UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. )*
American Shared Hospital Service
(Name of Issuer)
Common Stock
(Title of Class of Securities)
029595105
(CUSIP Number)
Keith Honig Esq., 1 SunAmerica Center, Los Angeles, CA
90067-6022 (310) 772-6306
(Name, Address and Telephone Number of Person Authorized to Receive
Notices and Communications)
May 17, 1995
(Date of Event which Requires Filing of this
Statement)
If the filing person has previously filed a statement on Schedule 13G to
report the acquisition which is the subject of this Schedule 13D, and is
filing this schedule because of Rule 13d-1(b)(3) or (4), check the
following box ----.
Check the following box if a fee is being paid with the statement ---. (A
fee is not required only if the reporting person: (1) has a previous
statement on file reporting beneficial ownership of more than five percent
of the class of securities described in Item 1; and (2) has filed no
amendment subsequent thereto reporting beneficial ownership of five percent
or less of such class.) (See Rule 13d-7.)
Note: Six copies of this statement, including all exhibits, should be
filed with the Commission. See Rule 13d-1(a) for other parties to whom
copies are to be sent.
*The remainder of this cover page shall be filled out for a reporting
person's initial filing on this form with respect to the subject class of
securities, and for any subsequent amendment containing information which
would alter disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be
deemed to be "filed" for the purpose of Section 18 of the Securities
Exchange Act of 1934 ("Act") or otherwise subject to the liabilities of
that section of the Act but shall be subject to all other provisions of the
Act (however, see the Notes.)
Page 2 of 65 Pages
SCHEDULE 13D
CUSIP No. 029595105
1. NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Sun Life Insurance Company of America
52-0502540
---------------------------------------------------------------------------
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) ---
(b) ---
-------------------------------------------------------------------------
3. SEC USE ONLY
-------------------------------------------------------------------------
4. SOURCE OF FUNDS
OO
--------------------------------------------------------------------------
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) or (a)
---------------------------------------------------------------------------
6. CITIZENSHIP OR PLACE OF ORGANIZATION
Arizona
---------------------------------------------------------------------------
7. SOLE VOTING POWER
NUMBER OF 190,567 shares of Common Stock (includes
SHARES 39,770 shares issuable upon the
BENEFICIALLY conversion of warrants)
OWNED BY --------------------------------------------
EACH
REPORTING 8. SHARED VOTING POWER
PERSON
WITH --------------------------------------------
9. SOLE DISPOSITIVE POWER
190,567 shares of Common Stock (includes
39,770 shares issuable upon the conversion
of warrants)
---------------------------------------------
10. SHARED DISPOSITIVE POWER
--------------------------------------------------------------------------
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
190,567 shares of Common Stock (includes 39,770 shares issuable upon
the conversion of warrants)
--------------------------------------------------------------------------
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
--------------------------------------------------------------------------
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
4.78%
14. TYPE OF REPORTING PERSON
IC
*SEE INSTRUCTIONS BEFORE FILLING OUT!
Page 3 of 65 Pages
SCHEDULE 13D
CUSIP No. 029595105
1. NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Anchor National Life Insurance Company
86-0198983
---------------------------------------------------------------------------
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) ---
(b) ---
--------------------------------------------------------------------------
3. SEC USE ONLY
--------------------------------------------------------------------------
4. SOURCE OF FUNDS
OO
---------------------------------------------------------------------------
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) or (a)
--------------------------------------------------------------------------
6. CITIZENSHIP OR PLACE OF ORGANIZATION
California
-------------------------------------------------------------------------
7. SOLE VOTING POWER
NUMBER OF 279,401 shares of Common Stock (includes
SHARES 58,310 shares issuable upon the conversion of
BENEFICIALLY warrants)
OWNED BY --------------------------------------------
EACH 8. SHARED VOTING POWER
REPORTING
PERSON --------------------------------------------
WITH 9. SOLE DISPOSITIVE POWER
279,401 shares of Common Stock (includes
58,310 shares issuable upon the conversion of
warrants)
--------------------------------------------
10. SHARED DISPOSITIVE POWER
--------------------------------------------------------------------------
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
279,401 shares of Common Stock (includes 58,310 shares issuable upon
the conversion of warrants)
--------------------------------------------------------------------------
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
--------------------------------------------------------------------------
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
7.0%
--------------------------------------------------------------------------
14. TYPE OF REPORTING PERSON
IC
*SEE INSTRUCTIONS BEFORE FILLING OUT!
Page 4 of 65 Pages
SCHEDULE 13D
CUSIP No. 029595105
1. NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
SunAmerica Inc.
86-0176061
---------------------------------------------------------------------------
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) ---
(b) ---
---------------------------------------------------------------------------
3. SEC USE ONLY
--------------------------------------------------------------------------
4. SOURCE OF FUNDS
OO
---------------------------------------------------------------------------
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) or (a)
---------------------------------------------------------------------------
6. CITIZENSHIP OR PLACE OF ORGANIZATION
--------------------------------------------------------------------------
7. SOLE VOTING POWER
NUMBER OF 87,955 shares of Common Stock (includes
SHARES 18,356 shares issuable upon the conversion of
BENEFICIALLY warrants)
OWNED BY --------------------------------------------
EACH 8. SHARED VOTING POWER
REPORTING
PERSON ---------------------------------------------
WITH
PERSON 9. SOLE DISPOSITIVE POWER
87,955 shares of Common Stock (includes
18,356 shares issuable upon the conversion of
warrants)
---------------------------------------------
10. SHARED DISPOSITIVE POWER
--------------------------------------------------------------------------
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
87,955 shares of Common Stock (Includes 18,356 shares issuable upon
the conversion of warrants)
--------------------------------------------------------------------------
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
--------------------------------------------------------------------------
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
2.21%
--------------------------------------------------------------------------
14. TYPE OF REPORTING PERSON
HC
*SEE INSTRUCTIONS BEFORE FILLING OUT!
Page 5 of 65 Pages
STATEMENT PURSUANT TO RULE 13d-1
OF THE
GENERAL RULES AND REGULATIONS
UNDER THE
SECURITIES EXCHANGE ACT OF 1934, AS AMENDED
Item 1. Security and Issuer
Common Stock with no par value
American Shared Hospital Services,
a California Corporation,
4 Embarcadero Center, Suite 3620
San Francisco, California 94111-4155
Item 2. Identify and Background
Sun Life Insurance Company of America
1 SunAmerica Center
Los Angeles, California 90067
Anchor National Life Insurance Company
1 SunAmerica Center
Los Angeles, California 90067
SunAmerica Inc.
1 SunAmerica Center
Los Angeles, California 90067
Sun Life Insurance Company of America ("Sun Life of America")
is an Arizona Stock Insurance Company. The principal business of Sun Life
of America is issuing annuities and guaranteed investment contracts. Sun
Life of America is the parent company of Anchor National Life Insurance
Company ("Anchor National").
Anchor National is a California Stock Insurance Company. The
principal business of Anchor National is issuing annuities and Guaranteed
Investment Contracts.
SunAmerica Inc. ("SunAmerica") is a Maryland Corporation and is
the parent company of Sun Life of America. The principal business of
SunAmerica is to act as a holding company (Sun Life of America, Anchor
National and SunAmerica are collectively referred to herein as the
"Reporting Persons").
During the past five years neither Sun Life of America, Anchor
National nor SunAmerica has been convicted in a criminal proceeding or has
been a party to a civil proceeding of a judicial or administrative body of
competent jurisdiction and as a result of such proceeding been made subject
to a judgment, decree or final order enjoining future violations of, or
prohibiting or mandating activities subject to, Federal or State securities
laws or been found to be in violation of any such laws.
Page 6 of 65 Pages
The executive officers, directors and control persons of Sun
Life of America, Anchor National and SunAmerica are listed in the attached
Exhibits A, B and C, respectively, along with their principal occupations,
the address where their principal occupation is conducted, and their
business addresses. All of the persons listed in Exhibits A, B and C are
U.S. citizens. None of the persons listed in Exhibit A, B or C has been a
party to a civil proceeding of a judicial or administrative body of
competent jurisdiction and as a result of such proceeding been made subject
to a judgment decree or final order enjoining future violations of, or
prohibiting or mandating activities subject to, Federal or State securities
laws or been found to be in violation of any such laws.
Item 3. Source and Amount of Funds or Other Consideration
In connection with a restructuring of the Company, the
Reporting Persons, pursuant to the terms of the Note Purchase Agreement,
dated as of May 12, 1995, by and among the Company and the signatories
thereto (the "Note Purchase Agreement"), were entitled to receive an
aggregate of 557,923 shares (including 116,436 warrants immediately
exercisable upon the payment of an exercise price initially equal to $0.75
per warrant (the "Warrants")) of the Common Stock of the Company. In
exchange for an aggregate of $9,515,000 in principal amount of the
Company's 16 1/2% Senior Subordinated Exchangeable Reset Notes Due 1996
(the "Subordinated Notes") upon consummation of the Note Purchase
Agreement. On May 17, 1995, the terms and conditions of the Note Purchase
Agreement were satisfied, and in connection therewith, the issuance of the
557,923 shares of Common Stock (including 116,436 Warrants) to the
Reporting Persons in exchange for the Subordinated Notes upon consummation
of the Note Purchase Agreement.
The Reporting Persons acquired beneficial ownership of such
shares of the Common Stock and the Warrants by virtue of the distribution
of shares of the Common Stock and the Warrants pursuant to the Note
Purchase Agreement.
The foregoing response to Item 3 is qualified in its entirety
by reference to the Note Purchase Agreement and the Common Stock Purchase
Warrant, the full text of which are filed as Exhibit 1 and Exhibit 2,
respectively hereto, and incorporated herein by this reference.
Item 4. Purpose of Transaction
The Reporting Persons acquired beneficial ownership of the
shares of the Common Stock and the Warrants described in Item 3 to which
this Statement on Schedule 13D relates as a result of the consummation of
the Note Purchase Agreement described in Item 3 above. Such shares of the
Common Stock and the Warrants were acquired in the ordinary course of
business for investment purposes and not with the purpose of changing or
influencing control of the issuer.
Page 7 of 65 Pages
The Reporting Persons may change any of their current
intentions, acquire additional shares of the Common Stock or the Warrants
or sell or otherwise dispose of all or any part of the Common Stock or the
Warrants beneficially owned by the Reporting Persons, or take any other
action with respect to the Company or any of its debt or equity securities
in any manner permitted by law. Except as disclosed in this Item 4, the
Reporting Persons have no current plans or proposals which relate to or
would result in any of the events described in Items (a) through (j) of the
instructions to Item 4 of Schedule 13D.
The foregoing response to this Item 4 is qualified in its
entirety by reference to the Note Purchase Agreement the full text of which
is filed as Exhibit 1 hereto and incorporated herein by this reference.
Item 5. Interest in the Securities of the Issuer
The Reporting Persons acquired beneficial ownership of the
shares of the Common Stock and the Warrants described in Item 3 to which
this Statement on Schedule 13D relates as a result of the consummation of
the Note Purchase Agreement and the distribution of shares of the Common
Stock and the Warrants thereunder.
(a) SunAmerica Inc. beneficially owns 87,955 shares of the
Common Stock (including 18,356 Warrants) or 2.21% of the Common Stock
outstanding. Sun Life Insurance Company of America beneficially owns
190,567 shares of the Common Stock (including 39,770 Warrants) or 4.78% of
the Common Stock outstanding. Anchor National Life Insurance Company
beneficiary owns 279,401 shares of Common Stock (including 58,310 Warrants)
or 7.0% of the Common Stock outstanding. The Reporting Persons
beneficially own, in the aggregate, 557,923 shares of the Common Stock
(including 116,436 Warrants) or 13.99% of the Common Stock outstanding.
Beneficial ownership of such shares was acquired as described in Item 3.
(b) The number of shares of the Common Stock as to which
there is sole power to vote or to direct the vote, shared power to vote or
to direct the vote, sole power to dispose or direct the disposition, or
shared power to dispose or direct the disposition for the Reporting Persons
is set forth in the cover pages and such information is incorporated herein
by this reference.
(c) Except as disclosed in Item 3 herein, there have been no
reportable transactions with respect to the Common Stock within the last 60
days by the Reporting Persons.
(d) The Reporting Persons have the sole right to receive
dividends from, or the proceeds from the sale of, the securities reported
hereon.
(e) Not applicable.
Page 8 of 65 Pages
Item 6. Contracts, Arrangements, Understandings or Relationships
With Respect to the Securities of the Issuer.
The responses to Item 3, Item 4 and Item 5 are incorporated
herein by this reference.
Pursuant to the terms of the Note Purchase Agreement, the
Reporting Persons have, among other things, agreed to vote the shares of
Common Stock acquired thereunder in favor of certain proposals expected to
be put to shareholder vote. In addition, in order to induce the Reporting
Persons and other noteholders to enter into the Note Purchase Agreement,
the Company and such noteholders (including the Reporting Persons) agreed
to enter into a Registration Rights Agreement, dated as of May 17, 1995,
pursuant to which among other things, the Company granted certain
registration rights to the Reporting Persons and the other noteholders and
the Reporting Persons and other noteholders agreed not to sell or otherwise
transfer the Common Stock and Warrants acquired pursuant to the Note
Purchase Agreement until the earlier of September 17, 1995 and the
shareholder vote described above.
The foregoing response to this Item 6 is qualified in its
entirety by reference to the Registration Rights Agreement, the full text
of which is filed as Exhibit 3 hereto, and incorporated herein by this
reference.
Item 7. Material to be Filed as Exhibits
(1) The Note Purchase Agreement, dated as of May 12, 1995.
(2) Form of Common Stock Purchase Warrant, dated as of May
17, 1995.
(3) The Registration Rights Agreement, dated as of May 17,
1995.
Page 9 of 65 Pages
Exhibit A
Sun Life Insurance Company of America (AZ)
Name PRINCIPAL OCCUPATION
Directors: Eli Broad, Chairman (1) see below
James R. Belardi (1) see below
Lorin M. Fife (1) see below
Jana W. Greer (1) see below
Susan L. Harris (1) see below
Gary W. Krat (1) see below
Clark P. Manning, Jr. (1) see below
Peter McMillan (1) Executive Vice President & Chief
Investment Officer of SunAmerica
Investments, Inc.
