EXHIBIT 10.1
AGREEMENT OF SALE AND PURCHASE
(Xxxxxxx County)
THIS AGREEMENT OF SALE AND PURCHASE (this "Agreement") is made and
entered into by and between XXXXXXX CORRECTIONAL PROPERTIES, L.L.C., a Delaware
limited liability company ("CCP"), XXXXXXX CORRECTIONAL SERVICES, L.L.C., a
Delaware limited liability company ("CCS") (CCP and CCS are sometimes singularly
referred to herein as "Seller" and collectively referred to herein as "Sellers")
and CORRECTIONS CORPORATION OF AMERICA, a Maryland corporation (hereinafter
referred to as "Purchaser"). Sellers and Purchaser are sometimes collectively
referred to herein as the "Parties" and each of the Parties is sometimes
singularly referred to herein as a "Party".
WHEREAS, Sellers are the owners of the Property (as hereinafter
defined), consisting of certain real property and improvements thereon being
more particularly described on Exhibit A, attached hereto and made a part
hereof, and the personalty and agreements relating thereto; and
WHEREAS, Sellers desire to sell and Purchaser desires to purchase the
Property.
NOW, THEREFORE, in consideration of the sum of Ten Dollars ($10.00),
the mutual covenants and agreements contained herein and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
Parties agree as follows:
ARTICLE I
DEFINITIONS
As used herein, the following terms shall have the meanings indicated:
"Additional Xxxxxxx Money" shall mean the sum of One Million Seven
Hundred Fifty Dollars ($1,750,000), together with any interest earned thereon.
"Best Knowledge of Purchaser" shall mean the current actual knowledge
of Purchaser.
"Best Knowledge of Sellers" shall mean the current actual knowledge of
Sellers, after due inquiry of the Manager.
"Xxxx of Sale" shall mean a xxxx or bills of sale in form reasonably
acceptable to Purchaser sufficient to transfer to Purchaser all Personal
Property.
"Business Day(s)" shall mean calendar days other than Saturdays,
Sundays and legal holidays.
"Certificate of Non-Foreign Status" shall mean a certificate dated as
of the Closing Date, addressed to Purchaser and duly executed by each Seller,
certifying each Seller's status as a non-foreign entity.
"Closing" shall mean the consummation of the sale and purchase provided
for herein, to be held through an escrow with the Title Company or in such other
manner as the Parties may mutually agree.
"Closing Certificate" shall mean a certificate in form acceptable to
Purchaser, wherein Sellers shall represent that the representations and
warranties of Sellers contained in this Agreement are true and correct in all
material respects as of the Closing Date as if made on and as of the Closing
Date except for changes in facts or circumstances which (i) are not within the
control of Sellers or their agents, (ii) are not the result of any act or
omission of Sellers or their agents, or (iii) do not constitute a default by
either Seller hereunder.
"Closing Date" shall mean the actual day on which the transaction
contemplated hereby is closed with the transfer of title to the Property, which
transfer shall occur not later than the date that is fifteen (15) days after the
expiration of the Review Period, TIME BEING OF THE ESSENCE with respect to such
date.
"County" shall mean Xxxxxxx County, Colorado.
"County Incarceration Agreement" shall mean that certain Amended and
Restated Intergovernmental and Private Prison Contractor Agreement between CCS
and County dated January 1, 1999
"Deed" shall mean a deed in form reasonably acceptable to Purchaser,
executed by CCP, as grantor, in favor of Purchaser, as grantee, conveying the
Land and Improvements to Purchaser, subject only to the Permitted Exceptions.
"Due Diligence Materials" shall mean the RFP Materials and all other
written information and materials delivered by Sellers pursuant to Section 4.1
hereof.
"Xxxxxxx Money" shall mean the Initial Xxxxxxx Money and the Additional
Xxxxxxx Money.
"Effective Date" shall mean the later of the two (2) dates on which
this Agreement is actually signed by Sellers and Purchaser; provided that, in
the event only one Party dates its actual signature, then the date of its
signature shall be the Effective Date.
"Engineering Documents" shall mean all site plans, surveys, soil and
substrata studies, architectural drawings, plans and specifications, engineering
plans and studies, floor plans, landscape plans, Americans with Disabilities Act
compliance reports, environmental reports and studies, professional inspection
reports, construction and/or architect's reports or certificates, feasibility
studies, appraisals, and other similar plans and studies that relate to the Real
Property or the Personal Property.
"Exception Documents" shall mean true, correct and legible copies of
each document listed as an exception to title in the Title Commitment.
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"Escrow Agreement" shall mean that certain Escrow Agreement entered
into contemporaneously herewith among Sellers, Purchaser and the Title Company.
"Fixtures" shall mean all equipment, machinery, fixtures, and other
items of real and/or personal property, including all components thereof, now or
on the Closing Date located in, on or used in connection with, and permanently
affixed to or incorporated into, the Improvements, including, without
limitation, all furnaces, boilers, heaters, electrical equipment, electronic
security equipment, heating, plumbing, lighting, ventilating, refrigerating,
incineration, air and water pollution control, waste disposal, air-cooling and
air-conditioning systems and apparatus, sprinkler systems and fire and theft
protection equipment, and similar systems, all of which, to the greatest extent
permitted by law, are hereby deemed by the Parties to constitute real estate,
together with all replacements, modifications, alterations and additions
thereto, but specifically excluding all items included within the definition of
Personal Property.
"Hazardous Materials" shall mean any substance, including without
limitation, asbestos or any substance containing asbestos and deemed hazardous
under any Hazardous Materials Law, the group of organic compounds known as
polychlorinated biphenyls, petroleum products, flammable explosives, radioactive
materials, infections wastes, biomedical and medical wastes, chemicals known to
cause cancer or reproductive toxicity, pollutants, effluents, contaminants,
emissions or related materials and any items included n the definition of
hazardous or toxic wastes, materials or substances under any Hazardous Materials
Law.
"Hazardous Materials Law" shall mean any local, state or federal law
relating to environmental conditions and industrial hygiene, including without
limitation, the Resource Conservation and Recovery Act of 1976 ("RCRA"), the
Comprehensive Environmental Response, Compensation and Liability Act of 1980
("CERCLA"), as amended by the Superfund Amendments and Reauthorization Act of
1986 ("XXXX"), the Hazardous Materials Transportation Act, the Federal Waste
Pollution Control Act, the Clean Air Act, the Clean Water Act, the Toxic
Substances Control Act, the Safe Drinking Water Act, and all similar federal,
state and local environmental statutes, ordinances and the regulations, orders,
or decrees now or hereafter promulgated thereunder.
"Improvements" shall mean all buildings, improvements, structures and
Fixtures now or on the Closing Date located on the Land, including, without
limitation, landscaping, parking lots and structures, roads, drainage and all
above ground and underground utility structures, equipment systems and other
so-called "infrastructure" improvements.
"Incarceration Agreements" shall mean the County Incarceration
Agreement and the Wyoming Incarceration Agreement.
"Initial Xxxxxxx Money" shall mean the sum of Two Hundred Fifty
Thousand Dollars ($250,000), together with any interest earned thereon.
"Intangible Property" shall mean all Permits and other intangible
property or any interest therein now or on the Closing Date owned or held by
Sellers in connection with the Real Property, including all water rights and
reservations, rights to use the trade name applicable to
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the Property, and zoning rights related to the Real Property, or any part
thereof, to the extent the same are assignable by Sellers; provided, however,
"Intangible Property" shall not include the general corporate trademarks, trade
names (except as set forth above), service marks, logos or insignia or the books
and records of Sellers, Sellers' accounts receivable and Sellers' business and
operating licenses for the facilities on the Real Property.
"Land" means the real property more particularly described on Exhibit
A, attached hereto and made a part hereof, together with all of Sellers' rights,
titles, appurtenant interests, covenants, licenses, privileges and benefits
thereto belonging, and Sellers' rights, titles and interests in and to any
easements, rights-of-way, rights of ingress or egress or other interests in, on,
or to any land, highway, street, road or avenue, open or proposed, in, on,
across, in front of, abutting or adjoining such real property including, without
limitation, any strips and gores adjacent to or lying between such real property
and any adjacent real property.
"Laws" means all federal, state and local laws, moratoria, initiatives,
referenda, ordinances, rules, regulations, standards, orders and other
governmental requirements, including, without limitation, those relating to the
environment, health and safety, disabled or handicapped persons.
"Lease" shall mean that certain lease agreement by and between CCP and
CCS whereby CCP leases the Real Property to CCS.
"Management Agreement" shall mean, collectively, (1) the Xxxxxxx
Correctional Facility Management Contract dated December 21, 2000 between CCS
and Dominion Financial Services, L.L.C. and (2) the Xxxxxxx County Correctional
Facility Management Subcontract dated December 21, 2000, between Dominion
Correctional Services, L.L.C. and Dominion Financial Services, L.L.C., as
amended from time to time.
"Manager" shall mean, collectively, Dominion Correctional Services,
L.L.C. and Dominion Financial Services, L.L.C.
