Good morning, and welcome to The GEO Group Third Quarter 2021 Earnings Conference Call. All participants will be in listen-only mode. [Operator Instructions]. Please note, this event is being recorded. I'd now like to turn the conference over to Pablo Paez, Executive Vice President of Corporate Relations. Please go ahead.

Thank you, Operator. Good morning everyone, and thank you for joining us for today's discussion of The GEO Group's third quarter 2021 earnings results. With us today are George Zoley, Executive Chairman of the Board; Jose Gordo, Chief Executive Officer; Brian Evans, Chief Financial Officer; and James Black, President of GEO Secure Services. This morning, we will discuss our third quarter results and our outlook. We will conclude the call with a question-and-answer session. This conference call is also being webcast live on our investor website at investors.geogroup.com. Today, we will discuss non-GAAP basis information. A reconciliation from non-GAAP basis information to GAAP basis results is included in the press release and supplemental disclosure we issued this morning. Additionally, much of the information we will discuss today, including the answers we give in response to your questions, may include forward-looking statements regarding our beliefs and current expectations with respect to various matters. These forward-looking statements are intended to fall within the Safe Harbor provisions of the securities laws. Our actual results may differ materially from those in the forward-looking statements as a result of various factors contained in our Securities and Exchange Commission filings, including the Form 10-K, 10-Q and 8-K reports. With that, please allow me to turn this call over to our Executive Chairman, George Zoley. George?

Thank you, Pablo, and good morning to everyone. We are pleased with our strong third quarter results in the significant progress we've made year-to-date towards reducing our net debt leverage. We believe our financial performance is representative of the resiliency and strength of our diversified business segments. For over 30 years, we've been a trusted government services provider. We currently provide support services for immigration processing centers on behalf of the U.S. Department of Homeland Security, and for secure facilities and residential reentry centers on behalf of federal and state agencies. During the third quarter, we renewed eight of our facility contracts including four immigration processing centers and four residential reentry centers, under contract with the Federal Bureau of Prisons, or state correctional agencies. Additionally, we have received a six month extension for our U.S. Marshals contract at the Western Regional Detention Facility in San Diego, California. We also entered into a new five-year contract for our Moshannon Valley Facility with Clearfield County, Pennsylvania to provide support services under a five-year intergovernmental agreement between the county and the Department of Homeland Security. In early September, our GEO care business unit began providing services at our new Residential Reentry Center in Tampa, Florida under contract with the Federal Bureau of Prisons. On November 1, we transitioned the operations of our Guadalupe County Facility to the New Mexico Corrections Department and began a new lease agreement with the state of New Mexico with a two-year base period and success of two-year renewal opportunities through October 2041. In the third quarter, we also completed the previously announced transition of two managed only contracts in Florida to another operator and the discontinuation of our managed only contract for the Dungavel Facility in the United Kingdom. Further, we were notified by the BOP of the…

Thank you, George. Good morning, everyone. Today we reported third quarter revenues of approximately $557 million in net income attributable to GEO of $34.7 million. Our third quarter results included $1.1 million pre-tax loss on real estate assets, $4 million in M&A related expenses pre-tax. A one-time $5 million pre-tax loss on the previously announced divestiture of our youth services contracts and an $800,000 benefit in the tax effective adjustments to net income attributable to GEO. Excluding these items, we reported third quarter adjusted net income of $0.36 per diluted share, and AFFO of $0.65 per diluted share. Moving to our guidance we expect fourth quarter 2021 net income attributable to GEO to be between $40 million and $42 million on quarterly revenues of $554 million to $559 million. We expect fourth quarter 2021 adjusted net income to be between $0.37 and $0.39 per diluted share and fourth quarter 2021 AFFO to be between $0.65 and $0.67 per diluted share. For the full-year 2021, we expect net income attributable to GEO to be in a range of $165.5 million to $168 million and full-year 2021 revenues of approximately $2.26 billion. We expect full-year 2021 adjusted net income to be in a range of $1.41 to $1.43 per diluted share. We expect full-year 2021 AFFO to be in a range of $2.57 to $2.59 per diluted share. We expect full-year 2021 adjusted EBITDA to be in a range of $451.5 million to $455 million. Moving to our capital structure at the end of the third quarter, we had approximately $537 million in cash on hand, primarily resulting from the previously announced drawdown of our revolving credit facility. Our decision to draw on our revolver was a conservative precautionary step to preserve liquidity, maintain financial flexibility, and obtain additional funds for general…