Scott L. Robinson (1) see below
Jay S. Wintrob (1) see below
Officers: Eli Broad (1) President and Chief Executive
Officer of Sun Life Insurance
Company of America ("Sun Life of
America") and Anchor National
Life Insurance Company ("Anchor
National")
Jay S. Wintrob (1) Executive Vice President of Sun
Life of America and Anchor
National
James R. Belardi (1) Senior Vice President and
Treasurer of Sun Life of America
and Anchor National
Lorin M. Fife (1) Senior Vice President, General
Counsel and Assistant Secretary
of Sun Life Insurance Company of
America and Anchor National
Jana W. Greer (1) Senior Vice President of Sun Life
of America and Anchor National
Susan L. Harris (1) Senior Vice President and
Secretary of Sun Life of America
and Anchor National
Gary W. Krat (1) Senior Vice President of Sun Life
of America and Anchor National
Clark P. Manning, Jr. (1) Senior Vice President of Sun Life
of America and Anchor National
Scott L. Robinson (1) Senior Vice President of Sun Life
of America and Anchor National
N. Scott Gillis (1) Vice President and Controller of
Sun Life of America and Anchor
National
Scott H. Richland (1) Vice President and Assistant
Treasurer of Sun Life of America
and Anchor National
Page 10 of 65 Pages
Edwin R. Reoliquio (1) Senior Vice President and Actuary
of Sun Life of America and Anchor
National
Victor E. Akin (1) Vice President of Sun Life of
America and Anchor National
Michael L. Fowler (1) Vice President of Sun Life of
America and Anchor National
J. Franklin Grey (1) Vice President of Sun Life of
America and Anchor National
Keith B. Jones (1) Vice President of Sun Life of
America and Anchor National
Michael Lindquist (1) Vice President of Sun Life of
America and Anchor National
Edward P. Nolan (1) Vice President of Sun Life of
America and Anchor National
Gregory M. Outcalt (1) Vice President of Sun Life of
America and Anchor National
James W. Rowan (1) Vice President of Sun Life of
America and Anchor National
-----------------------------------------------------
(1) Business address and address where principal occupation is
located is 1 SunAmerica Center, Los Angeles, California 90067.
Page 11 of 65 Pages
Exhibit B
Anchor National Life Insurance Company (CA)
Name PRINCIPAL OCCUPATION
Directors: Eli Broad, Chairman (1) see below
James R. Belardi (1) see below
Lorin M. Fife (1) see below
Jana W. Greer (1) see below
Susan L. Harris (1) see below
Gary W. Krat (1) see below
Clark P. Manning, Jr. (1) see below
Peter McMillan (1) Executive Vice President & Chief
Investment Officer of SunAmerica
Investments, Inc.
Scott L. Robinson (1) see below
Jay S. Wintrob (1) see below
Officers: Eli Broad (1) President and Chief Executive
Officer of Sun Life Insurance
Company of America ("Sun Life of
America") and Anchor National
Life Insurance Company ("Anchor
National")
Jay S. Wintrob (1) Executive Vice President of Sun
Life of America and Anchor
National
James R. Belardi (1) Senior Vice President and
Treasurer of Sun Life of America
and Anchor National
Lorin M. Fife (1) Senior Vice President, General
Counsel and Assistant Secretary
of Sun Life Insurance Company of
America and Anchor National
Jana W. Greer (1) Senior Vice President of Sun Life
of America and Anchor National
Susan L. Harris (1) Senior Vice President and
Secretary of Sun Life of America
and Anchor National
Gary W. Krat (1) Senior Vice President of Sun Life
of America and Anchor National
Clark P. Manning, Jr. (1) Senior Vice President of Sun Life
of America and Anchor National
Scott L. Robinson (1) Senior Vice President of Sun Life
of America and Anchor National
N. Scott Gillis (1) Vice President and Controller of
Sun Life of America and Anchor
National
Scott H. Richland (1) Vice President and Assistant
Treasurer of Sun Life of America
and Anchor National
Page 12 of 65 Pages
Edwin R. Reoliquio (1) Senior Vice President and Actuary
of Sun Life of America and Anchor
National
Victor E. Akin (1) Vice President of Sun Life of
America and Anchor National
Michael L. Fowler (1) Vice President of Sun Life of
America and Anchor National
J. Franklin Grey (1) Vice President of Sun Life of
America and Anchor National
Keith B. Jones (1) Vice President of Sun Life of
America and Anchor National
Michael Lindquist (1) Vice President of Sun Life of
America and Anchor National
Edward P. Nolan (1) Vice President of Sun Life of
America and Anchor National
Gregory M. Outcalt (1) Vice President of Sun Life of
America and Anchor National
James W. Rowan (1) Vice President of Sun Life of
America and Anchor National
-------------------------------------------------
(1) Business address and address where principal occupation is
located is 1 SunAmerica Center, Los Angeles, California 90067.
Page 13 of 65 Pages
Exhibit C
SunAmerica Inc. (MD)
Name PRINCIPAL OCCUPATION
Directors: Eli Broad (1) see below
Ronald J. Arnault (2) Executive Vice President and CFO
of Atlantic Richfield Company
Karen Hastie-Williams (3) Attorney with Crowell & Moring
David O. Maxwell (4) Retired
Barry Munitz (5) Chancellor of the California
State University and Colleges
Lester Pollack (6) Chief Executive Officer, Center
Partners, L.P.
Carl E. Reichardt (7) Retired
Richard D. Rohr (8) Managing Partner, Bodman, Longley
& Dahling
Sanford C. Sigoloff (9) Chairman, President and Chief
Executive Officer of Sigoloff &
Associates
Harold M. Williams (10) Chief Executive Officer, J. Paul
Getty Trust
Officers: Eli Broad (1) Chief Executive Officer and
President of SunAmerica Inc.
("SunAmerica")
Jay S. Wintrob (1) Vice Chairman of SunAmerica
Joseph M. Tumbler (1) Vice Chairman of SunAmerica
Jana W. Greer (1) Senior Vice President of
SunAmerica
Gary W. Krat (1) Senior Vice President of
SunAmerica
Clark P. Manning, Jr. (1) Senior Vice President of
SunAmerica
Scott L. Robinson (1) Senior Vice President and
Controller of SunAmerica
James R. Belardi (1) Senior Vice President and
Treasurer of SunAmerica
Karel Carnohan (1) Vice President of SunAmerica
Darlene Chandler (1) Vice President of SunAmerica
Lorin M. Fife (1) Vice President & General Counsel-
Regulatory Affairs of SunAmerica
Michael L. Fowler (1) Vice President of SunAmerica
Susan L. Harris (1) Vice President, General Counsel-
Corporate Affairs & Secretary of
SunAmerica
Scott H. Richland (1) Vice President and Assistant
Treasurer of SunAmerica
James W. Rowan (1) Vice President of SunAmerica
Richard D. Rohr (8) Assistant Secretary of SunAmerica
Page 14 of 65 Pages
(1) Business address and address where principal occupation is
located is 1 SunAmerica Center, Los Angeles, California 90067.
(2) Business address and address where principal occupation is
located is 515 South Flower Street, 51st Floor, Los Angeles,
California 90071.
(3) Business address and address where principal occupation is
located is Suite 1100, 1001
Pennsylvania Avenue, N.W., Washington, D.C. 20004-2505.
(4) Business address and address where principal occupation is
located is 5335 Wisconsin Avenue, NW, Suite 440, Washington,
D.C. 20015-2003.
(5) Business address and address where principal occupation is
located is 400 Golden Shore, Suite 324, Long Beach, CA 90802-
4275.
(6) Business address and address where principal occupation is
located is One Rockefeller Plaza, Suite 1025, New York, New
York 10020.
(7) Business address and address where principal occupation is
located is 420 Montgomery Street, San Francisco, California
94104
(8) Business address and address where principal occupation is
located is 100 Renaissance Center, 34th Floor, Detroit,
Michigan 48243.
(9) Business address and address where principal occupation is
located is 3340 Ocean Park Boulevard, Suite 3050, Santa Monica,
CA 90405.
(10) Business address and address where principal occupation is
located is 401 Wilshire Boulevard, Suite 900, Santa Monica,
California 90401.
Page 15 of 65 Pages
JOINT FILING AGREEMENT PURSUANT TO RULE 13d-1(f)(1)
This agreement is made pursuant to Rule 13d-1(f)(1) under the Securities
Exchange Act of 1934 (the "Act") by and between the parties listed below,
each referred to herein as a "Joint Filer." The Joint Filers agree that a
statement of beneficial ownership as required by Section 13(d) of the Act
and the Rules thereunder may be filed on each of their behalf on Schedule
13D or Schedule 13G, as appropriate, and that said joint filing may
thereafter be amended by further joint filings. The Joint Filers state
that they each satisfy the requirements for making a joint filing under
Rule 13d-1.
Sun Life Insurance Company of America
/s/ Jay S. Wintrob
=======================
Executive Vice President
SunAmerica Inc.
/s/ Jay S. Wintrob
========================
Vice Chairman
Anchor National Life Insurance Company
/s/ Jay S. Wintrob
========================
Executive Vice President
Page 16 of 65 Pages
EXHIBIT INDEX
Exhibit No. Description Sequentially
Numbered Page
1 Note Purchase Agreement 17
2 Form of Common Stock Purchase Warrant 33
3 Registration Rights Agreement 44
Page 17 of 65 Pages
Exhibit 1
NOTE PURCHASE AGREEMENT
This NOTE PURCHASE AGREEMENT (the "Agreement"), dated as of May
12, 1995, is made by and among ANCHOR NATIONAL LIFE INSURANCE COMPANY, a
California corporation, SUN LIFE INSURANCE COMPANY OF AMERICA, an Arizona
corporation, and SUNAMERICA INC., a Maryland corporation (collectively,
"SunAmerica"), AIF II, L.P., a Delaware limited partnership, LION ADVISORS,
L.P., a Delaware limited partnership, on behalf of an account under manage-
ment (together with AIF II, L.P., "Apollo"), GRACE BROTHERS, LTD., an
Illinois limited partnership ("Grace") and UPCHURCH LIVING TRUST U/A/D
12/14/90 ("Upchurch") (each a "Holder," and collectively, the "Holders"),
AMERICAN SHARED HOSPITAL SERVICES, a California corporation (the "Company")
and Ernest A. Bates, M.D. ("Dr. Bates").
WHEREAS, the Company has not made interest payments with
respect to its 14-3/4% Senior Subordinated Notes due 1996 (the "14-3/4%
Notes") and its Senior Subordinated Exchangeable Reset Notes due 1996 (the
"16-1/2% Notes" and together with the 14-3/4% Notes, the "Notes") since
April 15, 1992; and
WHEREAS, the Holders, severally and not jointly, are the
beneficial owners of certain of the Notes; and
WHEREAS, the parties hereto entered into an Exchange Agreement,
dated as of February 14, 1995 (the "Exchange Agreement") providing for a
comprehensive restructuring of the Company's obligations including (a) an
exchange offer and certain other transactions contemplated by the Exchange
Agreement (the "Exchange Offer"), providing for, among other things, the
exchange of 1,969.3556 shares of Common Stock (as defined below) for each
$1,000 principal amount (and accrued interest thereon) of the 14-3/4% Notes
held by the Holders and 2,020.7943 shares of Common Stock for each $1000
principal amount (and accrued interest thereon) of the 16-1/2% Notes held
by the Holders, as described in the Company's proxy statement dated
February 14, 1995 (the "Proxy Statement") and (b) the modification of cer-
tain equipment leases and certain related transactions between the Company
and its subsidiaries on the one hand and General Electric Company, acting
through GE Medical Systems on the other hand, as described in the Proxy
Statement (the "GE Lease Modification" and, together with the Exchange
Offer, the "Restructuring Transactions");
WHEREAS, the Company has proposed a purchase of the Holders'
Notes (the "Note Purchase") for cash and equity in lieu of the
Restructuring Transactions; and
WHEREAS, the Company and the Holders' desire to amend the
Exchange Agreement to, among other things, provide that the Exchange
Agreement shall terminate upon consummation of the Note Purchase.
NOW THEREFORE, the parties hereby agree as follows:
Page 18 of 65 Pages
SECTION 1. The Note Purchase
Section 1.1 Agreement to Sell and to Purchase
(a) Subject to the terms and conditions hereof, each of the
Holders, severally and not jointly, shall sell to the Company, and the
Company shall purchase from each Holder, such principal amount of Notes,
the Company shall, in consideration therefore pay to each Holder, on the
Closing Date, the amount of cash, and number of shares of Common Stock and
warrants to purchase Common Stock, which shall be substantially in the form
of Exhibit A hereto and immediately exercisable upon the payment of an
exercise price initially equal to $0.75 (the "Warrants") as set forth
below:
Shares of Common
Common Stock
Holder Notes Cash Stock Warrants
------ ----- ---- --------- --------
SunAmerica $9,515,000 $2,098,372.45 441,487 116,436
Apollo $6,500,000 $1,433,465.15 301,594 79,541
Grace $1,600,000 $ 343,864.65 72,347 19,081
Upchurch $ 79,000 $ 16,978.32 3,572 942
(b) Subject to the terms and conditions hereof, if the
Company issues additional equity to Dr. Bates as described in the letter
agreement dated May 5, 1995 (the "Letter Agreement") among the Company,
Apollo and SunAmerica (the "Additional Issuance") after the Closing Date,
the Company shall, in consideration for the Notes purchased pursuant to
this Section 1, concurrently issue to each Holder such number of additional
Warrants and shares of Common Stock (the "Delayed Securities") as set forth
in Exhibit A to the Letter Agreement (and in any event sufficient Delayed
Securities so that each such Holder thereafter holds the same percentage of
the outstanding Common Stock (assuming full exercise of the Warrants)).
Section 1.2. Closing
The closing of the Note Purchase (the "Closing") shall take
place at 2:00 p.m., local time, on May 17, 1995, or such other date as the
parties hereto shall agree in writing (the "Closing Date"), at the offices
of Sidley & Austin, Los Angeles, California or at such other place as the
parties hereto shall agree in writing.
