EXHIBIT 10.3
FIRST AMENDMENT AND CONSENT
TO THIRD AMENDED AND RESTATED CREDIT AGREEMENT
DATED AS OF DECEMBER 27,2002
This FIRST AMENDMENT AND CONSENT TO THIRD AMENDED AND RESTATED
CREDIT AGREEMENT (together with all Exhibits, Schedules and Annexes hereto, this
"Amendment") is among CORRECTIONS CORPORATION OF AMERICA, a Maryland corporation
(the "Borrower"), the Lenders (as defined below), and ▇▇▇▇▇▇ COMMERCIAL PAPER
INC., as administrative agent for the Lenders (in such capacity, the
"Administrative Agent").
PRELIMINARY STATEMENTS:
A. The Borrower, the lenders party thereto (the "Lenders"), the
Administrative Agent, ▇▇▇▇▇▇ Brothers Inc., as lead arranger and sole
book-running manager, Deutsche Bank Securities Inc. and UBS Warburg LLC, as
co-syndication agents, and Societe Generale, as documentation agent, have
entered into a Third Amended and Restated Credit Agreement, dated as of May 3,
2002 (together with all Annexes, Exhibits and Schedules thereto, the "Credit
Agreement"; capitalized terms used and not otherwise defined herein shall have
the meanings ascribed to such terms in the Credit Agreement; terms defined in
Sections 2 and 3 hereof are used herein as defined therein);
B. The Borrower has advised the Lenders that it desires to
consummate the Colorado Acquisition (as defined below) and, in connection
therewith, obtain the ability to draw on $30,000,000 in aggregate principal
amount of additional loans through the creation of additional commitments under
the Tranche B Term Loan Facility (the "Additional Tranche B Term Loans") to
finance a portion of the purchase price thereof;
C. The Borrower has further advised the Lenders that it desires
to transfer (i) the real property listed on Part I of Schedule A hereto to a
Tennessee limited liability company to be a newly formed, Wholly Owned
Subsidiary of the Borrower ("Properties I"), (ii) the real property listed on
Part II of Schedule A hereto to a Delaware limited partnership to be a newly
formed, Wholly Owned Subsidiary of the Borrower ("Properties II"), (iii) the
real property listed on Part III of Schedule A hereto to a Tennessee limited
liability company to be a newly formed, Wholly Owned Subsidiary of the Borrower
("Properties III") and (iv) the real property listed on Part IV of Schedule A
hereto to a Tennessee limited liability company to be a newly formed, Wholly
Owned Subsidiary of the Borrower ("Properties IV"), in each case as such
transfers are more particularly described on Schedule 1 and on such other terms
and conditions as are satisfactory to the Administrative Agent, including,
without limitation, that such transfers will be made subject to and subordinate
to the Mortgages (the "Real Property Transfers"); and
D. The Borrower has requested that the Lenders consent to the
Colorado Acquisition, the Real Property Transfers and the creation and
incurrence of the Additional Tranche B Term Loans.
NOW, THEREFORE, in consideration of the premises and for other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
1. CONSENT.
Subject to the satisfaction of the conditions set forth in Section 3
hereof, the requisite Lenders hereby consent to the Colorado Acquisition, the
Real Property Transfers and the creation and incurrence of the Additional
Tranche B Term Loans.
2. AMENDMENTS TO CREDIT AGREEMENT TO BE EFFECTIVE ON THE FIRST AMENDMENT
EFFECTIVE DATE.
(a) The following new definitions are hereby added to
Section 1.1 of the Credit Agreement in the appropriate alphabetical order:
"Colorado Acquisition": the purchase by Properties I
of the ▇▇▇▇▇▇▇ County Correctional Facility in Olney Springs,
Colorado for approximately $47,500,000, all on terms and
conditions satisfactory to the Administrative Agent
(including, without limitation, compliance with Section 6.10
of the Credit Agreement).
"Colorado Acquisition Closing Date": the date of
consummation of the Colorado Acquisition which shall be no
later than January 30,2003.
"First Amendment": the First Amendment and Consent to
Third Amended and Restated Credit Agreement, dated as of
December 27,2002.
"First Amendment Effective Date": the date on which
the First Amendment became effective according to its terms.
"Operating Subsidiaries": all Subsidiaries of the
Borrower other than the Immaterial Subsidiaries and the
Properties Group Parties.
"Properties I": CCA Properties of America, LLC, a
Tennessee limited liability company.
"Properties II": CCA Properties of Texas, L.P., a
Delaware limited partnership.
"Properties III": CCA Properties of Arizona, LLC, a
Tennessee limited liability company.
"Properties IV": CCA Properties of Tennessee, LLC, a
Tennessee limited liability company.
"Properties Group Parties": collectively, Properties
I, Properties II, Properties III and Properties IV.
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"Real Property Transfers": the Real Property
Transfers as defined in the First Amendment.
(b) The definition of "Excess Cash Flow" contained in
Section 1.1 of the Credit Agreement is hereby amended by (i) replacing the "and"
immediately preceding clause (x) thereof with ","and (ii) adding the following
new clause at the end thereof: "and (xi) cash payments not to exceed $8,400,000
in the aggregate made in fiscal year 2003 in connection with the early
termination of Hedge Agreements."
(c) Section 4.15 of the Credit Agreement is hereby
amended by attaching to the Credit Agreement the Schedule 4.15(c) attached
hereto as Annex 1 and adding the following new clause (c):
"(c) The Subsidiaries listed on Schedule 4.15(c) constitute all of the
Subsidiaries of the Borrower as of the First Amendment Effective Date.
