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FORM 10Q -- QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
---------------
FORM 10-Q
---------------
(MARK ONE)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
FOR THE FISCAL QUARTER ENDED JUNE 30, 2000
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD FROM ____________ TO ____________
Commission File Number: 0-20135
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AMERICA SERVICE GROUP INC.
(Exact name of registrant as specified in its charter)
DELAWARE 51-0332317
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
105 WESTPARK DRIVE, SUITE 300
BRENTWOOD, TENNESSEE 37027
(Address and zip code of principal executive office)
(615) 373-3100
(Registrant's telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed under Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes [X] No [ ]
There were 3,781,849 shares of Common Stock outstanding as of August 8,
2000.
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AMERICA SERVICE GROUP INC.
QUARTERLY REPORT ON FORM 10-Q
INDEX
<TABLE>
<CAPTION>
PAGE
NUMBER
------
<S> <C>
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements (Unaudited)
Condensed Consolidated Balance Sheets at June 30, 2000 and December 31, 1999.......................... 3
Condensed Consolidated Income Statements for the quarters and six months ended June 30, 2000
and June 30, 1999................................................................................... 4
Condensed Consolidated Statements of Cash Flows for the six months ended June 30, 2000 and June 30,
1999................................................................................................ 5
Notes to Condensed Consolidated Financial Statements.................................................. 6
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations........... 7
PART II. OTHER INFORMATION
Item 4: Submission of Matters to a Vote of Security Holders............................................. 10
Item 5: Other Events.................................................................................... 10
Item 6: Exhibits and Reports on Form 8-K................................................................ 10
Signature page.......................................................................................... 11
</TABLE>
2
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PART I:
FINANCIAL INFORMATION
AMERICA SERVICE GROUP INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
JUNE 30, DECEMBER 31,
2000 1999
------------- ------------
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents ............................... $ 1,286,000 $ 444,000
Accounts receivable: healthcare and other, less allowance
for doubtful accounts ................................ 46,460,000 39,738,000
Prepaid expenses and other current assets ............... 8,197,000 7,440,000
Current deferred taxes .................................. 1,264,000 1,289,000
-----------------------------
Total current assets ............................ 57,207,000 48,911,000
Property and equipment, net ............................... 4,483,000 3,932,000
Deferred taxes ............................................ 562,000 562,000
Cost in excess of net assets acquired, net ................ 74,645,000 44,548,000
Other assets .............................................. 2,931,000 774,000
=============================
$ 139,828,000 $ 98,727,000
=============================
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable ........................................ $ 20,193,000 $ 11,531,000
Accrued expenses ........................................ 30,753,000 27,882,000
-----------------------------
Total current liabilities ....................... 50,946,000 39,413,000
Noncurrent portion of accrued expenses .................... 2,991,000 2,874,000
Long-term debt ............................................ 51,201,000 25,500,000
Commitments and contingencies
Mandatory redeemable preferred stock ...................... 12,386,000 12,375,000
Mandatory redeemable common stock ......................... 1,842,000 1,842,000
Common stock .............................................. 38,000 37,000
Additional paid in capital ................................ 13,440,000 12,856,000
Stockholders' notes receivable
(1,090,000) (1,060,000)
Retained earnings ......................................... 8,074,000 4,890,000
-----------------------------
Total liabilities and stockholders' equity ...... $ 139,828,000 $ 98,727,000
=============================
</TABLE>
See notes to condensed consolidated financial statements.
3
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AMERICA SERVICE GROUP INC.
