for each $0.01 that the Offering Price per share is greater
than $16.83 (subject to adjustment, if, and on the same basis as, the Conversion
Rate is adjusted after the date hereof pursuant to the Note Purchase Agreement),
the Base Purchase Price shall be increased above $56,597,590.00 by $33,628.90.
2.2 Payment of Purchase Price. At the Closing, the Company shall
deliver by wire transfer, pursuant to the instructions provided by each
Noteholder as set forth on Schedule B hereto, each Noteholder's pro rata portion
of the Purchase Price. Each Noteholder's pro rata portion of the Purchase Price
is set forth on Schedule A.
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ARTICLE III.
CLOSING; OBLIGATIONS OF THE PARTIES
3.1 Closing Date. The closing (the "Closing") of the purchase and sale
of the Exchange Shares pursuant to this Agreement shall take place and be
effective for all purposes upon the date of closing of, and receipt of the
proceeds from a public offering of Common Stock by the Company at a gross price
to the public of not less than $15.79 per share (subject to adjustment, if, and
on the same basis as, the Conversion Rate is adjusted after the date hereof
pursuant to the Note Purchase Agreement) resulting in gross proceeds to the
Company (before any underwriting discount or offering expenses) of at least
$100,000,000 (any such offering or series of offerings resulting in such gross
proceeds, the "Equity Offering") (the date upon which such Closing occurs is
referred to as the "Closing Date"). The Closing shall occur at the offices of
Bass, Xxxxx & Xxxx PLC, Nashville, Tennessee or as otherwise mutually agreed to
by the Company and such Noteholders holding a majority of the Exchange Shares,
on an as converted basis. In the event that the Equity Offering is comprised of
more than one public offering of the Common Stock of the Company, (i) if the
aggregate gross proceeds from such offerings equal or exceed $100,000,000, then
the Closing shall occur concurrently with such public offering that causes the
aggregate gross proceeds from all such public offerings of the Common Stock of
the Company during the term hereof to equal or exceed $100,000,000 and (ii) if
any of such public offerings are made at a gross price to the public of $15.79
or more per share (subject to adjustment, if, and on the same basis as, the
Conversion Rate is adjusted after the date hereof pursuant to the Note Purchase
Agreement), such requirement that the public offering be at a price per share at
least equal to $15.79 shall be deemed satisfied.
3.2 Obligations of the Parties at Closing.
(a) At the Closing, the Company shall deliver to the
Noteholders:
(i) the Purchase Price as specified in Section 2.1 of
this Agreement;
(ii) accrued and unpaid interest on the Notes at the
rate of 10% per annum from the last date on which interest
thereon was paid to and including the Closing Date; and
(iii) a certificate of the Company certifying as to the
accuracy of the Company's representations and warranties at and
as of the Closing Date and that the Company has performed or
complied with all of the covenants, agreements, terms, provision
and conditions to be performed or complied with by the Company
at or before Closing Date.
(b) At the Closing Date, the Noteholders shall deliver to the
Company:
(i) the certificates evidencing the Notes (or an
affidavit of lost note in lieu thereof) and a Conversion Notice
(as defined in the Note Purchase Agreement) therefor; and
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(ii) a certificate of each Noteholder certifying as to
the accuracy of such Noteholder's representations and warranties
at and as of the Closing Date and that they have performed or
complied with all of the covenants, agreements, terms,
provisions and conditions to be performed or complied with by
the Noteholder at or before the Closing Date.
ARTICLE IV.
REPRESENTATIONS AND WARRANTIES OF THE NOTEHOLDERS
Each Noteholder, severally but not jointly, hereby represents and
warrants to the Company as follows:
4.1 Ownership of Notes; Authorization. The Noteholder represents and
warrants that (i) such Noteholder owns the Notes set forth beside its name on
Schedule A, free and clear of all Encumbrances, other than any Encumbrances that
are created or granted by the Company; and (ii) such Noteholder has full power
and authority to enter into this Agreement and perform its obligations hereunder
and carry out the transactions contemplated hereby. The Noteholder hereby
authorizes the conversion of the Notes that it holds into the Exchange Shares at
the Closing in order to effect the transactions contemplated hereby. Upon the
Closing and the payment of all amounts due hereunder, the Noteholder affirms the
cancellation of the Notes that it holds.