Thank you, Brian. Good morning, everyone. Our operational focus during the third quarter has remained on addressing the ongoing challenges of the COVID pandemic, as our frontline employees continue to provide quality services and compassionate care to those entrusted to our facilities. We continue to focus on implementing mitigation initiatives and practices that are consistent with the guidance issued by the Centers for Disease Control and Prevention. Our employees have continued to have access to paid leave and paid time off to be able to remain home as needed. Face mask and cleaning supplies continue to be made available across our facilities. And as noted by Executive Chairman, we have made a significant investment of $2 million to deploy Abbott Rapid Test Devices across our facilities, which has allowed us to screen new arrivals at intake and isolate and quarantine positive cases. Through the end of October 2021, we had administered approximately 184,000 COVID tests at our Secure Services facilities since the start of the pandemic. We also invested $3.7 million to install bipolar ionization systems at Select Services facilities to reduce the spread of airborne bacteria and viruses. We have been working closely with our government agency partners and local health departments to increase the vaccination rates at our facility. At the end of October 2021, approximately 39,000 individuals in our Secure Services facilities have been fully vaccinated, representing approximately 65% of the population in our facilities. We will evaluate our mitigation efforts and we'll make adjustments based on updated guidance by the CDC and other best practices. With respect to recent contract activity, during the third quarter, we renewed four contracts with immigration processing centers, where we provide support services on behalf of the U.S. Department of Homeland Security. We also entered into five-year contract with Clearfield County,…

Thank you, James. Good morning, everyone. Unfortunately, the President of our GEO Care business unit Ann Schlarb is unable to join us today. However, I'm pleased to provide you with an update. During the third quarter, our GEO reentry facilities and programs have remained focused on the implementation of our COVID mitigation strategies and practices consistent with the guidance issued by the CDC. We continue to focus our efforts on increased sanitation, testing and deploying face masks. And we have ensured that our employees continue to have access to paid leave and paid time off to remain home as needed. We evaluate our mitigation efforts on an ongoing basis, and we'll make adjustments as appropriate and necessary based on updated guidance by the CDC and other best practices. Operationally, our GEO Reentry services division had an active third quarter with the opening in early September of our new 118-bed residential reentry center in Tampa, under contract with the Federal Bureau of Prisons. We also opened four new day reporting centers in Tennessee and two new day reporting centers in Louisiana with capacity to provide services for up to 540 individuals. And we successfully renewed for residential re-entry contracts during the third quarter, two with the Federal Bureau of Prisons and two with state correctional agencies. As we disclose last quarter, on July 1, we completed the divestiture of our youth services contracts, which resulted in the assignment of the contracts to an independent nonprofit entity. We retained the real estate ownership of our six company-owned youth services facilities and entered into a lease agreement with the new operating entity. Moving to our electronic monitoring division, we are very pleased with the continued sequential growth in quarterly revenues for BI, which provides a full suite of electronic monitoring and supervision solutions,…

We will now begin the question-and-answer session. [Operator Instructions]. The first question comes from Joe Gomes with NOBLE Capital Markets. You may go ahead.

Good morning, and thanks for taking my questions. So first I wanted to ask a little bit on ICE, the looking at some of the information that comes out from ICE there. ADP has been falling here the past month or two. There is the whole issue on title 42. Just trying to get an idea on how you've been seeing your ICE populations. Your thoughts on title 42. And also nice deal to see Moshannon Valley. Are there any of the other your recently closed facilities that ICE might be looking at in order to enter into new contracts?

Well, we continue to market all of our idle facilities to federal and state agencies, as exemplified by the recent lease with the State of New Mexico, the opening of the Moshannon facility under contract with the county for ICE purposes, and I think that facility was more directed to a consolidation of ICE services in the surrounding states. So we've made our facilities known to the ICE officials, as far as where they're located geographically, their capacities and so forth. And they are evaluating those facilities.

And in terms of your ICE population to your quarter-over-quarter?

I think it went up during the quarter, and it went down at towards the end of the quarter. So the reason for that we really don't know, because there's approximately 200,000 people coming across the border monthly. So all detention, as we've said many times is selective detention and we're not involved in those decisions. We merely provide the secure housing to support those decisions.

