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EXHIBIT 10.77
INDEMNITY AGREEMENT
This INDEMNITY AGREEMENT (the "Agreement") is entered into on this 29th
day of September, 2000, by and between PRISON REALTY TRUST, INC., a Maryland
corporation (the "Company"), and PRISON MANAGEMENT SERVICES, INC., a Tennessee
corporation ("PMSI").
WITNESSETH:
WHEREAS, the Company, PMSI, Corrections Corporation of America, a
Tennessee corporation ("CCA"), and Juvenile and Jail Facility Management
Services, Inc., a Tennessee corporation ("JJFMSI"), on the one hand, and Prison
Acquisition Company L.L.C., a Delaware limited liability company ("Prison
Acquisition"), on the other hand, are parties to that certain Securities
Purchase Agreement, dated as of December 26, 1999, as amended February 28, 2000
(the "Securities Purchase Agreement");
WHEREAS, pursuant to Section 7.3 of the Securities Purchase Agreement,
each of the Company, PMSI, CCA, and JJFMSI are jointly and severally liable to
Prison Acquisition for, among other things, the payment of a Transaction Fee, as
defined in the Securities Purchase Agreement, in the amount of $15,700,000.00,
if and when such Transaction Fee is deemed due and payable under the terms
thereof;
WHEREAS, pursuant to Section 7.6 of the Securities Purchase Agreement,
each of the Company, PMSI, CCA, and JJFMSI are jointly and severally liable to
Prison Acquisition for, among other things, the payment of a Breakup Fee, as
defined in the Securities Purchase Agreement, in the amount of $7,500,000.00, if
and when such Breakup Fee is deemed due and payable under the terms thereof;
WHEREAS, pursuant to Section 10.1(d) of the Securities Purchase
Agreement, on April 16, 2000, the Company, PMSI, CCA, and JJFMSI terminated the
Securities Purchase Agreement and agreed to a series of alternative transactions
with Pacific Life Insurance Company (the "Termination");
WHEREAS, as the result of the Termination and the non-payment of the
fees described above, Prison Acquisition has initiated litigation in the United
Stated District Court for the Southern District of New York against the Company,
PMSI, CCA, and JJFMSI to compel payment of and recover such fees, such
litigation being styled Prison Acquisition Company L.L.C. vs. Prison Realty
Trust, Inc., Corrections Corporation of America, Prison Management Services,
Inc., and Juvenile and Jail Facility Management Services, Inc., civil action no.
00 Civ. 4269 (LAP)(the "Litigation"); and
WHEREAS, the Company and PMSI desire to enter into certain agreements
regarding the satisfaction of any liabilities resulting from the Litigation as
set forth herein.
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NOW, THEREFORE, for and in consideration of the foregoing and other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto hereby agree as follows:
1. Indemnification. The Company hereby agrees to indemnify, defend and
save PMSI and its respective officers, directors, employees, agents, or other
affiliates (each, an "Indemnified Party"), forever harmless from and against,
and to promptly pay to an Indemnified Party or reimburse an Indemnified Party
for, any and all liabilities (whether contingent, fixed or unfixed, liquidated
or unliquidated, or otherwise), assessments, losses, costs, expenses, interest,
fines, penalties, actual or punitive damages or costs or expenses (including
reasonable fees and expenses of attorneys, accountants and other experts)
(individually and collectively, the "Losses") sustained or incurred by any
Indemnified Party relating to, resulting from, arising out of or otherwise by
virtue of the Litigation.
2. Consideration. In consideration for the Company's indemnification of
the Indemnified Parties set forth in Section 1. herein, PMSI agrees to pay to
the Company an aggregate cash payment equal to $6,000,000.00, such payment being
immediately due and payable upon the request of the Company.
3. Authorization. Each party to this Agreement hereby represents and
warrants that the execution, delivery, and performance of this Agreement are
within the powers of each party and have been duly authorized by the party, the
execution and performance of this Agreement by each party have been duly
authorized by all applicable laws and regulations, and this Agreement
constitutes the valid and enforceable obligation of each party in accordance
with its terms.
4. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be an original, and all of which shall
together constitute one agreement.
5. Headings. Section headings are for convenience or reference only and
shall not be used to construe the meaning of any provision in this Agreement.
6. Governing Law. This Agreement shall be construed in accordance with
the laws of the State of Tennessee.
7. Severability. Should any part of this Agreement be invalid or
unenforceable, such invalidity or unenforceability shall not affect the validity
and enforceability of the remaining portion.
8. Successors. This Agreement shall be binding upon and inure to the
benefit of the respective parties and their permitted assigns and successors in
interest.
9. Waivers. No waiver of any breach of any of the terms or conditions
of this Agreement shall be held to be a waiver of any other or subsequent
breach; nor shall any waiver be
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valid or binding unless the same shall be in writing and signed by the party
alleged to have granted the waiver.
10. Entire Agreement. This Agreement constitutes the entire agreement
of the parties hereto and supersedes all prior agreements and presentations with
respect to the subject matter hereof.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.
PRISON REALTY TRUST, INC.
By: /s/ John D. Ferguson
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Its: President
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PRISON MANAGEMENT SERVICES, INC.
By: /s/ Darrell K. Massengale
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Its: President
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