CONDENSED CONSOLIDATED INCOME STATEMENTS
<TABLE>
<CAPTION>
QUARTER ENDED JUNE 30, SIX MONTHS ENDED JUNE 30,
2000 1999 2000 1999
------------ ------------ ------------- -------------
<S> <C> <C> <C> <C>
Healthcare revenue ......................... $ 89,449,000 $ 72,218,000 $ 165,618,000 $ 130,499,000
Healthcare expenses ........................ 80,964,000 65,261,000 149,590,000 117,739,000
--------------------------------------------------------------
Gross margin ............................... 8,485,000 6,957,000 16,028,000 12,760,000
Selling, general and administrative expenses 3,169,000 2,944,000 6,410,000 5,964,000
Depreciation and amortization .............. 1,403,000 1,008,000 2,348,000 1,642,000
--------------------------------------------------------------
Income from operations ..................... 3,913,000 3,005,000 7,270,000 5,154,000
Interest, net .............................. (891,000) (1,290,000) (1,421,000) (2,347,000)
--------------------------------------------------------------
Income before taxes ........................ 3,022,000 1,715,000 5,849,000 2,807,000
Provision for income taxes ................. 1,207,000 511,000 2,339,000 1,123,000
--------------------------------------------------------------
Net income ................................. 1,815,000 1,204,000 3,510,000 1,684,000
Preferred stock dividends .................. 161,000 64,000 324,000 2,053,000
==============================================================
Net income (loss) attributable to common
shares ................................... $ 1,654,000 $ 1,140,000 $ 3,186,000 $ (369,000)
==============================================================
Net income (loss) per common share:
Basic .................................... $ 0.44 $ 0.32 $ 0.85 $ (0.10)
==============================================================
Diluted .................................. $ 0.33 $ 0.28 $ 0.65 $ (0.10)
==============================================================
Weighed average shares outstanding:
Basic .................................... 3,737,000 3,576,000 3,732,000 3,576,000
==============================================================
Diluted .................................. 5,510,000 4,284,000 5,428,000 3,576,000
==============================================================
</TABLE>
See notes to condensed consolidated financial statements.
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AMERICA SERVICE GROUP INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
SIX MONTHS ENDED
JUNE 30,
2000 1999
----------- ------------
<S> <C> <C>
Operating activities:
Net income ........................................... $ 3,510,000 $ 1,684,000
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization ...................... 2,348,000 1,642,000
Amortization of deferred financing costs ........... 65,000 56,000
Interest on stockholders' notes receivable ......... (30,000) --
Accretion of subordinated notes .................... -- 282,000
Accretion of mandatory redeemable preferred stock
discount........................................... 11,000 --
Changes in operating assets and liabilities, net of
effects of acquisitions:
Accounts receivable ............................. (4,803,000) 10,747,000
Prepaid expenses and other current assets ....... (60,000) (1,683,000)
Other assets .................................... 42,000 (57,000)
Accounts payable ................................ 8,313,000 4,233,000
Accrued expenses ................................ (2,300,000) (998,000)
-----------------------------
Net cash provided by operating activities ............ 7,096,000 15,906,000
Investing activities:
Cash paid for acquisitions, net of cash acquired ..... (30,757,000) (66,077,000)
Capital expenditures ................................. (1,112,000) (858,000)
-----------------------------
Net cash used in investing activities ................ (31,869,000) (66,935,000)
Financing activities:
Proceeds from long-term debt ......................... 31,095,000 47,000,000
Payments on long-term debt ........................... (5,394,000) (17,000,000)
Payment of deferred financing costs .................. (347,000) (520,000)
Payment of mandatory redeemable preferred stock
dividends........................................... (324,000) --
Common stock issued under Employee Stock Purchase Plan 275,000 --
Exercise of stock options ............................ 310,000 166,000
Proceeds from mandatory redeemable preferred stock ... -- 5,000,000
Proceeds from subordinated notes ..................... -- 15,000,000
-----------------------------
Net cash provided by financing activities ............ 25,615,000 49,646,000
Net increase (decrease) in cash and cash equivalents.. 842,000 (1,383,000)
Cash and cash equivalents, beginning of period ....... 444,000 7,211,000
-----------------------------
Cash and cash equivalents, end of period ............. $ 1,286,000 $ 5,828,000
=============================
</TABLE>
See notes to condensed consolidated financial statements.
5
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AMERICA SERVICE GROUP INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2000
1. BASIS OF PRESENTATION
The interim condensed consolidated financial statements as of June 30, 2000
and for the six months and quarter then ended are unaudited, but in the opinion
of management, have been prepared in conformity with generally accepted
accounting principles applied on a basis consistent with those of the annual
audited consolidated financial statements. Such interim condensed consolidated
financial statements reflect all adjustments (consisting of normal recurring
accruals) necessary for a fair presentation of the financial position and the
results of operations for the six months and quarter presented. The results of
operations for the six months presented are not necessarily indicative of the
results to be expected for the year ending December 31, 2000. The interim
condensed consolidated financial statements should be read in connection with
the audited consolidated financial statements for the year ended December 31,
1999.
2. ACQUISITIONS
Effective June 1, 2000, the Company acquired the stock of Correctional
Health Services, Inc. ("CHS"). The cash purchase price of $17.0 million was
financed with an extension of the Company's existing Senior Credit Facility.