Right. Okay. Thank you on that. And you mentioned it a couple of times in the call here. The potential sale of that company assets. And obviously, there's been some press about the potential sale of your BI business. I was wondering, could you comment a little bit more on that if, for example, it was to be sold. Do you lose any type of synergies with the rest of the remaining businesses? And then, again, you mentioned that it did very well in the quarter, the electronic monitoring business. And just wondering what is driving the positive momentum in that business?

With regard to your first question, were prohibited by SEC rules on commenting on any potential asset sales. So in -- we can't really comment on rumors. But the ISEP program has in itself increase substantially since the beginning of the year, but it increased over the quarter and then decreased a little bit towards the end of the quarter. Somewhat similar to our ICE detention.

Okay. Thank you for that. And I noticed you guys increased the fourth quarter guidance from where it was in the third quarter. I was just wondering, again, what is behind that when you listen to your call? And if you've lost some contracts here, what is driving the increase in estimated revenues? And pardon me net income attributable at GEO for the fourth quarter?

Well, I think in some of our facilities, we have seen some improvements in populations or occupancies. And we're also continuing to experience good cost control, I think, in other facilities. And so the net of those two, we've taken into account in the fourth quarter, it's been pretty consistent through the first nine months of the year. So we've assumed some of that going forward as well.

Okay. And you mentioned new opportunity that you're working on in Arizona. Any other new state opportunities that you can tell us about?

No, that's the only public procurement that that we can acknowledge at this time.

Okay, great. Thanks for taking the questions. I'll get back in queue and let someone else asking questions.

Thank you.

Our next question comes from Kirk Ludtke with Imperial Capital. You may go ahead.

I have a just a couple topics I'd like to follow-up on and a couple of new ones. One is the minimum wage litigation. I'd like to revisit New Mexico for a second. And as well as BI. With respect to the minimum wage litigation. I'd like to understand the contracts a little bit better. And more specifically, who's responsible, if this goes against you and you're forced to pay back wages? Is that a cost that ICE assumes under the contract, or is that something that that you would have to pay for?

Well, in the highly improbable scenario you've just described, I imagine we would have to initially pay for the wages, but we would probably have a legal basis for a claim against ICE. But I emphasize how highly improbable, because there's been a recent court ruling out of the Fourth Circuit Court of Appeals that's squarely on this point in the basis of the ruling was put simply that people in a confinement facility are by definition not in the workforce, and cannot be employees. Because they're being confined, they cannot -- and they're not subject to minimum wage payment. And it is also further against federal law to employ illegal aliens from migrants who come into our country.

Okay, thank you. That's helpful.

In our contracts, let me add a couple of things. Our contracts specifically says that the detainees in our custody cannot be employees. We cannot use them as employees.

Okay, that's helpful. Thank you. Are the -- I suspect that this could be an issue with respect to other customers. Is that -- are the contracts the same in terms of how detainees or prisoners are compensating?

The ICE contracts have very standardized terms. And this is one of them, that there is a requirement in each ICE contract and ICE being partnered within the Department of Homeland Security. A portion of the contract requires that a voluntary work program be established predominantly to reduce idleness in the facility for the detainees. And for them to have an opportunity to contribute to the well running of the facility and the services they themselves receive. We administer that program as required in the contract. But the compensation for that program is stipulated in the contract and by Congress. And the contract is to come up for 15 years as said that the amount shall be $1 or no less than $1. And that's the payment that's been made. And that's the typical tax in all of our ICE contracts.

Okay, thank you. That's helpful. Are the contract provisions with respect to this issue? The same with the states, your state customers?

No, it probably varies from state-to-state. And any payment that we would make would be pursuing to similar payments that the state makes in their own facilities. Though, it's probably a few more dollars more. But it's not more than that. In no state facility that we operate, in no state law that we come under requires the payment of minimum wage to inmates who are confined in incarcerated in the facility.

Okay, thank you. With respect to New Mexico --?

Yes.

Yes. Are there other states that -- is this I'm curious if you think this might be the beginning of a trend where states assume operation, the operations of facilities. And so I'm curious if other states are interested in something similar? What the profitability -- how the profitability of the facility changes before and after the transition? And what you think about the leasing model in general? I mean, do you think it's something you'd like to do more?

We are marketing our idle facilities to other governmental organizations. And one of the possibilities is obviously the leasing model and we're very open to it. We, as currently as a REIT, it's part of our business model. So we're very comfortable with that concept. And so and comfortable with us being either the operator or not being the operator.

