EXHIBIT 10.1
Execution Version
$375,000,000
CORRECTIONS CORPORATION OF AMERICA
6 1/4% SENIOR NOTES DUE 2013
PURCHASE AGREEMENT
March 8, 2005
▇▇▇▇▇▇ BROTHERS INC.,
▇.▇. ▇▇▇▇▇▇ SECURITIES INC.
BANC OF AMERICA SECURITIES, LLC
As Representatives of the several Initial Purchasers
named in Schedule I c/▇
▇▇▇▇▇▇ Brothers Inc.
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
Corrections Corporation of America, a Maryland corporation (the
"Company"), proposes, upon the terms and considerations set forth herein, to
issue and sell to you, as the initial purchasers (the "Initial Purchasers"),
$375.0 million in aggregate principal amount of its 6-1/4% Senior Notes due 2013
(the "Notes"). The Initial Purchasers, acting severally and not jointly, propose
to purchase the respective principal amount of Notes set forth on Schedule I
attached hereto. The Notes will (i) have terms and provisions that are
summarized in the Offering Memorandum (as defined below) and (ii) are to be
issued pursuant to an Indenture dated March 23, 2005 (the "Indenture") to be
entered into among the Company, the Guarantors (as defined below) and U.S. Bank
National Association, as trustee (the "Trustee"). The Company's obligations
under the Notes, including the due and punctual payment of interest on the
Notes, will be unconditionally guaranteed (the "Guarantees") by the subsidiaries
listed in Schedule II hereto that have signed this Agreement, (together the
"Guarantors"). As used herein, the term "Notes" shall include the Guarantees,
unless the context otherwise requires. This is to confirm the agreement
concerning the purchase of the Notes from the Company by the Initial Purchasers.
1. Preliminary Offering Memorandum and Offering Memorandum. The Notes will
be offered and sold to the Initial Purchasers without registration under the
Securities Act of 1933, as amended (the "Securities Act"), in reliance on an
exemption pursuant to Section 4(2) under the Securities Act. The Company and the
Guarantors have prepared a preliminary offering memorandum, dated March 8, 2005
(the "Preliminary Offering Memorandum"), and an offering memorandum, dated March
8, 2005 (the "Offering Memorandum"), setting forth information regarding the
Company, the Guarantors, the Notes and the Exchange Notes (as defined herein),
the Guarantees and the Exchange Guarantees (as defined herein). The Company and
the Guarantors hereby confirm that they have authorized the use of the
Preliminary Offering
Memorandum and the Offering Memorandum in connection with the offering and
resale of the Notes by the Initial Purchasers in accordance with Section 3
hereof.
Any reference to the Preliminary Offering Memorandum or the Offering
Memorandum shall be deemed to refer to and include the Company's most recent
Annual Report on Form 10-K for the fiscal year ended December 31, 2004 and the
Company's Current Reports on Form 8-K, dated January 6, 2005, February 10, 2005,
February 23, 2005 and March 2, 2005, each as filed with the United States
Securities and Exchange Commission (the "Commission") pursuant to Section 13(a),
13(c) or 15(d) of the United States Securities Exchange Act of 1934, as amended
(the "Exchange Act"), on or prior to the date of the Preliminary Offering
Memorandum or the Offering Memorandum, as the case may be. Any reference to the
Preliminary Offering Memorandum or the Offering Memorandum, as the case may be,
as amended or supplemented, as of any specified date, shall also be deemed to
include any documents filed with the Commission pursuant to Section 13(a), 13(c)
or 15(d) of the Exchange Act after the date of the Offering Memorandum and prior
to the date on which the Notes offering is consummated. In no event, however,
will any of the information disclosed by the Company under Items 2.02 and 7.01
of any Current Report on Form 8-K that may from time to time be furnished with
the Commission be included in any reference to the Preliminary Offering
Memorandum or the Offering Memorandum, as the case may be. All documents filed
under the Exchange Act and so deemed to be included in the Preliminary Offering
Memorandum or the Offering Memorandum, as the case may be, or any amendment or
supplement thereto are hereinafter called the "Exchange Act Reports."
It is understood and acknowledged that upon original issuance thereof, and
until such time as the same is no longer required under the applicable
requirements of the Securities Act, the Notes (and all securities issued in
exchange therefore or, in substitution thereof) shall bear the following legend
(along with such other legends as the Initial Purchasers and their counsel deem
necessary):
"THE NOTES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE UNITED
STATES SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND MAY
NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT (A)(1) TO A
PERSON WHOM THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL
BUYER WITHIN THE MEANING OF RULE 144A UNDER THE SECURITIES ACT PURCHASING
FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER
IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (2) IN AN OFFSHORE
TRANSACTION COMPLYING WITH RULE 903 OR RULE 904 OF REGULATION S UNDER THE
SECURITIES ACT, (3) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER (IF AVAILABLE), (4) TO AN
INSTITUTIONAL ACCREDITED INVESTOR IN A TRANSACTION EXEMPT FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT OR (5) PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND (B) IN
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ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF THE STATES OF THE UNITED
STATES."
You have advised the Company that you will make offers (the "Exempt
Resales") of the Notes purchased by you hereunder on the terms set forth in the
Offering Memorandum, as amended or supplemented, solely to (i) persons whom you
reasonably believe to be "qualified institutional buyers" as defined in Rule
144A under the Securities Act ("QIBs") and (ii) outside the United States to
certain persons in offshore transactions in reliance on Regulation S under the
Securities Act. Those persons specified in clauses (i) and (ii) are referred to
herein as the ("Eligible Purchasers"). You will offer the Notes to Eligible
Purchasers initially at a price equal to 100% of the principal amount thereof.
Such price may be changed at any time without notice.
Holders (including subsequent transferees) of the Notes will have the
registration rights set forth in the registration rights agreement attached
hereto as Exhibit A (the "Registration Rights Agreement") among the Company, the
Guarantors and the Initial Purchasers to be dated March 23, 2005 (the "Closing
Date"), for so long as such Notes constitute "Transfer Restricted Securities"
(as defined in the Registration Rights Agreement). Pursuant to the Registration
Rights Agreement, the Company and the Guarantors will agree to file with the
Commission under the circumstances set forth therein, a registration statement
under the Securities Act (the "Exchange Offer Registration Statement") relating
to the Company's 6-1/4% Senior Notes due 2013 (the "Exchange Notes") and the
Guarantors' Exchange Guarantees (the "Exchange Guarantees" to be offered in
exchange for the Notes and the Guarantees. Such portion of the offering is
referred to as the "Exchange Offer."
2. Representations, Warranties and Agreements of the Company and the
Guarantors. The Company and each of the Guarantors, jointly and severally,
represent, warrant and agree as follows:
(a) When the Notes and Guarantees are issued and delivered pursuant
to this Agreement, such Notes and Guarantees will not be of the same class
(within the meaning of Rule 144A under the Securities Act) as securities of the
Company or any of the Guarantors that are listed on a national securities
exchange registered under Section 6 of the Exchange Act or that are quoted in a
United States automated inter-dealer quotation system.
(b) Neither the Company nor any of its subsidiaries is, or after
giving effect to the offering and sale of the Notes and upon application of the
net proceeds therefrom as described under the caption "Use of Proceeds" in the
Offering Memorandum will be, an "investment company" or a company "controlled"
by an "investment company" within the meaning of the Investment Company Act of
1940, as amended.
(c) The Company and each Guarantor has all requisite corporate,
limited liability company or limited partnership power and authority to enter
into the Registration Rights Agreement. The Registration Rights Agreement has
been duly authorized by the Company and each Guarantor and, when executed by the
Company and each Guarantor on the Closing Date in accordance with the terms
hereof and thereof, the Registration Rights Agreement will have been validly
executed and delivered by the Company and the Guarantors. When the Registration
Rights Agreement has been duly executed and delivered by the Company and each of
the
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Guarantors (assuming the due execution and delivery thereof by you), the
Registration Rights Agreement will be the legally valid and binding obligation
of the Company and each Guarantor in accordance with the terms hereof and
thereof, enforceable against the Company and each Guarantor in accordance with
its terms, except as such enforceability may be limited by bankruptcy,
insolvency, reorganization, moratorium and other similar laws relating to or
affecting creditor's rights and remedies generally, by general equitable
principles (regardless of whether such enforceability is considered in a
proceeding in equity or at law) and, as to rights of indemnification and
contribution, by principles of public policy and applicable laws, including but
not limited to federal and state securities laws.
(d) Assuming that your representations and warranties in Section
3(a) are true, the purchase and resale of the Notes pursuant hereto (including
pursuant to the Exempt Resales) is exempt from the registration requirements of
the Securities Act. No form of general solicitation or general advertising
within the meaning of Regulation D (including, but not limited to,
advertisements, articles, notices or other communications published in any
newspaper, magazine or similar medium or broadcast over television or radio, or
any seminar or meeting whose attendees have been invited by any general
solicitation or general advertising) was used or will be used by the Company,
the Guarantors, any of their affiliates or any of their respective
representatives (other than each of you, as to whom the Company and the
Guarantors make no representation) in connection with the offer and sale of the
Notes.
(e) No form of general solicitation or general advertising was used
by the Company, the Guarantors or any of their respective representatives (other
than each of you or any person acting on your behalf, as to whom the Company and
the Guarantors make no representation) with respect to Notes sold outside the
United States to non-U.S. persons (as defined in Rule 902 under the Securities
Act), by means of any directed selling efforts within the meaning of Rule 902
under the Securities Act, and the Company, any affiliate of the Company and any
person acting on its or their behalf (other than each of you, as to whom the
Company and the Guarantors make no representation) has complied with and will
implement the "offering restrictions" required by Rule 902.
(f) The Company is subject to Section 13 or 15(d) of the Exchange
Act.