"Operating and Service Agreements" shall mean all operating and service
agreements and contracts entered into by either Seller (or by Manager on behalf
of either Seller) with respect to the Property other than the Incarceration
Agreements, the Lease and the Management Agreement, including, but not limited
to, food service and equipment agreements, inmate pay telephone service
agreements, medical and pharmaceutical service and supply agreements, drug
testing service agreements, public performance and licensing agreements for
motion picture video cassettes, inmate educational and instructional service
agreements, refuse service agreements, pest control service agreements and
machinery, equipment and uniform rental and service agreements.
"Permits" shall mean all permits, licenses (but excluding Sellers'
business and operating licenses), approvals, entitlements and other
governmental, quasi-governmental and nongovernmental authorizations including,
without limitation, certificates of use and occupancy and accreditations,
required in connection with the ownership, planning, development, construction,
use, operation or maintenance of the Real Property, to the extent the same are
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assignable by either Seller. As used herein, "quasi-governmental" shall include
the providers of all utility services to the Real Property.
"Permitted Exceptions" shall mean those title exceptions which are
described on Exhibit B annexed hereto and made a part hereof.
"Personal Property" shall mean all personal property, equipment,
furniture, fixtures, Intangible Property, Warranties, Engineering Documents, and
all other items of tangible personal property, and all accessories and additions
thereto, other than the Fixtures, now or on the Closing Date owned or leased by
either Seller and located on or about the Land or Improvements or used or useful
in connection with the operation thereof.
"Property" shall mean, collectively, the Land, the Improvements and the
Personal Property.
"Purchase Price" shall mean the sum of Forty-Seven Million Five Hundred
Thousand Dollars ($47,500,000).
"RFP Materials" shall mean the materials regarding the ownership and
operation of the Property which Sellers have previously delivered to Purchaser
and which are listed on Exhibit C attached hereto and made a part hereof.
"Real Property" shall mean the Land, the Improvements and the Fixtures.
"Review Period" means a period ending on January 3, 2003.
"Search Reports" shall mean reports of searches made of the Uniform
Commercial Code Records of the County in which the Property is located, and of
the office of the Secretary of State of the State in which the Property is
located and in the States in which the principal office of each Seller is
located and in which each Seller is formed, which searches shall reflect that
none of the Property is encumbered by liens or security interests which will
remain on the Property after the Closing.
"Survey" shall mean a current "as-built" ALTA survey, certified to ALTA
requirements, prepared by an engineer or surveyor licensed in the State in which
the Land is located and reasonably acceptable to Purchaser, which shall: (a)
include a narrative legal description of the Land by metes and bounds (which
shall include a reference to the recorded plat, if any), and a computation of
the area comprising the Land in both acres and gross square feet (to the nearest
one-thousandth of said respective measurement); (b) accurately show the location
on the Land of all improvements (dimensions thereof at the ground surface level
and the distance therefrom to the facing exterior property lines of the Land),
building and set-back lines, parking spaces (including number of spaces),
fences, evidence of abandoned fences, ponds, creeks, streams, rivers, officially
designated 100-year flood plains and flood prone areas, canals, ditches,
easements, roads, rights-of-way and encroachments; (c) location of
encroachments, if any, upon adjoining property, or from adjoining property, upon
the Land; (d) state the zoning classification of the Land; (e) be certified as
of the date of the Survey to CCP, the Purchaser, the Title
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Company, and any third-party lender designated by Purchaser; (f) legibly
identify any and all recorded matters shown on said Survey by appropriate volume
and page recording references; (g) show the location and names of all adjoining
streets and the distance to the nearest streets intersecting the streets that
adjoin the Land; (h) be satisfactory to (and updated from time to time as may be
required by) the Title Company so as to permit it to delete the standard
exception for survey matters and replace it with an exception for the matters
shown on the Survey; and (i) include a written Surveyor's Certification in form
acceptable to Purchaser.
"Title Commitment" shall mean a current commitment or current
commitments issued by the Title Company to Purchaser pursuant to the terms of
which the Title Company shall commit to issue the Title Policy to Purchaser in
accordance with the provisions of this Agreement, and reflecting all matters
which would be listed as exceptions to coverage on the Title Policy.
"Title Company" shall mean Fidelity National Title Insurance Company.
"Title Policy" shall mean an ALTA Extended Coverage Owner's Policy (or
policies) of Title Insurance (10/17/92 Form), or comparable state promulgated
policies, with liability in the aggregate amount of the Purchase Price, issued
by the Title Company, insuring title to the fee interest in the Real Property in
Purchaser, subject only to the Permitted Exceptions and to the standard printed
exceptions included in the ALTA standard form owner's extended coverage policy
of title insurance, with the following modifications: (a) the exception for
survey matters shall be deleted and replaced by an exception for the matters
shown on the Survey; (b) the exception for ad valorem taxes shall reflect only
taxes for the current and subsequent years; (c) any exception as to parties in
possession shall be limited to rights of either Seller in possession; and (d)
there shall be no general exception for visible and apparent easements or roads
and highways or similar items (with any exception for visible and apparent
easements or roads and highways or similar items to be specifically referenced
to and shown on the Survey and also identified by applicable recording
information).
"Warranties" shall mean all warranties and guaranties with respect to
the Real Property or Personal Property, whether express or implied, which any
Seller now holds or under which any Seller is the beneficiary, to the extent the
same are assignable by such Seller.
"Wyoming Incarceration Agreement" shall mean (ii) that certain Contract
between CCS and State of Wyoming, Department of Corrections, dated July 6, 2001,
as amended by Amendment Number One dated April 5, 2002, Amendment Number Two
dated June 27, 2002 and Amendment Number Three, undated.
ARTICLE II
AGREEMENT TO SELL AND PURCHASE
2.1 Agreement to Sell and Purchase. On the Closing Date, provided this
Agreement has not terminated pursuant to the provisions of Section 4.3 below,
Sellers shall sell, convey, assign, transfer and deliver to Purchaser and
Purchaser shall purchase, acquire and accept from
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Sellers, the Property, and Sellers shall cause the Incarceration Agreements to
be assigned to Purchaser, for the Purchase Price and subject to the terms and
conditions of this Agreement.
ARTICLE III
PURCHASE PRICE
3.1 Payment of Xxxxxxx Money and Purchase Price. Purchaser shall
deposit the Initial Xxxxxxx Money with the Title Company within three (3)
Business Days following the execution and delivery of this Agreement and the
Escrow Agreement by all parties. Provided this Agreement has not terminated
pursuant to Section 4.3 hereof, Purchaser shall deposit the Additional Xxxxxxx
Money with the Title Company no later than the first Business Day following the
expiration of the Review Period. The Purchase Price shall be paid by Purchaser
delivering to the Title Company on the Closing Date, Federal Reserve wire
transfer funds in the sum equal to the Purchase Price, less the Xxxxxxx Money,
subject to adjustment as herein provided.
ARTICLE IV
ITEMS TO BE
FURNISHED TO PURCHASER BY SELLERS
4.1 Due Diligence Materials. Sellers have previously provided to
Purchaser the RFP Materials. Within five (5) Business Days following the
Effective Date (or within such other time as may be specified on Schedule 4.1
hereto), Sellers shall deliver to Purchaser (or cause Manager to deliver on
behalf of Sellers) the additional materials set forth on Schedule 4.1 hereto.
4.2 Rights of Access; Inspection.
a. From and after the date hereof, Purchaser and its
representatives, subject to the requirements set forth below, shall have the
right to inspect the Property and the books, records and files regarding the
operation of the Property that are located at the Property, and to meet with,
and obtain information from, the Manager and its representatives, and to conduct
environmental and engineering tests at the Property.
b. Purchaser (i) shall give Sellers at least two (2) business
days' prior notice (which, notwithstanding the provisions of Section 11.2, may
be given by telephone) of Purchaser's request to enter the Property, (ii) shall
at all times conduct inspections and tests in compliance with applicable Laws,
in a manner so as not to cause damage, loss, cost or expense to Sellers or the
Property or unreasonably interfere with Sellers' or Managers' business
operations or constitute a safety or security hazard, as reasonably determined
by Sellers, (iii) shall promptly restore the Property to its condition
immediately preceding Purchaser's inspections and tests, (iv) shall keep the
Property free and clear of any mechanic's liens or materialman's liens arising
from such inspections and tests, (v) shall allow a representative of Sellers to
accompany Purchaser at all times when Purchaser is at the Property and/or when
Purchaser meets with Manager and its employees, (vi) shall, if this Agreement is
terminated pursuant to the provisions of Section 4.3 below, promptly after such
termination provide Sellers, at no cost or expense to Sellers, with copies of
all drafts or final engineering and architectural reports, environmental reports
and lab analyses, appraisals, construction and renovation estimates commissioned
and received by Purchaser in connection with Purchaser's inspections and tests
(collectively, the
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"Inspection Reports"), other than documents that are subject to any
attorney-client privilege, and (vii) shall keep the Inspection Reports and the
contents thereof confidential, except to the extent such information is a matter
of public record or is provided in other sources readily available to the real
estate industry (other than as a result of disclosure by Purchaser) or to the
extent that such disclosure is compelled by law or by regulatory or judicial
process, provided, however, that Purchaser may disclose such information to its
agents, advisors, consultants, members, affiliates, lenders, advisors, attorneys
and accountants (collectively, "Transaction Parties"), so long as such
Transaction Parties are informed by Purchaser of the confidential nature of such
information and are directed by Purchaser to treat such information
confidentially and to use such information only in connection with the
transactions contemplated by this Agreement (it being agreed that Purchaser's
obligations under this Section 4.2(b) shall survive the termination of this
Agreement). Purchaser and Seller agree to work together in good faith to
establish appropriate procedures for interviews and interactions with Seller's
or Manager's employees at the Property, in the light of the nature of the
Property as a correctional facility and any governmental requirements or
limitations which may apply.