Schedule 4.15(c) sets forth as of the First Amendment Effective Date
the name and jurisdiction of organization of each Subsidiary and, as
to each Subsidiary, the percentage and number of each class of Capital
Stock owned by the Borrower and its Subsidiaries."
(d) Section 4.19(a) of the Credit Agreement is hereby
amended by replacing Schedule 4.19(a)-1 with the new Schedule 4.19(a)-l attached
hereto as Annex 2.
(e) Section 4.23(a) of the Credit Agreement is hereby
amended by replacing Schedule 4.23(a) with the new Schedule 4.23(a) attached
hereto as Annex 3 and replacing the words "Restatement Effective Date" with
"First Amendment Effective Date".
(f) Section 6 of the Credit Agreement is hereby amended
by adding the following new Section 6.15 at the end thereof:
"6.15 Properties Group Parties. (a) Ensure that no
Properties Group Party conducts, transacts or otherwise engages in any
material business (other than as directly required by and incidental
to its ownership of Prison Facilities) or incurs any Indebtedness
(other than the incurrence and repayment of the Indebtedness permitted
by Section 7.2(a), (b), (f), and (n)) or grants any Liens (other than
(x) the Liens created pursuant to the Security Documents and (y) Liens
permitted under Section 7.3 (other than under clauses (f) and (h)
thereof) which are directly required by or incidental to its ownership
of Prison Facilities) and (b) maintain the ownership structure and
percentages of each Properties Group Party as set forth in Schedule
4.15(c)."
(g) Section 7.2 of the Credit Agreement is hereby amended
by (i) adding the word "Operating" (A) immediately prior to the word
"Subsidiaries" in each of clauses (c), (e), (k), and (p) thereof and (B)
immediately prior to the word "Subsidiary" in clauses (g) and (h) thereof, (ii)
inserting the phrase "Indebtedness of the Borrower consisting of" immediately
prior to the phrase "the Litigation Settlement Debt" in clause (1) thereof and
(iii) inserting the phrase "other than any Properties Group Party" after the
word "Guarantor" in clause (0) thereof.
(h) Section 7.3 of the Credit Agreement is hereby amended
by adding the word "Operating" immediately prior to the word "Subsidiaries" in
each of clauses (f) and (h) thereof.
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(i) Section 7.4 of the Credit Agreement is hereby amended
by: (i) deleting the word "and" at the end of clause (a) thereof, (ii) replacing
the period at the end of clause (b) thereof with "; and", and (iii) inserting
the following new clause (c):
"(c) notwithstanding anything to the contrary in clauses (a)
and (b) of this Section 7.4, no Properties Group Party may
enter into any merger or consolidation with or Dispose of any
or all of its assets to any Person other than the Borrower
(directly or indirectly through the relevant intermediate
Subsidiary of the Borrower)."
(j) Section 7.5 of the Credit Agreement is hereby amended
by:
(i) inserting the following proviso immediately after
the words "Subsidiary Guarantor" in clause (c)
thereof : ";provided that the Capital Stock of any
Properties Group Party may only be issued or sold to
the Borrower or, in the case of Properties III and
Properties IV, to CCA of Tennessee" and
(ii) replacing the word "and" at the end of clause
(k) thereof with ",", replacing the "." at the end of
clause (1) thereof with "; and" and adding the
following new clause (m): "the Disposition for cash
of unused equipment and undeveloped Real Estate;
provided that the fair market value of such Disposed
equipment and such Disposed Real Estate may not
exceed $5,000,000 in the aggregate for any fiscal
year of the Borrower."
(k) Section 7.8(g) of the Credit Agreement is hereby
amended by:
(i) deleting the word "and" at the end of
subclause (iv) thereof;
(ii) deleting the period and adding the following
proviso to the end of subclause (v) thereof:
";provided that, in addition to the foregoing,
Properties I may pay cash consideration as required
to consummate the Colorado Acquisition in fiscal year
2003 (such cash consideration in an aggregate amount
not to exceed $47,500,000, plus all customary costs
and expenses related thereto); and"
(iii) inserting the following new subclause (vi):
"(vi) notwithstanding the foregoing, Properties I may
consummate the Colorado Acquisition as a Permitted Acquisition
hereunder, even if the Consolidated Secured Leverage Ratio is
in excess of 2.85 to 1.OO, provided that the requirements of
subclauses (i)-(v) of this clause (g) are otherwise
satisfied."
(1) Section 7.9 of the Credit Agreement is hereby amended
by inserting the following parenthetical at the end of clause (c) in the first
sentence thereof: "(it being understood that, without limiting the foregoing, no
Credit Party which is a limited liability company or a limited partnership shall
amend its Governing Documents to elect that the equity interests therein be
treated as securities governed by the ▇▇▇)".
▇
▇. OTHER AMENDMENTS. The following amendments to the Credit Agreement
shall be effective on the Additional Tranche B Effective Date (it being
understood that if the Additional Tranche B Effective Date does not occur, such
amendments will not be made).
(a) Effective on the Additional Tranche B Effective Date,
the following new definitions are hereby added to Section 1.1 of the Credit
Agreement in the appropriate alphabetical order:
"Additional Tranche B Term Loan Lender": a Lender
holding an Additional Tranche B Term Loan Commitment or an
Additional Tranche B Term Loan.
"Additional Tranche B Term Loans": as defined in
Section 2.1
"Additional Tranche B Term Loan Commitment": the
commitment of certain Lenders or other lenders to make
Additional Tranche B Term Loans, in a principal amount not to
exceed the amount set forth under the heading "Additional
Tranche B Term Loan Commitment" opposite such Lender's name on
Schedule 1 to the Lender Addendum delivered by such Lender (in
the case of a new Lender) or, in a written confirmation to the
Administrative Agent (in the case of an existing Lender).
