Exhibit 10.41

AG. Contract                     D.C. Contract
No: KR 96-2426           No: DC-PO-PRIV-96/97-6790


                                STATE OF ARIZONA
                            DEPARTMENT OF CORRECTIONS
                               1601 West Jefferson
                             Phoenix, Arizona 85007

                                    AGREEMENT
                    PROVISION, OPERATION AND MANAGEMENT OF A
                              PRIVATE SECURE PRISON

         This   Agreement  is  entered  into   between   Correctional   Services
Corporation,  hereinafter  referred  to as CSC and the  Director  of the Arizona
Department of Corrections, hereinafter known as the Department.

    This document,  including the General Provisions, Scope of Services, Special
Provisions,  attachments,  including  any  amendments  or  modifications,  shall
constitute  the entire  Agreement  between the parties and  supersedes all other
understandings, oral or written.

IN WITNESS  WHEREOF,  the  parties  hereto  agree to carry out the terms of this
Agreement.



CORRECTIONAL SERVICES CORPORATION     ARIZONA DEPT. OF
CORRECTIONS

Signature of Authorize Individual   Date
James F. Slattery
Typed Name
President, Chief Executive Officer
Typed Title
1819 Main, Suite 1000
Sarasota, Florida 34236
Address



Signature






<PAGE>





Typed Name



Typed Title





                       Additional Signatures as Applicable


Date

Charles L. Ryan
Typed Name

Charles L. Ryan
Typed Name
Deputy Director, Prison Operations
Typed Title





Approved as to form this 7th day of November, 1996.

                                   GRANT WOODS
                              The Attorney General



By:
Assistant Attorney General



<PAGE>










FIFE SYMINGTON
GOVERNOR



                        Arizona Department of Corrections



                               1601 WEST JEFFERSON
                             PHOENIX, ARIZONA 85007
                                 (602) 542-5536



December 18, 1996

James F. Slattery, President
Correctional Services Corporation
1819 Main Street, Suite 1000
Sarasota, Florida 34236



RE:      Contract Document DC-PO-PRIV-96/97-6790


Dear Mr. Slattery:

Enclosed for your  signature are two copies of the referenced  contract  between
the Department of Corrections and Correctional Services Corporation.

In the  interest of avoiding  any delay in  processing  this  contract,  you are
requested  to  make no  changes  in the  enclosed  documents.  Any  unauthorized
alterations to the enclosed will necessitate  reprocessing  through the Attorney
General's  office for a second review and approval.  The attendant  delay can be
avoided by discussing any concerns or questions with me at 542-3245.

Contract  award is made at the time the contract is fully executed and, as such,
the Department  shall not be liable for any expense incurred in conjunction with
this contract prior to your  notification by a representative  of the Department
that services have been authorized.

Once the signed document has been returned and the Hollenbach sealed survey with
the table of equivalent bearing is received, per attached letter to Russell Rau,
the contract shall be forwarded internally for final Department signatures.





<PAGE>



For your information, the required insurance documentation received from CSC has
been approved per the attached  letter from the  Department of  Administration's
Risk Management office.



A Notice to  Proceed  shall be  issued  once the  Department  has  received  and
reviewed  the  construction  documents  identified  in Article  III and V of the
Agreement.

Please sign both  copies of the  transmitted  documents  and return them to this
office at the following address:



                            Department of Corrections
                        Contracts Administration, M/C 802
                         1645 West Jefferson, 4th Floor
                             Phoenix, Arizona 85007



<PAGE>









Page 2
Mr. Slattery
December 18, 1996



When the contract  has been fully  executed,  a copy will be forwarded  for your
files.

If you should have questions or concerns please direct  communications  to me or
Steve Spangler at (602) 542-3245.



Sincerely,



Maureen Rogers, Assistant Contract Administrator



cc:      Carl Nink, Assistant Director, Prison Operations, Support
         Services Division John Kohl, Manager, Privatization
         Contracts, Support Services Division Russell Rau, Senior
         Vice President, Correctional Services Corporation
         Contract File
         Chrono File




<PAGE>









FIFE SYMINGTON
  GOVERNOR


                        Arizona Department of Corrections
                               1601 WEST JEFFERSON
                             PHOENIX, ARIZONA 85007
                                 (602) 542-5536


December 18, 1996


Russell S. Rau, Senior Vice President
Correctional Services Corporation
6601 Sands Point, Suite 54
Houston, Texas 77074



Re:      Request for Sealed Proposals (RFP) No. 6702
         Agreement #DC-PO-PRIV-96/97-6790


    Dear Mr. Rau:

Anthony Zelenak,  Lead Project Director in the Departments  Facility  Activation
Bureau,  has examined the two surveys of the 18 acre land parcel and has advised
that the following information needs to be provided.

The Hollenbach Survey Company,  Inc., sealed survey #96-03649 (A) dated December
1996, and the accompanying  legal  description  also sealed,  have been reviewed
against the unsealed  Arrinaton  Watkins  Architects (AWA) survey.  The area and
location  described  by both are  identical.  The major  difference  is that the
Hollenbach survey is based on the G7SRM and was not adjusted or rotated to match
the Pinal County  Coordinate  System  (north side of property to match the north
line of the southeast quarter of section 36). CSC needs to direct the Hollenbach
Survey Company to add a table of equivalent bearings to the survey for each side
of the property  comparing the bearings  shown on the survey with the equivalent
rotated bearing to match the Pinal County Coordinate System. This survey must be
sealed  and an  explanation  describing  the  need for the  table of  equivalent
bearing needs to be evident on the survey.

This  will  provide  clarity  with the deed when it is  compared  to the AWA DNA
Survey  which will become part of the  "Contract  Documents"  for the project as
such documents are defined in the




<PAGE>



Fourteenth  Edition of the AIA Document A201 - General  Conditions for contracts
for construction.

Please  ensure the  Hollenbach  sealed survey to include the table of equivalent
bearings is forwarded to my  attention  by no later than  Tuesday,  December 24,
1996.

In  addition,  please  note  that in  accordance  with  terms of the  referenced
contract,  CSC must  provide the  Department  with the  following  documentation
before the  Department  will issue the Notice to Proceed  once the  contract  is
executed:



<PAGE>









Page 2
Letter - Russell S. Rau
December 18,-1996



Contract  documents  for the  construction  project  between  Arrington  Watkins
Architects,  Dominion  Leasing,  Inc.,  and CSC. . Such  contract  documents are
defined in the Fourteenth  Edition of the AIA Document A201 - General Conditions
for contracts for
construction.

Should you have any questions or concerns, please direct communications to Steve
Spangler or me at (602) 542-3245.



Sincerely,





Maureen J. Rogers
Assistant Contracts Administrator



         cc:      Mike Smarik, Assistant -Director, Administrative
         Services VIA Judith Kilgus,  Administrator, Bureau of
         Business & Finance
         Mary Laverdure, Contracts Administrator -
         Carl Nink, Assistant Director, Support Services, Prison
         Operations
         John Kohl, Manager, Privatization Contracts, Support
         Services
         Contract File
         Chrono File



James Slattery, President, Chief Executive Officer
Correctional Services Corporation
1819 Main, Suite 1000
Sarasota, Florida 34236

                      ARIZONA DEPARTMENT OF ADMINISTRATION
                             RISK MANAGEMENT SECTION




<PAGE>






MEMORANDUM

DATE:            November 1, 1996

TO:              Mary Laverdure, Contracts Administrator Department
                 of Corrections

FROM:            Kurt Wilian, Insurance Analyst

SUBJECT:         RFP 6702 Correctional Services Corp.




Mary, this is to confirm our  conversation  today.  We have received  acceptable
documentation  and evidence of insurance  coverage from the above contractor and
can confirm they comply with the RFP Attachment #7 at this time.

As we proceed we will want to monitor two areas:

1) They must provide Risk Management  with acceptable  certificates of insurance
for  Professional  Liability  coverage for those  positions which they intend to
out- source, and are excluded from the CSC program,  specifically,  surgeons and
lawyers;

2) They must comply with your guidelines to submit public financial  information
on an interim  basis,  with  compliance  of the  contract  subject to an ongoing
approval of their financial condition.

Mary, I appreciate your patience and support of Risk
Management through this process



<PAGE>


                                TABLE OF CONTENTS


ARTICLE 1.   Definitions ................................................ l-5

ARTICLE II.  Term of the Agreement

             A. Requirements for the Agreement to be Effective........... 5
             B. Term .....................................................5
             C. Renewal Term Option...................................... 6

ARTICLE III. Governing Law/Policies and Procedures

             A.   Compliance with Law, Department Policies/Procedures,
                  RFP 6702, etc. ........................................ 6
             B.   Department's Option to Purchase........................ 7
             C.   Construction Parameters................................ 7
             D.   Submittal and Approval of CSC's Procedures............. 10
             E.   Responsibilities of Department Staff................... 11

             F.   Classification/Disciplinary Actions
                  Guidelines for CSC's Staff............................. 11

ARTICLE IV.  Recruitment/Hiring/Staff Training

             A. Recruitment/Hiring ...................................... 11
             B. Staff Training........................................... 19

ARTICLE V.   Provision, Operation & Management of the Secure Facility

             A. Construction/Renovation and Operation ................... 24
             B. Inmate Management Services............................... 28

ARTICLE VI.  Payment Obligations & Procedures/Financial Reports

             A. Requirements Governing All Cost Increases................ 39
             B. Per Diem................................................. 39
             C. Invoices and Records..................................... 39
             D. Inmate Wages/Disbursements/A.R.S. 31-255................. 40
             E. Requirements of A.R.S. 31-201.01......................... 42
             F. Costs To Be Paid by CSC.................................. 43
             G. Costs To Be Paid by the Department....................... 45
             H. A.R.S. 41-1609.01 D...................................... 46
             I. A.R.S. 41-1609.01 E...................................... 46
             J. Financial Reports........................................ 46

ARTICLE VII. Department Monitoring/Performance Evaluation

             A. Monitoring............................................... 46
             B. Performance Evaluation................................... 48

ARTICLE VIII. Performance Bond/Insurance/Indemnification

             A. Performance Bond......................................... 48
             B. Plan of Insurance........................................ 49




<PAGE>



             C. Indemnification.......................................... 51



<PAGE>








Table of Contents Continued  ...



ARTICLE IX. Notices & Amendments

            A.       Notices............................................. 53
            B.       Amendments..........................................

                     1. Process.......................................... 54
                     2. Annual Cost Adjustments.........................  55
                     3. Other Cost Adjustments/Modifications............. 56
   
ARTICLE X.  Default
      
            A. Default of CSC............................................ 56
            B. Remedies of the Department................................ 58
            C. Default of the Department................................. 60
            D. Remedies of CSC........................................... 60

ARTICLE XI.  Force Majeure

            A. Explanation............................................... 60
            B. Remedies.................................................. 60
            C. Exceptions................................................ 61

ARTICLE XII. Termination

            A. Department Funding........................................ 61
            B. Annual Performance Bond-CSC............................... 62


GENERAL PROVISIONS

ATTACHMENTS:

1      CSC Staffing, Pattern

2       Position Description Form

3       Subcontractors

4       Pre-Service Security Training

5       Pre-Service Non-Security Training, - Required and
        Optional Courses

6       Inmate Time Sheet - Payment detail that accompanies
        the CSC deposit to the Alcohol Abuse Treatment Fund

7       Monthly Per Diem Invoice Forms Monthly Report for
        Inmate Health Care Services

8       Insurance Requirements




<PAGE>




 9      Definitions - Types of written instructions required
        by the Department, i.e. Department Orders, Technical
        Manuals, Institutional Orders and Post Orders.  Cross
        Reference Index

10      Per Diem and Sliding Scale

11      Suspension or Debarment Status or Certification

12      Fee Schedule and Budget Narrative Forms

13      Legal Description for Secure Prison Site

14      Negotiation Parameters for Purchase of Secure Prison



<PAGE>









D.C. Contract                  SCOPE OF SERVICES
No: 6790                                                               Page 1

Procurement Authority:  Authority to Contract          Authority to Contract
A.R.S. 41-2534          D. C: A. R. S. Contractor:     Expiration Date:  Three
                        41-1604 et. seq.               years from date of
                                                       receipt of first inmate.


                                   WITINESSETH



     WHEREAS, Arizona Remised Statutes 41-1609 and 41-1609.01, as amended by the
forty-first  Legislature of the State of Arizona,  First Regular Session,  1993,
authorized the  Department to enter into  contracts with private  enterprise for
the operation and management of secure prison beds, and



     WHEREAS,  the Department  issued  Request for Sealed  Proposal (RFP) Number
6702 for the construction, operation, management and maintenance of a secure 600
bed prison for the  housing and  treatment  of 200 adult male  releases  who are
awaiting due process hearings for allegedly violating  conditions of release and
400 adult male inmates  committed to the Department  under A.R.S.  28- 692.01 or
28-697 who have demonstrated a need for substance or alcohol abuse intervention,
and



     WHEREAS,  CSC (formerly  known as Esmor  Correctional  Services,  Inc.) did
respond  to the  solicitation  and  was  subsequently  determined  to  have  the
expertise, experience and resources to provide such services, and



     WHEREAS,   public   hearings  were  conducted  in  accordance  with  A.R.S.
41-1609.02 C. and the Town of Florence did  subsequently  authorize the selected
site to be used as a Level II, secure prison,



     NOW, THEREFORE, the Department and CSC do hereby agree as set forth herein.


                                    ARTICLE I




<PAGE>



                                   DEFINITIONS



For the purposes of this Agreement,  the following  definitions as well as those
definitions  provided  in the General  Provisions  which do not  conflict  shall
apply:

ACA - The American Correctional Association

ACA STANDARDS - The standards for Adult  Correctional  Institutions as published
by ACA  (third  edition,  Part  Two,  Physical  Plant,  January  1990) as may be
subsequently supplemented.

ADAAG - Americans with Disabilities Act Accessibility Guidelines provided by the
Americans with  Disabilities  Act and the Arizona's with  Disabilities  Act. The
guidelines are applicable to the
construction of the secure prison and any subsequent  renovation,  modifications
or additions made to the secure prison during the term of the Agreement.

Contract No: 6790
Continuation Sheet



ADDITIONAL  SERVICES  - Those  operation  or  management  services  that  may be
required to be furnished by CSC pursuant to Court  Orders/Decrees  or Department
written  instructions  that are in addition to those in effect as of the date of
execution of this  Agreement  and cause an increase in the cost of operating and
managing, the secure prison.

ALCOHOL ABUSE  TREATMENT FUND (AATF) - A fund  authorized by A.R.S.  31-255,  as
amended,  into  which the  Department  deposits  67 % of wages  received  by DUI
inmates for work performed under inmate public work contracts. The remaining 33%
of wages earned is deposited in the inmate's individual trust account.

ARIZONA POST - Arizona Peace Officers  Standards and Training.  The council that
approves the  correctional  officer  training  curriculum,  establishes  minimum
standards for  correctional  officers and issues  certificates  of completion to
persons successfully complying with established standards and training.

A.R.S. - Arizona Revised Statutes.

ARIZONA  STATE  PRISON-FLORENCE  WEST  (ASP-FW)  -  The  official  name  of  the
privatized prison to be constructed,  owned, operated, maintained and managed by
CSC for the Department under the




<PAGE>



authority of this Agreement and referred to herein as the Secure
Prison.

CAPITAL  EQUIPMENT  - Item(s)  acquired  by CSC with monies from the Welfare and
Benefits  Fund with a unit cost of $5,000 or more and a useful  life of at least
one year. Unit cost includes  applicable  sales tax, freight and other ancillary
costs to place the asset in its intended location.

CONTRACTS  ADMINISTRATION  OFFICE - Office within the  Department of Corrections
charged  with  the  responsibility  of  managing  and  maintaining  professional
services  contracts  and, as such,  serves as the  official  repository  for all
professional  service  contracts entered into between the Department and private
entities.

COTA - Correctional Officer Training(y Academy of the Department.

COURT  ORDERS  -  Any  orders  or  judgments  issued  by a  court  of  competent
jurisdiction  and  any  stipulations,   agreements  or  plans  entered  into  in
connection with  litigation that are applicable to the operation,  management or
maintenance  of  Department  or  privatized  prisons  and  to the  treatment  or
custodial care of inmates.

CSC POST ORDERS - Orders related to CSC's  procedures that have been prepared by
CSC and approved by the Department. Post Orders provide direction to CSC's staff
regarding responsibilities assigned to specific posts in the secure prison.

CSC  PRISON  WARDEN - Title of CSC  employee  charged  with  managing  the daily
operations of the secure prison.

CSC INSTITUTIONAL  ORDERS - Those procedures prepared by CSC and approved by the
Department  that are based on Department  Written  Instructions.  The procedures
provide  broad  direction  to  CSC's  staff  in the  operation,  management  and
maintenance of the secure prison.

CSC PROPOSAL - Proposal dated November 15, 1995, submitted by CSC in response-to
the Department's Request for Sealed Proposals (RFP) Number 6702. The proposal is
inclusive of updated proposal  information,  to include  additional  information
dated February 15, 1995 and April 1, 1996, CSC's best and final offer dated July
17, 1996,  additional  clarifying  information and Staffing Patterns provided on
August 5, 1996, CSC's second best and final offer date stamped November 7, 1996,
and clarifying information dated November 22, 1996.

DEPARTMENT - Arizona Department of Corrections.




<PAGE>




DEPARTMENT  MONITOR - Department  employee who serves as the liaison between the
Department  and CSC  regarding  matters  that  arise  as a result  of the  daily
monitoring of the services authorized by this Agreement.

DEPARTMENT  WRITTEN   INSTRUCTIONS  -  Department   regulations  and  management
directives  issued  by  executive  staff  of the  Department  which  govern  the
administration  and operation of the  Department  as a whole and the  individual
institutions  consistent with statutes,  rules and sound correctional practices.
Unless otherwise specified, Department Orders or Manuals when used herein, shall
mean all forms of  written  instructions  as  identified  in  Attachment  #9 and
applicable to the specific situation.  Refer to Attachment #9 for definitions of
all types of written  instructions  used by the Department to include a table of
contents and cross reference index.

DEPUTY DIRECTOR. PRISON OPERATIONS (Deputy Director) Department employee charged
with  managing this  Agreement  and  providing  direction to CSC relative to the
Agreement.

  DIRECTOR - The Director of the Arizona Department of Corrections

  DPS - Arizona Department of Public Safety.  The State agency
  responsible for licensing Security Agencies and Security Guards
  (Officers).

DUI INMATE - An inmate committed to the Department under A.R.S.
28-692.01 or A.R.S. 28-697 for drivin- while under the influence
of intoxicating liquor or drugs.

EVENT OF DEFAULT - Events or  circumstances  relative  to the  failure of either
party  hereto  to  perform  a legal  or  contractual  duty as set  forth in this
Agreement.

GENERAL  PROVISIONS  -  Those  standard  contract  provisions  required  by  the
Department and made a part of this Agreement.

INMATE - Any adult male  committed to the Department who qualifies in accordance
with  Department  screening  criteria for  assignment to the  privatized  secure
prison operated under the authority of this Agreement.

INMATE DAY - Each  calendar  day,  or part  thereof,  during  which an inmate is
assigned to the secure prison. The Department shall pay for the day an inmate is
received at the secure  prison,  but not for the day an inmate is released  from
the secure prison.





<PAGE>



INMATE  SCREENING  CRITERIA - Department  requirements  for the assignment of an
inmate to the secure prison.

INMATE WAGES - Compensation that can be earned by inmates in
accordance with A.R.S. 31-254 and the Department's Work Incentive
Pay Plan (WIPP).

INMATE  WELFARE AND  BENEFIT  FUND - Fund  established  and managed by CSC which
shall  be used to the  benefit  of  assigned  inmates  to pay for  equipment  or
services  in  accordance  with the  Department's  policy  regarding  the  Inmate
Activities  and  Recreation  Fund.  Monies for the fund shall be generated  from
profits  resulting from the sale of commissary  inventory  items and the revenue
received by CSC from the Department vendor for the inmate telephone system.

INMATE  WORK  AGREEMENTS  -  Multi-party  agreements  entered  into  between the
Department,  CSC and other  parties for the  provision  of inmate labor for work
activities with public or private entities as authorized by the Department.

IN-SERVICE  TRAINING - Training required by the Department to be provided by CSC
on an annual basis to meet the recurring training needs of staff.

INVENTORIAL  EQUIPMENT  - Any item  acquired  by CSC with monies from the Inmate
Welfare and Benefits  fund with a unit cost of $1,000.00 and a useful life of at
least one year.

JLBC - Joint Legislative Budget Committee of the State of
Arizona.

NON-APPROPRIATION  - The  failure  by the  Arizona  Legislature,  as part of its
budgetary process, to appropriate money requested by the Department for payments
due under this Agreement.

OPERATION  AND  MANAGEMENT  SERVICES -  Consulting,  operation,  management  and
maintenance  services  necessary to provide for the care,  custody,  control and
treatment of inmates in accordance with Department written  instructions and the
terms and conditions of this Agreement.

PHYSICAL  FORCE - That  degree  of force  that is  directed  toward  the body of
another person that is not likely to result in death.

PRE-SERVICE  NON-SECURITY  TRAINING - Orientation training to be provided to all
nonsecurity   staff,   including   volunteers,    subcontractors,    independent
contractors,   as  well  as  the  employees,   agents  or   representatives   of
subcontractors or




<PAGE>



independent contractors, who will work for or provide services to
CSC at the secure prison.

PRE-SERVICE  SECURITY  TRAINING  -  Training  specified  by  the  Department  as
equivalent to that provided by the Department for security officers and required
to be provided by CSC to all staff designated by CSC as security officers.  Such
training  shall  consist of 215 academy  hours  followed by at least 40 hours of
on-the-job  (OJT) training under direct  supervision of an experienced  security
officer.

PROPERTY - All buildings, eighteen (18) acres of land, as described herein,
and all fixtures, fixtures,  equipment and chattel located at the secure prison
90 days in advance of CSC's  receipt  of the  Department's  notice of its
intent to  exercise  its purchase option.

PUBLIC  WORKS  ACTIVITIES  -  Activities  performed  by inmates for other public
entities relevant to the maintenance,  construction or adaptation of public land
or any building,  structure,  erection or  improvement  on public land including
roads, flood control projects and parks.

RETURN TO  CUSTODY  (RTC)  INMATE - A  convicted  male  felon  committed  to the
Department and awaiting due process hearing for allegedly  violating  conditions
of release.

RFP 6702 - Solicitation to include amendments and
modifications,  issued by the Department of Corrections for the privatization of
200 Return to Custody and 400 DUI secure  prison beds to be used for the housing
and treatment of inmates  committed to the Department and assigned to the secure
prison.

SECURE PRISON - Level 2 privatized  prison to be constructed,  owned,  operated,
maintained  and managed by CSC for the  Department  under the  authority of this
Agreement and officially named the Arizona State Prison-Florence West (ASP-FW).

SECURITY  AGENCY - An agency to whom a license  has been  granted by the Arizona
Department of Public Safety in accordance with A.R.S.
Title 32, Chapter 26, Article 2.

SECURITY  OFFICER - An employee of CSC to whom a "registration  certificate" has
been issued by the Arizona Department of Public Safety in accordance with A.R.S.
Title 32, Chapter 26, Article 3.





<PAGE>



SERVICE SPECIFICATIONS - The Service  Specifications  entitled "Secure Return to
Custody Prison" and "Secure DUI Prison, " included with RFP 6702 which set forth
the minimum  requirements of the Department for delivery of services relative to
RTC and DUI inmates.

SPECIAL  PURPOSE RECORDS - Department  records that are transferred  through the
correctional  system  with the  inmate  and  provided  to CSC for those  inmates
assigned to the secure prison.  Special Purpose Records  include,  at least, the
field file as well as medical and visitation records.

SPECIAL  SERVICES  FUND  (Activities  and  Recreation  Fund  [A  &  R  Fund])  -
Nonappropriated  funds  generated  from such sources as sales from inmate stores
(canteen/commissary),  contraband funds, vending machines sales and commissions,
donations, etc., that are to be used for the benefit of the inmates.

                                   ARTICLE II
                              TERM OF THE AGREEMENT

2.1      This Agreement shall be fully executed when all signatures
         are affixed.

2.2      The  Agreement  shall  terminate  three  (3)  years  from  the date CSC
         receives the first  Department  inmate,  unless  terminated  earlier as
         permitted  by the General  Provisions  or the terms set forth herein or
         renewed, as indicated below.

2.3      At the Department's option, this -Agreement may be renewed
         in accordance with A.R.S. 41-1609.01 J.,, K. and L.

2.3.1      Twelve (12) months after receipt of the first inmate,  the Department
           shall  initiate a comparative  analysis of the secure prison to Level
           II units within the Department.

2.3.2      At least an analysis of those  analytical  factors  listed in Article
           VII of this  Agreement  shall be presented to -the  Director and JLBC
           relative to the performance of CSC during the previous period.

2.3.3      If it is  determined  by the  Director  that the  option to renew the
           Agreement  shall  be  exercised,   negotiations  for  cost  or  price
           adjustments  may be conducted by the Department  with CSC relative to
           the provision of contracted  services  superior in quality to service
           provided by the State at essentially the same cost as the State.





<PAGE>



               2.3.3.1 If cost or price adjustments are recommended as a result
               of negotiations, such recommendations shall be made in
               accordance with A.R.S. 41-1609.01.

2.3.4      If the  Agreement  is to be  renewed,  a  formal  Amendment  shall be
           prepared  and  executed in  accordance  with  Article IX prior to the
           expiration  date of the  Agreement.  The amendment  shall reflect any
           negotiated change in services and the amended expiration date as well
           as authorized price or cost adjustments, if any.

2.3.4.1        If the Agreement is not renewed,  the Department shall remove all
               inmates from secure prison no later than the date of termination.



                                   ARTICLE III
                      GOVERNING LAW/POLICIES AND PROCEDURES

3.1      This  Agreement  shall be  construed  in  accordance  with Arizona law,
         including  the  Arizona  Procurement  Code along with its  implementing
         rules and the Arizona  Administrative Code (A.A.C.) Title 2, Chapter 7.
         Each  provision  of law and  any  terms  required  by law to be in this
         Agreement are a part of this Agreement as if fully stated herein.

3.2      CSC, a licensed security agency in accordance with A.R.S.
         Title 32, Chapter 26, Article 2, Sections 32-2611 through
         32-2615 shall remain licensed for the term of this
         Agreement, including the ten-n of renewal, if exercised.
         The requirements of A.R.S. Title 32, Chapter 26, Article 2,
         Section 32-2613 C.2. shall not limit in any way the
         requirements of this Agreement.

3.3      CSC shall construct the secure prison on 18 acres of land
         within a 39.73 acre parcel of land owned by CSC and located
         in Pinal County, within the city limits of Florence,
         Arizona.  The 18 acre secure prison site shall be located on
         the 18 most westerly acres within the 39.73 acre parcel as
         described in the legal description provided as Attachment
         #13 of this Agreement.  The legal boundaries of the entire
         39.73 acres are described in the certified ALTA survey
         completed preliminary to the CSC purchase of the land
         parcel.  The survey is on file with the Department and is
         hereby made a part of this Agreement by reference.

3.4      The  Department  shall  have  the  option,  during  the  term  of  this
         Agreement, to purchase the secure prison, the 18 acre site on which the
         secure prison is located and all capital




<PAGE>



         equipment utilized in the daily operation of said prison. If the option
         is exercised,  the Purchase  Agreement provided as Attachment #14 shall
         be  executed  and  shall  occur  within  a time  frame  to  ensure  the
         transaction is complete prior to the expiration of this Agreement.  The
         purchase price shall be negotiated in accordance  with the formulas set
         forth in Attachment #14.

3.4.1      The  Purchase  Agreement  may be  altered  and  amended  prior to its
           execution with the mutual  agreement of the parties (CSC, DOA and the
           Department), provided that any such alteration or amendment shall not
           materially  adversely  affect  the  rights  of the  parties  to  this
           Agreement.

3.4.2      CSC shall  ensure  that  Property  located at and used to operate the
           secure  prison at the time the first inmate is assigned to the secure
           prison,  shall  remain  available  to the  Department  at the time of
           purchase.  The equipment  shall be maintained in good working  order,
           outside of normal wear and tear,  and shall be replaced as  necessary
           in accordance with CSC's replacement schedule.

3.4.3      The secure prison shall be  constructed  within the cost lines of the
           per  them  as  shown  on the  Fee  Schedule  submitted  by  CSC  with
           correspondence dated October 25, 1996.

           3.4.4 CSC shall,  during the  construction  phase of this  Agreement,
           provide  to the  Deputy  Director,  or  designee  copies of  complete
           construction  documentation  to  include  at least the  below  listed
           items.  As-built  drawings and  warranties  applicable  to the secure
           prison shall be delivered to the Deputy  Director  within thirty (30)
           days  after  CSC  receives  the  Department's  notice  of  intent  to
           purchase.


         Architectural Drawings Structural Drawings and Calculations  Electrical
         Drawings  Plumbing  Drawings  HVAC  Drawings  Mechanical   Calculations
         Domestic  Water System  Documentation  Security  Systems  Drawings Fire
         Protection  System  Drawings  On-site  Utilities  Civil Plans  Complete
         Specifications All Addenda




<PAGE>



         All Architect's Supplemental Instructions
         All Change Orders
         All Requests for Information
         A Complete Copy of all Operation and Maintenance Manuals

        3.5 The  secure  prison  to  include  any  subsequent  modifications  or
        additions  to the  secure  prison,  shall  accommodate  at  least  those
        functional  areas listed in Objective II of the Service  Specifications,
        provided as Attachment #1 of RFP 6702.  The secure prison and associated
        support  systems  shall be  constructed  in accordance  with  Department
        requirements, applicable laws, rules, standards, codes, etc., to include
        at least the following:

3.5.1   Department requirements:

3.5.1.1        Air Conditioning-  (other than evaporative cooling) and carpeting
               shall not be used for inmate living space.

3.5.1.2     Those items listed in Article V, Paragraph 5. 1.

3.5.2    Applicable laws, rules, standards, codes, etc.:

3.5.2.1        ACA Standards as defined herein.

 3.5.2.2           Contract documents as defined in Paragraph 5.1.1 sealed
               by a licensed registrant.

                  The site plan and construction design shall be as discussed on
November 5, 1996. Contract Documents, inclusive of the items listed in Paragraph
3.4.4 and an updated Table of Construction Costs - 600 Bed/Private Prison, shall
be reviewed by the Department prior to issuance of the Notice
to Proceed.

3.5.2.3        Applicable Federal, State and local building, health,
               safety and fire codes.

3.5.2.4        All requirements and guidelines as provided by the Americans
               with Disabilities Act and the Arizona's with Disabilities Act
               as prescribed by the current version of Americans with
               Disabilities Act Accessibility Guidelines (ADAAG) and any
               subsequent versions issued before construction of the facility
               is completed or, subsequent to completion, at the time
               renovations, modifications or additions are made to the secure
               prison.  Initially, no inmates will be assigned to the secure
               prison until the prison is determined to be in compliance with
               all ADAAG relating to inmate accessibility to programs and
               services or to public accessibility.  This determination will
               be made by independent inspection of the completed facility,-
               as arranged by the Department.





<PAGE>



3.5.2.5 Requirements of Federal and State regulatory agencies.

         3.5.3             Failure to corn . ply with any of the above
         requirements shall require remediation. and/or correction by
         CSC at no cost to the State or the Department.

