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EXHIBIT 10.13
LEASE AGREEMENT
(ELOY)
THIS LEASE AGREEMENT ("Lease") dated as of the 18th day of July, 1997,
by and between CCA PRISON REALTY TRUST, a Maryland real estate investment trust
("Landlord") and CORRECTIONS CORPORATION OF AMERICA, a Tennessee corporation
("Tenant").
RECITALS
WHEREAS, Tenant (or one of Tenant's affiliates) has concurrently
conveyed to Landlord the property described in Exhibit A hereto, and Landlord
and Tenant desire that Landlord lease such property back to Tenant; and
WHEREAS, Landlord and Tenant have entered into a Master Agreement to
Lease of even date herewith (the "Master Agreement") which sets forth certain
agreements of the parties with respect to the lease of various properties
including the property that is the subject of this Lease;
NOW, THEREFORE, in consideration of the premises and of their
respective agreements and undertakings herein, Landlord and Tenant agree as
follows:
ARTICLE I
PREMISES AND TERM
1.1 Leased Property. Landlord hereby leases to Tenant and Tenant leases
from Landlord the Land located in the City of Xxxx, Pinal County, State of
Arizona, described in Exhibit A hereto, and all Improvements, Fixtures, and
Personal Property thereon or thereto (each as defined in the Master Agreement,
and, together with said Land, the "Leased Property"); such Leased Property
collectively known and described at the date hereof as the Xxxx Detention
Center;
SUBJECT, HOWEVER, to the lien of the mortgage debt described in Exhibit
B hereto, if any, and to all easements, liens, encumbrances, restrictions,
agreements, and other title matters existing as of the date hereof and listed in
Exhibit C hereto (collectively the "Permitted Exceptions").
1.2 Term. The initial term (the "Fixed Term") of the Lease shall be for
a fixed term of twelve (12) years commencing on July 18, 1997 (the "Commencement
Date") and expiring on July 17, 2009 (the "Expiration Date"). The Term of this
Lease may be renewed on the mutual agreement of Landlord and Tenant as follows:
(i) provided that Tenant gives Landlord notice on or before the date which is
six (6) months prior to the Expiration Date, upon the mutual agreement of
Landlord and Tenant, the Lease shall be renewed for one (1) additional five (5)
year term (the "Extended Term") on the same terms and provisions (other than
with respect to renewal) as the Fixed Term, as set forth in the Lease; (ii)
provided that Tenant gives Landlord notice on or before the date which is six
(6) months prior to the expiration of the Extended Term, upon the mutual
agreement of Landlord and Tenant, the Lease shall be renewed for one (1)
additional five (5) year term (the "Second Extended Term") on the same terms and
provisions (other than with respect to renewal) as
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the Fixed Term, as set forth in the Lease; and (iii) provided that Tenant gives
Landlord notice on or before the date which is six (6) months prior to the
expiration of the Second Extended Term, upon the mutual agreement of Landlord
and Tenant, the Lease shall be renewed for one (1) additional five (5) year term
(the "Third Extended Term") on the same terms and provisions (other than with
respect to renewal) as the Fixed Term, as set forth in the Lease. Tenant's right
to so extend the Term of the Lease is conditioned on Landlord's prior approval
of the Extended Term, Second Extended Term, or Third Extended Term, as the case
may be. The term "Term" used in this Agreement means the Fixed Term, Extended
Term, Second Extended Term and Third Extended Term, as appropriate. The term
"Lease Year" means each twelve (12) month period during the Term commencing on
January 1 and ending on December 31, except the first Lease Year of each Lease
shall be the period from the Commencement Date through the following December
31, and the last Lease Year shall end on the date of termination of the Lease if
a day other than December 31. Landlord may terminate this Lease prior to the
expiration of the Term hereof, at any time following the date which is five (5)
years from the date hereof, upon written notice to Tenant not less than eighteen
(18) months prior to the effective date of such termination.
ARTICLE II
RENT
2.1 Base Rent. Tenant shall pay Landlord Base Rent for the Term in
advance in consecutive monthly installments payable on the first day of each
month during the Term, the Extended Term, Second Extended Term and the Third
Extended Term, commencing on the Commencement Date, in accordance with the Base
Rent Schedule attached hereto as Exhibit D. If the Commencement Date or the
Expiration Date shall be other than on the first day of a calendar month, the
initial (or final, as appropriate) monthly installment of Base Rent payable
pursuant to the Lease shall be prorated for the number of days until, in the
case of the initial monthly installment, the first day of the calendar month
following the Commencement Date and, in the case of the final monthly
installment, the Expiration Date.
2.2 Additional Rent. The Base Rent shall be subject to such increases
over the Term as determined pursuant to Section 2.02 of the Master Agreement.
2.3 Other Additional Rent. Tenant shall also pay all Other Additional
Rent with respect to the Leased Property, as set forth in the Master Agreement.