(b) Effective on the Additional Tranche B Effective Date,
the definition of "Lender Addendum" contained in Section 1.1 of the Credit
Agreement is hereby amended and restated in its entirety as follows:
"Lender Addendum": with respect to any Lender, a
Lender Addendum in the Administrative Agent's standard form.
(c) Effective on the Additional Tranche B Effective Date,
the definition of "Required Lenders" contained in Section 1.1 of the Credit
Agreement is hereby amended by inserting the following text immediately after
the words "Term Loans then outstanding":
"and, with respect to the Additional Tranche B Term Loans, any
unfunded, unexpired Additional Tranche B Term Loan
Commitments"
(d) Effective on the Additional Tranche B Effective Date,
the definition of "Tranche B Term Loan Commitment" contained in Section 1.1 of
the Credit Agreement is hereby amended and restated in its entirety as follows:
"Tranche B Term Loan Commitment": as to any Tranche B
Term Loan Lender, the obligation of such Lender, if any, to
make or purchase a Term Loan in a principal amount not to
exceed the amount set forth under the heading "Tranche B Term
Loan Commitment" opposite such Lender's name on Schedule 1 to
the Lender Addendum delivered by such Lender or in the
Assignment and Acceptance pursuant to which such Lender became
a party hereto, as the same may be changed from time to time
pursuant to the terms hereof or in connection with the First
Amendment."
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(e) Effective on the Additional Tranche B Effective Date,
Section 2.1 (b) of the Credit Agreement is hereby amended and restated in its
entirety as follows:
"(b)(i) each Tranche B Term Loan Lender on the Restatement
Effective Date severally agrees to purchase a term loan (an
"Original Tranche B Term Loan") from the Original Lenders on
the Restatement Effective Date in an amount not to exceed the
amount of the Tranche B Term Loan Commitment of such Lender on
the Restatement Effective Date and (ii) subject to the terms
and conditions of the First Amendment, each Lender having an
Additional Tranche B Term Loan Commitment severally agrees to
make a term loan on the Colorado Acquisition Closing Date (an
"Additional Tranche B Term Loan" and, collectively with any
Original Tranche B Term Loan, a "Tranche B Term Loan") in an
amount not to exceed the amount of the Additional Tranche B
Term Loan Commitment of such Lender on the Colorado
Acquisition Closing Date."
(f) Effective on the Additional Tranche B Effective Date,
Section 2.2 of the Credit Agreement is hereby amended and restated in its
entirety as follows:
"2.2 Procedure for Term Loan Assignment/Borrowing. (i) The
Borrower shall give the Administrative Agent irrevocable
notice (which notice must be received by the Administrative
Agent prior to 1O:OO A.M., New York City time, one Business
Day prior to the anticipated Restatement Effective Date)
requesting that the Term Loan Lenders purchase the Term Loans
(other than the Additional Tranche B Term Loans) on the
Restatement Effective Date and specifying the amount of Term
Loans available for purchase. The Term Loans purchased by the
Lenders on the Restatement Effective Date shall initially be
Base Rate Loans, and prior to the Syndication Date, no Term
Loan may be converted into or continued as a Eurodollar Loan
having an Interest Period in excess of one month. Upon receipt
of such notice the Administrative Agent shall promptly notify
each Term Loan Lender thereof. Not later than 12:OO Noon, New
York City time, on the Restatement Effective Date each Term
Loan Lender shall make available to the Administrative Agent
at the Funding Office an amount in immediately available funds
equal to the Term Loan or Term Loans to be acquired by such
Lender.
(ii) The Borrower shall give the Administrative Agent
irrevocable Notice of Borrowing (which notice must be received
by the Administrative Agent prior to 12:OO Noon, New York City
time, one Business Day prior to the anticipated Colorado
Acquisition Closing Date) certifying that the Colorado
Acquisition will be consummated on such date pursuant to its
terms and requesting that the Additional Tranche B Term Loan
Lenders make the Additional Tranche B Term Loans on the
Colorado Acquisition Closing Date and specifying the amount to
be borrowed. The Additional Tranche B Term Loans made on the
Closing Date shall initially be Base Rate Loans. Upon receipt
of such notice the Administrative Agent shall promptly notify
each Additional Tranche B Term Loan Lender thereof. Not later
than 12:OO Noon, New York City time, on the Colorado
Acquisition Closing Date each Additional Tranche B Term Loan
Lender shall make available to the Administrative Agent at the
Funding Office an amount in immediately available funds equal
to the
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Additional Tranche B Term Loan to be made by such Lender. The
Administrative Agent shall make available to the Borrower the
aggregate of the amounts made available to the Administrative
Agent by the Additional Tranche B Term Loan Lenders in like
funds. Additional Tranche B Term Loan Commitments not funded
on the Colorado Acquisition Closing Date will terminate.
