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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): May 31, 2000
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America Service Group Inc.
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(Exact name of registrant as specified in its charter)
Delaware
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(State or other jurisdiction of incorporation)
0-23340
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(Commission File Number)
21-0332317
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(IRS Employer Identification Number)
105 Westpark Drive, Suite 300, Brentwood, Tennessee 37027
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(Address of principal executive offices)
Registrant's telephone number, including area code: (615) 373-3100
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Not applicable
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(Former Name or Former Address, if Changed Since Last Report)
Exhibit Index Located on Page: 4
Total Number of Pages: 56
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Item 2. Acquisition or Disposition of Assets
On May 31, 2000, America Service Group Inc. (the "Company") purchased
all of the outstanding stock of Correctional Health Services, Inc. ("CHS") from
certain individuals and entities (collectively, the "Shareholders") for $15.0
million in cash pursuant to a Stock Purchase Agreement, dated as of April 24,
2000 (the "Stock Purchase Agreement"), between the Company and the Shareholders.
The Company placed $2.0 million of the purchase price into escrow. The amount
placed in escrow secures the Shareholders' obligations with respect to any claim
by the Company for indemnification from the Shareholders pursuant to the Stock
Purchase Agreement and the renewal of CHS's customer contracts on the terms
specified in the escrow agreement. In addition, the Company paid amounts
totaling $2.0 million to certain executive officers of CHS with respect to
non-competition agreements entered into by them.
The purchase price paid to the Shareholders is subject to increase or
decrease on a dollar-for-dollar basis by an amount equal to the amount by which
CHS's working capital, as reflected on its balance sheet as of May 31, 2000 (the
"Closing Date Balance Sheet"), is in excess of or is less than $0. CHS is
obligated to deliver the Closing Date Balance Sheet to the Company within 45
days following the closing of the acquisition. The Company will account for the
CHS acquisition using the purchase method of accounting.
The Company obtained a portion of the purchase price for the CHS
acquisition from an advance pursuant to the revolving credit facility under its
Amended and Restated Credit Agreement, dated as of January 26, 1999, among the
Company, as borrower, the Company's subsidiaries as listed therein, as
guarantors, the lenders identified therein and Bank of America, N.A., as
Administrative Agent and as Issuing Bank. The amount available for borrowing
pursuant to the revolving credit facility was increased from $40 million to $55
million in connection with the CHS acquisition.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits
(a) Financial Statements
The CHS Financial Statements, together with the independent public
accountants' reports thereon, will be filed by amendment to this Form 8-K not
later than August 14, 2000.
(b) Pro Form Financial Information
The CHS pro forma financial information will be filed by amendment to
this Form 8-K not later than August 14, 2000.
(c) Exhibits
99.1 Stock Purchase Agreement, dated as of April 24, 2000, between the
Company and the Shareholders of Correctional Health Services, Inc.
99.2 Text of Press Release of the Company, dated May 31, 2000.
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Signatures
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Date: July 14, 2000
AMERICA SERVICE GROUP INC.
By: /s/ Bruce A Teal
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Bruce A. Teal
Senior Vice President and Chief
Financial Officer
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EXHIBIT INDEX
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Exhibit Page No.
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99.1 Stock Purchase Agreement, dated as of April 24, 2000, between the
Company and the Shareholders of Correctional Health Services, Inc. 5
99.2 Text of Press Release of the Company, dated May 31, 2000. 56
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