3.6      If, during the term of this Agreement (to include term of renewal), the
         secure  prison  is sold by CSC,  it  shall be  understood  that the new
         owner(s)  shall  be  obligated  by the  terms  and  conditions  of this
         Agreement  to  include   current   schedules,   i.e.,   Fee   Schedule,
         amortization schedule and depreciation schedule.

3.7     CSC shall  operate the secure  prison in  compliance  with all  Federal,
        State and local laws,  rules,  regulations  and codes  relative to fire,
        health  and  safety  issues  and  shall  be  responsible  for all  taxes
        applicable to their use of the said facility.

3.7.1      CSC shall, during the term of this Agreement,  ensure that the secure
           prison  provides full  accessibility  to all programs and services by
           inmates as well as full public accessibility as specified by ADAAG.

3.7.2      CSC shall timely pay and discharge, without offset, deduction or
           abatement for any cause, all duties, taxes, charges,
           assessments, impositions and payments, extraordinary as well as
           ordinary, unforeseen as well as foreseen, of every kind and
           nature (under or by virtue of any current or subsequently
           enacted law, ordinance, regulation, action or order of any
           public or governmental authority), which during the term of this
           Agreement are due, imposed upon, charged against, measured by or
           become a lien on the secure prison or any improvements or
           personal property therein.

        3.8 This Agreement,  which incorporates by reference the requirements of
        RFP 6702,  applicable Department written instructions and CSC's proposal
        as each is defined herein,  shall govern CSC's  performance  relative to
        the  construction,  operation,  management and maintenance of the secure
        prison as well as govern the care, custody, treatment and supervision of
        inmates  assigned  to  the  secure  prison.  The  Department's   written
        instructions   shall   prevail   over  the  Scope  of  Services   unless
        specifically  addressed  within the Scope of  Services in which case the
        Scope of Services shall prevail. The Agreement's Scope of Services shall
        prevail  over  the  Special   Provisions,   General  Provisions  or  any
        attachments  hereto and the requirements of the RFP. The requirements of
        R-FP 6702 shall prevail over CSC's proposal.





<PAGE>



           3.8.1 It shall be  understood  that  throughout  this  Agreement,  as
           reference  is  made  to  numbers  of  specific   Department   written
           instructions,  e.g., Director's  Instructions,  Department Orders, or
           Technical   Manuals,   CSC  shall   comply   with  the   Department's
           requirements  relative to the  subject  matter,  notwithstanding  the
           reference  to a specific  type of  written  instruction  or  document
           number.

           3.8.2           Unless otherwise specified herein, at least sixty
           (60) days prior to receipt of the first Department inmates

                  3.8.2.1  CSC shall  submit  for  Department  approval  written
                  institutional  orders, post orders and manuals as specified in
                  RFP  applicable   Department  written   instructions  and  the
                  Service, Specification.

          3.8.2.2            Commissioning, procedures for prison
                             activation

          3.8.2.3            Preventative maintenance schedules to be used
                             for all capital equipment.

          3.8.2.4            Capitalization policy.

         3.9 During- the term of this Agreement,  when changes occur to existing
         Department  written  instructions,  Administrative  Rules,  courses  or
         curriculum  that are  determined to be relevant to the operation of the
         secure prison, the Department shall, via the Department Monitor, notify
         CSC in writing.

3.9.1    After the Department's  initial approval of CSC required  institutional
         orders and post orders,  subsequent Department requested changes to CSC
         documents  shall be made  within  the  time  frames  stipulated  in the
         Department issued document.

3.9.2      Requests  initiated  by CSC to  change  institutional  orders or post
           orders previously approved by the Department shall be directed to the
           Department  Monitor by CSC for approval or disapproval  action by the
           Deputy  Director,  or designee.  Each request shall be accompanied by
           written information that details the reason for the desired change(s)
           and a  description  of the  impact on the  current  operation  if the
           change(s) is or is not authorized.

         3.10 When NEW Department written  instructions or Administrative  Rules
         are  issued,  or if NEW Court  Orders/Decrees  are issued by a Court of
         jurisdiction  that have a bearing  on this  Agreement,  the  Department
         shall provide CSC with a copy of the executed document.





<PAGE>



                  3.10.1 CSC shall prepare new institution orders or post orders
           for approval by the  Department's  Deputy Director,  or designee,  in
           order to ensure  implementation  within the time frames stipulated in
           the Department issued document.

                  3.10.2   Payment for costs relative to additional
           services required of CSC as a result of Department written
           instructions, Court Orders/Decrees or Administrative rules
           implemented after execution of this Agreement shall only be
           authorized if approved in accordance with the requirements
           of A.R. S. 41-1609.01 and Article IX of this Agreement.

3.11              The following responsibilities shall be administered by
      Department staff only:

         3.11.1            Calculating inmate release and parole eligibility
               dates.

         3.11.2            Calculating and awarding sentence credits.

         3.11.3            Approving inmate furloughs and work releases.

         3.11.4            Granting, denying or revoking inmate sentence
             credits.

         3.11.5            Invoking. any disciplinary action.

         3.11.6            Placing, an inmate under less restrictive custody
             or more restrictive custody.

         3.11.7            Accessing criminal background information
             developed from the Arizona Criminal Justice Information
             System (ACJIS).

         3.11.8            Processing, Inmate grievances

3.12     Actions  and  activities  provided  by CSC  staff  in  accordance  with
         Department written instructions regarding Inmate Classification,  shall
         require final signatory authorization from appropriate Department staff
         prior  to  implementation.   CSC  shall  submit   recommendations   for
         classification  actions to the  Department  Monitor for  acquisition of
         approval.

         3.13 Actions and  activities  provided by CSC staff in accordance  with
         inmate  disciplinary rules for the Department shall be submitted to the
         Department's  Discipline  Coordinator.  The  Department  shall  conduct
         disciplinary  hearings  and impose  sanctions  in  accordance  with the
         Inmate
         Rules of Discipline.





<PAGE>


                                   ARTICLE IV
                        RECRUITMENT/HIRING/STAFF TRAINING



Recruitment/Hiring

4.1      CSC  shall  comply  and shall  ensure  that  authorized  subcontractors
         comply,  during the term of this Agreement,  with all federal and state
         laws,   regulations,   rules,   executive  orders,   etc.  relative  to
         recruitment and hiring practices.

4.1.1      All  advertisements  for employment  issued by CSC and its authorized
           subcontractors   shall  state  that  unless  there  is  a  bona  fide
           occupational  qualification,  all qualified  applicants  will receive
           consideration for employment without regard to race, color, religion,
           sex,  national  origin,  age  (except as  provided  by law),  marital
           status, political affiliation or disability status.

4.1.2      CSC shall conduct employee  recruitment and hiring activities for all
           positions,   inclusive  of  security   staff,   in  accordance   with
           information provided in Section 8 of CSC's Proposal.

4.1.2.1        Prior to CSC's  selection of the final candidate for the position
               of Warden, CSC shall permit the Deputy Director,  or designee, to
               review and provide comment regarding information pertinent to the
               qualifications  of the  individual  recommended  by,  CSC for the
               position.

4.1.3          The Position Descriptions contained in Exhibit 8 C of
               CSC's proposal provide descriptions of essential work'
               tasks, responsibilities, skills, knowledge -and
               abilities as well as minimum qualifications for each
               type of position indicated on Attachment #1, Staffing
               Pattern.  Only those applicants who possess the required
               minimum qualifications, licenses, certifications,
               diplomas or degrees specified on the Position
               Descriptions and who also pass the required background
               investigation shall be hired by CSC or authorized
               subcontractors.

                  4.1.3.1           Security  officers  hired by CSC shall be at
                                    least 21 years of age and  shall  not have a
                                    record of any felony convictions.

               4.1.3.2              Personnel hired by CSC for the positions
                                    listed below shall be registered by DPS as a
                                    security guard (officer) in accordance with




<PAGE>



                                    the requirements of A.R.S. Title 32, Chapter
                                    26,   Article  3  prior  to   initiation  of
                                    service. Additionally, prior to assuming job
                                    responsibilities, CSC shall ensure that each
                                    security  officer  has  received  a passing,
                                    score   on   all   required   physical   and
                                    psychological   examinations   as   well  as
                                    attended and successfully completed required
                                    pre-service  security officer  training,  to
                                    include    non-lethal    weapons   training,
                                    physical  fitness  training  and 40 hours of
                                    OJT.

                                    CSC's designated security officer positions:

                                    Chief of Security
                                    Shift Supervisor
                                    Housing Unit Officer
                                    Intake/Release Officer
                                    Recreation Officer
                                    Central Control Center Officer
                                    Public Works Supervision Officer
                                    Visitation Officer
                                    Transportation Officer

                  4.1.3.3         If applicable, CSC staff employed at other
                                  secure facilities operated by CSC may submit
                                  applications to be transfer-red to the secure
                                  prison authorized herein provided that such
                                  staff are qualified as indicated in this
                                  Article.  An applicant for transfer to a
                                  security position must have at least one year
                                  current experience equal to a Correctional
                                  Officer, or experience that includes
                                  custodial responsibilities for incarcerated
                                  inmates and pass all requirements listed
                                  below to be considered for employment as a
                                  security officer authorized by this
                                  Agreement.

               A medical examination at the twenty-five
percent (25 %) level. (Employee must achieve
the fifty percent (50%) level at the
completion of training

               A psychological examination.

               Demonstrated proficiency in self-defense as
well as physical fitness at the fifty percent
(50%) level.





<PAGE>



               A competency exam based on the COTA curriculum.

               A background investigation.

                  4.1.3.4      All I health care professionals, to include
                               technicians, clinical I psychologists as well as
                               other mental health professionals, must be
                               licensed or certified in accordance with Arizona
                               Revised Statutes.  The Department Monitor shall
                               obtain written approval from the Department's
                               Deputy Director, Health Services, or designee,
                               regarding acceptable qualifications of each
                               provider before initiation of services under this
                               Agreement.

                               CSC  shall  submit  through  the  Department
                               Monitor, a current curriculum vitae for each
                               proposed  physician and a current resume for
                               all other proposed health care professionals
                               along with  verification  of Arizona license
                               or certification.

                  4.1.3.5      Instructors   of  adult   inmate   education
                               courses  as defined  by  Department  written
                               instructions    shall   be    certified   as
                               instructors  by the  Arizona  Department  of
                               Education   (DOE)  prior  to  initiation  of
                               services.

                  4.1.3.6      Qualifications of CSC personnel who serve as
                               chaplains must be approved by the
                               Department's Administrator of Pastoral
                               Activities whether such personnel are
                               employees, volunteers, subcontractors or
                               independent contractors.  Department approval
                               of qualifications must be obtained prior to
                               initiation of services.

                                    CSC  shall  submit  through  the  Department
                                    Monitor,  a current resume from the proposed
                                    service provider.  The resume shall at least
                                    indicate    that   the    provider    is   a
                                    representative of the professed faith system
                                    who is either  ordained  or a lay person who
                                    meets the  approval of leaders in that faith
                                    system.  The  proposed  provider  must  have
                                    experience in leading worship  services,  as
                                    well as experience in teaching ceremonial or
                                    meditation  services and counseling services
                                    of a non-medical Inmate.





<PAGE>



                  4.1.4  If  CSC  or  an  authorized  subcontractor  desires  to
                  establish a  position(s)  in addition to those  identified  on
                  Attachment #1, a Position  Description form provided with this
                  Agreement as Attachment #2 shall be completed and submitted to
                  the Department Monitor along with a letter stating- the reason
                  for the  proposed  position(s).  Completed  Fee  Schedule  and
                  Budget Narrative forms (Attachment #12) must be included which
                  clearly identify:  (i) expense  categories  impacted by adding
                  the position(s), and (ii) the proposed per them rates.

                  4.1.4.1        The Department Monitor shall forward requests
                                 from CSC for additional position(s) to the
                                 Deputy Director, or designee, for
                                 approval/disapproval.

                  4.1.4.2        Approved   changes  shall  not  be  implemented
                                 unless authorized in accordance with Article IX
                                 of this Agreement.

4.1.5      If CSC or an authorized subcontractor desires to reallocate
           a position(s) identified on Attachment #1 and the proposed
           reallocation shall result in a decrease in per them rates
           shown on Attachment #10, CSC shall submit to the Department
           Contract Monitor a description of the proposed action(s), a
           revised Attachment #1 to reflect the reallocation,
           completed Budget Narrative forms identifying expense
           categories impacted by the reallocation of the position(s),
           and a revised Fee Schedule reflecting the reduced per them
           rates as a result of the proposed reallocation(s).

4.1.5.1        The  Department   Contract  Monitor  shall  forward   information
               received  from  CSC to the  Deputy  Director,  or  designee,  for
               approval/disapproval.

4.1.5.2        If approved,  the revised  Attachment  #1 Staffing  Pattern and a
               revised  Attachment  #10  reflecting-  the reduced per them rates
               will  replace the  existing  Attachments  #1 and #10.  The former
               Attachments  shall  be  kept on file  to  indicate  the  previous
               agreement. A formal written Amendment shall not be required.

4.1.6.If   CSC or an authorized  subcontractor  desires to reallocate  positions
           identified  on  Attachment  #1 which do not result in a  decrease  or
           increase in the per them rates  shown on  Attachment  #10,  CSC shall
           submit a request for such  proposed  reallocation  to the  Department
           Monitor.  Such requests shall be accompanied by information that: (i)
           thoroughly  describes  the reason and purpose for such  changes,  and
           (ii) that the proposed chances will not




<PAGE>



           negatively  impact the  mission of the secure  prison as set forth in
           this  Agreement,   and  (iii)  that  the  changes  shall  permit  all
           Department requirements to be met. A revised Attachment #1 indicating
           the  reallocation  of  the  position(s)  shall  be  attached  to  the
           information submitted by CSC.

4.1.6.1        The  Department  Monitor  shall  forward all such requests to the
               Deputy Director, or designee for approval/ disapproval.

               4.1.6.2 If  requested  changes  are  approved,  the  Department's
               Contracts  Administration  Office shall  incorporate  the revised
               Attachment #1 Staffing Pattern,  into this Agreement by replacing
               the  existence,  Attachment.  The former  Attachment  #1 shall be
               maintained on file to reflect the previous agreement. The revised
               Attachment  #1 shall be  effective on the date of approval by the
               Deputy  Director.   A  formal  written  amendment  shall  not  be
               required.

4.1.7      CSC shall conduct recruitment and hiring activities to ensure,  staff
           vacancies, including subcontractor staff vacancies, are filled within
           thirty (30) days after the date the vacancy occurs.  CSC shall ensure
           that  authorized  subcontractors  have plans to actively  recruit and
           fill vacant positions within the specified time frame.

4.1.7.1           Positions required to be registered as security
                  officers as well as positions that provide food
                  services and health services are deemed critical
                  positions and shall be filled at all times.  All posts
                  classified , as critical posts shall be staffed at all times
                  consistent with the Department approved schedule.

                  4.1.7.2        If unforeseen or unavoidable circumstances
                                 prevent hiring of positions within thirty
                                 (30) days after the vacancy occurs, CSC shall
                                 provide documentation to the Contract Monitor
                                 which reflect due diligence on the part of
                                 CSC or the subcontractor to fill the vacant
                                 position(s) from time of vacancy until the
                                 position(s) is filled.

                  4.1.7.3        Failure  by CSC to  hire  positions  or fill
                                 post vacancies as described above may result
                                 in an Event(s) of Default being- declared in
                                 accordance with Article X.

4.2      Those positions  listed on Attachment #1 of this Agreement  reflect the
         staffing-  pattern  for all  positions  funded  by per them to  include
         security,   non-security,   food  service,  substance  abuse  treatment
         services, medical, dental, mental




<PAGE>



         health   services  as  well  as   positions   to  be  provided  by  the
         subcontractor(s)  authorized by this Agreement.  Prior to CSC's receipt
         of the first  Department  inmate,  staff hired for the listed positions
         shall have attended and  successfully  completed  pre-service  training
         required by this  Agreement  as  applicable  to each type of  position,
         e.g., security/non-security.

4.2.1      Staffing patterns for providers of medical (to include
           optometric), dental and mental health services shall be
           continent upon patient waiting times to be seen by the
           respective health professional.  Medical, to include
           optometric, dental and mental health providers shall be
           available for scheduled appointments a minimum of two days
           per week and shall be on-call and available within 30
           minutes of the secure prison, 24 hours per day, 7 days per
           week for coverage in emergency situations.  If waiting
           times are determined by the Department to be excessive, CSC
           shall increase the availability of the providers to ensure
           that waiting times are at acceptable levels, as approved by
           the Department's Deputy Director, Health Services, or
           designee.  Any costs associated with increased availability
           of health providers shall be borne by CSC.

4.2.2      CSC shall  ensure that mental  health  services/evaluations  shall be
           provided  a  minimum  of two  days per  week by a  licensed  clinical
           psychologist.  A licensed psychiatrist shall be provided as needed or
           required.

4.3      Services and benefits  similar to those identified in CSC's proposal in
         Section 8 under Personnel  Policies and Procedures,  shall be available
         to CSC's employees during the term of this Agreement.

4.4      CSC shall ensure that ACIC/NCIC background  investigations as well as ,
         reference  checks  are  conducted  and  completed  prior to hiring  any
         employee,  subcontractor,  independent contractor or volunteer assigned
         to the secure prison.

4.4.1     CSC shall be  responsible  for all costs  related  to  licensure  as a
          security agency and  registration  of staff as security  officers (see
          paragraph  4.1.4.2) in in accordance with the  requirements of A.R.S.,
          Title 32, Chapter 26,  Articles 2, 3 and 4, Sections  32-2611  through
          32-2637.

4.4.2      The Department shall conduct ACIC/NCIC background  investigations for
           CSC's security and non-security  positions at a cost to CSC of $4 per
           investigation.





<PAGE>



           4.4.3 The  Department  shall  supply  fingerprint  cards for CSC non-
           security positions at no cost to CSC.

4.4.4      CSC shall be responsible for the cost of fingerprinting non- security
           staff, to include potential  employees,  volunteers,  subcontractors,
           independent   contractors   and   the   employees   and   agents   of
           subcontractors  and  independent  contractors  who  will  work at the
           secure prison.

4.4.5      The  Department  shall  process  fingerprint  cards for non- security
           positions at a cost to CSC of $8 per card.

4.4.6      Total cost to CSC for the Department to conduct ACIC/NCIC  background
           investigations and process fingerprint cards for CSC's staff shall be
           $12 per individual.

4.4.6.1        The  Department  shall  send  CSC  an  invoice  documenting  each
               background  investigation  charge at the end of each  month.  CSC
               shall render payment in accordance with Article VI.

4.4.7      The processing of information for non-security positions
           shall be coordinated by the Department Monitor.

4.4.7.1        The  Department  Monitor  shall  provide  CSC  with  approval  or
               disapproval for each name submitted,  based on ACIC/NCIC results.
               If  subsequent  criminal  information  is obtained as a result of
               research relative to the fingerprint card, the Department Monitor
               shall advise CSC that the individual is  disqualified  and cannot
               be employed at the secure prison.

4.4.8      CSC shall ensure that security and non-security  positions to include
           subcontractor  positions  complete the forms listed below.  CSC shall
           provide  the  completed  forms  and  information  to  the  Department
           Monitor.  Originals of Form #30400005 and #70501097 shall be provided
           to CSC by the  Department.  CSC shall be responsible  for duplicating
           the forms as necessary.

4.4.8.1    Completed fingerprint card, Form FD-258

4.4.8.2        Department Background Investigation Supplement 33, Form
               #30400005

4.4.8.3   Consent to Search Form #70501097

         4.5     CSC staff shall attend Periodic Department meetings
         to include but not limited to the following:

Meeting                      Frequency              Required Attendance




<PAGE>




Administrators               Quarterly              Warden
Corporate Prison Admin        Monthly               Warden
Business Managers            Quarterly              Business Manager
Security Managers             Monthly               Chief of Security
Records Managers             Quarterly              Records Supervisor
Food Service Managers        Quarterly              Food Service Manager

4.6     From time of execution of this Agreement until one year after
        receipt of the first inmate, CSC shall not be permitted to
        subcontract any service not authorized by Attachment #3.
        Subsequent to the prescribed period, if CSC proposes to use a
        subcontractor in addition to or other than the subcontractor
        shown on Attachment #3, CSC shall follow the steps prescribed
        below.  The aforementioned time restriction does not preclude
        CSC from taking necessary corrective action, to include
        terminating the existing subcontract agreement, if the
        subcontractor fails to perform adequately.  CSC remains
        responsible for the provision of all services required by
        this Agreement.

4.6.1      Prior to submittal of information to the Deputy Director, or designee
           CSC shall  ensure that the proposed  subcontractor  has the staff and
           resources  within  its own  capabilities  to  provide  the  specified
           services, further subcontracting shall not be permitted.

               4.6.1.1 Each proposed subcontractor,  must be able to provide, if
               requested,  appropriately executed documents to reflect the legal
               formation  of their  business  structure  and must remain in good
               standing with  respective  entities where business  documents are
               filed. If the  subcontractor is incorporated,  good standing with
               the   Arizona   Corporation   Commission   must  be   maintained.
               Out-of-state  firms  who are  incorporated  must  file  necessary
               documents  with the  Arizona  Corporation  Commission  to conduct
               business in Arizona and ensure a statutory agent is identified in
               said documents.

               4.6.1.2 Each proposed subcontractor must be in good standing with
               any  state,  federal  or  local  agency  that  has a  contracting
               relationship with the  subcontractor.  If, during the previous 12
               months,  any  contractor  has  terminated or otherwise  ended the
               contracting relationship in a manner other than expiration of the
               contract,   the   subcontractor   may  not  be  approved  by  the
               Department.

4.6.2      CSC shall submit all required documentation as indicated
           below at least 90 calendar days prior to the projected




<PAGE>



           initiation of services in order to acquire Department approval of the
           proposed  subcontracting  entity as well as the proposed  subcontract
           agreement.  Services  shall not be initiated  unless  approved by the
           Department.  Each request to use a subcontractor shall be accompanied
           by the following:

4.6.2.1        A statement signed by authorized signatories of CSC and
               the 'proposed subcontractors reflecting that the
               subcontractor(s) has read RFP 6702, as well as applicable
               Department written instructions, the CSC proposal, as
               defined herein and this Agreement, as each document
               pertains to the service to be subcontracted.  The
               statement shall indicate that the subcontractor arrears
               to comply with all requirements to include all security
               requirements relative to access to the secure prison and
               completion of employment and criminal history checks for
               each employee, agent or representative of the
               subcontractor who will require such access.

               4.6.2.2  Documentation  to  reflect  the  qualifications  of  the
               proposed  subcontracting-  entity to include the  business  name,
               business  address,  telephone  number,  type  of  service  to  be
               provided  and  the  name of a  contact  person  for the  proposed
               subcontractor.  Additional  information  shall include i) written
               personnel procedures addressing that personnel information listed
               on page 37 of RFP 6702, ii) a signed statement acknowledging good
               standing with any Federal,  State or local agency as indicated in
               Paragraph  4.6.1.2  above  and,  iii)  the  name  of  contracting
               entities who have received services from subcontractor within the
               last five years;  types of services  provided for each identified
               contracting entity; number of clients served for each contracting
               entity,  name of contact  person with each  contractor  who would
               have first hand knowledge regarding the operation of the services
               provided by the proposed subcontractor.

               4.6.2.3 The proposed  subcontractor must complete Attachment #1 1
               Suspension or Debarment Status  Certification  provided with this
               Agreement.  If the  proposed  subcontractor  has  been  debarred,
               suspended or otherwise  lawfully  precluded from participating in
               any public procurement activity, the subcontractor shall disclose
               that  information.  Failure to  provide  such  information  or to
               complete  Attachment #1 I shall result in lack of approval of the
               subcontractor by the Department.





<PAGE>



               4.6.2.4   Certificates  of  insurance   (ACORD  Form)  reflecting
               insurance   coverages  as  required  by  Attachment  #8  of  this
               Agreement as well as certified  copies of each policy as directed
               by Article VIII of this Agreement.

4.6.3      CSC shall provide a revised Fee Schedule and Budget
           Narrative using the forms as provided by Attachment #12 to
           indicate the costs of the subcontracted services and a
           revised Attachment #1, Staffing Pattern, listing positions
           to be provided by the subcontractor(s).  If a per them cost
           adjustment (increase) is required, a formal amendment must
           be executed in accordance with Article IX of this
           Agreement.  If a cost decrease is required, Attachment #1,
           3 and 10 shall be revised.  The former Attachments shall be
           maintained on file to reflect the former Agreement.

4.6.3.1        If a cost adjustment is not required and the  subcontractor is by
               the Department,  Attachment #1 Staffing Pattern and Attachment #3
               Subcontractors  shall be  updated  to  reflect  approved  chanaes
               without requiring a formal amendment to the Agreement. The former
               Attachments  shall be  maintained on file to reflect the previous
               agreement.



Staff Training

4.7     CSC shall be required to provide staff training as follows:

        4.7.1  Pre-service  security  officer  training for personnel hired for
               designated security officer positions (See Paragraph 4.1.4.2).

4.7.1.1        Attachment #4 of this Agreement lists the Functional Areas and
               Course Titles to be contained in the pre-service training for
               security officers.  All courses, except those marked with an
               asterisk shall be taught in accordance with Department
               provided curricula and lesson plans.  Those Course Titles
               marked with an asterisk may be taught utilizing CSC's
               curricula and lesson plans, subject to approval by the
               Department's Administrator, Staff Development/Training Bureau
               or designee.

4.7.2      Required and optional pre-service non-security training courses
           (New Employee Orientation [NEO]) are listed in Attachment #5.
           Department curricula and lesson plans shall be utilized for the
           required courses.  Curricula for optional courses may be
           developed by CSC, subject to content being approved by the
           Department's Administrator, Staff Development/Training Bureau.
           On the first day of employment, new employees, volunteers,
           subcontractors, independent contractors, etc. shall receive at




<PAGE>



           least Phase I of the required training, i.e., Initial Orientation and
           Occupational  Safety.  Phase  11 of the  required  training  shall be
           presented  within  sixty  (60)  days  after  the  initial   training.
           Employees  who will have  significant  contact with inmates  shall be
           scheduled for Communicable Disease,  Basic Life Support and First Aid
           training within sixty (60) days after their date of hire.

4.7.3      The  Department  shall  provide to CSC,  at no cost,  copies of video
           tapes  developed by the Department for staff training  purposes.  CSC
           shall purchase direct from  identified  vendors any other video tapes
           required for staff  training.  The Department  shall provide CSC with
           the address and telephone number of designated vendors.

           4.7.4 Refresher  training shall be provided  annually to all staff to
           include    subcontractor(s)   and   their   employees,    agents   or
           representatives.  Security Officers shall be required, as part of the
           annual training to receive the below listed refresher training at the
           frequencies  indicated.  Basic Life Support and  First-Aid  refresher
           training  shall  be  provided  as  indicated  to all  staff  who have
           continual contact with inmates.

4.7.4.1        Non-Lethal Weapon Certification (annually)

4.7.4.2        Basic Life Support (every 2 years)

4.7.4.3        First-aid (every three years)

4.7.4.4 Use of Force (annually)

4.8     All Department training information  (curricula,  lesson plans, computer
        disks,  etc.) provided to CSC is proprietary  information  and CSC shall
        utilize the information  only for purposes of this Agreement.  CSC shall
        not disseminate the information to others for any purpose.

4.8.1      If,  during  the  term  of  this  Agreement,   the  Department  makes
           subsequent chances to the curriculum, copies of said changes shall be
           provided to CSC.  CSC shall  return all media,  to include any copies
           made by CSC, no longer  applicable  as a result of the change  within
           thirty (30) days after the change is implemented.

           4.8.2  Within  45  days  after  termination  of this  Agreement,  all
           documents,  computer  disks,  manuals,  etc.  provided  to CSC by the
           Department as well as all copies made by CSC shall be returned to the
           Department.





<PAGE>



         4.9      CSC's instructors must be certified by one of the following
         before providing training.

         4.9.1      Arizona POST (Peace Officer Standards and Training)
                    Staff Instructor

         4.9.2      Arizona Department of Corrections Staff Instructor

         4.9.3   Other - as approved by the Department

4.10     The  Department,  if requested,  may provide  instructor  certification
         training for CSC in the  following  areas.  Participation  by CSC staff
         shall remain at the discretion of the Department.

           4.10.1          Staff  Instructor -  Instructors  who must attend and
                           successfully  complete a 16 hour instructor  training
                           program  conducted by a senior instructor in order to
                           be recommended for certification.  An evaluation by a
                           Senior  Instructor  is required  every three years to
                           maintain certification.

           4.10.2          Senior Instructor - Instructors who are required
                           to attend and successfully complete an initial 40
                           hour training program conducted by a professional
                           trainer.  Completion of the program will qualify
                           senior instructors to conduct training and
                           recommend certification for regular instructors.
                           Senior Instructors must complete an 8 hour
                           professional instructor training course every
                           three years and are required to teach 36 hours
                           each year to maintain their certification.

4.10.3            Specialty Instructors - Instructors who have received
                  additional training in specialty areas, e.g., Basic
                  Life Support (BLS), Firearms Qualifications training,
                  First Aid, Cultural Diversity, Incident Management
                  System, etc.  In addition to maintain staff Instructor
                  certification, Specialty Instructors must maintain
                  certification in their specialty area, depending on course
                  requirements.

4.11     CSC shall submit the following  information to the  Department  Monitor
         within sixty(60) days prior receipt of the first inmate. Any changes to
         the initial  training plan after  approval by the  Department  shall be
         submitted  by CSC at  least  30 days  prior  to a  scheduled  training,
         session.

            4.11.1CSC's plan for the  provision  of  security  and  non-security
                  pre-service   training  to  include  at  least  the  following
                  information:




<PAGE>




                                    4.11.1.1    Location where training will be
                              provided, including OJT training.



               4.11.1.2       Time frames for presentation of the training,

               4.11.1.3       A description of the instructional methods to be
                              used, e.g., lecture, video tape, workbooks, etc.

               4.11.1.4       A  description   of  CSC   recordkeeping   methods
                              relative to staff  training to include  samples of
                              forms, computer data, etc.

               4.11.1.5       Curricula and lesson plans for required courses of
                              non-security   preservice   training  as  well  as
                              curricula  and lesson plans for any other  courses
                              CSC may provide at their option.

               4.11.1.6       A description of how and where medical, physical
                              and psychological examinations shall be
                              provided.

               4.11.1.7       Curricula and lesson plans for those course titles
                              marked with an asterisk as shown on Attachments #4
                              and #5.

               4.11.1.8       Identification of the instructors that will be
                              used to teach each course to include:

                                    The name of each instructor.

                                    Qualifications of each instructor by type of
                                    certification.

                                    Date    certification   was   received   and
                                    subsequent  refresher courses completed,  if
                                    any  (applies  to law  enforcement  training
                                    only).

                                    List of course topics each  instructor  will
                                    teach.