(g) Effective on the Additional Tranche B Effective Date,
Section 2.3(b) of the Credit Agreement is hereby amended and restated in its
entirety as follows:
"(b) The Tranche B Term Loan of each Tranche B Term
Loan Lender shall mature in 24 consecutive quarterly
installments, commencing on June 30, 2002, each of which shall
be in an amount equal to such Lender's Tranche B Term Loan
Percentage multiplied by the amount set forth below opposite
such installment:
Installment Principal Amount
----------- ----------------
June 30, 2002 $ 1,412,500
September 30, 2002 $ 1,412,500
December 31, 2002 $ 1,412,500
March 31, 2003 $ 1,487,500
June 30, 2003 $ 1,487,500
September 30, 2003 $ 1,487,500
December 31, 2003 $ 1,487,500
March 31, 2004 $ 1,487,500
June 30, 2004 $ 1,487,500
September 30, 2004 $ 1,487,500
December 31, 2004 $ 1,487,500
March 31, 2005 $ 1,487,500
June 30, 2005 $ 1,487,500
September 30, 2005 $ 1,487,500
December 31, 2005 $ 1,487,500
March 31, 2006 $ 1,487,500
June 30, 2006 $ 1,487,500
September 30, 2006 $ 1,487,500
December 31, 2006 $ 1,487,500
March 31, 2007 $ 1,487,500
June 30, 2007 $1 13,095,000
September 30, 2007 $1 13,095,000
December 31, 2007 $ 169,642,500
March 31, 2008 $ 169,642,500"
(h) Effective on the Additional Tranche B Effective Date,
Section 4.16 of the Credit Agreement is hereby amended by adding the following
new sentence at the end thereof:
"The Proceeds of the Additional Tranche B Term Loans shall be
used to pay a portion of the purchase price of the Colorado
Acquisition and to pay related fees and expenses."
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4. CONDITIONS TO EFFECTIVENESS. The effectiveness of the consent contained
in Section 1 of this Amendment and of the amendments contained in Section 2 of
this Amendment are conditioned upon satisfaction of the following conditions
precedent (the date on which all such conditions have been satisfied being
referred to herein as the "First Amendment Effective Date"):
(a) (i) Each Properties Group Party shall have duly
executed and delivered (1) an Assumption Agreement in the form attached hereto
as Annex 4 with respect to the Guarantee and Security Agreement and with respect
to the Mortgages encumbering the Real Estate transferred to it, (2) a
counterpart signature page to the Subordinated Intercompany Note and (3) any
other documentation required under, or requested by the Administrative Agent
pursuant to, Section 6.10 of the Credit Agreement or otherwise, all in form and
substance reasonably satisfactory to the Administrative Agent (any documentation
delivered to the Administrative Agent pursuant to this clause (i), the
"Properties Group Loan Documents"), (ii) the Governing Documents of each
Properties Group Party shall be reasonably satisfactory in form and substance to
the Administrative Agent and (iii) all aspects of the Colorado Acquisition and
the Real Property Transfers, and all documentation related thereto, shall be
reasonably satisfactory to the Administrative Agent;
(b) the Administrative Agent shall have received signed
written authorization from the requisite Lenders to execute this Amendment, and
shall have received counterparts of this Amendment signed by the Borrower, and
counterparts of the consent of the Guarantors attached hereto as Annex 5 (the
"Consent") executed by each of the Guarantors (as defined in the Guarantee and
Security Agreement);
(c) each of the representations and warranties in Section
6 below shall be true and correct in all material respects on and as of the
First Amendment Effective Date;
(d) the Administrative Agent shall have received a
modified ALTA-11 endorsement from the Title Insurance Company for each of its
mortgagee's title insurance policies relating to the Mortgages;
(e) the Administrative Agent shall have received payment
in immediately available funds of all expenses incurred by the Administrative
Agent (including, without limitation, legal fees) for which invoices have been
presented, on or before the Amendment Effective Date;
(f) the Borrower shall have paid to each of the Lenders
executing this Amendment by December 18,2002 an amendment fee equal to the
product of 0.1% multiplied by the amount of each such Lender's Commitment;
(g) the Administrative Agent shall have received the
executed legal opinions of (i) each of Stokes, Bartholomew, ▇▇▇▇▇ & ▇▇▇▇▇▇,
Miles & Stockbridge and ▇▇▇▇ ▇▇▇▇▇▇▇ LLP counsel to the Borrower and its
Subsidiaries regarding customary matters (including, without limitation, the
enforceability of this Amendment, the Credit Agreement, as amended, and the
Properties Group Loan Documents against all parties thereto, and no conflict
with law or material agreements) and (ii) such local counsel as the
Administrative Agent shall request regarding the continued enforceability of the
Mortgages and other customary matters;
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(h) the Administrative Agent shall have received such
other documents, instruments, certificates, opinions and approvals as it may
reasonably request.
5. CONDITIONS TO EFFECTIVENESS OF OTHER AMENDMENTS.
The effectiveness of the amendments contained in Section 3 of
this Amendment and of the requirement to fund the Additional Tranche B Term
Loans on the Colorado Acquisition Closing Date are conditioned upon satisfaction
of the following conditions precedent (the date on which all such conditions
have been satisfied being referred to herein as the "Additional Tranche B
Effective Date"):
(a) the Administrative Agent shall have received an
irrevocable written request from the Borrower, such notice to be received by the
Administrative Agent at least five Business Days prior to the anticipated
Colorado Acquisition Closing Date, to obtain the Additional Tranche B Term Loan
Commitments in connection with the expected consummation of the Colorado
Acquisition;
(b) each of the representations and warranties in Section
6 below shall be true and correct in all material respects on and as of the
Additional Tranche B Effective Date and, with respect to the requirement of the
Additional Tranche B Term Loan Lenders to fund the Additional Tranche B Term
Loans, on the Colorado Acquisition Closing Date;
(c) the Administrative Agent shall have received (i)
additional commitments from banks and other financial institutions with respect
to the Additional Tranche B Term Loans in an aggregate principal amount equal to
$30,000,000 and (ii) if any such bank or financial institution is not a Lender,
a fully executed Lender Addendum with respect to each such bank or other
financial institution committing to fund such Additional Tranche B Term Loans
(and pursuant to which on the Additional Tranche B Effective Date such bank or
other financial institution shall become a Tranche B Term Loan Lender for all
purposes under the Credit Agreement and the other Loan Documents);
(d) the Administrative Agent shall have received payment
in immediately available funds of all expenses incurred by the Administrative
Agent (including, without limitation, legal fees) for which invoices have been
presented, on or before the Additional Tranche B Effective Date;
(e) the Borrower shall have paid to each of the Lenders
with Additional Tranche B Term Loan Commitments any applicable fees; and
(f) the Administrative Agent shall have received such
other documents, instruments, certificates, opinions and approvals as it may
reasonably request.