ARTICLE III
OTHER TERMS AND CONDITIONS
3.1 Master Agreement Incorporated Herein. All provisions of the Master
Agreement (except any provisions expressly therein not to be a part of an
individual lease of leased property) are hereby incorporated in and are a part
of this Lease of the Leased Property.
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3.2 Recordation. At the request of Landlord or Tenant, a short form
memorandum of this Lease may be recorded in the real estate records of any
county which Landlord or Tenant deems appropriate in order to provide legal
notice of the existence hereof.
IN WITNESS WHEREOF, the Landlord and the Tenant have executed this
Lease or caused the same to be executed by their respective duly authorized
officers as of the date first set forth above.
CCA PRISON REALTY TRUST
By:
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Title:
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CORRECTIONS CORPORATION OF AMERICA
By:
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Title:
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EXHIBIT A
Legal Description of Leased Property
PARCEL "A" - PRISON COMPOUND
A portion of the Northeast Quarter of Section 16, Township 7 South, Range 8
East, of the Gila and Salt River Base and Meridian, Pinal County, Arizona; using
a basis of bearing the East line of the Northeast corner of said Section 16,
using a bearing of North 00 degrees 00 minutes 07 seconds East and being more
particularly described as follows:
Commencing at the East quarter corner of said Section 16, being a brass cap in
handhole; thence South 89 degrees 47 minutes 31 seconds West, along the
East/West mid-section line of said Section 16, a distance of 735.00 feet to the
point of beginning; thence continuing South 89 degrees 47 minutes 31 seconds
West along said mid-section line 1907.59 feet to the center of said Section 16,
being a 3 inch aluminum monument; thence North 00 degrees 02 minutes 32 seconds
West along the North/South mid-section line of said Section 16, a distance of
2648.25 feet to the North quarter corner of said Section 16, being a G.L.O brass
cap; thence North 89 degrees 56 minutes 55 seconds East, along the north line of
said northeast quarter 1909.62 feet; thence South 00 degrees 00 minutes 07
seconds West, parallel to the East line of said Northeast quarter 2643.03 feet
to the point of beginning.
Except all coal, oil, gas and mineral deposits as reserved in instrument
recorded September 20, 1944 in Book 71 of Deeds, page 511.
Said parcel contains approximately 120 acres, more or less. This legal
description is recorded in Docket 1958, page 755, Records of Pinal County,
Arizona.
PARCEL "B" - WELL SITE AND INGRESS/EGRESS EASEMENT
A parcel of land situated in the Northeast Quarter of Section 16, Township 7
South, Range 8 East of the Gila and Salt River Base and Meridian, Pinal County,
Arizona; more particularly described as follows:
Beginning at the East quarter corner of said Section 16, measure westerly along
the mid-section line bearing South 89 degrees 47 minutes 31 seconds West, a
distance of 452.00 feet to the true point of beginning; thence continuing
westerly along the mid-section line bearing South 89 degrees 47 minutes 31
seconds West, a distance of 208.00 feet; thence northerly bearing North 00
degrees 00 minutes 07 seconds East, a distance of 208.00 feet; thence easterly
bearing North 89 degrees 47 minutes 31 seconds East, a distance of 208.00 feet;
thence southerly bearing South 00 degrees 00 minutes 07 seconds West, a distance
of 208.00 feet to the true point of beginning.
Except all coal, oil, gas and mineral deposits as reserved in instrument
recorded September 20, 1944 in Book 71 of Deeds, page 511.
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Said parcel contains approximately 1.0 acres more or less.
Together with and subject to an easement for ingress and egress more
particularly described as follows:
A 30 foot strip of land lying to the North of the following described line;
beginning at the East quarter corner of said Section 16, measuring westerly
along the mid-section line bearing South 89 degrees 47 minutes 31 seconds West,
a distance of 40.00 feet to the true point of beginning; thence continuing
westerly along the mid-section line bearing South 89 degrees 47 minutes 31
seconds West, a distance of 412.00 feet.
Except all gas, oil, metals and mineral rights as reserved in patent from State
of Arizona recorded in Book 32 of Deeds, page 325, Records of Pinal County,
Arizona.
This legal description is recorded in Docket 1999, page 997, Records of Pinal
County, Arizona.
PARCEL "C" - SEWAGE DISPOSAL BEDS
A parcel of land situated in the northwest corner of Section 16, Township 7
South, Range 8 East, of the Gila and Salt River Base and Meridian, Pinal County,
Arizona, more particularly described as follows:
Beginning at the North quarter corner of said Section 16, measure southerly
along the mid-section line bearing South 00 degrees 02 minutes 32 seconds East,
a distance of 600.00 feet to the true point of beginning; thence continuing
southerly along the mid-section line bearing South 00 degrees 02 minutes 32
seconds East, a distance of 600.00 feet; thence westerly bearing South 89
degrees 57 minutes 28 seconds West, a distance of 1815.00 feet; thence northerly
bearing North 00 degrees 02 minutes 32 seconds West, a distance of 600.00 feet;
thence Easterly bearing North 89 degrees 57 minutes 28 seconds East, a distance
of 1815.00 feet to the true point of beginning.