At the Closing (a) each Holder shall deliver (i) either (A)
certificates, duly endorsed for transfer, or (B) by book-entry transfer
into the indenture trustee's account at The Depository Trust Company, of
the Notes being delivered by such Holder pursuant to Section 1.1, (ii) duly
executed consents with respect to each Note substantially in the form of
Exhibit A to the Exchange Agreement (the "Consents"), and (iii) executed
letters of withdrawal or resignation from the Board of Directors of the
Company from each of the persons nominated by the Holders, and (b) the
Company shall (i) deposit into bank accounts, designated by each Holder, by
wire transfer of immediately available funds, an amount equal to the
Page 19 of 65 Pages
aggregate cash portion of the purchase price being paid to such Holder
pursuant to Section 1.1 above, and (ii) deliver to each Holder (x) a stock
certificate or certificates representing the number of duly authorized,
validly issued, fully paid and nonassessable shares of Common Stock
specified pursuant to Section 1.1 above, and (y) a warrant certificate or
certificates substantially in the form of Exhibit A representing the War-
rants specified pursuant to Section 1.1 above. Concurrently with the
closing of any Additional Issuance the Company shall deliver to each Holder
a stock certificate or certificates representing the number of duly
authorized, validly issued, fully paid and nonassessable shares of Common
Stock and a warrant certificate or certificates representing the duly
authorized and validly issued Warrants comprising the Delayed Securities
issuable on such date. The certificates representing the shares of Common
Stock and the Warrants shall be in definitive form and registered in the
name of the Holder or its nominee or designee and in such denominations as
such Holder shall request not later than one business day prior to the
Closing Date or the closing date of an Additional Issuance as the case may
be.
SECTION 2. Amendment of Exchange Agreement
(a) The last sentence of Section 1(a)(ii) of the
Exchange Agreement is hereby amended in its entirety by substituting
therefore the following:
"The Consents shall not be effective for any pur-
pose until immediately prior to the consummation of the
Exchange Offer and shall be returned to the respective Holders
who executed such instruments at the close of business on
May 25, 1995, if the Exchange Offer has not been consummated."
(b) Section 1(b) of the Exchange Agreement is hereby
amended in its entirety by substituting therefore the following:
"(b) The Company hereby agrees to cause all of the Notes
tendered into the Exchange Offer to be returned to the respective Holders
thereof at the close of business on May 25, 1995, if the Exchange Offer has
not been consummated."
(c) Section 2.1(o) of the Exchange Agreement is hereby
amended in its entirety by substituting therefore the following:
"the Company and CuraCare, Inc., on the one hand, and DVI
Financial Services, Inc. and DVI Business Credit, Inc. (collectively,
"DVI"), on the other hand, shall have entered into a permanent credit
facility in accordance with the terms of DVI's letter to the Company dated
April 28, 1995 and in accordance with the intercreditor arrangements with
GE as set forth in GE's letter to the Company dated April 21, 1995;"
(d) Section 5 of the Exchange Agreement is hereby
amended by adding the following immediately after Section 5.4 thereof:
Page 20 of 65 Pages
"5.5 Shareholders Meeting
The Company hereby agrees that it will (i) recon-
vene the April 7, 1995 shareholders meeting on May 18, 1995, (ii) not
adjourn such reconvened meeting, and (iii) take the shareholders vote and
all related actions with respect to the matters described in the Proxy
Statement on such date.
5.6 Specific Performance
Each of the Company and Dr. Bates hereby acknowl-
edges and agrees that irreparable harm, for which there may be no adequate
remedy at law and for which the ascertainment of damages would be
difficult, would occur in the event any of the provisions of this Agreement
or any of the Documents or any of the Restructuring Transactions were not
performed in accordance with their specific terms or were otherwise
breached. Consequently, each of the Company and Dr. Bates hereby agrees
that each Holder shall be entitled to an injunction or injunctions to
prevent breaches of the provisions of this Agreement or any other Document
or any of the Restructuring Transactions and to enforce specifically the
terms and provisions hereof or thereof in any court of the United States or
any state thereof having jurisdiction, in each instance without being
required to post bond or other security and in addition to, and without
having to prove the inadequacy of, other remedies at law."
(e) Section 6.1(d) of the Exchange Agreement is hereby
amended in its entirety by substituting therefore the following:
"(d) automatically on the earlier of (i) the
closing of the purchase of the Notes held by each Holder
pursuant to the Note Purchase Agreement, dated as of May 12,
1995, by and among the parties hereto and (ii) May 25, 1995 or
such earlier date on or after May 15, 1995 designated by Apollo
and SunAmerica in a written notice to the Company."
(f) Except as expressly set forth herein, all terms and
conditions of the Exchange Agreement shall remain unaffected. All
references to the term "Agreement" therein shall be deemed to refer to the
Exchange Agreement as modified hereby.
SECTION 3. Closing Conditions
Section 3.1 Conditions to Obligations of Holders
The obligations of the Holders pursuant to Section 1 hereof are
subject to the satisfaction of each of the following conditions:
(a) The expiration or termination of any waiting period
(and any extension thereof) applicable to the consummation of the Note
Purchase or any of the transactions contemplated hereby (collectively, the
"Purchase Transactions") under any applicable law;
Page 21 of 65 Pages
(b) the delivery of a certificate or certificates, dated
the Closing Date and signed by the Chairman of the Board of Directors and
the Chief Financial Officer of the Company, certifying (A) that the
conditions set forth in Sections 3.1(h) and 3(j) hereof have been satisfied
and (B) such other matters as each of the Holders may reasonably request;
(c) the delivery of an opinion, dated the Closing Date
and addressed to each Holder, from Sidley & Austin, counsel to the Company,
substantially in the form of Exhibit B hereto;
(d) the delivery of a certificate, dated as of a recent
date and signed by the Company's stock transfer agent, certifying the
number of outstanding Shares of Common Stock;
(e) all fees and expenses incurred in connection with
the negotiation of the Restructuring Transactions and the negotiation and
consummation of the Note Purchase and the other Purchase Transactions
including, without limitation, the fees and expenses of legal counsel
representing Apollo and SunAmerica shall have been paid in full;
(f) there shall have been no order or preliminary or
permanent injunction entered in any action, claim or proceeding and no law
enacted, entered, enforced, promulgated, amended, issued or deemed
applicable to (A) the Holders, the Company or any subsidiary or affiliate
of the Company or the Holders or (B) the Note Purchase, which shall have
remained in effect and which shall have had the effect of: (1) making
illegal, materially delaying or otherwise directly or indirectly
prohibiting or making materially more costly the consummation of the Note
Purchase or the other Purchase Transactions; (2) prohibiting or materially
limiting the ownership of the Company's Common Stock by any of the Holders;
(3) compelling the Company, the Holders or any of their respective
affiliates to dispose of or hold separate all or any material portion of
the business or assets of the Company, the Holders or any of their
respective affiliates, as a result of the Note Purchase; or (4) requiring
divestiture by any Holder or any affiliate of any Holder of any Warrants or
shares of Common Stock;
(g) as of the Closing Date, each of the employees of the
Company listed on Schedule A to the Exchange Agreement (each a "Key Employ-
ee") shall continue to be employed by the Company in the capacity indicated
on Schedule A to the Exchange Agreement;
(h) the representations and warranties contained in
Section 4 of this Agreement shall be true and correct at and as of the
Closing Date;
(i) as of the date of the Proxy Statement and as of the
Closing Date, none of the Proxy Statement or any amendment or supplement
thereto contains or will contain an untrue statement of a material fact or
omit to state a material fact necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading;
Page 22 of 65 Pages
(j) subsequent to the date hereof (A) there has been no
material adverse effect on the condition, financial or otherwise, or in the
earnings or business affairs or business prospects ("Material Adverse
Effect") of the Company or its subsidiaries, whether or not arising in the
ordinary course of business, the occurrence of which gives rise to an
obligation of the Company to amend, supplement or otherwise revise the dis-
closure provided in the Proxy Statement, (B) without the prior written con-
sent of each of the Holders, the Company has not incurred any material lia-
bilities or obligations, direct or contingent, nor entered into any
material transaction not in the ordinary course of business, or required to
be disclosed on a balance sheet prepared in accordance with GAAP, either
when considered alone or together with all other such transactions, and (C)
there has been no dividend or distribution of any kind declared, paid or
made by the Company on its capital stock;
(k) the Note Purchase shall not be prohibited by any
applicable law;
(l) each of the Holders shall participate in the Note
Purchase in accordance with Section 1 hereof;
(m) the Company and CuraCare, Inc., on the one hand, and
DVI Financial Services, Inc. and DVI Business Credit, Inc. (collectively,
"DVI"), on the other hand, shall have entered into a permanent credit
facility in accordance with the terms of DVI's letter to the Company dated
April 28, 1995 and in accordance with the intercreditor arrangements with
GE as set forth in GE's letter to the Company dated April 21, 1995 (the DVI
Facility");
(n) the GE Lease Modification shall continue to remain
in effect, an Event of Default (as defined in the documents relating to the
GE Lease Modification) shall not have occurred and be continuing and any
amendment thereto shall be under terms reasonably acceptable to each of the
Holders; and
(o) the Company and the Holders shall have entered into
a registration rights agreement substantially in the form of Exhibit C
hereto (the "Registration Rights Agreement").
Section 3.2 Conditions to Obligations of the Company
(a) the expiration or termination of any waiting period
(and any extension thereof) applicable to the consummation of the Note
Purchase and the Purchase Transactions under any applicable law;
(b) there shall have been no order or preliminary or
permanent injunction entered in any action, claim or proceeding and no law
enacted, entered, enforced, promulgated, amended, issued or deemed applica-
ble to (A) the Holders, the Company or any subsidiary or affiliate of the
Company or the Holders or (B) the Note Purchase, which shall have remained
in effect and which shall have had the effect of: (1) making illegal,
materially delaying or otherwise directly or indirectly prohibiting or
Page 23 of 65 Pages
making materially more costly the consummation of the Note Purchase or the
other Purchase Transactions; (2) prohibiting or materially limiting the
ownership of the Company's Common Stock by any of the Holders; (3) compel-
ling the Company, the Holders or any of their respective affiliates to
dispose of or hold separate all or any material portion of the business or
assets of the Company, the Holders or any of their respective affiliates,
as a result of the Note Purchase; or (iv) requiring divestiture by any
Holder or any affiliate of any Holder of any Warrants of shares of Common
Stock; and
(c) the Note Purchase shall not be prohibited by any
applicable law;
(d) each of the Holders shall participate in the Note
Purchase in accordance with Section 1 hereof; and
(e) each of the persons nominated by the Holders shall
have withdrawn or resigned from the Company's Board of Directors;
(f) each of the Holders shall have provided the
Consents; and
(g) DVI shall have agreed to enter into the DVI
Facility.
SECTION 4. Representations and Warranties
The Company represents and warrants to each Holder as follows:
Section 4.1 Capitalization
(a) The total authorized capital stock of the Company
consists of 10,000,000 shares of common stock, no par value (the "Common
Stock"), 2,867,401 of which are issued and outstanding on the date hereof.
Each share of the Company's capital stock that is issued and outstanding
(i) has been duly authorized and validly issued and (ii) is fully paid and
nonassessable and free of preemptive and similar rights.
(b) Upon consummation of the Note Purchase, and upon
each issuance of Delayed Securities, each Holder will acquire valid title
to the shares of Common Stock and Warrants being acquired by it, free and
clear of all liens and restrictions on voting and transfer other than (x)
restrictions on transfer imposed by Federal and state securities laws, (y)
liens or restrictions on voting and transfer arising from the actions of
any Holder, and (z) as set forth in this Agreement and the Registration
Rights Agreement.
Page 24 of 65 Pages
(c) The Common Stock and Warrants to be issued as
consideration for the Notes (including the Delayed Securities, if any) have
been duly authorized and, upon consummation of the Note Purchase, and upon
each issuance of Delayed Securities, will be validly issued, fully paid and
nonassessable and free of preemptive or similar rights, and the Common
Stock issuable upon exercise of the Warrants (the "Warrant Shares") has
been duly authorized and, when issued upon such exercise in accordance with
the terms thereof, will be validly issued, fully paid and nonassessable and
free of preemptive or similar rights. A sufficient number of shares of
Common Stock have been reserved solely for issuance and delivery upon exer-
cise of the Warrants.
(d) Except for this Agreement, the warrants to purchase
an aggregate of 225,000 shares of Common Stock issued or to be issued in
connection with the GE Lease Modification and the DVI Facility, the shares
of Common Stock to be issued in the Additional Issuance, and options grant-
ed pursuant to and listed in the Proxy Statement and referred to in Exhibit
A to the Letter Agreement, there are, and immediately following the Closing
Date there will be, no outstanding (i) securities convertible into or ex-
changeable for any capital stock of the Company or any subsidiary of the
Company, (ii) options, warrants or other rights to purchase or subscribe to
capital stock of the Company or any subsidiary of the Company or securities
convertible into or exchangeable for capital stock of the Company of any
subsidiary of the Company, or (iii) contracts, commitments, agreements,
understandings, arrangements, calls or claims of any kind, to which the
Company or any of its subsidiaries is a party or that arise from any action
of the Company or any of its subsidiaries, relating to the issuance of any
capital stock of the Company or any subsidiary of the Company, any such
convertible or exchangeable securities or any such options, warrants or
rights.
Section 4.2 Authorization of Agreement
The execution and delivery of this Agreement and the other
documents relating to the transactions contemplated hereby (the "Docu-
ments") to which the Company or any subsidiary of the Company is a party,
and the consummation of the transactions contemplated hereby or thereby
have been duly authorized by the Company and no other proceedings on the
part of any of the Company, any subsidiary of the Company or any of their
respective stockholders or affiliates are necessary to authorize this
Agreement or the other Documents or to consummate the transactions
contemplated hereby or thereby. This Agreement is, and as of the Closing
Date, each of the Documents to which the Company or any subsidiary of the
Company is a party will be, a valid and binding obligation of the Company
or such subsidiary, as the case may be, enforceable in accordance with its
terms, except to the extent that enforcement thereof may be limited by
bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance
or other similar laws affecting enforcement of creditor's rights generally,
and by general principles of equity (regardless of whether enforcement is
considered in a proceeding at law or in equity).
Page 25 of 65 Pages
Section 4.3 No Violation
Neither the execution or delivery by the Company or any of its
subsidiaries of the Documents to which it is a party, the performance by
each of the Company and each of its subsidiaries of its obligations under
this Agreement and the other Documents, nor the consummation of the
transactions contemplated hereby or thereby will (i) constitute a breach or
violation under the Charter Documents of the Company or any of its
subsidiaries, or (ii) constitute a violation of any Applicable Law, in each
case as defined in the Exchange Agreement.
Section 4.4 No Default
(a) No Event of Default (as defined in each of the
Documents) has occurred, which Event of Default could, singly or in the
aggregate, have a Material Adverse Effect on the Company after the date on
which the Purchase transactions are consummated. There exists no condition
that, with the passage of time or otherwise, would (i) except as set forth
in the Proxy Statement, result in a default by the Company or any of its
subsidiaries under any agreement, which default could, singly or in the
aggregate, have a Material Adverse Effect on the Company after the date on
which the transactions contemplated hereby or thereby are consummated, or
(ii) except as set forth in the Proxy Statement on the date hereof, result
in the imposition of any penalty or the acceleration of any indebtedness or
obligation which could, singly or in the aggregate, have a Material Adverse
Effect on the Company.