4.12     CSC shall submit to the Department Monitor an Annual
         Training Work Plan for inservice training within sixty (60)
         days prior to the need to deliver in-service training.
         Subsequently the Annual Training Work Plan shall be provided
         no later than May 15 of each year of the term of the
         Agreement and period of renewal, if any.  The Annual




<PAGE>



         Training Work Plan shall be submitted in the following format:

               4.12.1          Work plan introduction
               4.12.2          Institutional demographics
               4.12.3          Needs assessment
               4.12.3.1        Line staff needs.
 .              4.12.3.2        Supervisor/Manager needs.
               4.12.3.3        Department needs and mandates, including
                               required training
               4.12.3.4        Institutional needs and mandates.
               4.12.4          Annual calendar for trail
               4.12.5          List of certified instructs
               4.12.6          Training recommendation
               4.12.7          Approval/signature page

4.13     The Deputy Director,  or designee, in conjunction with the Department's
         Administrator,  Staff  Development/Training  Bureau,  shall  respond in
         writing to CSC indicating  approval or  disapproval  within thirty (30)
         days after receipt of the
         information.

           4.13.1 If any proposed  training segment is disapproved,  reasons for
           such  disapproval  shall be stated  and CSC shall be  allowed to make
           required  changes and resubmit the proposed  training  segment within
           thirty (30) days after receipt of the disapproval.

4.14     The Department shall provide two components of training to
         CSC staff prior to the assignment of the first inmate to the
         secure prison, as listed below.  CSC positions with duties
         assigned relative to the specialty training topics are
         critical to the successful operation of the secure prison.
         CSC staff in positions with duties assigned relative to the
         inmate systems shall be expected to develop a basic
         understanding of the various systems and to be knowledgeable
         of the role each position shall serve relative to each
         inmate system.

4.14.1 Specialty Training

4.14.1.1       Management  Information  Services:  Training on the  Department's
               Adult Information  Management System (AIMS), i.e., system access,
               data entry  requirements,  system  security.  The Department will
               provide any refresher training resulting from changes made to the
               system.

4.14.1.2          Inmate Records: Training on the requirements and
               processes for maintenance of inmate records as well as
               responsibilities of record-keeping personnel.
               Inexperienced CSC records staff shall be required to




<PAGE>



               participate  in six [6] weeks of training in an ADC prison  prior
               to receipt of the first inmate.  The trainer may then spend up to
               an additional week at the CSC facility with the trainee(s).

4.14.1.3       Inmate Accounting System:  Training specific to the management of
               inmate funds, i.e.,  deductions from inmate wages,  discharge and
               clothing  allowances,  and Work Incentive Pay Plan (WIPP).  CSC's
               Inmate  Accounting  System staff shall be required to participate
               in one week of training- in an ADC prison prior to receipt of the
               first inmate.

4.14.1.4       Case I work Management Training: This training is specific to the
               duties and responsibilities  equivalent to those performed by the
               position of a Correctional Officer III with the Department. Staff
               assigned case  management  duties will be required to participate
               in  four  (4)  weeks  of  on-the-job  training  in  a  Department
               institution.

4.14.2 Inmate Systems

4.14.2.1          Inmate classification system: This training will
               provide staff with the basic understanding of the
               Department's Inmate Classification system.

4.14.2.2       Inmate disciplinary  system:  This training,,  will provide staff
               with an understanding  of the inmate  disciplinary  process,  the
               rules of  discipline,  and their role in the  enforcement  of the
               rules of discipline.

4.14.2.3       Inmate grievance system:  The training will provide staff with an
               understanding of the inmate  grievance  process and their role in
               the process.

           4.14.3 Initial training for the specialty training and inmate systems
           as well as supplemental  training required due to the introduction by
           the  Department  of  procedural  revisions  shall be  provided by the
           Department at no cost to CSC. The Department shall furnish to the CSC
           Warden at the  conclusion  of each  training,  technical  manuals  or
           curriculum for use by CSC in the provision of training to replacement
           staff or as  refresher  training,  except for training for the Inmate
           Accounting   System.   Technical   manuals  relative  to  the  Inmate
           Accounting  System  shall be used by CSC staff  relative  to required
           procedures. The Department shall not provide further no cost training
           to CSC staff.

4.14.3.1          CSC shall not be required to train staff relative to the In-
               mate Accounting System.  Department Central Office staff shall
               provide initial training and necessary supplemental training




<PAGE>



               to  those  CSC  staff   assigned   responsibilities   for  inmate
               accounting  activities.   The  Department  shall  charge  CSC  as
               described below if requested to repeat Inmate  Accounting  System
               training  for the  same  CSC  staff  within  six  months  after a
               training session has been conducted.

             4.14.4  CSC  requests  to  the  Department  for  training  relative
             Specialty Training or Inmate Systems in excess of what is described
             above shall require,  if approved,  CSC to reimburse the Department
             for  staff  time  and any  other  associated  costs,  e.g.,  travel
             expenses  and  overtime  (as  such  costs  are   applicable).   The
             Department  shall,  within  thirty  (30)  days  after  training  is
             provided,  invoice  CSC based on actual  costs as  determined  from
             travel receipts,  Positive  Attendance Reports (PAR) and salary for
             each employee providing  training.  CSC shall submit payment to the
             Department  within  ten (10) days  after  receipt of invoice at the
             following address:

         Arizona Department of Corrections
         Attention: Administrator, Bureau of Business & Finance
         1601 West Jefferson Mail Code 210
         Phoenix, Arizona 85007

4.14.5       A CSC staff vacancy in a position providing- services
             required by the specialty training topics will severely
             impact the management of the assigned inmate population.
             CSC shall ensure that adequate numbers of CSC staff are
             trained and have the knowledge, skills and ability to
             complete daily tasks required for the specialty training
             topics.  CSC shall be responsible for the adequacy of the
             CSC provided training, e.g., qualifications of trainers,
             timeliness of each training segment and presentation,
             based on Department provided technical manuals and
             curriculum.  Failure on the part of CSC to provide the
             required staff or the required training may result in an
             Event of Default being declared in accordance with Article
             X.

4.15     CSC  staff,  approved  by  the  Department,   may  participate  in  the
         Department  Train-theTrainer  program  to allow  CSC  staff to  provide
         on-going training in technical areas as authorized by this Agreement.

4.16     CSC shall hold the Department,  harmless from liability claims of third
         parties arising recruitment/hiring/staff training,, processes set forth
         in this Article.

                                    ARTICLE V
                       PROVISION, OPERATION AND MANAGEMENT




<PAGE>



                              OF THE SECURE PRISON

5.1      CSC shall construct the secure prison's infrastructure and
         support systems as soon as possible in accordance with the
         segments of time specified in CSC's milestone chart as
         submitted on November 6, 1996.  The Department may declare
         an Event of Default, as permitted by Article X of this
         Agreement, if any time segment specified in CSC's milestone
         chart is not met and a Force Majeure occurrence has not been
         declared.

5.1.1      The secure prison shall be constructed by CSC's architect
           and construction contractor in accordance with the Contract
           Documents for the project as defined in the Fourteenth
           Edition of the AIA Document A201 - General Conditions for
           contracts for construction, as well as Department
           requirements and applicable laws, rules, standard, codes,
           etc., as specified in Article III, Paragraph 3.5. 1.
           Simultaneous submission of the Contract Documents by CSC to
           the local planning and zoning office and to the Deputy Director shall
           occur. The secure prison shall be located on an 18 acre site in Pinal
           County  within the city limits of  Florence,  Arizona as described in
           Article III and shall have,, at least:

5.1.1.2        One 14 foot loop top perimeter  fence with  "no-climb"  (1/4 inch
               hardware  cloth)  at the  top six (6)  feet of the  fence  on the
               inside.  The mesh at the bottom of the fence shall be embedded in
               a concrete base.

             5.1.2.3       Eighteen inch (18") razor wire on the top of the
             fence at feast at , those points where the perimeter fence
             abuts to a building and where. fences adjoin the
             perimeter.

5.1.3.4        Adequate  security  to ensure  that  inmates  remain  within  the
               perimeter and to prevent access by the general public.

5.1.4.5        Secure locks on all outside doors.

5.1.5.6    A par course.

5.2      Notwithstanding  the milestone chart referenced in Paragraph 5.1 above,
         CSC shall, after receipt of notice to proceed from the Department,  use
         due  diligence to construct  the secure  prison  within the stated time
         frames.

5.2.1      It is understood that the CSC proposal was submitted and
           contract award was made with the understanding that the




<PAGE>



           Town of  Florence  sewer  system  would serve the secure  prison.  On
           November 5, 1996 CSC and the Department received notice from the Town
           of Florence that there was not adequate  capacity within the existing
           sewer lines to  accommodate  the secure prison as well as other users
           and, that until the problem was resolved by the Town of Florence, the
           secure  prison  could not be  connected  to the sewer  system.  It is
           mutually  agreed that it is critical to both parties for this project
           to  progress  in a  timely  manner.  CSC will  work  with the Town of
           Florence  toward a  solution  that  allows  the  secure  prison to be
           connected to the Florence  sewer  system.  There shall be no costs to
           the Department for CSC to rectify this problem.

5.2.2      The secure prison shall be constructed solely for the
           purpose of housing and the treatment of inmates assigned to
           the secure prison by the Department.  CSC shall not house
           other jurisdictions within the secure prison and shall not
           in any way alter the size, configuration or mission of the
           secure prison nor allow the perimeter fence of the secure
           prison to be adjoined to another facility without a formal
           amendment to this Agreement.

5.2.3      During the construction  phase, CSC shall provide to the Department's
           Contracts  Administration Office via the assigned Department Monitor,
           one copy of each approval required by statute or regulation  received
           from a regulatory agency and one
           copy of each waiver granted.

5.2.4      When  notified  in writing by CSC that the secure  prison is ready to
           receive  inmates,  the Department  shall  transport a mutually agreed
           number of  inmates  to the secure  prison at agreed  upon  intervals.
           CSC's  written  notice shall be directed to the Deputy  Director,  or
           designee  with a copy to the  Department's  Contracts  Administration
           Office.

5.2.4.1 The number of inmates  delivered  shall be determined by the  Department
with  consideration of the capability of CSC and the secure prison to accept the
inmates,  e.g.,  receipt of  certificate of  substantial  completion  from CSC's
architect,  prison capacity, adequate staffing levels, adequate security systems
and - inmate management services to accommodate the inmates.

5.2.5      Subsequent to initial occupancy, the Department shall deliver inmates
           as CSC notifies the Department Monitor of availability of beds.

         5.3      CSC shall maintain the secure prison in accordance with
         existing federal, state and/or local building,, health,




<PAGE>



         safety and fire codes.  The secure  prison shall meet ACA Standards and
         ADAAG as each is defined herein.

5.3.1    The Department  shall not assume any expense for the maintenance of the
         physical  structure or any tangible  personal  property  attached to or
         contained  within  the  secure  boundaries  and  physical  plant of the
         prison.

               5.3.1.1 If the secure  prison is damaged or  destroyed by fire or
               acts of nature  during the term of this  Agreement,  CSC shall be
               responsible  for all costs to  rebuild,  restore  or  repair  the
               secure  prison,  including  costs  to  relocate  and  manage  the
               assigned inmates during repair or restoration. CSC relocation and
               management of the assigned inmates shall be subject to Department
               approval.

5.3.2      CSC shall be responsible  for all costs to correct  potential or real
           risks as such  relate to the secure  prison  structure  or the secure
           perimeter.

5.4 CSC shall provide buildings equipment, materials and personnel necessary for
the housing of assigned inmates as well as for the maintenance and repair of the
secure prison.

         5.5 The Department  shall have sole  authority to determine:  (i) which
         inmates  shall be assigned to the secure  prison;  and (ii)  whether an
         inmate  shall  be  removed  from  the  secure   prison  after   initial
         assignment.  Such  determinations  may be based on, among other things,
         the Department's inmate  classification  system, the screening criteria
         relative to the secure prison, the committing- offense and the inmate's
         ability to  participate  in CSC  treatment  program  as each  factor is
         applicable to RTC or DUI inmates.

5.6      CSC's security manual, procedures and post orders as
         required by Department Service Specifications, Objective
         III.  E. shall include at least:

5.6.1    A  "secure"  armory,   i.e.,  hardened  walls  and  ceiling,  to  store
         non-lethal  weapons,  ammunition and chemical agents in compliance with
         Department written  instructions.  Plans for hardening the armory shall
         be subject  to review by the Deputy  Director  prior to  issuance  of a
         notice to proceed.

5.6.2      In accordance with the Department's  Incident  Management System, CSC
           shall  remain in  control  of the  situation  until  relieved  by the
           Department.

5.6.2.1           Agreements with local law enforcement authorities may
be executed.  The Agreements shall stipulate that such




<PAGE>



authorities shall assist in providing outside perimeter security,  but shall not
enter the secure prison to assist in  controlling  the inmate  population.  Such
Agreements  shall be submitted to the Deputy Director,  or designee;  for review
and approval prior to execution.

5.6-2.2        Providers of firefighting  and emergency  medical  services shall
               have access to the secure prison during  emergency  situations as
               requested  by  CSC  and  in   accordance   with  CSC's   security
               requirements.

           5.6.3 Direction to staff regarding the use of restraints and physical
           force in  accordance  with the  Department's  Use of Force  Policy in
           relation to at least the following circumstances:

5.6.3.1        On the grounds of the secure prison

5.6.3.2        Supervising inmates outside the secure prison

5.6.3.3     At times of an escape

Inmate Management Services

5.7      CSC's institutional  orders and post orders shall address each category
         listed under  Objectives III through VI of the Service  Specifications.
         Institutional  orders and post orders  regarding the inmate  management
         services  identified below shall incorporate the requirements herein as
         well as the requirements of Department written instructions.

5.8      Transportation - Eligible inmates shall be transported to
         the secure prison by the Department.  The Department shall
         also transport any inmate(s) being returned to the
         Department.  CSC may be required to transport inmates who
         are returned to the Department if the transportation does
         not correspond to the Department's normal transportation
         schedule.

5.8.1    Department or County Sheriff  personnel shall transport  inmates to the
         appropriate Court jurisdiction relative to detainees for new charges.

5.8.2      Department staff shall transport inmates who are transferred from the
           secure  prison to  increased  custody  within the  Department  prison
           system.

5.8.3      CSC shall  provide  all other  transportation  services  for  inmates
           assigned to the secure prison to include  operational  support of the
           secure I e prison and transportation services described below:




<PAGE>




5.8.3.1        Delivery  and  pick  up  of  inmates  assigned  to  outside  work
               assignments, unless the Department is able to negotiate alternate
               transportation arrangements in agreement with outside entities.

5.8.3.2        Delivery  and pick up of inmates  for  outside  court,  hospital,
               medical, dental, mental health appointments, etc.

5.8.3.3   Emergency medical transportation.

 5.8.3.4  Any other transportation needs of the secure prison.

         5.9 Management Information System (communicating,  inmate records, data
         processing  and  information  services).  CSC  shall  emulate  existing
         Department computer equipment as described in the computer equipment as
         authorized  staff shall allow CSC  Computerized  Adult  Information Men
         (AIMS) relative to those inmates  assigned to the secure prison.  CSC's
         computer  hardware  shall be located in a secure  area of the prison to
         ensure access only by personnel authorized by the Department. CSC shall
         provide,  at no cost to the Department:  (i) one dedicated  printer and
         one check protector for the purposes of inmate banking,-; (ii) at least
         one computer terminal to be used exclusively for inmate banking.

5.9.1    Prior to system  access,  CSC shall submit a listing of staff names for
         security  password  clearance.  Identified  staff  shall be required to
         attend  training  provided by the Department  relative to the basics of
         AIMS. Only authorized staff of CSC shall be permitted to use AIMS.

5.9.1.1        Department MIS staff shall perform periodic audits
               relative to system access.

5.9.2      Data contained in the Department's AIMS System shall not be
           downloaded to CSC's independent information system.

5.9.3      The Department  shall deliver  special  purpose records to the secure
           prison  at the  time  each  inmate  is  delivered.  Any  document  or
           information  maintained in the special  purpose records which is also
           maintained in the Department's official Master File is subject to the
           same  privacy and security  regulations  as the  Department's  Master
           File.

5.9-3.1     CSC shall maintain confidentiality in accordance with
A.R.S. 31-221, Master Record File: information from other
agencies; confidentially of files as well as Paragraph 7 of the
General Provisions of this Agreement.





<PAGE>



               5.9-3.2 Special purpose records provided by the Department are to
               be maintained in a locked and secure area with limited  access in
               accordance with Department written instructions.

           5.9.4  The  Department's  special  purpose  records  are  transferred
           through the correctional  system with the inmate;  therefore,  CSC is
           required  to  maintain  such  records in good order and in the format
           required by Department written instructions. Upon an inmate's release
           from the secure prison either by transfer to another Department shall
           be returned to the Department.

5.9.5      CSC shall be required to maintain  electronic  data as well as manual
           inmate records in accordance  with Department  written  instructions.
           The  establishment  and  maintenance of inmates files  (electronic or
           hard copy),  other than those  specifically  authorized by Department
           written instructions, is prohibited.

5.9.6      CSC shall utilize the Department's Inmate Accounting System and shall
           be  accountable  for  inmate  banking  transactions  from the date of
           receipt of an inmate  until the date the inmate is released  from the
           secure prison and the account is closed.

5.9.7      It is expressly understood that pursuant to Paragraphs 7
           and 8 respectively of the General Provisions provided with
           this Agreement and the requirements of A.R.S. 35-214, CSC
           shall be required to ensure confidentiality of information
           maintained.  All source documents and other relevant hard
           copy records relating to in-mate banking transactions shall
           be maintained by CSC during the term of this Agreement, and
           for five (5) years after the date of termination or
           expiration of this Agreement.

5. 10 Inmate Work Activities

                5.10.1 Prison Work  Activities - Inmates  assigned to the secure
           prison  shall be required to work in  compliance  with A.R.S.  31-251
           Hard labor require of prisoners;  labor  classification;  definition.
           All prison work activities shall be performed within the perimeter of
           the  secure   prison,   except  that  the  Department  may  consider,
           consistent with Department  written  instructions,  allowing selected
           inmates to work outside the secure perimeter of the prison. CSC shall
           comply  with A.R.S.  31-251 by  implementing  a Prison  Work  Program
           whereby jobs within the secure prison will be created for RTC and DUI
           inmates.





<PAGE>



                5.10.1.1  The   Department   Monitor   shall  approve  the  jobs
                identified  in CSC's Prison Work Program and the  allocation  of
                said jobs by skill  level to ensure  that each is in  compliance
                with Department objectives
                regarding pay and work  assignments.  After initial  approval of
                jobs, skill levels and wages,  changes shall not be initiated by
                CSC without prior written approval of the Department Monitor.

  5.10.1.2      Wages earned by inmates participating in the Prison Work Program
                shall be in compliance  with  Department  written  instructions,
                regarding inmate wages.

  5.10.1.3      During  the term of this  Agreement,  CSC shall  process  inmate
                payroll sheets for payment of inmate wages on a bi-weekly  basis
                and in accordance with the inmate accounting system. All payroll
                sheets are to be  processed  through the  Department's  Contract
                Monitor for  verification  of payroll charges prior to submittal
                to the CSC inmate banking technician.

5.10.1.4  Each  month,  during  the term of this  Agreement,  a list of all jobs
within the CSC Prison Work Program shall  accompany  the second  inmate  payroll
request.  The list shall  indicate  which jobs have been filled  during the last
thirty-day period,  total inmate wages earned for each job, and the average wage
earned for the thirty-day  period.  The list shall also identify any problems or
concerns CSC may have regarding the Prison Work Program in any given  thirty-day
period.  The Department  Contract Monitor may request CSC to provide  additional
information  to verify that the CSC Prison Work Program is meeting the intent of
A.R.S. 31-251 and the mission of the secure prison.

The  Department  Monitor  shall  immediately  advise the CSC Warden of  concerns
identified in review of the monthly listing of inmate jobs, average pay or level
of work activity  based on the content of the report or based on  observation of
inmate  performance as part of the routine  monitoring of inmate activity within
the secure prison.

5.10.2       Inmate Work Agreements - Work  activities  authorized by multiparty
             agreements between and among the Department, CSC and other entities
             that will allow  provision  of inmate  labor off the grounds of the
             secure prison (A.R.S. 31252 or A.R.S 41-1624.01).

5.10-2.1          Entities interested in using DUI labor shall be
               identified.  Negotiations conducted by the Department
               regarding such agreements shall include concerns of CSC.
               The Department shall be responsible for preparation,
               finalization and maintenance of all DUI inmate work




<PAGE>



               agreements  generated in support of the secure prison.  This does
               not restrict CSC from seeking and  developing  work  arrangements
               for Department consideration.

5.10.2.2       CSC shall be responsible, if required by the terms of each inmate
               work    agreement,    for   providing    security    supervision,
               transportation, lunches, etc., for such work activities.

5.10.2.3       CSC shall be  responsible  for ensuring the  provision of medical
               services  for  injuries or  illnesses  incurred by inmates  while
               participating in a work program, contracted or other-wise, unless
               otherwise specified in an agreement.

Emergency medical services required due to an injury or illness that occurs at a
contracted  work site may be provided or arranged for by the work  Contractor in
order to protect the life or limb of an inmate.

5.11     Inmate  Education   Services  shall  be  provided  in  accordance  with
         Department  written  instructions and the requirements set forth in the
         Secure DUI Service Specification provided as Attachment #1 to RFP 6702.

        5.   11. CSC shall ensure the availability of a certified GED
             tester at no extra cost to the Department.

5.11.2       CSC shall be required to comply with the requirements of
A.R.S. 31-229, Functional Literacy Program: Evaluation;
Certificate: Exemptions; Wages; Definition

5.11.2.1          The Department shall administer an educational
               evaluation in accordance with the requirements of A.R.S.
               31-229, to include a standardized assessment test, prior
               to assignment of an inmate to the secure prison.

5.11.3     CSC's education  services for DUI inmates shall include,  in addition
           to  the  Functional  Literacy  Program,  the  following   educational
           components:

5.11.3.1          GED Preparation - To be provided to DUI inmates who do
               not have a high school diploma or GED.  The classes shall
               be conducted by a DOE certified instructors

5.11-3.2 Life Skills - Classes shall be open-entry/exit and self-
paced.

5.11.3.3    Release Preparation - Classes shall be open-
entry/exit and self-paced.




<PAGE>




5.11.4            During the term of this Agreement, CSC shall endeavor
           to utilize the resources of a local Community College
           District via contract or grant to enable District
           instructors to provide the educational services described
           herein, thereby affording more economical service to the
           Department.  CSC shall provide information as required by
           Article IV, Paragraph 4.1.6 and Paragraphs 4.6 through
           4.6.3.1 on all positions.

5.11.4.1       Any per them rate  reduction as a result of  utilizing  Community
               College  District   instructors   shall  not  require  a  written
               amendment.

           5.11.5          Inmates shall not be paid for participation in the
           Functional Literacy Program or any other educational program
           provided by CSC.

         5.12 shall be provided  for all assigned  inmates by CSC in  accordance
         with Department  written  instructions.  An  institutional  chaplain or
         equivalent  shall be on duty eight (8) hours each  Saturday and Sunday.
         The chaplain  shall be hired in  accordance  with the  requirements  of
         Article IV, Recruitment Hiring

         5.13 Inmate Clothing, including replacement clothing, shall be provided
         by CSC in accordance with  Department  written  instructions.  Personal
         clothing  consistent with the referenced policy can be worn by assigned
         Inmates.

5.13.1       The Department  shall provide  discharge  allowance for clothing to
             eligible   inmates   in   accordance   with   Department    written
             instructions.

         5.14 Food Services shall be provided. by CSC in accordance
         with the requirements contained in RFP 6702.

5.14.1            CSC shall evaluate the food service delivery operation
           within 60 days after the close of the first year of this
           Agreement.  The evaluation shall include an analysis, on a
           monthly basis, of at least the following: number of meals
           prepared, number of meals served, amount of waste, economy
           of food usage, inmate complaints regarding food service,
           quality of food content, menu content and the per meal
           costs.  The completed evaluation shall be provided to the
           Department Monitor.

               5.14-1.1   If the evaluation demonstrates the need for a
               cost increase relative to the provision of food services,
               said change shall be made in accordance with A.R.S. 41-




<PAGE>



               1609.01 E. and Article IX of this Agreement. If a need for a cost
               decrease is presented,  CSC shall provide the Department  Monitor
               with completed Fee Schedule and Budget  Narrative  forms provided
               as Attachment #12 to this In Agreement, along with an explanation
               of the  decrease  and the  proposed  reduced per them rates.  The
               Department  Monitor  shall  forward  the  request  to the  Deputy
               Director for  approval/disapproval.  A formal amendment shall not
               be required for a cost decrease.

           5.14.2 Meals shall be provided which follow the Department's six week
           cyclical  menus  and  that  meet  the   Department's   Standard  Menu
           Nutritional  Guidelines.  Department  shall be used for all raw foods
           used in preparation of meals. Changes relating to food specifications
           and the cyclical  menu must be approved by the  Department in writing
           prior to implementation  excepting those infrequent  situations where
           unavoidable  delays in shipments of food products require  innovative
           short-term  actions by CSC.  In these  situations  a report  shall be
           submitted  to the  Department  Monitor for review.  The  Department's
           specifications and menu shall be updated to reflect any approved long
           term  change.  The  Deputy  Director  shall   approve/disapprove  any
           chances.

           5.14.3 The  Department  reserves  the right to require  CSC to effect
           changes in the food service  operation at any time during the term of
           this Agreement, if provided services are determined by the Department
           to be inadequate.

5.15     earth Services shall be provided by CSC, to include medical,
         optometric, dental, pharmaceutical and mental health
         services.  Health services shall be provided by the
         subcontractor shown on Attachment #3 in accordance with: (i)
         existing community standards of care and the requirements
         contained herein; (ii) those requirements specified in RFP
         6702; and (iii) Department written instructions relative to
         the provision of Health Services which CSC has received from
         the Department.

5.15.1 CSC shall provide Registered Nurses, to serve as the Head Nurse who shall
work 40 hours per week,  on-site at the secure  prison and shall be available on
call, 24 hours per day, 7 days per week to provide coverage of the secure prison
for  emergency  situations.  Shift nurses may be  Registered  Nurses or Licensed
Practical Nurses. Nurses shall be trained in emergency First-Aid and possess Red
Cross, certification to perform Basic Life Support.





<PAGE>



               5.15.1.1 CSC shall ensure inmate access to  non-emergency  health
               care a minimum of five (5) days per week.  Inmates  in  detention
               status shall have  non-emergency  health care available seven (7)
               days per week.

5.15.1.2       Staffing  patterns for providers of medical,  optometric,  dental
               and mental health services shall be in accordance with Attachment
               #1 and  requirements  set forth in Article IV of this  Agreement,
               Recruitment  and Hiring.  CSC shall  provide a licensed  clinical
               psychologist to provide Mental Health Services.

5.15.1.3       CSC shall ensure that health  service  staff shall not be used to
               collect  urine  samples  for the  purpose of testing  for illegal
               substances as part of the institution monitoring and surveillance
               program.

5.15.1.4       CSC shall identify any inmate(s) who becomes  seriously  mentally
               ill  after  assignment  to  the  secure  prison  and  advise  the
               Department  Monitor who shall coordinate  appropriate action with
               Department health staff-relative to the identified inmate(s).

5.15.2       CSC shall ensure that, whenever possible, medications prescribed by
             health providers shall comply with the Department's formally.

5.15.2.1       Medications  shall be packaged either in unit dose, daily dose or
               weekly amounts, depending upon the type of medication.

5.15.3     CSC shall  enter into  contracts  with  hospitals  located  within 30
           minutes  transport time from the secure prison in order to ensure the
           availability of emergency services 24 hours per day, 7 days per week.
           CSC shall ensure  availability of services with a hospital capable of
           providing a secure ward to house inmates in need of  in-patient  care
           and treatment.

5.15.3.1       CSC shall, consistent with Departmental written instructions,  be
               responsible for providing security staff coverage at the hospital
               for inmates transferred for in-patient or out-patient care.

5.15.4            CSC shall ensure availability of emergency medical
           transportation to handle emergencies as they occur.

5.15.5       Medical records provided by the Department to CSC shall be
             maintained in a secure, locked area.





<PAGE>



               5.15.5.1 CSC shall duplicate  Department medical record forms for
               inclusion  in the  inmate  medical  record  while  the  inmate is
               assigned to the secure prison.

           5.15.5.2  Information  contained  in a  medical  record  shall not be
                released  to I anyone who is not legally  authorized  to receive
                it. Health and mental health records shall not be made available
                to security staff.

5.15.6            Except for assigned RTC inmates, the Department shall
           assume high cost health care in cases where CSC has
           incurred costs which exceed $10,000 for a single diagnosis
           per inmate per contract year.  As used herein, "diagnosis"
           shall mean the determination of the nature of a disease or
           injury.  Multiple diseases or injuries arising, from the
           same event or root cause shall be considered a single
           diagnosis, whether such diseases or injuries occur at the
           same time or at separate times.  An inmate whose health
           care costs fall into the category of high cost shall be
           returned to a Department institution or contracted medical
           care facility after CSC has incurred cost in excess of
           $10,000 as described above, or as soon thereafter as
           feasible.

               5.15.6.1  CSC shall pay for an inmate's  "high cost health  care"
               (defined in Paragraph 5.15.6) up to $10,000 and return an invoice
               reflecting  any balance over  $10,000 to the medical  provider to
               forward to the Department for payment.

5.15.6.2          Any non-emergency medical care for an inmate which
               requires hospitalization shall require compliance with
               the Department's outside review committee procedures and
               meet the Constitutional mandate of the 8th and 14th
               amendments.  Prior to initiation of service delivery,
               CSC's primary medical care provider shall participate in
               the Department's Health Services Provider Orientation
               Program.

               5.15.6.3  Regarding  RTC inmates,  the  Department  shall pay for
               costs of  hospitalization of RTC inmates admitted after emergency
               medical  treatment  and for  medical  costs of RTC  inmates  with
               chronic conditions  requiring regular medical examinations and/or
               treatment. The Department shall assume supervision of RTC inmates
               admitted to the hospital within eight (8) hours after  admission.
               For the purpose of this Agreement,  the following  conditions are
               considered chronic:  Cancer, Insulin Dependent Diabetes,  Seizure
               Disorders,  Heart  Disease,  Respiratory  Disease,  Tuberculosis,
               HIV/AIDS, Serious Mental Illness (as




<PAGE>



               defined by Department written instructions).  The inmate's health
               condition shall be determined by the Department's  Health Service
               staff.

5.15.7 CSC shall provide quality assurance and utilization review activities and
processes  relative to the  delivery of inmate  health  services as described in
Section 11 of CSC's proposal, Quality Assurance Program, page 16 of 18.

5.15.7.1  Statistical  data relative to the utilization of health services shall
be -maintained by CSC who shall prescribe the collection of basic health, mental
health and dental service information,  utilization,  summary,  program cost and
time distribution data.

 5.15.8 CSC shall charge  inmates for  Healthcare  services in  accordance  with
A.R.S.31-201.01 and Department written instructions.

         5.16  Substance  Abuse  Treatment  Services  shall be  provided by CSC.
         Services  shall be provided by qualified  staff in accordance  with the
         guidelines and requirements  stated in RFP 6702.  Bilingual  counselors
         capable of providing  services in Spanish and English  using  materials
         provided in both languages shall be available in numbers required to be
         effective with a 400 bed DUI prison population.

