<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON OCTOBER 16, 1996
REGISTRATION NO. 333-12879
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
AMENDMENT NO. 1
TO
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------------
AMERICAN SHARED HOSPITAL SERVICES
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
<TABLE>
<S> <C>
CALIFORNIA 94-2918118
(STATE OR OTHER JURISDICTION (I.R.S. EMPLOYER
OF INCORPORATION OR ORGANIZATION) IDENTIFICATION NUMBER)
</TABLE>
FOUR EMBARCADERO CENTER, SUITE 3620
SAN FRANCISCO, CALIFORNIA 94111-4155
(415) 788-5300
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING
AREA CODE, OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
------------------------
ERNEST A. BATES, M.D.
CHAIRMAN OF THE BOARD AND CHIEF EXECUTIVE OFFICER
AMERICAN SHARED HOSPITAL SERVICES
FOUR EMBARCADERO CENTER, SUITE 3620
SAN FRANCISCO, CALIFORNIA 94111-4155
(415) 788-5300
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING
AREA CODE, OF AGENT FOR SERVICE)
------------------------
WITH A COPY TO:
DANIEL G. KELLY, JR.
SIDLEY & AUSTIN
875 THIRD AVENUE
NEW YORK, NEW YORK 10022
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: From time
to time after the effective date of this Registration Statement.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. / /
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. /X/
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. / /
If this Form is a post-effective amendment filed pursuant to Section 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. / /
If delivery of this prospectus is expected to be made pursuant to Rule 434,
please check the following box. / /
------------------------
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF
THE SECURITIES ACT OF 1933, AS AMENDED, OR UNTIL THIS REGISTRATION STATEMENT
SHALL BECOME EFFECTIVE ON SUCH DATE AS THE SECURITIES AND EXCHANGE COMMISSION,
ACTING PURSUANT TO SAID SECTION 8(a), MAY DETERMINE.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE> 2
AMERICAN SHARED HOSPITAL SERVICES
------------------------
CROSS REFERENCE SHEET
PURSUANT TO ITEM 501(b) OF REGULATION S-K
<TABLE>
<CAPTION>
LOCATION IN REGISTRATION STATEMENT OR
FORM S-3 ITEM NUMBER AND CAPTION PROSPECTUS
- ------------------------------------------------- ------------------------------------------
<S> <C> <C>
1. Forepart of Registration Statement and
Outside Front Cover Page of Prospectus.... Facing Page; Cross-Reference Sheet;
Outside Front Cover Page of Prospectus
Inside Front Cover Page and Outside Back
2. Inside Front and Outside Back Cover Pages
of Prospectus............................. Cover Page of Prospectus; Available
Information
3. Summary Information, Risk Factors and
Ratio of Earnings to Fixed Charges........ Risk Factors
4. Use of Proceeds........................... Use of Proceeds
5. Determination of Offering Price........... Determination of Offering Price
6. Dilution.................................. *
7. Selling Security Holders.................. Selling Securityholders
8. Plan of Distribution...................... Plan of Distribution
9. Description of Securities to be
Registered................................ Description of Common Shares
10. Interests of Named Experts and Counsel.... Legal Matters; Experts
11. Material Changes.......................... The Company; Financial Restructuring;
Capitalization
12. Incorporation of Certain Information by
Reference................................. Available Information
13. Disclosure of Commission Position on
Indemnification for Securities Act
Liabilities............................... *
</TABLE>
- ------------------
* Not applicable.
<PAGE> 3
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR
MAY OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT
BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR
THE SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE
SECURITIES IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE
UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS
OF ANY SUCH STATE.
SUBJECT TO COMPLETION, OCTOBER 16, 1996
PROSPECTUS
2,679,047 COMMON SHARES
AMERICAN SHARED HOSPITAL SERVICES
The shares of common stock, no par value ("Common Shares"), of American
Shared Hospital Services, a California corporation ("ASHS" and together with its
subsidiaries, the "Company"), covered by this Prospectus may be sold from time
to time by the securityholders specified in this Prospectus (the "Selling
Securityholders"). See "Selling Securityholders."