(b) Neither the execution or delivery by the Company or
any of its subsidiaries of the Documents to which it is a party, the
performance by any of the Company or any of its subsidiaries of its
obligations under this Agreement and the other Documents, nor the
consummation of the transactions contemplated hereby or thereby will
conflict with, violate, constitute a breach or violation of or a default
(with the passage of time or otherwise) under, require the consent of any
person under, give to others any rights of termination, amendment,
acceleration or cancellation of or result in the imposition of a lien on
any of the properties or assets of any of the Company's subsidiaries or an
acceleration of indebtedness pursuant to, any material agreement, except
for such conflicts, violations, breaches or defaults (i) for which consents
have already been obtained; and (ii) which could not, singly or in the
aggregate, have a Material Adverse Effect on the Company.
Section 4.5 Representations and Warranties in the Exchange Agreement
The representations and warranties of the Company in the
Exchange Agreement were true on the date thereof, are true on the date
hereof and will be true on the Closing Date after giving effect to the
transactions contemplated by this Agreement and the other Documents.
Page 26 of 65 Pages
Section 4.6 Proposed Restructurings
Neither the Company nor any of its subsidiaries is currently
contemplating or has taken any action with respect to any liquidation,
bankruptcy, dissolution or other reorganization proceedings except as
contemplated by the Purchase Transactions and the Restructuring
Transactions.
SECTION 5. Representations and Warranties of each of the Holders
Each of the Holders, severally and not jointly, represents and
warrants to the Company as follows:
Section 5.1 Authorization of Agreement
The execution and delivery of this Agreement and the per-
formance of its obligations hereunder have been duly authorized by such
Holder and no other proceedings on the part of any such Holder or any of
its respective stockholders or affiliates are necessary to authorize this
Agreement or to consummate the Note Purchase. This Agreement is a valid
and binding obligation of such Holder, enforceable in accordance with its
terms, except to the extent that enforcement thereof may be limited by
bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance
or other similar laws affecting enforcement of creditor's rights generally,
and by general principles of equity (regardless of whether enforcement is
considered in a proceeding at law or in equity).
Section 5.2 Title to Notes
As of the date hereof, each of the Holders beneficially owns
free and clear of all claims, liens, charges, encumbrances, options and
security interests, to the Notes in the principal amount set forth below:
Principal
Amount of Notes
SunAmerica $9,515,000
Apollo $6,500,000
Grace $1,600,000
Upchurch $ 79,000
Section 5.3 Private Placement
(a) Such Holder understands that the Note Purchase is
intended to be exempt from registration under the Securities Act of 1933,
as amended (the "Securities Act").
Page 27 of 65 Pages
(b) The shares of Common Stock and Warrants (including
the Delayed Securities, if any) to be acquired by such Holder in the Note
Purchase are being acquired for its own account for investment and without
a view to making a distribution thereof in violation of the Securities Act
or any state securities laws which may be applicable.
(c) Such Holder has sufficient knowledge and experience
in financial and business matters so as to be capable of evaluating the
merits and risks of its investment in such shares of Common Stock and
Warrants (including the Delayed Securities, if any) and such Holder is
capable of bearing the economic risks of such investment, including a
complete loss of its investment.
(d) Such Holder is an "accredited investor" as such term
is defined in Regulation D under the Securities Act.
(e) Such Holder acknowledges that the Company and, for
purposes of the opinions to be delivered to the Holders pursuant to Section
3.1(c) hereof, Sidley & Austin, will rely on the accuracy and truth of its
representations in this Section 5.3, and such Holder hereby consents to
such reliance.
(f) Such Holder acknowledges that upon original issuance
thereof, and until such time as the same is no longer required under the
applicable requirements of the Securities Act, each certificate evidencing
the shares of Common Stock and Warrants being acquired by it (including the
Delayed Securities, if any) shall bear a legend substantially in the form
of Schedule B hereto.
SECTION 6. Other Agreements
Section 6.1 Warrant Shares
The Company hereby agrees that it will (a) not permit the par
value, if any, of any Warrant Shares to exceed the amount payable therefor
upon exercise, and (b) at all times reserve and keep available, solely for
issuance and delivery upon exercise of the Warrants, the number of shares
of Common Stock from time to time issuable upon exercise of the Warrants.
Section 6.2 Supplemental Indentures
The Company hereby agrees to execute and deliver the
Supplemental Indentures.
Section 6.3 Covenants of Holders
Each Holder, severally and not jointly, hereby agrees:
(a) to vote the shares of Common Stock issued to such
Holder pursuant to Section 1 hereof (and held by such Holder on the date of
any such vote) in favor of the Additional Issuance; and
Page 28 of 65 Pages
(b) that the exercise of the proxy granted by Dr. Bates
pursuant to that certain Agreement and Proxy, dated as of the date hereof,
shall constitute such Holder's agreement (i) to waive any then remaining
conditions to the Holders' performance under the Exchange Agreement and
(ii) to perform thereunder, in each case so long as (A) the Company
performs its obligations thereunder and (B) the transactions contemplated
by the Exchange Agreement are consummated on or before May 25, 1995.
Section 6.4 Further Assurances
Each party hereto agrees to use all reasonable efforts to
obtain all consents and approvals, and to do all other things, necessary
for the transactions contemplated by this Agreement on or prior to the
termination of this Agreement pursuant to Section 7.1 hereof. The parties
agree to take such further action and to deliver or cause to be delivered
to each other at the closing and at such other times thereafter as shall be
reasonably agreed by such additional agreements or instruments as any of
them may reasonably request for the purpose of carrying out this Agreement
and the agreements and transactions contemplated hereby.
SECTION 7. Miscellaneous
Section 7.1 Termination
This Agreement may be terminated and the Note Purchase may be
abandoned at any time prior to the closing (provided that any such
termination or consummation of the Exchange Offer shall not relieve any
party from liability for a breach of any provision hereof prior to such
termination):
(a) by the unanimous written consent of the Company, Dr.
Bates and the Holders;
(b) by the Holders if (i) any representation, warranty,
covenant or agreement of the Company or Dr. Bates contained in this
Agreement or any of the other Documents shall have been breached in any
material respect (other than those qualified by a materiality standard
which shall have been breached in any respect); or (ii) the Company's board
of directors fails to approve this Agreement or the Note Purchase and the
other transactions contemplated hereby and by the other Documents; and
(c) automatically on May 17, 1995, unless otherwise
extended by the Holders in their sole discretion.
Termination pursuant to the foregoing clause (a), (b) or
(c) notwithstanding, Sections 2 and 6.3(b) hereof shall remain in effect.
Page 29 of 65 Pages
Section 7.2 Successors and Assigns
This Agreement shall be binding upon and shall inure to the
benefit of any and all successors and assigns of the parties hereto. This
Agreement may not be assigned by any party, by operation of law or
otherwise, without the express prior written consent of each of the other
parties, which consent may be granted or withheld in each such party's sole
discretion; provided, however, that no such consent shall be necessary in
connection with an assignment by Apollo or SunAmerica to any Related Person
of such Holder if such Related Person shall agree to be bound by the terms
of this Agreement. "Related Person" of any Holder means any subsidiary or
affiliate of such Holder or any investment fund, investment account or
investment entity whose investment manager, investment advisor, or princi-
pal thereof, is such Holder, an affiliate of such Holder or an investment
manager, investment advisor or principal of such Holder or affiliate.
Section 7.3 Specific Performance
Each of the Company and Dr. Bates and, with respect to Section
6.3, the Holders hereby acknowledges and agrees that irreparable harm, for
which there may be no adequate remedy at law and for which the
ascertainment of damages would be difficult, would occur in the event any
of the provisions of this Agreement or any of the Documents or any of the
Purchase Transactions were not performed in accordance with their specific
terms or were otherwise breached. Consequently, each of the Company and
Dr. Bates and, with respect to Section 6.3, the Holders hereby agrees that
each party hereto shall be entitled to an injunction or injunctions to
prevent breaches of the provisions of this Agreement or any other Document
or any of the Purchase Transactions and to enforce specifically the terms
and provisions hereof or thereof in any court of the United States or any
state thereof having jurisdiction, in each instance without being required
to post bond or other security and in addition to, and without having to
prove the inadequacy of, other remedies at law.
Section 7.4 Amendment and Waiver
This Agreement may be amended, modified or supplemented, and
waivers or consents to departures from the provisions hereof may be given,
provided that the same are in writing and signed by the parties hereto.
Section 7.5 Counterparts
This Agreement may be executed in any number of counterparts
and by the parties hereto in separate counterparts, each of which when so
executed shall be deemed to be an original and all of which taken together
shall constitute one and the same agreement.
Section 7.6 Headings
The headings in this Agreement are for convenience of reference
only and shall not limit or otherwise affect the meaning hereof.
Page 30 of 65 Pages
Section 7.7 Governing Law
THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF CALIFORNIA, AS APPLIED TO CONTRACTS MADE AND
PERFORMED WITHIN THE STATE OF CALIFORNIA, WITHOUT REGARD TO PRINCIPLES OF
CONFLICT OF LAWS.
Section 7.8 Entire Agreement
This Agreement is intended by the parties as a final expression
of their agreement and intended to be a complete and exclusive statement of
the agreement and understanding of the parties hereto in respect of the
subject matter contained herein and therein. There are no restrictions,
promises, warranties or undertakings, other than those set forth or
referred to herein and therein.
Section 7.9 Severability
If any term, provision, covenant or restriction of this
Agreement is held by a court of competent jurisdiction to be invalid,
illegal, void or unenforceable, the remainder of the terms, provisions,
covenants and restrictions set forth herein shall remain in full force and
effect and shall in no way be affected, impaired or invalidated, and the
parties hereto shall use their best efforts to find and employ an alter-
native means to achieve the same or substantially the same result as that
contemplated by such term, provision, covenant or restriction. It is
hereby stipulated and declared to be the intention of the parties that they
would have executed the remaining terms, provisions, covenants and restric-
tions without including any of such which may be hereafter declared
invalid, void or unenforceable.
Page 31 of 65 Pages
IN WITNESS WHEREOF, the parties have caused this Agreement to
be duly executed and delivered as of the date first above written.
AMERICAN SHARED HOSPITAL SERVICES
By:------------------------------
Its: Chairman and CEO
AIF II, L.P.
By: Apollo Advisors, L.P.
Managing General Partner
By: Apollo Capital Management, Inc.
General Partner
By:------------------------------
Its:-----------------------------
ANCHOR NATIONAL LIFE INSURANCE COMPANY
By:------------------------------
-----------------------------------
Ernest A. Bates, M.D.
Page 32 of 65 Pages
GRACE BROTHERS, LTD.
By:------------------------------
Its:-----------------------------
LION ADVISORS, L.P.
on behalf of an account
under management
By: Lion Capital Management, Inc.
General Partner
By:------------------------------
Its:-----------------------------
SUN LIFE INSURANCE COMPANY OF AMERICA
By:------------------------------
SUNAMERICA INC.
By:------------------------------
Its:-----------------------------
UPCHURCH LIVING TRUST U/A/D 12/14/90
By:------------------------------
Its: Trustee
Page 33 of 65 Pages
Exhibit 2
THIS WARRANT AND ANY SHARES ACQUIRED UPON THE EXERCISE OF THIS WARRANT HAVE
NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR UNDER
ANY STATE SECURITIES LAWS, AND MAY BE OFFERED AND SOLD ONLY IF SO REGIS-
TERED OR AN EXEMPTION FROM REGISTRATION IS AVAILABLE. THE HOLDER OF THIS
WARRANT OR ANY SUCH SHARES MAY BE REQUIRED TO DELIVER TO THE COMPANY, IF
THE COMPANY SO REQUESTS, AN OPINION OF COUNSEL (REASONABLY SATISFACTORY IN
FORM AND SUBSTANCE TO THE COMPANY) TO THE EFFECT THAT AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT (OR QUALIFICATION UNDER STATE
SECURITIES LAWS) IS AVAILABLE WITH RESPECT TO ANY TRANSFER OF THIS WARRANT
OR THESE SHARES THAT HAS NOT BEEN SO REGISTERED (OR QUALIFIED).
AMERICAN SHARED HOSPITAL SERVICES
Common Stock Purchase Warrant
No. W ------- ---- shares
May 17, 1995
AMERICAN SHARED HOSPITAL SERVICES, a California corporation
(together with any corporation that shall succeed to or assume the obliga-
tions of the Company hereunder in compliance with Section 4, the "Compa-
ny"), for value received, hereby certifies that SunAmerica Inc., or its
registered assigns (the "Holder"), is entitled to purchase from the Company
an aggregate of OKGBD & Co. shares of Common Stock (as defined below), at
the Exercise Price (as defined below) per share, subject to the terms,
conditions and adjustments set forth below, in whole or in part, at any
time or from time to time from and after the date hereof and on or prior to
the Expiration Date (defined below).
The following terms shall have the meanings ascribed to them
below:
"Business Day" shall mean any day other than a Saturday or
Sunday or a day on which banking institutions in the State of California
are authorized or obligated by law or executive order to close.
Page 34 of 65 Pages
"Closing Price" with respect to any security on any day shall
mean (i) the closing sale price, regular way, on such day or, in case no
such sale takes place on such day, the average of the reported closing bid
and asked prices, regular way, in each case on the principal national
securities exchange or quotation system on which such security is quoted or
listed or admitted to trading or (ii) if not so quoted or listed, the
average of the closing bid and asked prices of such security on the over-
the-counter market on the day in question as reported by the National
Quotation Bureau Incorporated, or a similar generally accepted reporting
service, or (iii) if not so available, in such manner as furnished by any
New York Stock Exchange member firm selected from time to time by the Board
of Directors, or, to the extent permitted by applicable law, a duly autho-
rized committee thereof (the "Board of Directors") for that purpose.
"Common Stock" shall mean the Common Stock, no par value, of
the Company and any stock into which such Common Stock shall have been
changed or any stock resulting from any reclassification of such Common
Stock.
"Current Market Price" on any day shall mean the average
Closing Price of the Common Stock during the 30 Trading Day period ending
on such day.
"Expiration Date" shall mean May 17, 2002.
"Person" means any individual, corporation, limited liability
company, partnership, joint venture, association, business trust, joint-
stock company, trust, unincorporated organization or government or agency
or political subdivision thereof.
"Record Date" with respect to any dividend or distribution,
shall mean the record date fixed for the determination of stockholders
entitled to receive such dividend or distribution.