CHS, which is headquartered in Verona, New Jersey, has annualized revenues of
approximately $19.0 million generated by nineteen contracts providing services
to approximately 12,000 inmates. The Company accounted for the acquisition using
the purchase method of accounting.
On March 29, 2000, the Company acquired the Pennsylvania and New York
operations of Correctional Physician Services, Inc. ("CPS"). The transaction was
structured as an asset purchase. CPS has assigned its contracts for the Eastern
Region of the Pennsylvania Department of Corrections and the Yonkers Region of
the New York Department of Correctional Services to Prison Health Services,
Inc., an operating subsidiary of America Service Group. The cash purchase price
of $14.0 million was financed with the Company's existing Senior Credit
Facility. CPS is a privately held company with headquarters located in Blue
Bell, Pennsylvania. Combined, the Pennsylvania and New York operations of CPS
provided services to approximately 21,000 inmates and had approximately $41.0
million in revenue during 1999. The Company accounted for the acquisition using
the purchase method of accounting. For the quarter ended June 30, 2000, the
Company increased its cost in excess of net assets acquired and accrued expenses
related to the CPS acquisition by $1.5 million for potential future payments of
pre-acquisition health care claims of essential providers and cost sharing
liabilities which the former owners of the assigned contracts may not honor.
On January 26, 1999, the Company purchased all of the outstanding stock of
EMSA Government Services, Inc. ("EMSA") from InPhyNet Administrative Services,
Inc. ("InPhyNet") for $63.4 million in cash, net of a working capital cash
payment from InPhyNet of $3.6 million, pursuant to a Stock Purchase Agreement,
dated as of December 18, 1998 (the "Stock Purchase Agreement"), as amended by
the First Amendment to Stock Purchase Agreement, dated as of January 26, 1999
(the "First Amendment"), between the Company and InPhyNet. InPhyNet is a
wholly-owned subsidiary of MedPartners, Inc. ("MedPartners"). The Company
accounted for the EMSA acquisition using the purchase method of accounting.
EMSA conducts its operations through two wholly-owned subsidiaries, EMSA
Correctional Care, Inc. and EMSA Military Services, Inc., each of which became
indirect subsidiaries of the Company pursuant to its acquisition of EMSA. EMSA
Correctional provides comprehensive managed healthcare solutions to state and
local correctional facilities, managing healthcare for approximately 70,000
inmates. EMSA Military contracts with the U.S. Department of Defense (the "DOD")
and the Veterans Administration (the "VA") to provide emergency medicine and
primary healthcare services to active and retired military personnel and their
dependents at medical facilities operated by the DOD and the VA.
The Company used $47.0 million in borrowings under its Senior Credit
Facility and the aggregate $20.0 million in proceeds received from its issuance
of the Convertible Securities to Capital Partners and Executive Partners to
finance, in part, the EMSA acquisition, which consisted of assets acquired of
$89.2 million, including cash of $0.9 million and $46.7 million of cost in
excess of net assets acquired and the assumption of $22.2 million in
liabilities.
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<PAGE> 7
The following unaudited pro forma results of operations give effect to the
operations of the Company as if the EMSA and CHS acquisitions had occurred
effective January 1, 1999:
<TABLE>
<CAPTION>
QUARTER QUARTER SIX MONTHS SIX MONTHS
ENDED ENDED ENDED ENDED
JUNE 30, JUNE 30, JUNE 30, JUNE 30,
2000 1999 2000 1999
----------- ----------- ------------ ------------
<S> <C> <C> <C> <C>
Healthcare revenue ............................ $92,709,000 $76,348,000 $173,204,000 $148,457,000
Net income (loss) attributable to common shares 1,407,000 843,000 2,372,000 (598,000)
Net income (loss) per common share:
Basic........................................ $ 0.38 $ 0.24 $ 0.64 $ (0.17)
=========================================================
Diluted...................................... $ 0.28 $ 0.21 $ 0.50 $ (0.17)
=========================================================
</TABLE>
The pro forma results of operations do not intend to represent what the
Company's results of operations would have been had such transactions occurred
at the beginning of the periods presented or to project the Company's results of
operations in any future period.