And the profitability. I know you don't want to say specifically what you make there, but directionally is it more or less profitable after the transition?

It all depends on what occurred before the transition, whether depends on the prior occupancy levels of the facility. So there's a lot of factors that go into it. So I really can't generalize on the experience of one situation.

Got it. Okay. Thank you. And moving to BI for a second. Is this a good CapEx run rate? I mean, it was a revenue picked up sequentially, quite a bit in the quarter, which was good to say is, but is this a CapEx run rate we should be thinking about for BI?

Well, there's some, I think as we've said before, there's some transition of technology. So the CapEx rates are little bit higher right now, I'd say $5 million to $10 million, but that should complete next year. So this rate that we're experiencing this year should be consistent next year, and then after that, I think it would take for some depending on how much they're growing.

Okay, thank you. That's helpful. And then lastly, I saw some press reports about a facility in Alabama. Did you mention this? And I missed it, or is there something, some opportunity there?

We've been in discussions with Alabama for several years now and their interest is presently of the potential purchase of the facility.

But nothing concrete yet?

But I believe they need legislative authorization to move ahead with that.

Our next question comes from Mitra Ramgopal with Sidoti. You may go ahead.

Yes, hi, good morning. Thanks for taking the questions. First, just a couple on occupancy levels. I was curious if you're seeing any easing of COVID restrictions, that's resulting in some of the improved occupancy at some of the facilities you mentioned?

I don't know if it's the easing of restrictions, or rather the inverse that we are stepping up our vaccination program of staff and individuals inside the facility and better treatment protocols. And it appears to be a virus that we're going to have to deal with for some time. So we're in our, I guess second year of this virus, and we're getting accustomed to the required protocols for dealing with this virus and social distancing within the facilities with testing people when they come in as they go out and so forth, so better procedures through longer experience.

Okay. If I remember, I think it was a restriction of maybe 75% in terms of capacity. I was wondering if maybe that for example, might have changed?

No, I don't know any restrictions.

The facilities, there was some time I don't know if that's been lifted or not yet.

Okay, okay.

And we see a wide difference in occupancies. And I don't know if it's driven by the prior statement of you can't I think that that statement is still generally enforced, you can't go above the 75. But where you are with below 75 depends on a number of factors.

Okay, thanks for clearing that up. And just curious on the U.S. Marshal facilities if you're also maybe benefiting from increased activity in terms of court and sentencing et cetera at the Federal level?

Well, I think there has been a general increase in our U.S. Marshals count in the several facilities we have for the Marshals Service around the country.

Okay. On the BI business, I know you don't comment specifically on it, but I was just wondering if there's anything you're doing to drive the increases, we're seeing there?

The increase in participant counts has been driven by the administration really policy decisions.

Okay, so that's something you currently focus on.

Yes, the activity at the border that George mentioned earlier, several 100,000 people per month, coming across the Southern border, and some of those individuals are being put into the [indiscernible] program. Certainly not all of them, but some of them are.

Okay, thanks. And I'm just wondering if you had any comment on the favorable ruling you got in terms of the California Bill that they were trying to pass and how that might affect you going forward?

Well, we think it was a historic ruling in the sense that it affirm that states cannot discriminate against the Federal government regarding the implementation of immigration policy, and in that particular case, the state had provisions allowing themselves to use private sector facilities for a period of time. And it did not provide the same benefits to the Federal government. In fact, it required the closure of Federal facility. So that was part of the ruling, that the State law 32, was inherently discriminatory against the Federal government.

Okay. And as I think you mentioned, you're still evaluating the corporate tax structure. Should we expect an announcement on that front in conjunction with the year-end earnings release?

I would say by year-end or that time for sure.

Our next question comes from Henry Coffey with Wedbush. You may go ahead.

Yes, good morning. And thank you for taking my questions. No, with the BI Electronic and monitoring and location monitoring, obviously, that is benefiting from ICE counts. But are there any policy initiatives that could really alter the equation there, mainly to the positive you have a whole new, a possible rethink on how to manage immigration populations, et cetera, something I would really I mean, we see where the growth is coming from, but an initiative that would really change the equation or?