(g) The Offering Memorandum with respect to the Notes has been
prepared by the Company and the Guarantors for use by the Initial Purchasers in
connection with the Exempt Resales. To the knowledge of the Company after
reasonable investigation, no order or decree preventing the use of the Offering
Memorandum, or any order asserting that the transactions contemplated by this
Agreement are subject to the registration requirements of the Securities Act has
been issued and no proceeding for that purpose has commenced or is pending or,
to the knowledge of the Company or any of the Guarantors is contemplated.
(h) The Preliminary Offering Memorandum, the Offering Memorandum and
the Exchange Act Reports as of their respective dates and the Offering
Memorandum, as amended or supplemented, as of the Closing Date, did not or will
not at any time contain any untrue statement of a material fact or omit to state
a material fact required to be stated therein or necessary in order to make the
statements made therein, in light of the circumstances under which they were
made, not misleading, except that this representation and warranty does not
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apply to statements in or omissions from the Preliminary Offering Memorandum and
Offering Memorandum made in reliance upon and in conformity with information
relating to the Initial Purchasers furnished to the Company in writing by or on
behalf of the Initial Purchasers expressly for use therein.
(i) The Registration Rights Agreement will conform to the
description thereof in the Offering Memorandum in all material respects.
(j) The market-related and customer-related data and estimates
included under the captions "Summary" and "Business" in the Offering Memorandum
are based on or derived from sources which the Company and the Guarantors
believe to be reliable and accurate in all material respects.
(k) The Company and each of its subsidiaries have been duly
organized and are validly existing as corporations, limited liability companies
or limited partnerships in good standing under the laws of their respective
jurisdictions of organization, are duly qualified to do business and are in good
standing as foreign corporations, limited liability companies or limited
partnerships in each jurisdiction in which their respective ownership or lease
of property or the conduct of their respective businesses requires such
qualification, except as would not, individually or in the aggregate, have a
material adverse effect on the consolidated financial position, stockholders'
equity, results of operations, business or prospects of the Company and its
subsidiaries, taken as a whole (a "Material Adverse Effect"), and have all
corporate, limited liability company or limited partnership power and authority,
as applicable, necessary to own or hold their respective properties and to
conduct the businesses in which they are presently engaged and none of the
subsidiaries of the Company (other than CCA of Tennessee, LLC., CCA Properties
of America LLC, CCA Properties of Texas LP; CCA Properties of Arizona LLC; and
CCA Properties of Tennessee LLC (collectively, the "Significant Subsidiaries"))
is a "significant subsidiary", as such term is defined in Rule 405 of the Rules
and Regulations.
(l) The Company has an authorized capitalization as set forth in the Offering
Memorandum, and all of the issued shares of capital stock of the Company have
been duly and validly authorized and issued, are fully paid and non-assessable
and conform to the description thereof contained in the Offering Memorandum; and
all of the issued shares of capital stock of each subsidiary of the Company have
been duly and validly authorized and issued and are fully paid and
non-assessable and are owned directly or indirectly by the Company, free and
clear of all liens, encumbrances, equities or claims except as set forth in the
Offering Memorandum.
(m) The Company and each Guarantor has all requisite corporate,
limited company or limited partnership power and authority to enter into the
Indenture. The Indenture has been duly and validly authorized by the Company and
each Guarantor, and upon its execution and delivery and, assuming due
authorization, execution and delivery by the Trustee, will constitute the valid
and binding agreement of the Company and each Guarantor, enforceable against the
Company and each Guarantor in accordance with its terms, except as such
enforceability may be limited by bankruptcy, fraudulent conveyance, insolvency,
reorganization, moratorium, and other laws relating to or affecting creditors'
rights generally and by general equitable principles; no qualification of the
Indenture under the Trust Indenture Act of 1939, as
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amended (the "1939 Act"), is required in connection with the offer and sale of
the Notes contemplated hereby or in connection with the Exempt Resales.
(n) The Indenture will conform to the description thereof in the
Offering Memorandum in all material respects.
(o) The Company has all requisite corporate power and authority to
issue and sell the Notes. The Notes have been duly and validly authorized by the
Company and, when duly executed by the Company in accordance with the terms of
the Indenture, assuming due authentication of the Notes by the Trustee, upon
delivery to the Initial Purchasers against payment therefor in accordance with
the terms of this Agreement, will be validly issued and delivered, and will
constitute valid and binding obligations of the Company entitled to the benefits
of the Indenture, enforceable against the Company in accordance with their
terms, except as such enforceability may be limited by bankruptcy, fraudulent
conveyance, insolvency, reorganization, moratorium, and other laws relating to
or affecting creditors' rights generally and by general equitable principles.
(p) The Notes will conform to the description thereof in the
Offering Memorandum in all material respects.
(q) The Company has all requisite corporate power and authority to
issue the Exchange Notes. The Exchange Notes have been duly and validly
authorized by the Company and if and when duly executed and authenticated in
accordance with the terms of the Indenture and issued and delivered in
accordance with the Exchange Offer provided for in the Registration Rights
Agreement, will constitute valid and binding obligations of the Company entitled
to the benefits of the Indenture, enforceable against the Company in accordance
with their terms, except as such enforceability may be limited by bankruptcy,
fraudulent conveyance, insolvency, reorganization, moratorium, and other laws
relating to or affecting creditors' rights generally and by general equitable
principles.
(r) Each Guarantor has all requisite corporate limited company or
limited partnership power and authority to issue the Guarantees. The Guarantees
have been duly and validly authorized by each Guarantor and when duly executed
and delivered by each Guarantor in accordance with the terms of the Indenture
and upon the due execution, authentication and delivery of the Notes in
accordance with the Indenture and the issuance of the Notes in the sale to the
Initial Purchasers contemplated by this Agreement, will constitute valid and
binding obligations of each Guarantor, enforceable against each Guarantor in
accordance with their terms, except as such enforceability of the Guarantors'
obligations thereunder may be limited by bankruptcy, fraudulent conveyance,
insolvency, reorganization, moratorium, and other laws relating to or affecting
creditors' rights generally and by general equitable principles.
(s) The Guarantees will conform to the description thereof in the
Offering Memorandum in all material respects.
(t) Each Guarantor has all requisite corporate limited company or
limited partnership power and authority to issue the Exchange Guarantees. The
Exchange Guarantees have been duly and validly authorized by each Guarantor and
if and when duly executed and
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delivered by each Guarantor in accordance with the terms of the Indenture and
upon the due execution and authentication of the Exchange Notes in accordance
with the Indenture and the issuance and delivery of the Exchange Notes in the
Exchange Offer contemplated by the Registration Rights Agreement, will
constitute valid and binding obligations of each Guarantor, entitled to the
benefits of the Indenture, enforceable against each Guarantor in accordance with
their terms, except as such enforceability of the Guarantors' obligations
thereunder may be limited by bankruptcy, fraudulent conveyance, insolvency,
reorganization, moratorium, and other laws relating to or affecting creditors'
rights generally and by general equitable principles.
(u) The Company and each Guarantor has all requisite corporate
limited company or limited partnership limited company or limited partnership
power and authority to enter into this Agreement. This Agreement has been duly
authorized, executed and delivered by the Company and the Guarantors.
(v) The issue and sale of the Notes and the Guarantees and the
execution, delivery and performance of this Agreement, the Indenture, the Notes,
the Guarantees, the Exchange Notes, the Exchange Guarantees, and compliance by
the Company and the Guarantors with all of the provisions of the Notes, the
Guarantees, the Exchange Notes, the Exchange Guarantees, the Indenture, the
Registration Rights Agreement, by the Company and each of the Guarantors, as
applicable, and this Agreement and the consummation of the transactions
contemplated hereby and thereby and the use of the net proceeds from the sale of
the Notes as described in the Offering Memorandum (i) will not conflict with or
result in a breach or violation of any of the terms or provisions of, or
constitute a default under, any indenture, mortgage, deed of trust, loan
agreement or other agreement or instrument to which the Company or any of its
subsidiaries is a party or by which the Company, or any of its subsidiaries is
bound or to which any of the property or assets of the Company or any of its
subsidiaries is subject, except where such conflict, breach, violation or
default would not have a Material Adverse Effect (ii) result in any violation of
the provisions of the charter or by-laws of the Company or any of its
subsidiaries or (iii) result in any violation of any statute or any order, rule
or regulation of any court or governmental agency or body having jurisdiction
over the Company or any of its subsidiaries or any of their properties or
assets, except where such conflict, breach, violation or default would not have
a Material Adverse Effect. Assuming the accuracy of the representations,
warranties and covenants of the Initial Purchasers in Section 3(a) hereof, no
consent, approval, authorization or order of, or filing, registration or
qualification with any such court or governmental agency or body is required for
the issue and sale of the Notes and the Guarantees or the consummation by the
Company and the Guarantors of the transactions contemplated by this Agreement,
the Registration Rights Agreement or the Indenture, except where the failure to
receive the required consent, approval, authorization, order, filing,
registration or qualification (other than as may be required under the federal
securities laws) would not have a Material Adverse Effect and except for the
filing of a registration statement by the Company with the Commission pursuant
to the Securities Act as required by the Registration Rights Agreement and such
consents, approvals, authorizations, orders, filings, registrations or
qualifications as may be required under state securities or Blue Sky laws in
connection with the purchase and distribution of the Notes by the Initial
Purchasers.
(w) There are no contracts, agreements or understandings between the
Company, any subsidiary and any person granting such person the right (other
than rights that
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have been waived or satisfied) to require the Company or any subsidiary to file
a registration statement under the Securities Act with respect to any securities
of the Company or any subsidiary owned or to be owned by such person or to
require the Company or any subsidiary to include such securities in the
securities registered pursuant to the Registration Rights Agreement or, except
for those registration rights as provided in the registration rights agreements,
dated December 31, 1998, as amended through the date hereof, by and between the
Company and PMI Mezzanine Fund, L.P., and the registration rights agreement,
dated as of December 31, 1998, by and between Correctional Management Services
Corporation, a predecessor of the Company, and CFE, Inc., in any securities
being registered pursuant to any other registration statement filed by the
Company or any Guarantor under the Securities Act.