         5.17 Inmate  Welfare and Benefits  Fund (W&B Fund) - the secure  prison
         shall  have a W&B Fund  managed  by CSC to be used for the  benefit  of
         assigned  inmates.  The account shall be funded from profits  resulting
         from the sale of  commissary  goods and from  revenues  received by CSC
         from the Department's vendor for use of the inmate telephone system.

           5.17.1  CSC shall  manage the W&B Fund in a manner  identical  to the
           manner  in  which  the  Special  Services  Fund  is  managed  by  the
           Department and consistent with the provisions of written instructions
           which govern the Special Services Fund.

5.17.1.1       Monies  earned by CSC from the inmate  telephone  system shall be
               forwarded from the vendor of the  Department's  inmate  telephone
               system directly to CSC for deposit in the W&B Fund.

               5.17.1.2  Net income from the sale of  commissary  goods is to be
               distributed  to the W&B Fund as shown  under  Inmate  commissary,
               Paragraph 5.19.2.





<PAGE>



               5.17.1.3  At the  conclusion  of this  Agreement,  whether due to
               expiration or termination,  all remaining capital and inventorial
               equipment which was purchased with W&B funds shall be transferred
               to the Department.

           5.17.2 CSC shall,  at least ninety (90) days prior to  acceptance  of
           the  first   inmate,   submit   for   Department   approval   written
           institutional  orders  supporting  the  management of the W&B Fund to
           include  directions  relative  to the  use of a  competitive  bidding
           procedure for purchases from the W&B Fund.

           5.17.3 During the term of this Agreement, the Department shall review
           all  proposed  CSC  expenditures   from  the  W&B  Fund  relative  to
           compliance with all related  Department  written  instructions and to
           assure  that  security  and safety  issues are not  compromised  by a
           proposed  purchase.  Such  review  by  the  department  shall  not be
           considered  to be an approval of any purchase or of any fiscal issues
           relating to the W&B Fund or purchases therefrom.

5.17.3.1  Costs for the  operation of the inmate  commissary  may be paid by CSC
from the W&B  Fund,  e.g.,  salary  costs  of a  Commissary  Manager,  equipment
required to provide  commissary  goods to inmates such as ice machines,  freezer
boxes, etc.

5.17.3.2       Major  purchases  by CSC with W&B Funds shall  require the use of
               competitive  sealed  bidding  processes  that conform to standard
               procurement practices. Major purchases are defined as:

               Purchases  estimated  to cost in excess of  $5,000,  which  shall
               require multiple written quotations.

               Purchases  estimated  to cost from  $1,001 to $5,000  which shall
               require multiple verbal or written quotations.

5.17.3.3       Purchases  made with monies from the W&B Fund must conform to and
               be  consistent  with the types of items  authorized  for purchase
               from the Department's Special Services Fund.

5.17.4       After one year of operation,  the financial  status of the W&B Fund
             shall be reviewed by CSC and the  Department  to determine  whether
             adequate  funds are available to  accommodate  per them expenses in
             the  form of  costs  for  recreational  and  library  supplies  and
             equipment.  If it is  mutually  agreed  that  adequate  monies  are
             available within the W&B Fund to accommodate such expenses, the per
             them




<PAGE>



             rates  shown on  Attachment  #10 shall be reduced  to reflect  the
             transfer of the expenses to the W&B Fund.

5.17.4.1          Any reduction in per them shall be verified by
               submittal by CSC of revised Fee Schedule and Budget
               Narrative forms, as provided by Attachment #12, to
               reflect removal of such expense items from the per diem.
               The completed Fee Schedule and Budget Narrative forms
               shall be submitted to the Deputy Director, or designee
               with a copy provided to the Contracts Administration
               Office in accordance with time frames stipulated by the
               Department.

5.17.4.2       The Deputy  Director or designee  shall review the CSC documents
               and request,  if  necessary,  additional  information. A revised
               Attachment #10 shall be prepared by the Contracts Administration
               Office to reflect the mutually agreed
               reduced per them rates.

5.17.4.3          The revised Attachment #10 shall replace the existing
               Attachment; however, the former Attachment shall be
               retained on file to reflect the former agreement.  A
               formal written amendment shall not be required to
               accommodate a reduction in per them due to transfer of
               expenses from per them to the W&B Fund, unless such
               reduction impacts programmatic aspects of required
               services.  If required services are impacted, a formal
               amendment as required by Article IX shall be required.

5.17.5     CSC  shall  provide  to the  Department's  Administrator,  Bureau  of
           Business & . Finance,  all financial  reports  required by Department
           written instructions.  A copy of each report shall be provided to the
           Department Monitor.

           5.17.6 In the event this Agreement is terminated as permitted herein,
           CSC shall return all funds  deposited in the secure prison's W&B Fund
           along with the close-out  Special  Services  (A&R) Fund Report to the
           Department at the following address:

                            Department of Corrections
                Attn: Administrator, Bureau of Business & Finance
                          1601 West Jefferson, M/C 210
                             Phoenix, Arizona 85007

5.18     Inmate  Telephone  System - Inmates assigned to the secure prison shall
         have access to an inmate telephone system. For reasons of security, the
         same  in-mate  telephone  system and  vendor as used by the  Department
         shall be used by CSC.




<PAGE>



         Inmate telephone services shall be made available in a manner identical
         to that described in Department written instructions.

           5.18.1 Revenues earned as a result of CSC use of the inmate telephone
           system  shall be  directed  from the  Department's  vendor to CSC for
           deposit in the W&B Fund to be used for the  benefit  of the  assigned
           inmates.

           5.18.2 CSC shall,  at least ninety (90) days prior to  acceptance  of
           the  first   inmate,   submit   for   Department   approval   written
           institutional  orders  regarding  the provision and use of the inmate
           telephone  system to include use of revenues  received as a result of
           use of the telephone system.

5.19     Inmate  Commissary  - Inmates  shall have  access to a  commissary  for
         purchase of goods.  Items sold in the commissary shall include items as
         described  in  Department  written  instructions,  but for  reasons  of
         security, may not include any additional items.

5.19.1       The maximum allowable mark-up of goods for sale in the
             commissary may not exceed ten percent (10%).

5.19.2 Net income  from the sale of  commissary  goods shall be  distributed  as
follows:

5.19.2.1          Fifty percent (50%) for reimbursement to CSC for
               initial commissary capitalization.

5.19.2.2          Fifty percent (50%) to the W&B Fund.

5.19.2.3          Upon reimbursement of CSC's initial commissary,
               capitalization, 1 00 % of the net income earned. from the
               sale of commissary goods shall be deposited to the W&B
               Fund.

5.19.3 CSC may have access,  through the Department's  Central Office Purchasing
Manager, to State contracts for goods to be sold in the commissary. Use of State
contracts is not  required  and CSC may  negotiate  directly  with  suppliers in
accordance with Department written  instructions and guidelines provided herein.
It is the  expectation  of the Department  that  commissary  inventory  shall be
purchased at the lowest possible cost.

5.19.4       At the conclusion of this  Agreement,  whether due to expiration or
             termination,  the remaining  inventory in the  commissary  shall be
             sold and the proceeds shall be directed to any remaining balance of
             the initial




<PAGE>



             commissary  capitalization.  Revenues  remaining from the inventory
             liquidation  shall be deposited  in the W & B Fund,  with the final
             closing,  balance  of  the W & B  Fund  to be  transferred  to  the
             Department's Central Office A&R Fund.

           5.19.5 CSC shall,  at least ninety (90) days prior to  acceptance  of
           the  first   inmate,   submit   for   Department   approval   written
           institutional  orders  regarding  inmate  commissary   operations  to
           include  directions  relative  to the  use of a  competitive  bidding
           procedure for purchase of commissary goods.

5.20     Investigations of all alleged criminal activity involving
         --------------
         Department inmates assigned to the secure prison shall be
         conducted by representatives of the Department's Inspections
         and Investigations Division.  The Department Monitor shall
         be notified immediately by CSC of suspected criminal
         activity.  The Department Monitor shall be responsible for
         subsequently notifying appropriate Department authorities
         regarding the alleged activity.

5.20.1            All allegations of criminal activity relating to the
           operation of the secure prison
           or Department operations shall be investigated by the
           Department in accordance
           with A.R.S. 41-1604, et seq.

5.20.2            The Department shall conduct any investigation it deems
           necessary involving Department inmates.



<PAGE>








                                   ARTICLE VI
              PAYMENT OBLIGATIONS AND PROCEDURES/FINANCIAL REPORTS

6.1      Requirements Governing All Cost Increases

         6.1.1      During the initial term of this Agreement (three [3]
                    years), price or cost adjustments may be made as
                    authorized by A.R.S. 41-1609.01 A. D., or E., and the
                    requirements set forth in Article IX.

6.1.2      If this Agreement is renewed as permitted by A.R.S. 41-
           1609.01 L, any negotiated price or cost adjustment must be
           authorized in accordance with A.R.S. 41-1609.01 D or E and
           shall be formalized by written amendment as required by
           Article IX.

6.2      Per Diem

         6.2.1      The amount of per them paid per inmate shall be as
                    shown on Attachment #10.

                    6.2.1.1       The per them rate per RTC inmate shall be paid
                                  for  200  beds  regardless  of  the  level  of
                                  occupancy.

6.2.1.2      The . amount of per them paid per DUI inmate shall be determined by
             'a sliding scale as shown on Attachment #10 which is based on the @
             average daily population during each billing cycle.

6.2.1.3        There  shall be two billing  cycles  each month.  The first cycle
               shall cover the time period between the first of the month to the
               15th day of that month.  The second  cycle shall be from the 16th
               of the month to the last day of that month.

6.2.2      Per them shall be paid for the day an inmate is received by CSC,  but
           shall NOT be paid for the day an inmate is  released  from the secure
           prison.

6.2.3      The Department receives separate appropriations for the privatization
           of RTC  and  DUI  prison  beds.  Therefore,  during  the  term of the
           Agreement,  separate invoices requesting per them payment for RTC and
           DUI inmates must be submitted within the time frames indicated below.

6.3      Invoices and Records

         6.3.1      Twice each month within two (2) workdays after the end
                    of each billing cycle, CSC shall submit to the




<PAGE>



                    Department separate invoices for payment of per them for RTC
                    and DUI  inmates.  If the  two-day  time  period  falls on a
                    weekend or holiday,  the next workday shall be used. For the
                    purposes of this Agreement, workdays shall be Monday through
                    Friday, 8 a.m. to 5 p.m.

6.3.1.1        CSC shall use the invoice  format  entitled  Per Diem  Invoice as
               shown in Attachment #7 to request payment of per diem.

Original  invoices  submitted  by CSC shall be  legible  and in the  appropriate
format as directed herein, otherwise they shall be returned to CSC to correct or
clarify. In such cases, the Department shall be under no obligation to adhere to
established time frames for payment set forth herein.

6.3.1.2        CSC shall forward the invoices and supporting detail to
               the Department Monitor for verification.

6.3.1.3        The Department Monitor shall verify CSC's invoices and supporting
               detail and forward all  information  to the Deputy  Director,  or
               designee, for payment authorization,  within two (2) working days
               after receipt.

In the event of a discrepancy between the records of CSC and the Department, the
Department  Monitor  shall  notify  CSC of said  discrepancy  immediately  after
verifying  CSC's invoices and supporting  detail.  CSC and the Department  shall
resolve  the  discrepancy  by  comparison  and  reconciliation  of  records.  If
resolution cannot be achieved, the undisputed amount shall be paid. The disputed
amount  shall not be paid until  -mutual  agreement  is reached  relative to the
discrepancy.  The time period for payment of the disputed amount shall be waived
until the dispute is resolved.



6.3.1.4        The Deputy Director. or designee, shall authorize payment
               within fifteen days after receipt and approval of CSC's
               invoices, contingent upon services having been
               satisfactorily provided.  Warrants shall be made payable
               to Correctional Services Corporation and sent to CSC at
               the following- address:



                        Correctional Services Corporation
                              1819 Main, Suite 1000





<PAGE>



                             Sarasota, Florida 34236



6.4      Payment of Inmate Wages for Work Performed in CSC's Prison
         Work Program

         6.4.1      Inmate   wages  shall  be  paid  in   accordance   with  the
                    Department's  written  instructions.  RTC and DUI  wages for
                    prison  work  activities   shall  be  tracked  and  invoiced
                    separately  by CSC in  order to  develop  an  accurate  wage
                    history for each population.



6.4.2      Prison Work Activities

           6.4.2.1     For two years  after CSC's  receipt of the first  inmate,
                       the Department  shall,  via WIPP  appropriation,  pay the
                       cost of wages  earned by inmates  assigned  to the secure
                       prison and  participating in the CSC prison work program.
                       After the first two years,  CSC shall assume  payment for
                       inmate wages.



Prior to the end of the second year of Department  payment of inmate wages,  the
Department and CSC shall negotiate an annual cost for inmate wages, based on the
wage history since CSC's receipt of the first inmate.



CSC shall submit a revised Fee Schedule and Budget  Narrative  forms as provided
by Attachment #12 to reflect the negotiated annual cost for CSC to pay wages for
inmates participating in the prison work program.



The  increase  in RTC and DUI per them  rates  shall be  acknowledged  by formal
written amendment iii accordance with Article IX of this Agreement. The increase
in per diem rates shall be effective two years after the  anniversary  date that
the first  inmates was received by CSC,  but shall not be initiated  until after
the  Amendment is executed.  Any costs  incurred by the  Department  for inmates
wages during the third year after CSC's  receipt of the first  inmate,  shall be
taken as a monthly- credit




<PAGE>



from per them payments to CSC after the amendment is executed and
the per them is adjusted.



Inmates are entitled to have wages earned  posted to their account in accordance
with Department written instructions.



6.4.3      Inmate Work Agreements

           6.4.3.1       Private Sector

                         -   Contract   entity(ies)  shall  pay  for  DUI  labor
                             services at the rate  specified by each inmate work
                             agreement  per inmate hour worked.  Procedures  and
                             time frames  related to payment shall be delineated
                             in each Agreement.



CSC shall  receive  payment  from each  contracting  entity for wages earned for
inmate  labor.  Payments  received  shall be  verified  by CSC.  If CSC  finds a
discrepancy in the amount of payment, CSC shall resolve the discrepancy with the
contracting entity in accordance with the terms of the agreement.



Inmates are entitled to have wages earned  posted to their account in accordance
with the Department's written instructions.



6.4.3.2        Public Sector

               -  In accordance with A.R.S.  31-255, as amended, DUI inmates may
                  keep a portion of wages earned from all work activities, i.e.,
                  labor provided to public entities via inmate work agreements.



An amount equal to  thirty-three  (33 %) percent of each  inmate's wage shall be
deposited in the inmate's spendable account.



Public entities shall pay for DUI labor services at the rate
specified by each agreement per inmate hour worked.  Procedures




<PAGE>



and time frames related to payment shall be delineated in each
agreement.



CSC shall  receive  payment  from public  entities  for wages  earned for inmate
labor. Payments received shall be verified by CSC. If CSC finds a discrepancy in
the amount of payment,  CSC shall resolve the discrepancy with the public entity
in accordance with the terms of the agreement.  If no discrepancy is found,  CSC
shall within ten (10) days after  receipt of payment from a  Contractor,  send a
check equal to the entire amount of the payment to the  Department  made payable
to the "Arizona

Contract No: 6790
Continuation Sheet


Page  42



 . Department of Corrections - Alcohol Abuse Treatment Fund".
Checks shall be sent to:



Department of Corrections
Health Services Business Office
363 North First Avenue, M/C 940
Phoenix, Arizona 85003



CSC shall immediately notify the Department in writing when payments to assigned
inmates  and the AATF will be delayed  due to a  discrepancy  in payment  from a
public entity.



CSC shall provide a payment detail shown by Attachment #6,  entitled Inmate Time
Sheet,  which  shall  accompany  each  check for  deposit  in the Fund.  CSC may
computerize  Attachment  #6, but shall ensure that all required  information  is
provided.



CSC shall provide a copy of the Inmate Time Sheet to the Department Monitor on a
monthly basis.





<PAGE>





6.5     Requirements of A.R.S. 31-201.01

        6.5.1     In accordance with A.R.S. 31-201.01, inmates shall pay
                a fixed fee for health care services received as
                determined by the Department, but not to exceed $5.
                Department written instructions, stipulates the current
                charge inmates shall pay for health care.  CSC shall
                comply with the requirements of the referenced statute
                and written instructions in charging, assigned inmates
                for health services.



6.5.2      By the tenth (10th)  workday each month,  CSC shall send a check made
           payable to the  Department  of  Corrections  Health Care Services for
           monies paid by inmates for health care services  received  during the
           preceding month. CSC shall ensure the Monthly Health Care Fees Report
           provided in Attachment #7  accompanies  each check to reflect  monies
           received and debited as required by the referenced policy.
           Checks shall be sent to:



                            Department of Corrections
                Attn: Administrator, Bureau of Business & Finance
                          1601 West Jefferson, M/C 210
                             Phoenix, Arizona 85007



6.6      Requirements of A.R.S. 31-239, Utility fees

         6.6.1      A.R.S.  31-239,  requires  inmates  who possess at least one
                    major  electrical  appliance to pay a fixed fee of $2.00 per
                    month  for  electricity   usage.  When  Department   written
                    instructions  are  executed,   CSC  shall  comply  with  the
                    requirements  of  the  referenced   statute  and  Department
                    written   instructions  in  charging  assigned  inmates  for
                    electricity usage.

         6.6.2 By the  tenth,(10th)  workday each month,  CSC shall send a check
             made payable to the.  Department of Corrections  for monies paid by
             inmates  for   electricity   usage  incurred  the  previous  month.
             Department  required  reporting forms shall accompany each check to
             reflect monies received and debited. Checks shall be sent to:





<PAGE>





                            Department of Corrections
             Attention: Administrator, Bureau of Business & Finance
                          1601 West Jefferson, M/C 210
                             Phoenix, Arizona 85007



6.7     CSC  shall  invoice  the  Department   quarterly  for  reimbursement  of
        discharge   allowance  paid  to  eligible  inmates  in  accordance  with
        Department written instructions.



6.7.1      Invoices requesting reimbursement shall be submitted by CSC
           to the Department's Contract Monitor by the tenth work day
           of October, January, April and July during the term of the
           Agreement.  Each invoice shall indicate the following,,
           information relative to each inmate who received discharge
           allowance: name of each inmate, Department assigned inmate
           number, amount paid, purpose of payment (clothing,-, or
           transportation) and date of discharge.



6.7.1.1        The Department Monitor shall verify the invoiced  information and
               submit the  invoice  to the  Deputy  Director,  or  designee  for
               authorization of payment.



6.7.2      The Department  shall  reimburse CSC for discharge  allowance  within
           fifteen (15) workdays  after receipt of invoice and  verification  of
           supporting   detail  from  the  Department   Monitor.   Warrants  for
           reimbursement shall be made out to Correctional  Services Corporation
           and shall be sent to CSC at the address shown in Paragraph 6.3.1.4.



6.8      Costs To Be Paid By CSC

         6.8.1    All  costs  incur-red  in the  acquisition,  construction  and
                  maintenance    of   the   secure    prison,    including   the
                  infrastructure, support systems and signage on roadways and at
                  the entrance to the secure prison regarding prison name,
                  warning to public, proper prison identification, etc.
                  All costs related to




<PAGE>



                  tangible personal property attached to or contained
                  within the secure prison. (Refer to Articles
                  III. and V.)



6.8.2      All costs for  remediation  and/or  correction  to modify  the secure
           prison in order to comply with Department requirements and applicable
           laws, rules, standards, codes and guidelines as specified in Articles
           III and V.



6.8.3      All costs involved in the acquisition of an appropriately
           executed performance bond. (Refer to Article VIII.) -

Contract No: 6790
Continuation Sheet



Page 44



6.8.4'  All  costs  for  personnel  necessary  to staff  the  secure  prison  in
accordance with the requirements of this Agreement.
(Refer to Article IV.)



6.8.5      All costs for housing inmates in accordance with the
           requirements of this Agreement. (Refer to Article V.)



6.8.6      All costs to  deliver  services  to the  assigned  inmate  population
           (Refer to Article V and the Service Specifications).



6.8.7      All costs relative to licensure as a security agency and
           registration of staff as security officers. (Refer to
           Article IV.)



6.8.8      The cost for fingerprinting non-security positions, to
           include potential employees, volunteers, subcontractors,




<PAGE>



           independent   contractors   and   the   employees   and   agents   of
           subcontractors  and  independent  contractors  who  will  work at the
           secure prison. (Refer to Article IV.)



6.8.9      All costs to duplicate or obtain Department forms used in
           special purpose records.



6.8.     1 0 Department charges, as invoiced monthly, for the
         following: (Refer to Article
           IV.)



6.8.10.1          ACIC/NCIC background investigations for CSC's staff at
               $4 per investigation.

6.8.10.2          Processing fingerprint cards for CSC's non-security
               staff at $8 per card.

6.8.10.3       In accordance with paragraphs 6.8.10.1 and 6.8.10.2,  a charge of
               $12  per  individual  for the  Department  to  conduct  ACIC/NCIC
               background investigations and process fingerprint cards for CSC's
               staff.

6.8.10.4          Costs relative to CSC's inmate banking activities,
               e.g., checks and banking supplies, etc.

6.8.10.5       CSC shall pay the charges by the tenth (10th)  workday each month
               by check made payable to the Department of  Corrections  and sent
               to:

                            Department of Corrections
                          Attn: Business Administrator
                                Prison Operations
                               1601 West Jefferson
                             Phoenix, Arizona 85007

         6.8. 1 l-'          All costs to provide three (3) personal
           computers with emulations cards to allow access to AIMS and
           one dedicated printer, one check protector and one radio
           tuned to the frequency of the secure prison.







<PAGE>



           6.8.12 All costs  associated with  increasing  availability of health
           providers  if waiting  times are  determined  to be  excessive by the
           Deputy Director, Health Services.
           (Refer to Article IV.)



           6.8.13 All costs associated with  rebuilding,  restoring or repairing
           the secure  prison,  including  costs to move  assigned  inmates,  if
           applicable,  in the event of damage to or  destruction  of the secure
           prison caused by disturbances, fire or acts of nature during the term
           of this Agreement.
           (Refer to Article V.)



           6.8.14 All costs  required to correct any  potential or real security
           risk in the secure prison  structure or secure  perimeter.  (Refer to
           Article V.)



           6.8.15          Two years after receipt of the first inmate, costs
           for wages earned by inmates' participation in the CSC
           prison work program. (Refer to Article VI)



           6.8.16          Costs for Department provision of staff training
           requested by CSC in excess of required levels relative to
           Specialty Training Topics. (Refer to Article IV)



           6.8.17 All costs for  emergency,  public safety or security  services
           provided  to CSC by the  State or any  political  subdivision  of the
           State.



6.8.18     Costs for DUI and RTC inmate  medical  care  except as  described  in
           paragraphs 5.15.6, 6.9.1 and 6.9.2.



           6.8.19  Negotiated  costs  related  to the  connection  of the secure
           prison to the Town of Florence sewer system (Refer to Article V).






<PAGE>




           6.8.20          Any other costs indicated in this Agreement as a
           cost applicable to CSC but not listed here.



6.9     Costs To Be Paid By The Department

        6.9.1   High  (catastrophic)  health  costs  for  inmates  for a  single
                diagnosis  that exceeds  $10,000 per inmate per  contract  year.
                (Refer to Article V.)



           6.9.2 Health Costs for  hospitalization of RTC inmates admitted after
           emergency  medical  treatment  and medical costs for RTC inmates with
           chronic conditions  requiring regular  examinations and/or treatment.
           For the  purpose of this  Agreement,  the  following  conditions  are
           considered  chronic:  Cancer,  Insulin  Dependent  Diabetes,  Seizure
           Disorders,   Heart  Disease,   Respiratory   Disease,   Tuberculosis,
           HIV/AIDS,   Serious   Mental   Illness   (as   defined   by   written
           instructions).  The inmate's health  condition shall be determined by
           the Department's Health Services staff.

Contract No: 6790
Continuation Sheet



Page 46



6.9.3



Inmate wage reimbursement, as invoiced by CSC, for two years after-CSC's receipt
of the first inmate.



           6.9.4           Discharge allowance reimbursement, as invoiced by
           CSC and approved by the Department.







<PAGE>



           6.9.5  Negotiated costs related to connection of the secure prison to
           the Town of Florence sewer system (Refer to Article V).



6.10     A.R.S. 41-1609.01 D

         6.10.1       ANNUAL price or cost adjustments  authorized in accordance
                      with  Article IX shall be paid in the form of an increased
                      per them rate as specified by each executed amendment.



6.11     A.R.S. 41-1609.01 E

         6.11.1
                           CostorpriceadjustmentsauthorizedinaccordancewithAr
                      ticleIXshallbepaid  in the form of an  increased  per them
                      rate as specified by each executed amendment.



6.12     Financial Reports

         6.12.1            In accordance with A.R.S. 41-1609 M.l., CSC shall
                    provide audited and unaudited financial statements to
                    the Department.  Audited financial statements shall be
                    due on or before March 31 annually.  The unaudited
                    financial statements shall be provided on a quarterly
                    basis beginning on or before March 31.  Audited
                    statements shall include, at a minimum, income
                    statements and balance sheets for the previous
                    calendar year.  Unaudited statements shall include, at
                    a minimum, income statements and balance sheets for
                    the previous quarter.



6.12.2     The Department shall have the right to request  additional  financial
           data in order to obtain information deemed necessary.



6.12.3     CSC shall provide two (2) copies of the audited financial  statements
           to the  Department  Monitor.  The Monitor  shall forward one complete
           copy each to the Deputy  Director  and the  Administrator,  Bureau of
           Business and Finance.




<PAGE>






                                   ARTICLE VII
                   CONTRACT MONITORING/PERFORMANCE EVALUATION



7.1     The Department shall monitor CSC's performance to ensure compliance with
        all contract provisions and applicable  Department written instructions,
        Administrative  Rules,  guidelines,  specifications,  Court  Orders  and
        Decrees as each are addressed within the Department's  system of written
        instructions.



7.1.1      CSC shall, via its assigned Prison Warden, ensure routine
           monitoring of service delivered, to include monitoring of
           subcontracted services.  Such monitoring

Contract No: 6790
Continuation Sheet
Page' 47



activities  shall  include   documenting   noted   deficiencies  and  requesting
corrective  action to  ensure  that at least the  minimum  service  requirements
specified by this Agreement are met.



7.1.2      The Department shall conduct inspections in accordance with
           Department written instructions.



7.1.3      The Department shall establish a Health Advisory Committee  comprised
           of a Facility Health Administrator (FHA), a health provider, a dental
           provider,  a nurse,  a mental health  provider and a medical  records
           representative.  CSC expressly  acknowledges  that this activity does
           not relieve CSC of the responsibility for the delivery of health care
           to assigned inmates. The Committee shall at least:



7.1.3.1        Review documented justification for CSC's referrals for
               outside medical consultations.




<PAGE>




7.1.3.2        Review staffing patterns relating to patient waiting
               times to be seen by health providers/dentists.



           7.1.3.3       Make recommendations requiring changes, as appropriate.

7.1.4      Monitoring  activities  shall be conducted with timely notice to CSC.
           The secure prison's program operation,  as well as records related to
           this Agreement may be included in monitoring activities.



7.1.4.1        Guidelines detailing criteria and scope of monitoring  activities
               shall be provided to CSC prior to delivery of the first inmate to
               the secure prison and subsequently as changes occur.



7.1.4.2        The Department shall, subject to limitations provided by
               law with respect to rights of privacy, have the right to
               reasonably prompt access to examine and receive copies,
               if requested, of all records of CSC related to the secure
               prison, including without limitation, all financial books
               and records, maintenance records, employee records, and
               inmate records generated by CSC and its subcontractors or
               independent contractors, in connection with the
               performance of this Agreement.



7.1.5      The results of monitoring/inspecting activities conducted
           by the Department shall be made known to CSC in writing by
           the Department's Monitor.  If noncompliance issues are
           noted during a monitoring activity,, each shall be
           specifically identified and corrective action shall be
           recommended with a time frame specified to achieve
           compliance.  CSC shall be required to . respond within the
           specified time frame or indicate in writing to the
           Department's Contract Monitor why compliance cannot be
           achieved within the specified time frame and offer an
           alternative to meet the -objective.

7.2      The  Department  shall  assign  up to four  staff  members  to  monitor
         contract  services  on a  daily  basis  and  coordinate  all  necessary
         activities relevant to CSC and Department




<PAGE>



         responsibilities.   Department   contract  monitoring  staff  shall  be
         physically  located at the  secure  prison on a full time  basis.  Each
         staff member shall be provided  with  approximately  144 square feet of
         work space.



7.3      Twelve (12) months after CSC's receipt of the first inmates,
         the Department shall begin to gather information related to
         the performance of the secure prison as required by A.R.S.
         41-1609.01 K. and L.  The information shall be used for a
         comparative analysis of the secure prison to level II units
         within the Department.  The comparison shall include at
         least the following analytical factors:



7.3.1      The nature of the inmates in the facilities.

7.3.2      Whether the facilities meet professional standards.

7.3.3      The level of training provided to the staff and the level
           of training accomplished by the staff.



7.3.4      The number and nature of complaints against the staff.

7.3.5      The number and nature of violent or other disruptive
           incidents among inmates or against staff.



7.3.6      The number of escapes and attempted escapes.

7.3.7      The number and nature of disciplinary actions against
           inmates and staff.

7.3.8      The number of inmates productively active, the level of
           productivity and the nature of the activity provided to
           inmates.



7.3.9      The rate at which inmates complete programs successfully.

7.3. 10 Other matters related to the quality of services
provided.






<PAGE>




                                  ARTICLE VIII
                   PERFORMANCE BOND/INSURANCE/INDEMNIFICATION



Performance Bond

8.1      CSC shall  provide a  Performance  Bond for the term of this  Agreement
         based on the  projected  annual per them cost  calculated  as indicated
         below.



8.1.1      Prior to  execution  of this  Agreement  (see  Article  II) and until
           receipt of the first inmate,  CSC shall  provide a  Performance  Bond
           equal to 10% of the projected annual per them cost  ($731,095).  Upon
           receipt of the first inmate,  the value of the Performance Bond shall
           be  increased  to  100%  of  the  projected   annual  per  them  cost
           ($7,310,950).



8.1.2      Thereafter,  no later than the  anniversary  of the date of Agreement
           execution,  the  Performance  Bond  shall  be  adjusted  annually  in
           accordance  with  Paragraph  8.1.5.  Failure  of CSC to  provide  the
           initial Performance Bond shall result in

Contract No: 6790
Continuation Sheet
Page -49



default and  termination of this Agreement.  Subsequent  failure by CSC -to post
the Bond  equal  to  subsequent  yearly  per  them  costs  by no later  than the
anniversary  of the date of  Agreement  execution,  may  result in  default  and
termination of the Agreement.



 .          8.1.3 The Performance  Bond shall be of a standard  commercial  scope
           and shall be issued by a surety company authorized by the Director of
           the Arizona  Department of Insurance pursuant to Title 20, Chapter 2,
           Article 1 to transact business in Arizona.






<PAGE>




8.1.4      The  Performance  Bond shall be in a form acceptable to the State and
           shall be payable to the Department of  Corrections,  an agency of the
           State of Arizona.