ITEM 2. -- MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
This quarterly report on Form 10-Q contains and incorporates by reference
"forward-looking statements" within the meaning of Section 27A of the Securities
Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934,
as amended. Those statements include, among other things, discussions of the
Company's business strategy and expectations concerning the Company's position
in the industry, future operations, margins, profitability, liquidity and
capital resources. All these forward-looking statements are based on estimates
and assumptions made by management of the Company that, although believed to be
reasonable, are inherently uncertain. Therefore, undue reliance should not be
placed on such statements and estimates. No assurance can be given that any of
such estimates or statements will be realized, and it is likely that actual
results may differ materially from those contemplated by such forward-looking
statements. Factors that may cause such differences include, but are not limited
to, those set forth in the Company's Annual Report on Form 10-K for the fiscal
year ended December 31, 1999 (the "1999 Form 10-K") under the heading "Item 1.
Business -- Cautionary Statements," which cautionary statements are hereby
incorporated herein by reference. All forward-looking statements attributable to
the Company or persons acting on behalf of the Company are expressly qualified
in their entirety by the cautionary statements set forth in the 1999 Form 10-K.
In light of these and other uncertainties, the inclusion of forward-looking
statements herein or in any statement made by the Company should not be regarded
as a representation by the Company that the Company's plans and objectives will
be achieved.
GENERAL
The financial statements of the Company for the six months ended June 30,
1999 include the operations of EMSA since January 26, 1999, the date of
acquisition. The acquisition was strategic in that it positions the Company as
the second largest provider of comprehensive managed healthcare for incarcerated
individuals in the United States and positions the Company to capitalize on
opportunities within the $4.5 billion correctional healthcare industry. Through
the acquisition of EMSA, the Company was able to (1) increase its contracts from
thirty-five to ninety-six; (2) increase the number of inmates served from 64,000
to 133,000; (3) leverage its revenue base whereby, at that time, no one contract
exceeded 8% of combined revenue; (4) increase its market presence to twenty-five
states, versus sixteen; (5) leverage its corporate general and administrative
expenses; (6) obtain more favorable pricing in areas such as pharmacy, medical
supplies and lab costs; and (7) strengthen certain critical disciplines such as
marketing and client development.
In addition to the strategic advantages, EMSA's contracts are similar to the
Company's prison and jail contracts, which allowed the Company to implement its
operational process, which includes (1) a claims management tracking system that
monitors incidents, claims and litigation; (2) a Daily Operating Report to
monitor staffing and off-site utilization; (3) Bi-weekly pharmacy reports; and
(4) a comprehensive cost review system that analyzes average costs per inmate at
each facility.
The financial statements of the Company for the six months ended June 30,
2000 include the operations of CHS and CPS since the dates of these
acquisitions, March 30, 2000, and June 1, 2000, respectively. These acquisitions
increased the Company's number of contracts served by 21 and increased the
Company's presence in key geographic regions.
7
<PAGE> 8
RESULTS OF OPERATIONS
SECOND QUARTER JUNE 2000 COMPARED TO SECOND QUARTER JUNE 1999
Healthcare revenues for the quarter ended June 2000 increased to $89.4
million from $72.2 million in the second quarter 1999. The $17.2 million
increase is attributable to the acquisitions of CPS and CHS, an increase in
inmate population and automatic pricing adjustments of existing PHS contracts
and new business. Revenue from CPS and CHS was $12.2 million, existing PHS
contract revenues increased $2.0 million and new business from net marketing
activity was $3.0 million.
Healthcare expenses during the second quarter 2000 were $81.0 million or
90.5% of revenue versus $65.3 million or 90.4% of revenue for the same period in
1999. The $15.7 million increase is mainly attributable to the CPS and CHS
acquisitions.
Selling, general and administrative expenses for the quarter ended June 2000
increased $.2 million as compared to June 1999. As a percent of revenue,
selling, general and administrative expenses were 3.5% for the quarter ended
June 2000 versus 4.1% for June 1999. The percentage decrease demonstrates the
leverage on selling, general and administrative expense provided by the CPS and
CHS acquisitions.
Depreciation and amortization expense for the quarter ended June 2000 was
$1.4 million versus $1.0 million for the same period in 1999. The increase of
$.4 million is mainly due to the amortization of cost in excess of net assets
acquired and non-compete agreements related to the CPS and CHS acquisitions.