"Trading Day" with respect to any Security shall mean (x) if
such security is listed or admitted for trading or quoted on a national
securities exchange or quotation system, a day on which such national
securities exchange is open for business or (y) if such security is not
otherwise listed, admitted for trading or quoted, any Business Day.
2. Exercise of Warrant.
2.1 Manner of Exercise. This Warrant may be exercised by the
Holder hereof, in whole or in part, during normal business hours on any
Business Day, by surrender of this Warrant to the Company at its office
maintained pursuant to Section 9, accompanied by a subscription in substan-
tially the form attached to this Warrant (or a reasonable facsimile there-
of), duly executed by such Holder and, in the case of clause (a) below,
accompanied by payment of the aggregate Exercise Price of the number of
shares of Common Stock designated in such subscription. Payment of such
Exercise Price may be made, at the option of the Holder (a) in cash, by
certified or official bank check payable to the order of the Company, or
Page 35 of 65 Pages
(b) by the Company withholding that number of shares of
Common Stock with an aggregate Closing Price as of the date of exercise
equal to such aggregate Exercise Price.
2.2 When Exercise Effective. Each exercise of this Warrant
shall be deemed to have been effected immediately prior to the close of
business on the Business Day on which this Warrant and the accompanying
subscription shall have been duly surrendered to the Company as provided in
Section 2.1, and at such time the Holder shall be deemed to have become the
holder of record of a number of shares of Common Stock equal to the number
of shares designated in such subscription less, in the case of clause
2.1(b), the number of shares of Common Stock withheld by the Company as
payment therefor.
2.3 Delivery of Stock Certificates, etc. As soon as prac-
ticable after each exercise of this Warrant, in whole or in part, in
accordance with the terms of Section 2.1, the Company shall cause to be
issued in the name of the Holder (or its designee), and delivered to the
Holder (or at its direction),
(a) certificate or certificates for the number of duly
authorized, validly issued, fully paid and nonassessable shares of Common
Stock to which such Holder shall be entitled upon such exercise plus, in
lieu of any fractional share to which such Holder would otherwise be enti-
tled, cash in an amount equal to the same fraction of the Closing Price per
share on the date of such exercise, and
(b) in case such exercise is in part only, a new Warrant
of like tenor, calling in the aggregate on the face or faces thereof for
the number of shares of Common Stock equal to the number of such shares
called for on the face of this Warrant (after giving effect to any
adjustment thereof after the date hereof) minus the number of such shares
designated by the Holder upon such exercise as provided in Section 2.1.
3. Adjustments.
3.1 General. The number of shares of Common Stock that the
Holder shall be entitled to receive upon each exercise hereof shall be
determined by multiplying the number of shares of Common Stock that would
otherwise (but for the provisions of this Section 3) be issuable upon such
exercise, by a fraction (i) the numerator of which is $0.75 and (ii) the
denominator of which is the Exercise Price on the date of such exercise.
The "Exercise Price" shall initially be $0.75 per share;
provided, that the Exercise Price shall be adjusted and readjusted from
time to time as provided in this Section 3; provided, however, that no such
adjustment shall be made to the Exercise Price in connection with the
issuance of (i) up to 1,495,000 shares of Common Stock to the chairman and
chief executive officer of the Company on or prior to May 17, 1996, (ii)
warrants to purchase shares of Common Stock to General Electric Company, a
New York corporation acting through GE Medical Systems ("GE") on or prior
to May 17, 1996, and (iii) options granted to members of management (other
Page 36 of 65 Pages
than the chairman and chief executive officer) pursuant to an incentive
stock option plan approved by a majority of the Company's shareholders to
purchase up to five percent (5%) of the fully-diluted shares of Common
Stock outstanding on the date of adoption of the plan.
3.2 Stock Dividends. If, after the date hereof, the Company
shall declare or pay any dividend on the Common Stock payable in Common
Stock, then, and in each such case, the Exercise Price shall be reduced, as
of the close of business on the Record Date, by multiplying such Exercise
Price by a fraction (a) the numerator of which shall be the number of
shares of Common Stock outstanding at the close of business on such Record
Date and (b) the denominator of which shall be the sum of such number of
shares and the total number of shares constituting such dividend or other
distribution.
3.3 Rights. If, after the date hereof, the Company shall
pay or make a dividend or other distribution on its Common Stock consisting
exclusively of, or shall otherwise issue to all holders of its Common
Stock, rights or warrants entitling the holders thereof to subscribe for or
purchase shares of Common Stock at a price per share less than the Current
Market Price on the Record Date, the Exercise Price shall be reduced, as of
the close of business on the Record Date, by multiplying such Exercise
Price by a fraction (a) the numerator of which shall be the number of
shares of Common Stock outstanding at the close of business on such Record
Date plus the number of shares of Common Stock that the aggregate of the
offering price of the total number of shares of Common Stock so offered for
subscription or purchase would purchase at such Closing Price and (b) the
denominator of which shall be the number of shares of Common Stock
outstanding at the close of business on such record date plus the number of
shares of Common Stock so offered for subscription or purchase. For
purposes of this Section 3.3, the issuance of rights or warrants to
subscribe for or purchase stock or securities convertible into shares of
Common Stock shall be deemed to be the issuance of rights or warrants to
purchase the shares of Common Stock into which such stock or securities are
convertible at an aggregate offering price equal to the aggregate offering
price of such stock or securities plus the minimum aggregate amount (if
any) payable upon conversion of such stock or securities into Common Stock.
3.4 Stock Splits, etc. If, after the date hereof, the
outstanding shares of Common Stock shall be subdivided into a greater
number of shares of Common Stock or combined into a smaller number of
shares of Common Stock by stock split, combination, reclassification or
otherwise, the Exercise Price in effect at the close of business on the day
upon which such subdivision or combination becomes effective shall be
proportionately reduced or increased, such reduction or increase, as the
case may be, to become effective immediately prior to the opening of
business on the day following the day upon which such subdivision or combi-
nation becomes effective.
Page 37 of 65 Pages
3.5 Other Distributions. If, after the date hereof, the
Company shall, by dividend or otherwise, distribute to all holders of
record of its Common Stock evidences of indebtedness, shares of capital
stock, cash or assets (including securities, but excluding any dividend or
distribution for which an adjustment is made pursuant to Section 3.2 or 3.3
above), the Exercise Price shall be reduced, as of the close of business on
the Record Date, by multiplying such Exercise Price by a fraction (a) the
numerator of which shall be the Closing Price per share of Common Stock on
the Record Date less the fair market value on such Record Date, of such
evidences of indebtedness, shares of capital stock, cash and assets that
are distributed to a holder of one share of Common Stock and (b) the
denominator of which shall be such Closing Price per share of the Common
Stock. For purposes of this Section 3.5, any dividend or distribution that
includes shares of Common Stock or rights or warrants to subscribe for or
purchase shares of Common Stock shall be deemed instead to be (1) a
dividend or distribution of the evidences of indebtedness, cash, assets or
shares of capital stock other that such shares of Common Stock, rights or
warrants (so that any Exercise Price reduction required by this Section 3.5
is made) immediately followed by (2) a dividend or distribution of such
shares of Common Stock, rights or warrants (so that there is made any
further Exercise Price reduction required by Section 3.2 or 3.3 hereof).
In lieu of any adjustment to the Exercise Price provided for in
this Section 3.5, the Holder may elect, in its sole discretion, to receive
such dividend or distribution as would be received by a holder of the
number of shares of Common Stock issuable upon the exercise of this War-
rant. Such dividend or distribution shall be declared, ordered, made or
paid at the time such dividend or distribution is declared, ordered, made
or paid on the Common Stock, without any requirement of any exercise
hereof.
3.6 Sales Below Market Price. If, after the date hereof, the
Company shall issue or sell its shares of Common Stock for consideration
per share that is less than the Current Market Price on the Trading Day
next preceding the date of such issuance (unless (i) the provisions of 3.2,
3.3, 3.4 or 3.5 shall be applicable, (ii) such issuance or sale is in
connection with a bona fide underwritten public offering, or (iii) such
issuance or sale is in consideration for assets or ownership interests
acquired by the Company in an arm's length transaction with a bona fide
third party) the Exercise Price shall be adjusted to equal the product of
the Exercise Price in effect immediately prior to such action, multiplied
by a fraction (a) the numerator of which is the Adjusted Fair Market Value
per share and (b) the denominator of which is such Current Market Price.
"Adjusted Fair Market Value" shall mean (i) the sum of (x) the
product of (A) the number of shares of Common Stock outstanding immediately
prior to such issue or sale times (B) the Current Market Price, plus (y)
the consideration, if any, received by the Company upon such issue or sale,
divided by (ii) the number of shares of Common Stock outstanding
immediately after such issue or sale.
Page 38 of 65 Pages
3.7 Minimum Adjustment of Warrant Price. If the amount of
any adjustment of the Exercise Price required pursuant to this Section 3
would be less than one percent (1%) of the Exercise Price in effect at the
time such adjustment is otherwise so required to be made, such amount shall
be carried forward and adjustment with respect thereto made at the time of
and together with any subsequent adjustment which, together with such
amount and any other amount or amounts so carried forward, shall aggregate
at least one percent (1%) of such Exercise Price, provided, that all such
adjustments required pursuant to Section 3 and carried forward under this
Section 3.7 shall be made upon (and in connection with) any exercise of the
Warrant.
3.8 Form of Warrants. Irrespective of any adjustments in the
Exercise Price or the number of shares of Common Stock purchasable upon the
exercise of this Warrant, this Warrant (and any Warrant hereafter issued)
may continue to express the same price and number and kind of shares as are
stated in the Warrant initially issued.
4. Consolidation, Merger, etc. If, after the date hereof,
the Company shall
(a) consolidate with or merge into any other Person and
shall not be the continuing or surviving corporation of such consolidation
or merger, or
(b) permit any other Person to consolidate with or merge
into the Company and the Company shall be the continuing or surviving
Person but, in connection with such consolidation or merger, the Common
Stock shall be changed into or exchanged for stock or other securities of
any other Person or cash or any other property, or
(c) effect a capital reorganization or reclassification
of the Common Stock,
then (i) lawful and adequate provision shall be made so that, upon the
basis and the terms and in the manner provided in this Warrant, the Holder
of this Warrant, upon the exercise hereof after the consummation of such
transaction, shall be entitled to receive, in lieu of the Common Stock
issuable upon such exercise, the kind and amount of securities, cash or
other property to which such Holder would have been entitled upon such con-
summation if such Holder had exercised the rights represented by this
Warrant in full immediately prior thereto and (ii) appropriate provision
shall be made with respect to rights and interests of the Holder to the end
that the provisions hereof (including without limitation provisions for
adjustment of the Exercise Price) shall thereafter be applicable, as nearly
as may be, in relation to any shares of stock, securities or assets
thereafter deliverable upon the exercise of any conversion rights
hereunder.
Page 39 of 65 Pages
5. Certain Covenants. The Company shall (a) not permit the
par value of any shares of stock receivable upon the exercise of this
Warrant to exceed the amount payable therefor upon such exercise, and
(b) take all such action as may be necessary or appropriate to validly and
legally issue fully paid and nonassessable shares of stock on the exercise
of this Warrant.
6. Accountants' Report as to Adjustments. Upon the
occurrence of any event requiring adjustment or readjustment in the
Exercise Price or the shares of Common Stock issuable upon the exercise of
this Warrant, the Company will promptly compute such adjustment or read-
justment in accordance with the terms of this Warrant and cause independent
certified public accountants of recognized national standing (which may be
the regular auditors of the Company) to verify such computation and prepare
a report setting forth such adjustment or readjustment and showing in
reasonable detail the method of calculation thereof and the facts upon
which such adjustment or readjustment is based. The Company will promptly
mail a copy of each such report to the Holder.
7. Payment of Taxes. The Company shall pay any and all
issue or other taxes that may be payable in respect of any issue or
delivery of shares of Common Stock upon exercise of the Warrants. The
Company shall not, however, be required to pay any tax payable in respect
of any transfer involved in the issue or delivery of Warrants or shares of
Common Stock issued upon exercise of the Warrants (or other securities or
assets) in a name other than that in which the Warrants so exercised were
registered.
8. Reservation of Stock, etc. The Company shall at all
times reserve and keep available, solely for issuance and delivery upon
exercise of this Warrant, the number of shares of Common Stock from time to
time issuable upon exercise of this Warrant. All shares of Common Stock
issuable upon exercise of this Warrant shall be duly authorized and, when
issued upon such exercise in accordance with the terms hereof, shall be
validly issued, fully paid and nonassessable, with no liability on the part
of the holders thereof.
9. Ownership and Transfer.
(a) The Company shall treat the person in whose name
this Warrant is registered on the register (the "Warrant Register") kept at
the office of the Company maintained pursuant to this Section 9 as the
owner and holder hereof for all purposes.
(b) This Warrant shall be transferable only on the
Warrant Register, upon delivery hereof, accompanied by a written instrument
or instruments of transfer, duly executed by the registered Holder hereof
or by the duly appointed legal representative hereof or by a duly autho-
rized attorney. Upon the surrender of this Warrant, properly endorsed, for
registration of transfer or for exchange at the office of the Company main-
tained pursuant to Section 9, the Company shall execute and deliver to or
upon the order of the Holder hereof a new Warrant or Warrants of like
Page 40 of 65 Pages
tenor, in the name of such Holder or as such Holder may direct, calling in
the aggregate on the face or faces thereof for the number of shares of Com-
mon Stock called for on the face hereof.
(c) The Company will maintain an office in the State of
California, which office shall initially be at Four Embarcadero Center,
Suite 3620, San Francisco, California 94111-4115, until such time as the
Company shall notify the Holder of any change of location of such office.
(d) If any warrant certificate shall be mutilated, lost,
stolen or destroyed, the Company shall issue and deliver in exchange and
substitution for and upon cancellation of the mutilated certificate, or in
lieu of and substitution for the certificate lost, stolen or destroyed, and
upon receipt of evidence to their reasonable satisfaction of the
destruction, loss or theft of any certificate and such security or
indemnity as may reasonably be required by them to save each of them and
any of their agents harmless, to issue a new certificate of like tenor and
representing an equivalent right or interest.
10. No Rights or Liabilities as Stockholder. Nothing con-
tained in this Warrant shall be construed as conferring upon the Holder any
rights as a stockholder of the Company or as imposing any obligation on
such Holder to purchase any securities or as imposing any liabilities on
such Holder as a stockholder of the Company, whether such obligation or
liabilities are asserted by the Company or by creditors of the Company.