The Common Shares are listed on the American Stock Exchange ("the AMEX")
under the trading symbol "AMS." The Common Shares are also listed on The Pacific
Stock Exchange ("The PSE"). Each such exchange has commenced a review procedure
to determine whether the Common Shares will remain listed. See "Risk
Factors -- Possible Delisting of Common Shares and Loss of Active Trading
Market." On September 23, 1996, the last reported sale price of the Common
Shares on the AMEX was $1.375 per share.
The Company will not receive any of the proceeds from the sale of the
Common Shares being offered by the Selling Securityholders. The Selling
Securityholders may, from time to time, sell the Common Shares at market prices
prevailing on the AMEX or The PSE, respectively, at the time of sale or sell the
Common Shares under certain other terms. See "Plan of Distribution."
------------------------
THE SECURITIES ARE SPECULATIVE AND INVOLVE A HIGH DEGREE OF RISK. SEE "RISK
FACTORS" FOR A DISCUSSION OF CERTAIN FACTORS WHICH SHOULD BE CONSIDERED IN
CONNECTION WITH AN INVESTMENT IN THE SECURITIES OFFERED HEREBY.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR
ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
THE DATE OF THE PROSPECTUS IS OCTOBER , 1996
<PAGE> 4
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance
therewith files periodic reports, proxy statements and other information with
the Securities and Exchange Commission (the "Commission"). Such reports, proxy
statements and other information filed by the Company with the Commission can be
inspected and copied at the public reference facilities maintained by the
Commission at Room 1024, Judiciary Plaza, 450 Fifth Street, N.W., Washington,
D.C. 20549, and at the Commission's Regional Offices at 7 World Trade Center,
New York, New York 10007 and Northwestern Atrium Center, 500 Madison Street,
Suite 1400, Chicago, Illinois 60661-2511. Copies of such material can be
obtained upon written request addressed to the Commission, Public Reference
Section, Room 1024, Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C.
20549, and its public reference facilities in New York, New York and Chicago,
Illinois, at prescribed rates. The Commission maintains a site on the World Wide
Web at http://www.sec.gov that contains reports, proxy and information
statements and other information regarding registrants that file electronically
with the Commission. The Company's Common Shares are listed on the American
Stock Exchange and The Pacific Stock Exchange, and such reports, proxy
statements, and other information concerning the Company can also be inspected
at the offices of the American Stock Exchange, 86 Trinity Place, New York, New
York 10006 and at the offices of The Pacific Stock Exchange, 301 Pine Street,
San Francisco, California 94104. Statements contained in this Prospectus as to
the contents of any agreement or other document are not necessarily complete,
and in each instance reference is made to the copy of such agreement or document
filed as an exhibit to the Registration Statement, each such statement being
qualified in all respects by such reference.
Additional information regarding the Company and the Common Shares offered
hereby is contained in the Registration Statement on Form S-3 and the exhibits
(the "Registration Statement") filed with the Commission under the Securities
Act of 1933, as amended (the "Securities Act"). This Prospectus does not contain
all the information set forth in the Registration Statement, certain parts of
which are omitted in accordance with the rules and regulations of the
Commission. For further information, reference is made to the Registration
Statement which may be inspected without charge at, and copies thereof may be
obtained at prescribed rates from, the Commission at Room 1024, 450 Fifth
Street, N.W., Judiciary Plaza, Washington, D.C. 20549.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed by the Company with the Commission pursuant
to the Exchange Act are incorporated herein by reference:
(1) The Company's Annual Report on Form 10-K for the fiscal year ended
December 31, 1995 (the "1995 10-K");
(2) The Company's Quarterly Reports on Form 10-Q for the fiscal
quarters ended March 31, 1996 and June 30, 1996; and
(3) The description of the Company's Common Shares contained in the
Company's Registration Statement on Form 8-A (Registration No. 1-8789),
which was declared effective by the Commission on October 23, 1984.
