Document:

exv10w1

Exhibit 10.1

CORRECTIONS CORPORATION OF AMERICA

STOCK OPTION CANCELLATION AGREEMENT

     This STOCK OPTION CANCELLATION AGREEMENT (the “Agreement”) is by and between Corrections
Corporation of America, a Maryland corporation (the “Company”), and John D. Ferguson (the
“Employee”).

     WHEREAS, the Employee believes that it is in the best interest of the Company and its
stockholders to voluntarily cancel existing Company stock options held by Employee set forth on
Exhibit A (the “Cancelled Options”) that have relatively low incentive or retention value
at this time so that additional shares become available for grant under the Company’s Amended and
Restated 2000 Stock Incentive Plan and its 2008 Stock Incentive Plan (the “Stock Plans”), which the
Company may use for future equity grants to Company personnel in order to recruit, retain and
motivate such personnel; and

     WHEREAS, the Company is relying upon the Employee’s surrender and cancellation of the
Cancelled Options in making determinations about the future grant of equity awards pursuant to the
Stock Plans and otherwise in regard to the administration of the Stock Plans.

     NOW, THEREFORE, the parties hereby agree as follows:

     Section 1. Cancellation of Options. The Employee hereby surrenders the Cancelled
Options for cancellation, and the Company hereby accepts such surrender and cancellation. By
execution of this Agreement, the parties have taken all steps necessary to cancel the Cancelled
Options.

     Section 2. No Expectation or Obligation. The Company and Employee acknowledge and
agree that the surrender and cancellation of the Cancelled Options described herein shall be
without any expectation of the Employee to receive, and without imposing any obligation on the
Company to pay or grant, any cash, equity awards or other consideration presently or in the future
in regard to the cancellation of the Cancelled Options.

     Section 3. Miscellaneous. This Agreement contains all of the understandings between
the Company and Employee concerning the cancellation of the options. The Company and Employee have
made no promises, agreements, conditions, or understandings relating to this subject matter, either
orally or in writing, that are not included in this Agreement. This Agreement may be executed in
counterparts, each of which when signed by the Company and the Employee will be deemed an original
and all of which together will be deemed the same agreement. This Agreement shall be governed and
construed exclusively in accordance with the law of the State of Tennessee applicable to agreements
to be performed in the State of Tennessee to the extent it may apply.

 

 

[signature page of Stock Option Cancellation Agreement]

     The Company and the Employee have caused this Agreement to be signed and delivered as of the
12th day of August, 2010.

	 	 	 	 	 
	 

	 	CORRECTIONS CORPORATION OF AMERICA
	 
	 	 	 	 
	/s/ John D. Ferguson

	 	By:
	 	/s/ Damon T. Hininger
	 

	 	 	 	 
	 

	 	Title:
	 	President

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Exhibit A

Description of Cancelled Options

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	Grant	 	 	Grant	 	 	Qty	 	 	Qty	 	 	Qty	 	 	Vesting	 
	 	Date	 	 	Price	 	 	Granted	 	 	Vested	 	 	Unvested	 	 	Schedule	 
	 	2/16/07(1)

	 	 	$26.53(3)
	 	 	 	75,504	 	 	 	 	75,504	 	 	 	 	-	 	 	 	One third on the
anniversary date
over a three-year
period.	 
	 	2/20/08(2)

	 	 	$	26.71  	 	 	 	 	90,143	 	 	 	 	60,095	 	 	 	 	30,048	 	 	 	One third on the
anniversary date
over a three-year
period.	 
	 

TOTAL OPTIONS CANCELLED — 165,647

(1) Awarded from the Amended and Restated 2000 Stock Incentive Plan

(2) Awarded from the 2008 Stock Incentive Plan

(3) Adjusted for the 2-for-1 stock split on July 6, 2007

3Exhibit 4.1

Exhibit 4.1

EXHIBIT B

SUBSCRIPTION AGREEMENT

IMPORTANT:

This document contains significant investment representations.

Please read it carefully before signing.

			
	Return to:	 	Digitiliti, Inc.

266 E. 7th Street, 4th Floor

St. Paul, MN 55101

Attention: Roy Bauer

I,                                          [please print or type name of individual/entity
subscriber] (the “Holder”) desire to take the actions as described below upon the terms and
conditions set forth below and as described in the Letter to Holders of Notes and Warrants dated
May
 _____, 2010, including exhibits (collectively, the “Letter”), from Digitiliti, Inc. (the
“Company”).