c. Purchaser shall not, and shall not permit its employees,
consultants, engineers and agents to conduct any soil tests or sampling or any
boring, digging, drilling or other physical intrusion of the Property or any of
the Improvements (collectively, "Testing"), except at reasonable times and with
the prior written notice to Sellers and, with respect to any invasive testing
not customarily included in a Phase I Environmental Site Assessment, upon the
prior written consent of Sellers, which shall not be unreasonably withheld. If
Purchaser undertakes any Testing, Purchaser shall furnish to Sellers property
damage and liability insurance policies in form and amounts reasonably
acceptable to Sellers prior to commencing such Testing and shall, upon
completion thereof, at Purchaser's sole cost and expense, promptly restore the
Property to its condition existing prior to such Testing.
d. Purchaser hereby agrees to protect, defend, indemnify and
hold harmless Sellers, each of their respective parents and affiliates and each
member, manager, officer, director and shareholder of each Seller and each such
parent or affiliate from and against any and all liabilities, actions, suits,
mechanics' liens, judgments, losses, costs, damages, expenses (including,
without limitation, attorneys' fees and expenses), claims and demands of any
nature whatsoever (other than those arising out of a pre-existing condition at
the Property and except to the extent attributable to the activities, conduct or
actions of Sellers or Manager) suffered or incurred by or made against Sellers,
its employees, agents, successors or assigns, arising out of or in any way
relating to the acts or omissions of Purchaser or its agents in conducting such
inspections, Testing or other activities by or on behalf of Purchaser. The
provisions of this Section 4.2(d) shall survive the Closing or any earlier
termination of this Agreement.
4.3 Right to Proceed. Unless Purchaser delivers the notice described in
the following sentence of this Section 4.3, at 11:59 p.m. on the last day of the
Review Period this Agreement shall automatically terminate and be rendered null
and void, all Xxxxxxx Money shall be immediately returned to Purchaser and
thereafter neither party shall have any further obligation or liability
hereunder, except for rights or obligations that, pursuant to the provisions of
this Agreement, are expressly made to survive the termination hereof. Provided,
however, if, on or before the expiration of the Review Period, Purchaser
provides to Seller a written notice (a
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"Non-termination Notice") that Purchaser has elected to proceed with the
purchase contemplated by this Agreement, and stating (i) whether to the Best of
Knowledge of Purchaser, either Seller is in default hereunder, and (ii) whether
Purchaser waives any such default(s), then, subject to the conditions to
Purchaser's obligations set forth herein and subject to the provisions of the
following sentence, this Agreement shall not terminate, and the Xxxxxxx Money
shall be nonrefundable, except as otherwise specifically set forth herein. In
the event the Non-termination Notice states that either Seller is in default
hereunder and that Purchaser does not waive any default identified therein,
Sellers shall have the one-time right to terminate this Agreement by written
notice delivered to Seller not later than the first (1st) Business Day following
the date of the Non-termination notice, whereupon this Agreement shall terminate
on the terms set forth in the first sentence of this Section 4.3.
ARTICLE V
REPRESENTATIONS, WARRANTIES, COVENANTS AND AGREEMENTS
5.1 Representations and Warranties of Sellers. To induce Purchaser to
enter into this Agreement and to purchase the Property, and except as otherwise
set forth on Schedule 5.1 annexed hereto, Sellers represent and warrant to, and
covenant with, Purchaser as follows:
a. CCP has and at the Closing will have, and will convey,
transfer and assign to Purchaser marketable and insurable title to the Land,
free and clear of any deeds of trust, mortgages, liens, encumbrances, leases,
tenancies, licenses, chattel mortgages, conditional sales agreements, security
interests, covenants, conditions, restrictions, judgments, rights-of-way,
easements, encroachments and claims except the Permitted Exceptions and the
Lease. The Lease will be terminated at Closing.
b. Each Seller has duly and validly authorized and executed
this Agreement, and has full right, title, power and authority to enter into
this Agreement and to consummate the transactions provided for herein, and the
joinder of no person or entity will be necessary to convey the Property fully
and completely to Purchaser at Closing. Each Seller is a limited liability
company duly organized, validly existing and in good standing under the laws of
the State of Delaware. The consummation of the transactions contemplated herein
does not require the approval of either Seller's members or directors or any
third party, except such approvals as each Seller has obtained and except for
the consent of the County and the State of Wyoming pursuant to the Incarceration
Agreements. The execution by each Seller of this Agreement and the consummation
by each Seller of the transactions contemplated hereby (x) do not, and at the
Closing will not, result in a breach of any of the terms or provisions of, or
constitute a default or a condition which upon notice or lapse of time or both
would ripen into a default under, either Seller's governance documents or any
indenture, agreement, instrument or obligation to which either Seller is a party
or by which the Property or any portion thereof is bound and (y) do not
constitute a violation of any Laws, order, rule or regulation applicable to
either Seller or any portion of the Property of any court or of any federal,
state or municipal regulatory body or administrative agency or other
governmental body having jurisdiction over either Seller or any portion of the
Property.
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c. There are no adverse or other parties in possession of the
Property or of any part thereof, other than Manager pursuant to the Management
Agreement and certain parties to the Operating and Service Agreements. Sellers
have not granted to any party any license, lease or other right relating to the
use or possession of the Property, other than pursuant to the Lease, the
Management Agreement and the Operating and Service Agreements. All of the
Operating and Service Agreements are described on Exhibit D annexed hereto and
made a part hereof.
d. To the Best Knowledge of Sellers, there is no material
inaccuracy in any of the Due Diligence Materials as of and with respect to the
respective periods to which such materials relate nor are any of the Due
Diligence Materials untrue, incomplete or inaccurate in any material respect.
e. No notice has been received by either Seller from any
insurance company that has issued a currently effective policy with respect to
any portion of the Property or from any board of fire underwriters (or other
body exercising similar functions), claiming any defects or deficiencies or
requiring the performance of any repairs, replacements, alterations or other
work. No notice has been received by either Seller from any such insurance
company that any of such policies will not be renewed, or will be renewed only
at a higher premium rate than is presently payable therefor.
f. No pending condemnation, eminent domain, assessment or
similar proceeding or charge affecting the Property or any portion thereof
exists; Sellers have not heretofore received any notice, and have no knowledge,
that any such proceeding or charge is contemplated; and Sellers have not
received any notice of a proposed increase in the assessed valuation of the
Property.
g. To the Best Knowledge of Sellers, all Improvements
(including all utilities) have been, or as of the Closing will be, substantially
completed in accordance with the plans and specifications approved by the
governmental authorities having jurisdiction to the extent applicable and are
transferable to Purchaser without additional cost. To the Best Knowledge of
Sellers, permanent certificates of occupancy, all licenses, permits,
authorizations and approvals required by all governmental authorities having
jurisdiction, and the requisite certificates of the local board of fire
underwriters (or other body exercising similar functions) have been issued for
the Improvements, and, as of the Closing, were required, all of the same will be
in full force and effect. To the Best Knowledge of Sellers, the Improvements, as
designed and constructed, do not fail to comply in any material respect with any
statutes, restrictions, regulations and ordinances applicable thereto, including
but not limited to the Americans with Disabilities Act and Section 504 of the
Rehabilitation Act of 1973, as applicable.
h. To the Best Knowledge of Sellers the existing water, sewer,
gas and electricity lines, storm sewer and other utility systems on the Land are
adequate to serve the current utility needs of the Property; all utilities
required for the operation of the Improvements enter the Land through adjoining
public streets or through adjoining private land in accordance with valid public
or private easements that will inure to the benefit of Purchaser; all approvals,
licenses and permits required for said utilities have been obtained and are in
full force and effect;
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and all of said utilities are installed and operating and all installation and
connection charges have been paid in full.
i. To the Best Knowledge of Sellers, there are not any
structural or latent defects in any of the buildings or other Improvements
constituting the Property. To the Best Knowledge of Sellers, neither the
Improvements, the heating, electrical, plumbing and drainage at, or servicing,
the Property, or the facilities and equipment relating thereto are or, as of the
Closing, will be, in other than good condition and working order or will be
adequate in quantity and quality for the normal operation of the Property. To
the Best Knowledge of Sellers, no part of the Property has been destroyed or
damaged by fire or other casualty. To the Best Knowledge of Sellers, there are
no unsatisfied requests for repairs, restorations or alterations with regard to
the Property from any person, entity or authority, including but not limited to
any lender, insurance provider or governmental authority.