Except all gas, oil, metals and mineral rights as reserved in patent from State
of Arizona Recorded in Book 32 of Deeds, page 325, Records of Pinal County,
Arizona.
Said parcel contains approximately 25 acres, more or less. This legal
description is recorded in Docket 1999, page 997, Records of Pinal County,
Arizona.
Xxxx Detention Center
Eloy, Pinal County, Arizona
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EXHIBIT B
Mortgage Debt
Property: Xxxx Detention Center
This property is subject to the following Mortgage Debt:
That certain deed of trust of First Union National Bank of Tennessee,
as Administrative Agent, dated July 18, 1997.
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EXHIBIT C
Permitted Exceptions
Property: Xxxx Detention Center
1. Taxes and assessments collectible by the County Treasurer not yet due
and payable for the year 1997.
2. Assessments, obligations and liabilities by reason of the property
described herein being included in any existing or proposed sewer
system, street, lighting or other assessment and/or improvement
district of the City of Xxxx, if any.
3. Liabilities and obligations existing or which may arise against the
property by reason of its inclusion within Central Arizona Water
Conservation District, Pinal County Flood Control District and Central
Arizona Water Irrigation District.
4. Reservations contained in State of Arizona patent recorded in Book 32
of Deeds, page 325, reading as follows: The State of Arizona reserves
all rights to any and all minerals, ores, and metals of every kind and
character and all coal, asphaltum, oil, gases, fertilizers, fossils and
other like substances in or under said land and all the right of
ingress and egress for the purpose of mining, together with enough of
the surface of the land as may be necessary for the proper and
convenient working and extraction of such minerals and substances.
5. Water rights, claims or title to water, whether or not shown by the
public records.
6. The right of entry to prospect for, mine and remove the oil, gas and
other mineral deposits in said land as reserved in Deed recorded in
Book 71 of Deeds, Page 511.
7. Liabilities and obligations imposed upon said land by reason of its
inclusion within the Central Arizona Water Irrigation and Drainage
District as disclosed by instrument recorded on January 20, 1990, in
Docket 1580, page 919.
8. Easement for public highway purposes and rights incident thereto, as
set forth in instrument recorded in Book 85 of Deeds, page 243. (Parcel
A)
9. Resolution by the Board of Supervisors of Pinal County Arizona
purporting to establish a county roadway, 33 feet on each side of all
section lines, recorded February 21, 1964, in Docket 375, page 572.
(Parcel A)
10. Easement for electric transmission lines and rights incident thereto,
as set forth in instrument recorded in Docket 1301, page 452. (Parcel
A)
11. Easement for water distribution system canals, laterals and ditches and
rights incident thereto, as set forth in instrument recorded in Docket
1515, page 195. (Parcels A and B)
12. Easement for ingress, egress and irrigation purposes and rights
incident thereto, as set forth in instrument recorded in Docket 1568,
page 482. (Parcels A and C)
13. Easement for electric lines and appurtenant facilities and rights
incident thereto, as set forth in instrument recorded in Docket 2026,
page 456. (Parcel A)
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14. Easement for electric lines and appurtenant facilities and rights
incident thereto, as set forth in instrument recorded in Docket 2026,
page 458. (Parcel B)
15. Agreement for the operation, maintenance, repair and financing of an
irrigation distribution system according to the terms and conditions
contained therein, dated June 13,1984, between Central Arizona
Irrigation and Drainage District, an irrigation district, and B.K.W.
Farms, Inc., an Arizona corporation, recorded June 26,1985, in Docket
1295, page 47.
16. Agreement for irrigation and water use according to the terms and
conditions contained therein, dated December 1, 1989, between Central
Arizona Irrigation and Drainage District, an irrigation district, and
Lin & Sons, Enterprises, Inc., a California corporation, recorded March
26, 1990, in Docket 1665, page 684.
17. All matters shown on ALTA/ACSM Land Title Survey, dated June 20, 1997,
prepared by Xxxxxx X. Xxxxxxxx, R.L.S. No. 16490, Xxxxxxxx Engineering
Inc., 0000 X. 00xx Xxxxxx, Xxxxx 000, Xxxxxxx, XX 00000-0000, Job No.
97-26.
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EXHIBIT D
Base Rent Schedule
Property: Xxxx Detention Center
Tenant will pay to Landlord annual Base Rent of $6,000,000.00, payable
in equal monthly installments of $500,000.00.
Base Rent for the Extended Term, Second Extended Term and Third
Extended Term shall be equal to the fair market rental value of the Leased
Property as of the respective commencement dates thereof.