WHEREAS, the Company issued to the Holder the outstanding Convertible Note(s) as described on
Appendix A (collectively, the “Note”) in connection with a private placement of 12%
Convertible Notes (“Private Placement”).

WHEREAS, in connection with the Note and the Private Placement, the Company issued to the
Holder the outstanding Warrant(s) as described on Appendix A (collectively, the “Warrant”).

1. Conversion of Note. Pursuant to the terms of the Letter, I hereby convert both the
principal balance of the Note and accrued but unpaid interest on the Note, in full, into fully
paid, nonassessable and unregistered shares of either common stock or preferred stock, as
indicated on Appendix A, of the Company equal in number to the principal balance and
accrued but unpaid interest on the Note divided by $.20 per share (the “Note Conversion Price”),
whereby the Note and the Company’s obligations thereunder would be cancelled (the “Conversion”).
The Note Conversion Price reflects an amendment to the existing conversion price of the Note
pursuant to the Letter.

2. Exercise of Warrant. Subject to the full Conversion of the Note as provided under
Section 1, I hereby irrevocably elect to exercise the Warrant (“Exercise”) to purchase the number
of shares of common stock of the Company indicated below at an amended exercise price of $.20 per
share (“Revised Exercise Price”). The Revised Exercise Price reflects an amendment to the existing
exercise price of the Warrant pursuant to the Letter, but only to the extent the Warrant is hereby
exercised. If I do not exercise my Warrant in full, I acknowledge that the existing exercise price
of the Warrant will continue in effect as to the remainder of the Warrant.

	 	 	 	 	 	 	 
	Number of Warrant shares being exercised 	 	_____ shares of common stock
	 	 	 	 	 	 	 
	Aggregate Revised Exercise Price 	 	$	                  
                             

 

 

 

I am enclosing a check payable to “Digitiliti, Inc.” or making arrangements for a wire transfer to
the Company for the Aggregate Revised Exercise Price.

3. Instructions for Subscription Process. I acknowledge that the Incentive Offer, as
defined in the Letter, is available for a limited time and that I must return this Subscription
Agreement, completed and signed, along with the original Note and Warrant being Converted and
Exercised and payment of the Aggregate Revised Exercise Price to the Company for receipt no later
than on or before Wednesday, June 23, 2010.

4. I acknowledge that the Incentive Offer described in the Letter may be terminated or modified by
the Company in its sole discretion. I further acknowledge that this Subscription Agreement is
contingent upon acceptance by the Company, and that the Company has the right to accept or reject
this Subscription pursuant to the terms in the Letter.

5. I acknowledge that I have received and reviewed the Letter relating to the Conversion and
Exercise, and have been given access to and am familiar with current information about the Company
(specifically including risk factors affecting the Company and its current financial information,
which are available on the Company’s website and in its annual, quarterly and current reports,
proxy statements and other information filed with the Securities and Exchange Commission (“SEC”)
and available free of charge at http://www.sec.gov) and have utilized such access to my
satisfaction.

6. I hereby represent that I am an “accredited investor” as that term is defined in Rule 501 under
the Securities Act of 1933, as amended (the “1933 Act”) and am experienced and knowledgeable in
financial and business matters, capable of evaluating the merits and risks of investing in the
Company with respect to the Conversion and Exercise, and do not need or desire the assistance of a
knowledgeable representative to aid in the evaluation of such risks (or, in the alternative, I
have used a knowledgeable representative in connection with the Conversion and Exercise).

a. Accredited Investor — Individuals. I am an INDIVIDUAL and:

	o	 	i. I have a net worth, or a joint net worth together with my spouse, in excess of
$1,000,000. [In calculating net worth, you may include equity in personal property and
real estate, including your principal residence, cash, short-term investments, stock and
securities. Equity in personal property and real estate should be based on the fair
market value of such property minus debt secured by such property.]

	 
	o	 	ii. I had an individual income in excess of $200,000 in each of the prior
two years and reasonably expect an income in excess of $200,000 in
the current year.

	 
	o	 	iii. I had joint income with my spouse in excess of $300,000 in each of
the prior two years and reasonably expect joint income in excess of
$300,000 in the current year.

	 
	o	 	iv. I am an executive officer of Digitiliti, Inc.