6. REPRESENTATIONS AND WARRANTIES. The Borrower represents and warrants to
the Administrative Agent and the Lenders as follows:
(a) Authority. The Borrower has the requisite corporate
power and authority to execute and deliver this Amendment and to perform its
obligations hereunder and under the Credit Agreement (as modified hereby). Each
of the Guarantors has the requisite corporate power and
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authority to execute and deliver the Consent. Each Properties Group Party will
have the requisite corporate power and authority to execute the Properties Group
Loan Documents to which it is a party. The execution, delivery and performance
(i) by the Borrower of this Amendment and the Credit Agreement (as modified
hereby) and the transactions contemplated hereby and thereby, (ii) by the
Guarantors of the Consent and (iii) by each Properties Group Party of the
Properties Group Loan Documents to which it is a party, in each case, have been
(or will be with respect to any Properties Group Party) duly approved by all
necessary corporate action of such Person and no other corporate proceedings on
the part of each such Person are necessary to consummate such transactions.
(b) Enforceability. This Amendment has been duly executed
and delivered by the Borrower. The Consent has been duly executed and delivered
by each of the Guarantors. Each of the Properties Group Loan Documents has been
duly executed and delivered by each Properties Group Party party thereto. Each
of this Amendment, the Consent, the Properties Group Loan Documents and, after
giving effect to this Amendment, the Credit Agreement and the other Loan
Documents, (i) is the legal, valid and binding obligation of each Loan Party or
other Subsidiary of the Borrower party hereto and thereto (including, without
limitation, as applicable, any Properties Group Party), enforceable against such
Loan Party or other Subsidiary in accordance with its terms, except as may be
limited by general equitable principals (whether enforcement is sought by
proceedings in equity or at law) and (ii) is in full force and effect. Neither
the execution, delivery or performance of this Amendment, of the Consent, of the
Properties Group Loan Documents or of the Credit Agreement (as modified hereby),
nor the performance of the transactions contemplated hereby or thereby, will
adversely affect the validity, perfection or priority of the Administrative
Agent's Lien on any of the Collateral or its ability to realize thereon.
(c) Representations and Warranties. After giving effect
to this Amendment, the representations and warranties contained in the Credit
Agreement and the other Loan Documents (other than any such representations and
warranties that, by their terms, are specifically made as of a date other than
the date hereof) are true and correct in all material respects on and as of the
date hereof as though made on and as of the date hereof.
(d) No Conflicts. Neither the execution and delivery of
this Amendment, the Consent, the Properties Group Loan Documents or the Credit
Agreement (as modified hereby), nor the consummation of the transactions
contemplated hereby and thereby, nor the performance of and compliance with the
terms and provisions hereof or thereof by any Loan Party or other Subsidiary of
the Borrower (including, without limitation, as applicable, any Properties Group
Party) will, at the time of such Performance, (a) violate or conflict with any
provision of its articles or certificate of incorporation or bylaws or other
organizational or governing documents of such Person, (b) violate, contravene or
materially conflict with any Requirement of Law or any other law, regulation
(including, without limitation, Regulation U or Regulation X), order, writ,
judgment, injunction, decree or permit applicable to it, except for any
violation, contravention or conflict which could not reasonably be expected to
have a Material Adverse Effect, (c) (i) violate, contravene or conflict with the
contractual provisions of, or cause an event of default under, any Loan Document
or (ii) violate, contravene or conflict with the contractual provisions of, or
cause an event of default under any other loan agreement, indenture, mortgage,
deed of trust, contract or other agreement or instrument to which it is a party
or by which it may be bound or (d) result in or require the creation of any Lien
(other than those contemplated in or created in connection with the
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Loan Documents) upon or with respect to its properties. No consent or
authorization of, filing with, notice to or other act by or in respect of, any
Governmental Authority or any other Person is required in connection with the
transactions contemplated hereby (including, without limitation, the transfer of
ownership of the Real Estate), except the filings referred to in the revised
Schedule 4.19(a)-l attached hereto.
(e) No Default. Both before and after giving effect to
this Amendment and the transactions contemplated hereby, no event has occurred
and is continuing that constitutes a Default or Event of Default.
(f) Solvency. Each Subsidiary of the Borrower (including,
without limitation, each Properties Group Party) is, and after giving effect to
(i) the Real Property Transfers, (ii) the assumption of the obligations and
liabilities by the Properties Group Parties of (x) a Guarantor and Grantor under
the Guarantee and Security Agreement and (y) of Grantor or Mortgagor under the
each of the Mortgages (as contemplated in the Assumption Agreement executed by
the Properties Group Parties) (iii) the incurrence of the Additional Tranche B
Term Loans and (iv) the other transactions contemplated hereby, will be,
Solvent.