11. Notices. All notices, demands, requests, consents,
approvals or other communications required or permitted to be given hereun-
der or which are given with respect to this Warrant shall be in writing and
shall be personally served or delivered by a reputable air courier service
with charges prepaid, or transmitted by hand delivery, telegram, telex or
facsimile, addressed (a) if to the Holder, at the registered address of
such Holder as set forth in the register kept at the principal office of
the Company, or (b) if to the Company, to the attention of its Chief
Executive Officer at its office maintained pursuant to Section 9, provided
that the exercise of any Warrant shall be effective only in the manner
provided in Section 2. Notice shall be deemed given on the date of service
or confirmation of receipt of transmission if personally served or trans-
mitted by telegram, telex or facsimile. Notice otherwise sent as provided
herein shall be deemed given on the next Business Day following delivery of
such notice to a reputable air courier service.
12. Miscellaneous. This Warrant and any term hereof may be
changed, waived, discharged or terminated only by an instrument in writing
signed by the party against which enforcement of such change, waiver, dis-
charge or termination is sought. This Warrant shall be governed by and
construed in accordance with the laws of the State of California as applied
to contracts made and performed within the State of California without
regard to principles of conflict of laws. Titles and headings of sections
of this Warrant are for convenience only and shall not affect the con-
struction of any provision of this Warrant.
Page 41 of 65 Pages
AMERICAN SHARED HOSPITAL SERVICES
By: -----------------------------
Name:
Title:
Attest
By: ------------------------------------
Name:
Title:
Page 42 of 65 Pages
FORM OF SUBSCRIPTION
[To be executed only upon exercise of Warrant]
To: AMERICAN SHARED HOSPITAL SERVICES
The undersigned registered holder of the within Warrant hereby
irrevocably exercises such Warrant for, and purchases thereunder, ------
shares of Common Stock of AMERICAN SHARED HOSPITAL SERVICES and requests
that the certificates for such shares be issued in the name of, and
delivered to the undersigned, whose address is set forth below. In payment
therefor (check one):
The Company may withhold therefrom, and the undersigned holder hereby
surrenders its right to, that number of shares of Common Stock with an
aggregate Closing Price as of the date of exercise equal to the aggregate
Exercise Price for the shares designated for purchase in the preceding sen-
tence.
The undersigned holder has included a certified or official bank check
payable to the order of the Company in an amount equal to the aggregate
Exercise Price for the shares designated for purchase in the preceding
sentence.
Dated: ----------------------------------------
(Signature must conform in all respects to
name of holder as specified on the face of
Warrant)
------------------------------
(Street Address)
------------------------------
(City) (State) (Zip Code)
Page 43 of 65 Pages
FORM OF ASSIGNMENT
For value received ---------------- hereby sells, assigns and
transfers unto -------------- the within Warrant, together with all right,
title and interest therein, and does hereby irrevocably constitute and
appoint ----------------- attorney, to transfer said Warrant on the books
of the Company, with full power of substitution in the premises.
Dated: -----------------------------------------
--------------------------------------------
Note: The above signature must correspond with the name as written upon the
face of this Warrant in every particular, without alternation or
enlargement or any change whatever.
Signature Guaranteed:
Page 44 of 65 Pages
Exhibit 3
REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement (the "Agreement") is made
pursuant to the Note Purchase Agreement, dated as of May 17, 1995 among
American Shared Hospital Services, a California corporation (the "Compa-
ny"), the Holders referred to therein (the "Note Purchase Agreement") and
General Electric Company, a New York corporation acting through GE Medical
Systems. In order to induce the Holders to enter into the Note Purchase
Agreement, the Company has agreed to provide the registration rights set
forth in this Agreement.
The parties hereby agree as follows:
1. Definitions
Capitalized terms used by not otherwise defined herein shall
have the meaning given thereto in the Note Purchase Agreement. As used in
this Agreement, the following terms shall have the following meanings:
Advice: See Section 5 hereof.
Common Stock: The common stock, no par value, of the Company.
DTC: See Section 5 hereof.
GE Warrant: Warrants to purchase 225,000 shares of Common
Stock.
Losses: See Section 7 hereof.
NASDAQ: See Section 5 hereof.
Person: Any individual, partnership, corporation, joint
venture, association, joint stock company, trust, unincorporated
organization, government or agency or political subdivision thereof, or
other entity.
Piggyback Registration: See Section 3 hereof.
Prospectus: The prospectus included in any Registration
Statement (including, without limitation, a prospectus that discloses
information previously omitted from a prospectus filed as part of an
effective registration statement in reliance upon Rule 430A promulgated
under the Securities Act), as amended or supplemented by any prospectus
supplement, with respect to the terms of the offering of any portion of the
Registrable Securities covered by such Registration Statement and all other
amendments and supplements to the Prospectus, including post-effective
amendments, and all material incorporated by reference or deemed to be
incorporated by reference in such Prospectus.
Page 45 of 65 Pages
Registrable Securities: The Shares and Warrants, upon the
respective original issuance thereof, and at all times subsequent thereto,
until, in the case of any such security, (i) it is effectively registered
under the Securities Act and disposed of in accordance with the Registra-
tion Statement covering it, (ii) it is saleable by the holder thereof
pursuant to Rule 144(k) or (iii) it is distributed to the public pursuant
to Rule 144.
Registration Expenses: See Section 6 hereof.
Registration Statement: Any registration statement of the
Company that covers any of the Registrable Securities pursuant to the
provisions of this Agreement, including the Prospectus, amendments and
supplements to such registration statement, including post-effective
amendments, all exhibits, and all material incorporated by reference or
deemed to be incorporated by reference in such registration statement.
Rule 144: Rule 144 under the Securities Act, as such Rule may
be amended from time to time, or any similar rule or regulation hereafter
adopted by the SEC.
SEC: The Securities and Exchange Commission.
Securities Act: The Securities Act of 1933, as amended, and
the rules and regulations promulgated thereunder.
Shareholder: Each of the shareholders party hereto and any
party who shall hereafter acquire from a Shareholder and hold Registrable
Securities.
Shares: Any shares of capital stock of the Company owned by
any Shareholder, whether owned on the date hereof or hereafter acquired,
including (without limitation) any shares issued upon exercise of the
Warrants or the GE Warrant.
Special Counsel: Any special counsel to the Shareholders, the
fees and expenses of which the Shareholders of Registrable Securities will
be reimbursed pursuant to Section 7(b) hereof.
Underwritten registration or underwritten offering: A
registration in which securities of the Company are to be sold to an
underwriter for reoffering to the public.
Warrants: Any warrants to purchase shares of Common Stock
owned by any Shareholder, whether owned on the date hereof or hereafter
acquired.
Warrant Shares: The shares of Common Stock issued upon
exercise of the Warrants in accordance with the terms thereof.
Page 46 of 65 Pages
2. Shelf Registration
(a) The Company shall, on or prior to July 31, 1995
prepare and file with the SEC a Registration Statement under the Securities
Act for an offering to be made on a continuous basis pursuant to Rule 415
(or any similar rule that may be adopted by the SEC) under the Securities
Act covering all the Registrable Securities (the "Shelf Registration").
(b) The Shelf Registration shall be on Form S-1 or
another appropriate Form (reasonably acceptable to the holders of the
Registrable Securities offered thereby) permitting registration of such
Registrable Securities for resale by such holders in the manner or manners
designated by them (including, without limitation, one or more underwritten
offerings). The Company shall not permit any securities other than the
Registrable Securities to be included in the Shelf Registration.
(c) The Company shall use its best efforts to cause the
Shelf Registration to become effective under the Securities Act on or prior
to 60 days after the filing thereof and shall keep the Shelf Registration
continuously effective for a period of 36 months from the date on which the
Shelf Registration becomes effective under the Securities Act (subject to
extension pursuant to Section 4(a) and Section 5 hereof), or such shorter
period that will terminate when all Registrable Securities covered by the
Shelf Registration have been sold. The Company shall also supplement or
make amendments to the Shelf Registration if required by the rules,
regulations or instructions applicable to the registration form used by the
Company or if required by the Securities Act or if reasonably requested by
holders of a majority of the Registrable Securities covered by the Shelf
Registration or any underwriter of the Registrable Securities.
(d) If any of the Registrable Securities registered
pursuant to the Shelf Registration are to be sold in one or more firm
commitment underwritten offerings, and the managing underwriter advises the
Shareholders of such securities in writing that in its opinion the total
number or dollar amount of Registrable Securities proposed to be sold in
such offering is such as to materially and adversely affect the success of
such offering, then there shall be included in such firm commitment
underwritten offering the number or dollar amount of Registrable Securities
held by the Shareholders that in the opinion of such managing underwriter
can be sold, and such Registrable Securities shall be allocated pro rata on
the basis of the number or dollar amount of securities owned by each such
Shareholder participating in such offering.
3. Piggyback Registration
(a) Right to Piggyback. If at any time the Company
proposes to file a registration statement under the Securities Act with
respect to an offering of any class of equity securities (other than a
registration statement (i) on Form S-4 or S-8 or any successor forms
thereto, or (ii) filed in connection with an offering made solely to
employees of the Company), whether or not for its own account, then the
Company shall give written notice of such proposed filing to the Shar-
eholders of Registrable Securities at least fifteen days before the antici
Page 47 of 65 Pages
pated filing date. Such notice shall offer such Shareholders the opportu-
nity to register such amount of Registrable Securities as each such
Shareholder may request (a "Piggyback Registration"). Subject to Section
3(b) hereof, the Company shall include in each such Piggyback Registration
all Registrable Securities with respect to which the Company has received
written requests for inclusion therein. The Shareholders of Registrable
Securities shall be permitted to withdraw all or part of the Registrable
Securities from a Piggyback Registration at any time prior to the effective
date of such Piggyback Registration.
(b) Priority on Piggyback Registrations. The Company
shall cause the managing underwriter of a proposed underwritten offering to
permit Shareholders of Registrable Securities requested to be included in
the registration for such offering to include all such Registrable Securi-
ties on the same terms and conditions as any similar securities, if any, of
the Company included therein. Notwithstanding the foregoing, if the
managing underwriter of such offering delivers an opinion to the holders of
Registrable Securities that the total number or dollar amount of securities
that such Shareholders, the Company and any other Persons having rights to
participate in such registration ("Other Holders"), propose to include in
such offering is such as to materially and adversely affect the success of
such offering, then:
(i) if such Piggyback Registration is a primary regis-
tration on behalf of the Company, the amount of securities to be offered
for the account of Shareholders of Registrable Securities and Other
Holders, shall be reduced (to zero if necessary) pro rata on the basis of
the number or dollar amounts of securities owned by each such holder
participating in such offering to the extent necessary to reduce the total
amount of securities to be included in such offering to the amount
recommended by such managing underwriter or underwriters; and
(ii) if such Piggyback Registration is an underwritten
secondary registration on behalf of holders of securities of the Company
pursuant to demand registration rights, the Company shall include in such
registration: (x) first, up to the full number or dollar amount of securi-
ties of such Persons exercising "demand" registration rights that in the
opinion of such managing underwriter or underwriters can be sold or
allocated among such holders as they may otherwise so determine, and (y)
second, any securities to be sold for the account of the Company and (z)
third, the number or dollar amount of Registrable Securities and securities
held by Shareholders and Other Holders in excess of the amount of securi-
ties such Persons exercising "demand" registration rights propose to sell
that, in the opinion of such managing underwriter or underwriters, can be
sold (allocated pro rata among the Shareholders of such Registrable Securi-
ties and Other Holders on the basis of the number or dollar amount of
securities owned by such holders).
Page 48 of 65 Pages
4. Hold-Back Agreements
(a) Restrictions on Sale by Shareholders of Registrable
Securities. Each Shareholder agrees not to effect any sale or transfer of
the Registrable Securities issued to it as part of the consideration under
the Note Purchase Agreement until the earlier to occur of (i) September 17,
1995, and (ii) the shareholder vote with respect to the Additional
Issuance. In addition, each Shareholder whose Registrable Securities are
covered by a Registration Statement filed pursuant to Section 2 or 3 here-
of, agrees that, if such Shareholder is requested (pursuant to a timely
written notice) by the managing underwriter in an underwritten offering,
not to effect any public sale or distribution of any of the Company's
equity securities, including a sale pursuant to Rule 144 (except as part of
such underwritten registration), during the 10-day period prior to, and
during the 90-day period beginning on, the closing date of each underwrit-
ten offering made pursuant to such Registration Statement. If a request is
made pursuant to this Section 4(a), the time period during which a Shelf
Registration is required to remain continuously effective pursuant to
Section 2(c) shall be extended by 100 days or such shorter period that will
terminate when all such Registrable Securities not so included have been
sold pursuant to such Registration Statement.
(b) Restrictions on Sale by the Company and Others. The
Company shall not effect any registration of its securities (other than a
registration statement on Form S-8 or any successor form thereto), or
effect any public or private sale or distribution of any of its securities
other than in connection with the Additional Issuance, including a sale
pursuant to Regulation D under the Securities Act, whether on its own
behalf or at the request of any holder or holders of such securities (other
than pursuant to and in accordance with this Agreement), (i) from the date
hereof until 90 days after the effective date of the Shelf Registration,
and (ii) for a 90 day period from the date of each notice to the Company of
a Shareholder's intent to sell Registrable Securities pursuant to an
underwritten public offering, unless the Company shall have first notified
in writing the Shareholders of Registrable Securities covered by such
Registration Statement of its intention to do so, and the Shareholders of a
majority of the Registrable Securities requested to be registered pursuant
to Section 2 shall have consented thereto in writing; provided that the
Company shall not be obligated to refrain from sales or transfers pursuant
to clause (ii) above with respect to more than one such underwritten public
offering during any 12-month period.
The Company shall cause each holder of its equity securities
purchased from the Company at any time on or after the date of this
Agreement (other than in a registered public offering) to agree not to
effect any public sale or distribution of any such securities during such
period, including a sale pursuant to Rule 144.