 

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b. Accredited Investor — Entities. The undersigned is an ENTITY and:

	o	 	i. The undersigned is an employee benefit plan within the meaning of Title I of the
Employee Retirement Income Security Act of 1974 and one or more of the following
is true (check one or more, as applicable):

o (1) the investment decision is made by a plan fiduciary, as defined in Section
3(21) of such Act, which is either a bank, savings and loan association, insurance
company, or registered investment adviser; or

o (2) the employee benefit plan has total assets in excess of $5,000,000; or

o (3) the plan is a self-directed plan with investment decisions made solely by
persons who are “Accredited Investors” as defined under the 1933 Act.

	o	 	ii. The undersigned has total assets in excess of $5,000,000, was not formed for the
specific purpose of acquiring securities of the Company and is one or more of the
following (check one or more, as applicable):

	 	o (1)	 	an organization described in Section 501(c)(3) of the Internal Revenue
Code; or

	 
	 	o (2)	 	a corporation; or

	 
	 	o (3)	 	a Massachusetts or similar business trust; or

	 
	 	o (4)	 	a partnership.

	o	 	iii. The undersigned is a trust with total assets exceeding $5,000,000 which was not
formed for the specific purpose of acquiring securities of the Company and whose purchase
is directed by a person who has such knowledge and experience in financial and business
matters that he or she is capable of evaluating the merits and risks of the investment in
the securities of the Company.

	 
	o	 	iv. The undersigned (or, in the case of a trust, the undersigned trustee) is a bank or
savings and loan association as defined in Sections 3(a)(2) and 3(a)(5)(A), respectively,
of the 1933 Act acting either in its individual or fiduciary capacity.

	 
	o	 	v. The undersigned is an insurance company as defined in Section 2(a)(13) of the 1933
Act.

	 
	o	 	vi. The undersigned is an investment company registered under the
Investment Company Act of 1940 or a business development company as
defined in Section 2(a)(48) of the 1933 Act.

	 
	o	 	vii. The undersigned is a Small Business Investment Company licensed by
the U.S. Small Business Administration under Section 301(c) or (d)
of the Small Business Investment Act of 1958.

	 
	o	 	viii. The undersigned is a private business development company as defined
in Section 202(a)(22) of the Investment Advisers Act of 1940.

	 
	o	 	ix. The undersigned is a broker or dealer registered pursuant to Section
15 of the Securities Exchange Act of 1934, as amended.

	 
	o	 	x. All of the equity owners of the undersigned meet one of the tests set forth in Part
a.i. through a.iv or b.i. through b.ii above. Please indicate the name of each equity
owner and which test applies to each:

	 
	 	 	 

 

3

 

7. I understand that an investment in the securities of the Company is highly speculative and
involves a high degree of risk including, but not limited to, the risk of economic losses from
operations of the Company and the total loss of my investment.

8. I acknowledge that the shares issuable upon Conversion of the Note and Exercise of the Warrant
have not been registered under the 1933 Act or under applicable state securities laws (the “State
Laws”), the shares are offered pursuant to exemptions from registration under the 1933 Act and the
State Laws, the transferability of the shares are restricted and that the shares may be sold only
pursuant to registration under the 1933 Act and State Laws, or an opinion of counsel that such
registration is not required. I understand that the Company’s reliance on such exemptions is
predicated in part on my representations to the Company contained herein.

9. I hereby represent and warrant that I am obtaining the shares pursuant to the Conversion and
Exercise for my own account, for long term investment and without the intention of reselling or
redistributing the shares. The shares are being acquired by me in my name solely for my own
beneficial interest and not as nominee for, on behalf of, for the beneficial interest of, or with
the intention to transfer to, any other person, trust or organization, and I have made no
agreement with others regarding any of the shares. My financial condition is such that it is not
likely that it will be necessary for me to dispose of any of the shares in the foreseeable future.

10. Capitalized terms used herein shall have the meanings assigned to them in the Letter, as
applicable, except as expressly defined differently herein.

11. Miscellaneous.

a. I agree to furnish any additional information that the Company or its counsel deem necessary in
order to verify the responses set forth above.

b. I understand the meaning and legal consequences of the agreements, representations and
warranties contained herein. I agree that such agreements, representations and warranties shall
survive and remain in full force and effect after the execution hereof and payment for the shares.
I further agree to indemnify and hold harmless the Company, and each current and future director,
officer, employee, agent and shareholder of the Company from and against any and all loss, damage
or liability due to, or arising out of, a breach of any of my agreements, representations or
warranties contained herein.

c. This Subscription Agreement shall be construed and interpreted in accordance with Minnesota law.