I don't think it's necessary for a new initiative. The contract itself allows for a significant increase in the numbers of people who participate in the program. So it continues to be used, as you know, I think the idea of alternatives to detention is being more popularized and receiving support on a bipartisan basis. It's cheaper, and it's effective and the technology is being continuously improved. And therefore, it's gaining popularity in its usage.

And then, on this minimum wage situation, is this something that is caused you to pause and then put in an amendment to all your existing contracts to clarify, who's at risk if there is a change?

No, no, we don't we believe the law is clear. There's been 100 court cases on this subject regarding confined detainees or inmates as to whether they're entitled to minimum wage law in all of those courts have ruled in the negative they're not and most recently, I think it was in March, the Fourth District Court of Appeals ruled on a core civic lawsuit that involved a facility in New Mexico. And it was unanimous decision. And I think one or two of the Judges were democratically recommended judges from prior Democratic administrations. And it was unanimous ruling that people who are under confinement are not in the work force. And by definition cannot become employees.

So the current case is more of an anomaly in your view than of some substance?

Yes, in this particular court hearing, the Fourth Circuit Court of Appeals decision was not accepted or allowed to be argued. And Washington is in a different circuit, they're under the Ninth Circuit. And it was the first time that circuit has undertaken this issue. And we're disappointed obviously in the outcome. But we are very optimistic about the ultimate end result that it's fairly well established case law in just general understanding that people who are being confined such as inmates or detainees are not in the workforce in and do not have the ability to be treated as or compensated as employees, they're there 24 hours a day, they're under confinement, they don't get to bargain for their wages. They're not part of the workforce.

And then finally on the REIT issue, given the minimal cash strain from sort of a combination stock and cash dividend, what are the open issues that are preventing you from kind of coming to a quick and final resolution? How are you balancing one against the other and what's at risk here and what's driving the decision process about whether you'll hold or drop REIT status?

Well, I think as we've said during the year, we're working with our financial and legal advisors to look at the best structure for the company going forward. So it's not just the read status. We have the debt issues that we need to deal with. So it's a total comprehensive review, and when that process is far enough along, we'll make a decision and we'll make an announcement with regards to our --

Can you give us any insight into what the issues at hand are around this?

As far as I'm not sure what you mean by issues at hand?

I mean, what are the issues you're looking at? When trying to make the decision?

Consideration we're looking at, what's the best use of the company's cash flows going forward? Where are we going to get the most value for the cash flow that we generate? Is it dividend? Is it paying down debt? Is it reinvesting in the business? And how much liquidity do we want to have as a company as we move forward? How is the market? Right tax rates? And how is the market acknowledging the dividend that we were substantial paying that was fairly substantial previously, and I would argue that it wasn't necessarily reflected in the equity value. So we're looking at all of those things. We're reviewing them as a management team and working with our board and the financial advisors. And as George said earlier, we expect to come to some conclusion with that by year-end.

Would you consider a potentially dilutive preferred or equity offering as a way to reduce the capital debt stress on the company's balance sheet or…

It's being mindful of all strategies and all the stakeholders were trying to engage. Yes, we've engaged to help us through that process. So we'll be mindful of the equity holders and the debt holders.

Our next question comes from Jordan Sherman with Ranger Global. You may go ahead. Forgive me. It's Oren Shaked with BTIG. You may go ahead.

Hi, good morning, going back to the potential re-contracting of idle facilities. George, how would you characterize some of the conversation having on that flip?

Could you speak up a little bit louder, because we cannot hardly hear you.

Sorry, going back to -- can you hear me now?

Yes, go ahead.

Okay. Very good. Going back to the potential re-contracting of idle facilities? How would you characterize some of the conversations that you're having on that front? Can you just give us some color around the reception that you're getting from different parties that you're speaking with?

I can only say, we're relatively optimistic with both federal agencies and state agencies.

Okay, I appreciate that. And then going back to BI. You talked about ICE app -- was some an increase in during the quarter and then it tapered off towards the end. Maybe give us a little bit of a flavor for the variability of the revenue associated with ICE app and how much it might swing both intra quarter and inter quarter?

Well, it's a per diem base service. There is no minimum guarantees if you will. But I think if you look at the trend of the contract for the ICE app contract, and then in general, for the rest of the EM business, it's been steady growth over the period of our ownership and even prior to our ownership. So, it's probably averaged between 5% to 10%, closer to 10% growth over the contract period. Sometimes it goes in spurts, but it seems to move steadily upwards.