Page 49 of 65 Pages
5. Registration Procedures
In connection with the Company's registration obligations
pursuant to Sections 2 and 3 hereof, the Company shall effect such
registrations to permit the sale of such Registrable Securities in
accordance with the intended method or methods of disposition thereof, and
pursuant thereto the Company shall as expeditiously as possible:
(a) Prepare and file with the SEC a Registration State-
ment or Registration Statements on any appropriate Form under the
Securities Act available for the sale of the Registrable Securities by the
holders thereof in accordance with the intended method or methods of
distribution thereof, and cause each such Registration Statement to become
effective and remain effective as provided herein; provided, however, that
before filing a Registration Statement or Prospectus or any amendments or
supplements thereto (including documents that would be incorporated or
deemed to be incorporated therein by reference) the Company shall furnish
to the Shareholders of the Registrable Securities covered by such Registra-
tion Statement, the Special Counsel and the managing underwriters, if any,
copies of all such documents proposed to be filed, which documents will be
subject to the review of such Shareholders, the Special Counsel and such
underwriters, and the Company shall not file any such Registration State-
ment or amendment thereto or any Prospectus or any supplement thereto
(including such documents which, upon filing, would or would be
incorporated or deemed to be incorporated by reference therein) to which
the Shareholders of a majority of the Registrable Securities covered by
such Registration Statement, the Special Counsel or the managing underwrit-
er, if any, shall reasonably object to the contents thereof on a timely
basis.
(b) Prepare and file with the SEC such amendments and
post-effective amendments to each Registration Statement as may be
necessary to keep such Registration Statement continuously effective for
the applicable period specified in Section 2; cause the related Prospectus
to be supplemented by any required Prospectus supplement, and as so
supplemented to be filed pursuant to Rule 424 (or any similar provisions
then in force) under the Securities Act; and comply with the provisions of
the Securities Act with respect to the disposition of all securities
covered by such Registration Statement during the applicable period in
accordance with the intended methods of disposition by the sellers thereof
set forth in such Registration Statement as so amended or to such Prospec-
tus as so supplemented.
(c) Notify the selling Shareholders of Registrable
Securities, the Special Counsel and the managing underwriters, if any,
promptly, and (if requested by any such Person) confirm such notice in
writing, (i) when a Prospectus or any Prospectus supplement or post-
effective amendment has been filed, and, with respect to a Registration
Statement or any post-effective amendment, when the same has become
effective, (ii) of any request by the SEC or any other Federal or state
governmental authority for amendments or supplements to a Registration
Statement or related Prospectus or for additional information, (iii) of the
Page 50 of 65 Pages
issuance by the SEC or any other Federal or state governmental authority of
any stop order suspending the effectiveness of a Registration Statement or
the initiation of any proceedings for that purpose, (iv) if at any time the
representations and warranties of the Company contained in any agreement
contemplated by Section 5(m) below (including any underwriting agreement)
below cease to be true and correct, (v) of the receipt by the Company of
any notification with respect to the suspension of the qualification or
exemption from qualification of any of the Registrable Securities for sale
in any jurisdiction or the initiation or threatening of any proceeding for
such purpose, (vi) of the happening of any event which makes any statement
made in such Registration Statement or related Prospectus or any document
incorporated or deemed to be incorporated therein by reference untrue or
which requires the making of any changes in a Registration Statement,
Prospectus or documents so that, in the case of the Registration Statement,
it will not contain any untrue statement of a material fact or omit to
state any material fact required to be stated therein or necessary to make
the statements therein not misleading, and that in the case of the
Prospectus, it will not contain any untrue statement of a material fact
required to be stated therein is necessary to make the statements therein,
in light of the circumstances under which they were made, not misleading,
and (vii) of the Company's reasonable determination that a post-effective
amendment to a Registration Statement would be appropriate.
(d) Use every reasonable effort to obtain the withdrawal
of any order suspending the effectiveness of a Registration Statement, or
the lifting of any suspension of the qualification (or exemption from
qualification) of any of the Registrable Securities for sale in any juris-
diction, at the earliest possible moment.
(e) If requested by the managing underwriters, if any,
or any Shareholder of Registrable Securities being sold, (i) promptly
incorporate in a Prospectus supplement or post-effective amendment such
information as the managing underwriters, if any, and such Shareholder
agree should be included therein as may be required by applicable law, (ii)
make all required filings of such Prospectus supplement or such post-
effective amendment as soon as the Company has received notification of the
matters to be incorporated in such Prospectus supplement or post-effective
amendment, and (iii) supplement or make amendments to any Registration
Statement.
(f) Furnish to each selling Shareholder of Registrable
Securities, the Special Counsel and each managing underwriter, if any,
without charge, (i) at least one signed copy of the Registration Statement
or Statements and any post-effective amendment thereto, including financial
statements and schedules, all documents incorporated therein by reference
or deemed incorporated therein by reference and all exhibits (including
those previously furnished or incorporated by reference) at the earliest
practicable time under the circumstances before the filing of such
documents with the SEC and (ii) as many copies of the Prospectus or Pro-
spectuses relating to such Registrable Securities (including each prelimi-
nary prospectus) and any amendment or supplement thereto as such Persons
Page 51 of 65 Pages
may request. The Company hereby consents to the use of such Prospectus or
each amendment or supplement thereto by each of the selling Shareholders of
Registrable Securities and the underwriters, if any, in connection with the
offering and sale of the Registrable Securities covered by such Prospectus
or any amendment or supplement thereto.
(g) Prior to any public offering of Registrable Securi-
ties, to register or qualify or cooperate with the selling Shareholders of
Registrable Securities, the underwriters, if any, and their respective
counsel in connection with the registration or qualification (or exemption
from such registration or qualification) of such Registrable Securities for
offer and sale under the securities or Blue Sky laws of such jurisdictions
as any seller or underwriter reasonably requests in writing; keep each such
registration or qualification (or exemption therefrom) effective during the
period such Registration Statement is required to be kept effective and do
any and all other acts or things necessary or advisable to enable the
disposition in such jurisdictions of the Registrable Securities covered by
the applicable Registration Statement; provided, however, that the Company
will not be required to (i) qualify generally to do business in any
jurisdiction where it is not then so qualified or (ii) take any action that
would subject it to taxation or general service of process in any such
jurisdiction where it is not then so subject.
(h) Cooperate with the selling Shareholders of Regis-
trable Securities and the managing underwriters, if any, to facilitate the
timely preparation and delivery of certificates representing Registrable
Securities to be sold, which certificates shall not bear any restrictive
legends; and enable such Registrable Securities to be registered in such
names as the managing underwriters, if any, request at least two business
days prior to any sale of Registrable Securities to the underwriters.
(i) Cause the Registrable Securities covered by the
applicable Registration Statement to be registered with or approved by such
other governmental agencies or authorities as may be necessary to enable
the sellers thereof or the underwriters, if any, to consummate the
disposition of such Registrable Securities.
(j) Upon the occurrence of any event contemplated by
paragraph 5(c)(vi) or 5(c)(vii) above, prepare a supplement or post-
effective amendment to each Registration Statement or a supplement to the
related Prospectus or any document incorporated therein by reference or
file any other required document so that, as thereafter delivered to the
purchasers of the Registrable Securities being sold thereunder, such
Prospectus will not contain an untrue statement of a material fact or omit
to state a material fact required to be stated therein or necessary to make
the statements therein, in light of the circumstances under which they were
made, not misleading.
Page 52 of 65 Pages
(k) Cause all Registrable Securities covered by such
Registration Statement to be (i) listed on each securities exchange, if
any, on which similar securities issued by the Company are then listed, or
(ii) authorized to be quoted on the National Association of Securities
Dealers Automated Quotation System ("NASDAQ") or the National Market System
of NASDAQ if the securities so qualify.
(l) Enter into such agreements (including an underwrit-
ing agreement in form, scope and substance as is customary in underwritten
offerings) and take all such other actions in connection therewith
(including those requested by the managing underwriters, if any, or the
Shareholders of a majority of the Registrable Securities being sold) in
order to expedite or facilitate the disposition of such Registrable
Securities and in such connection, whether or not an underwriting agreement
is entered into and whether or not the registration is an underwritten
registration, (i) make such representations and warranties to the
Shareholders of such Registrable Securities and the underwriters, if any,
with respect to the business of the Company and its subsidiaries, the
Registration Statement, Prospectus and documents incorporated by reference
or deemed incorporated by reference, if any, in each case, in form,
substance and scope as are customarily made by issuers to underwriters in
underwritten offerings and confirm the same if and when requested; (ii)
obtain opinions of counsel to the Company and updates thereof (which
counsel and opinions (in form, scope and substance) shall be reasonably
satisfactory to the managing underwriters, if any, and the Shareholders of
a majority of the Registrable Securities being sold) addressed to each
selling Shareholder of Registrable Securities and each of the underwriters,
if any, covering the matters customarily covered in opinions requested in
underwritten offerings and such other matters as may be reasonably request-
ed by such Shareholders and underwriters, including without limitation the
matters referred to in paragraph 5(m)(i) above; (iii) obtain "cold comfort"
letters and updates thereof from the independent certified public ac-
countants of the Company (and, if necessary, any other certified public
accountants of any subsidiary of the Company or of any business acquired by
the Company for which financial statements and financial data is, or is
required to be, included in the Registration Statement), addressed to each
selling Shareholder of Registrable Securities and each of the underwriters,
if any, such letters to be in customary form and covering matters of the
type customarily covered in "cold comfort" letters in connection with
underwritten offerings; and (iv) deliver such documents and certificates as
may be requested by the Shareholders of a majority of the Registrable
Securities being sold, the Special Counsel and the managing underwriters,
if any, to evidence the continued validity of the representations and
warranties of the Company and its subsidiaries made pursuant to clause (i)
above and to evidence compliance with any customary conditions contained in
the underwriting agreement or other agreement entered into by the Company.
Page 53 of 65 Pages
(m) Make available for inspection by a representative of
the Shareholders of Registrable Securities being sold, any underwriter
participating in any disposition of Registrable Securities, if any, and any
attorney or accountant retained by such selling Shareholders or underwrit-
er, all financial and other records, pertinent corporate documents and
properties of the Company and its subsidiaries, and cause the officers,
directors and employees of the Company and its subsidiaries to supply all
information reasonably requested by any such representative, underwriter,
attorney or accountant in connection with such Registration Statement;
provided, however, that any records, information or documents that are
designated by the Company in writing as confidential at the time of
delivery of such records, information or documents shall be kept confiden-
tial by such Persons unless (i) such records, information or documents are
in the public domain or otherwise publicly available, (ii) disclosure of
such records, information or documents is required by court or administra-
tive order or is necessary to respond to inquiries of regulatory
authorities or (iii) disclosure of such records, information or documents,
in the opinion of counsel to such Person, is otherwise required by law
(including, without limitation, pursuant to the requirements of the
Securities Act).
(n) File any reports required to be filed by it under
the Securities Act and the Securities Exchange Act of 1934, as amended, and
that it will take such further action as any Shareholder may reasonably
request, all to the extent required from time to time to enable Share-
holders to sell Registrable Securities without registration under the
Securities Act within the limitation of the exemptions provided by (a) Rule
144 or Rule 144A under the Securities Act, as such Rules may be amended
from time to time, or (b) any similar rule or regulation hereafter adopted
by the SEC. Upon the request of any Shareholder, the Company will deliver
to such Shareholder a written statement as to whether it has complied with
such requirements.
(o) Use its best efforts to comply with all applicable
rules and regulations of the SEC, and make available to its security
holders, as soon as reasonably practicable, an earnings statement covering
a period of 12 months, beginning within three months after the effective
date of the registration statement, which earnings statement shall satisfy
the provisions of Section 11(a) of the Securities Act.
(p) Prior to the effective date of the Shelf
Registration or the first Piggy-Back Registration, whichever shall occur
first, (i) provide the transfer agent with printed certificates for the
Registrable Securities in a form eligible for deposit with The Depository
Trust Company ("DTC"), and (ii) provide a CUSIP number for the Registrable
Securities.
Page 54 of 65 Pages
(q) In connection with an underwritten offering,
participate, to the extent reasonably requested by the managing underwriter
for the offering or the Holders, in customary efforts to sell the
securities under the offering, including, without limitation, participating
in "road shows"; provided that the Company shall not be obligated so to
participate in more than one such offering in any 12-month period.
The Company may require each seller of Registrable Securities
as to which any registration is being effected to furnish to the Company
such information regarding the distribution of such Registrable Securities
as the Company may, from time to time, reasonably request in writing.
Each Shareholder of Registrable Securities agrees by acquisi-
tion of such Registrable Securities that, upon receipt of any notice from
the Company of the happening of any event of the kind described in Section
5(c)(ii), 5(c)(iii), 5(c)(v), 5(c)(vi) or 5(c)(vii) hereof, such
Shareholder will forthwith discontinue disposition of such Registrable
Securities covered by such Registration Statement or Prospectus until such
Shareholder's receipt of the copies of the supplemented or amended
Prospectus contemplated by Section 5(j) hereof, or until it is advised in
writing (the "Advice") by the Company that the use of the applicable
Prospectus may be resumed, and has received copies of any additional or
supplemental filings that are incorporated or deemed to be incorporated by
reference in such Prospectus. In the event the Company shall give any such
notice, the time period mentioned in Section 2(c) hereof shall be extended
by the number of days during the time period from and including the date of
the giving of such notice to and including the date when each seller of
Registrable Securities covered by such Registration Statement shall have
received (x) the copies of the supplemented or amended Prospectus contem-
plated by Section 5(j) hereof or (y) the Advice.
6. Registration Expenses
(a) All fees and expenses incident to the performance of
or compliance with this Agreement by the Company shall be borne by the
Company whether or not any of the Registration Statements become effective.
Such fees and expenses shall include, without limitation, (i) all regis-
tration and filing fees (including, without limitation, fees and expenses -
(x) with respect to filings required to be made with the National
Association of Securities Dealers, Inc. and (y) of compliance with
securities or "blue sky" laws (including without limitation fees and
disbursements of counsel for the underwriters or selling holders in connec-
tion with "blue sky" qualifications of the Registrable Securities and
determination of the eligibility of the Registrable Securities for
investment under the laws of such jurisdictions as the managing under-
writers, if any, or Shareholders of a majority of the Registrable
Securities being sold may designate)), (ii) printing expenses (including,
without limitation, expenses of printing certificates for Registrable
Securities in a form eligible for deposit with DTC and of printing
prospectuses if the printing of prospectuses is requested by the
Shareholders of a majority of the Registrable Securities included in any
Registration Statement), (iii) messenger, telephone and delivery expens
Page 55 of 65 Pages
es, (iv) fees and disbursements of counsel for the Company, (v) fees and
disbursements of all independent certified public accountants referred to
in Section (5)(m)(iii) hereof (including the expenses of any annual or
special audit and "cold comfort" letters required by or incident to such
performance), and (vi) fees and expenses of all other Persons retained by
the Company.