7. REFERENCE TO AND EFFECT ON CREDIT AGREEMENT.
(a) Upon and after the effectiveness of this Amendment,
each reference in the Credit Agreement to "this Agreement", "hereunder",
"hereof" or words of like import referring to the Credit Agreement, and each
reference in the other Loan Documents to "the Credit Agreement", "thereunder",
"thereof" or words of like import referring to the Credit Agreement, shall mean
and be a reference to the Credit Agreement as modified hereby. This Amendment is
a Loan Document.
(b) Except as specifically modified above, the Credit
Agreement and the other Loan Documents are and shall continue to be in full
force and effect and are hereby in all respects ratified and confirmed. Without
limiting the generality of the foregoing, the Security Documents and all of the
Collateral described therein do and shall continue to secure the payment of all
Obligations under and as defined therein, in each case as modified hereby.
(c) The execution, delivery and effectiveness of this
Amendment shall not, except as expressly provided herein, operate as a waiver of
any right, power or remedy of any Secured Party under any of the Loan Documents,
nor, except as expressly provided herein, constitute a waiver or amendment of
any provision of any of the Loan Documents.
8. RELIANCE. The Borrower hereby acknowledges and agrees that the Real
Property Transfers contemplated hereby are being consummated at the request of
the Borrower and at the time of their formation, the Properties Group Parties,
and in consenting and agreeing to this Amendment, the Lenders have relied upon
(i) each Property Group Party becoming a Guarantor and a Grantor under the
Guarantee and Security Agreement and a Grantor or Mortgagor under any other
applicable Security Documents, including, without limitation, the Mortgages,
(ii) the continuing validity, enforceability and first-priority of the security
interest created by the existing Mortgages in the Real Estate subject thereto
notwithstanding the transfer of fee ownership of any such Real Estate to
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any Properties Group Party, (iii) the Real Property Transfers being consummated
subject to and subordinate to the Mortgages and (iv) the non-release of the
Borrower from any of its obligations as Grantor or Mortgagor under the Security
Documents, including without limitation, the Mortgages.
9. COUNTERPARTS. This Amendment may be executed in any number of
counterparts and by different parties hereto in separate counterparts, each of
which when so executed and delivered shall be deemed to be an original and all
of which taken together shall constitute one and the same agreement. Delivery of
an executed counterpart of a signature page to this Amendment by facsimile shall
be effective as delivery of a manually executed counterpart of this Amendment.
10. SEVERABILITY. Any provision of this Amendment that is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
11. GOVERNING LAW. This Amendment shall be governed by, and construed in
accordance with, the laws of the State of New York.
[Signature page follows]
12
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed by their respective officers thereunto duly authorized, as of the date
first written above.
CORRECTIONS CORPORATION OF AMERICA,
as Borrower
By: /s/ ▇▇▇▇ ▇.▇▇▇▇▇▇▇▇
--------------------------------
Name: ▇▇▇▇ ▇.▇▇▇▇▇▇▇▇
Title: Chief Executive Officer
and President
▇▇▇▇▇▇ COMMERCIAL PAPER, INC.,
as Administrative Agent
By:________________________________
Name:
Title:
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed by their respective officers thereunto duly authorized, as of the date
first written above.
CORRECTIONS CORPORATION OF AMERICA,
as Borrower
By:________________________________
Name:
Title:
▇▇▇▇▇▇ COMMERCIAL PAPER INC.,
as Administrative Agent
By: G.▇▇▇▇▇▇ ▇▇▇▇▇
--------------------------------
Name: G.▇▇▇▇▇▇ ▇▇▇▇▇
Title: Authorized Signatory
DEUTSCHE BANK SECURITIES INC., as
Co-Syndication Agent
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Managing Director
UBS WARBURG LLC, as
Co-Syndication Agent
By:________________________________
Name:
Title:
By:________________________________
Name:
Title:
SOCIETE GENERALE, as
Documentation Agent
By:________________________________
Name:
Title:
DEUTSCHE BANK SECURITIES INC., as
Co-Syndication Agent
By:________________________________
Name:
Title:
UBS WARBURG LLC, as
Co-Syndication Agent
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
--------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Director
By: /s/ ▇▇▇▇ C Cranoot
--------------------------------
Name: ▇▇▇▇ C Cranoot
Title: Director
SOCIETE GENERALE, as
Documentation Agent
By: _______________________________
Name:
Title:
DEUTSCHE BANK SECURITIES INC., as
Co-Syndication Agent
By: _______________________________
Name:
Title:
UBS WARBURG LLC, as
Co-Syndication Agent
By: _______________________________
Name:
Title:
By: _______________________________
Name:
Title:
SOCIETE GENERALE, as
Documentation Agent
By: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Vice President
Schedules, Exhibits and Annexes
Intentionally Omitted
ASSUMPTION AGREEMENT
ASSUMPTION AGREEMENT, dated as of December 27, 2002, made by
CCA Properties of America, LLC, a Tennessee limited liability company
("Properties I"), CCA Properties of Texas, L.P., a Delaware limited partnership
("Properties II"), CCA Properties of Arizona, LLC, a Tennessee limited liability
company ("Properties III") and CCA Properties of Tennessee, LLC, a Tennessee
limited liability company ("Properties IV" and, collectively with Properties I,
Properties II and Properties III, the "Additional Grantors"), in favor of ▇▇▇▇▇▇
Commercial Paper Inc., as administrative agent (in such capacity, the
"Administrative Agent") for (i) the banks and other financial institutions and
entities (the "Lenders") parties to the Credit Agreement referred to below, and
(ii) the other Secured Parties (as defined in the Guarantee and Security
Agreement (as hereinafter defined)). All capitalized terms not defined herein
shall have the meaning ascribed to them in such Credit Agreement.