Net interest expense of $.9 million for the quarter ended June 2000
decreased $.4 million from the same period in June 1999. The decrease is related
to the $47 million in debt incurred to finance the EMSA acquisition during the
first quarter of 1999, $21.5 million which was paid down throughout fiscal 1999
and the $15 million of subordinated convertible notes which were repaid or
converted to mandatory redeemable preferred stock during the third quarter of
1999. The decrease was offset by the additional debt of approximately $31.0
million incurred for the CPS and CHS acquisitions during fiscal 2000. Interest
expense was offset by $.1 million of interest income for the quarter ended June
2000.
Income taxes for the quarter ended June 2000 were $1.2 million, which
equates to a 40% effective tax rate.
Preferred stock dividends of $.2 million relate to the 5% coupon rate on the
$12.5 million of Convertible Preferred Stock. Preferred stock dividends in 1999
include a one-time noncash, nonrecurring dividend of $1.9 million, which
increased additional paid-in capital and represents a $3.68 per share of
Convertible Preferred Stock dividend.
SIX MONTHS ENDED JUNE 2000 COMPARED TO SIX MONTHS ENDED JUNE 1999
Healthcare revenues for the six months ended June 2000 increased to $165.6
million from $130.5 million for the six months ended 1999. The $35.1 million
increase is attributable to the acquisitions of EMSA, CPS and CHS, an increase
in inmate population and automatic pricing adjustments of existing PHS contracts
and new business. $12.2 million of the increase relates to the CPS and CHS
contracts, $17.3 million of the increase relates to additional revenue under
existing PHS contracts and the effect of owning EMSA for the full six month
period in 2000, and $5.6 million of the increase relates to new business from
net marketing activity.
Healthcare expenses during the six months ended June 2000 were $149.6
million or 90.3% of revenue versus $117.7 million or 90.2% of revenue for the
same period in 1999. The $31.9 million increase is primarily attributable to the
EMSA, CPS and CHS acquisitions.
Selling, general and administrative expenses for the six months ended June
2000 increased $.4 million as compared to the same period in 1999. As a percent
of revenue, selling, general and administrative expenses were 3.9% for the six
months ended June 2000 versus 4.6% for June 1999. The percentage decrease
demonstrates the leverage on selling, general and administrative expense
provided by revenue growth.
Depreciation and amortization increased $.7 million to $2.4 million for the
six months ended June 2000. The increase is mainly due to the amortization of
cost in excess of net assets and non-compete agreements related to the EMSA,
CPS and CHS acquisitions.
8
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Net interest expense was $1.4 million for the six months ended June 2000.
Interest expense was offset by $.1 million of interest income. The outstanding
balance of the Senior Credit Facility was $51.2 million as of June 2000. In
addition, the Company repaid $7.5 million of the $15 million Convertible
Subordinated Notes on July 2, 1999 and converted the remaining $7.5 million to
Mandatory Redeemable Preferred Stock on August 30, 1999.
Income taxes for the six months ended June 2000 were $2.3 million, which
equates to a 40% effective tax rate.
Preferred stock dividends of $.3 million relate to the 5% coupon rate on the
$12.5 million of Convertible Preferred Stock. Preferred stock dividends in 1999
include a one-time noncash, nonrecurring dividend of $1.9 million, which
increased paid-in capital and represents a $3.68 dividend on each outstanding
share of Convertible Preferred Stock at June 30, 1999.
LIQUIDITY AND CAPITAL RESOURCES
The Company's cash and cash equivalents at June 30, 2000, were $1.3 million,
compared with cash and cash equivalents of $.4 million at December 31, 1999.
Cash provided by operating activities during the six months ended June 30, 2000
was $7.1 million compared to cash provided by operations of $15.9 million for
the comparable 1999 period. This decrease is primarily due to the Company's
ability to effectively collect the EMSA receivables during the second quarter of
1999.
Management believes that the current levels of cash, when coupled with
internally generated funds and the remaining availability of $13.8 million under
its new $65 million Senior Secured Credit Facility are sufficient to meet the
Company's foreseeable cash needs.
On July 15, 2000, the outstanding shares of Mandatory Redeemable Common
Stock were sold to an independent third party resulting in the expiration of the
stock's redemption provision. Accordingly, the value of the shares will be
reflected as additional paid-in capital in future financial reporting periods.
During August 2000, the estate of Scott L. Mercy, the former non-executive
Chairman of the Board of Directors who died in an airplane crash in May 2000,
exercised 175,000 stock options and sold the resulting shares. The exercise of
these options resulted in an additional cash inflow of approximately $1.5
million to the Company. Additionally, on August 2, 2000, the Company entered
into a newly syndicated $65 million Senior Secured Credit Facility with four
banks with Bank of America, N.A. serving as lead bank and administrative agent.