(x) During the six-month period preceding the date of the Offering
Memorandum, none of the Company, the Guarantors or any other person acting on
behalf of the Company or any Guarantor has offered or sold to any person any
Notes or Guarantees, or any securities of the same or a similar class as the
Notes or Guarantees, other than Notes or Guarantees offered or sold to the
Initial Purchasers hereunder. The Company and each of the Guarantors will take
reasonable precautions designed to ensure that any offer or sale, direct or
indirect, in the United States or to any U.S. person (as defined in Rule 902
under the Securities Act), of any Notes or any substantially similar security
issued by the Company or any Guarantor, within six months subsequent to the date
on which the distribution of the Notes has been completed (as notified to the
Company by the Initial Purchasers), is made under restrictions and other
circumstances reasonably designed not to affect the status of the offer and sale
of the Notes in the United States and to U.S. persons contemplated by this
Agreement as transactions exempt from the registration provisions of the
Securities Act; including any sales pursuant to Rule 144A under, or Regulations
D or S of, the Securities Act.
(y) To our knowledge after reasonable investigation, neither the
Company, the Guarantors nor any of their respective subsidiaries has sustained,
since the date of the latest audited financial statements included incorporated
by reference in the Offering Memorandum, any loss or interference with its
business from fire, explosion, flood or other calamity, whether or not covered
by insurance, or from any labor dispute or court or governmental action, order
or decree, in each case otherwise than as set forth or contemplated in the
Offering Memorandum and except where such loss or interference would not have a
Material Adverse Effect; and, since such date, there has not been any change in
the capitalization or long-term debt of the Company. the Guarantors or any of
their respective subsidiaries or any development in or affecting the general
affairs, management, financial position, stockholders' equity or results of
operations of the Company, the Guarantors or any of their respective
subsidiaries, otherwise than as set forth or contemplated in the Offering
Memorandum or as would not have a Material Adverse Effect.
(z) The historical consolidated financial statements (including the
related notes and supporting schedules) included in the Offering Memorandum
comply in all material respects with the requirements of Regulation S X under
the Securities Act applicable to registration statements on Form S-1 under the
Securities Act and present fairly, in all material respects, the consolidated
financial condition and results of operations of the entities purported to be
shown thereby at the dates and for the periods indicated and have been prepared
in all material respects in conformity with U.S. generally accepted accounting
principles applied on a consistent basis throughout the periods presented.
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(aa) Ernst & Young LLP, who have certified certain financial
statements of the Company, whose report appears in the Offering Memorandum and
who have delivered the letter referred to in Sections 7(f) hereof, are
independent registered public accountants as required by the Securities Act and
the Rules and Regulations, and were independent accountants as required by the
Act and the Rules and Regulations during the periods covered by the financial
statements on which they reported contained in the Offering Memorandum.
(bb) Except as set forth or contemplated in the Offering Memorandum,
the Company, and each of its subsidiaries has good and valid title in fee simple
to all real property and good and valid title to all personal property owned by
them, in each case free and clear of all liens, encumbrances and defects except
such as are described in the Offering Memorandum or such as do not materially
affect the value of such property and do not materially interfere with the use
made of such property by the Company and each of its subsidiaries; and all real
property and buildings held under lease by the Company and each of its
subsidiaries are held by them under valid, subsisting and enforceable leases,
with such exceptions as are not material and do not interfere with the use made
of such property and buildings by the Company and its subsidiaries.
(cc) To their knowledge after reasonable investigation, the Company
and each of its respective subsidiaries carry, or are covered by, insurance in
such amounts and covering such risks as is adequate for the conduct of their
respective businesses and the value of their respective properties and as is
customary for companies engaged in similar businesses in similar industries.
(dd) The Company and each of its subsidiaries own or possess
adequate rights to use all material patents, patent applications, trademarks,
service marks, trade names, trademark registrations, service ▇▇▇▇ registrations,
copyrights and licenses necessary for the conduct of their respective businesses
except where the failure to own or possess such rights would not result in a
Material Adverse Effect, and have no knowledge after reasonable investigation
that the conduct of their respective businesses will conflict with, and have not
received any notice of any claim of conflict with, any such rights of others,
which individually or in the aggregate, would result in a Material Adverse
Effect.
(ee) Except as described in the Offering Memorandum, there are no
legal or governmental proceedings pending to which the Company, its Guarantors
or any of its subsidiaries is a party or of which any property or assets of the
Company or any of its subsidiaries is the subject which, if determined adversely
to the Company or any of its subsidiaries, would reasonably be expected to have
a Material Adverse Effect. To the Company's and each subsidiary's knowledge,
except as disclosed in the Offering Memorandum, no such proceedings are
threatened or contemplated by governmental authorities or threatened by others.
(ff) There are no contracts or other documents that as of the filing
date of the annual report on form 10-K would be required to be filed as exhibits
to a Company registration statement pursuant to Item 601(10) of Regulation S-K
that have not been so filed as of March 7, 2005.
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(gg) No relationship, direct or indirect, that would be required to
be described under Item 404 of Regulation S-K promulgated under the Act, exists
between or among the Company, any Guarantor on the one hand, and the directors,
officers, stockholders, customers or suppliers of the Company, or any Guarantor
on the other hand, other than as described in the Offering Memorandum.
(hh) No labor disturbance by the employees of the Company or any
subsidiary exists or, to the knowledge of the Company or any subsidiary, is
imminent which could reasonably be expected to have a Material Adverse Effect.
(ii) The Company is in compliance in all material respects with all
presently applicable provisions of the Employee Retirement Income Security Act
of 1974, as amended, including the regulations and published interpretations
thereunder ("ERISA"); no "reportable event" (as defined in ERISA) has occurred
with respect to any "pension plan" (as defined in ERISA) for which the Company
or any subsidiary would have any liability; neither the Company nor any
subsidiary has incurred and expects to incur liability under (i) Title IV of
ERISA with respect to termination of, or withdrawal from, any "pension plan" or
(ii) Sections 412 or 4971 of the Internal Revenue Code of 1986, as amended,
including the regulations and published interpretations thereunder (the "Code");
and each "pension plan" for which the Company or any subsidiary would have any
liability that is intended to be qualified under Section 401(a) of the Code is
so qualified in all material respects and nothing has occurred, whether by
action or by failure to act, which would cause the loss of such qualification,
except for such action or failure which would not result in a Material Adverse
Effect.
(jj) Set forth on Exhibit B hereto is a list of each employee
pension or benefit plan with respect to which the Company or any corporation
considered an affiliate of the Company within the meaning of Section 407(d)(7)
of ERISA is a party in interest or disqualified person.
(kk) Except as described in the Offering Memorandum, the Company and
each of the subsidiaries has filed all federal, state and local income and
franchise tax returns required to be filed (subject to extensions of time for
the proper filing of such returns) through the date hereof and has paid all
taxes as set forth in such returns, and no tax deficiency has been determined
adversely to the Company, or any of its subsidiaries (nor does the Company or
any of its subsidiaries have any knowledge of any tax deficiency) which, if
determined adversely to the Company or any of its subsidiaries, might reasonably
be expected to have a Material Adverse Effect.
(ll) Since the date as of which information is given in the Offering
Memorandum through the date hereof, and except as may otherwise be disclosed in
the Offering Memorandum or the Exchange Act Reports, neither the Company nor any
Guarantor has (i) issued or granted any securities not otherwise in the ordinary
course of business, (ii) incurred any material liability or obligation, direct
or contingent, other than liabilities and obligations which were incurred in the
ordinary course of business, (iii) entered into any material transaction not in
the ordinary course of business or (iv) declared or paid any dividend on its
capital stock not otherwise in the ordinary course of business.
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(mm) The Company and each of its subsidiaries (i) makes and keeps
accurate books and records and (ii) maintains internal accounting controls which
provide reasonable assurance that (A) transactions are executed in accordance
with management's authorization, (B) transactions are recorded as necessary to
permit preparation of its financial statements and to maintain accountability
for its assets and (C) the reported accountability for its assets is compared
with existing assets at reasonable intervals.
(nn) Neither the Company nor any of its subsidiaries (i) is in
violation of its charter or by-laws, (ii) is in default and no event has
occurred which, with notice or lapse of time or both, would constitute such a
default, in the due performance or observance of any term, covenant or condition
contained in any material indenture, mortgage, deed of trust, loan agreement or
other agreement or instrument to which it is a party or by which it is bound or
to which any of its properties or assets is subject or (iii) except as described
in the Offering Memorandum is in violation of any law, ordinance, governmental
rule, regulation or court decree to which it or its property or assets may be
subject or has failed to obtain any material license, permit, certificate,
franchise or other governmental authorization or permit necessary to the
ownership of its property or to the conduct of its business, except, with regard
to (ii) and (iii) of this paragraph, for such defaults, violations or failures
that would not reasonably be expected to have a Material Adverse Effect.
(oo) To the knowledge of the Company after reasonable investigation,
neither the Company nor any of its subsidiaries, nor any director, officer,
agent, employee or other person associated with or acting on behalf of the
Company or any of its subsidiaries, has used any corporate funds for any
unlawful contribution, gift, entertainment or other unlawful expense relating to
political activity; made any direct or indirect unlawful payment to any foreign
or domestic government official or employee from corporate funds; violated or is
in violation of any provision of the Foreign Corrupt Practices Act of 1977; or
made any bribe, rebate, payoff, influence payment, kickback or other unlawful
payment.
(pp) The Company has established and maintains disclosure controls
and procedures (as such term is defined in Rule 13a-14 under the Exchange Act),
which (i) are designed to ensure that material information relating to the
Company, including its consolidated subsidiaries, is made known to the Company's
principal executive officer and its principal financial officer by others within
those entities, particularly during the periods in which the periodic reports
required under the Exchange Act are being prepared; (ii) have been evaluated for
effectiveness as of a date within 90 days prior to the filing of the Company's
most recent annual or quarterly report filed with the Commission; and (iii) are
effective in all material respects to perform the functions for which they were
established.