W I T N E S S E T H:
WHEREAS, Corrections Corporation of America (the "Borrower"),
the Lenders, ▇▇▇▇▇▇ Brothers Inc., as advisor, lead arranger and book manager,
and, among others, the Administrative Agent have entered into a Third Amended
and Restated Credit Agreement, dated as of May 3, 2002 (as amended,
supplemented, replaced or otherwise modified from time to time, the "Credit
Agreement");
WHEREAS, in connection with the Credit Agreement, the Borrower
and certain of its Affiliates (other than the Additional Grantors) have entered
into the Second Amended and Restated Security Agreement (With Guarantee), dated
as of May 3, 2002 (as amended, supplemented or otherwise modified from time to
time, the "Guarantee and Security Agreement") in favor of the Administrative
Agent for the benefit of the Secured Parties;
WHEREAS, the Credit Agreement requires each Additional Grantor
to become a party to the Guarantee and Security Agreement; and
WHEREAS, each Additional Grantor has agreed to execute and
deliver this Assumption Agreement in order to become a party to the Guarantee
and Security Agreement;
WHEREAS, the Borrower has requested that the Lenders consent
to and agree to amend the Credit Agreement to provide, among other things, for
the transfers of the Borrower's Real Estate to the Additional Grantors, as more
specifically set forth therein, (the "First Amendment");
WHEREAS, pursuant to the First Amendment, the Lenders have
required that the Additional Grantors assume the obligations and liabilities of
the Borrower as grantor or mortgagor under each of the Mortgages;
NOW, THEREFORE, IT IS AGREED:
1. Guarantee and Security Agreement. By executing and
delivering this Assumption Agreement, each Additional Grantor, as provided in
Section 8.14 of the Guarantee
and Security Agreement, hereby becomes a party to the Guarantee and Security
Agreement as a Grantor thereunder with the same force and effect as if
originally named therein as a Grantor and, without limiting the generality of
the foregoing, hereby expressly assumes all obligations and liabilities of a
Grantor thereunder. The information set forth in Schedule A hereto is hereby
added to the information set forth in Schedules to the Guarantee and Security
Agreement, as more specifically set forth therein. Each Additional Grantor
hereby represents and warrants that each of the representations and warranties
contained in Section 4 of the Guarantee and Security Agreement is true and
correct on and as the date hereof (after giving effect to this Assumption
Agreement) as if made on and as of such date.
2. Assumption of Certain Mortgage Liabilities.
Reference is made to the Mortgages:
(a) Properties I hereby assumes all of the obligations
and liabilities, as well as all of the representations, warranties and
covenants, of the Grantor or Mortgagor (each as defined in the
respective Mortgages), as the case may be, arising under or with
respect to each Mortgage set forth on Part I of Schedule B hereto.
(b) Properties II hereby assumes all of the obligations
and liabilities, as well as all of the representations, warranties and
covenants, of the Grantor or Mortgagor (each as defined in the
respective Mortgages), as the case may be, arising under or with
respect to each Mortgage set forth on Part II of Schedule B hereto.
(c) Properties III hereby assumes all of the obligations
and liabilities, as well as all of the representations, warranties and
covenants, of the Grantor or Mortgagor (each as defined in the
respective Mortgages), as the case may be, arising under or with
respect to each Mortgage set forth on Part III of Schedule B hereto.
(d) Properties IV hereby assumes all of the obligations
and liabilities, as well as all of the representations, warranties and
covenants, of the Grantor or Mortgagor (each as defined in the
respective Mortgages), as the case may be, arising under or with
respect to each Mortgage set forth on Part IV of Schedule B hereto.
(e) Each Additional Grantor specifically understands that
each such Mortgage shall secure all obligations and liabilities arising
under this Assumption Agreement and the Guarantee and Security
Agreement as incorporated by reference hereby. Each Additional Grantor
agrees that "Event of Default," as used in the Mortgages, shall
include, without limitation, any default arising under this Agreement
or in the Guarantee and Security Agreement, provided that any
requirement for the giving of notice, the lapse of time, or both, has
been satisfied.
3. Reliance.
Each Additional Grantor hereby acknowledges and agrees that
the Real Property Transfers contemplated in the First Amendment and Consent to
the Third Amended and Restated Credit Agreement, dated as of December 27, 2002
(the "First Amendment") are being
consummated at the request of the Borrower and the Properties Group Parties, and
in consenting and agreeing to the First Amendment, the Lenders have relied upon
(i) each Properties Group Party becoming a Guarantor and a Grantor under the
Guarantee and Security Agreement and a Grantor or Mortgagor under any other
applicable Security Documents, including, without limitation, the Mortgages,
(ii) the continuing validity, enforceability and first-priority of the security
interest created by the existing Mortgages in the Real Estate subject thereto
notwithstanding the transfer of fee ownership of any such Real Estate to any
Property Group Party, (iii) the Real Property Transfers being consummated
subject to and subordinate to the Mortgages and (iv) the non-release of the
Borrower from any of its obligations as Grantor or Mortgagor under the Security
Documents, including without limitation, the Mortgages.
4. GOVERNING LAW. THIS ASSUMPTION AGREEMENT SHALL BE
GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE
STATE OF NEW YORK.
[Signature page follows]
IN WITNESS WHEREOF, the undersigned have caused this Assumption
Agreement to be duly executed and delivered as of the date first above written.
CCA PROPERTIES OF AMERICA, LLC
By: Corrections Corporation of America, a
Maryland corporation, its sole member
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Vice President, Treasurer
CCA PROPERTIES OF TEXAS, L.P.