All documents filed by the Company pursuant to Sections 13(a), 14 or 15(d)
of the Exchange Act subsequent to the date of this Prospectus shall be deemed to
be incorporated by reference in this Prospectus and to be part hereof from the
date of filing of such documents.
Any statement contained herein or in a document incorporated or deemed to
be incorporated herein by reference shall be deemed to be modified or superseded
for purposes of this Prospectus to the extent that a statement contained herein
or in any subsequently filed document which is deemed to be incorporated by
reference herein modifies or supersedes such prior statement. Any such statement
so modified or superseded shall not be deemed, except as so modified or
superseded, to constitute a part of this Prospectus.
2
<PAGE> 5
The Company will provide without charge to each person, including any
beneficial owner, to whom a copy of this Prospectus is delivered, upon oral or
written request, a copy of any or all of the documents incorporated herein by
reference (other than exhibits to such documents, unless such exhibits are
specifically incorporated by reference in such documents). Written or telephone
inquiries should be directed to American Shared Hospital Services, Four
Embarcadero Center, Suite 3620, San Francisco, California 94111, Attention:
Richard Magary (telephone: (415) 788-5300).
3
<PAGE> 6
RISK FACTORS
The following specific factors should be considered carefully by
prospective investors in evaluating the Company, its business and an investment
in the Common Shares.
DEFAULTS, POTENTIAL BANKRUPTCY AND RESTRUCTURING
As a result of a serious cash shortage during the second half of 1992, the
Company failed to make the required semi-annual interest payments under its
14 3/4% Subordinated Notes due 1996 (the "14 3/4% Notes") and Senior
Subordinated Exchangeable Reset Notes due 1996 (the "16 1/2% Notes" and
collectively with the 14 3/4% Notes, the "Subordinated Notes") that were due
beginning on October 15, 1992. In addition, the Company suspended lease payments
on a significant portion of its equipment leases beginning on December 1, 1992.
The non-payment of interest and the suspension of lease payments caused defaults
under the Company's Subordinated Notes and equipment leases and gave the holders
of such obligations as well as the lender under the Company's senior secured
working capital facility the right to declare all amounts immediately due and
payable and to reclaim substantially all of the Company's diagnostic imaging
equipment and other assets. The Company stated that if any of such creditors or
lessors had exercised their rights, the Company would have been forced to seek a
liquidation under Chapter 7 or a reorganization under Chapter 11 of the United
States Bankruptcy Code.
Following lengthy negotiations, the Company restructured its debt and most
of its lease obligations (the "Restructuring"). The restructuring had the effect
of curing all defaults under the Subordinated Notes and the equipment leases.
The Company nevertheless remains highly leveraged and has substantial fixed
payment obligations. If defaults occur in the future, the Company's creditors
and lessors would have the ability to accelerate the Company's obligations and
seize substantially all of its medical imaging equipment and other assets. There
can be no assurance that the Company will be able to avoid such defaults in the
future.
RECENT LOSSES; FINANCIAL CONDITION OF THE COMPANY
The Company has reported significant operating losses in each of the last
three fiscal years. The net loss of the Company (before extraordinary items) was
$15,644,000, $5,537,000, and $12,459,000 for the years ended December 31, 1993,
1994 and 1995, respectively. The Company had a net capital deficiency of
$11,024,000 at June 30, 1996. The Company reported net income of $7,344,000 and
a corresponding reduction of its net capital deficiency in 1995 due to an
extraordinary gain of $19,803,000 from the early extinguishment of debt at a
discount. Unless the Company is able to increase its revenues and/or increase
its operating margins through a reduction in its cost of operations, it will be
unable to achieve profitability. There can be no assurance that the Company will
be profitable in the future.
HIGH DEBT LEVEL
Even following the Restructuring, in which the Company was able to
repurchase at a significant discount and retire $17,694,000 principal amount of
Subordinated Notes, the Company remains highly leveraged. At August 31, 1996,
the Company had approximately $13,500,000 of long-term debt, $360,000 of
Subordinated Notes and approximately $23,700,000 of obligations under capital
leases. Scheduled payments of principal and interest under debt obligations and
capital leases are approximately $6,600,000 during the last six months of 1996.