(qq) Based on the evaluation of its disclosure controls and
procedures, the Company is not aware of (i) any significant deficiency in the
design or operation of internal controls which could adversely affect the
Company's ability to record, process, summarize and report financial data or any
material weaknesses in internal controls, except as disclosed in the Offering
Memorandum; or (ii) any fraud, whether or not material, that involves management
or other employees who have a significant role in the Company's internal
controls.
11
(rr) Since the date of the most recent evaluation of such disclosure
controls and procedures, there have been no significant changes in internal
controls or in other factors that could significantly affect internal controls,
including any corrective actions with regard to significant deficiencies and
material weaknesses.
(ss) The Company and, to the best of its knowledge, its officers and
its directors are in compliance in all material respects with applicable
provisions of the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 and the rules and regulations
promulgated in connection therewith that are effective as of the date hereof.
(tt) There has been no storage, disposal, generation, manufacture,
refinement, transportation, handling or treatment of toxic wastes, medical
wastes, hazardous wastes or hazardous substances by the Company or any of its
subsidiaries (or, to the knowledge of the Company or any of its subsidiaries or
any of their predecessors in interest) upon or from any of the property now or
previously owned or leased by the Company or any of its subsidiaries in
violation of any applicable law, ordinance, rule, regulation, order, judgment,
decree or permit or which would require remedial action under any applicable
law, ordinance, rule, regulation, order, judgment, decree or permit, except for
any violation or remedial action which would not have, or could not be
reasonably likely to have, singularly or in the aggregate with all such
violations and remedial actions, a Material Adverse Effect; there has been no
material spill, discharge, leak, emission, injection, escape, dumping or release
of any kind onto such property or into the environment surrounding such property
of any toxic wastes, medical wastes, solid wastes, hazardous wastes or hazardous
substances due to or caused by the Company or any of its subsidiaries or with
respect to which the Company or any of its subsidiaries have knowledge, except
for any such spill, discharge, leak, emission, injection, escape, dumping or
release which would not have or would not be reasonably likely to have,
singularly or in the aggregate with all such spills, discharges, leaks,
emissions, injections, escapes, dumpings and releases, a Material Adverse
Effect; and the terms "hazardous wastes", "toxic wastes", "hazardous substances"
and "medical wastes" shall have the meanings specified in any applicable local,
state, federal and foreign laws or regulations with respect to environmental
protection.
(uu) The market-related and customer-related data and estimates
included under the captions "Summary" and "Business" in the Offering Memorandum
are based on or derived from sources which the Company believes to be reliable
and accurate in all material respects.
(vv) During the six-month period preceding the date of the Offering
Memorandum, neither the Company nor any of its subsidiaries nor any of their
respective affiliates has taken any action which is designed to or which has
constituted stabilization or manipulation of the price of any security of the
Company, the Guarantors or any of their respective subsidiaries in connection
with the offering of the Notes.
(ww) The statements set forth under the captions "Risk Factors -- We
are subject to legal proceedings associated with owning and managing
correctional detention facilities," "Our Company," "Business Development,"
"Business Strategy," "Certain U.S. Federal Income Tax Considerations" and "ERISA
Considerations" in the Offering Memorandum insofar as they
12
purport to describe the provisions of the laws and documents referred to
therein, are accurate in all material respects.
(xx) No Restricted Subsidiary (as defined in the Indenture) of the
Company is currently prohibited, directly or indirectly, from paying any
dividends to the Company, from making any other distribution on such Restricted
Subsidiary's capital stock, from repaying to the Company any loan or advances to
such Restricted Subsidiary from the Company or from transferring any of such
Restricted Subsidiary's property or assets to the Company or any other
Restricted Subsidiary of the Company, except as described in or contemplated by
the Offering Memorandum or pursuant to the provisions of (1) that certain
indenture, dated May 3, 2002, governing the Company's 9.875% Senior Notes due
2009, (2) that certain indenture, dated May 7, 2003, governing the Company's
7.50% Senior Notes due 2011, and (3) the Credit Agreement.
(yy) None of the transactions contemplated by this Agreement
(including without limitation, the use of the proceeds from the sale of the
Notes), will violate or result in a violation of Section 7 of the Exchange Act,
or any regulation promulgated thereunder, including, without limitation,
Regulations T, U, and X of the Board of Governors of the Federal Reserve System.
(zz) Immediately after each of the Guarantors has entered into the
Guarantee to which it is a party, (i) the fair value of the assets of such
Guarantor will exceed the debts and liabilities, subordinated, contingent or
otherwise, of such Guarantor, (ii) the present fair saleable value of the
property of such Guarantor will be greater than the amount that will be required
to pay the probable liabilities of such Guarantor on its debts and other
liabilities, subordinated, contingent or otherwise, as such debts and other
liabilities, subordinated, contingent or otherwise, become absolute and matured,
(iii) such Guarantor will be able to pay its debts and other liabilities,
subordinated, contingent or otherwise, as such debts and other liabilities
become absolute and matured, and (iv) such Guarantor will not have an
unreasonably small capital with which to conduct the business in which it is
engaged as such business is conducted and is proposed to be conducted following
the Delivery Date.
Neither the Company nor any of its subsidiaries intend, or intends
to permit any of its respective subsidiaries, to incur debts beyond its ability
to pay such debts as they mature, taking into account the timing and the amounts
of cash to be received by the Company or any of its subsidiaries and the timing
and the amounts of cash to be payable on or in respect of the Company's
indebtedness or the indebtedness of each subsidiary.
(aaa) Neither the Company nor any of its affiliates does business
with the government of Cuba or with any person or affiliate located in Cuba
within the meaning of Section 517.075, Florida Statutes.
(bbb) The Exchange Act Reports, when they were or are filed with the
Commission, conformed or will conform in all material respects to the applicable
requirements of the Exchange Act and the applicable rules and regulations (the
"Rules and Regulations") of the Commission thereunder.
3. Purchase and Resale of the Notes by the Initial Purchasers
13
(a) The Company and the Guarantors, jointly and severally hereby
agree, on the basis of the representations, warranties and agreements of the
Initial Purchasers contained herein and subject to all the terms and conditions
set forth herein, to issue and sell to the Initial Purchasers and, upon the
basis of the representations, warranties and agreements of the Company and the
Guarantors herein contained and subject to all the terms and conditions set
forth herein, each Initial Purchaser agrees, severally and not jointly, to
purchase from the Company, at a purchase price of 6-1/4% of the principal amount
thereof, the total principal amount of Notes set forth opposite the name of such
Initial Purchaser in Schedule I hereto. The Company and the Guarantors shall not
be obligated to deliver any of the securities to be delivered hereunder except
upon payment for all of the Notes to be purchased as provided herein and,
provided further, the Company and the Guarantors' obligation to deliver any of
the securities hereunder is subject to the success of the Tender Offer as
determined on the Consent Date (each as defined in the Company's Offer to
Purchase and Consent Solicitation Statement, dated March 8, 2005).
(b) Each of the Initial Purchasers, severally and not jointly hereby
represents and warrants to the Company that it will offer the Notes for sale
upon the terms and conditions set forth in this Agreement and in the Offering
Memorandum. Each of the Initial Purchasers hereby represents and warrants to,
and agrees with, the Company that such Initial Purchaser: (i) is a QIB with such
knowledge and experience in financial and business matters as are necessary in
order to evaluate the merits and risks of an investment in the Notes; (ii) is
purchasing the Notes pursuant to a private sale exempt from registration under
the Securities Act; (iii) in connection with the Exempt Resales, will solicit
offers to buy the Notes only from, and will offer to sell the Notes only to, the
Eligible Purchasers in accordance with this Agreement and on the terms
contemplated by the Offering Memorandum; and (iv) will not offer or sell the
Notes, nor has it offered or sold the Notes by, or otherwise engaged in, any
form of general solicitation or general advertising (within the meaning of
Regulation D, including, but not limited to, advertisements, articles, notices
or other communications published in any newspaper, magazine, or similar medium
or broadcast over television or radio, or any seminar or meeting whose attendees
have been invited by any general solicitation or general advertising) in
connection with the offering of the Notes. The Initial Purchasers have advised
the Company that they will offer the Notes to Eligible Purchasers at a price
initially equal to 100% of the principal amount thereof, plus accrued interest,
if any, from the date of issuance of the Notes. Such price may be changed by the
Initial Purchasers at any time thereafter without notice.
Each of the Initial Purchasers understands that the Company and, for
purposes of the opinions to be delivered to the Initial Purchasers pursuant to
Sections 7(c) and 7(d) hereof, counsel to the Company and counsel to the Initial
Purchasers, will rely upon the accuracy and truth of the foregoing
representations, warranties and agreements and the Initial Purchasers hereby
consent to such reliance.
4. Delivery of and Payment for the Notes. Delivery of and payment for the
Notes shall be made at the office of ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇
▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ at 9:00 A.M., New York City time, on the Closing Date. The
place of closing for the Notes and the Closing Date may be varied by agreement
between the Initial Purchasers and the Company.
14
The Notes will be delivered to the Initial Purchasers, or the
Trustee as custodian for The Depository Trust Company ("DTC"), against payment
by or on behalf of the Initial Purchasers of the purchase price therefor by wire
transfer to such account or accounts as the Company shall specify prior to the
Closing Date or by such means as the parties hereto shall agree prior to the
Closing Date in immediately available funds, by causing DTC to credit the Notes
to the account of the Initial Purchasers at DTC. The Notes will be evidenced by
one or more global securities in definitive form (the "Global Notes") or by
additional definitive securities, and will be registered, in the case of the
Global Notes, in the name of Cede & Co. as nominee of DTC, and in the other
cases, in such names and in such denominations as the Initial Purchasers shall
request prior to 9:30 A.M., New York City time, on the second business day
preceding the Closing Date. The Notes to be delivered to the Initial Purchasers
shall be made available to the Initial Purchasers in New York City for
inspection and packaging not later than 9:30 A.M., New York City time, on the
business day next preceding the Closing Date.