8.1.5      To  calculate  the annual per them cost for the  initial  twelve (12)
           month  term of the  Agreement,  i.e.,  from  the  date  of  Agreement
           execution  until the  anniversary  of the date of execution,  the per
           them rates of $35.40 per day for 400 DUI  inmates  and $29.35 per day
           for 200 RTC inmates for 365 days shall be used.



8.1.5.1        Subsequent  calculations  for the  annual  per them cost shall be
               based on the Department's  then current per them rate for 400 DUI
               and 200 RTC inmates for 365 days.



8.1.6      The  proceeds  from the bond shall be used to pay:  (i) excess  costs
           incurred by the Department to reprocure services if the secure prison
           is not constructed  within the time frames specified  herein; or (ii)
           Department  expenses to  reprocure  services  or to relocate  inmates
           assigned to the secure prison if this  Agreement is terminated due to
           an Event of Default by CSC.



Insurance

8.2      In accordance with A.R.S.  41-1609.01 M.2., CSC shall provide a plan of
         insurance  as required by this  Agreement  and  approved by the State's
         Department of Administration, Risk Management Unit (Risk Management).



8.2.1      Without limiting any liabilities or any other obligations of CSC, CSC
           shall  provide and maintain and cause its  subcontractors  to provide
           and maintain insurance coverage with forms and insurers acceptable to
           the State, until all obligations under this Agreement are satisfied.







<PAGE>



           8.2.2 Unless  otherwise  stated  herein the  policies  shall name the
           State of Arizona and the  Department  of  Corrections  as  additional
           insured as required by the General  Provisions  and  Attachment #8 of
           this  Agreement.  The  policies  shall  specify  that  the  insurance
           afforded  CSC  shall be  primary  insurance  and  that-any  insurance
           coverage  carried by the State, the Department or its employees shall
           be  excess  coverage,  except  as  provided  by  State  law,  and not
           contributory insurance to that provided by the State/Department.

Contract No: 6790
Continuation Sheet



Page -50



8.2.3 '           Failure on the part of CSC during the term of this
             Agreement to acquire and maintain the liability and
             property insurance and fidelity bond required by
             Attachment #8, and provide proof thereof to the Department
             within thirty (30) days following the commencement of a
             new policy period, shall constitute a material breach of
             this Agreement upon which the Department may immediately
             terminate this Agreement.



8.2.4      Required  insurance  coverage as shown on  Attachment  #8 shall be in
           effect on the date of  execution of this  Agreement.  Within five (5)
           days after execution of this Agreement, CSC shall, in order to verify
           required  coverages,  provide certified copies of insurance  policies
           and  endorsements  to  Risk  Management  and  appropriately  executed
           certificates of insurance to the Department.



8.2.4.1           CSC shall ensure that the subcontractor authorized by
             Attachment #3 acquires and maintains Workers' Compensation
             insurance as well as professional liability insurance
             coverage as each coverage is required by Attachment #8.
             CSC shall ensure that appropriately executed certificates
             of insurance and certified copies of insurance policies
             for the subcontractor are provided to the Department and
             Risk Management as directed by Paragraph 8.2.4 above.





<PAGE>





8.2.4.2      Final  approval  by Risk  Management  of CSC's  insurance  plan (to
             include  coverages  required  for  the   subcontractor)   shall  be
             contingent  on  acceptance  of the  submitted  certified  insurance
             policies.



8.2.4.3      If, during the term of this  Agreement,  other  subcontractors  are
             authorized  to provide  services,  CSC shall  ensure that  required
             coverages, certificates and policies are provided to the Department
             and Risk Management as specified above. Approval by Risk Management
             is required  relative to insurance  coverages for any subcontractor
             prior to provision of any service by the subcontractor(s).



8.2.5      CSC shall ensure that the CSC architect/engineer and
           construction contractor provide at least those coverages
           specified below relative to their respective operations and
           activities.  Certificates of insurance for each required
           policy shall reflect that CSC and the Department of
           Corrections are certificate holders and that each are
           additional insureds on each policy, except Workers'
           Compensation.  Copies of appropriately executed
           Certificates of Insurance shall be provided to the
           Department within five days after execution of this
           Agreement.



8.2.5.1        Workers'  Compensation  insurance to cover obligations imposed by
               Federal  and  State  statutes  having   jurisdiction  over  their
               employees   engaged  in  the  performance  of  the  services  and
               Employer's  Liability  insurance  with  a  minimum  limit  of one
               hundred thousand dollars ($100,000).



8.2.5.2        Commercial general liability insurance with a minimum
               combined single limit of one million dollars ($1,000,000)
               each occurrence.  The policy shall include coverage for
               bodily injury, personal injury,

Contract No: 6790
Continuation Sheet
Page 51






<PAGE>




broad form property damage,  blanket contractual,  contractor's , protective and
products and completed operations.



8.2.5.3        Comprehensive  automobile  liability  insurance  with a  combined
               single limit for bodily  injury and  property  damage of not less
               than  one  million  dollars  ($1,000,000)  each  occurrence  with
               respect to CSC's  vehicles  (whether  owned,  hired,  non-owned),
               assigned to or utilized in the performance of this Agreement.



8.2.5.4        Professional liability insurance with limits of one
               million dollars ($1,000,000) each claim.



Indemnification

8.3      The Department shall remain solely responsible for all
         litigation, losses and costs that
         are:     (i) unrelated to the operations of the secure prison; and
         (ii) the result of claims or litigation pending against the
         Department at the time this Agreement is executed, or arising
         thereafter from occurrences that took place prior to the
         execution date of this Agreement.  Nothing contained in this
         paragraph shall in any way abrogate, modify or mitigate any
         obligation of CSC under this Agreement to comply with Court
         Orders/Decrees or other requirements imposed on CSC by the terms
         of this Agreement.



8.4     CSC shall defend, indemnify and hold harmless the Department
        and the State of Arizona from any claim, demand, suit,
        liability, judgment and expense including attorney's fees and
        other costs of litigation) arising- out of or relating to
        injury, disease, or death of persons or violation of civil
        rights, or damage to or loss of property resulting from or in
        connection with the negligent performance of this Agreement
        by CSC, its agents, employees, and subcontractors or any one
        for whom CSC may be responsible.  The obligations,
        indemnities and liabilities assumed by CSC under this
        paragraph shall not extend to any liability caused by the
        negligence of the State or its employees or the Department
        and its employees.  CSC's liability shall not be limited by
        any provisions or limits of insurance set forth in this




<PAGE>



        Agreement.  The State shall reasonably notify CSC of any
        claim for which it may be liable under this paragraph.



8.5     Neither the Department nor CSC shall waive, release, or
        otherwise forfeit any possible defense the Department or CSC
        may have without the consent of the other party relative to
        claims arising from or made in connection with the operation
        of the secure prison by CSC.  The Department and CSC shall
        preserve all such available defenses and cooperate with each
        other to make such defenses available for each other's
        benefit to the maximum extent allowed by law.



8.6     CSC shall defend, indemnify and hold harmless the State and
        the Department against any liability, including costs and
        expenses, for infringement of any patent,. trademark or
        copyright arising from the performance of this Agreement, or
        for the use by the State or the Department of materials
        furnished or work performed under this Agreement.  The State
        or the Department shall reasonably notify CSC of any claim
        for which it may be liable under this paragraph.

8.7      Except as required by;A.R.S  41-1609.02 M.2., pertaining to
         Contractor adequately providing a plan of insurance,
         specifically including coverage or insurance for civil
         rights claims and liabilities, CSC shall have no obligation
         to insure, defend, indemnify or hold harmless the Department
         or the State of Arizona from any claim, demand, suit,
         liability, judgment or expense (including,, attorney fees
         and other costs of litigation) arising out of or relating to
         any Department Order, Court Order, Administrative Rule,
         Federal or State requirement of law, which governs CSC
         relative to the custody and supervision of inmates, and are
         hereinafter referred to as Imposed Requirements. The State
         of Arizona and the Department shall defend, indemnify and
         save harmless CSC from any claims, demands, suit, liability,
         judgment or expense (including, attorney fees and other
         costs of litigation) arising out of or relating to such
         Imposed Requirements.  This paragraph shall not obligate the
         State of Arizona or the Department to defend, indemnify or
         save harmless CSC from: (i) any negligence described in
         paragraph 8.4 above; (ii) its conduct in performing this
         Agreement apart from Imposed Requirements; or (iii)
         liability claims of third parties arising- from the
         Department's participation in the hiring and the staff
         training process set forth in Article IV herein.





<PAGE>





8.8      CSC shall protect, defend, indemnify and hold harmless the
         Department from and against all liabilities, costs, charges
         and expenses, including attorneys' fees and court costs and
         other costs arising out of, or related to, the presence of,
         or existence of any substance regulated under any applicable
         federal, state or local environmental laws, regulations or
         ordinances or amendments thereto because of: (i) any
         substance that came to be located in or on the premises on
         which the secure prison is located resulting from any use or
         occupancy of the lands by CSC before or after the issuance
         of the Agreement; or (ii) any release, threatened release,
         escape, substance in, on, under, or from said premises in or
         on which the secure prison is located that is caused, in
         whole or in part, by any conduct, actions or negligence of
         CSC, regardless of when such substance came to be located in
         or on the premises where the secure prison is located.



8.8.1             For the purposes of this Agreement, the term "regulated
         substance" shall include substances defined as "regulated
         substances," "hazardous waste," "hazardous substances,"
         "hazardous materials," "toxic substance" or "pesticides" in
         the Resource Conservation and Recovery Act, as amended by
         the Hazardous and Solid Waste Amendments of 1984, the
         Comprehensive Environmental Response, Compensation and
         Liability Act, the Hazardous Materials Transportation Act,
         the Toxic Substance Control Act, the Federal Insecticide,
         Fungicide and Rodenticide Act, the relevant local and state
         environmental laws, and the regulations, rules and
         ordinances adopted and publications promulgated pursuant to
         the local, state and federal laws.  This indemnification
         shall include, without limitation, claims or damages arising
         out of any violations of applicable environmental laws,
         regulations, ordinances or subdivisions thereof, regardless
         of any real or alleged strict liability on the part of CSC.
         This environmental indemnity shall not be limited by the
         limits of any insurance policy held by or for the benefit of
         CSC.  The environmental indemnity shall survive the
         expiration or termination of this Agreement and/or any
         transfer of all or any portion of the premises in or on
         which the secure prison is located and shall be governed by
         the laws of the State of Arizona.

8.8.2      In the event any such action or claim is brought or
           asserted against CSC, the Department shall have the right,
           subject to the right of CSC, to participate with CSC as
           follows: (i) in making all final decisions with respect to




<PAGE>



           CSC's  liability  for claims or damages,  (ii) in  conducting  of any
           further  required   cleanup,   removal  or  remedial  actions  and/or
           negotiation  and  defense  of  any  claim  indemnifiable  under  this
           environmental indemnity provision,
           having   reasonable   regard  to  the   continuing   conduct  of  the
           operation/business  of  the  secure  prison  located  in  and  on the
           premises and (iii) in  negotiating  and  finalizing  any agreement or
           settlement with respect to any such claim or cleanup.



8.9      Neither CSC nor its insurer(s) may plead the defense of
         sovereign immunity in any action arising out of the
         performance of this Agreement.



                                   ARTICLE IX
                             NOTICES AND AMENDMENTS



Notices

9.1      Any and all notices, requests or demands, including those
         relative to default and termination, given or made upon the
         par-ties hereto pursuant to or in connection with this
         Agreement, unless otherwise noted, shall be delivered in
         person or sent by United States Mail, postage prepaid to the
         par-ties at their respective addresses as indicated on the
         signature page of this document as well as to the Department
         Monitor located at the secure prison and to the Department's
         Contracts Administration Office at the address shown below.

                            Department of Corrections
                     Attention: Contracts Administrator 1645
                            West Jefferson, M/C 802,
                             Phoenix, Arizona 85007



9.2      Changes to the Agreement to accomplish  the following may be handled by
         written notice rather than formal amendment. All other changes shall be
         accomplished by formal amendment, signed by all parties and reviewed by
         the JLBC (see paragraph 9.3).

         Notices regarding the below listed change actions shall, in addition to
         the signatories indicated on the signature page




<PAGE>



         of this Agreement, be sent to the Department Monitor and the
         Department's Contracts Administration Office as indicated
         above.



9.2.1      Chance of address of CSC or the Department.

9.2.2      Change of CSC or Department authorized signatory, or
           designee. (Unless such change impacts respective
           obligations under this Agreement.)



9.2.3      Change in the name or address of the person(s) to whom
           notices are to be sent.

9.2.4      Changes in the name or address where invoices are to be
           sent. .'

9.2.5      Changes to Attachments to this Agreement as long as a change does not
           require a price or cost  increase  or impact  obligations  under this
           Agreement.

Contract No: 6790
Continuation Sheet
Page 54



Amendments

9.3      All amendments to this Agreement shall be prepared,
         finalized and maintained by the Department's Contracts
         Administration Office.  All amendments shall be reviewed by
         the JLBC in accordance with A.R.S. 41-1609.01 A.



9.3.1      Amendments regarding ANNUAL cost or price increases that
           are approved by the Department and funded by the
           Legislature in accordance with A.R.S. 41-
           1609.01 E. shall be effective on the anniversary date of
           this Agreement, i.e.,
           the anniversary of the date CSC received the first
           Department inmate.







<PAGE>



           9.3.2  Amendments  regarding  issues  OTHER than annual cost or price
           increases shall be effective when all signatures are affixed, or on a
           later date as specified in each amendment.



9.3.3      The Department shall not entertain requests from CSC
           regarding amendments for cost increases due to construction
           related activities as such activities are
           identified herein as the responsibility of CSC.  During-
           the term of this Agreement, to include the period of
           renewal, CSC shall not submit a request for a per them
           increase for construction related expenses unless the
           Department identifies requirements beyond those identified
           in RFP 6702 and shown on the plans, specifications and
           final blueprints prepared by the CSC architect.



9.3.4      One original of each executed  amendment  shall be provided to CSC by
           the  Department's  Contracts  Administration  Office  within ten (10)
           workdays after execution.



9.4     Each request from CSC to amend this Agreement shall be
        submitted in writing to the Deputy Director, or designee with
        a copy to the Contracts Administration Office.  Written
        documentation describing the reason for an amendment shall
        accompany each request.  Requests for modifications or
        changes relative to increases in CSC's operating or
        management costs shall be accompanied by completed Fee
        Schedule and Budget Narrative Forms as provided by Attachment
        #12 to justify such requests.



9.4.1    The Department  shall have the right to request and receive  additional
         information,  statistics,  etc.  and to direct  the  content,  form and
         format of the additional  information as it deems necessary to validate
         CSC's request for an amendment.



9.4.1.1        If,   after  two  (2)   consecutive   requests   for   additional
               documentation  relative  to a requested  amendment  the same cost
               adjustment,  CSC fails to provide the content, form, or format as
               requested by the Department,  the request for a cost increase may
               be denied.




<PAGE>




9.4.1.2        Failure by CSC to provide all required or  requested  information
               in a timely manner, thereby delaying Department action beyond the
               upcoming  anniversary  date, shall nullify the amendment  request
               for the new annual period.

9.4.1.3         If  CSC's  request  is  found  to be  justified,  Department
                caused-delays  ,  shall  not  nullify  approving  action  by the
                Department  after the  anniversary  date.  The parameters of the
                executed amendment shall be retroactive to the anniversary date.



9.5     In  accordance   with  A.R.S.   41-1609.01  D.,  annual  price  or  cost
        adjustments may be provided to CSC, except that an adjustment (increase)
        may be made only once each year effective on the anniversary date of the
        Agreement.



9.5.1      CSC must submit a request for an annual price or cost increase to the
           Department  Monitor at least six (6) months prior to the  anniversary
           date of this  Agreement.  Requests must be  accompanied by supporting
           information as indicated in Paragraph 9.4 et. seq.



9.5.2      If an annual cost or price increase is authorized, it shall
           be paid to CSC in the form of a revised per them rate to be
           paid per inmate.  The amount of the adjustment shall not
           exceed the percent of change in the average consumer price
           index (CPI) established for the most recent calendar year
           as published by the United States Department of Labor,
           Bureau of Labor Statistics, not to exceed the Department's
           then current per them rate.



9.5.2.1        The "base" upon which  increases will be calculated  shall be the
               total  amount paid in per them by the  Department  to CSC for RTC
               and DUI inmates during the last previous contract year.





<PAGE>





A contract year is twelve (12) months in length.

The  first  contract  year  shall  begin  on the  date CSC  receives  the  first
Department  inmate  and shall  continue  for the next  twelve  months  until the
anniversary of the date the first  Department  inmate was assigned to the secure
prison.  The anniversary  date shall mark the beginning of each ensuing contract
year.



9.5.2.2        The base shall be  multiplied  by a percentage  not to exceed the
               CPI specified above. The resulting product shall be calculated to
               reflect a new daily  rate  based on 400 DUI and 200 RTC  inmates.
               Attachment #10 shall be revised to reflect new per them rates.



9.5.3      Annual cost or price adjustments (increases) approved by the Director
           and Deputy  Director,  shall be acknowledged  by formal  amendment to
           this Agreement in the manner set forth in this Article.



9.6 Subsequent to execution of this  Agreement  (See Article II),  circumstances
may dictate that CSC bear additional  costs relative to operation and management
services  in order to be in  compliance  with new Court  Orders/Decrees  or laws
applicable to the Department or with newly issued written instructions. Requests
from  CSC  for  modifications  or  changes  which  address  the  impact  of such
additional   costs  shall  be  received  within  sixty  (60)  days  after  CSC's
implementation  of the new requirement.  The Department's  then current per them
rate shall not be exceeded when requesting per them increases, due to additional
costs.



9.6.1             Requests from CSC must be accompanied by supporting-
         information as indicated in Paragraph 9.4 et seq.



        9.6.2     In accordance with A.R.S. 41-1609.01 E., Department
         supported cost or price increases shall be promptly
         presented to the JLBC for review.  The Department shall use
         its best efforts to support each cost or price increase.
         The Department may support CSC's request for retroactive




<PAGE>



         payment  depending  upon the individual  circumstances  related to each
         request for cost increase.



9.6.2.1        Any  cost or  price  increase  shall be  acknowledged  by  formal
               amendment  to this  Agreement  in the  manner  set  forth in this
               Article.



9.7     While the Contractor has the right to request  increases as described in
        Paragraphs 9.5 and 9.6, any increase is contingent upon  availability of
        appropriated dollars.



                                    ARTICLE X
                                     DEFAULT


10.1     Each of the following may constitute an Event of Default
         (Default) on the part of CSC.

                    10. 1. 1 A material failure to keep, observe,  perform, meet
                    or comply with any covenant, agreement, term or provision of
                    this Agreement  when such failure  continues for a period of
                    twenty (20) days, unless otherwise stated herein,  after CSC
                    has received written notice thereof.



           10.    1.2 Failure to observe, perform, meet, or comply with
           any covenant, agreement, term, or provision requiring an
           action within a specified time frame.



10.1.3     A material failure to meet or comply with any Court Order, Federal or
           State requirement or law, Administrative Rule, Department Order, etc.
           for  which  CSC has not  received  a prior  written  waiver  from the
           Department  when such failure  continues  for a period of twenty (20)
           days after CSC has received written notice thereof.







<PAGE>



               10.1.3.1  A failure to provide a facility that is in full
               compliance with Americans with Disabilities Act
               Accessibility Guidelines (ADAAG).



           10.    1.4 A failure to maintain the secure prison and related
           infrastructure and support systems in compliance with all
           Federal and State codes, rules and regulations.



10.1.4.1       CSC  shall   immediately   provide  copies  of  notices  received
               regarding violations of Federal,  State or local codes, rules and
               regulations  relative to building,  fire,  health or safety codes
               and ADAAG.  Copies of all notices shall be provided in accordance
               with Article IX, Paragraph 9.1.

                  Violations  as described in 10.1.4.1 that affect the immediate
health or safety of staff or assigned inmates, e.g., food preparation,  water or
sewer contamination, gas leak, etc., shall be rectified, at least on a temporary
basis,  within  two (2)  hours  after  CSC  becomes  aware of the  violation  or
deficiency.  CSC  shall  provide  verbal  notice  of  the  violation(s)  to  the
Department's  Contract  Monitor  immediately  and  provide  copies  of  relevant
Significant Incident Reports (SIRs).



         Within four (4) hours after becoming aware of a violation or deficiency
that affects the immediate  health or safety of staff or assigned  inmates,  CSC
shall provide an  information  report to the  Department  Monitor  describing at
least the nature and scope of the problem,  proposed plan to cure the problem to
include the anticipated time frame to complete remedial action.



The  Department  shall,  within two (2) hours after  receipt of the  information
report,  advise  CSC of  acceptance  or  rejection  of the plan and  whether  an
Event(s) of Default will be declared in accordance with Article X based on facts
presented.



Violations or deficiencies of codes, rules and regulations as
described in 10. 1. 4. 1 that do not pose an immediate threat to the
life and safety of the staff or assigned inmates shall be corrected
within twenty (20) days after the violation or deficiency becomes




<PAGE>



known to CSC.  Failure to comply may result in an Event(s) of Default
being declared in accordance with Article X.



10.     1. 5 Written admission by CSC of its inability to:

           10.1.5.1        Pay its debts.

           10.1.5.2   Make a general assignment for the benefit of
           creditors.



10.1.5.3       Suffer a decree or order  appointing a receiver or trustee for it
               or  substantially  all of its  property  to be  entered  and,  if
               entered  without  its  consent,  not to be stayed  or  discharged
               within sixty (60) days.

10.1.5.4       Suffer   proceedings   under  any  law  relating  to  bankruptcy,
               insolvency,  or the  reorganization  or relief of  debtors  to be
               instituted  by or against it and, if  contested  by it, not to be
               dismissed or stayed within sixty (60) days.

10.1.5.5       Suffer any judgment,  writ of  attachment  or  execution,  or any
               similar process to be issued or levied against a substantial part
               of its property which is not released,  stayed, bonded or vacated
               within sixty (60) days after.
               issue or levy.

10. 1. 6       The discovery by the Department that any statement,
               representation or warranty made by CSC is false, misleading or
               erroneous in any material respect.



           10.    1.7 Failure by CSC to maintain any performance bond or
           insurance required by this Agreement.



10.2     If a Default as outlined in Paragraphs 1 0. 1. 1 through 10.
         1. 7 occurs and CSC reasonably believes that such Default
         cannot be cured within the specified twenty (20) day time
         period, but does believe that through diligent, ongoing and
         conscientious effort, the Default can be cured within a
         reasonable time period not to exceed six (6) months, CSC
         may, within the twenty (20) day time period, submit a plan
         for curing the Default to the Deputy Director, or designee.




<PAGE>



         CSC's  submitted plan shall indicate in detail how CSC proposes to cure
         the Default.



10.2.1       Upon  receipt  of any  such  plan  submitted  by  CSC,  the  Deputy
             Director,  or  designee,  shall,  within  five (5)  workdays  after
             receipt,  review the plan and determine whether to accept or reject
             the submitted plan to cure.



10.2.2     The Deputy Director, or designee, shall provide written notice to CSC
           if the  plan is  accepted.  The  Department  agrees  that it will not
           exercise its remedies  hereunder  with respect to a declared  Default
           for so  long as CSC  diligently,  conscientiously  and  in' a  timely
           manner undertakes to cure the Default in accordance with the approved
           plan.



10.2.3     The Deputy Director, or designee, shall provide written notice to CSC
           if the plan is rejected.  During the period of time CSC's  request is
           pending before the Deputy  Director,  the twenty (20) day cure period
           shall not be suspended, nor shall the Department's legal or equitable
           remedies be affected or waived.



10.3     Upon an occurrence of Default by CSC, the Department shall, in its sole
         discretion,  have the right to pursue  any remedy it may have at law or
         in equity, including, but not limited to:



10.3.1            Reducing its claim to a judgment.

10.3.2     Taking action to cure the Default,  in which case the  Department may
           offset costs  incurred to cure the Default  against any payments owed
           to CSC. This action shall not preclude the Department's right to file
           a claim under the Performance Bond for reimbursement of damages.



10.3.3            Assessing liquidated damages.





<PAGE>



                         10.3.3.1 For each  calendar day that any Default by CSC
                         continues  after  the  last day of the  specified  cure
                         period,  the sum of $500 per day may be  deducted  from
                         funds payable to CSC under this Agreement as liquidated
                         damages until such Event(s) of Default is cured or this
                         Agreement is terminated, whichever occurs first, not as
                         a penalty  but as  damages  for the  Department's  cost
                         resulting from the default..

                  l0.3.3.2  Assessment of liquidated  damages shall preclude the
             following  Department actions:  (i) deduction of any costs incurred
             pursuant to . Paragraph 10.3.1 from amounts  otherwise due CSC; and
             (ii)  assertion  of  claims  for  actual  damages  alleged  to have
             resulted from such Event(s) of Default,  but shall not preclude the
             Department from pursuing action relative to the Performance Bond.



         10.3.4            Terminating the Agreement and removing the inmates
                    from the secure prison.

10.4     Each of the following shall constitute a Default on the part
         of the Department.

         10.4.1
                           AfterappropriationoffundsbytheState,failurebytheDe
                      partmenttopayCSC  within the time frames stated in Article
                      VI,  unless  the  failure  to  pay  is  a  result  of  the
                      following.



10.4.1.1       Off-setting any damages,  including liquidated damages,  assessed
               by the Department against CSC in accordance with this Agreement.



           10.4.1.2        Disputed per them charges as authorized by Article
                         VI.

10.4.2            Failure by the Department to observe and perform any
           material covenant, condition or agreement to be observed or
           performed on its part, or its failure or refusal to
           substantially fulfill any of its material obligations
           hereunder and such failure continues after receipt of
           notice from CSC and after the cure period specified by CSC
           (which shall not be less than twenty [20] days) has ended,
           unless such failure is caused by the Default of CSC.




<PAGE>






10.5     If a Default as outlined in Paragraph 10.4.2 occurs and the
         Department reasonably believes that such Default cannot be
         cured within the time period stipulated by CSC, but does
         believe that through diligent, ongoing and conscientious
         effort the Default can be cured within a reasonable time
         period not to exceed six (6) months, the Department may
         submit a plan for curing the Default to CSC.  The
         Department's submitted plan shall indicate in detail how the
         Department proposes to cure the Default.



10.6     Upon an occurrence of Default by the Department which cannot
         be resolved within the time periods authorized by paragraphs
         10.4.2 and 10.5, CSC's sole remedy shall be to terminate
         this Agreement upon provision of ninety (90) days prior
         written notice.  Upon such termination, CSC shall be
         entitled to receive payment from the Department for all
         services furnished under this Agreement up to and including
         the date of termination, if services have been satisfactorily
         provided and are not otherwise subject to offset as provided by law.



                                   ARTICLE XI
                                  FORCE MAJEURE



11.1     Except for  payment of sums due,  neither  party shall be liable to the
         other,  nor be deemed in Default under this Agreement,  if and ' to the
         extent that such party's  performance of this Agreement is prevented by
         reason of Force Majeure.

Contract No: 6790
Continuation Sheet



Page. 60



11.1.1            - The term "Force Majeure" ", means an occurrence that
           is beyond the control of the ,party affected and occurs




<PAGE>



           without its fault or  negligence.  Without  limiting  the  foregoing,
           Force Majeure  includes  acts of God; acts of the public enemy;  war;
           riots; strikes; mobilization;  labor disputes; civil disorders; fire;
           flood; lockouts;  injunctions;  intervention-acts;  and other similar
           occurrences  beyond the control of the party  declaring Force Majeure
           which  such  party is  unable to  prevent  by  exercising  reasonable
           diligence.



11.1.2       The  Force  Majeure  shall be  deemed  to  commence  when the party
             declaring  Force Majeure  notifies the other party of the existence
             of the Force Majeure and shall be deemed to continue as long as the
             results  or  effects of the Force  Majeure  prevent  the party from
             resuming performance in accordance with this Agreement.



11.1.2.1          If either party is delayed at any time in the
               performance of Agreement obligations by Force Majeure,
               the delayed party shall notify the other party in writing
               of such delay as soon as is practical after commencement
               thereof and shall specify the causes of such delay in the
               notice.  The notice shall be hand delivered or mailed
               certified-return receipt and shall make a specific
               reference to this Article, thereby invoking its
               provisions.



The delayed  party shall make every  effort to cause such delay to cease as soon
as practicable and shall notify the other party in writing, when it has done so.



Such delay shall not constitute  Default or give rise to any claim on damages or
loss of anticipated profits.



11.1.3 If either party experiences Force Majeure, the following
may occur:

           11.1.3.1        This Agreement may be extended by amendment for a
                         period of time equal to the time the results or
                         effects of such delay prevent the delayed party




<PAGE>



                         from performing.  Any amendment shall be subject to
                         the requirements of A.R.S. 41-1609.01A.



11.1.3.2       This   Agreement  may  be   terminated  by  either  party.   Said
               termination  shall not constitute  Default hereunder or give rise
               to any claim for damages or loss of anticipated profits.



11.     1.4 Force Majeure shall not include the following
        occurrences:

                         1          1. 1.4. 1. Late delivery of equipment or
                         materials caused by congestion at a manufacturer's
                         plant or elsewhere, or an oversold condition of the
                         market.



               1 1. 1.4.2. Late performance by a subcontractor unless
               the delay arises out of a Force Majeure occurrence in
               accordance with this Force Majeure term and condition.

11.1.4.3          Failure or refusal to act by Government authority other
               than the Department.

11.1.4.4          CSC's failure to acquire or maintain required insurance
               or performance bond.

11.1.4.5       CSC's failure to acquire and maintain required license to operate
               as a security agency and to license  designated staff as security
               officers.



                                   ARTICLE XII
                                   TERMINATION



12.1     In addition to other rights set forth elsewhere in this Agreement,  the
         Department  reserves the right to terminate this Agreement in whole, or
         in part due to the following:







<PAGE>



           12.1.1          In the event State funds for this Agreement become
           unavailable due to non-appropriation or ex-appropriation.



12.1.1.1       An event of non-appropriation or ex-appropriation shall not cause
               the  Department  to be in  Default  hereunder,  but upon any such
               event,  this  Agreement  shall  automatically  terminate  without
               further  obligation or liability to the Department as of the last
               day for which funds are available.



12.1.1.2          Department representatives cannot make any statements
               or provide any warranties as to whether an appropriation
               will be made by the Legislature; however, the Department
               shall, during the term of this Agreement, use its best
               efforts to ensure that adequate written information is
               submitted and verbal testimony provided through
               appropriate budgetary processes to request funds at least
               equal to the payments required hereunder for each year of
               the contract term.



12.1.2     CSC's failure to post an annual Performance Bond equal to 100% of the
           annual per them as required by Article VIII of this Agreement.



12.1.3            CSC's failure to provide insurance coverages that meet the
           requirements set forth
           in Article VIII and Attachment #8.

                        ARIZONA DEPARTMENT OF CORRECTIONS
                               GENERAL PROVISIONS



1.      DEFINITIONS

As used throughout these General Provisions,  the following terms shall have the
meanings set forth:







<PAGE>



         a.       "Contractor" means the person, fu-m, or organization
         performing the services or delivering the items described in
         this Contract.



b.       "State" means the State of Arizona.