Our next question comes from Jordan Sherman with Ranger Global. You may go ahead.

Yes, thanks. Can you guys hear me now?

Yes.

Okay, good. So I wanted to ask about the court case in Washington, just a timeline of what happens from here, you're going to appeal, when do you have to file that appeal. And then what's -- just the timeline of how that will progress or at least do expect it to progress?

I think the timeline is by month-by-month for the appeal and then it could take several months for the case to be heard and several months thereafter for a ruling to be established.

Right. So the only clear timeline is that you have about a month to file the appeal, and then it's up to -- it'll grind its way through the courts as it climbs its way through the courts?

Yes, yes.

Okay, perfect. Then separately, the other ICE contracts that expire this year. I'm sure having other conversations, what's the -- is there any update on the status of those? Apologize if I missed that, as you mentioned -- made comments about those.

Contracts or BOP contract?

Well, I know the BOPs, the BOP you've got noticed on Big Springs and Flightline, right?

Yes, we renew the overall contract. Yes, there is ICE contracts that are expired this year.

That's the end of it. So this year, next year, we have a couple?

Well, we always have a couple. I mean, even they come up to their renewal date. I don't think we have any expirations per se.

Well, renewal dates. I apologize, I've missed both.

There could be a couple of renewal dates next year.

Are those in discussion already? Any thoughts about how those will?

Now, not really, not at this time.

Good. Still too early.

Yes. Too early.

Okay. You mentioned -- I want to clarify, I just wanted to confirm I've heard this correctly. You said the only active RFP at the moment is the one in Arizona?

That comes to my mind the only public art well…

Yes, yes.

So why he hasn't done an RFP yet. They're talking about doing one next year. But the only public RFP statement. Is the Arizona, State RFP.

And I was under the understanding that they wanted to complete that this year?

No. I think it's going to be a decision for early next year. And the award could be -- two awards. Because that number of beds, I don't both 2,700 beds, I don't believe is available at any single facility.

Okay, so it could be multiple contracts. Their discussion -- their notes -- I am sorry

Because they're high security prisoners, and they require cell type housing.

Got it. Okay. So in terms of in terms of public RFPs is only one. Discussions with other states about possible needs for their -- is there anything that you can comment about any conversations going on?

No, I can't comment. But there are conversations and those kinds of transactions that do not require RFPs.

Given me a set differently. Is any other state announced that they have a need for beds and might go be looking for them? Let me say it that way?

I can't comment.

Okay, so no one has said publicly, that they are out looking for beds type of thing. I'm not asking you to say something quick and say I'm just saying, if there are states that have said that they're out looking for beds, and they've made those comments publicly, then you should be able to…

I really can't say affirmatively, one way or the other because there's a bunch of news articles all the time about people saying things and it doesn't necessarily lead to an RFP or something. I mean, Idaho says stuff in the past, even in the state of Florida, one of the speak the Senate President I think said something about consolidating and building new -- larger facilities and so forth. So there's always discussion like that, but I don't know that there's anything definitive as it relates to our industry

Is your expectation that we will get some RFPs that or the other way around that there is enough activity that you will be able to -- you will find some contracts for at least you'll have a shot at getting the contract for some of the additional facilities.

Our inclination is to time it in our aspirations, our do not include RFPs.

Got it? Okay. So there are discussions that you think are advanced enough that -- okay, we can move on to that apologist, The two Texas facilities are your plans at the moment to wind them down to either close facilities or?

Well, they're being wound down by the BOP that's removing prisoners and relocating them, but we are actively marketing those two locations.

I guess when will BOP have fully wound those down? A…

By the end of this month.

By the end of this market? Okay.

As far as the inmates in the facility.

What type of visibility would you need on those potential contracts? Like how long could you keep those facilities or people in place in hopes of getting a contract? Does that make sense?

Yes.

My answer is it's under review at this time, pending our review of what our potential opportunities are.

And I guess I've been asked that…

We have made a decision. Yes.

Yes. I appreciate that. I guess more generically, if this facility winds down. How long were you? I guess it’s going matter how close you think you are to a separate contract?

Yes, situational.

This concludes our question-and-answer session. I'd like to turn the conference back over to George Zoley for any closing remarks. Well, thank you very much for participating in today's call. We look forward to addressing you on the next one.

The conference is now concluded. Thank you for attending today's presentation. You may now disconnect.