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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): July 18, 1997
Corrections Corporation of America
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(Exact name of registrant as specified in its charter)
Tennessee 1-13560 62-1156308
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(State or other jurisdiction (Commission File Number) (I.R.S. Employer
of incorporation) Identification No.)
102 Woodmont Boulevard
Nashville, Tennessee 37205
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (615) 292-3100
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Item 2. Disposition of Assets.
On July 18, 1997, Corrections Corporation of America, a Tennessee
corporation (the "Company") and certain of its subsidiaries, sold the following
nine correctional and detention facilities to CCA Prison Realty Trust, a
Maryland real estate investment trust (the "REIT"), for an aggregate purchase
price of $308.1 million:
Houston Processing Center located in Houston, Texas;
Laredo Processing Center located in Laredo, Texas;
Bridgeport Pre-Parole Transfer Facility, located in Bridgeport, Texas;
Mineral Wells Pre-Parole Transfer Facility, located in Mineral Wells,
Texas;
West Tennessee Detention Facility, located in Mason, Tennessee;
Leavenworth Detention Center, located in Leavenworth, Kansas;
Eloy Detention Center, located in Eloy, Arizona; Central Arizona
Detention Center, located in Florence, Arizona; and
T. Don Hutto Correctional Center, located in Taylor, Texas.
Additionally, on July 28, 1997, the REIT exercised its option to purchase the
Northeast Ohio Correctional Center, located in Youngstown, Ohio. The Company
sold the Northeast Ohio Correctional Center to the REIT for a purchase price of
$70.1 million. The Company sold the real property and all tangible personal
property associated with each of the facilities to the REIT.
The purchase price of all of the facilities except for the T. Don Hutto
Correctional Center and the Northeast Ohio Correctional Center was based on an
evaluation of the current and anticipated cash flows and operating results of
the facilities. Because the T. Don Hutto Correctional Center and the Northeast
Ohio Correctional Center were completed in January and June of 1997,
respectively, the purchase prices were calculated as the Company's approximate
cost of developing, constructing and equipping the facility, plus 5% of such
costs.
Simultaneously with the sale of each of the facilities to the REIT, the
Company entered into agreements with the REIT to lease the facilities from the
REIT pursuant to long-term, non-cancelable triple net leases which require the
Company to pay all operating expenses, taxes, insurance and other costs. All of
the leases provide for base rent with certain annual escalations and have
primary terms ranging from 10-12 years which may be extended at the fair market
rates for three additional five-year periods upon the mutual agreement of the
Company and the REIT.
Doctor R. Crants is the chairman of the Board of Directors and Chief
Executive Officer of the Company and the Chairman of the Board of Trustees of
the REIT. D. Robert Crants, III, President and a member of the Board of Trustees
of the REIT, is the son of Doctor R. Crants. Doctor R. Crants and D. Robert
Crants, III, as well as certain other trustees or officers of the REIT or
directors or officers of the Company, may also own, directly or indirectly,
shares in both companies.
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Item 7. Financial Statements, Pro Forma Financial Information and
Exhibits
a. Not applicable.
b. Financial Statements. Pursuant to Rule 12b-23 of the
Securities Exchange Act of 1934, as amended, the Company
hereby incorporates by reference the pro-forma financial
statements included on pages 39-46 and F5-F9 of its Prospectus
filed with the Commission pursuant to Rule 424(b)(1) of the
Securities Act of 1933, as amended, via EDGAR on July 15,
1997, Registration No. 333-25727-01.
c. Exhibits
1. Pursuant to Rule 12b-32 of the Securities Exchange
Act of 1934, as amended, the Company hereby
incorporates by reference the following exhibits to
its Registration Statement on Form S-11 and S-3 as
filed with the Commission, Registration No.
333-25727-01:
(a) Exhibit 2 - Agreement of Sale and Purchase
Between the REIT and the Company;
(b) Exhibit 10.1(a) - Option Agreement Between
the REIT and the Company with respect to
the Northeast Ohio Correctional Center;
(c) Exhibit 10.2 - Form of Master Agreement to
Lease Between the REIT and the Company; and
(d) Exhibit 10.3 - Form of Lease Between the
REIT and the Company with respect to the
Leased Properties.
2. Lease Agreement Between the REIT and the Company
with respect to the Northeast Ohio Correctional
Center.
3. News Release dated July 18, 1997 regarding the sale
of nine correctional and detention facilities by the
Company to the REIT.
4. News Release dated July 29, 1997 regarding the sale
of Northeast Ohio Correctional Center by the Company
to the REIT.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned, thereto duly authorized.
CORRECTIONS CORPORATION OF AMERICA
By: /s/Darrell K. Massengale
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Name: Darrell K. Massengale
Title: Chief Financial Officer, Vice
President, Finance;
Secretary/Treasurer
Date: August 1, 1997
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
CORRECTIONS CORPORATION OF AMERICA
EXHIBITS
TO CURRENT REPORT ON
FORM 8-K DATED JULY 18, 1997
Commission File Number 1-13560
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Exhibit Index
Exhibit No. Description Page No.
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Exhibits 10.1 - 10.4 are incorporated by reference to the Company's Registration Statement on
Forms S-11 and S-3 as filed with the Commission, Registration No. 333-25727-01.
10.1 Exhibit 2 - Agreement of Sale and Purchase Between the
REIT and the Company; --
10.2 Exhibit 10.1(a) - Option Agreement Between the REIT
and the Company with respec to the Northeast Ohio
Correctional Center; --
10.3 Exhibit 10.2 - Form of Master Agreement to Lease
Between the REIT and the Company; --
10.4 Exhibit 10.3 - Form of Lease Between the REIT and the
Company with respect to the Leased Properties; --
10.5 Lease Agreement Between the REIT and the Company
with respect to the Northeast Ohio Correctional Center. E-1
99.1 News Release dated July 18, 1997 regarding the sale of
nine correctional and detention facilities by the Company to
the REIT E-10
99.2 News Release dated July 29, 1997 regarding the sale of
Northeast Ohio Correctional Center by the Company to
the REIT E-12