x. Xxxxxxx have received no written notice from any third
party alleging that the location, construction, occupancy, operation and use of
the Property (including the Improvements) violate any applicable law, statute,
ordinance, rule, regulation, order or determination of any governmental
authority or any board of fire underwriters (or other body exercising similar
functions), or any restrictive covenant or deed restriction (recorded or
otherwise) affecting the Property or the location, construction, occupancy,
operation or use thereof, including, without limitation, all applicable zoning
ordinances and building codes, flood disaster laws and health and environmental
laws and regulations, the Americans with Disabilities Act and Section 504 of the
Rehabilitation Act of 1973, as applicable.
k. No work has been performed or is in progress at the
Property, and no materials will have been delivered to the Property that might
provide the basis for a mechanic's, materialmen's or other lien against the
Property or any portion thereof, or amounts due for such work and material shall
have been paid or discharged to Purchaser's satisfaction as of Closing.
l. There exist no material service contracts, management or
other agreements applicable to the Property to which either Seller is a party,
other than the Lease, the Management Agreement, the Incarceration Agreements,
the Operating and Service Agreements and the Permitted Exceptions.
m. Neither Seller is in default in any manner which would
result in a material adverse effect on either Seller under the Incarceration
Agreements, or any of the covenants, conditions, restrictions, rights-of-way or
easements of record affecting the Property or any portion thereof.
n. To the Best Knowledge of Sellers, there are no actions,
suits or proceedings pending or threatened against or affecting the Property or
any portion thereof, or relating to or arising out of the ownership or operation
of the Property, or by any federal, state, county or municipal department,
commission, board, bureau or agency or other governmental instrumentality.
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o. To the Best Knowledge of Sellers, the Property has free and
unimpeded access to presently existing public highways and/or roads (either
directly or by way of perpetual easements), and all approvals necessary therefor
have been obtained and no fact or condition exists which would result in the
termination of the current access from the Property to any presently existing
public highways and/or roads adjoining or situated on the Property.
p. There are no attachments, executions, assignments for the
benefit of creditors, or voluntary or involuntary proceedings in bankruptcy or
under any other debtor relief laws contemplated by or pending or, to the Best
Knowledge of Sellers, threatened against either Seller or the Property.
q. To the Best Knowledge of Sellers, no Hazardous Materials
have been installed, used, generated, manufactured, treated, handled, refined,
produced, processed, stored or disposed of, or otherwise present in, on or under
the Property. To the Best Knowledge of Sellers, the activities undertaken on the
Property would not cause (i) the Property to become a hazardous waste treatment,
storage or disposal facility within the meaning of, or otherwise bring the
Property within the ambit of RCRA or any Hazardous Materials Law, (ii) a release
or threatened release of Hazardous Materials from the Property within the
meaning of, or otherwise bring the Property within the ambit of, CERCLA or XXXX
or any Hazardous Materials Law or (iii) the discharge of Hazardous Materials
into any watercourse, body of surface or subsurface water or wetland, or the
discharge into the atmosphere of any Hazardous Materials which would require a
permit under any Hazardous Materials Law. To the Best Knowledge of Sellers, the
activities undertaken with respect to the Property would not cause a violation
or support a claim under RCRA, CERCLA, XXXX or any Hazardous Materials Law. To
the Best Knowledge of Sellers, no investigation, administrative order,
litigation or settlement with respect to any Hazardous Materials is in existence
with respect to the Property, nor is any of the foregoing threatened. No notice
has been received by Sellers from any entity, governmental body or individual
claiming any violation of any Hazardous Materials Law, or requiring compliance
with any Hazardous Materials Law, or demanding payment or contribution for
environmental damage or injury to natural resources. Sellers have not obtained
and, to the Best Knowledge of Sellers, are not required to obtain, and Sellers
have no knowledge of any reason Purchaser will be required to obtain, any
permits, licenses, or similar authorizations to occupy, operate or use the
Improvements or any part of the Property by reason of any Hazardous Materials
Law.
r. The Property includes all items of property, tangible and
intangible, currently used by Sellers in connection with the operation of the
Property, other than property expressly excluded from the definition of the
Property. The Real Property constitutes all real property in the County owned by
CCP or any affiliates of CCP and neither CCP, nor any of its affiliates, has any
contract, agreement or option to purchase any other real property in the County.
s. The Sellers will deliver, or cause Manager to deliver, to
Purchaser within five (5) Business Days after the Effective Date: (i) a schedule
setting forth the names and titles of all persons employed at the Property, and
the annual rate of compensation (including bonuses) being paid to each such
employee as of the most recent pay date, and (ii) a schedule containing a
summary of the terms of each employment, bonus, deferred compensation, pension,
stock option,
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stock appreciation right, profit-sharing or retirement plan, arrangement or
practice, and each other agreement or fringe benefit plan, arrangement or
practice, whether formal or informal, whether legally binding or not, and
whether affecting one or more of the employees at the Property. Neither, the
Sellers nor, to the Best Knowledge of Sellers, the Manager, has any commitment,
whether formal or informal and whether legally binding or not, (a) to create any
additional such agreement, plan, arrangement or practice; (b) to modify or
change any such agreement, plan, arrangement or practice; or (c) to maintain for
any period of time any such agreement, plan, arrangement or practice, except as
shall be described in said schedules, which shall also contain an accurate and
complete description of the funding policies (and commitments, if any) with
respect to each such existing plan, arrangement or practice. Within five (5)
Business Days from the Effective Date, Sellers shall deliver or cause to be
delivered to Purchaser copies of all such agreements, plans and/or arrangements.
t. Prior to the Closing and subject to the provisions of the
last sentence of Section 4.2.b. hereof, Sellers shall use reasonable efforts to
cause Manager to use all reasonable efforts to cooperate with and assist
Purchaser in attempting to make available to Purchaser those persons employed at
the Property which Purchaser and its representatives desire to interview. In
addition, Sellers will use reasonable efforts to cause Manager to cooperate with
Purchaser and assist with respect to Purchaser's efforts to reach an agreement
with any such employees of Manager as Purchaser shall desire to employ so that
such employees, on terms mutually acceptable to Purchaser and such employees,
shall become employees of Purchaser following the Closing. Neither Sellers nor,
to the Best Knowledge of Sellers, Manager, is a party to any contract or
agreement (other than this Agreement) which would require Purchaser to hire, or
subject Purchaser to liability if it terminated or did not hire, any employee at
the Property, or which would require Purchaser to pay or provide, or subject
Purchaser to liability if Purchaser did not pay or provide, any employee
benefits to any such employee for periods prior to or after the Closing
(including any and all employee benefits and any compensatory, over-time,
vacation, sick or holiday pay). CCS and the Manager, as applicable, will be
fully responsible for all accrued but unpaid compensation, including, without
limitation, wages, over-time, accrued vacation or sick leave, of persons
employed at the Property as of the Closing, and CCS shall, and Sellers shall
insure that Manager will, make timely payment of such compensation to such
employees consistent with normal compensation and salary payment schedules of
CCS and the Manager, as applicable. Purchaser will be responsible for payment of
compensation to employees of Purchaser accruing from and after the Closing.
u. CCS and, to the Best Knowledge of Sellers, Manager have
complied in all respects with all applicable federal, state and local laws
relating to employment of labor, including the provisions of the Employee
Retirement Income Security Act of 1974 ("ERISA") and any applicable laws
relating to wages, hours, collective bargaining, and the payment of social
security taxes; Neither CCS nor, to the Best Knowledge of Sellers, Manager, is
liable for any arrears of wages or benefits or any penalties for failure to
comply with any of the foregoing; and there are no controversies pending or
threatened between Sellers or Manager and their respective employees. CCS and
Manager shall be responsible for all compensation of persons covered by the
Worker Adjustment and Restraining Notification Act which accrue prior to Closing
Date. If an event giving rise to such notice requirement occurs after the
Closing Date, Purchaser shall be responsible for providing such notice to
affected employees.
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v. Neither Seller has any employees.
w. The Incarceration Agreements are the entire agreement
between either Seller and the County or the State of Wyoming, as the case may
be, pertaining to the Property. CCS, the County and the State of Wyoming, as the
case may be, are the sole parties to the Incarceration Agreements. There are no
further amendments, modifications, supplements, arrangements, side letters or
understandings, oral or written, of any sort, modifying, amending, altering,
supplementing or changing the terms of the Incarceration Agreements. All
obligations of each party under the Incarceration Agreements have been performed
and no event has occurred and no condition exists that, with the giving of
notice or the lapse of time or both, would constitute a default by any party
under the Incarceration Agreements.
x. There is no currently effective assignment, transfer or
hypothecation by CCS of the Incarceration Agreements, or any interest therein or
any right to receive payments thereunder.
y. The Lease is the entire agreement between CCS and CCP
pertaining to the Property. CCS and CCP are the sole parties to the Lease.
Neither CCP nor CCS has assigned, transferred, or hypothecated the Lease, or any
interest therein. The Lease will be terminated as of the Closing Date.