In addition, scheduled payments under operating leases and related maintenance
and service agreements are approximately $1,300,000 during the last six months
of 1996. The Company must increase its revenues and reduce its cost structure
and debt payment schedules in order to meet its obligations as they become due.
There can be no assurance that the Company will be able to meet its scheduled
obligations as they become due in the last two quarters of 1996. Further, the
high debt level may adversely affect the Company's ability to offer
technologically advanced equipment in the future to customers, which may
adversely affect the Company's ability to secure or retain profitable contracts.
4
<PAGE> 7
LIMITED ACCESS TO CAPITAL AND FINANCING
The Company is severely limited by covenants in its credit agreements from
incurring additional indebtedness without the consent of its lenders. In
addition, the Company has pledged substantially all of its liquid assets and
substantially all of its tangible personal property and real property to secure
its existing debt. As a result, the Company has very little financial
flexibility to address unforeseen cash needs, to fund future growth or to
finance necessary equipment purchases and upgrades.
POTENTIAL INABILITY TO REPAY MATURING INDEBTEDNESS
A substantial portion of the Company's funded debt will mature in the near
future. During the last four months of 1996 and 1997, approximately $3,100,000
and $9,400,000 plus the then outstanding balance (currently approximately
$3,603,000 at September 15, 1996) of the Company's revolving credit facility
will become due. The Company does not expect to have sufficient cash resources
to pay all of these obligations at maturity. Accordingly, the Company will be
required to seek new financing to meet its maturing obligations. There can be no
assurance that such financing will be available or that the terms of any such
financing will be acceptable to the Company.
TREND OF DECREASING REVENUES
The Company's revenues decreased during each of the last three fiscal
years. For the three years ended December 31, 1993, 1994 and 1995, revenues were
$39,485,000, $38,545,000 and $34,077,000, respectively. This decrease in
revenues is a result of the sale by the Company of various revenue-producing
assets, reduced demand for certain of the Company's imaging services and severe
competition which have led to reduced pricing for the Company's services. This
trend resulted in significant operating losses and, during the period from late
1992 until May 1995, the Company failed to meet certain of its fixed
obligations. The Company must increase its revenues or decrease its expenses in
order to remain viable. There can be no assurance that the Company will be able
to increase its revenues or decrease its expenses sufficiently to cover its
fixed obligations.
POSSIBLE DELISTING OF COMMON STOCK AND LOSS OF ACTIVE TRADING MARKET
The Common Stock is currently traded on the American Stock Exchange ("the
AMEX") and The Pacific Stock Exchange ("The PSE"). The announcement by the
Company of the terms of a restructuring in early April 1994 was followed by a
significant decline in the market price of the Common Stock. The Company's
losses and net capital deficiency have caused the Company to no longer satisfy
the minimum criteria with respect to net income and net worth for continued
listing published by the AMEX. The per share trading price of the Common Stock
is also below the minimum criteria for continued listing on such exchange. The
closing per share price was $1.375 on September 23, 1996. The Company has been
advised that its net capital deficiency is inconsistent with the criteria
applied by The PSE for continued listing on such exchange. The AMEX and The PSE
are currently reviewing the Company's financial condition following the
restructuring in order to determine whether the Common Stock will continue to be
listed on such exchanges. Accordingly, no assurances can be given that a holder
of Common Shares will be able to sell Common Shares in the future on a national
or regional securities exchange, or that there will be an active trading market
for the Common Shares or as to the price at which the Common Shares might trade.
INABILITY OF COMPANY TO PAY DIVIDENDS
The Company is prohibited by its credit agreements from paying dividends on
the Common Shares and does not anticipate being in a position to pay dividends
for the foreseeable future.