4.2 Validly and Enforceability. This Agreement constitutes a legal,
valid and binding agreement of the Noteholder, enforceable in accordance with
its terms.
4.3 No Violation. The execution and delivery of this Agreement by the
Noteholder does not, and the consummation of the transactions contemplated
hereby will not, (a) violate any provision of, or result in the creation of any
lien or security interest under, any agreement, indenture or other instrument to
which such Noteholder is a party or by which such Noteholder's assets or
properties are bound; (b) violate any organizational or governing agreement of
such Noteholder; (c) violate any order, arbitration award, judgment, writ,
injunction, decree, statute rule or regulation applicable to such Noteholder; or
(d) violate any other contractual or legal obligation or restriction to which
such Noteholder or its property is subject.
4.4 Consents and Approvals. The Noteholder has obtained all consents,
approvals, authorizations or orders necessary for the authorization, execution
and performance of this Agreement by such Noteholder.
ARTICLE V.
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company hereby represents and warrants to each Noteholder as
follows:
5.1 Organization and Good Standing. The Company is a corporation duly
incorporated, validly existing and in good standing under the laws of the State
of Maryland and
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has full corporate power and authority to enter into this Agreement, to
consummate the transactions contemplated hereby and to fulfill its obligations
hereunder.
5.2 Authorization. The Board of Directors of the Company has taken all
action required by law, its Charter, its Bylaws and otherwise to authorize the
execution and delivery by the Company of this Agreement and the consummation by
the Company of the transactions contemplated hereby.
5.3 Valid and Binding Agreement. This Agreement constitutes a valid and
binding agreement of the Company, enforceable against the Company in accordance
with its terms.
5.4 No Violation. The execution and delivery of this Agreement by the
Company does not, and the consummation of the transactions contemplated hereby
will not, (a) subject to the consent set forth in Section 7.1(a) of this
Agreement, violate any provision, or result in the creation of any lien or
security interest under, any agreement, indenture, instrument, lease, security
agreement, mortgage or lien to which the Company or any of its subsidiaries is
party or by which it or they are bound; (b) violate any provision of the
Company's Charter or Bylaws; (c) violate any order, arbitration award, judgment,
writ, injunction, decree, statute, rule or regulation applicable to the Company
or any of its subsidiaries; or (d) violate any other contractual or legal
obligation or restriction to which the Company or any of its subsidiaries or its
or their property is subject.
5.5 Consents and Approvals. Except for the consent set forth in Section
7.1(a) of this Agreement, the Company has obtained all consents, approvals,
authorizations or orders necessary for the authorization, execution and
performance of this Agreement by the Company.
5.6 Solvency. The Company is, and upon the consummation of the
transactions contemplated hereby will continue to be, Solvent. The Company shall
be deemed to be "Solvent" as of any date of determination, if (i) the Company's
liabilities, other than liabilities to its stockholders on account of their
interests as stockholders (and other than liabilities for which the recourse of
creditors is limited to certain property), does not exceed the fair value of the
assets of the Company, except that the fair value of property that is subject to
a liability for which the recourse of creditors is limited to such property
shall be included in the assets of the Company only to the extent that the fair
value of the property exceeds such liability; (ii) the Company's capital is not
unreasonably small in relation to its business or any contemplated or undertaken
transaction; and (iii) the Company does not intend to incur, nor does it
reasonably believe that it will incur, debts beyond its ability to pay such
debts as they become due.
ARTICLE VI.
COVENANTS
6.1 Release by the Company. In consideration of the sale of the
Exchange Shares, at the Closing, the Company will deliver to each of the
Noteholders a release containing the following operative language:
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"The Company forever settles, releases, waives and acquits the
Noteholders, their respective predecessors, successors, purchasers,
benefit plans, subsidiaries, assigns, affiliates and the officers,
agents, directors, or employees of any of them of and from any and all
claims, liabilities, controversies, damages, actions, cause or causes
of action, suits, demands, debts, obligations, indebtedness, breaches
of contract, breaches of duty or any relationship, acts, omissions,
malfeasance, sums of money, accounts, compensations, contracts,
controversies, promises, damages, costs, losses and expenses of every
type, kind, nature, description or character and irrespective of how,
why or by reason of what facts, whether heretofore or then existing or
thereafter discovered, or which could, might or may be claimed to
exist, of whatever kind or name, whether known or unknown, suspected or
unsuspected, liquidated or unliquidated, whether at law, equity or in
administrative proceedings, whether at common law or pursuant to
federal, state or local statute, each as though fully set forth therein
at length, which either one, or any one or more of them, ever had, now
have or which may result from the existing or past state of things,
from the beginning of the world to the end of the day upon which such
release is executed which arise out of or in connection with the Notes
and the Note Purchase Agreement."