C.       "Department" means the Arizona Department of Corrections.

d.       "Director" means the Director of the Arizona Department of
         Corrections or his duty authorized representative.



e.       "Subcontract"  means any contract between the original Contractor and a
         third party for the  provision of items or services  which the original
         Contractor has himself  contracted to perform,  except  purchase orders
         for standard commercial equipment, products or services.



f.       "Project Director" means the person designated to represent
         the Department in the program administration of this
         Contract.



9.       "Days" means calendar days unless otherwise specified.

h.       "Gratuity" means a payment,  loan,  subscription,  advance,  deposit of
         money,  services,  or anything of more than nominal  value,  present or
         promised,  unless consideration of substantially equal or greater value
         is received.



i.     "Solicitation" means a request for proposals, or a request
for quotation.

i.       "Special Provisions" means those provisions additional to or
         in clarification of the General Provisions.  If the General
         Provisions and Special Provisions conflict, the Special
         Provisions shall govern.



k.       "Scope of Services" means those provisions of this Contract
         which delineate the scope and manner of the specific




<PAGE>



         services to be performed  and describe the items to b-@ supplied in the
         performance of this Contract. In the event of a conflict,  the terms of
         the  Scope of  Services  shall  prevail  over the  Special  Provisions,
         General Provisions or any attachments to the Contract.



-1-
Rev. 05/94

2.       GENERAL REQUIREMENTS

         a.       Intergovernmental agreements entered into pursuant to
                  A.R.S. 11-952 et seq. shall become effective on the
                  date filed with the Secretary of State or at a later
                  date as specified in the Contract.  All other contracts
                  shall become effective on the date executed by the
                  Director or designee or at a later date as specified in
                  the Contract.



b.       This  Contract  shall be  construed  in  accordance  with  Arizona  law
         including,  where applicable, the Uniform Commercial Code as adopted by
         the  State of  Arizona.  Any  legal  action  shall be  initiated  in an
         appropriate court of the State of Arizona.



C.      The Arizona Procurement Code, Arizona Revised Statutes
        ("A.R.S.") Title 41, ' Chapter 23, and its implementing
        rules, Arizona Administrative Code ("A.A.C. ") Title 2,
        Chapter 7, are a part of this Contract as if fully set forth
        in it.



d.       Each provision of law and any terms required by law to be in
         this Contract are a part of this Contract as if fully stated
         in it.



e.       This  Contract is issued under the  authority of the  signatory for the
         Department.  Changes to the Contract, including the addition of work or
         materials,  the revision of payment terms, or the  substitution of work
         or  materials,  directed  by an  unauthorized  State  employee  or made
         unilaterally  by the  Contractor  are violations of the Contract and of
         applicable




<PAGE>



         law. Such chances,  including unauthorized written contract amendments,
         shall be void and  without  effect,  and the  Contractor  shall  not be
         entitled to any claim under this Contract based on those changes.



f.       This  Contract  is  intended  by the  parties  as a final and  complete
         expression of their agreement.  No course of prior dealings between the
         parties and no usage of the trade shall  supplement or explain any term
         used in this Contract.



Either party's failure to insist on strict  performance of any term or condition
of the Contract  shall not be deemed a waiver of that term or condition  even if
the party accepting or acquiescing in the nonconforming performance knows of the
nature of the performance and fails to object to it.

h.       The  Contract  shall  be  modified  only  through  a  written  contract
         amendment  within  the scope of the  Contract  signed by an  authorized
         signatory on behalf of the Department and the authorized representative
         of the Contractor.



i.       The provisions of this Contract are severable.  Any term or
         condition deemed illegal or invalid shall not affect any
         other term or condition of the Contract.



i.       The  Contractor  shall obtain and maintain  all  licenses,  permits and
         authority  necessary  to do  business  and render  services  under this
         Contract,  and  shall  comply  with  all  laws  regarding  unemployment
         insurance, disability -insurance and workers' compensation.

k.       The Contractor shall abide by all Department Rules, Policies
         and Procedures as applicable to Contractor fulfilling the
         obligations outlined in this Contract.



Any  allegations  of  non-compliance  with  Department  Rules,  Policies  and/or
Procedures,  or other Contractor misconduct shall be subject to investigation by
the Department.






<PAGE>




1.       The parties hereto agree that the Contractor shall be deemed
         an independent Contractor  in the  performance  of this  Contract,
         and  shall  not be considered an officer, employee or agent of the
         State unless Contractor is another State Agency.



3.      OTHER CONTRACTS

The  Department  may perform  additional  work related to this Contract or award
other  contracts for such work. The Contractor  shall  cooperate fully with such
other  contractors  and/or State employees in the scheduling and coordination of
its own work with such additional work.



4.       SUBCONTRACTS AND ASSIGNMENTS

         a.       Unless  otherwise  agreed by the terms of this  Contract,  the
                  Contractor  shall not subcontract with any other party for the
                  furnishing  of any of the  work  or  services  contracted  for
                  herein without the prior written  approval of the  Department.
                  The subcontract  shall  incorporate by reference the terms and
                  conditions of this Contract.



b.       No rights or obligations of the Contractor under this
         Contract shall be assigned without the prior written
         approval of the Department.



5.      OWNERSHIP OF INFORMATION

Title to all reports,  information,  data,  computer  data elements and software
prepared by the  Contractor in  performance  of this Contract  shall vest in the
State.  Subject to applicable State and Federal laws and regulations,  the State
shall  have full and  complete  rights to  reproduce,  duplicate,  disclose  and
otherwise  use all such  information.  The  Contractor  shall not use or release
these materials without the prior written consent of the State.






<PAGE>




6.      ADVERTISING AND PROMOTION OF CONTRACT

The Contractor shall not advertise or publish information for commercial benefit
concerning this Contract without the prior written approval of the Department.



7.       CONFIDENTIALITY OF RECORDS

The  Contractor  shall  establish and maintain  procedures and controls that are
acceptable to the  Department  for the purpose of assuring  that no  information
contained  in its  records or  obtained  from the  Department  or from others in
carrying out its functions under this

Contract  shall  be used or  disclosed  by the  Contractor  or the  Contractor's
agents,  officers,  or employees,  except as is essential to the  performance of
duties under this Contract.

Persons  requesting such information  should be referred to the Department.  The
Contractor also agrees that any  information  pertaining- to offenders shall not
be divulged,  0 other than to employees or officers of Contractor as is required
for the performance of duties under the Contract,  except upon the prior written
consent of the Department.



8.      BOOKS AND RECORDS

        Contractor shall retain and shall require all of its  subcontractors  to
        retain  for  inspection  and  audit by the State  all  books,  accounts,
        reports, files and other records relating to the bidding and performance
        of this Contract for a period of five (5) years after its completion.


Upon request by the  Department,  a legible  copy of all such  records  shall be
produced by the Contractor at the administrative  office of the Department or at
the office of the State Auditor.  The original of all such records shall also be
available and produced for

inspection and audit when requested by the State Auditor or the
Department to verify the
authenticity of copy.






<PAGE>




9.      FINANCIAL AUDIT

At any  time  during,  the  term  of  this  Contract,  the  Contractor's  or any
subcontractor's  books and records are subject to audit by the Department and by
any other appropriate agent of State or Federal  Government,  to the extent that
the books and records relate to the performance of the Contract or subcontract.



10.     REPORTS

Records  which  relate to  disputes,  litigations  or the  settlement  of claims
arising out of the performance of this Contract, or to cost and expenses of this
Contract as to which exception has been taken by the Director,  or his designee,
shall be retained by the Contractor until such appeals,  litigations,  claims or
exceptions have been finally resolved.


11.     VISITATION AND INSPECTION

Department  representatives  or other  appropriate  agents  of the State or
Federal  government shall. with timely notice to the Contractor,  be entitled to
review and inspect the Contractor's facilities,  its program operation and those
records which pertain to the program or services funded by this Contract during,
the term of this Contract.


12.     PROGRAM EVALUATION

The Department shall be entitled,  during the term of this Contract, to evaluate
Contract  Services.  Evaluations  will assess the quality and impact of Contract
Services,  either in isolation or in comparison with other similar  services and
will assess the  Contractor's  progress and success in  achieving  the goals and
objectives set forth in the Scope of Services.

13.     INDEMNIFICATION

Contractor shall  indemnify,  defend and hold harmless the State from any claim,
demand, suit, liability, judgment and expense (including any attorneys' fees and
other costs of  litigation)  arising out of or relating to injury,  disease,  or
death  of  persons  or  damage  to or  loss  of  property  resulting  from or in
connection with the negligent performance of this Contract by the




<PAGE>



Contractor,  its agents,  employees, and subcontractors or any one for whom
the Contractor may be responsible. The obligations,  indemnities and liabilities
assumed by the Contractor under this paragraph shall not extend to any liability
caused  by the  negligence  of the  State  or its  employees.  The  Contractor's
liability  shall not be limited by any  provisions  or limits of  insurance  set
forth in this Contract. The Department shall reasonably notify the Contractor of
any claim for which it may be liable under this paragraph



14.     INSURANCE

        a.     Without  limiting any  liabilities  or any other  obligations  of
               Contractor,  Contractor  shall provide and maintain and cause its
               subcontractors  to provide and maintain  insurance  coverage with
               forms and insurers acceptable to the State, until all obligations
               under this Contract are satisfied, as follows:



(1)      Workers' Compensation insurance to cover obligations imposed
         by Federal and State statutes having jurisdiction of its
         employees engaged in the  performance of the Services, and Employers'
         Liability  insurance with a  minimum  limit  of one  hundred
         thousand  dollars  ($100,000).  Evidence of qualified  self-insured
         status shall also suffice for this section.



(2)      Commercial  general liability  insurance with a minimum combined single
         limit of one million dollars  ($1,000,000) each occurrence.  The policy
         shall include coverage for bodily injury,  personal injury,  broad form
         property  damage,  blanket  contractual,  contractor's  protective  and
         products and completed operations.



(3)      Comprehensive  automobile  liability  insurance with a combined  single
         limit  for  bodily  injury  and  property  damage  of not less than one
         million  dollars  ($1,000  ,  000)  each  occurrence  with  respect  to
         Contractor vehicles (whether owned, hired,




<PAGE>



         non-owned), assigned to or utilized in the performance of
         this Contract.



(4)      Professional liability insurance with limits of one million
         dollars ($1,000,000) each claim.



b.       The policies required by section a. (2), (3) and/or (4)
         shall name the State of Arizona, its agents, officials and
         employees as additional insured and shall specify that the
         insurance afforded Contractor shall be primary insurance and
         that any insurance coverage carried by the State, the
         Department or its employees shall be excess coverage except
         as provided by State law, and not contributory insurance to
         that provided by the Contractor..

C.       Failure on the part of the Contractor to procure and
         maintain the required liability insurance and provide proof
         thereof to the Department within thirty (30) days following
         the commencement of a new policy period, shall constitute a
         material breach of the.  Contract upon which the Department
         may immediately terminate this Contract.  Prior to the
         effective date of this Contract, the Contractor shall
         furnish the Department with an appropriately executed
         certificate of insurance.  Such certificate shall identify
         this Contract and contain provisions that coverage afforded
         under the policies shall not be canceled, terminated or
         materially altered until at least thirty (30) days prior
         written notice has been given to the Department.  The
         Contractor may utilize the State of Arizona Certificate of
         Insurance (RM-7200.1) or other forms acceptable to the State
         to identify insurance coverage.  The State of Arizona
         reserves the right to request and receive certified copies
         of any or all of the above policies and/or endorsements.



15.      WARRANTY

Contractor  warrants  that all  non-service  items  furnished  pursuant  to this
Contract shall be free from defects and shall conform to Contract  requirements.
Any items determined by the Department to be in nonconformity with this warranty
shall  be  repaired  or  replaced,   at  the  Department's  option  and  at  the
Contractor's expense, for up to one year following the completion or termination
of this Contract. The Contractor warrants that, for




<PAGE>



one year after acceptance by the Department of the materials,
they shall be:



a.       Of a quality to pass without objection in the trade under
         the Contract description;

b.       Fit for the ordinary purposes for which the materials are
         used;

C.       In conformance with the written promises or affirmations of
         fact made by the Contractor.



16.     RIGHT TO ASSURANCE

        If the State in good  faith has reason to  believe  that the  Contractor
        does not intend to perform or continue  performing  this  Contract,  the
        Department  may demand in  writing  that the  Contractor  give a written
        assurance  of  intent  to  perform.  The  demand  shall  be  sent to the
        Contractor by certified mail,  return receipt  required.  Failure by the
        Contractor  to  provide  written  assurance  within  the  number of days
        specified in the demand may, at the  Department's  option,  be the basis
        for terminating the Contract under paragraph 19.



17.     DISPUTES

a. In the event of a  controversy  concerning a question of fact  arising  under
this Contract which cannot be resolved by mutual agreement  between the Contract
Administrator and the Contractor,  the aggrieved or dissatisfied person may file
a written  request for review with the  Department's  Director.  The request for
review must  specifically  outline the  parameters of the  controversy  and only
those facts presented  within those specific  parameters will be reviewed by the
Director who shall adhere to the Arizona  Procurement  Rules and  Regulations in
responding  to' the issue  presented.  The  Contractor may appeal the Director's
final decision to the Director.  of the Department of Administration within five
days of  receipt of the  Director's  decision  in  accordance  with the  Arizona
Procurement Rules and Regulations. Hearings on appeals of claims decisions shall
be conducted as contested  cases pursuant to the Arizona  Procurement  Rules and
Regulations and the Arizona Administrative Procedures Act (Article 1, Chapter 6,
Title 41, Arizona Revised Statutes) except for those claims which are subject to
arbitration as set




<PAGE>



forth in paragraph "b" below.  Pending,  final decision of the controversy, the
Contractor shall proceed  diligently with the performance of the Contract and in
accordance with the Director's decision.



         b.       The parties agree to use arbitration to resolve
         disputes to the extent required by A.R.S. 12-1518.



18.      TERMINATION OF CONTRACT

         The Department,  or the State, may terminate this Contract under any of
         the conditions following:



a.       The Department,  in addition to other rights set forth elsewhere in the
         Contract,  reserves the right to terminate this Contract,  in whole, or
         in part without cause, effective thirty (30) days after mailing written
         notice of termination by certified mail, return receipt  requested,  to
         the Contractor.



(1)      In the event of termination as provided in this section, the Contractor
         shall  stop all work as  specified  in the  notice of  termination  and
         immediately notify all subcontractors in writing to do the same.



(2)      Contractor shall be paid the Contract price for all services
         and items completed.  In addition, Contractor will be paid
         its reasonable actual costs for work in progress as
         determined by generally accepted accounting principles and
         practices.  Upon such termination, the Contractor shall
         deliver to the Department a complete set of all documents,
         programs and other information described in the Contract.



b.       The Department may, by written notice to the Contractor, also terminate
         this  Contract  if  it  is  found  that   gratuities  in  the  form  of
         entertainment,  gifts,  or  otherwise  were  offered  or  given  by the
         Contractor,  or any agent or representative  of the Contractor,  to any
         officer or employee of the State with a view toward securing a contract
         or




<PAGE>



         securing favorable treatment with respect to the awarding,  or amending
         or the making of any determinations  with respect to the performance of
         such contract; provided, that the existence of the facts upon which the
         Department makes such findings shall be in issue and may be reviewed in
         any competent  court. If the Contract is terminated under this section,
         unless the  Contractor is a  governmental  agency,  instrumentality  or
         subdivision  thereof,  the  Department  shall  be  entitled,  by way of
         penalty,  to  exemplary  damages in the amount of three times the costs
         incurred by the Contractor in providing any such

gratuities to any such officer or employee, in addition to any other
damages to which it may be entitled by law.



C.       The State of Arizona may cancel this Contract without
         penalty or further obligation to the State pursuant to
         A.R.S. 38-511, if any person significantly involved in
         initiating, negotiating, securing,, drafting or creating
         this Contract on behalf of the State of Arizona is or
         becomes at any time, while this Contract or any extension of
         this Contract is in effect, an employee of any other party
         to this Contract in any capacity or a consultant to any
         other party to this Contract with respect to the subject
         matter of this Contract.  Cancellation shall be effective
         when written notice is received by all parties to this
         Contract, unless the notice specifies a later time.



19.     DEFAULT

        a.     The  Department,  in addition to other rights set forth elsewhere
               in the Contract,  may at any time terminate this Contact in whole
               or in part, if it is determined that the Contractor has failed to
               perform any  requirements  of this Contract or has failed to make
               satisfactory progress toward performance.


        b.     The Contractor shall continue the performance of this
               Contract to the extent not terminated under the provisions
               of this section.





<PAGE>





C.       In the event the Department terminates this Contract in
         whole or part as provided in this section, the Department
         may procure, upon such terms and in such manner as it may
         deem appropriate, services similar to those so terminated,
         and unless the Contractor is a governmental agency,
         instrumentality or subdivision thereof, it shall be liable
         to the Department for any excess costs incurred by the
         Department in obtaining- such similar services.



d.       If this Contract is terminated as provided herein, the
         Department, in addition to any other rights provided in this
         section. may require the Contractor to transfer title to and
         deliver to the State, in the manner and to the extent directed by
         the Department, such partially completed reports or other
         documentation as the Contractor has specifically, produced or
         specifically acquired for the performance of such part of this
         Contract as has been terminated.  Payments for completed reports
         and other documentation delivered to and accepted by the
         Department shall be at the contract price.  Payment for partially
         completed reports and other documentation delivered to and
         accepted by the Department shall be in an amount agreed upon by
         the Contractor and the Department.



e.       The rights and remedies of the Department enumerated in this
         section shall be in addition to any other rights and
         remedies provided by or under this Contract.


20.      NON-DISCRIMINATION

The Contractor  shall comply with State  Executive Order No. 75-5 which mandates
that all persons, regardless of race, color, religion, sex, age, national origin
or political affiliation,  shall have equal access to employment  opportunities,
and all  other  applicable  Federal  and  State  laws,  rules  and  regulations,
including  the  Americans  with  Disabilities  Act.  The  Contractor  shall take
affirmative  action to ensure that  applicants  for employment and employees are
not discriminated  against due to race, creed,  color,  religion,  sex, national
origin or disability. The Department is an Equal Employment Opportunity Agency.





<PAGE>





21.     ASSIGNMENT OF OVERCHARGES

The  Contractor  assigns to the State any claim for  overcharges  resulting from
antitrust  violations to the extent that those violations  concern  materials or
services supplied by third parties to the Contractor toward  fulfillment of this
Contract.



22.     CONTRACT PAYMENTS

        a.     Funds may not presently be available for performance under
               this Contract beyond the current fiscal year.  No legal
               liability on the part of the State for any payment may arise
               under this Contract beyond the current fiscal year until funds
               are made available for performance of this Contract.  The
               Department will make reasonable efforts to secure such funds.
               The Department shall not be liable for any purchases and/or
               contracts entered into by the Contractor in anticipation of
               such funding.



b.       Payments made by the Department to the Contractor are conditioned
         upon receipt of applicable, accurate and complete reports to be
         submitted by the Contractor.



C.       If the Contractor is in any manner in default in the
         performance of any obligation under this Contract, or if
         audit exceptions are identified, the Department may, at its
         option and in addition to other available remedies, either
         adjust the amount of payment or withhold payment until
         satisfactory resolution of the default or exception.  The
         Contractor shall have the right to written notice of the
         Department's action in adjusting the amount of payment or
         withholding payment.  Under no circumstances shall the
         Department authorize payment to the Contractor that exceeds
         an amount specified in the Contract without a written
         amendment to the Contract.  The Department may, at its
         option, withhold final payment under the Contract until
         receipt of all final reports and deliverables or completion
         of any financial audit.



23.      RECOUPMENT OF CONTRACT PAYMENTS





<PAGE>



a. Any  unearned  Department  funds  that have been paid to the  Contractor  and
remain in its  possession at the end of the contract  period,  or at the time of
termination  of  the  Contract,  shall  be  refunded  to the  Department  within
forty-five (45) days thereafter.

b.       The  Contractor  shall  reimburse the Department for all contract funds
         received which are determined by the Department or the Auditor  General
         not to have been earned in accordance with the terms of the Contract.

         C. If Federal  or State  audit  exceptions  are made  relating  to this
         Contract the Contractor shall reimburse all costs incurred by the State
         of Arizona and the Department  associated  with  defending  against the
         audit exception or performing an audit or follow-up audit including but
         not  limited  to:  audit  fees,   court  cost  travel  costs,   penalty
         assessments,  attorney fees for the Assistant  Attorney General,  based
         upon  reasonable  charges  in the  community,  and all  other  costs of
         whatever nature.



d.       Immediately upon notification from the Department, the
Contractor shall reimburse the amount of the audit exception and
any other related costs directly to the Department.



      e. The Contractor  shall indemnify the Department and the State of Arizona
         and hold them, their officers,  agents,  and employees harmless against
         any and all liability or damages in regard to audit exceptions.


24.      INFRINGEMENT OF PATENTS AND COPYRIGHTS

                a. The Contractor, at his own expense, shall defend any claim or
                suit which may be brought against the State for the infringement
                of  United  States  patents  or  copyrights  arising,  from  the
                Contractor's or Department's use of any equipment, materials, or
                information prepared or developed in connection with performance
                of this Contract and in any suit will satisfy any final judgment
                for such  infringement.  The Department shall reasonably  notify
                the  Contractor  of any claim  for which it may be liable  under
                this paragraph.







<PAGE>



         b. If  principles  of  governmental  or public law are  involved ., the
         State may  participate in the defense of any such action,  but no costs
         or expenses  shall be incurred  for the account of  Contractor  without
         written consent.



C.       If in Contractor's opinion, the equipment, materials or
         information mentioned in paragraph a. above is likely to or
         does become the subject of a claim of infringement of a
         United States patent or copyright, then without diminishing
         Contractor's obligation to satisfy any, final award,
         Contractor may, with the Director's written consent,
         substitute other equally suitable equipment, materials and
         information, or at Contractor's option and expense, obtain
         the right for Contractor or the Department to continue the
         use of such equipment, materials and information.



25.     NOTICES

Whenever notice is required pursuant to the terms of this Contract,  said notice
shall be in  writing,  and  shall  be  directed  to the  persons  and  addresses
specified for such purpose in Scope of Services or to such other persons  and/or
addresses  as either party may  designate to the other party by written  notice.
Notice  shall be  delivered  in  person or by  certified  mail,  return  receipt
requested.

26.     SUSPENSION OR DISBARMENT

The Department may, by written notice to the Contractor,  immediately  terminate
this  Contract  if it is  determined  that the  Contractor  has been  disbarred,
suspended or otherwise  lawfully  prohibited  from  participating  in any public
procurement activity.



27.      NONEXCLUSIVE REMEDIES

The rights and the remedies of the State under this Contract are not exclusive.




<PAGE>








                               SPECIAL PROVISIONS


  With regard to the General Provisions:
  All  references to Contractor  shall mean  Correctional  Services  Corporation
  (CSC). All references to Contract shall mean "Agreement.

  PARAGRAPH 13
  Paragraph 13 is replaced by Article VIII of the Scope of Services.

  PARAGRAPH 14
  Paragraph 14 is replaced by Paragraphs 8.2-4,  8.2.5 and Attachment #8 of this
  Agreement.

  PARAGRAPH 18
  Subparagraph a is amended to read as follows:

  The  Department,  in  addition  to other  rights  set forth  elsewhere  in the
  Agreement reserves the right to terminate this Agreement, in whole, or in part
  without cause,  one year after receipt of the first inmate,  effective  ninety
  (90) days after  mailing  written  notice of  termination  by certified  mail,
  return receipt requested, to CSC.


PARAGRAPH 24

Paragraph 24 is replaced by Paragraph 8.6 in Article VIII of the
Scope of Services




<PAGE>








ATTACHMENT #2



                              POSITION DESCRIPTION

Name of Contractor:

Position Name:

         Check the box if this is a security position.  Check the box if this is
         a position performing case management services.

         Check  the box if this is a  position  responsible  for entry of inmate
         information into the Adult Inmate Management System (AIMS)

WORK  DESCRIPTION - In general  terms,  what will the work  assignment be for an
employment working in this position?




WORK PRODUCTS - What will result from the work performance?




RESPONSIBILITY   -  For  what  will  the  employee  in  this  position  be  held
responsible?  (For example, money, equipment, safety of others, product quality,
work methods, policies or procedures, etc.)




AUTHORITY  - What kinds of  decisions  will the  employee  in this  position  be
authorized  to make?  What kinds of decisions  will require  clearance  from the
supervisor?



KNOWLEDGE - What does an employee have to know to perform satisfactorily in this
position?  By knowledge is meant  familiarity  with  something or  possession of
information or understanding in the mind. State specifically what the employee




<PAGE>



must know. (Do not give degrees and do not list entire fields,
such as chemistry, engineering or psychology.)



SKILLS - What skills must the employee in this  position  have acquired in order
to perform work  satisfactorily?  By skill is meant the developed  capability to
perform tasks or actions  effectively.  A skill may be developed in a variety of
manual, physical, intellectual or interpersonal activities. Please be specific.



WORK  ACTIVITIES  - What  are the  actual  work  activities  the  employee  will
experience in the course of performing work assignments?  What will the employee
be doing?



MINIMUM QUALIFICATIONS -




To whom will any employee in this position report?



<PAGE>





                                  ATTACHMENT #3


             Name of Contractor: Correctional Services Corporation

                                 SUBCONTRACTORS
                    (Please duplicate this page if necessary)



Name (Business):  Correctional Services, Inc.
Address:  12647 Olive Boulevard, St. Louis, Missouri 63141
Telephone Number(s):
Type of Service: Inmate Medical Services
Contact Person: Michael G. Pfeiffer, Executive Vice President



Name (Business):
Address:
                    Street         City                   Zip
Telephone Number(s):
Type of Service:
Contact Person:



Name (Business):
Address:
                    Street         City                   Zip
Telephone Number(s):
Type of Service:
Contact Person:



Name (Business):
Address:
                    Street         City                   Zip
Telephone Number(s):
Type of Service:
Contact Person:




<PAGE>




                                  ATTACHMENT #4

PRE-SERVICE SECURITY TRAINING


Listed by Functional Areas and Course Titles

Functional Area I:  Ethics and Professionalism

<TABLE>
<CAPTION>


Course Titles:                                                                                  Hours

<S>                                                                                              <C>

*Employee Rules and Regulations                                                                  3.0
*Valuing Work Force Diversity/EEO                                                                3.0
 Ethical Staff-Inmate Relations                                                                  3.0
*Employee Grievance                                                                              1.0
 Professionalism and Ethics                                                                      3.0
*Uniform and Grooming                                                                            1.5

TOTAL COURSE HOURS                                                                              14.5


Functional Area II:  Inmate Management

Course Titles:                                                                                  Hours

Sociology of a Correctional Institution                                                          2.0
Inmate Supervision                                                                               5.0
Inmate "Games" (Manipulation and Set-Ups)                                                        3.0
Inmate Classification System                                                                     2.0
Inmate Ethnic Diversity                                                                          6.0
Discretion and Decision Making                                                                   5.0
Inmate Grievance System                                                                          1.0
Inmate Programs                                                                                  1.5
Inmate Disciplinary System                                                                       6.0

TOTAL COURSE HOURS                                                                              31.5


Functional Area III:  Legal Issues

Course Titles:

Criminal Justice System, Law and Rights                                                          6.0
Arizona Government                                                                               1.0
Use of Force                                                                                     3.0

TOTAL COURSE HOURS                                                                              10.0

</TABLE>




<PAGE>








Page 2
Attachment #4
Pre-Service Security Training


Functional Area IV:  Communications

<TABLE>
<CAPTION>

Course Titles:                                                                                  Hours

<S>                                                                                              <C>


Report Writing                                                                                   6.0
Basic Communication                                                                              3.0
Radio and Telephone Communication                                                                2.0
   (Knowledge of Department radio system shall be
   required relevant to direct communication to
   the Department)
Observation (Use of a Field Notebook)                                                            1.0
Oral Reports                                                                                     3.0
Effective Study and Note Taking                                                                  0.5

TOTAL COURSE HOURS                                                                              15.5


Functional Area V:  Officer Safety

Course Titles:                                                                                  Hours

Non-Lethal Weapons Familiarization                                                               4.0
Chemical Agents                                                                                  4.0

TOTAL COURSE HOURS                                                                               8.0



Functional Area VI:  Applied Skills

Course Titles:                                                                                  Hours

Searches and Contraband                                                                          4.0
Transportation and Restraints                                                                    3.0
Count Procedures                                                                                 1.5
Applied Skills                                                                                   7.5
Forced Cell Moves                                                                                2.0
Maximum Restraints                                                                               2.0
Inmate Property Management                                                                       3.0
Urine Collection                                                                                 1.0

TOTAL COURSE HOURS                                                                              24.0

Page 3
Attachment #4
Pre-Service Security Training




<PAGE>




Functional Area VII:  Security, Custody and Control

Course Titles:                                                                                  Hours

Security, Custody and Control                                                                    3.0
Introduction to IMS and Emergency Procedures                                                     5.0
Crime Scene Protection                                                                           2.0
Fire Prevention/Evacuation                                                                       5.0
*Internal Investigations                                                                         2.0
Institution Observation (Including Travel Time)                                                 15.0
TOTAL COURSE HOURS                                                                              32.0

Functional Area VIII:  Conflict and Crises
Management

Course Titles:                                                                                  Hours

Introductory/Overview of Crises/Conflict in a
Correctional Institution                                                                         4.0
Goals and Concerns of Crises/Conflict in a
Correctional Institution                                                                         3.0
Principles and Techniques of Crises, Conflict
Intervention & Resolution in a Correctional
Institution                                                                                      6.0
Practical Skills Crises/Conflict in a Correctional
Institution                                                                                      7.0
Self-Defense Training                                                                           18.0
TOTAL COURSE HOURS                                                                              38.0

Functional Area IX:  Medical and Mental Health

Course Titles:                                                                                  Hours

First Aid (Medical Signs/Symptoms)                                                               2.0
Basic Life Support - (Requested graphics are
contained within lesson plan)                                                                    7.0
Communicable Disease Control                                                                     3.0
Communicating Signs and Symptoms of Mental Illness                                               2.0
Narcotics and Dangerous Drugs                                                                    2.0
Substance Abuse Awareness                                                                        3.0
Physical Fitness Training                                                                       22.5

TOTAL COURSE HOURS                                                                              41.5

</TABLE>


*Indicates  courses to be taught by CSC  utilizing  CSC's  curricula  and lesson
plans, if approved by the Department.