By: CCA Properties of America, LLC, a
Tennessee limited liability company,
its General Partner
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Vice President, Treasurer
CCA PROPERTIES OF ARIZONA, LLC
By: CCA of Tennessee, Inc., a Tennessee
corporation, its sole member
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Vice President, Treasurer
CCA PROPERTIES OF TENNESSEE, LLC
By: CCA of Tennessee, Inc., a Tennessee
corporation, its sole member
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Vice President, Treasurer
Schedules Intentionally Omitted
CONSENT OF GUARANTORS
Each of the undersigned is a Guarantor of the Obligations of the Borrower under
the Credit Agreement and hereby (a) consents to the foregoing Amendment, (b)
acknowledges that (i) the Obligations have been increased by virtue of the
Additional Tranche B Term Loans and (ii) notwithstanding the execution and
delivery of the foregoing Amendment, the obligations of each of the undersigned
Guarantors are not impaired or affected and all guaranties given to the holders
of Obligations and all Liens granted as security for the Obligations continue in
full force and effect, and (c) confirms and ratifies its obligations under the
Guaranty and Security Agreement and each other Loan Document executed by it.
Capitalized terms used herein without definition shall have the meanings given
to such terms in the Amendment to which this Consent is attached or in the
Credit Agreement referred to therein, as applicable.
Each of the undersigned hereby acknowledges and agrees that the Real Property
Transfers contemplated in the foregoing Amendment are being consummated at the
request of the Borrower and at the time of their formation, the Properties Group
Parties, and in consenting and agreeing to the foregoing Amendment, the Lenders
have relied upon (i) each Properties Group Party becoming a Guarantor and a
Grantor under the Guarantee and Security Agreement and a Grantor or Mortgagor
under any other applicable Security Documents, including, without limitation,
the Mortgages, (ii) the continuing validity, enforceability and first-priority
of the security interest created by the existing Mortgages in the Real Estate
subject thereto notwithstanding the transfer of fee ownership of any such Real
Estate to any Properties Group Party, (iii) the Real Property Transfers being
consummated subject to and subordinate to the Mortgages and (iv) the non-release
of the Borrower from any of its obligations as Grantor or Mortgagor under the
Security Documents, including without limitation, the Mortgages.
[Signature Page Follows]
IN WITNESS WHEREOF, each of the undersigned has executed and delivered
this Consent of Guarantors as of the 27th day of December, 2002.
CCA OF TENNESSEE, INC.
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Vice President, Treasurer
PRISON REALTY MANAGEMENT, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Chief Executive Officer and
President
CCA INTERNATIONAL, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Chief Executive Officer and
President
TRANSCOR AMERICA, LLC
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Vice President, Treasurer
TECHNICAL AND BUSINESS INSTITUTE OF
AMERICA, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Chief Executive Officer and
President
[Signatures continue on following page]
CCA PROPERTIES OF AMERICA, LLC
By: Corrections Corporation of America, a
Maryland corporation, its sole member
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Vice President, Treasurer
CCA PROPERTIES OF TEXAS, L.P.
By: CCA Properties of America, LLC, a
Tennessee limited liability company,
its General Partner
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Vice President, Treasurer
CCA PROPERTIES OF ARIZONA, LLC
By: CCA of Tennessee, Inc., a Tennessee
corporation, its sole member
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Vice President, Treasurer
CCA PROPERTIES OF TENNESSEE, LLC
By: CCA of Tennessee, Inc., a Tennessee
corporation, its sole member
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Vice President, Treasurer
COUNTERPART SIGNATURE PAGE TO
ENDORSEMENT WITH RESPECT TO THE INTERCOMPANY SUBORDINATED
DEMAND PROMISSORY NOTE
IN WITNESS WHEREOF, each Payor has caused this Endorsement to the
Intercompany Subordinated Demand Promissory Note to be executed and delivered by
its proper and duly authorized officer as of December 27th, 2002.
CCA PROPERTIES OF AMERICA, LLC
By: Corrections Corporation of America, a
Maryland corporation, its sole member
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Vice President, Finance
CCA PROPERTIES OF TEXAS, L.P.
By: CCA Properties of America, LLC, a
Tennessee limited liability company, its
General Partner
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Vice President, Treasurer
CCA PROPERTIES OF ARIZONA, LLC
By: CCA of Tennessee, Inc., a Tennessee
corporation, its sole member
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Vice President, Treasurer
CCA PROPERTIES OF TENNESSEE, LLC
By: CCA of Tennessee, Inc., a Tennessee
corporation, its sole member
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Vice President, Treasurer
COUNTERPART SIGNATURE PAGE TO
INTERCOMPANY SUBORDINATED DEMAND PROMISSORY NOTE
IN WITNESS WHEREOF, each Payor has caused this Intercompany
Subordinated Demand Promissory Note to be executed and delivered by its proper
and duly authorized officer as of December 27th, 2002.
CCA PROPERTIES OF AMERICA, LLC
By: Corrections Corporation of America, a
Maryland corporation, its sole member
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Vice President, Finance
CCA PROPERTIES OF TEXAS, L.P.
By: CCA Properties of America, LLC, a
Tennessee limited liability company, its
General Partner
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Vice President, Treasurer
CCA PROPERTIES OF ARIZONA, LLC
By: CCA of Tennessee, Inc., a Tennessee
corporation, its sole member
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Vice President, Treasurer
CCA PROPERTIES OF TENNESSEE, LLC
By: CCA of Tennessee, Inc., a Tennessee
corporation, its sole member
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Vice President, Treasurer