5. Agreements of the Company and the Guarantors. The Company and the
Guarantors, jointly and severally agree with each of the Initial Purchasers as
follows:
(a) The Company and the Guarantors will furnish to the Initial
Purchasers without charge, as of the date of the Offering Memorandum, such
number of copies of the Offering Memorandum as may then be amended or
supplemented as it may reasonably request.
(b) The Company and the Guarantors will not make any amendment or
supplement to the Offering Memorandum, or file any Exchange Act Reports after
the date hereof and prior to the Closing Date, of which the Initial Purchasers
shall not previously have been advised or, with respect to any such amendment or
supplement to the Offering Memorandum, to which they shall reasonably object
after being so advised.
(c) Prior to the execution and delivery of this Agreement, the
Company and the Guarantors shall have delivered or will deliver to the Initial
Purchasers, without charge, in such quantities as the Initial Purchasers shall
have requested or may hereafter reasonably request, copies of the Offering
Memorandum. The Company and each of the Guarantors consent to the use of the
Offering Memorandum in accordance with the securities or Blue Sky laws of the
jurisdictions in which the Notes are offered by the Initial Purchasers and by
all dealers to whom Notes may be sold, in connection with the offering and sale
of the Notes
(d) If, at any time prior to completion of the distribution of the
Notes by the Initial Purchasers to Eligible Purchasers, any event shall occur or
that in the judgment of the Company, any of the Guarantors or in the opinion of
counsel for the Initial Purchasers, should be set forth in the Offering
Memorandum in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading, or if it is necessary
to supplement or amend the Offering Memorandum in order to comply with any law,
the Company and the Guarantors will, subject to subsection (b) above, forthwith
prepare an appropriate supplement or amendment thereto, and will expeditiously
furnish to the Initial Purchasers and dealers a reasonable number of copies
thereof.
(e) The Company and each of the Guarantors will cooperate with the
Initial Purchasers and with their counsel in connection with the qualification
of the Notes for offering
15
and sale by the Initial Purchasers and by dealers under the securities or Blue
Sky laws of such jurisdictions as the Initial Purchasers may designate and will
file such consents to service of process or other documents necessary or
appropriate in order to effect such qualification; provided, that in no event
shall the Company or any of the Guarantors be obligated to qualify to do
business in any jurisdiction where it is not now so qualified or to take any
action that would subject it to service of process in suits, other than those
arising out of the offering or sale of the Notes, in any jurisdiction where it
is not now so subject.
(f) For a period of 180 days from the date of the Offering
Memorandum, the Company and the Guarantors agree not to, directly or indirectly,
sell, offer to sell, contract to sell, grant any option to purchase, issue any
instrument convertible into or exchangeable for, or otherwise transfer or
dispose of (or enter into any transaction or device that is designed to, or
could be expected to, result in the disposition in the future of), any debt
securities of the Company, the Guarantors or any of their respective
subsidiaries, except (i) in exchange for the Exchange Notes and the Exchange
Guarantees in connection with the Exchange Offer or (ii) with the prior consent
of the Representatives.
(g) So long as the Notes are outstanding, unless such documents are
available to the Initial Purchasers via the Commission's website, ▇▇▇▇▇, to
furnish to the holders of the Notes as soon as practicable after the end of each
fiscal year an annual report (including a balance sheet and statements of
income, stockholders' equity and cash flows of the Company and its consolidated
subsidiaries certified by independent public accountants) and, as soon as
practicable after the end of each of the first three quarters of each fiscal
year (beginning with the fiscal quarter ending after the date of the Offering
Memorandum), will make available to its securityholders consolidated summary
financial information of the Company and its subsidiaries for such quarter in
reasonable detail.
(h) So long as any of the Notes are outstanding, unless such
documents are available to the Initial Purchasers via the Commission's website,
▇▇▇▇▇, the Company and the Guarantors will furnish to the Initial Purchasers (i)
as soon as reasonably available, a copy of each report of the Company or any
Guarantor mailed to stockholders generally or filed with any stock exchange or
regulatory body and (ii) from time to time such other information concerning the
Company or the Guarantors as the Initial Purchasers may reasonably request.
(i) If this Agreement shall terminate or shall be terminated after
execution and delivery pursuant to any provisions hereof (otherwise than by
notice given by the Initial Purchasers terminating this Agreement pursuant to
Section 10 hereof) or if this Agreement shall be terminated by the Initial
Purchasers because of any failure or refusal on the part of the Company or any
of the Guarantors to comply with the terms or fulfill any of the conditions of
this Agreement, the Company and the Guarantors agree to reimburse the Initial
Purchasers for all out-of-pocket expenses (including reasonable fees and
expenses of its counsel) reasonably incurred by it in connection herewith, but
without any further obligation on the part of the Company or any of the
Guarantors for loss of profits or otherwise.
(j) The Company and the Guarantors will apply the net proceeds from
the sale of the Notes to be sold by it hereunder substantially in accordance
with the description set forth in the Offering Memorandum under the caption "Use
of Proceeds."
16
(k) Except as stated in this Agreement and in the Offering
Memorandum, neither the Company nor any of its subsidiaries has taken, nor will
any of them take, directly or indirectly, any action designed to result in
stabilization or manipulation of the price of any security of the Company or any
of the Guarantors to facilitate the sale or resale of the Notes and the
Guarantees. Except as permitted by the Securities Act, the Company and the
Guarantors will not distribute any offering material in connection with the
Exempt Resales.
(l) The Company and the Guarantors will use all commercially
reasonable efforts to permit the Notes to be designated Private Offerings,
Resales and Trading through Automated Linkages (PORTAL) Market(SM) (the "PORTAL
Market(SM)") securities in accordance with the rules and regulations adopted by
the National Association of Securities Dealers, Inc. relating to trading in the
PORTAL Market(SM) and to permit the Notes to be eligible for clearance and
settlement through DTC.
(m) From and after the Closing Date, so long as any of the Notes are
outstanding and are "restricted securities" within the meaning of the Rule
144(a)(3) under the Act or, if earlier, until three years after the Closing
Date, and during any period in which the Company is not subject to Section 13 or
15(d) of the Exchange Act, the Company and the Guarantors will furnish to
holders of the Notes and prospective purchasers of Notes designated by such
holders, upon request of such holders or such prospective purchasers, the
information required to be delivered pursuant to Rule 144A(d)(4) under the Act
to permit compliance with Rule 144A in connection with resale of the Notes.
(n) The Company and the Guarantors have complied and will comply
with all provisions of Florida Statutes Section 517.075 relating to issuers
doing business with Cuba.
(o) During the period of two years after the Closing Date, the
Company and the Guarantors will not, and will not permit any of their
"affiliates" (as defined in Rule 144 under the Securities Act), to, resell any
of the Notes that constitute "restricted securities" under Rule 144 that have
been reacquired by any of them.
(p) The Company and the Guarantors agree not to sell, offer for sale
or solicit offers to buy or otherwise negotiate in respect of any security (as
defined in the Securities Act) that would be integrated with the sale of the
Notes in a manner that would require the registration under the Securities Act
of the sale to the Initial Purchasers or the Eligible Purchasers of the Notes.
(q) The Company and the Guarantors agree to comply with all the
terms and conditions of the Registration Rights Agreement in all material
respects and all agreements set forth in the representation letters of the
Company and the Guarantors to DTC relating to the approval of the Notes by DTC
for "book entry" transfer.
(r) On the Closing Date, the Company will deliver to the Initial
Purchasers secretary's certificates reasonably satisfactory to the Initial
Purchasers which will include the following documents with respect to the
Company and each Guarantor: (i) charter, (ii) by-laws, (iii) other constitutive
documents, (iv) resolutions and (v) certificates of good standing and/or
17
qualification to do business as a foreign corporation in such jurisdiction as
the Initial Purchasers may reasonably request.
(s) The Company and the Guarantors agree to cause the Exchange Offer
to be made on the appropriate form, as contemplated by the Registration Rights
Agreement, to permit registration of the Exchange Notes and the Exchange
Guarantees to be offered in exchange for the Notes and the Guarantees,
respectively, and to comply with all applicable federal and state securities
laws in connection with the Exchange Offer.
(t) The Company and the Guarantors agree that prior to any
registration of the Notes pursuant to the Registration Rights Agreement, or at
such earlier time as may be required, the Indenture shall be qualified under the
1939 Act and any necessary supplemental indentures will be entered into in
connection therewith.
(u) The Company and the Guarantors will not voluntarily claim, and
will resist actively all attempts to claim, the benefit of any usury laws
against holders of the Notes.
(v) The Company and the Guarantors will do and perform all things
reasonably required or necessary to be done and performed under this Agreement
by them prior to the Closing Date, and to satisfy all conditions precedent to
the Initial Purchasers' obligations hereunder to purchase the Notes.
(w) The Company and the Guarantors will take such steps as shall be
necessary to ensure that neither the Company nor any subsidiary shall become an
"investment company" within the meaning of such term under the Investment
Company Act of 1940 and the rules and regulations of the Commission thereunder.