<PAGE>









ATTACHMENT #5
REQUIRED COURSES
PRE-SERVICE NON-SECURITY TRAINING
(New Employee Orientation)

PHASE I

         A.     Initial Orientation

                1.     Employee Vehicle Searches and Contraband
                2.     Inmate/Staff Relations
                3.      Background Checks and Arrest/Citation/Incarceration


B.      Occupational Safety

                1.   Bloodborne Pathogens
                2.     Work Safety and Prevention

PHASE II

         A.     Introduction to Arizona State Government

                1.     Arizona History
                2.     Executive Branch of Arizona Government
                3.     Legislative Branch of Arizona Government
                4.     Judicial Branch of Arizona Government

        B.      Arizona Department of Corrections

        1.   Arizona Department of Corrections
        2.   Divisions and Bureaus
        3.   Institutions, Offices, Release Centers, Private
             Institutions, COTA
        4.   Chain of Command
        5.   Criminal Justice System (Federal, State, County and City)
        6.   Arizona and Department of Corrections Demographics and
             Cost of Incarceration

      C.     Institutional (Specific) Orientation

      1.     Institutional Organization and Units
      2.     Institutional Organization and Unit Structure
      3.     Institutional Demographics, Budget and Staffing
      4.     Terminology, Abbreviations, Codes, Acronyms



<PAGE>








Page 2
Attachment #5
Required Pre-Service Non-Security Training

D. Institutional Sociology and Inmate Programs
      1 - Inmate Demographics
      2.     Inmate Visitation
      3.     Inmate Work Programs and Inmate Work Incentive Pay Plan
             (WIPP)

4.      - Inmate Grooming and Dress Standards
        5.        Inmate Non-Work Programs
        6.        Special Inmate Populations
        7.        Inmate Gangs and Cultures

E.    Institutional Operations and Security
      1.   Institutional Security
      2.   Inmate Accountability/Counts/Passes/identification
      3.   Tool and Key Control
      4.   Inmate Transportation and Movement
      5.   AIMS, Telephone Security, Inmate Telephone Usage, Security
           Radios
      6.   Vehicle Security
      7.   Emergency Procedures, Disturbances and Incident Management

F.    Staff/Inmate Relations and Staff/Staff Relations
      1.     Inmate Manipulation, Games and Set-ups
      2.     Financial, Social and Romantic Relationships
      3.     Verbal Abuse and Non-Verbal Intimidation
      4.     Incident Reports and Supervisor Assistance
      5.     Staff to Staff Relationships

G.      Inmate Management and Supervision
        1.   Inmate Supervision Techniques
        2.   Inmate Classification System
        3.   Inmate Disciplinary System and Write-ups
        4.   Inmate Grievance System
        5.   Inmate Access to Courts and Legal System

H.      New Employee Orientation (NEO) Program Review and
        Summarization

           Recordkeeping
           a.     Bloodborne Pathogens
           b.     Professionalism and Ethics I
         c. NEO



<PAGE>









Page 3
Attachment #5 Continued
OPTIONAL COURSES
PRE-SERVICE NON-SECURITY TRAINING
(New Employee Orientation)

PHASE I

A.      Initial Orientation - Overview

        1.     Department of Corrections (ADC) Mission Statement
        2.     ADC Code of Ethics
       3.         Professional Grooming and Dress Standards
        4.   Review ADC Employee Handbook
a.      Employee Benefits & Personnel Programs
b.      After Hours Employment
        5.        Employee Performance and Appraisal System
        6.        Telephone Skills and Directory Reference

B.    Institutional Introduction

      1.     Warden's Welcome
      2.     Institutional Structure and Organization
      3.     Next Scheduled New Employee Orientation Program
      4.     Individualized Employee Training Plan

C.    Personnel Processing -- In-Take

      1.     W-2 Payroll, Salary, Work Hours, PAR, Types of Leave
      2.       ADC Photo and Identification
      3.       Emergency Contact Data
      4.       Employee Benefits, Health Insurance
      5.       Major Personnel Programs
      6.       Deferred Compensation Program, Retirement, Disability,
               etc.
      7.       Arizona Driver's License, Registration and Auto Insurance
      8.       Conditions of Employment Form
      9.       Credit Unions
      10.    ADC Employee Handbook
      11.   Industrial Injury Reports

D.      Work Site Orientation
        1.   Introduction to Supervisor
        2.   Telephone Usage and Director
        3.   Meals and Dining Facilities
        4.   Transportation, Car Pooling, Parking
5.       Employee Performance and Appraisal System Discussion



<PAGE>









Page 4
Attachment #5
Optional Pre-Service Non-Security Training

PHASE II

         A.     Staff Development and Training

                1.    Annual Training Requirement
                2.    Tuition Reimbursement Program
                3.    Community College Program
                4.    Continuing Education and Licensure Credits
                5.    Outside Training Activities and Credit
                6.    Employee Training Records

B.    Civil Rights and Employee Discrimination Issues

      1    - EEO and Affirmative Action for ADC
      2.     Sexual Harassment
      3.     Americans with Disabilities Act (ADA)

C. Institutional Familiarization Tour

1 - Points of Interest
2.      Perimeter Security
3.      Parking Locations
4.      Communications and Central Control

D.      Professionalism and Ethical Behavior

        1.     Employee Discipline
        2.     Code of Ethics
        3.     Policies, Rules, Laws
        4.     Professional Responsibility
        5.     American Correctional Association

E. Valuing Staff Diversity

1. Cultural
2. Racial
3. Gender
4.    Disability

F. New Employee Program Review and Summarization

1 - Questions and Answers/Review
2.       Final Examination



<PAGE>









ATTACHMENT #5
Page 5

                   COTA VIDEOTAPES VIDEOTAPES THE CONTRACTOR.
               WILL HAVE TO PURCHASE FROM THE IDENTIFIED VENDORS:

<TABLE>
<CAPTION>


TITLE                                                                                            VENDOR

<S>                                                                                                <C>


THE CORRECTIONAL OFFICER: EXTERIOR SECURITY                                                      AIMS MEDIA
THE CORRECTIONAL OFFICER: TACTICAL MISTAKES                                                      AIMS MEDIA
THE CORRECTIONAL OFFICER: INMATE TRICKS                                                          AIMS MEDIA
THE CORRECTIONAL OFFICER: OFFICER OBSERVATION                                                    AIMS MEDIA
THE CORRECTIONAL OFFICER: PRINCIPLES OF SECURITY                                                 AIMS MEDIA
THE CORRECTIONAL OFFICER: INTERIOR SECURITY                                                      AIMS MEDIA
THE CORRECTIONAL OFFICER:                                                                        AIMS MEDIA
  ASSAULT ON OFFICERS, ATTITUDE MISTAKES                                                         AIMS MEDIA
THE CORRECTIONAL OFFICER: HANDLING AGGRESSIVE INMATES                                            AIMS MEDIA
THE CORRECTIONAL OFFICER: COMMUNICATION SKILLS                                                   AIMS MEDIA
THE CORRECTIONAL OFFICER: DECISION EXERCISES                                                     AIMS MEDIA
THE CORRECTIONAL OFFICER: ETHICS & CONDUCT                                                       AIMS MEDIA
CRIME SCENE PRESERVATION                                                                         AIMS MEDIA
EMOTIONAL DISTURBANCES                                                                           AIMS MEDIA
SUICIDAL INMATES                                                                                 AIMS MEDIA
SUPERVISION OF SPECIAL INMATES                                                                   AIMS MEDIA
CON GAMES INMATES PLAY                                                                           AIMS MEDIA
PRINCIPLES OF DISCIPLINE                                                                         AIMS MEDIA
COURTROOM DEMEANOR                                                                               AIMS MEDIA
SECURITY IN A CORRECTIONAL INSTITUTION                                                           AIMS MEDIA
OFFICER SAFETY                                                                                   AIMS MEDIA
DINING ROOM CONDUCT                                                                              AIMS MEDIA
INTRODUCTION TO CONTRABAND                                                                       AIMS MEDIA
INMATE BODY SEARCHES CLOTHED AND UNCLOTHED                                                       AIMS MEDIA
CELL SEARCHES                                                                                    AIMS MEDIA
RECOGNIZING DRUG ABUSE                                                                           AIMS MEDIA
PROBLEM EXERCISES: STAFF/INMATE RELATIONS                                                        AIMS MEDIA
INMATE/STAFF RELATIONS - PART I                                                                  AIMS MEDIA



<PAGE>








Attachment #5
COTA Videotapes
Page 6

TITLE                                                                                            VENDOR
INMATE/STAFF RELATIONS - PART II                                                                 AIMS MEDIA
HOW INMATES VIEW STAFF                                                                           AIMS MEDIA
DOING TIME - LIFE AS AN INMATE                                                                   AIMS MEDIA
SUPERVISION OF INMATES                                                                           AIMS MEDIA
DRUG PROFILES                                                                                    AIMS MEDIA
BASTA                                                                                            CALIFORNIA DOC
A MATTER OF BALANCE                                                                              CINEMED
YOU MAKE THE DIFFERENCE                                                                          COPELAND &GRIGGS
EXTINGUISH THAT FIRE                                                                             FILM COMMUNICATION
FIRE CONCEPTS AND BEHAVIOR                                                                       FILM COMMUNICATION
PCP YOU NEVER KNEW                                                                               HARPER & ROW CORRECTIONAL
MEDIANO SHORTCUT TO SURVIVAL                                                                     LA EDUCATIONAL MEDIA
CON GAMES BEHIND BARS                                                                            LA EDUCATIONAL MEDIA
FIRE IN THE JAIL                                                                                 MTI FILM AND VIDEO
SERIOUS BLOODBORNE INFECTIONS:
   CORRECTIONAL WORKERS                                                                          MVD #172 MERCK, VACCINE
DIVISION
IT'S THE LAW                                                                                     NIC
WORKING WITH HISPANIC OFFENDERS                                                                  NIC
CPR FOR BYSTANDERS                                                                               PYRAMID FILMS
WITH A LITTLE LUCK: SURVIVING A HOSTAGE SITUATION                                                PYRAMID FILMS
BILL COSBY ON PREJUDICE                                                                          PYRAMID FILMS


</TABLE>


<PAGE>








Attachment #5
COTA Videotapes
Page 7 .


VIDEOTAPES FILMED BY THE DEPARTMENT AND FURNISHED TO THE CONTRACTOR AT
NO CHARGE:

FORCED CELL MOVES
MAXIMUM RESTRAINTS
INCIDENT COMMAND SYSTEM
INMATE URINE COLLECTION
INMATE PROPERTY INVENTORY
USE OF RADIOS



<PAGE>








ATTACHMENT #6

                      INMATE TIME SHEET FOR DEPOSIT TO AATF
                            (Duplicate as necessary)

Contractor:

Secure Prison:  Arizona State Prison-Florence West (ASP-FW)

Reporting Period:





<PAGE>










ATTACHMENT #7 (FORMS NOT INCLUDED IN THIS DOCUMENT)


1.       PER DIEM INVOICE FORM
         A.       PER DIEM SUPPORTING DETAIL FORMS
         B.       PER DIEM CORRECTION SHEETS

2.       MONTHLY REPORTING
         FORM FOR MONIES
         OWNED/PAID BY INMATES
         FOR HEALTH CARE
         SERVICES RECEIVED





<PAGE>









ATTACHMENT #8



                             INSURANCE REQUIREMENTS

I.       COMMERCIAL GENERAL LIABILITY Coverage is to include:
           1 .    Minimum Limits of liability: $5,000,000 combined single
                  limit each occurrence, with an aggregate limit of $20,000,000.
                  All  deductibles  or  self-insured  retention  levels shall be
                  reviewed for financial adequacy.

           2.     Premises & operations, independent contractors, completed
                  operations and products liability.

        3.        The Broad Form Commercial General Liability Endorsement
                  or equivalent coverage.

        4.        The definition of personal injury be extended to
                  include mental injury, shock, fright, humiliation and
                  invasion of a private occupancy.

        5.        Extension of the definition of occurrence to the effect
                  that "injury or property damage committed to protect
                  any person or property shall not be considered to be
                  either expected or intended from the standpoint of the
                  insured.  "

        6.        Notice of Occurrence wording as follows: "Failure of an
                  agent, servant, or employee of the insured to notify
                  the company of any occurrence of which he has
                  knowledge, shall not invalidate the insurance afforded
                  by this policy as respects Additional Insured.  "

        7.        Knowledge of Occurrence wording as follows: "Knowledge of an
                  occurrence by an agent, servant, or employee of the insured
                  shall not in itself constitute knowledge by the insured,
                  unless the insured director shall have received such notice
                  from its agent, servant, or employee."

        8.        Coverage to include all elected or appointed  officials and to
                  extend to the liability of the  Department,  its  departments,
                  agencies,  boards and commissions,  and its agents,  officers,
                  directors,  and employees with respect to the operation of the
                  Contractor.

        9.        All employees and volunteers should be included as
                  insured "while acting on behalf of or for the benefit
                  of the named insured.  " Any exclusion of coverage as




<PAGE>



                  respects injury to fellow employees is to be deleted at
                  the insured option.

        10.       Employee Benefit Liability Protection: Coverage should
                  be applicable to "all employee benefit plans" of
                  Contractor and its departments, agencies, boards and
                  commissions and all officers, agents and employees
                  thereof.

        11.       Deletion of any exclusion for explosion, collapse and
                  underground property damage hazards.

           12.    Products coverage shall be for all products of any
                  kind.

        13.       It is agreed  that  damages is  defined  to mean  compensatory
                  damages and  includes  punitive  damages  unless it is against
                  public policy to pay punitive damages.

        14.       Coverage is to include personal injury and property
                  damages arising from the law enforcement activities
                  including jail operations.

        15.       Occurrence shall include acts committed to protect life or
                  property, or in the pursuit of assigned duties.

        16.       Personal injury to include: bodily injury, mental
                  injury, anguish or shock, sickness or disease,
                  including death or disability at any time resulting
                  therefrom and resulting from the following:

                  a.       Wrongful entry, eviction or other invasion of the
                  right of private occupancy;

                  b.       Discrimination;

                           c.  Humiliation;

                           d.  The publication or utterance of a libel, slander
                           or other defamatory or disparaging material, or a
                           publication or utterance in violation of an
                           individual's right of privacy;

                           e.  Assault and battery;

                           f.  First Aid, failure to render medical assistance;

                           g.  Violation of property rights;





<PAGE>



                            h.  Violation of civil rights; or

                            i.  Jail operations

         17.      No exclusion pertaining to injury of an individual in
                  the custody of the Contractor or failure to render
                  medical assistance, or failure to provide adequate
                  protection.

Additional  insured:  The  State  and the  Department  of  Corrections  shall be
additional  insured as their  interest may appear with respect to the operations
of the Contractor.

II.     COMMERCIAL AUTOMOBILE LIABILITY

               1.          To cover all owned, hired and non-owned vehicles
               including automobiles and trucks under long term lease.
               Minimum Limit of Liability: $1,000,000 combined single
               limit each occurrence, with an aggregate limit of
               $16,000,000.  All deductibles or self-insured retention
               levels shall be reviewed for financial adequacy.

         2.    Uninsured/underinsured motorist coverage should be
               included.

        3.     Additional insured coverage for lessors of leased
               vehicles where required by the terms of the lease.

        4.     Deletion of Fellow Employee Claim Exclusion at the
               insured option.

    5.  Contractual Liability Exclusion not to apply to "hired
               car" coverage.

         6.    Notice and Knowledge of Occurrence Provision to be the same as
               found under the Commercial General Liability coverage.

         7.    Coverage to apply to mobile equipment while being
               transported by a covered vehicle.

         8. Trailers to be insured whether or not designed for travel on
               public roads.

  Additional Insured: The State and the Department of Corrections shall
  be additional insured as their interest may appear.

III.     OTHER PROFESSIONAL LIABILITY

Professional  liability  insurance  with minimum  limits of $3,000,000 combined
single limit shall be required for providers




<PAGE>



of professional services who may include, but need not be limited
to, the following:

1.          Teachers                             4. Nurses
2.          Social Workers                       5. Lawyer
3.          Doctors                              6. Consultant

Additional Insured: The State and the Department of Corrections
shall be additional insured as their interest may appear with
respect to the operations of the Contractor.

IV. PROPERTY

           1.     Building and Contents

                  a.   Coverage should apply on a blanket basis and with an
                       Agreed Amount Clause.

                  b.   Perils are to be insured on an "All Risk" basis.

                  c.   Replacement  cost  coverage  should apply to all building
                       and  contents;  vehicles  parked  within the  confines of
                       their service center(s),  fire stations, or normal garage
                       locations are to be included.

d.    The deductible should apply per occurrence.  All deductibles
      or self- insured retention levels shall be reviewed for
      financial adequacy.

e.    Coverage to allow insured to rebuild destroyed building on
      another site.

f.    Full policy limits to apply to glass losses involving  catastrophic losses
      (i.e., fire, explosion, windstorm, etc.)

2.       Time Element

         a.    Combined business interruption and extra expense coverage with
               limits of $100,000 is desired on a blanket all-risk basis.

                  b.     Coverage should include an Agreed Amount Clause.

V.      MOBILE EQUIPMENT FLOATER

        1. Coverage should be All Risk including flood and water
           damage.

        2. Coverage should continue in force if property is loaned
           or rented.





<PAGE>



         3. Coverage should be on a replacement cost basis with no
            co-insurance requirement.

4.      Coverage to automatically apply to newly acquired equipment,
        subject to a maximum limit of $1,000,000 and reporting of such
        acquisition within 90 days.

VI.      ELECTRONIC EQUIPMENT/DATA PROCESSING

           1.     Coverage in the form of an All Risk Data Processing System
                  Equipment policy or equivalent.

2.      Coverage is for data processing systems, including equipment
        and component parts with replacement Value.

3.      Coverage should be broadened to include the additional perils
        of:

        a.   Accidental erasure;

        b.   Electronic and magnetic injury;

        c.   Mechanical breakdown;

        d.   Change in temperature;

        e.   Dryness and dampness of atmosphere;
        f. Transit coverage.

4.      Valuation will be on a replacement cost basis with either no
        Co-Insurance Clause or an Agreed Amount Endorsement.

5.      Media reconstruction, including extra expense, should be
        included to a limit of $100,000.

VII.       VALUABLE PAPERS

           1.     All Risk Valuable  Papers coverage (other than data processing
                  media)  with  blanket  limits of $100,000  for all  locations.
                  Coverage  should  apply  to   reconstruction  of  the  insured
                  records.

2.      Coverage to include transit coverage.

3.     No provisions requiring storage in vault, safe or metal
cabinet.






<PAGE>



4.      Exclusion relating to loss of property not specifically
declared if such property cannot be replaced with other of like kind
to be eliminated.



VIII.        BOILER & MACHINERY

             1.     "Broad Coverage" for mechanical, electrical and air
                    conditioning equipment.

             2.     Limits  should  equal  loss  to  property  of  the  insured.
                    Contamination  should be covered,  as well as extra expense,
                    business interruption,  consequential loss, and off-premises
                    power/utility service loss should be provided.

           3.     Coverage should be on a repair or replacement basis.

           4.     Expediting expenses should be covered with a minimum
                  limit of $25,000.

IX.      EMPLOYEES BLANKET BOND, DISAPPEARANCE, DESTRUCTION AND
         DISHONESTY

1       . Employee  Blanket Bond  (fidelity) and crime coverage shall be for all
        employees  and officials  for a minimum  limit of  $1,000,000.  Coverage
        should apply to terminated  employees and officials for ninety (90) days
        following termination.

         2.     Coverage is to include third party funds in the custody of
                the Contractor.

X.       WORKERS' COMPENSATION

                  Statutory benefits must be provided, plus Employer's Liability
                  minimum limit of $1,000,000.



<PAGE>









ATTACHMENT #9



                        ARIZONA DEPARTMENT OF CORRECTIONS
                                   DEFINITIONS
                          TYPES OF WRITTEN INSTRUCTIONS



Written  Instructions - The primary  method for  management to  communicate  its
philosophy,  mission and expectations to employees,  inmates and the public. The
following are the only written  instructions  authorized for  development  after
January 1995.

Department Orders

         The highest level of written  instruction  within the Department issued
         under the  Director's  signature and uniformly  numbered and formatted.
         These  written  instructions  cross  organizational  lines to guide the
         administration and operation of the Department.

Technical Manuals

         Written  instructions  issued by Assistant Directors by exception only.
         Technical  Manuals are limited to cases in which a written  instruction
         affects ONLY ONE Division.  They typically apply to a limited number of
         employees  in highly  specialized  areas,  providing  a level of detail
         unnecessary to the majority of employees. Technical Manuals shall:

Not place responsibility or requirements on any other Division.  Be specifically
required by the Department Order.
Be  consistent  with the  Department  Order.  Be  uniformly  formatted  for each
Division.
Reflect the subject of the authorizing  Department Order. Be numbered consistent
with the Department  Order.  Divisions may add alphanumeric  designations to the
end of the number to facilitate identification, access and retrieval.

Institutional Orders





<PAGE>



         A written instruction issued under a Warden's or Community Correctional
         Center  (CCC)  Administrator's  signature  to address  issues/practices
         unique to the institution or CCC.
         Institutional Orders shall:

Be developed  only when  authorized by a Department  Order.  Be consistent  with
higher level  instructions.  Be formatted in  accordance  with the  Department's
standardized format. Reflect the subject of the authorizing Department Order.

Be numbered in accordance with the Department's  standardized  numbering system.
Institutions  may add  alpha-numeric  designations  to the end of the  number to
facilitate identification, access and retrieval.

Post Orders

         Written  instructions  signed by a Deputy  Warden or CCC  Administrator
         that provide a detailed description of all responsibilities, duties and
         functions of a particular  post/work  assignment,  to include  specific
         procedures for carrying out activities. Post Orders shall:

Be consistent with all higher level instructions.  Be written for all identified
posts.  Be  consistently  numbered and titled from  institution to  institution,
although content will vary to reflect local operations.



<PAGE>









ATTACHMENT #10



PER DIEM RATES AND SLIDING SCALE



PER DIEM RATES

RTC:     $29.35 per bed, per day for all 200 beds regardless of
         occupancy

DUI:     $35.40 per inmate, per day based on 100% occupancy, as per
         Sliding Scale shown below



                                  SLIDING SCALE
                       TO BE USED FOR DUI PER DIEM PAYMENT



OCCUPANCY LEVEL

100%          99%        9 B,/o       97%      96%        95%        94%

TOTAL INMATES ASSIGNED

400 - 397   96 - 393   392 - 389  388 - 385  384 - 381  380 - 377  376 - 373

PAYMENT

$35.40      $35.99     $36.32      $36.66@     $37.01    $37.36    $37.72


ANY OCCUPANCY LEVEL BELOW 94% SHALL BE PAID AT A PER DEEM RATE OF $37.72.



<PAGE>









ATTACHMENT #11



                         SUSPENSION OR DEBARMENT STATUS
                                  CERTIFICATION


By signing this certification,  the offeror certifies that the firm, business or
person  submitting  the  offer has not been  debarred,  suspended  or  otherwise
lawfully precluded from  participating in any public  procurement  activity with
any  Federal,  State or Local  Government.  Signing this  Certification  without
disclosing  all  pertinent  information  about a debarment or  suspension  shall
result in rejection of the offer or cancellation  of a contract.  The State also
may exercise any other remedy available by law.



Signature                                 Date



Typed Name and Title of Authorized Representative





<PAGE>









ATTACHMENT #11 Contractor Name:
Correctional Services Corporation
Contract No. DC-PO-PRIV-96/97-6790


Fee Schedule

Contractors are required to provide a per them rate that will cover provision of
ALL required  services.  The  identified  rates must include  amortized  capital
costs.

Type the rates in the spaces provided. Then fill in each expense item's relative
daily cost within each rate.  Ensure the allocated costs include costs for those
specific  services  for each  prison.  For  expenses  not  covered by the budget
hierarchy,  create a title  and  provide  a  description.  Complete  the  Budget
Narrative  worksheets for each expense item to provide  supporting detail and to
reflect calculations used to reach shown costs.

The Fee Schedule must be signed by the authorized signatory where indicated.

Per Diem Rate for RTC beds: $  daily per bed (200 beds)

Per Diem Rate for DUI: $  per day per inmate



         Breakdown of relative daily costs included in the proposed rates:

<TABLE>
<CAPTION>


                  Summary                              Total Daily Cost            Allocated Costs
Object            Object                                   600 Beds             RTC               DUI

<S>                <C>                                      <C>                 <C>                <C> 


  6000            Personal Services                      $
  6010            Regular Employees Compensation         $                       $               $
  6100            Employee Related Expenditures
  6110            Insurance                              $                       $               $
  6150            Retirement                             $                       $               $




<PAGE>



  6180            Other Employee Benefits                $                       $               $
  6200            Professional and Outside Services
  6250            Financial                              $                       $               $
  6270            Institutional Care                     $                       $               $
  6290            Legal                                  $                       $               $ 
  6310            Medical and Hospital Services                                  $               $
  6470            Other                                  $                       $               $
  6500            Travel--In State
  6510            Public Transportation
  6540            Non-Public Transportation
  6580            Subsistence                            $                       $               $
  6590            Miscellaneous                          $                       $               $
  6600            Travel--Out-of-State
  6610            Public Transportation                  $                       $               $
  6640            Non-Public Transportation              $                       $               $
  6680            Subsistence                            $                       $               $
  6690            Miscellaneous                          $                       $               $
  6700            Food
  6710            Perishable                             $                       $               $
  6730            Non-Perishable                         $                       $               $
  6750            Miscellaneous                          $                       $               $
  6996            Payments to State Inmates              $                       $               $
  7000            Other Operating Expenditures
  7010            Advertising                            $                       $               $
  7020            Depreciation Expense                   $                       $               $
  7030            Postage Delivery Services              $                       $               $
  7040            Telecommunications                     $                       $               $



<PAGE>



  7050          Insurance                                $                       $               $
  7100          Lease/Rental--Land & Buildings           $                       $               $
  7120          Lease/Rental--Data Processing            $                       $               $
                         Equipment
  7140          Lease/Rental--Vehicles                   $                       $               $
  7180          Lease/Rental--Other Machine and          $                       $               $
                         Equipment
  7310          Printing and Photography                 $                       $               $
  7510          Repair/Maintenance--Non-Contract         $                       $               $
  7540          Repair/Maintenance--Contract             $                       $               $
  7570          Operating Supplies                       $                       $               $
  7670          Repair & Maintenance Supplies            $                       $               $
  7710          Resale Supplies                          $                       $               $
  7850          Utilities & Related Expenditures         $                       $               $
  7960          Miscellaneous (Include interest          $                       $               $
                         expense here)
  7975          Books & Related Expenditures             $                       $               $
  7989          Educational/Training/Etc.                $                       $               $
  8100          Land                                     $                       $               $
  8200          Buildings
  8210          Non-Movable                              $                       $               $
  8230          Movable                                  $                       $               $   
  8300          Improvements Other Than Buildings
  8340          Library and Museum Acquisitions          $                       $               $
                        (Law Library)
  8390          Miscellaneous Improvements Other
                        Than Buildings                   $                       $               $




<PAGE>



8400            Machinery and Equipment
8410            Data Processing Equipment                $                       $               $
8420            Software                                 $                       $               $
8430            Motorized Vehicles                       $                       $               $
8450            Other Machinery & Equipment              $                       $               $
8550            Other Capital Outlay                     $                       $               $

                                     TOTALS:             $                       $               $


</TABLE>

Authorized Signatory




<PAGE>









Contractor. Correctional Services Cooperation



ersona     erv.@ices,



Summary Object 6010



Name of Private Prison: Arizona State Prison-Florence West



                       Contract No: DC-OP-PRIV-96/97-6790

                               BUDGET NARRATIVE I

Instructions:  On the following  pages,  the  Contractor  shall provide  written
narratives  for each  summary  object  code  shown as a cost  factor  on the fee
schedule.  Calculations  provided  via the  budget  narrative  shall  ultimately
breakdown  to the total daily costs shown on the fee  schedule.  Contractor  may
computerize the Budget Narrative forms; however,  format and content must remain
unchanged.



 .11,

 . ..........I
Summary  object 6010 Regular  Employees  Compensation  List  proposed  staff and
accompanying monetary costs.


Position Title



                                       FTE





<PAGE>





Base



Shift Differential



Total Payroll

Contractor:                Correctional Services C

                         ....... .. I'@..@ ......



                                       FTE



Base



Shift Differential



Total Payroll

Contractor: Correctional Services Corporation



                               BUDGET NARRATIVE I
                         (Duplicate pages as necessary)



Page _ of



Instructions:   In the space provided, identify all costs included
in the specified summary object code(s).  Any calculations
provided shall al1 ultimately breakdown to the total daily costs
shown on the fee schedule.  It is understood, that if a summary
object code is not explained in the Budget Narrative, the




<PAGE>



Contractor has not identified that summary object as a cost factor iii the fee
schedule.



Duplicate this page as needed



                    ...cI
summary     object odes 6110 through 6180



      :.: :1@: I 11:

:11,Object Codes'6250 through 6470



Summary Object Codes 6510 through 6590

Contractor:



Correctional Services Corporation



                               BUDGET NARRATIVE I
                         (Duplicate pages as necessary)



Page _ of



Instructions:  In  the  space  provided,  identify  all  costs  included  in the
specified  summary object code(s).  Any  calculations  provided shall ultimately
breakdown to the total daily costs shown on the fee schedule.  It is understood,
that if a summary  object code is not  explained  in the Budget  Narrative,  the
Contractor has not identified  that summary object as a cost factor- iii the fee
schedule.



 .11...................@.111,




<PAGE>



Summary Object 6610 through 6690

Summary Object Codes 6710 through 6750

Contractor: Correctional Services Corporation



                               BUDGET NARRATIVE I
                         (Duplicate pages as necessary)



Page _ of



Instructions:  In  the  space  provided,  identify  all  costs  included  in the
specified  summary object code(s).  Any  calculations  provided shall ultimately
breakdown to the total daily costs shown on the fee schedule.  It is understood,
that if a summary  object code is not explain ' d in the Budget  Narrative,  the
Contractor has not  identified  that summary object as a cost factor- in the fee
schedule.



Payments to state inmates (WIPP)



IL summary Object
701 through 7989

Contractor: Correctional Services Corporation




<PAGE>




Page     of


                               BUDGET NARRATIVE I
                         (Duplicate pages as necessary)



Instructions:  In the space  provided,  identify all costs  included in the
specified  summary object code(s).  Any  calculations  provided shall ultimately
breakdown to the total daily costs shown on the fee schedule.  It is understood,
that if a summary  object code is not  explained  in the Budget  Narrative,  the
Contractor has not identified  that summary object as a cost factor- iii the fee
schedule.



 Summary



<PAGE>



Contractor: Correctional Services Corporation



                               BUDGET NARRATIVE I
                         (Duplicate pages as necessary)



Page _ of





<PAGE>









                         (Duplicate pages as necessary)

Instructions:  In  the  space  provided,  identify  all  costs  included  in the
specified  summary object code(s).  Any  calculations  provided shall ultimately
breakdown to the total daily costs shown on the fee schedule.  It is understood,
that if a summary  object code is not  explained  in the Budget  Narrative,  the
Contractor  has not  identified  that summary object as a cost factor in the fee
schedule.


Summary object  410 through 8450


Contractor: Correctional Services Corporation



                               BUDGET NARRATIVE I
                         (Duplicate pages as necessary)



Page _ of



                         (Duplicate pages as necessary)

Instructions:  In  the  space  provided,  identify  all  costs  included  in the
specified  summary object code(s).  Any  calculations  provided shall ultimately
breakdown to the total daily costs shown on the fee schedule.  It is understood,
that if a summary  object code is not  explained  in the Budget  Narrative,  the
Contractor has not identified  that summary object as a cost factor- iii the fee
schedule.



Authorized Signatory



Date

ATTACHMENT #13





<PAGE>





                    LEGAL DESCRIPTION FOR SECURE PRISON SITE
               (TO BE PROVIDED BY CSC PRIOR TO CONTRACT EXECUTION)

ATTACHMENT #14



                     NEGOTIATION PARAMETERS FOR PURCHASE OF
                                  SECURE PRISON



PURCHASE AGREEMENT

                                    RFP #6702
                PRIVATIZATION OF 200 RTC AND 400 DUI PRISON BEDS



                           NEGOTIATION PARAMETERS FOR
                            PURCHASE OF SECURE PRISON



I.      Formula for Payment

        A.     Land



Cost of Land ($187,000)
(plus) 10% Profit
(minus) Principal Paid via Per Diem



B.       Buildings (Secure Prison)

           Construction  costs  (not to  exceed  $8,313,000)  (plus)  10%
           Profit (minus) Depreciation  (straight line basis over 30 year
           life)





<PAGE>





Depreciation   calculated  in  accordance  with  generally  accepted  accounting
principles and included in CSC's audited financial statements.