6.2 Release by the Noteholders. In consideration of the sale of the
Exchange Shares, at the Closing, each of the Noteholders will deliver to the
Company a release containing the following operative language:
"The Noteholder forever settles, releases, waives and acquits the
Company, its predecessors, successors, purchasers, benefit plans,
subsidiaries, assigns, affiliates and the officers, agents, directors,
or employees of any of them of and from any and all claims,
liabilities, controversies, damages, actions, cause or causes of
action, suits, demands, debts, obligations, indebtedness, breaches of
contract, breaches of duty or any relationship, acts, omissions,
malfeasance, sums of money, accounts, compensations, contracts,
controversies, promises, damages, costs, losses and expenses of every
type, kind, nature, description or character and irrespective of how,
why or by reason of what facts, whether heretofore or then existing or
thereafter discovered, or which could, might or may be claimed to
exist, of whatever kind or name, whether known or unknown, suspected or
unsuspected, liquidated or unliquidated, whether at law, equity or in
administrative proceedings, whether at common law or pursuant to
federal, state or local statute, each as though fully set forth therein
at length, which either one, or any one or more of them, ever had, now
have or which may result from the existing or past state of things,
from the beginning of the world to the end of the day upon which such
release is executed which arise out of or in connection with the Notes
and the Note Purchase Agreement; provided however, that such release
shall not relate to any securities of the Company that are owned by the
Noteholder other than the Notes and the Exchange Shares."
6.3 Agreement Not to Purchase, Sell or Convert. Each Noteholder hereby
agrees, until the earlier of the Closing Date and the date on which this
Agreement is validly terminated pursuant to Article VIII hereof, that without
the prior written consent of the Company such Noteholder shall not, and shall
cause its affiliates not to, directly or indirectly, other than as contemplated
by this Agreement, (i) purchase, contract to purchase or otherwise acquire any
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shares of the Company's capital stock, other than through the purchase of any
shares in a mutual fund or similar discretionary investment vehicle which
invests from time to time in such capital stock, (ii) offer, pledge, sell,
contract to sell, grant any option or right to purchase or for the sale of or
lend or otherwise dispose of or transfer (collectively, "Transfer") the Notes
held by such Noteholder or the Company's capital stock or any securities
convertible into or exchangeable or exercisable for or repayable with the
Company's capital stock, other than the 28,587 shares of the Company's Common
Stock owned by the Noteholders or their affiliates (the "Noteholder Shares") as
of the date hereof; provided that such Noteholder Shares shall not be
Transferred during the ten business day period following the receipt by the
Noteholders of written notice from the Company of the Company's intent to
consummate a public offering of its Common Stock (which such notice may not be
given more than three (3) times during the term of this Agreement), (iii) demand
or request that the Company file any registration statement under the Securities
Act of 1933, as amended, with respect to the Exchange Shares other than as
contemplated below, (iv) other than as contemplated hereby, enter into any swap
or any similar transaction that transfers, in whole or in part, directly or
indirectly, the economic consequence of ownership of any equity or debt
securities of the Company or (v) deliver a Conversion Notice to the Company with
respect to the Notes held by such Noteholder. Notwithstanding the foregoing, if
the Closing has not occurred on or before September 30, 2003, the Company shall
use commercially reasonable efforts to prepare and file a Registration Statement
on Form S-3, if eligible to use such form, (or to file a post-effective
amendment to the Company's Registration Statement on Form S-1 to effect a change
in such form to make it a Registration Statement on Form S-3) with the
Securities and Exchange Commission as soon as practicable thereafter with
respect to the Exchange Shares in accordance with the terms of the Registration
Rights Agreement (as defined in the Note Purchase Agreement) and shall use
commercially reasonable efforts to have such Registration Statement declared
effective by the Securities and Exchange Commission by December 31, 2003. The
last sentence of this Section 6.3 shall survive the termination of this
Agreement pursuant to Article VIII hereof.