6. Expenses. Whether or not the transactions contemplated by this
Agreement are consummated or this Agreement becomes effective or is terminated,
the Company and the Guarantors, jointly and severally, agree, to pay all costs,
expenses, fees and taxes incident to and in connection with: (i) the
preparation, printing, filing and distribution of the Preliminary Offering
Memorandum and the Offering Memorandum (including, without limitation, financial
statements and exhibits) and all amendments and supplements thereto (including
the fees, disbursements and expenses of the Company's accountants and counsel,
but not, however, legal fees and expenses of the Initial Purchasers' counsel
incurred in connection therewith); (ii) the preparation, printing (including,
without limitation, word processing and duplication costs) and delivery of this
Agreement, the Indenture, the Registration Rights Agreement, all Blue Sky
Memoranda and all other agreements, memoranda, correspondence and other
documents printed and delivered in connection therewith and with the Exempt
Resales (but not, however, legal fees and expenses of the Initial Purchasers'
counsel incurred in connection with any of the foregoing other than fees of such
counsel plus reasonable disbursements incurred in connection with the
preparation, printing and delivery of such Blue Sky Memoranda); (iii) the
issuance and delivery by the Company of the Notes and by the Guarantors of the
Guarantees and any taxes payable in connection therewith; (iv) the qualification
of the Notes and Exchange Notes and Guarantees and Exchange Guarantees for offer
and sale under the securities or Blue Sky laws of the several states (including,
without limitation, the reasonable fees and disbursements of the Initial
Purchasers' counsel relating to such registration or qualification); (v) the
furnishing of such
18
copies of the Offering Memorandum, and all amendments and supplements thereto,
as may be reasonably requested for use in connection with the Exempt Resales;
(vi) the preparation of certificates for the Notes (including, without
limitation, printing and engraving thereof); (vii) the application for quotation
of the Notes in the PORTAL Market(SM) (including all disbursements and listing
fees); (viii) the approval of the Notes by DTC for "book-entry" transfer
(including fees and expenses of counsel); (ix) the rating of the Notes and the
Exchange Notes; (x) the obligations of the Trustee, any agent of the Trustee and
the counsel for the Trustee in connection with the Indenture, the Notes, the
Guarantees, the Exchange Notes and the Exchange Guarantees; (xi) the performance
by the Company and the Guarantors of their other obligations under this
Agreement; provided, however, that except as provided in this Section 6 and in
Sections 8 and 11 hereof, the Initial Purchasers shall pay their own costs and
expenses.
7. Conditions to Initial Purchasers' Obligations. The respective
obligations of the Initial Purchasers hereunder are subject to the accuracy,
when made and on and as of the Closing Date, of the representations and
warranties of the Company and the Guarantors contained herein, to the
performance by the Company and the Guarantors of their respective obligations
hereunder, and to each of the following additional terms and conditions:
(a) No Initial Purchaser shall not have discovered and disclosed to
the Company on or prior to the Closing Date that the Offering Memorandum or any
amendment or supplement thereto contains an untrue statement of a fact which, in
the opinion of counsel for the Initial Purchasers, is material or omits to state
a fact which, in the opinion of such counsel, is material and is required to be
stated therein or is necessary to make the statements therein not misleading.
(b) All corporate proceedings and other legal matters incident to
the authorization, form and validity of this Agreement, the Notes, the
Guarantees, the Exchange Notes, the Exchange Guarantees, the Registration Rights
Agreement, the Indenture and the Offering Memorandum, and all other legal
matters relating to this Agreement and the transactions contemplated hereby and
thereby shall be reasonably satisfactory in all material respects to counsel for
the Initial Purchasers, and the Company and the Guarantors shall have furnished
to such counsel all documents and information that they may reasonably request
to enable them to pass upon such matters.
(c) ▇▇▇▇ ▇▇▇▇▇ & ▇▇▇▇ PLC counsel for the Company shall have
furnished to the Initial Purchasers its written opinion, as counsel to the
Company and the Guarantors, addressed to the Initial Purchasers and dated the
Closing Date, in a form and substance satisfactory to the Initial Purchasers and
counsel for the Initial Purchasers and substantially in the form attached hereto
as Exhibit C-1.
(d) Miles & Stockbridge PC counsel for the Company shall have
furnished to the Representatives its written opinion, as counsel to the Company
and the Guarantors, addressed to the Initial Purchasers and dated the Closing
Date, in a form and substance satisfactory to the Initial Purchasers and counsel
for the Initial Purchasers and substantially in the form attached hereto as
Exhibit C-2.
19
(e) The Initial Purchasers shall have received from ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇
LLP, counsel for the Initial Purchasers, such opinion or opinions, dated such
Closing Date, with respect to the issuance and sale of the Notes, the Offering
Memorandum, Guarantees, the Indenture and other related matters as the Initial
Purchasers may reasonably require, and the Company shall have furnished to such
counsel such documents as they reasonably request for the purpose of enabling
them to pass upon such matters.
(f) At the time of execution of this Agreement, the Initial
Purchasers shall have received from Ernst & Young LLP a letter, in form and
substance satisfactory to the Initial Purchasers, addressed to the Initial
Purchasers and dated the date hereof (i) confirming that they are independent
registered public accountants within the meaning of the Securities Act and are
in compliance with the applicable requirements relating to the qualification of
accountants under Rule 2-01 of Regulation S-X of the Commission and (ii)
stating, as of the date hereof (or, with respect to matters involving changes or
developments since the respective dates as of which specified financial
information is given in the Offering Memorandum, as of a date not more than five
days prior to the date hereof), the conclusions and findings of such firm with
respect to the financial information and such other matters as are ordinarily
covered by accountants' "comfort letters" to underwriters in connection with
registered public offerings.
(g) With respect to the letter of Ernst & Young, LLP referred to in
the preceding paragraph and to the extent delivered to the Initial Purchasers
concurrently with the execution of this Agreement (the "initial letter"), the
Company shall have furnished to the Initial Purchaser a letter (the "bring-down
letter") of such accountants, addressed to the Initial Purchasers and dated the
Closing Date (i) confirming that they are independent registered public
accountants within the meaning of the Securities Act and are in compliance with
the applicable requirements relating to the qualification of accountants under
Rule 2-01 of Regulation S-X of the Commission, (ii) stating, as of the delivery
of the bring-down letter (or, with respect to matters involving changes or
developments since the respective dates as of which specified financial
information is given in the Offering Memorandum, as of a date not more than five
days prior to the date of the bring-down letter), the conclusions and findings
of such firm with respect to the financial information and other matters covered
by the initial letter and (iii) confirming in all material respects the
conclusions and findings set forth in the initial letter.
(h) Neither the Company, any Guarantor nor any of their respective
subsidiaries shall have sustained, since the date of the latest audited
financial statements included or incorporated by reference in the Offering
Memorandum, any material loss or interference with its business from fire,
explosion, flood or other calamity, whether or not covered by insurance, or from
any labor dispute or court or governmental action, order or decree, which loss
or interference could reasonably be expected to have a Material Adverse Effect
otherwise than as set forth or contemplated in the Offering Memorandum; and (ii)
since such date, there shall not have been any change in the capital stock or
long-term debt of the Company, any Guarantor or any of their respective
subsidiaries or any material adverse change, or any development involving a
prospective material adverse change, in or affecting the general affairs,
management, financial position, stockholders' equity or results of operations of
the Company and its subsidiaries, otherwise than as set forth or contemplated in
the Offering Memorandum.
20
(i) The Company and each Guarantor shall have furnished or caused to
be furnished to the Initial Purchasers on the Closing Date certificates of
officers of the Company and each Guarantor satisfactory to ▇▇▇▇▇▇ Brothers Inc.
as to the accuracy of the representations and warranties of the Company and each
Guarantor herein at and as of the Closing Date, as to the performance by the
Company and each Guarantor in all material respects of all of their obligations
hereunder to be performed at or prior to the Closing Date and as to such other
matters as ▇▇▇▇▇▇ Brothers Inc. may reasonably request.
(j) Subsequent to the execution and delivery of this Agreement (i)
no downgrading shall have occurred in the rating accorded the Company's debt
securities by any "nationally recognized statistical rating organization," as
that term is defined by the Commission for purposes of Rule 436(g)(2) of the
Rules and Regulations and (ii) no such organization shall have publicly
announced that it has under surveillance or review, with possible negative
implications, its rating of any of the Company's debt securities.
(k) The Notes shall have been designated for trading on the PORTAL
Market(SM).
(l) The Company and the Guarantors shall have executed and delivered
the Registration Rights Agreement, and the Initial Purchasers shall have
received an original copy thereof, duly executed by the Company and the
Guarantors.
(m) The Company, the Guarantors and the Trustee shall have executed
and delivered the Indenture, and the Initial Purchasers shall have received an
original copy thereof, duly executed by the Company, the Guarantors and the
Trustee.
(n) Subsequent to the execution and delivery of this Agreement there
shall not have occurred any of the following: (i) trading in securities
generally on the New York Stock Exchange or the American Stock Exchange or in
the over-the-counter market, or trading in any securities of the Company on any
exchange or in the over-the-counter market, shall have been suspended or minimum
prices shall have been established on any such exchange or such market by the
Commission, by such exchange or by any other regulatory body or governmental
authority having jurisdiction; (ii) a banking moratorium shall have been
declared by Federal or state authorities; (iii) the United States shall have
become engaged in hostilities, there shall have been an escalation is
hostilities involving the United States or there shall have been a declaration
of a national emergency or war by the United States; or (iv) there shall have
occurred such a material adverse change in general economic, political or
financial conditions (or the effect of international conditions on the financial
markets in the United States shall be such) as to make it, in the judgment of
▇▇▇▇▇▇ Brothers Inc., impracticable or inadvisable to proceed with offering or
delivery of the Notes being delivered on the Closing Date.
(o) On or prior to the Delivery Date, DTC shall have accepted the
Notes for clearance.
All opinions, letters, evidence and certificates mentioned above or
elsewhere in this Agreement shall be deemed to be in compliance with the
provisions hereof only if they are in form and substance reasonably satisfactory
to counsel for the Initial Purchasers.