5.2 Covenants and Agreements of Sellers. Sellers covenant and agree
with Purchaser, from the Effective Date until the Closing or earlier termination
of this Agreement:
a. Sellers shall cause Manager to: (i) operate and maintain
the Property in the ordinary course of Manager's business and in the same manner
as currently operated and maintained; (ii) keep the Incarceration Agreements in
full force and effect, enforce same, and not accept any advance payments under
the Incarceration Agreements; and (iii) maintain the Improvements and the
Personal Property in its current good condition and repair, normal wear and tear
excepted.
x. Xxxxxxx shall cause to be maintained in full force and
effect fire and extended coverage insurance upon the Property and public
liability insurance with respect to damage or injury to persons or property
occurring on or relating to operation of the Property as currently maintained.
x. Xxxxxxx shall cause Manager to pay when due all bills and
expenses of the Property. Sellers shall not enter into or assume or allow
Manager to enter into or assume any new contracts or agreements with regard to
the Property which are in addition to or different from those furnished and
disclosed to Purchaser pursuant to Section 5.1(c), other than service contracts
that are terminable on not more than thirty (30) days' notice or contracts which
do not extend beyond the Closing Date.
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x. Xxxxxxx shall not create or permit to be created any liens,
easements or other conditions affecting any portion of the Property or the uses
thereof without the prior written consent of Purchaser.
x. Xxxxxxx shall not remove, or allow to be removed, any
Personal Property or Fixtures from the Land or Improvements without replacing
same with substantially similar items of equal or greater value and repairing
the damage, if any, to the Property as a result of such removal.
x. Xxxxxxx shall use all commercially reasonable good faith
efforts to obtain the consent of the County to the assignment of the County
Incarceration Agreement to Purchaser.
x. Xxxxxxx shall not, by act or omission of Sellers or their
agents, allow or cause any of Sellers' representations or warranties contained
herein to become untrue or inaccurate in any material respect.
5.3 Representations and Warranties of Purchaser. To induce Sellers to
enter into this Agreement and to sell the Property, Purchaser represents and
warrants to Sellers (subject to the satisfaction of the conditions in Section
6.1 e.) as follows:
a. Purchaser has duly and validly authorized and executed this
Agreement, and has full right, title, power and authority to enter into this
Agreement and to consummate the transactions provided for herein, and the
joinder of no person or entity will be necessary to purchase the Property from
Sellers at Closing. Purchaser is a corporation duly organized, validly existing
and in good standing under the laws of the State of Maryland.
b. The execution by Purchaser of this Agreement and the
consummation by Purchaser of the transactions contemplated hereby do not, and at
the Closing will not, result in a breach of any of the terms or provisions of,
or constitute a default or a condition which upon notice or lapse of time or
both would ripen into a default under, any indenture, agreement, instrument or
obligation to which Purchaser is a party; and does not, and at the Closing will
not, constitute a violation of any Laws, order, rule or regulation applicable to
Purchaser of any court or of any federal, state or municipal regulatory body or
administrative agency or other governmental body having jurisdiction over
Purchaser.
5.4 Covenants and Agreements of Purchaser. Purchaser covenants and
agrees with Sellers, from the Effective Date until the Closing or earlier
termination of this Agreement:
a. Purchaser shall cooperate with Seller in good faith, in
Seller's efforts to obtain the consent of the County set forth in Section 5.2.f
above.
b. Purchaser will notify Sellers of the failure of either of
the conditions set forth in 6.1.e. with reasonable promptness after Purchaser
has determined that such condition will not be satisfied.
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5.5 Indemnities.
a. Subject to the limitations set forth in Section 5.5(c)
below, from and after the Closing, each of Sellers shall indemnify, defend and
hold Purchaser, each of Purchaser's respective parents and affiliates, and each
member, manager, officer, director and shareholder of Purchaser and such parents
and affiliates, from and against any and all loss, cost, damage and expense
(including, without limitation, reasonable attorneys' fees) incurred by any of
the indemnitees as a result of any material inaccuracy in any of the
representations and warranties of Sellers contained herein. Notwithstanding the
foregoing, to the extent of any such losses costs, damages or expenses are
covered by Purchaser's policy of title insurance applicable to the Property,
Purchaser shall look solely to said policy of title insurance to recover such
costs, damages or expenses.
b. Subject to the limitations set forth in Section 5.5(c)
below, from and after the Closing, Purchaser shall indemnify, defend and hold
harmless each of Sellers, each of their respective parents and affiliates, and
each member, manager, officer, director and shareholder of each of Sellers and
such parents and affiliates, from and against any and all loss, cost, damage and
expense (including, without limitation, reasonable attorneys' fees) incurred by
any of the indemnitees as a result of any material inaccuracy in any of the
representations and warranties of Purchaser contained herein.
c. Notwithstanding the foregoing, (i) neither Party shall have
any liability under the provisions of this Section 5.4 unless and until the
aggregate amount of claims of the other Party thereunder is in excess of
$100,000; (ii) each Party's maximum liability under the provisions of this
Section 5.4 shall be $3,000,000; and (iii) any claim under this Section 5.5 must
be made within fifteen (15) months of the Closing Date.
ARTICLE VI
CONDITIONS TO OBLIGATIONS
6.1 Conditions to Purchaser's Obligations. The obligations of Purchaser
to purchase the Property from Sellers and to consummate the transactions
contemplated by this Agreement are subject to the satisfaction, as of the
Closing Date (or such other time as specified below), of each of the following
conditions:
a. All of the representations and warranties of Sellers set
forth in this Agreement shall be true in all material respects as of the Closing
Date.
x. Xxxxxxx shall have delivered, performed, observed and
complied, in all material respects, with all of the items, instruments,
documents, covenants, agreements and conditions required by this Agreement to be
delivered, performed, observed and complied with by it prior to, or as of, the
Closing.
c. Neither Seller shall be in receivership or dissolution or
have made any assignment for the benefit of creditors, or shall have admitted in
writing its inability to pay its debts as they mature, and shall not have been
adjudicated a bankrupt, and shall not have filed a petition in voluntary
bankruptcy, a petition or answer seeking reorganization or an arrangement
16
with creditors under the federal bankruptcy law or any other similar law or
statute of the United States or any state and no such petition shall have been
filed against either Seller.
d. No material adverse change shall have occurred with respect
to the condition, financial or otherwise, of the Property; provided, however,
that the following occurrences shall not be deemed to be such a material adverse
change: (x) the failure of the State of Wyoming to approve the sale of the
Property to Purchaser, pursuant to Section 7.n. of the Wyoming Incarceration
Agreement or (y) a reduction in the occupancy level of the Property between the
date hereof and the Closing Date, unless such reduction is indicative of a
material adverse change in the long-term prospects for occupancy of the
Property.
e. Prior to the expiration of the Review Period, Purchaser
shall have obtained (i) the authorization and approval of its Board of Directors
for the acquisition of the Property on the terms and conditions set forth herein
and any financing relating thereto, and (ii) such consents, approvals and
amendments and/or increases to its existing credit facilities as are necessary
or desirable in connection with the acquisition of the Property pursuant to the
terms hereof.
f. Neither the Property nor any part thereof or interest
therein shall have been taken by execution or other process of law in any action
prior to Closing.
g. No material portion of the Property shall have been
destroyed by fire or casualty.
h. No material condemnation, eminent domain or similar
proceedings shall have been commenced or threatened with respect to any portion
of the Property.
i. Seller shall have obtained the consent of the County to the
assignment of the County Incarceration Agreement.
6.2 Failure of Conditions to Purchaser's Obligations. In the event any
one or more of the conditions to Purchaser's obligations are not satisfied or
waived in whole or in part at any time prior to or as of the Closing, Purchaser,
at Purchaser's option, shall be entitled to one of the following two remedies,
which shall be Purchaser's exclusive remedies (subject to the last sentence of
this Section 6.2): (a) terminate this Agreement by giving written notice thereof
to Sellers, whereupon all Xxxxxxx Money shall be immediately refunded to
Purchaser and the Parties shall have no further obligations or liabilities
hereunder, except for those provisions that expressly survive the termination of
this Agreement; or (b) waive such condition(s) and proceed to Closing hereunder,
without any change in the purchase price or modification of any of the other
terms of this Agreement. Provided, should the failure of any conditions to
Purchaser's obligations constitute default by Sellers hereunder, the provisions
of Section 9.1 shall apply.
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ARTICLE VII
PROVISIONS WITH RESPECT TO THE CLOSING
7.1 Sellers' Closing Obligations. At the Closing, Sellers shall furnish
and deliver, or cause to be furnished and delivered, to Purchaser the following:
a. The Deed, Xxxx of Sale, Certificate of Non-Foreign Status
and Closing Certificate.
b. An assignment of those of the Operating and Service
Agreements marked with an asterisk on Exhibit D and of the Incarceration
Agreements, with the written approval and consent of the County and the State of
Wyoming, together with an estoppel certificate from the County in the form of
Schedule 7.1 annexed hereto.
c. Evidence reasonably satisfactory to Purchaser and the Title
Company that the Lease and Management Agreement have each been terminated as of
the Closing, and that neither CCS nor Manager has any further claims or rights
thereunder which could adversely affect Purchaser or the Property.
d. Search Reports, dated not more than fifteen (15) days prior
to Closing, evidencing no UCC-1 Financing Statements or other filings in the
name of either Seller with respect to the Property which will remain on the
Property after the Closing.
e. Such affidavits or letters of indemnity from Sellers as the
Title Company shall require in order to omit from the Title Insurance Policy all
exceptions for unfiled mechanic's, materialmen's or similar liens.
f. Any and all transfer declarations or disclosure documents,
duly executed by the appropriate parties, required in connection with the Deed
by any state, county or municipal agency having jurisdiction over the Property
or the transactions contemplated hereby.
g. Such instruments or documents as are reasonably necessary,
or reasonably required by Purchaser or the Title Company, to evidence the status
and capacity of each Seller and the authority of the person or persons who are
executing the various documents on behalf of each Seller in connection with the
purchase and sale transaction contemplated hereby.
h. Escrow closing instructions in customary form reasonably
satisfactory to Purchaser and Seller.
i. Such other documents as are reasonably required by
Purchaser to carry out the terms and provisions of this Agreement.