6.4 Payment of Interest on the Notes. The Company acknowledges that
until the Closing Date, interest will continue to accrue on the Notes at the
rate of 10% per annum in accordance with the Note Purchase Agreement and will be
payable as set forth therein.
6.5 Abandonment of Proposed Transactions. If the Company decides to
abandon the Equity Offering at any time prior to December 31, 2003, the Company
shall notify the Noteholders of such abandonment and this Agreement will
terminate upon receipt of such notice by the Noteholders. For purposes of this
Section 6.5, any abandonment shall be in the sole discretion of the Company; any
action taken by or inaction of the Company shall not be deemed to be an
abandonment of the Equity Offering; and notice of abandonment shall be given in
writing signed by the Chief Executive Officer or Chief Financial Officer of the
Company. The Noteholders acknowledge that the power to abandon the Equity
Offering is solely within the discretion of the Company and that the Company's
decision to undertake the Equity Offering at any time prior to December 31, 2003
will likely be affected by market conditions, conditions affecting the Company
specifically, and the ability of the Company to obtain the consents described
herein. The Noteholders further acknowledge that they shall have no right to
claim any termination of their obligations under this Agreement on account of
abandonment by the Company of the Equity Offering unless and until the Company
gives the written notice specified herein.
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6.6 Amendment to Note Purchase Agreement. The Company and the
Noteholders agree that this Section 6.6 shall operate to amend the Note Purchase
Agreement as follows, which amendment shall inure to the benefit of each of the
Noteholders and their respective successors and assigns:
(a) Section 2.5 of the Note Purchase Agreement is hereby amended
by deleting in its entirety the current Section 2.5 and replacing it with the
following new Section 2.5:
"2.5 Contingent Interest. Upon each of (x) December 31, 2003
and (y) repayment of the Notes (whether at Maturity, as a
result of the occurrence of a Repurchase Right Event, optional
prepayment, a Termination Event or otherwise) (each a
"Contingent Interest Payment Date"), Investor shall receive
contingent interest ("Contingent Interest"), payable in cash,
in an amount that would be sufficient to permit Investor to
receive an IRR of 15.5% on the principal amount of the Notes
(computed without regard to the payment of any interest that
accrued at the Default Rate); provided, however, that Investor
shall not be entitled to receive Contingent Interest with
respect to the principal amount of any Notes that have been
converted into Common Stock pursuant to Section 13 on or
before such Contingent Interest Payment Date."
(b) Section 15.17 of the Note Purchase Agreement is hereby
amended by deleting in its entirety the definition of "Target Price Condition."
(c) Notwithstanding the foregoing, for purposes of this
Agreement, the proviso in the amended Section 2.5 of the Note Purchase Agreement
above shall not eliminate, limit or restrict the payment of the Contingent
Interest Payment component of the Purchase Price set forth in Section 2.1(b)
hereof.
(d) If this Agreement is terminated on or prior to December 31,
2003, pursuant to the terms of Section 2.5 of the Note Purchase Agreement, as
amended by this Section 6.6, the Company shall nonetheless be required, pursuant
to the Note Purchase Agreement as amended by this Section 6.6, to pay to the
Noteholders the Contingent Interest accruing on the Notes (other than with
respect to any Notes that are converted into Common Stock pursuant to Section 13
of the Note Purchase Agreement after the date of such termination and on or
prior to the date that such payment of Contingent Interest is required to be
made under the Note Purchase Agreement) calculated as set forth in the Note
Purchase Agreement. For purposes of illustration, if this Agreement is
terminated on or prior to December 31, 2003 (including, but not limited to, as a
result of the Closing not occurring on or prior to December 31, 2003), the
Company shall pay to the Noteholders on December 31, 2003 the amount of
$17,063,944.00 (or, if a portion of the Notes have been converted into Common
Stock after the date of such termination and on or prior to December 31, 2003,
the pro rata portion thereof in respect of the principal amount of Notes
outstanding that have not been converted into Common Stock as of such date) in
respect of Contingent Interest to and including such date, which payment of
Contingent Interest shall be made to the Noteholders based upon their pro rata
portion as set forth on Schedule A hereto.