21
8. Indemnification and Contribution.
(a) The Company and each Guarantor jointly and severally shall
indemnify and hold harmless each Initial Purchaser, its directors, officers and
employees and each person, if any, who controls any Initial Purchaser within the
meaning of the Securities Act, from and against any loss, claim, damage or
liability, joint or several, or any action in respect thereof (including, but
not limited to, any loss, claim, damage, liability or action relating to
purchases and sales of Notes), to which that Initial Purchaser, director,
officer, employee or controlling person may become subject, under the Securities
Act or otherwise, insofar as such loss, claim, damage, liability or action
arises out of, or in connection with, (i) any untrue statement or alleged untrue
statement of a material fact contained (A) in the Offering Memorandum or in any
amendment or supplement thereto or (B) in any Blue Sky application or other
document prepared or executed by the Company or any Guarantor (or based upon any
written information furnished by the Company or any Guarantor) specifically for
the purpose of qualifying any or all of the Notes under the securities laws of
any state or other jurisdiction (any such application, document or information
being hereinafter called a "Blue Sky Application"), or (ii) the omission or
alleged omission to state in the Offering Memorandum or the Offering Memorandum,
or in any amendment or supplement thereto, or in any Blue Sky Application, any
material fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading or (iii) any act or failure to act or any alleged act or failure to
act by any Initial Purchaser in connection with, or relating in any manner to,
the Notes or the offering contemplated hereby, and which is included as part of
or referred to in any loss, claim, damage, liability or action arising out of or
based upon matters covered by clause (i) or (ii) above (provided that the
Company, the Guarantors shall not be liable under this clause (iii) to the
extent that it is determined in a final judgment by a court of competent
jurisdiction that such loss, claim, damage, liability or action resulted
directly from any such acts or failures to act undertaken or omitted to be taken
by such Initial Purchaser through its bad faith, gross negligence or willful
misconduct), and shall reimburse each Initial Purchaser and each such director,
officer, employee or controlling person promptly upon demand for any legal or
other expenses reasonably incurred by that Initial Purchaser, director, officer,
employee or controlling person in connection with investigating or defending or
preparing to defend against any such loss, claim, damage, liability or action as
such expenses are incurred; provided, however, that the Company and the
Guarantors shall not be liable in any such case to the extent that any such
loss, claim, damage, liability or action arises out of, or is based upon, any
untrue statement or alleged untrue statement or omission or alleged omission
made in the Offering Memorandum, or in any such amendment or supplement, or in
any Blue Sky Application, in reliance upon and in conformity with written
information concerning such Initial Purchaser furnished to the Company through
the Initial Purchasers by or on behalf of any Initial Purchaser specifically for
inclusion therein and described in Section 8(c). The foregoing indemnity
agreement is in addition to any liability that the Company or the Guarantors may
otherwise have to any Initial Purchaser or to any director, officer, employee or
controlling person of that Initial Purchaser.
(b) Each Initial Purchaser, severally and not jointly, shall
indemnify and hold harmless the Company, each Guarantor, their respective
officers and employees, each of their respective directors, and each person, if
any, who controls the Company or any Guarantor within the meaning of the
Securities Act, in each case from and against any loss, claim, damage or
liability, joint or several, or any action in respect thereof, to which the
Company, any Guarantor
22
or any such director, officer or controlling person may become subject, under
the Securities Act or otherwise, insofar as such loss, claim, damage, liability
or action arises out of, or in connection with, (i) any untrue statement or
alleged untrue statement of a material fact contained (A) in the Offering
Memorandum or in any amendment or supplement thereto, (B) in any Blue Sky
Application or (ii) the omission or alleged omission to state in the Offering
Memorandum, or in any amendment or supplement thereto, or in any Blue Sky
Application any material fact required to be stated therein or necessary to make
the statements therein not misleading, but in each case only to the extent that
the untrue statement or alleged untrue statement or omission or alleged omission
was made in reliance upon and in conformity with written information concerning
such Initial Purchaser furnished to the Company through the Representatives by
or on behalf of that Initial Purchaser specifically for inclusion therein, and
shall reimburse the Company, any Guarantor and any such director, officer or
controlling person for any legal or other expenses reasonably incurred by the
Company, any Guarantor or any such director, officer or controlling person in
connection with investigating or defending or preparing to defend against any
such loss, claim, damage, liability or action as such expenses are incurred. The
foregoing indemnity agreement is in addition to any liability which any Initial
Purchaser may otherwise have to the Company, any Guarantor or any such director,
officer, employee or controlling person.
(c) Promptly after receipt by an indemnified party under this
Section 8 of notice of any claim or the commencement of any action, the
indemnified party shall, if a claim in respect thereof is to be made against the
indemnifying party under this Section 8, notify the indemnifying party in
writing of the claim or the commencement of that action; provided, however, that
the failure to notify the indemnifying party shall not relieve it from any
liability which it may have under this Section 8 except to the extent it has
been materially prejudiced by such failure and, provided, further, that the
failure to notify the indemnifying party shall not relieve it from any liability
which it may have to an indemnified party otherwise than under this Section 8.
If any such claim or action shall be brought against an indemnified party, and
it shall notify the indemnifying party thereof, the indemnifying party shall be
entitled to participate therein and, to the extent that it wishes, jointly with
any other similarly notified indemnifying party, to assume the defense thereof
with counsel reasonably satisfactory to the indemnified party. After notice from
the indemnifying party to the indemnified party of its election to assume the
defense of such claim or action, the indemnifying party shall not be liable to
the indemnified party under this Section 8 for any legal or other expenses
subsequently incurred by the indemnified party in connection with the defense
thereof other than reasonable costs of investigation; provided, however, that
the Initial Purchasers shall have the right to employ counsel to represent
jointly the Initial Purchasers and those other Initial Purchasers and their
respective directors, officers, employees and controlling persons who may be
subject to liability arising out of any claim in respect of which indemnity may
be sought by the Initial Purchasers against the Company or any Guarantor under
this Section 8 if, in the reasonable judgment of the Initial Purchasers, it is
advisable for the Initial Purchasers and those directors, officers, employees
and controlling persons to be jointly represented by separate counsel, and in
that event the fees and expenses of such separate counsel shall be paid by the
Company or any Guarantor. No indemnifying party shall (i) without the prior
written consent of the indemnified parties (which consent shall not be
unreasonably withheld), settle or compromise or consent to the entry of any
judgment with respect to any pending or threatened claim, action, suit or
proceeding in respect of which indemnification or contribution may be sought
hereunder
23
(whether or not the indemnified parties are actual or potential parties to such
claim or action) unless such settlement, compromise or consent includes an
unconditional release of each indemnified party from all liability arising out
of such claim, action, suit or proceeding, or (ii) be liable for any settlement
of any such action effected without its written consent (which consent shall not
be unreasonably withheld), but if settled with the consent of the indemnifying
party or if there be a final judgment of the plaintiff in any such action, the
indemnifying party agrees to indemnify and hold harmless any indemnified party
from and against any loss or liability by reason of such settlement or judgment
and does not include any statement as to or findings of fault, culpability or
failure to act by or on behalf of any indemnified person.
(d) If the indemnification provided for in this Section 8 shall for
any reason be unavailable to or insufficient to hold harmless an indemnified
party under Section 8(a), 8(b) or 8(c) in respect of any loss, claim, damage or
liability, or any action in respect thereof, referred to therein, then each
indemnifying party shall, in lieu of indemnifying such indemnified party,
contribute to the amount paid or payable by such indemnified party as a result
of such loss, claim, damage or liability, or action in respect thereof, (i) in
such proportion as shall be appropriate to reflect the relative benefits
received by the Company and the Guarantors on the one hand and the Initial
Purchasers on the other from the offering of the Notes or (ii) if the allocation
provided by clause (i) above is not permitted by applicable law, in such
proportion as is appropriate to reflect not only the relative benefits referred
to in clause (i) above but also the relative fault of the Company and the
Guarantors, on the one hand, and the Initial Purchasers on the other with
respect to the statements or omissions which resulted in such loss, claim,
damage or liability, or action in respect thereof, as well as any other relevant
equitable considerations. The relative benefits received by the Company and the
Guarantors, on the one hand, and the Initial Purchasers on the other with
respect to such offering shall be deemed to be in the same proportion as the
total net proceeds from the offering of the Notes purchased under this Agreement
(before deducting expenses) received by the Company and the Guarantors on the
one hand, and the purchase discounts in Section 3 hereof received by the Initial
Purchasers with respect to the Notes purchased under this Agreement, on the
other hand, bear to the total gross proceeds from the offering of the Notes
under this Agreement. The relative fault shall be determined by reference to
whether the untrue or alleged untrue statement of a material fact or omission or
alleged omission to state a material fact relates to information supplied by the
Company or the Guarantors on the other hand, or the Initial Purchasers on the
other hand, the intent of the parties and their relative knowledge, access to
information and opportunity to correct or prevent such statement or omission.
For purposes of the preceding two sentences, the net proceeds deemed to be
received by the Company shall be deemed to be also for the benefit of the
Guarantors and information supplied by the Company shall also be deemed to have
been supplied by the Guarantors. The Company, the Guarantors, and the Initial
Purchasers agree that it would not be just and equitable if contributions
pursuant to this Section 8 were to be determined by pro rata allocation (even if
the Initial Purchasers were treated as one entity for such purpose) or by any
other method of allocation which does not take into account the equitable
considerations referred to herein. The amount paid or payable by an indemnified
party as a result of the loss, claim, damage or liability, or action in respect
thereof, referred to above in this Section 8 shall be deemed to include, for
purposes of this Section 8(d), any legal or other expenses reasonably incurred
by such indemnified party in connection with investigating or defending any such
action or claim. Notwithstanding the provisions of this Section 8(d), no Initial
Purchaser shall be required to contribute any amount in excess of the amount by
which the
24
total price at which the Notes initially purchased by it and distributed to the
public was offered to the Eligible Purchasers exceeds the amount of any damages
which such Initial Purchaser has otherwise paid or become liable to pay by
reason of any untrue or alleged untrue statement or omission or alleged
omission. No person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Securities Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation. The Initial
Purchasers' obligations to contribute as provided in this Section 8(d) are
several in proportion to their respective underwriting obligations and not
joint.
