THE GEO GROUP, INC. FORM 8-K
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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): September 15, 2005
THE GEO GROUP, INC.
(Exact Name of Registrant as Specified in its Charter)
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Florida
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1-14260
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65-0043078 |
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(State or Other Jurisdiction of
Incorporation)
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(Commission File Number)
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(IRS
Identification No.) |
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621 NW 53rd Street, Suite 700, Boca Raton, Florida
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33487 |
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(Address of Principal Executive Offices)
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(Zip Code) |
(Registrants Telephone Number, Including Area Code) (561) 893-0101
(Former Name or Former Address, if Changed since Last Report)
Check the appropriate box below if the Form 8-K is intended to simultaneously satisfy the
filing obligation of the registrant under any of the following provisions (see General Instruction
A.2. below):
o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
Section 1 Registrants Business and Operations
Item 1.01
Entry into a Material Definitive Agreement.
The information
contained in Item 2.03 below is incorporated herein by reference.
Section 2 Financial Information
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet
Arrangement of a Registrant.
On September 15, 2005, The GEO Group, Inc. (GEO) completed the refinancing of its senior
secured credit facility through the execution of a Second Amended and Restated Credit Agreement
(the Credit Agreement), by and among GEO, as Borrower, BNP Paribas, as Administrative Agent and
Lead Arranger, Bank of America, N.A., as Syndication Agent, and the lenders who are, or may from
time to time become, a party thereto.
The Credit Agreement consists of a $75 million 6-year term loan (the Term Loan B) and a $100
million 5-year revolver (the Revolver). The interest rate for the Term Loan B and the Revolver
is LIBOR plus 2%. GEO plans to use the borrowings under the Credit Agreement to fund general
corporate purposes and to finance GEOs proposed acquisition of Correctional Services Corporation
(CSC) for approximately $62 million. GEO currently anticipates that the proposed acquisition of
CSC will be completed in October 2005, subject to the satisfaction of certain closing conditions
contained in the merger agreement between GEO and CSC.
Of the $75 million in borrowing under the Term Loan B, $41 million constitutes cash on hand.
The remaining $34 million has been placed in an escrow account (the Escrow Account) for use in
connection with the completion of the CSC acquisition. GEOs ability to borrow from the Escrow
Account to complete the acquisition of CSC is contingent on there not having occurred a material
adverse effect (as that term is defined in the Credit Agreement) on GEO and CSC, on a combined
company basis as if the acquisition had been completed, between the closing of the Credit Agreement
and the closing of the acquisition.
All of the obligations under the Credit Agreement are unconditionally guaranteed by each of
GEOs existing material domestic subsidiaries. The Credit Agreement and the related guarantees are
secured by substantially all of GEOs present and future tangible and intangible assets and all
present and future tangible and intangible assets of each guarantor, including but not limited to
(i) a first-priority pledge of all of the outstanding capital stock owned by GEO and each
guarantor, and (ii) perfected first-priority security interests in all of GEOs present and future
tangible and intangible assets and the present and future tangible and intangible assets of each
guarantor.
The Credit Agreement contains certain customary representations and warranties, and certain
customary covenants that restrict GEOs ability to, among other things (i) create, incur or assume
any indebtedness, (ii) incur liens, (iii) make loans and investments, (iv) engage in mergers,
acquisitions and asset sales, (v) sell its assets, (vi) make certain restricted payments, including
declaring any cash dividends or redeem or repurchase capital stock, except as otherwise permitted,
(vii) issue, sell or otherwise dispose of capital stock, (viii) transact with affiliates, (ix) make
changes in accounting treatment, (x) amend or modify the terms of any subordinated indebtedness,
(xi) enter into debt agreements that contain negative pledges on
its assets or covenants more
restrictive than contained in the Credit Agreement, (xii) alter the
business GEO conducts, and (xiii) materially impair GEOs lenders security interests in the
collateral for its loans.
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Events of default under the Credit Agreement include, but are not limited to, (i) GEOs
failure to pay principal or interest when due, (ii) GEOs material breach of any representations or
warranty, (iii) covenant defaults, (iv) bankruptcy, (v) cross default to certain other
indebtedness, (vi) unsatisfied final judgments over a threshold to be determined, (vii) material
environmental claims which are asserted against GEO, and (viii) a change of control.
The Credit Agreement is filed with this report as Exhibit 10.1 and is incorporated herein by
reference. GEOs press release issued in connection with the completion of the Credit Agreement is
filed with this report as Exhibit 99.1 and is incorporated herein by reference.
GEO is including the following cautionary statement in this Form 8-K to make applicable and
take advantage of the safe harbor provisions of the Private Securities Litigation Reform Act of
1995 for any forward-looking statement made by, or on behalf of, GEO. This Form 8-K Report contains
forward-looking statements regarding future events and the future performance of GEO that involve
risks and uncertainties that could materially affect actual results. Investors should refer to
documents that GEO files from time to time with the Securities and Exchange Commission for a
description of certain factors that could cause actual results to vary from current expectations
and forward-looking statements contained in this Form 8-K Report. Such factors include, but are not
limited to: (1) risks associated with GEOs ability to control operating costs associated with
contract start-ups; (2) GEOs ability to timely open facilities as planned, profitably manage such
facilities and successfully integrate such facilities into GEOs operations without substantial
costs; (3) GEOs ability to win management contracts for which it has submitted proposals and to
retain existing management contracts; (4) GEOs ability to obtain future financing on acceptable
terms; (5) GEOs ability to sustain company-wide occupancy rates at its facilities; and (6) other
factors contained in GEOs Securities and Exchange Commission filings, including the forms 10-K,
10-Q and 8-K reports.
ITEM 9.01 Financial Statements and Exhibits.
c) Exhibits
The following exhibits are filed in accordance with Item 601 of Regulation S-K:
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10.1
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Second Amended and Restated Credit Agreement, dated as of September
14, 2005, by and among The GEO Group, Inc., as Borrower, BNP Paribas,
as Administrative Agent and Lead Arranger, Bank of America, N.A., as
Syndication Agent, and the lenders who are, or may from time to time
become, a party thereto. |
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99.1
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Press Release of GEO, dated September 15, 2005 |
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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.
Dated: September 21, 2005
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The GEO Group, Inc.
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/s/
John G. ORourke
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Name: |
John G. ORourke |
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Title: |
Senior Vice President and Chief
Financial Officer |
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