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ARTICLE VII.
CONDITIONS
7.1 Conditions to the Company's Obligations. All obligations of the
Company hereunder are subject to the fulfillment, or waiver by the Company in
its sole discretion, prior to or at the Closing, of each of the following:
(a) Receipt of the consent of the Required Lenders under the
Company's Third Amended and Restated Credit Agreement dated May 3, 2002 (the
"Senior Credit Facility"). For purposes hereof, the "Required Lenders" shall
mean the lenders under the Senior Credit Facility whose consent to the
transactions contemplated by this Agreement and the related financing
transactions conducted by the Company and the redemption of all of the
outstanding shares of Series A Preferred Stock, par value $0.01 per share, of
the Company (the "Series A Preferred Stock") is required in order to permit such
transactions to be consummated.
(b) The Company shall have consummated the Equity Offering and
the net proceeds therefrom, together with other cash and financing proceeds then
available to the Company, shall be sufficient to pay the Purchase Price and to
redeem all of the shares of Series A Preferred Stock that are issued and
outstanding as of the Closing Date.
(c) The Noteholders shall have delivered to the Company the
release contemplated by Section 6.2 hereof.
(d) The representations and warranties made by Noteholders in
this Agreement shall be true when made and at and as of the Closing Date as
though such representations and warranties were made at and as of the Closing
Date.
(e) The Noteholders shall have performed and complied with all
covenants, agreements, obligations and conditions required by this Agreement to
be so complied with or performed at or prior to the Closing Date.
7.2 Conditions to the Noteholders' Obligations. All obligations of the
Noteholders hereunder are subject to the fulfillment, or waiver by the
Noteholders holding a majority of the Exchange Shares on an as-converted basis
in their sole discretion, prior to or at the Closing, of each of the following:
(a) Receipt of the consent of the Required Lenders under the
Senior Credit Facility as set forth in Section 7.1(a) hereof.
(b) The Company shall have consummated the Equity Offering.
(c) The Company shall have delivered to the Noteholders the
release contemplated by Section 6.1 hereof.
(d) The representations and warranties made by the Company in
this Agreement shall be true when made and at and as of the Closing Date as
though such representations and warranties were made at and as of the Closing
Date.
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ARTICLE VIII.
TERMINATION
(e) The Company shall have performed and complied with all
covenants, agreements, obligations and conditions required by this Agreement to
be so complied with or performed at or prior to the Closing Date.
8.1 This Agreement may be terminated at any time prior to the Closing:
(a) By mutual agreement of the Company and each of the
Noteholders.
(b) By the Company, if there has been a material violation or
breach by any Noteholder of any of the agreements, representations or warranties
contained in this Agreement which has not been waived in writing.
(c) By the Noteholders holding a majority of the Exchange Shares
on an as-converted basis, if there has been a material violation or breach by
the Company of any of the agreements, representations or warranties contained in
this Agreement which has not been waived in writing.
(d) By the Noteholders holding a majority of the Exchange Shares
on an as-converted basis, if a Default (as defined in the Note Purchase
Agreement) or Event of Default (as defined in the Note Purchase Agreement) has
occurred under the Note Purchase Agreement after the date of this Agreement.
(e) By either the Company or the Noteholders holding a majority
of the Exchange Shares on an as-converted basis if the other makes an assignment
for the benefit of creditors, files a voluntary petition in bankruptcy or seeks
or consents to any reorganization or similar relief under any present or future
bankruptcy act or similar law, or is adjudicated a bankrupt or insolvent, or if
a third party commences any bankruptcy, insolvency, reorganization or similar
proceeding involving the other.
(f) Automatically upon the Company's delivery of notice to the
Noteholders of its intention to abandon the Equity Offering as described in
Section 6.5 hereof.
8.2 At the close of business on December 31, 2003, this Agreement shall
terminate automatically, without any action by the parties hereto, if the
Closing shall not have occurred on or before such date.
ARTICLE IX.
