America Service Group Announces New Contract Awards.

BRENTWOOD, Tenn. -- America Service Group Inc. (NASDAQ:ASGR) announced today that its operating subsidiaries, Prison Health Services, Inc. (PHS) and Secure Pharmacy Plus, LLC (SPP), have been awarded one (1) new contract and have begun negotiations for two (2) additional contracts in recent days totaling approximately $13 million in annualized revenues.

PHS has been selected as the successful bidder by the State of Wyoming Department of Corrections to provide comprehensive healthcare services to its population of 1,275 inmates located in four sites beginning July 1, 2005. PHS has also been selected to provide healthcare services to a new 960-bed facility that is scheduled to be opened by another state department of corrections in June 2005. Our provision of services in both instances is subject to the negotiation of a final contract. Although no assurance can be given as to whether these contracts will be successfully negotiated or as to their terms, we currently expect these contracts to be completed this month.

SPP has added a new pharmacy client, CiviGenics Texas, Inc., a national provider of in-prison treatment programs and owner/operator of prison and jail facilities.

"We are pleased to see continued momentum in the award of new business to our PHS and SPP operations," stated Lawrence H. Pomeroy, chief development officer. "Our team looks forward to successful partnerships in providing outstanding care to our patients and appreciates the confidence placed in us by our new clients."

America Service Group Inc., based in Brentwood, Tennessee, is the leading provider of correctional healthcare services in the United States. America Service Group Inc., through its subsidiaries, provides a wide range of healthcare and pharmacy programs to government agencies for the medical care of inmates.

This press release may contain "forward-looking" statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, including the Company's beliefs and expectations of future performance, the effects of any stock split and may be indicated by words or phrases such as "anticipate," "estimate," "plans," "expects," "projects," "should," "will," "believes" or "intends" and similar words and phrases. As such, they involve risk and uncertainty that actual results may differ materially from those projected in the forward-looking statements including, without limitation, risks related to the following: the Company's ability to retain existing client contracts and obtain new contracts; whether or not government agencies continue to privatize correctional healthcare services; the possible effect of adverse publicity on the Company's business; increased competition for new contracts and renewals of existing contracts; the Company's ability to execute its expansion strategies; the Company's ability to limit its exposure for catastrophic illnesses and injuries in excess of amounts covered under contracts or insurance coverage; the outcome of pending litigation; and the Company's dependence on key personnel. A discussion of these important factors and assumptions regarding the statements and risks involved is contained in the Company's annual report on Form 10-K and other filings with the Securities and Exchange Commission. These forward-looking statements are made as of the date of this release. The Company assumes no obligations to update or revise them or provide reasons why actual results may differ.