7.2 Purchaser's Closing Obligations. At the Closing, Purchaser shall
furnish and deliver to Sellers the following:
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a. Federal Reserve wire transfer funds to the Title Company
representing the portion of the Purchase Price due in accordance with Section
3.1 herein.
b. Such instruments or documents as are reasonably necessary,
or reasonably required by Sellers or the Title Company, to evidence the status
and capacity of Purchaser and the authority of the person or persons who are
executing the various documents on behalf of Purchaser in connection with the
purchase and sale transaction contemplated hereby.
c. An assumption of the Incarceration Agreements and of the
Operating and Service Agreements being assigned by Seller.
d. Escrow closing instructions in customary form reasonably
satisfactory to Purchaser and Sellers.
e. Such other documents as are reasonably required by Sellers
to carry out the terms and provisions of this Agreement.
ARTICLE VIII
EXPENSES OF CLOSING
8.1 Adjustments. Taxes, assessments, water or sewer charges, gas,
electric, telephone or other utilities, operating expenses, rents, income or
other normally proratable items shall be adjusted between the parties as of the
Closing Date. To the extent that the actual amount of any of such item is
unknown as of the Closing Date, such items shall be prorated based on the
Parties' reasonable good faith best estimates thereof, and a final
reconciliation of such adjustments shall be made by the Parties within ninety
(90) days after the Closing Date.
8.2 Closing Costs. Purchaser shall pay (a) all title examination fees
and premiums for the Title Policy, (b) the cost of the Survey; (c) any and all
state, municipal or other documentary or transfer taxes payable in connection
with the delivery of any instrument or document provided in or contemplated by
this Agreement; and (d) the charges for or in connection with the recording
and/or filing of any instrument or document provided herein or contemplated by
this Agreement. Each party shall pay (a) their respective legal, accounting and
other professional fees and expenses and the cost of all opinions, certificates,
instruments, documents and papers required to be delivered, or to cause to be
delivered, by such party hereunder, including, without limitation, the cost of
performance by such party of its obligations hereunder; and (b) all other costs
and expenses which are required to be paid by such party pursuant to other
provisions of this Agreement.
8.3 Commissions/Broker's Fees. Sellers hereby represent and warrant to
Purchaser that neither of them has contacted any real estate broker, finder or
any other party in connection with this transaction, and that neither of them
has taken any action which would result in any real estate broker's, finder's or
other fees being due or payable to any party with respect to the transaction
contemplated hereby. Purchaser hereby represents and warrants to Sellers that
Purchaser has not contacted any real estate broker, finder or any other party in
connection with this transaction, and that it has not taken any action which
would result in any real estate broker's, finder's or other fees being due or
payable to any party with respect to the transaction
19
contemplated hereby. Each Party hereby indemnifies and agrees to hold the other
Party harmless from any loss, liability, damage, cost or expenses (including
reasonable attorneys' fees) resulting to such other Party by reason of a breach
of the representation and warranty made by such Party herein.
8.4 The provisions of this Article VIII shall survive the Closing or
the earlier termination of this Agreement.
ARTICLE IX
DEFAULT AND REMEDIES
9.1 Sellers' Default; Purchaser's Remedies.
a. Sellers' Default. Sellers shall be deemed to be in default
hereunder upon the occurrence of one of the following events: (i) any of either
Seller's warranties or representations set forth herein shall be untrue in any
material respect when made or, as modified by the Closing Certificate, at
Closing; or (ii) either Seller shall fail to meet, comply with, or to perform
any material covenant, agreement or obligation (or any one or more covenants,
agreements or obligations which are material on a collective basis) on its part
required within the time limits and in the manner required in this Agreement,
which, in either of such events, is not cured by Sellers within ten (10)
calendar days following receipt by Sellers of written notice of default from
Purchaser.
b. Purchaser's Remedies. In the event either Seller shall be
in default hereunder, Purchaser may, at Purchaser's sole option, do any one or
more of the following: (i) terminate this Agreement by giving written notice
delivered to Sellers on or before the Closing, whereupon all Xxxxxxx Money shall
be immediately refunded to Purchaser and the parties shall have no further
obligations or liabilities hereunder, except for those provisions that expressly
survive the termination of this Agreement; and/or (ii) enforce specific
performance of this Agreement against Sellers, including recovery of Purchaser's
reasonable costs and attorneys fees in connection therewith; and/or (iii)
exercise any other right or remedy Purchaser may have at law or in equity for
the recovery of damages by reason of such default including, but not limited to,
the recovery of reasonable attorneys' fees incurred by Purchaser in connection
herewith; provided, however, Purchaser's recovery under this Section 9.1.b.(iii)
shall not exceed $1,000,000.
9.2 Purchaser's Default; Sellers' Remedies.
a. Purchaser's Default. Purchaser shall be deemed to be in
default hereunder upon the occurrence of one of the following events: (i) any of
Purchaser's warranties or representations set forth herein shall be untrue in
any material respect when made or at Closing; or (ii) Purchaser shall fail to
meet, comply with, or perform any material covenant, agreement or obligation (or
any one or more covenants, agreements or obligations which are material on a
collection basis) on its part required within the time limits and in the manner
required in this Agreement, which, in either of such events (except for
Purchaser's failure to pay the balance of the Purchase Price on the date which
is 15 days after the expiration of the Review Period, as to
20
which Purchaser shall receive no notice or grace period), is not cured by
Purchaser within ten (10) calendar days following receipt by Purchaser of
written notice of default from Sellers; or (iii) Purchaser shall be in
receivership or dissolution or shall have made any assignment for the benefit of
creditors, or shall have admitted in writing its inability to pay its debts as
they mature, or shall have been adjudicated a bankrupt, or shall have filed a
petition in voluntary bankruptcy, a petition or answer seeking reorganization or
an arrangement with creditors under the federal bankruptcy law or any other
similar law or statute of the United States or any State, or any such petition
shall have been filed against it.
x. Xxxxxxx' Remedies. In the event Purchaser shall be in
default hereunder; Purchaser and Sellers agree that it would be extremely
difficult and impracticable to determine the amount and extent of detriment to
Sellers. Purchaser and Sellers therefore agree that, in such case, the Xxxxxxx
Money then on deposit with the Title Company is a reasonable estimate of
Sellers' damages and that Sellers shall have the right to terminate this
Agreement and be entitled to said sum as liquidated damages, which shall be
Sellers' sole remedy, at law or in equity, as a result of such default. In such
event, the Xxxxxxx Money then on deposit with the Title Company shall be paid to
Sellers, whereupon this Agreement shall terminate and the Parties shall have no
further rights or obligations hereunder, other than those provisions that
expressly survive the termination of this Agreement.
ARTICLE X
CONDITION OF PROPERTY
10.1 No Warranties. Except as set forth in Section 11.3 below, the
entire agreement between Sellers and Purchaser with respect to the Property and
the sale thereof is expressly set forth in this Agreement, and the Parties are
not bound by any agreements, understandings, provisions, conditions,
representations or warranties (whether written or oral and whether made by
Sellers or any agent, employee, member, officer or principal of Sellers or any
other party) other than as are expressly set forth and stipulated in this
Agreement. Without in any manner limiting the generality of the foregoing,
Purchaser acknowledges that it and its representatives have fully inspected the
Property and the Due Diligence Materials, or will be provided with an adequate
opportunity to do so, and that, except for the representations, warranties,
covenants and agreements of Sellers contained herein, the Property is being
purchased by Purchaser in an "as is" and "where is" condition and with all
existing defects (patent and latent) as a result of such inspections and
investigations and not in reliance on any agreement, understanding, condition,
warranty (including, without limitation, warranties of habitability,
merchantability or fitness for a particular purpose) or representation made by
Sellers or any agent, employee, member, officer or principal of Sellers or any
other party (except as otherwise expressly elsewhere provided in this Agreement)
as to the financial or physical (including, without limitation, environmental)
condition of the Property or the areas surrounding the Property, or as to any
other matter whatsoever, including, without limitation, as to any permitted use
thereof, the zoning classification thereof or compliance thereof with federal,
state or local laws, as to the income or expense in connection therewith, or as
to any other matter in connection therewith. Purchaser acknowledges that, except
as otherwise expressly elsewhere provided in this Agreement, neither Sellers,
nor any agent, member, officer, employee or principal of Sellers nor any other
party
21
acting on behalf of Sellers has made or shall be deemed to have made any such
agreement, condition, representation or warranty either expressed or implied.