MISCELLANEOUS
9.1 Expenses. All fees and expenses relating to this Agreement and
relating to the Equity Offering and any other related financing transactions
incurred by the Company, including, without limitation, all legal fees and
expenses, shall be borne by the Company, and all fees and expenses incurred by
the Noteholders in connection with the preparation and negotiation of this
Agreement shall be borne by the Noteholders, except that the Company shall
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pay the reasonable fees and expenses of one counsel for the Noteholders in
connection with the preparation and negotiation of this Agreement, subject to a
maximum of $10,000.
9.2 Survival of Representations. All representations, warranties,
covenants and agreements by the parties contained in this Agreement shall
survive the Closing and any investigation at any time made by or on behalf of
any party hereto.
9.3 Assignability; Parties in Interest.
(a) Neither the Company nor the Noteholders may assign, transfer
or otherwise dispose of any of their rights hereunder without the prior written
consent of the other parties hereto.
(b) All the terms and provisions of this Agreement shall be
binding upon, shall inure to the benefit of and shall be enforceable by the
respective heirs, successors, permitted assigns and legal or personal
representatives of the parties hereto.
9.4 Entire Agreement; Amendments. This Agreement, including the
exhibits, Schedules, lists and other documents and writings referred to herein
or delivered pursuant hereto, which form a part hereof, contains the entire
understanding of the parties with respect to its subject matter. There are no
restrictions, agreements, promises, warranties, covenants or undertakings other
than those expressly set forth herein or therein. This Agreement supersedes all
prior agreements and understandings between the parties with respect to its
subject matter. This Agreement may be amended only by a written instrument duly
executed by all parties or their respective heirs, successors, assigns or legal
personal representatives. Any condition to a party's obligations hereunder may
be waived but only by a written instrument signed by the party entitled to the
benefits thereof. The failure or delay of any party at any time or times to
require performance of any provision or to exercise its rights with respect to
any provision hereof, shall in no manner operate as a waiver of or affect such
party's right at a later time to enforce the same.
9.5 No Waiver of Rights Under the Notes. Nothing in this Agreement
shall be construed to operate as a waiver by any of the Noteholders of any of
their respective rights under the Notes or the Note Purchase Agreement. The Note
Purchase Agreement and the Registration Rights Agreement, dated as of December
31, 1998, shall each remain in full force and effect, except as expressly
modified pursuant hereto, until the consummation of all of the transactions
contemplated by this Agreement.
9.6 Headings. The section and paragraph headings contained in this
Agreement are for reference purposes only and shall not affect in any way the
meaning or interpretations of this Agreement.
9.7 Severability. If any particular provision of this Agreement shall
be adjudicated by a court of competent jurisdiction to be invalid, prohibited or
unenforceable for any reason, such provision, as to such jurisdiction, shall be
ineffective, without invalidating the remaining provisions of this Agreement or
affecting the validity or enforceability of the remaining provisions of this
Agreement or affecting the validity or enforceability of such provision in any
other jurisdiction. Notwithstanding the foregoing, if such provision could be
more narrowly
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drawn so as not to be invalid, prohibited or unenforceable in such jurisdiction,
it shall, as to such jurisdiction, be so narrowly drawn, without invalidating
the remaining provisions of this Agreement or affecting the validity or
enforceability of such provision in any other jurisdiction.
9.8 Notices. All notices, requests, claims, demands and other
communications hereunder shall be deemed to have been duly given if delivered or
mailed (registered or certified mail, postage prepaid, return receipt requested)
as follows:
If to the Company:
Corrections Corporation of America
00 Xxxxxx Xxxxx Xxxxxxxxx
Xxxxxxxxx, XX 00000
Attention: General Counsel
With a copy to:
Bass, Xxxxx & Xxxx PLC
000 Xxxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxxxx, XX 00000
Attention: F. Xxxxxxxx Xxxxxx, Xx.
If to a Noteholder:
to the respective address set forth in the signature pages hereto
With a copy to:
Paul, Hastings, Xxxxxxxx & Xxxxxx LLP
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx X. Xxxxxxxxxx, Esq.
or to such other address as any party may have furnished to the others in
writing and shall be or to such other address as any party may have furnished to
the others in writing in accordance herewith, except that notices of change of
address shall only be effective upon receipt.