The credit facility will help position the Company to meet its future growth
objectives.
YEAR 2000 UPDATE
In prior years, the Company discussed the nature and progress of its plans
to become Year 2000 ready. In late 1999, the Company completed its remediation
and testing of systems. As a result of those planning and implementation
efforts, the Company experienced no significant disruptions in mission critical
information technology and non-information technology systems and believes those
systems successfully responded to the Year 2000 date change. The Company is not
aware of any material problems resulting from Year 2000 issues, either with its
products, its internal systems, or the products and services of third parties.
The Company will continue to monitor its mission critical computer applications
and those of its suppliers and vendors throughout the Year 2000 to ensure that
any latent Year 2000 matters that may arise are addressed promptly.
9
<PAGE> 10
PART II:
OTHER INFORMATION
ITEM 4. -- SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
At the annual meeting of stockholders, held June 5, 2000, the stockholders
of the Company voted to elect the Company's Board of Directors: Michael
Catalano, Chairman, President and Chief Executive Officer (3,464,677 affirmative
votes and 1,500 votes withheld); William D. Eberle (3,464,677 affirmative votes
and 1,500 votes withheld); Burton C. Einspruch (3,464,677 affirmative votes and
1,500 votes withheld); Carol R. Goldberg (3,463,177 affirmative votes and 3,000
votes withheld); David A. Freeman (3,464,677 affirmative votes and 1,500 votes
withheld); Jeffrey L. McWaters (3,391,777 affirmative votes and 74,400 votes
withheld); Richard M. Mastaler (3,464,677 affirmative votes and 1,500 votes
withheld); Richard D. Wright (3,462,677 affirmative votes and 3,500 votes
withheld). In July 2000, Mr. Catalano was elected Chairman of the Board by the
other Directors in addition to his positions as President and Chief Executive
Officer.
ITEM 5. -- OTHER EVENTS
On July 20, 2000, the Company issued a press release discussing its second
quarter 2000 operating performance. A copy of such press release is attached
hereto as Exhibit 99.1 and is hereby incorporated herein by reference.
ITEM 6. -- EXHIBITS AND REPORTS ON FORM 8-K
(A) Exhibits
11.1 -- Statement re-computation of per share earnings.
27.1 -- Financial Data Schedule for the six months ended June 30, 2000
(for SEC use only)
27.2 -- Financial Data Schedule for the six months ended June 30, 1999
(for SEC use only)
99.1 -- June 2000 Earnings Release
99.2 -- Amended and Restated Credit Agreement syndicated on August 2, 2000
99.3 -- Audit Committee Charter
99.4 -- Press release dated May 31, 2000, announcing the acquisition of
Correctional Health Services, Inc. and the related stock purchase
agreement dated April 24, 2000 are incorporated herein by reference
to the Company's Current Report on Form 8-K, filed July 14, 2000,
Commission File No. 0-23340.
(B) Reports on Form 8-K
1. On July 14, 2000, the Company filed Form 8-K, announcing the
completion of the acquisition of Correctional Health Services,
Inc.
2. On August 9, 2000, the Company amended its report on Form 8-K
relating to the purchase of Correctional Health Services, Inc.
for the purpose of including the required financial statements
and pro forma financial information with respect to the
acquisition.
10
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly authorized this report to be signed on its behalf by the
undersigned thereunto duly authorized.
AMERICA SERVICE GROUP INC.
/s/ MICHAEL CATALANO
--------------------------------------------
Michael Catalano
Chairman, President & Chief
Executive Officer
/s/ BRUCE A. TEAL
--------------------------------------------
Bruce A. Teal
Executive Vice President & Chief Financial
Officer
Dated: August 14, 2000
11
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INDEX TO EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
------ -----------
<S> <C>
11.1 -- Statement re-computation of per share earnings...................................
27.1 -- Financial Data Schedule for the six months ended June 30, 2000
(for SEC use only) .............................................................
27.2 -- Financial Data Schedule for the six months ended June 30, 1999
(for SEC use only)..............................................................
99.1 -- June 2000 Earnings Release.......................................................
99.2 -- Amended and Restated Credit Agreement syndicated on August 2, 2000...............
99.3 -- Audit Committee Charter..........................................................
</TABLE>
12