This Section 10.1 shall survive closing and delivery of the deed, and shall be
deemed incorporated by reference and made a part of all documents delivered by
Sellers to Purchaser in connection with the sale of the Property.
10.2 Release. Without limiting the provisions of Section 10.1 above and
notwithstanding anything to the contrary contained in this Agreement, Purchaser,
for itself and its agents, affiliates, successors and assigns, hereby releases,
acquits and forever discharges Sellers, Sellers' respective parents and
affiliates, and each officer, director, member, shareholder, trustee, partner,
employee, manager, agent and affiliate of either Seller or such parent or
affiliate from any and all rights, claims, demands, causes of actions, losses,
damages, liabilities, costs and expenses (including attorneys' fees and
disbursements whether the suit is instituted or not) whether known or unknown,
liquidated or contingent (hereinafter collectively called the "Claims"), which
Purchaser has or may have in the future, arising from or relating to (i) any
defects (patent or latent), errors or omissions in the design or construction of
the Property whether the same are the result of negligence or otherwise, or (ii)
any other conditions, including, without limitation, environmental and other
physical conditions, affecting the Property whether the same are a result of
negligence or otherwise, including specifically, but without limitation, any
Claim for indemnification or contribution arising under the Comprehensive
Environmental Response, Compensation and Liability Act (42 U.S.C. Section 9601,
et seq.) or any other federal, state or local statute, rule or ordinance
relating to liability of Property owners for environmental matters, whether
arising based on events that occurred before, during, or after Sellers' period
of ownership of the Property and whether based on theories of indemnification,
contribution or otherwise. The release set forth in this section specifically
includes, without limitation, any Claims under any environmental laws of the
United States, the state in which the Property is located or any political
subdivision thereof or under the Americans With Disabilities Act of 1990, as any
of those laws may be amended from time to time and any regulations, orders,
rules of procedures or guidelines promulgated in connection with such laws,
regardless of whether they are in existence on the date of this Agreement.
Purchaser acknowledges that Purchaser has been represented by independent legal
counsel of Purchaser's selection and Purchaser is granting this release of its
own volition and after consultation with Purchaser's counsel. THE RELEASE SET
FORTH HEREIN DOES NOT APPLY TO THE REPRESENTATIONS, WARRANTIES, COVENANTS OR
AGREEMENTS OF SELLERS EXPRESSLY SET FORTH IN THIS AGREEMENT OR TO ANY INDEMNITY
OR WARRANTY EXPRESSLY MADE BY SELLERS HEREIN OR IN ANY DOCUMENT DELIVERED BY
SELLERS AT CLOSING. Purchaser hereby specifically acknowledges that Purchaser
has carefully reviewed this section and discussed its import with legal counsel
and that the provisions of this section are a material part of this Agreement.
ARTICLE XI
MISCELLANEOUS
11.1 Survival. Except as expressly provided otherwise herein, all of
the representations, warranties, covenants, agreements and indemnities of
Sellers or Purchaser
22
contained in this Agreement, to the extent not performed at the Closing, shall
survive the Closing for the period of fifteen (15) months after the Closing Date
and shall not be deemed to merge upon the acceptance of the Deed by Purchaser.
11.2 Notices. All notices, requests and other communications under this
Agreement shall be in writing and shall be either (a) delivered in person, (b)
sent by certified mail, return-receipt requested, or (c) delivered by a
recognized delivery service addressed as follows:
If intended for Purchaser: Corrections Corporation of America
Attn: President
00 Xxxxxx Xxxxx Xxxxxxxxx, Xxxxx 000
Xxxxxxxxx, Xxxxxxxxx 00000
Phone: (000) 000-0000
Fax: (000) 000-0000
With a copy to: Xxxxxx Xxxxxxxxxxx Xxxxx & Xxxxxx, P.A.
Attn: Xxxxxx X. Xxxxxxxx, Xx., Esq.
000 Xxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxxxx, Xxxxxxxxx 00000
Phone: (000) 000-0000
Fax: (000) 000-0000
If intended for either Seller: c/o Reckson Strategic Venture Partners, LLC
Attn: Managing Director
000 Xxxxx Xxxxxxxx Xxxxxxxxx, Xxxxx 0000
Xxxxxxxxx, Xxx Xxxx 00000
Phone: (000) 000-0000
Fax: (000) 000-0000
With a copy to: Xxxxxxx, Xxxxxxxxx LLP
Attn: Xxxxxxx Xxxxxxxx, Esq.
0 Xxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Phone: (000) 000-0000
Fax: (000) 000-0000
or at such other address, and to the attention of such other person, as the
parties shall give notice as herein provided. A notice, request and other
communication shall be deemed to be duly delivered and received (i) if delivered
in person when delivered to the address of the recipient, or (ii) if sent by
mail or by recognized delivery service, on the date the same is duly deposited
in the United States mail or delivered to the recognized delivery service, as
applicable.
11.3 Entire Agreement; Modifications. This Agreement and that certain
confidentiality letter dated June 6, 2002 (the "Confidentiality Letter") embody
and constitute the entire understanding between the Parties with respect to the
transactions contemplated herein, and all other prior or contemporaneous
agreements, understandings, representations and statements (oral
23
or written) are merged into this Agreement. The Confidentiality Letter shall
terminate as of Closing hereunder. Neither this Agreement nor any provision
hereof may be waived, modified, amended, discharged or terminated except by an
instrument in writing signed by the Party against whom the enforcement of such
waiver, modification, amendment, discharge or termination is sought, and then
only to the extent set forth in such instrument.
11.4 Applicable Law. THIS AGREEMENT AND THE TRANSACTIONS CONTEMPLATED
HEREBY SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF COLORADO. The Parties agree that jurisdiction and venue for any
litigation arising out of this Agreement shall be in the Courts of Xxxxxxx
County, Colorado or the U.S. District Court for the District of Colorado and,
accordingly, consent thereto.
11.5 Captions. The captions in this Agreement are inserted for
convenience of reference only and in no way define, describe, or limit the scope
or intent of this Agreement or any of the provisions hereof.
11.6 Binding Effect. This Agreement shall be binding upon and shall
inure to the benefit of the parties hereto and their respective heirs,
executors, administrators, legal representatives, successors, and permitted
assigns.
11.7 Time is of the Essence. With respect to all provisions of this
Agreement, time is of the essence. However, if the first date of any period
which is set out in any provision of this Agreement falls on a day which is not
a Business Day, then, in such event, the time of such period shall be extended
to the next day which is a Business Day.
11.8 Assignment. This Agreement shall inure to the benefit of Sellers
and Purchaser and their respective successors and permitted assigns, and shall
be binding upon Sellers and Purchaser and their respective heirs, executors,
administrators, trustees, successors and permitted assigns; provided, however,
that neither Party may assign any rights or delegate any of the obligations
created under this Agreement without the prior written consent of the other
Party, which consent may be withheld at the sole discretion of the other Party
for any reason or no reason whatsoever, except that Purchaser may designate at
the Closing one or more affiliates of Purchaser to accept the conveyance of all
or a portion of the Property (provided that such designation shall in no way
cause Purchaser to be released from its obligations and liabilities hereunder).
11.9 Joint and Several Liability. The obligations and liability of
Sellers hereunder shall be joint and several.
11.10 Non-Disclosure. Each of the parties to this Agreement covenant
and agree that the fact that the parties are considering the transactions
contemplated in this Agreement and any information furnished or otherwise
obtained, directly or indirectly, by such party, its directors, officers,
partners, employees, agents or representatives, including, without limitation,
attorneys, accountants, lenders, consultants and other professional advisors
(collectively, the "Representatives") and all reports, analysis, compilations,
data, studies or other documents prepared by such parties containing or based
all or in part on, any such information (collectively,
24
the "Information") will be kept strictly confidential and will not, without the
prior written consent of the non-disclosing party, be disclosed to any other
party, directly or indirectly, in whole or in part, and will only be used by the
parties in connection with the negotiation and consummation of the transactions
contemplated by this Agreement. Notwithstanding the foregoing, the provisions of
this Section 11.10 shall not prohibit: (i) the disclosure of any Information to
the parties' Representatives provided that they are made aware of the
restrictions contained herein; (ii) the disclosure to parties with whom Sellers
are engaging in bona fide good faith negotiations to obtain a so-called back-up
contract for the sale of the Property, pursuant to Section 11.11 hereof,
provided such disclosure shall be strictly limited to the fact that this
Agreement exists and the time for performance and closing hereunder, and such
disclosure shall not include any of the other terms and conditions of this
Agreement; or (iii) the disclosure of any Information (a) which at the time of
its disclosure, is in the public domain or is otherwise available to the
disclosing party from a non-confidential source or from a party without an
obligation of confidentiality, (b) which is lawfully in the disclosing party's
possession prior to such disclosure, or (c) which is required to be disclosed by
law or any regulatory or
25
governmental authority, provided that in connection with the disclosure of such
Information in connection with any legal proceeding or investigation, the
non-disclosing party is provided prompt notice of any disclosure requirement and
is permitted to assist in the obtainment of an order protecting such information
from public disclosure. The provisions of this Section 11.10 shall survive the
termination of this Agreement without the occurrence of Closing.