9.9 Governing Law; Enforcement of Judgments; Waiver of Jury Trial;
Confidentiality.
(a) The corporate law of Maryland shall govern all issues
concerning the relative rights of the Company and its stockholders with respect
to the Company's capital stock. All other questions concerning the construction,
interpretation and validity of this Agreement shall be governed by and construed
and enforced in accordance with the domestic laws of the State of New York,
without giving effect to any choice or conflict of law provision or rule
(whether in the State of New York or any other jurisdiction) that would cause
the application of the laws of any jurisdiction other than the State of New
York. In furtherance of the foregoing,
12
the internal laws of the State of New York will control the interpretation and
construction of this Agreement, even if under such jurisdiction's choice of law
or conflict of law analysis, the substantive law of some other jurisdiction
would ordinarily or necessarily apply.
(b) Each of the Company and each Noteholder irrevocably submits
to the exclusive jurisdiction of (i) the Supreme Court of the State of New York
located in New York County, City of New York and (ii) the United States District
Court for the Southern District of New York, for the purposes of any suit,
action or other proceeding relating to this Agreement. Each of the Company and
each Noteholder agrees to commence any action, suit or Proceeding relating
hereto either in the United States District Court for the Southern District of
New York, or, if such suit, action or proceeding may not be brought in such
court for jurisdictional reasons, in the Supreme Court of the State of New York
located in New York County, City of New York. The Company further agrees that
service of process, summons, notice or document by hand delivery or U.S.
registered certified mail return receipt requested in care of Bass, Xxxxx & Xxxx
PLC, AmSouth Center, 000 Xxxxxxxxx Xxxxxx, Xxxxx 0000, Xxxxxxxxx, Xxxxxxxxx
00000, Attention: F. Xxxxxxxx Xxxxxx, Xx. and in care of Xxxxxx & Xxxxxxxxxxx,
P.A., 000 Xxxxxx Xxxxxx, Xxxxx 0000, Xxxxxxxxx, Xxxxxxxxx 00000, Attention:
Xxxxxxxxx X. Xxxxx, Esq., shall be effective service of process for any action,
suit or proceeding brought against the Company in any such court. Each of the
Company and each Noteholder irrevocably and unconditionally waives any objection
to the laying of venue of any action, suit or proceeding relating to this
Agreement and any of the transactions contemplated hereby in (i) the Supreme
Court of the State of New York located in New York County, City of New York or
(ii) the United States District Court for the Southern District of New York and
hereby further irrevocably and unconditionally waives and agrees not to plead or
claim in any such court that any such action, suit or proceeding brought in any
such court has been brought in an inconvenient forum.
(c) The Company agrees, to the fullest extent it may effectively
do so under applicable law, that a judgment in any suit, action, or proceeding
of the nature referred to in Section 9.9(b) hereof brought in any such court
shall be conclusive and binding upon the Company and may be enforced in the
courts of the United States of America or the State of New York (or any other
court to the jurisdiction of which the company is or may be subject) by a suit
upon such judgment.
EACH PARTY HERETO HEREBY EXPRESSLY WAIVES ITS RESPECTIVE RIGHTS TO A JURY TRIAL
OR ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS AGREEMENT, OR
ANY DEALINGS BETWEEN THEM RELATING TO THE SUBJECT MATTER OF THIS AGREEMENT AND
THE CONTRACTUAL RELATIONSHIP THAT IS BEING ESTABLISHED. THE SCOPE OF THIS WAIVER
IS INTENDED TO BE ALL-ENCOMPASSING OF ANY AND ALL DISPUTES THAT MAY BE FILED IN
ANY COURT AND THAT RELATE TO THE SUBJECT MATTER OF THIS AGREEMENT, INCLUDING
CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS, AND ALL OTHER COMMON LAW
AND STATUTORY CLAIMS. EACH PARTY HERETO ACKNOWLEDGES THAT THIS WAIVER IS A
MATERIAL INDUCEMENT TO ENTER INTO A BUSINESS RELATIONSHIP, THAT EACH HAS ALREADY
RELIED ON THIS WAIVER IN ENTERING INTO THIS AGREEMENT, AND THAT EACH WILL
CONTINUE TO RELY ON THIS WAIVER IN THEIR RELATED FUTURE DEALINGS. EACH PARTY
HERETO FURTHER WARRANTS AND
13
REPRESENTS THAT EACH HAS REVIEWED THIS WAIVER WITH ITS LEGAL COUNSEL, AND THAT
EACH KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING
CONSULTATION WITH LEGAL COUNSEL. THIS WAIVER IS IRREVOCABLE, MEANING THAT IT MAY
NOT BE MODIFIED EITHER ORALLY OR IN WRITING, AND THIS WAIVER SHALL APPLY TO ANY
SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS, OR MODIFICATIONS TO THIS
AGREEMENT. IN THE EVENT OF LITIGATION, THIS AGREEMENT MAY BE FILED AS A WRITTEN
CONSENT TO A TRIAL BY THE COURT.