The term  "construction  costs"  shall  include  and be  limited  only to actual
expenditures  for  project   architects,   engineers.   and  construction  trade
contractors,  and shall not include any allocation of CSC's expenses for general
overhead, management and finance charges.

C.       Capital Equipment On Site

                  Actual cost of capital  equipment on site at the secure prison
                  pursuant to Article III, Paragraph 3.4.2.

                  (minus) Depreciation

A.G. Contract
No:



                                STATE OF ARIZONA
                          DEPARTMENT OF ADMINISTRATION
                              1700 West Washington
                             Phoenix, Arizona 85007

                               PURCHASE AGREEMENT
                         For the Purchase of Real Estate



This Purchase Agreement is entered into between and among
Correctional Services Corporation (Seller) and

the State of Arizona (State) by the Department of Administration
(DOA) for and on behalf of the Department
of Corrections (ADC).



IN WITNESS  WHEREOF,  the  parties  hereto  agree to carry out the terms of this
Agreement.







<PAGE>



CORRECTIONAL SERVICES CORPORATION



Signature of Authorized Individual         Date
James F. Slattery
Typed Name
President, Chief Executive OfficeR
Typed Title
1819 Main Street
Suite 1000
Sarasota.  Fl
Address

           ESCROW COMPANY


Signature                                    Date

Typed Name

Typed Title


Address



  ARIZONA DEPARTMENT OF ADMINISTRATION


  Signature of Authorized Individual     Date
  Rudy Serino
  Typed Name
  Director
  Typed Title
  1700 West Washington Street, State Capitol
  West Wing, Room 601
  Phoenix, Arizona 85007
  Address

  ARIZONA DEPARTMENT OF CORRECTIONS


  Signature                              Date
  Terry L. Stewart
  Typed Name
  Director
  Typed Title
  1601 West Jefferson




<PAGE>



  Phoenix, Arizona 85007



Address



Approved as to form this         day of         , 19


                                   GRANT WOODS
                              The Attorney General



                              By:
                              Assistant Attorney General


A.G. Contract                     WITNESSETH
Page -1
No: xxxx



     WHEREAS,  Arizona Revised Statute 41-379.02  authorizes DOA to acquire real
property and buildings on behalf of the State of Arizona, and

     WHEREAS,  the ADC did issue Request for Sealed  Proposal  (RFP) Number 6702
for the  privatization  of 600 prison beds wherein it was described that the ADC
would have an option to  purchase  said  private  prison  during the term of the
Contract, and

     WHEREAS,  Correctional  Services  Corporation  (Seller)  did respond to RFP
Number  6702 and was  subsequently  awarded  a  contract  for the  construction,
operation  and  management  of the  private  prison and did agree to the State's
option to purchase prison facility under certain terms and conditions to include
the land, buildings, all fixtures, furniture, equipment and chattel




<PAGE>



hereinafter  referred  to  as  the  "Property"  and  further  described  on
Attachment #1, and

     WHEREAS,  the ADC did receive a  Legislative  appropriation  to acquire the
Property which is known as the Arizona State Prison-Florence West (ASP-FW), and

     WHEREAS,  all obligations of DOA to consummate the transactions  authorized
by this Agreement are contingent on the fulfillment of the conditions  contained
herein,  including,  but not limited to, the  following:  obtaining  clear title
together  with  all  appurtenances;   Seller's  performance  of  all  conditions
precedent of this Agreement and the issuance of an ALTA Extended Title Insurance
Policy, payable in accordance with paragraph 14 of this Agreement,

     NOW,  THEREFORE,  in  consideration of the Property and mutual promises and
undertakings  contained herein,  and for other good and valuable  consideration,
the parties hereto agree as follows:



<PAGE>










A.    G. Contract
No:



CONTINUATION SHEET



'-Page 2



I .     Sale of the Property



1. The  Seller  hereby  sells to the State and the  State  hereby  buys from the
Seller all rights,  title and interest in the Property,  subject to the terms of
this Agreement.

2. The "Purchase  Price" The  "Purchase  Price" shall be . which is inclusive of
all costs for the land, buildings,  fixtures and capital equipment, except those
costs  that  are  otherwise  identified  herein.  The  Purchase  Price  shall be
negotiated  in  accordance  with the  parameters  outlined  within the Agreement
between the ADC and Correctional Services Corporation (Seller).

3. WARANTIES OF THE SELLER: The Seller warrants, represents,  covenants and
acknowledges  (with  the  understanding  that  the  State  is  relying  on these
warranties   representations,   covenants  and  acknowledgments  and  that  such
warranties,  representations,  covenants and  acknowledgments  shall survive the
closing) that (i)




<PAGE>



equipment,  fixtures,  furniture,  materials and chattels  located at ASP-FW and
utilized to operate the prison by  Correctional  Services  Corporation  (Seller)
ninety (90) days in advance of the  Seller's  receipt of notice of the intent of
ADC to  exercise  its  option to  purchase  the  Property  shall  remain in good
condition,  accepting  normal wear and tear and shall be available to the ADC at
time of the  purchase;  and (ii) except as  reflected in the  Preliminary  Title
Report at the time of execution of this Agreement;

a.    Seller can  deliver fee title for the land to the State  through  warranty
      deed to the  Property  without  encumbrances,  on the Close of Escrow,  as
      defined hereinafter.

b.    That there are no claims, actions, suits, or other proceedings
      pending or to the best of Seller's knowledge threatened by any
      governmental department or agency or any other corporation,
      partnership, entity or person (as defined in A.R.S. 1-215)
      whomsoever ("Person"), nor any voluntary actions or
      proceedings contemplated by Seller, which in any manner may
      detrimentally affect the State's right, title or interest in
      and to the Property or the value of the Property or Seller's
      ability to perform Seller's obligations under this Agreement.

      c. That no person is in adverse  possession  of the Property and there are
      no  persons  who have  been  granted  any  license,  lease or other  right
      relating to the use or possession of the Property  other than those listed
      on Attachment #2.



<PAGE>









A.G. Contract

No:                            CONTINUATION SHEET




      d. That there have been no written  modifications of those agreements that
      allow other  Persons to access the  Property  other than those  agreements
      that  have  been  provided  to the  State.  The  Agreements  have not been
      modified by any oral  agreements.  Seller shall  provide an  assignment of
      existing agreements to the State.

        e. That  there are no  pending  or  threatened  condemnation  or similar
        proceedings  affecting any part of the Property,  and the Seller has not
        received any notice of any such proceeding and has no knowledge that any
        such proceeding is contemplated.

f.    That no work is in progress at the  Property  and no  materials  have been
      furnished to the Property which might 'give rise to  mechanic's,  material
      man's or other liens against the Property.

      g.          That the Seller is not prohibited from consummating the
      transactions contemplated by this Agreement by any law, regulation,
      agreement, instrument, restriction, order
      or judgment.

h.    That there are no attachments,  executions, assignments for the benefit of
      creditors,  receiverships,  conservatorship  or voluntary  or  involuntary
      proceedings  in  bankruptcy  or  pursuant  to any other laws for relief of
      debtors  contemplated,  filed by or pending against Seller or any entities
      related to Seller  which might affect or involve the  Property,  except as
      described on Attachment #3.

i.    That  there is no  default,  nor has any  event  occurred  which  with the
      passage of time or the giving of notice or both would constitute a default
      in any contract, mortgage, deed of trust, lease, or other instrument which
      related  to the  Property  or which  affects  the  Property  in any manner
      whatsoever, except as described on Attachment #4.

j.    That there are no contracts or other obligations outstanding for
      the sale, exchange, or transfer of all or any part of the Property.

      k. That the Seller has taken all actions necessary to protect and preserve
      all water  rights with respect to the  Property  and shall  provide  water
      rights assignments to the State.





<PAGE>





I.    That Seller shall have  performed  fully and complied with the  agreements
      required to be performed  or complied  with by it prior to or at the Close
      of Escrow,  including  satisfaction of the  requirements  contained in the
      "Requirements"  section of Schedule  "B" of the  Preliminary  Title Report
      referred to in paragraph 11(a) of this Agreement.

m.    That Seller has not and will not at any time prior to Close of
      Escrow grant to any
      person an interest in the Property.

4.       Escrow Company:

a.  An escrow shall be opened by either party with (the "Escrow
Company").




<PAGE>









A.G. Contract
No:



CONTINUATION SHEET



--,Page 4



      b. By countersigning  this Agreement,  the Escrow Company,  by and through
      its duly authorized  representative,  hereby accepts this  transaction and
      agrees to act as the Escrow Company in connection with this Agreement.

     5.  Close of escrow  shall be on , or as soon  thereafter  as escrow can be
closed. Both parties shall use their best efforts to have the Close of Escrow on
the specified date.

     6.  Possession  and title of the Property shall pass from the Seller to the
State on the date that Close of Escrow occurs.

     7. Payment:  On or before the date of Close of Escrow,  the State shall pay
to the  Escrow  Company  the  Purchase  Price as shown in  Paragraph  2. of this
Agreement.  The Escrow Company shall release the funds to the Seller on the date
of Close of Escrow. 8.

     8. Documents and Escrow:  All documents  necessary to close escrow shall be
deposited in escrow with the Escrow Company by the appropriate party.  Except as
otherwise provided, in this Agreement, the Seller and the State agree to execute
all  documents,  including,  but not limited to, the documents and deeds in this
Agreement or otherwise necessary to close this transaction, in the standard form
used by the Escrow Company, except that the Seller and the State hereby instruct
the Escrow  Company to modify  such  documents  to the  extent  necessary  to be
consistent with this Agreement and to be incompliance with Arizona law.





<PAGE>



     9. Evidence  Title to the Property shall be conveyed by warranty deed which
shall  specifically  reference  all of the ground  water and the  surface  water
rights  which are  appurtenant  to the  Property  and on file  with the  Arizona
Department  of Water  Resources.  The title shall be in the name of the State of
Arizona by and through the DOA.

     10. Joint Committee of Capital Review ((JCCR) Approval Required: T he S t a
t e ' s  obligation  to perform  under this  Agreement is  conditioned  upon the
approval  of the  JCCR.  The DOA  shall  use its  best  efforts  and  shall  act
diligently and take all steps necessary to obtain the approval and to consummate
the transaction.




<PAGE>









A.G. Contract
No:



CONTINUATION SHEET



--Page 5



     11.  Contingencies  required to be met by Seller: The State's obligation to
consummate this transaction and to fulfill the obligations  under this Agreement
is subject to the satisfaction of the following conditions precedent:

a.    Title Insurance and ALTA Survey

     Preliminary  Title  Report:  ' Within ten (10) days after the  receipt of a
copy of this Agreement by the Escrow  Company,  the Escrow Company shall provide
the State a current  conunitment for the title insurance (the "Preliminary Title
Report")  disclosing  all  matters of record and other  matters  about which the
Escrow Company has knowledge and a legible copy of each of the  instruments  and
documents  referred to in the  Preliminary  Title  Report.  The State shall have
fourteen  (14) days  after  receipt  of the  Preliminary  Title  Report  and the
instruments and documents referred to therein to object in writing to the Seller
to any matter shown thereon. If the State objects to any matter disclosed by the
Preliminary  Title  Report or any  amendment  thereof,  the Seller  shall either
rescind the Escrow Agreement on or before five (5) days prior to Close of Escrow
or shall have until the date of Close of Escrow to cause to be removed  any such
objected matter from the  Preliminary  Title Report and any amendment and policy
of title  insurance  to be issued in favor of the State.  If the Seller does not
rescind or remove the  objected to matter,  the State may (1) waive such default
and close  Escrow;  (2) may  institute  an action for  specific  performance  or
damages; or (3) may exercise any other rights available to it by law or equity.





<PAGE>



ii. Title  Policy:  The Seller  shall  furnish to the State an owner's ALTA
extended  title  insurance  policy for the full amount of the purchase  price as
shown in  paragraph 2 of this  Agreement to be paid for as provided in paragraph
14 of this  Agreement,  which shall be issued by the Escrow Company showing good
and  marketable   title  to  the  Property,   free  from  defects,   claims  and
encumbrances, except as follows: (1) restrictive covenants of record; (2) zoning
regulations;  (3) easements and rights-of way of public  utilities;  (4) printed
exceptions  contained in the Owner's ALTA extended title insurance  policy;  and
(5) any matters contained in the Preliminary Title Report and not objected to by
the State  pursuant to  paragraph  1 1 (a)(i)  above.  If title to the  Property
otherwise is  defective at the Close of Escrow,  the State may elect at its sole
option,  either to accept  title  subject to  defects  which are not cured or to
cancel this Agreement.

b.  Survey:  Seller  shall  provide  the  State  with a  certified  ALTA  survey
("Survey")  of the  Property no later than sixty (60) days prior to the Close of
Escrow setting forth an accurate legal  description of the land contained within
the  Property  and showing  the  location  of the  precise  boundaries  thereof,
together  with the  improvements,  utilities  and any  other  structures  on the
Property  and all  easements,  encroachments,  rights-of-way  and other  matters
affecting or appurtenant to the Property, whether recorded, visible or otherwise
known to exist.  The DOA shall  approve the  surveyor  prior to the survey being
performed.  The area of the Property shall be set forth on the survey.  The cost
for the survey shall be paid for as provided in paragraph 14. of this Agreement.



<PAGE>









A.G. Contract
No:



CONTINUATION SHEET



@.-Page 6



c.  Examination of Property:  The Seller shall pen-nit access to the Property by
the State and/or its agents upon  reasonable  advance notice to the Seller prior
to Close of Escrow,  to conduct,  prepare and  perform any  studies,  surveys or
reports upon the Property that the State deems  necessary and for the purpose of
a visual inspection and/or testing to determine, to the State's satisfaction, if
there are any hazardous wastes,  or other pollutants,  on the Property in excess
of the  standards  set  forth in  federal  or state law or  regulations.  If any
possible hazardous wastes or other pollutants, are found, whether through visual
inspection,  testing or otherwise,  the State may be required to disclose  these
findings to third persons under the public  disclosure  laws,  and will disclose
them  to  the  appropriate   federal  and  state  agencies  concerned  with  the
enforcement of environmental laws and regulations.  Access to the property shall
not interfere with the on-going business  operations on the Property.  The right
to inspect the Property  shall not diminish nor nullify the Seller's  warranties
or  indemnification's  as set  forth  in  this  Agreement.  The  State  will  be
responsible  for any  reasonable  damages,  but no de  minimis  damages,  to the
Property caused by it during any access to the Property under this paragraph.



     12. Water Rights.  Non-foreign  Affidavit and Lease assignment:  The Seller
shall provide the documents  listed below to the Escrow  Company at least twenty
(20) days prior to Close of Escrow for review and approval by the State.  If the
State does not receive the documents by such time, then the State




<PAGE>



shall  have the  right to cancel or  extend  the Close of  Escrow,  without
penalty, at its sole option.

        a.     Assignments of Water Rights
        b.     Non-foreign Affidavit
        c.     Assignment of Leases in form substantially similar to
               Attachment #5.

     13. Taxes:  Taxes due on the Property  through the Close of Escrow shall be
the responsibility of and paid by the Seller.

     14.  Closing  and  Escrow  Costs:  Except  as  otherwise  provided  in this
Agreement,  all closing and other costs shall be prorated between the Seller and
the State in accordance  with local custom and  applicable  laws and rules.  The
Seller and the State  shall share  equally the charge for the ALTA Survey  fees.
The Seller  shall pay the  premium  for the  standard  owner's  title  insurance
policy.  The State  shall  pay,  within the amount of the  Purchase  Price,  the
additional costs of the ALTA extended owner's policy of title insurance.

     15. Broker  Commissions:  Each party  represents  and warrants to the other
that there are no  brokers,  finders  or real  estate  agents or other  entities
involved in this transaction and

A.G. Contract
No:



CONTINUATION SHEET



--,-Page 7







<PAGE>



there shall be no fees,  commissions or other costs to be paid by the State
to any broker,  finder or real estate  agent or other  person(s).  16.  Seller's
Warranties and Maintenance of the Property: Except as otherwise provided in this
Agreement,  the Seller shall  maintain  and repair the Property so that,  at the
time  possession  is  transferred  to  the  State,  the  Property  shall  be  in
substantially  the  same  condition  as on the date  the ADC  authorized  inmate
occupancy of ASP-FW.  The Seller warrants that all heating,  cooling,  plumbing,
septic, electrical systems and roofs will be in working condition on the date of
possession by the State. The Seller warrants that, prior to the Close of Escrow,
payment  in full  will  have  been  made for all  labor,  materials,  machinery,
fixtures or tools furnished within the one hundred twenty (120) days immediately
preceding the Close of Escrow in connection with the construction, alteration or
repair of any structure on or improvement to the Property.  17. Termite  Report;
Treatment  and Repairs:  The parties agree that,  at the Seller's  expense,  the
Seller shall provide the State within  thirty (30) days after  execution of this
document,  a termite  inspection  report by a licensed pest control  contractor,
from  a list  approved  by the  State,  which  describes  the  condition  of the
buildings,  relative  to termite  infestation  and  damages and that such report
shall  show the  buildings  to be free from  current  infestation.  Charges  for
termite  treatment,  if any,  to produce  such  report  shall be paid for by the
Seller. If any damages to the buildings are reported, the State may rescind this
Agreement, or accept the property as described in the termite report. The




<PAGE>



State may give its written notice of which alternative it elects
within thirty (30) days from receipt of the termite inspection
report.

18.     Environmental Law Warranties:

   a.   Use of the Property: The Seller warrants that no
        portion of the Property is now being or has ever been
        used as follows:


A.G. Contract

No:                            CONTINUATION SHEET



---Page 8



     i. In a manner requiring the issuance of a permit covering the discharge or
disposal of a pollutant or waste into any waters,  ground waters,  or aquifer of
the State of Arizona or waters of the United States.

     ii. For the  treatment,  collection,  storage or  disposal  of any  refuse,
objectionable  waste or any material in a manner  inconsistent  with  applicable
federal, state or local law.

     iii. For the generation,  transport,  treatment, storage or disposal of any
hazardous  waste  subject  to  regulation  under  the  Arizona  Hazardous  Waste
Management  Act, A - R - S. 49-921 et seq.,  or the  Resource  Conservation  and
Recovery Act, 42-U. S. C., 6901 et seq.

     iv. For the  manufacture,  processing,  distribution  in commerce,  use, or
disposal of any toxic substance subject to regulation under the Toxic Substances
Control Act, 15 U.S.C. 2601 et. seq.

     v. For any  underground  storage  tank  subject to  regulation  pursuant to
A.R.S. 491 00 I et. seq. or 42- U. S. C. 6991 a et. seq.





<PAGE>



     vi. For any injection  well, dry well, or any similar  facility  subject to
regulation pursuant to A.R.S. 49-331 et. seq. or the Safe Drinking Water Act, 42
U.S.C. 300f et seq.

     vii. In a manner  requiring  compliance  with the  Emergency  Planning  and
Community  Right  to Know  Act of  1986,  42 U. S. C 1 1 00 I  through  1 1 050,
including,  but not limited to, the duty to prepare material safety data sheets,
emergency and hazardous  chemical  inventory  forms and toxic  chemical  release
forms.

     viii. In any manner requiring  compliance with the Clean Air Act, 42 U.S.C.
7401 through 7640,  including  laws and  regulations  relating to asbestos,  42-
U.S.C.  7412  through  7414;  and 40 Code of Federal  Regulations,  Part 61. The
Seller warrants that no asbestos-containing material is located on, in or within
the Property which is the subject of this sale.

     b.: The Seller warrants that there is no current and there has been no past
release or substantial threat of a release of a hazardous substance,  pollutant,
or  contaminant  from or onto the  Property or the  environment  adjacent to the
Property  that are or may be subject to  regulation  under  applicable  federal,
state or local law, or that may make the State liable in tort under a common law
public or private nuisance action.

     c. Pending  Investigation or Lawsuit:  The Seller warrants that to the best
of the  Seller's  knowledge,  no portion  of the  Property  is the  subject of a
threatened or pending  investigation or lawsuit or administrative  action by any
person, firm,  governmental body or other entity relating to or arising from any
matter of circumstance subject to regulation described in subparagraphs 17 a. or
b. above and the Seller has received no official notice of any alleged violation
of any applicable federal, state or local environmental law.

A.G. Contract

No:                            CONTINUATION SHEET



--.-Page 9



     d. environmental Laws:





<PAGE>



Seller's  knowledge,  the Property and all the  operations  on the Property
comply  fully  with  all  federal,   state  or  local   environmental  laws  and
regulations. The Seller warrants that to the best of

     e. Seller's Activities and Use: The Seller warrants that the Seller and its
employees,  agents,  lessees and users,  have not engaged in nor  permitted  any
operations on or activities upon or any use or occupancy of the Property for the
purpose  of  or  involving  the  handling,  treatment,  storage,  use,  release,
discharge,   refining,  dumping  or  disposal  of  any  substance  described  in
subparagraphs  18 a. and b. above,  on,  under,  in or about the  Property,  nor
transported  any such  substances  to, from or across the Property,  nor has the
Seller,  its agents,  employees  or lessees  constructed,  deposited,  stored or
otherwise located such substances on, under or about the Property.

     f. Indemnity : The Seller shall indemnify and hold harmless the State,  its
employees,  and agents  from and  against  any and all loss,  damage and expense
(including,  but not limited  to,  reasonable  investigation  and legal fees and
expenses)  including,  but not  limited  to,  any  damages,  claim or action for
injury,  liability  or damage to persons or  property,  and any and all damages,
claims or  actions  brought  by any  person,  firm,  governmental  body or other
entity,  alleging or resulting or arising from or in connection with a breach of
any of the foregoing environmental law warranties.

     g. Survival : All warranties,  agreements, and indemnification's  contained
in  subparagraphs  a.  through f. above shall  survive the Close of Escrow,  and
shall run to the State's successors, assigns, and subsequent purchasers.

     h. Environmental Conditions: Notwithstanding other termination clauses in
this Agreement,  the State, if it is dissatisfied  with the  environmental  data
known,  or which may become known,  to it, may cancel this Agreement to purchase
the Property by giving written notice thereof.

     19.  Risk f Loss:  If there  is any loss or  damage  to  persons  or to the
Property  between  the date of this  Agreement  and the Close of Escrow,  by any
reason, including but not limited to fire, vandalism,  flood, earthquake, act of
God, negligence,  willfulness or recklessness,  the risk of loss shall be on the
Seller.




<PAGE>



     20. Cancellation:  Any party who elects to cancel this Agreement because of
any breach by another  party,  and who is not itself in breach of this Agreement
except for any breach occasioned by a breach by the other party, may cancel this
Agreement  by  delivering  to the  Escrow  Company  a notice  stating  that this
Agreement  shall be  canceled  unless the  breach is cured  within ten (10) days
following  the delivery of the notice to the other party.  Within three (3) days
after receipt of such notice, the Escrow Company shall



A.G. Contract

No:                           CONTINUATION SHEET



Page 10



forward  the  notice by United  States  mail to the party in breach  and no
further  notice  shall be  required.  If the breach is not cured within ten (10)
days  following  the delivery of the notice to the other party,  this  Agreement
shall be canceled  and the  breaching  party  shall be liable for all  customary
escrow cancellation charges. If this escrow fails to close for any other reason,
the  Seller and the State  shall  each be liable  for one half of all  customary
escrow cancellation charges.

     21.  Survival:  This Agreement  shall survive the Close of Escrow as to any
terms, conditions,  agreements, warranties, or representation which are to apply
thereafter.




<PAGE>



     22. Successors and Assigns:  This Agreement shall be binding upon and inure
to the  benefit of the  parties  hereto  and their  respective  heirs,  personal
representatives, successor-in-interest and assignees.

     23. Notice:  All notices,  requests,  demands,  consents,  approval and any
other  communications  which may or are required to be served or given hereunder
(for the purposes of this provision collectively called "Notices"),  shall be in
writing  and shall be sent by  certified  United  States  mail,  return  receipt
requested,  postage  prepaid,  addressed to the party or parties to receive such
notice as such  addresses  appear on the signature  page of this Agreement or to
such other address as either party may from time to time furnish in writing,  to
the other by notice hereunder. Any notice so mailed shall be deemed to have been
given as of the date such notice is received on the return receipt. Furthermore,
such notice may be given by  delivering  personally  such notice to the State to
the below  listed  individuals  or to such other person as either party may from
time to time designate in writing to the other by notice  hereunder.  Any notice
so  delivered  shall be deemed to have been given as of the date such  notice is
personally delivered to the other party.

Notices to be delivered to:

A.G. Contract
No:                         CONTINUATION SHEET






<PAGE>



   Department of Administration          Department of Corrections
   Assistant Director                    Assistant Director
   General Services                      Administrative Services



I Page 1 1



Correctional Services Corporation (Seller)
President, Chief Executive Officer



     24. Time:  Unless otherwise  indicated,  all periods of time referred to in
this  Agreement  shall refer to calendar days and shall  include all  Saturdays,
Sundays, and state or national holidays,  provided that if the date or last date
to perform any act or give any notice with respect to this Agreement  shall fall
on a  Saturday,  Sunday or state or national  holiday  such act or notice may be
timely  performed or given on the next  succeeding  day which is not a Saturday,
Sunday or state or national holiday.

     25. Headings: Headings are for convenience only and are not to be construed
as part of this Agreement.

     26.  Invalidity  of a Term:  The parties  agree that in the event any term,
covenant or condition herein contained should be held to be invalid or void, the
invalidity  of any such term,  covenant or condition  shall in no way affect any
other term, covenant or condition of this Agreement.

     27. Conflict of Interest:  The parties  acknowledge  that this Agreement is
subject to cancellation pursuant to A.R. S. 38-51 1, the provisions of which are
incorporated herein.

     28. Prohibition Against  Discrimination:  In the event that it applies, the
parties agree to comply with State Executive Order




<PAGE>



No.  75-5 which  mandates  that all  persons,  regardless  of race,  color,
religion,  sex, age, national origin or political affiliation,  shall have equal
access to employment  opportunities,  and all other applicable Federal and State
laws, rules and regulations, including the Americans with Disabilities Act.

     29.  Maintaining  and Producing  Records:  Pursuant to A.R.S.  35- 214, the
Seller shall retain for inspection  and audit by the State all books,  accounts,
reports,  files, and other records relating to the performance of this Agreement
for a period of five (5) years after A. G. Contract No:



                               CONTINUATION SHEET



-Page 12



its  completion.  Upon  request  by the State,  a legible  copy of all such
records  shall be  produced  by the Seller at the  administrative  office of the
Auditor  General.  The original of all such records  shall also be available and
produced for  inspection and audit when needed to verify the  authenticity  of a
copy.


30.   Governing Law and Venue:





<PAGE>





     30.  Governing Law and Venue:  This Agreement  shall be construed under the
laws of the State of Arizona.  Any  arbitration  or other action  arising out of
this  Agreement,  whether for the  enforcement  thereof or  otherwise,  shall be
brought in Maricopa County, State of Arizona.

     31.  Arbitration:  To the extent  required by A.R.S.  12- 1518, the parties
agree to use arbitration to resolve any dispute arising out of this Agreement in
accordance with Arizona law.

     32. Time is of the Essence: Time is of the essence of this Agreement.

     33.  Authority:  Each person signing this Agreement  warrants that each has
the full power and  authority  to execute  this  Agreement  and  consummate  the
transaction contemplated hereby on behalf of the party each represents.

     34.  Negotiated  Agreement:  This  Agreement is the result of  negotiations
between the parties  and,  accordingly,  shall not be  construed  for or against
either party  regardless  of which party  drafted this  Agreement or any portion
thereof.
 
     35. Entire Agreement: This Agreement, together with its attachments as well
as the Agreement between the ADC and




<PAGE>



     Correctional Services Corporation (Seller) constitutes the entire agreement
between the parties  relative to the purchase of the Property and  supersede any
other written or oral agreement between the parties regarding this matter.

     36. Amendments: This Agreement can be modified only by a written amendment,
signed by all parties.


A.G. Contract
No:



                               CONTINUATION SHEET

                                     Page 13



     37.  Attachments:  The following is a list of the Attachments  which form a
part of this Agreement and,  unless  otherwise  stated herein,  all of which are
incorporated herein by reference as if set forth in full:


     a.  Attachment #1 - Legal  Description of land and buildings,  improvements
and chattel  which make up the Arizona  State  Prison-Florence  West,  otherwise
collectively known as the Property



     b. Attachment #2 - List of Leases, if any

     c.  Attachment  #3 - Listing of Actions that may impact the purchase of the
Property  (attachments,  executions,  assignments for the benefits of creditors,
receiverships,  conservatorship  or  voluntary  or  involuntary  proceedings  in
bankruptcy, etc., filed or pending against Seller.





<PAGE>



     d.  Attachment  #4 - Listing  of  Actions  that have  occurred  that  would
constitute a default in any contract,  mortgage,  deed of trust, lease, or other
instrument which relate to the Property or affect the Property in any manner.

     e. Attachment #5 - Form of assignment of leases, if any


ATTACHMENT #1



DESCRIPTION OF PROPERTY



                                      LAND

Legal Description - 18 Acres (Specific legal description for 18
acres to be added)



                                  SECURE PRISON

This  Agreement  is for the  purchase of a 600 bed,  level 2 (minimum  security)
prison  located  in  Pinal  County  sited on  approximately  18 acres of land as
described above. The secure prison shall be comprised of the following:



1 .     Housing units for 200 Return to Custody Inmates and 400 DUI
        Inmates.

One  200  bed  dormitory  for RTC  inmates  -  23,320  square  feet  Two 200 bed
dormitories for DUI inmates - 46,640 square feet (23,320 square feet each)

2.      Facility Administration building - 34,368 square feet

        Functions:         Administration, kitchen/food service, chapel,
        medical, property, commissary, visitation, intake, central
        control, dining/multi-purpose/indoor recreation, laundry,
        mechanical, classrooms.

3.       Equipment Storage/Maintenance Building - ? square feet





<PAGE>


4.      Utilities City of Florence water, sewer and fire services.
U.S. West provides telephone services and Arizona Public Service
provides electricity.



5.     Paving

Page 2
Attachment #1
Purchase Agreement



Security

The  perimeter  security  system  will  consist  of one  fourteen  foot loop top
perimeter  fence with  "no-climb"  (1/4 inch hardware  cloth) at the top six (6)
feet of the fence on the  inside,  the mesh at the bottom of the fence  shall be
embedded  in a  concrete  base.  Razor  wire on the top of the fence at least at
those points where the perimeter fence abuts to a building. Adequate security to
ensure that inmates  remain within the  perimeter  and to prevent  access by the
general public.

Secure locks on all outside doors.

Perimeter  and site  lighting as required  for  perimeter  and site layout which
meets the operational needs of the prison.



Sallyports - pedestrian and vehicle to control access to and from the
prison.
Closed Circuit Television System
Furniture, fixtures, equipment and chattel