(e) The Initial Purchasers severally confirm and the Company and the
Guarantors acknowledge that the statements with respect to the offering of the
Notes by the Initial Purchasers set forth in the last sentence on the cover
page, in the last paragraph on page (ii) and in the eighth, ninth and fourteenth
paragraphs in the section entitled "Plan of Distribution" in the Offering
Memorandum are correct and constitute the only information concerning such
Initial Purchasers furnished in writing to the Company or any Guarantor by or on
behalf of the Initial Purchasers specifically for inclusion in the Offering
Memorandum.
9. Defaulting Initial Purchasers. If, on the Closing Date, any Initial
Purchaser defaults in the performance of its obligations under this Agreement,
the remaining non-defaulting Initial Purchasers shall be obligated to purchase
the Notes which the defaulting Initial Purchaser agreed but failed to purchase
on the Closing Date in the respective proportions which the amount of Notes set
opposite the name of each remaining non-defaulting Initial Purchaser in Schedule
I hereto bears to the total number amount of Notes set opposite the names of all
the remaining non-defaulting Initial Purchasers in Schedule I hereto; provided,
however, that the remaining non-defaulting Initial Purchasers shall not be
obligated to purchase any of the Notes on the Closing Date if the total amount
of Notes which the defaulting Initial Purchaser or Initial Purchasers agreed but
failed to purchase on such date exceeds 9.09% of the total amount of Notes to be
purchased on the Closing Date, and any remaining non-defaulting Initial
Purchasers shall not be obligated to purchase more than 110% of the amount of
Notes which it agreed to purchase on the Closing Date pursuant to the terms of
Section 3. If the foregoing maximums are exceeded, the remaining non-defaulting
Initial Purchasers, or those other Initial Purchasers satisfactory to the
Representatives who so agree, shall have the right, but shall not be obligated,
to purchase, in such proportion as may be agreed upon among them, all the Notes
to be purchased on the Closing Date. If the remaining Initial Purchasers or
other Initial Purchasers satisfactory to the Representatives do not elect to
purchase the Notes which the defaulting Initial Purchaser or Initial Purchasers
agreed but failed to purchase on the Closing Date, this Agreement shall
terminate without liability on the part of any non-defaulting Initial Purchaser
or the Company or the Guarantors, except that the Company and the Guarantors
will continue to be liable for the payment of expenses to the extent set forth
in Section 6.
Nothing contained herein shall relieve a defaulting Initial
Purchaser of any liability it may have to the Company or any Guarantor for
damages caused by its default. If other Initial Purchasers are obligated or
agree to purchase the Notes of a defaulting or withdrawing Initial Purchaser,
the Company may postpone the Closing Date for up to seven full business days in
order to effect any changes that in the opinion of counsel for the Company or
counsel for the Initial Purchasers may be necessary in the Offering Memorandum
or in any other document or arrangement.
25
10. Termination. The obligations of the Initial Purchasers hereunder may
be terminated by the Initial Purchasers by notice given to and received by the
Company prior to delivery of and payment for the Notes if, prior to that time,
any of the events described in Sections 7(i), 7(j) or 7(n) shall have occurred
or if the Initial Purchasers shall decline to purchase the Notes for any reason
permitted under this Agreement.
11. Reimbursement of Initial Purchasers' Expenses. If (a) the Company
shall fail to tender the Notes for delivery to the Initial Purchasers by reason
of any failure, refusal or inability on the part of the Company or any Guarantor
to perform any agreement on their part to be performed, or because any other
condition of the obligations hereunder required to be fulfilled by the Company
or any Guarantor is not fulfilled, the Company and the Guarantors will reimburse
the Initial Purchasers for all reasonable out-of-pocket expenses (including
reasonable fees and disbursements of counsel) incurred by the Initial Purchasers
in connection with this Agreement and the proposed purchase of the Notes, and
upon demand the Company and the Guarantors shall pay the full amount thereof to
the Initial Purchasers. If this Agreement is terminated pursuant to Section 9 by
reason of the default of one or more Initial Purchasers, the Company and the
Guarantors shall not be obligated to reimburse any defaulting Initial Purchaser
on account of those expenses.
12. Notices, etc. All statements, requests, notices and agreements
hereunder shall be in writing, and:
(a) if to the Initial Purchasers, shall be delivered or sent by mail
or facsimile transmission to ▇▇▇▇▇▇ Brothers Inc., ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇,
▇.▇. ▇▇▇▇▇, Attention: Syndicate Department, (fax: (▇▇▇) ▇▇▇-▇▇▇▇), with a copy
to ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇, N.Y. 10022,
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, (fax (▇▇▇) ▇▇▇-▇▇▇▇) and with a copy, in the case of
any notice pursuant to Section 8(c), to the Director of Litigation, Office of
the General Counsel, ▇▇▇▇▇▇ Brothers Inc., ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
(fax (▇▇▇) ▇▇▇-▇▇▇▇);
(b) if to the Company or any Guarantor, shall be delivered or sent
by mail, telex or facsimile transmission to Corrections Corporation of America,
▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇▇ ▇.
▇▇▇▇▇, ▇▇. (Fax: (▇▇▇) ▇▇▇-▇▇▇▇); provided, however, that any notice to an
Initial Purchaser pursuant to Section 8(c) shall be delivered or sent by mail or
facsimile transmission to such Initial Purchaser at its address set forth in its
acceptance telex to ▇▇▇▇▇▇ Brothers Inc., which address will be supplied to any
other party hereto by ▇▇▇▇▇▇ Brothers Inc. upon request. Any such statements,
requests, notices or agreements shall take effect at the time of receipt
thereof. The Company shall be entitled to act and rely upon any request,
consent, notice or agreement given or made on behalf of the Initial Purchasers
by ▇▇▇▇▇▇ Brothers Inc. as if the notice or agreement was given by all of the
Initial Purchasers.
13. Persons Entitled to Benefit of Agreement. This Agreement shall inure
to the benefit of and be binding upon the Initial Purchasers, the Company, the
Guarantors and their respective successors. This Agreement and the terms and
provisions hereof are for the sole benefit of only those persons, except that
(A) the representations, warranties, indemnities and agreements of the Company
and the Guarantors contained in this Agreement shall also be
26
deemed to be for the benefit of the person or persons, if any, who control any
Initial Purchaser within the meaning of Section 15 of the Securities Act and (B)
the indemnity agreement of the Initial Purchasers contained in Section 8(b) of
this Agreement shall be deemed to be for the benefit of directors of the Company
and the Guarantors, officers of the Company and the Guarantors and any person
controlling the Company or the Guarantors within the meaning of Section 15 of
the Securities Act. Nothing in this Agreement is intended or shall be construed
to give any person, other than the persons referred to in this Section 13, any
legal or equitable right, remedy or claim under or in respect of this Agreement
or any provision contained herein.
14. Survival. The respective indemnities, representations, warranties and
agreements of the Company, the Guarantors and the Initial Purchasers contained
in this Agreement or made by or on behalf of them, respectively, pursuant to
this Agreement, shall survive the delivery of and payment for the Notes and
shall remain in full force and effect, regardless of any investigation made by
or on behalf of any of them or any person controlling any of them.
15. Definition of the Terms "Business Day" and "Subsidiary". For purposes
of this Agreement, (a) "business day" means any day on which the New York Stock
Exchange, Inc. is open for trading and (b) "subsidiary" has the meaning set
forth in Rule 405 of the Rules and Regulations.
16. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
17. Counterparts. This Agreement may be executed in one or more
counterparts and, if executed in more than one counterpart, the executed
counterparts shall each be deemed to be an original but all such counterparts
shall together constitute one and the same instrument.
18. Headings. The headings herein are inserted for convenience of
reference only and are not intended to be part of, or to affect the meaning or
interpretation of, this Agreement.
27
If the foregoing correctly sets forth the agreement among the
Company, the Guarantors, and the Initial Purchasers, please indicate your
acceptance in the space provided for that purpose below.
Very truly yours,
CORRECTIONS CORPORATION OF AMERICA
By /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Chief Executive Officer
CCA OF TENNESSEE, LLC
PRISON REALTY MANAGEMENT, INC.
TECHNICAL AND BUSINESS INSTITUTE OF
AMERICA, INC.
CCA INTERNATIONAL, INC.
CCA PROPERTIES OF AMERICA, LLC
CCA PROPERTIES OF ARIZONA, LLC
CCA PROPERTIES OF TENNESSEE, LLC
CCA WESTERN PROPERTIES, INC.
By /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Chief Executive Officer
CCA PROPERTIES OF TEXAS, L.P.
By /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Chief Executive Officer, CCA
Properties of America, LLC,
as General Partner
TRANSCOR AMERICA LLC
By /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Vice President, Treasurer
28
Execution Version
Accepted:
▇▇▇▇▇▇ BROTHERS INC.
▇.▇. ▇▇▇▇▇▇ SECURITIES INC.
BANC OF AMERICA SECURITIES LLC
WACHOVIA CAPITAL MARKETS, LLC
SG AMERICAS SECURITIES, LLC & INVESTMENT BANK
AVONDALE PARTNERS
BB&T CAPITAL MARKETS
FIRST ANALYSIS SECURITIES CORPORATION
▇▇▇▇▇▇▇▇▇ & COMPANY, INC.
▇▇▇▇▇▇ ▇▇▇▇▇▇ & CO. INC.
▇▇▇▇▇▇▇▇ CAPITAL PARTNERS
For themselves and as representatives for the several Initial Purchasers
named in Schedule I
By ▇▇▇▇▇▇ BROTHERS INC., as Authorized Representative
By: /s/ ▇▇▇▇▇▇▇ Sleigh
------------------------------------
Name: ▇▇▇▇▇▇▇ Sleigh
Title: Managing Director
By ▇.▇. ▇▇▇▇▇▇ SECURITIES INC., as Authorized Representative
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Managing Director
By BANC OF AMERICA SECURITIES, LLC, as Authorized Representative
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Principle
A-1