11.11 Additional Offers: Notwithstanding the execution of this
Agreement by Sellers and Purchaser, Sellers shall have the continuing right to
negotiate and accept "back up" offers for the Property and to enter into one or
more purchase or lease agreements with any other third party on such terms as
Sellers deem appropriate provided that any such agreement or lease shall provide
that it shall not be effective unless and until this Agreement is terminated
without the occurrence of the Closing.
EXECUTED to be effective as of the Effective Date.
SELLERS: PURCHASER:
XXXXXXX CORRECTIONAL CORRECTIONS CORPORATION OF AMERICA
PROPERTIES L.L.C.
By: /s/ Xxxx Xxxxxx By: /s/ Xxxxxx X. Xxxxx, Xx.
------------------------------ ---------------------------------
Title: Authorized Agent Title: Chief Financial Officer
--------------------------- ------------------------------
Date: November 20, 2002 Date: November 21, 2002
---------------------------- -------------------------
XXXXXXX CORRECTIONAL
SERVICES L.L.C.
By: /s/ Xxxxxx Xxxxxxxx
------------------------------
Title: Authorized Agent
---------------------------
Date: November 20, 2002
----------------------------
26
[Exhibits and Schedules Intentionally Omitted]
FIRST AMENDMENT TO
AGREEMENT OF SALE AND PURCHASE
This First Amendment to Agreement of Sale and Purchase is made and
entered into by and between Xxxxxxx Correctional Properties, L.L.C., a Delaware
limited liability company ("CCP"), Xxxxxxx Correctional Services, L.L.C., a
Delaware limited liablity company ("CCS") (CCP and CCS are sometimes singularly
referred to herein as "Seller" and collectively referred to herein as "Sellers")
and Corrections Corporation of America, a Maryland corporation (hereinafter
referred to as "Purchaser"). Sellers and Purchaser are sometimes collectively
referred to herein as the "Parties" and each of the Parties is sometimes
singularly referred to herein as a "Party".
WHEREAS, Sellers and Purchaser are Parties to that certain Agreement of
Sale and Purchase dated November 21, 2002 (the "Agreement"); and
WHEREAS, Sellers and Purchaser have agreed to amend the Agreement as
set forth herein; and
WHEREAS, in reliance upon such amendments, Purchaser has agreed to
deliver to Seller a Non-termination Notice pursuant to Section 4.3 of the
Agreement;
NOW, THEREFORE, in consideration of the premises and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Parties agree as follows:
1. The Agreement is amended by deleting the definition of "Purchase
Price" as set forth on page 5, and substitute in lieu thereof the following:
"Purchase Price" shall mean the sum of Forty-Seven Million
Dollars ($47,000,000), subject to adjustment as follows: In
the event Sellers are unable to deliver an assignment of a
Roof Warranty at Closing, the Purchase Price shall be reduced
an additional $50,000, and, in the event Sellers are unable to
provide (whether or not Seller is able to obtain the
Licensor's consent to any assignment thereof) the Software
Licenses at or prior to Closing, the Purchase Price shall be
reduced an additional $50,000.
2. The following two definitions are added to the Agreement:
"Roof Warranty" shall mean a warranty agreement or agreements
from each of the installer and the manufacturer for all of the
existing roofs on the Property (other than any metal roofs) in
customary commercial form and substance and reasonably
satisfactory to Purchaser.
"Software Licenses" shall mean a Certificate of Authenticity
from Microsoft for the operating systems for not less than 90%
of the desktop computers at the Property, together with a
Certificate of Authenticity from Microsoft for the Microsoft
Office software for not less than 90% of desktop computers
currently
utilizing such software, all in customary commercial form and
substance and reasonably satisfactory to Purchaser.
3. Purchaser agrees that the reduction in Purchase Price set forth
herein shall constitute Purchaser's sole remedy for any defects or claims
arising out of the condition of the roof on the Improvements or the failure of
the Seller to have and/or deliver the Software Licenses or the other matters
raised in the letter (and related attachments) from Purchaser to Seller dated
December 20, 2002.
4. Section 5.5.c. of the Agreement is amended by changing the amount of
"$3,000,000" as set forth therein, to "2,500,000" and by providing that such
amount shall be further reduced by the amount of any additional reduction in the
Purchase Price as contemplated in the definition thereof.
5. Purchaser advises Seller that the conditions set forth in Section
6.1(e) and 6.1(i) have been satisfied as of the date hereof.
6. The Parties agree that this Amendment shall constitute Purchaser's
Non-termination Notice and Purchaser advises Seller that, to the Best Knowledge
of Purchaser, neither Seller is in default under the Agreement as of the date
hereof.
7. Capitalized terms not as otherwise defined herein shall have the
meanings set forth in the Agreement. Except as expressly amended hereby, the
Agreement remains in full force and effect.
IN WITNESS WHEREOF, this Amendment is executed and effective as of
January 3, 2003.
SELLERS: PURCHASER:
XXXXXXX CORRECTIONAL CORRECTIONS CORPORATION OF AMERICA
PROPERTIES, L.L.C.
By: /s/ Xxxxxx Xxxxxxxx By: /s/ Xxxxxx X. Xxxxx, Xx.
--------------------------- -------------------------------
Title: Authorized Agent Title: Chief Financial Officer
------------------------ ----------------------------
XXXXXXX CORRECTIONAL
SERVICES, L.L.C.
By: /s/ Xxxx Xxxxxx
---------------------------
Title: Authorized Agent
------------------------
SECOND AMENDMENT TO
AGREEMENT OF PURCHASE AND SALE
This Second Amendment to Agreement of Sale and Purchase is made and
entered into by and between Xxxxxxx Correctional Properties, L.L.C., a Delaware
limited liability company ("CCP"), Xxxxxxx Correctional Services, L.L.C., a
Delaware limited liability company ("CCS") (CCP and CCS are sometimes singularly
referred to herein as "Seller" and collectively referred to herein as
"Sellers"), Corrections Corporation of America, a Maryland corporation
(hereinafter referred to as "Purchaser"), and Rap Xxxxxxx Land, LLC, a Delaware
limited liability company ("Rap"). Sellers and Purchaser are sometimes
collectively referred to herein as the "Parties" and each of the Parties is
sometimes singularly referred to herein as a "Party."
WHEREAS, Sellers and Purchaser are Parties to that certain Agreement of
Sale and Purchase dated November 21, 2002, as amended by that certain First
Amendment to Agreement of Purchase and Sale dated January 3, 2003 (collectively,
the "Agreement"); and
WHEREAS, the Parties desire to add Rap as a Party to the Agreement,
pursuant to the terms set forth herein.
NOW, THEREFORE, in consideration of the premises and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Parties agree as follows:
1. The Agreement is amended by adding Rap as an additional Seller. Rap
hereby (a) undertakes all duties, responsibilities and obligations of a Seller
thereunder; and (b) warrants and represents that all statements in the Agreement
relating to the Sellers are true and correct with respect to Rap as of the date
hereof.
2. Except as expressly amended hereby, the Agreement remains in full
force and effect.
IN WITNESS WHEREOF, this Second Amendment to Agreement of Purchase and
Sale is executed this 17th day of January, 2003.
SELLERS: PURCHASER:
XXXXXXX CORRECTIONAL CORRECTIONS CORPORATION OF
PROPERTIES, L.L.C. AMERICA
By: /s/ Xxxxx Xxxxxxxxx By: /s/ Xxxx X. Xxxxxxxxx
--------------------------- ----------------------------------
Title: Authorized Agent Title: Vice President, Treasurer
------------------------ -------------------------------
XXXXXXX CORRECTIONAL
SERVICES, L.L.C.
By: /s/ Xxxxx Xxxxxxxxx
-----------------------------
Title: Authorized Agent
--------------------------
RAP XXXXXXX LAND, LLC
By: /s/ Xxxxx Xxxxxxxxx
-----------------------------
Title: Authorized Agent
--------------------------
Xxxxxxx Correctional Properties, L.L.C.
Xxxxxxx Correctional Services, L.L.C.
C/o Reckson Strategic Venture Partners, LLC
Attn: Managing Director
000 Xxxxx Xxxxxxxx Xxxxxxxxx, Xxxxx 0000
Xxxxxxxxx, Xxx Xxxx 00000
RE: DESIGNATION OF AFFILIATE
To Whom It May Concern:
Pursuant to Section 11.8 of the Agreement of Purchase and Sale dated
November 21, 2002 (the "Agreement"), by and among Xxxxxxx Correctional
Properties, L.L.C., Xxxxxxx Correctional Services, L.L.C., and Corrections
Corporation of America ("CCA"), CCA hereby designates its affiliate, CCA of
Tennessee, Inc., a Tennessee corporation, to accept the assignment of the
Operating and Service Agreements and the Incarceration Agreements, as those
terms are defined in the Agreement. CCA further designates its affiliate, CCA
Properties of America, LLC, a Tennessee limited liability company, to accept the
conveyance of the Real Property and the Personal Property, as those terms are
defined in the Agreement.
CORRECTIONS CORPORATION OF AMERICA
By: /s/ Xxxx X. Xxxxxxxxx
-------------------------------
Title: Vice President, Treasurer
----------------------------
Date: January 17, 2003