(b) In connection with any Shelf Registration or Piggy-
back Registration hereunder, the Company shall reimburse the Shareholders
of the Registrable Securities being registered in such registration for the
reasonable fees and disbursements of not more than one counsel (or more
than one counsel if a conflict exists among such selling Shareholders in
the exercise of the reasonable judgment of counsel for the selling
Shareholders and counsel for the Company), together with appropriate local
counsel, chosen by the Shareholders of a majority of the Registrable
Securities being registered.
7. Indemnification
(a) Indemnification by the Company. The Company shall,
without limitation as to time, indemnify and hold harmless, to the fullest
extent permitted by law, each Shareholder of Registrable Securities, the
partners, officers, directors, agents and employees of each of them, each
Person who controls such Shareholder (within the meaning of Section 15 of
the Securities Act or Section 20 of the Exchange Act) and the partners,
officers, directors, agents and employees of each such controlling person,
from and against all losses, claims, damages, liabilities, costs
(including, without limitation, the costs of preparation and attorneys'
fees) and expenses (collectively, "Losses") to be reimbursed promptly, as
incurred, arising out of or based upon any untrue or alleged untrue state-
ment of a material fact contained in any Registration Statement, Prospectus
or form of Prospectus or in any amendment or supplement thereto or in any
preliminary prospectus, or arising out of or based upon any omission or
alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, except
insofar as the same are based solely upon information furnished in writing
to the Company by such Shareholder expressly for use therein. The Company
shall also indemnify each underwriter, selling broker, dealer manager and
similar securities industry professional participating in the distribution,
and each of their officers, directors, agents and employees and each Person
who controls such Persons (within the meaning of Section 15 of the
Securities Act or Section 20 of the Exchange Act) to the same extent as
provided above with respect to the indemnification of the holders of Regis-
trable Securities.
(b) Indemnification by Shareholder of Registrable Secu-
rities. In connection with any Registration Statement in which a
Shareholder of Registrable Securities is participating, such Shareholder of
Registrable Securities shall furnish to the Company in writing such infor-
mation as the Company reasonably requests for use in connection with any
Registration Statement or Prospectus and agrees to indemnify, to the
fullest extent permitted by law, the Company, its directors and officers,
Page 56 of 65 Pages
agents and employees, each Person who controls the Company (within the
meaning of Section 15 of the Securities Act and Section 20 of the Exchange
Act), and the directors, officers, agents or employees of such controlling
persons, from and against all Losses arising out of or based upon any
untrue statement of a material fact contained in any Registration
Statement, Prospectus or preliminary prospectus or arising out of or based
upon any omission of a material fact required to be stated therein or
necessary to make the statements therein not misleading, to the extent, but
only to the extent, that such untrue statement or omission is contained in
and in conformity with any information so furnished in writing by such
Shareholder to the Company expressly for use in such Registration Statement
or Prospectus and that such information was solely relied upon by the
Company in preparation of such Registration Statement, Prospectus or pre-
liminary prospectus. In no event shall the liability of any selling
Shareholder of Registrable Securities hereunder be greater in amount than
the dollar amount of the proceeds (net of payment of all expenses) received
by such Shareholder upon the sale of the Registrable Securities giving rise
to such indemnification obligation.
(c) Conduct of Indemnification Proceedings. If any
Person shall be entitled to indemnity hereunder (an "indemnified party"),
such indemnified party shall give prompt notice to the party from which
such indemnity is sought (the "indemnifying party") of any claim or of the
commencement of any Proceeding with respect to which such indemnified party
seeks indemnification or contribution pursuant hereto; provided, however,
that the failure to so notify the indemnifying party shall not relieve the
indemnifying party from any obligation or liability except to the extent
that the indemnifying party has been prejudiced materially by such failure.
All such fees and expenses (including any fees and expenses incurred in
connection with investigating or preparing to defend such action or
proceeding) shall be paid to the indemnified party, as incurred, within
five days of written notice thereof to the indemnifying party (regardless
of whether it is ultimately determined that an indemnified party is not
entitled to indemnification hereunder). The indemnifying party shall not
consent to entry of any judgment or enter into any settlement or otherwise
seek to terminate any Proceeding in which any indemnified party is or could
be a party and as to which indemnification or contribution could be sought
by such indemnified party under this Section 7, unless such judgment,
settlement or other termination includes as an unconditional term thereof
the giving by the claimant or plaintiff to such indemnified party of a
release, in form and substance satisfactory to the indemnified party, from
all liability in respect of such claim or litigation for which such
indemnified party would be entitled to indemnification hereunder.
(d) Contribution. If the indemnification provided for
in this Section 7 is unavailable to an indemnified party under Section 7(a)
or 7(b) hereof in respect of any Losses or is insufficient to hold such
indemnified party harmless, then each applicable indemnifying party, in
lieu of indemnifying such indemnified party, shall, jointly and severally,
contribute to the amount paid or payable by such indemnified party as a
result of such Losses, in such proportion as is appropriate to reflect the
relative fault of the indemnifying party or indemnifying parties, on the
Page 57 of 65 Pages
one hand, and such indemnified party, on the other hand, in connection with
the actions, statements or omissions that resulted in such Losses as well
as any other relevant equitable considerations. The relative fault of such
indemnifying party or indemnifying parties, on the one hand, and such
indemnified party, on the other hand, shall be determined by reference to,
among other things, whether any action in question, including any untrue or
alleged untrue statement of a material fact or omission or alleged omission
of a material fact, has been taken or made by, or relates to information
supplied by, such indemnifying party or indemnified party, and the parties'
relative intent, knowledge, access to information and opportunity to
correct or prevent such action, statement or omission. The amount paid or
payable by a party as a result of any Losses shall be deemed to include any
legal or other fees or expenses incurred by such party in connection with
any Proceeding.
The parties hereto agree that it would not be just and
equitable if contribution pursuant to this Section 7(d) were determined by
pro rata allocation or by any other method of allocation that does not take
into account the equitable considerations referred to in the immediately
preceding paragraph. Notwithstanding the provision of this Section 7(d),
an indemnifying party that is a selling Shareholder of Registrable
Securities shall not be required to contribute any amount in excess of the
amount by which the total price at which the Registrable Securities sold by
such indemnifying party and distributed to the public were offered to the
public exceeds the amount of any damages which such indemnifying party has
otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities
Act) shall be entitled to contribution from any Person who was not guilty
of such fraudulent misrepresentation.
The indemnity, contribution and expense reimbursement
obligations of the Company hereunder shall be in addition to any liability
the Company may otherwise have hereunder or otherwise. The provisions of
this Section 7 shall survive so long as Registrable Securities remain
outstanding, notwithstanding any transfer of the Registrable Securities by
any Shareholder or any termination of this Agreement.
8. Underwritten Registrations
If any of the Registrable Securities covered by a Shelf
Registration are to be sold in an underwritten offering, the investment
banker or investment bankers and manager or managers that will manage the
offering will be selected by the Shareholders of a majority of such Regis-
trable Securities included in such offering. If any Piggyback Registration
is an underwritten offering, the Company shall have the right to select the
investment banker or investment bankers and managers to administer the
offering; provided, however, that such investment bank or manager shall be
reasonably satisfactory to the Shareholders of a majority of the
Registrable Securities included in such offering.
Page 58 of 65 Pages
9. Miscellaneous
(a) Remedies. In the event of a breach by the Company
of its obligations under this Agreement, each Shareholder of Registrable
Securities, in addition to being entitled to exercise all rights granted by
law, including recovery of damages, will be entitled to specific perfor-
mance of its rights under this Agreement. The Company agrees that monetary
damages would not be adequate compensation for any loss incurred by reason
of a breach by it of any of the provisions of this Agreement and hereby
further agrees that, in the event of any action for specific performance in
respect of such breach, it shall waive the defense that a remedy at law
would be adequate.
(b) No Inconsistent Agreements. The Company has not, as
of the date hereof, and shall not, on or after the date of this Agreement,
enter into any agreement with respect to its securities which is incon-
sistent with the rights granted to the Shareholders of Registrable
Securities in this Agreement or otherwise conflicts with the provisions
hereof. The Company has not entered into any agreement with respect to its
securities granting any registration rights to any Person other than this
Agreement.
(c) Amendments and Waivers. This Agreement may be
amended, modified or supplemented, and waivers or consents to departures
from the provisions hereof may be given, provided the same are in writing
and signed by the Company and each of the Shareholders of Registrable
Securities. Notwithstanding the foregoing, a waiver or consent to depart
from the provisions hereof with respect to a matter that relates exclu-
sively to the rights of Shareholders of Registrable Securities whose
securities are being sold pursuant to a Registration Statement and that
does not directly or indirectly affect the rights of other Shareholders of
Registrable Securities may, in lieu of complying with the first sentence of
this Section 9(c), be given by all Shareholders of the Registrable Securi-
ties being sold; provided, however, that the provisions of this sentence
may not be amended, modified, or supplemented except in accordance with the
provisions of the immediately preceding sentence.
(d) Notices. All notices and other communications
provided for or permitted hereunder shall be made in writing and shall be
deemed given (i) when made, if made by hand delivery, (ii) upon
confirmation, if made by telecopier or (iii) one business day after being
deposited with a reputable next-day courier, postage prepaid, to the
parties as follows:
(x) if to a Shareholder of Registrable Securities, at
the most current address given by such Shareholder to the Company in
accordance with the provisions of this Section 9(d), which address ini-
tially is the address set forth on its respective signature page attached
hereto; and
Page 59 of 65 Pages
(y) if to the Company, initially at Four Embarcadero
Center, Suite 3620, San Francisco, California 94111-4115, Fax: (415) 788-
5660, Attention: Chief Executive Officer, and thereafter at such other ad-
dress, notice of which is given in accordance with the provisions of this
Section 9(d);
or to such other address as any party may have furnished to the other
parties in writing in accordance herewith.
(e) Owner of Registrable Securities. The Company will
maintain, or will cause its registrar and transfer agent to maintain, a
stock book with respect to the Common Stock and the Warrants, in which all
transfers of Registrable Securities of which the Company has received
notice will be recorded. The Company may deem and treat the person in
whose name Registrable Securities are registered in the stock book of the
Company as the owner thereof for all purposes, including without
limitation, the giving of notices under this Agreement.
(f) Successors and Assigns. This Agreement shall be
binding upon and shall inure to the benefit of any and all successors and
assigns of each of the parties and shall inure to the benefit of each
Shareholder of any Registrable Securities. The Company may not assign its
rights or obligations hereunder without the prior written consent of each
Shareholder of any Registrable Securities. Notwithstanding the foregoing,
no transferee shall have any of the rights granted under this Agreement (i)
until such transferee shall acknowledge its rights and obligations
hereunder by a signed written statement of such transferee's acceptance of
such rights and obligations or (ii) if the transferor notifies the Company
in writing on or prior to such transfer that the transferee shall not have
such rights.
(g) Counterparts. This Agreement may be executed in any
number of counterparts and by the parties hereto in separate counterparts,
each of which when so executed shall be deemed to be an original and all of
which taken together shall constitute one and the same agreement.
(h) Headings. The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise affect the
meaning hereof.
(i) Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF CALIFORNIA, AS
APPLIED TO CONTRACTS MADE AND PERFORMED WITHIN THE STATE OF CALIFORNIA,
WITHOUT REGARD TO PRINCIPLES OF CONFLICT OF LAWS.
(j) Severability. If any term, provision, covenant or
restriction of this Agreement is held by a court of competent jurisdiction
to be invalid, void or unenforceable, the remainder of the terms,
provisions, covenants and restrictions set forth herein shall remain in
full force and effect and shall in no way be affected, impaired or invali-
dated, and the parties hereto shall use their best efforts to find and
employ an alternative means to achieve the same or substantially the same
Page 60 of 65 Pages
result as that contemplated by such term, provision, covenant or re-
striction. It is hereby stipulated and declared to be the intention of the
parties that they would have executed the remaining terms, provisions,
covenants and restrictions without including any of such which may be
hereafter declared invalid, void or unenforceable.
(k) Attorneys' Fees. In any action or proceeding
brought to enforce any provision of this Agreement, or where any provision
hereof is validly asserted as a defense, the prevailing party, as deter-
mined by the court, shall be entitled to recover reasonable attorneys' fees
in addition to any other available remedy.
Page 61 of 65 Pages
IN WITNESS WHEREOF, each of the parties hereto has executed
this Agreement as of the date first above written.
AMERICAN SHARED HOSPITAL SERVICES
By:------------------------------
Name:
Title:
AIF II, L.P.
By: Apollo Advisors, L.P.
Managing General Partner
By: Apollo Capital Management, Inc.
General Partner
By:------------------------------
Its:------------------------------
1999 Avenue of the Stars, Suite 1900
Los Angeles, California 90067
Attn: Pandora Pang
Fax: (310) 201-4198
Page 62 of 65 Pages
ANCHOR NATIONAL LIFE INSURANCE COMPANY
By:------------------------------
Name:
Title:
Address for Notice:
1999 Avenue of the Stars, 38th Floor
Los Angeles, California 90067
Attn:
Fax: (310) 772-6150
GENERAL ELECTRIC COMPANY
acting through GE MEDICAL SYSTEMS
By:------------------------------
Name:
Title:
Address for Notice:
20825 Swensen Drive, Suite 100
Waukesha, Wisconsin 53186
Attn: Investment Manager
Fax: (414) 798-4528
Page 63 of 65 Pages
GRACE BROTHERS, LTD.
By:------------------------------
Name:
Title:
Address for Notice:
1000 West Diversey Street, Suite 233
Chicago, Illinois 60614
Attn: Bradford Whitmore
Fax: (312) 868-0509
LION ADVISORS, L.P.
on behalf of an account under
management
By: Lion Capital Management, Inc.
General Partner
By:------------------------------
Its:-----------------------------
Address for Notice:
1999 Avenue of the Stars, Suite 1900
Los Angeles, California 90067
Attn: Pandora Pang
Fax: (310) 201-4198
Page 64 of 65 Pages
SUN LIFE INSURANCE COMPANY OF AMERICA
By:-------------------------------
Name:
Title:
Address for Notice:
1999 Avenue of the Stars, 38th Floor
Los Angeles, California 90067
Attn:
Fax: (310) 772-6150
SUNAMERICA INC.
By:------------------------------
Name:
Title:
Address for Notice:
1999 Avenue of the Stars, 38th Floor
Los Angeles, California 90067
Attn:
Fax: (310) 772-6150
Page 65 of 65 Pages
UPCHURCH LIVING TRUST U/A/D 12/14/90
By:------------------------------
Name:
Title:
Address for Notice:
James B. Upchurch
C/O Libra Investments, Inc.
11766 Wilshire Boulevard, Suite 870
Los Angeles, California 90025
Fax: (310) 312-5666