(d) Each Noteholder agrees that it will keep confidential and
will not use, disclose or divulge any non-public, or confidential, proprietary
or secret information which such Noteholder may obtain from the Company or its
representatives in connection with this Agreement (including the terms of this
Agreement and the existence hereof), unless such information is known, or until
such information becomes known, to the public; provided, however, that such
Noteholder may disclose such information (i) to its members, partners,
directors, officers, attorneys, accountants, consultants, and other
professionals to the extent necessary to obtain their services in connection
with the transactions contemplated by this Agreement and will cause such persons
to abide by the terms of this Section 9.9(d) or (ii) as required by applicable
law or regulation, court or administrative order, or any listing or trading
agreement concerning the Company.
(e) The Company agrees that it will keep confidential and not
disclose or divulge any of the terms of this Agreement; provided, however, that
the Company may disclose such terms (i) to the officers and directors of the
Company, or its attorneys, accountants, consultants, and other professionals to
the extent necessary to obtain their services in connection with this Agreement
and will cause such persons to abide by the terms of this Section 9.9(e) or (ii)
as required by applicable law or regulation, court or administrative order, or
any listing or trading agreement concerning the Company.
9.10 Enforcement of Agreement. The parties hereto agree that
irreparable damage would occur in the event that any of the provisions of this
Agreement was not performed in accordance with its specific terms or was
otherwise breached. It is accordingly agreed that the parties shall be entitled
to an injunction or injunctions to prevent breaches of this Agreement and to
enforce specifically the terms and provisions hereof in any court of competent
jurisdiction, this being in addition to any other remedy to which they are
entitled at law or in equity.
9.11 Counterparts. This Agreement may be executed in one or more
counterparts by some or all of the parties hereto, each of which counterparts
shall be an original and all of which together shall constitute a single
agreement.
[Remainder of page intentionally left blank; signature pages follow]
14
IN WITNESS WHEREOF, this Agreement has been duly executed by the
parties set forth below as of the date first written above.
CORRECTIONS CORPORATION OF AMERICA
By: /s/ Xxxxxx X. Xxxxx, Xx.
---------------------------------------
Name: Xxxxxx X. Xxxxx, Xx.
--------------------------------------
Title: Executive Vice President and Chief
------------------------------------
Financial Officer
------------------------------------
NOTEHOLDERS:
INCOME OPPORTUNITY FUND I LLC
By: Millennium Development Partners V LLC,
its managing member
By: /s/ Xxxxxx X. Xxxxxxx
---------------------------------------
Name: Xxxxxx X. Xxxxxxx
----------------------------------
Title: Vice President
---------------------------------
MILLENNIUM HOLDINGS II LLC
By: /s/ Xxxxxx X. Xxxxxxx
---------------------------------------
Name: Xxxxxx X. Xxxxxxx
---------------------------------
Title: Vice President
--------------------------------
MILLENNIUM HOLDINGS III LLC
By: /s/ Xxxxxx X. Xxxxxxx
----------------------------------------
Name: Xxxxxx X. Xxxxxxx
-----------------------------------
Title: Vice President
----------------------------------
AGREED AND ACKNOWLEDGED SOLELY
WITH RESPECT TO SECTION 6.6 HEREOF:
MDP VENTURES IV LLC
By: /s/ Xxxxxx X. Xxxxxxx
------------------------------
Name: Xxxxxx X. Xxxxxxx
-------------------------
Title: Vice President
-----------------------
15