 

4

 

SIGNATURES

Individual Subscriber(s):

	 	 	 
	Dated:                                         ,
 _____.

	 	Dated:                                         ,
 _____.
	 
	 	 
	X

	 	X
	 

	 	 
	Signature

	 	Signature of Second Individual (if applicable)
	 
	 	 
	 

	 	 
	Name (Typed or Printed)

	 	Name (Typed or Printed)
	 
	 	 
	 

	 	 
	Social Security Number

	 	Social Security Number
	 
	 	 
	(_____)                                        

	 	(_____)                                         
	Telephone Number

	 	Telephone Number
	 
	 	 
	 

	 	 
	Residence Street Address

	 	Residence Street Address
	 
	 	 
	 

	 	 
	City, State & Zip Code

	 	City, State & Zip Code
	(Must be same state as in item 1)

	 	(Must be same state as in item 1)
	 
	 	 
	 

	 	 
	Mailing Address

	 	Mailing Address
	(Only if different from residence address)

	 	(Only if different from residence address)
	 
	 	 
	 

	 	 
	City, State & Zip Code

	 	City, State & Zip Code
	 
	 	 
	 

	 	 
	State of Residence of Individual

	 	State of Residence of Individual

*FOR RETIREMENT ACCOUNTS

(please initial in the blank space provided)                     

Purchasing in a Retirement Account. An investment in a private placement of securities is
HIGHLY SPECULATIVE in nature. Accordingly, such an investment may not be appropriate for
Individual Retirement Accounts or other retirement-type accounts that carry conservative investment
objectives. If this investment is in fact purchased in a retirement-type account, the purchaser
hereby represents and affirms that he/she understands the risks of the investment and has decided
that such risks are consistent with purchaser’s investment objectives for this account.

 

5

 

Entity Subscriber:

	 	 	 
	Dated:                                                   ,
 _____ 

	 	 
	 
	 	 
	 

	 	(_____)                                                             
	Name of Entity (Typed or Printed)

	 	Telephone Number
	 
	 	 
	X
	 	 
	 

	 	 
	Signature of Authorized Person

	 	Entity’s Tax Identification Number
	 
	 	 
	 

	 	 
	Name & Title (Typed or Printed) of Signatory

	 	Contact Person (if different from Signatory)
	 
	 	 
	 

	 	 
	Principal Executive Office Address

	 	Mailing Address (Only if different from principal executive
office)
	 
	 	 
	 

	 	 
	City, State & Zip Code

	 	City, State & Zip Code
	(Must be same state as in item 1)
	 	 

*CERTIFICATE OF SIGNATORY

(To be completed if Subscription is completed by an entity)

I,                                          the                      of
                                                             (the “Entity”), hereby certify that I am empowered and
duly authorized by the Entity to execute and carry out the terms of the Subscription Agreement and
to Convert the Note and Exercise the Warrant, and certify further that the Subscription Agreement
has been duly and validly executed on behalf of the Entity and constitute legal and binding
obligations of the Entity.

IN WITNESS WHEREOF, I have set my hand this
 _____ 
day of                     .

	 	 	 
	 

	 	 
	 

	 	(Signature)

 

6

 

ACCEPTANCE

This Subscription Agreement is accepted by Digitiliti, Inc.

	 	 	 	 	 	 	 
	 	 	DIGITILITI, INC.	 	 
	 
	 	 	 	 	 	 
	Dated:                                         

	 	By	 	 	 	 
	 

	 	Its	 	 
	 	 
	 

	 	 	 	 

	 	 

 

7

 

APPENDIX A

Description of the Notes and Warrants held by the Holder

[Bill, you can personalize this exhibit for each holder]

Notes:

	 	•	 	12% Convertible Note dated
 _____, 20____ 
in the principal amount of $_____, as amended. Under the terms of the Incentive Offer, the Note is convertible into shares of
[common/preferred stock — select which one is applicable]

Warrants:

Warrant dated
 _____, 20_____ 
to purchase
 _____ 
shares of common stock, as amended.

Warrant dated
 _____, 20_____ 
to purchase
 _____ 
shares of common stock, as amended.

 

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