INABILITY OF NON-AFFILIATES TO SELL COMMON STOCK
At October 6, 1996 there were 4,769,384 shares of Common Stock outstanding
and an additional 2,185,700 shares of Common Stock issuable under immediately
exercisable warrants and options. Approximately 2,298,659 of these shares and an
additional 2,102,793 shares underlying immediately exercisable
5
<PAGE> 8
options or warrants that are owned by "affiliates" would normally be subject to
limitations on resale; however, all of such shares, options and warrants are
currently eligible for sale pursuant to effective registration statements. The
trading market for the Common Stock is thin. The average weekly trading volume
of the Common Stock on the AMEX since May 1, 1995 is approximately 5000 shares.
Accordingly, non-"affiliate" holders may find it extremely difficult to sell
their Common Shares, and the price thereof may be depressed for an indefinite
period by the number of "affiliate" shares available for resale pursuant to
effective registration statements.
CONTROL BY MAJOR SHAREHOLDERS; POTENTIAL CONFLICT OF SHAREHOLDER INTERESTS
As of October 6, 1996, Ernest A. Bates, M.D., the Company's Chairman and
Chief Executive Officer, owned (directly or through immediately exercisable
options) 2,485,500 shares of Common Shares, which represents approximately 35.7%
of the Company's outstanding Common Shares and Common Shares exercisable
pursuant to immediately exercisable options. In addition, as a result of
securities issued to them pursuant to the Restructuring, certain securityholders
of the Company (the "Restructuring Holders") own directly or through immediately
exercisable warrants 1,732,000 shares of Common Stock, representing
approximately 24.9% of the outstanding Common Shares and Common Shares
exercisable pursuant to immediately exercisable options. Dr. Bates and certain
of the Restructuring Holders acting together will have the power to determine
the outcome of a shareholder vote with respect to any fundamental corporate
transaction, including mergers and the sale of all or substantially all of the
Company's assets. This could have the effect of blocking transactions that a
majority of the other shareholders would otherwise find attractive, or
conversely, permitting Dr. Bates and the Restructuring Holders to adopt
transactions that a majority of the other shareholders vote to reject.
Accordingly, owners of Common Shares other than Dr. Bates and the Restructuring
Holders should recognize that their interests may conflict and, as a result of
the size of their shareholdings, Dr. Bates and such Restructuring Holders will
be able effectively to determine the course of action to be taken by the
Company.
DEPENDENCE ON KEY PERSONNEL
The Company's operations and business are dependent to a significant extent
upon the continued active participation of its founder, Chairman of the Board
and Chief Executive Officer, Ernest A. Bates, M.D. In the past, Dr. Bates has
personally guaranteed various financial obligations of the Company, which has
enabled the Company to obtain credit. Certain of the Company's lenders have also
sought to insure the continued involvement of Dr. Bates by requiring his
personal guarantee of a significant amount of the Company's debt. Should Dr.
Bates become unavailable to the Company for any reason, it could have a material
adverse effect on the Company's business, results of operations, financial
condition and prospects.
INABILITY OF COMPANY TO ACQUIRE ADVANCED TECHNOLOGY
Diagnostic imaging technology is subject to continuous development and
change. New technological breakthroughs may require the Company to acquire new
or technologically improved products to service its customers. There can be no
assurance that the Company's financial resources will enable it to make the
investment necessary to acquire such products. The failure to acquire or use new
technology and products could have a material adverse effect on the Company's
business and results of operations.
EXPANSION OF REIMBURSEMENT PROGRAMS
Customers to which the Company provides services generally receive payment
for patient care from governmental and private insurer reimbursement programs.
As a result, a significant adverse change in such reimbursement policies might
have a material adverse effect on the Company's business and results of
operations. As a result of federal cost-containment legislation currently in
effect, hospital in-patients covered by federally funded reimbursement programs
are classified into diagnostic related groups ("DRG") in accordance with the
patient's diagnosis, necessary medical procedures and other factors. Patient
reimbursement is limited to a predetermined amount for each DRG. Because the
reimbursement payment is predetermined, it does not necessarily cover the cost
of all medical services actually provided. Currently the
6
<PAGE> 9
DRG system is not applicable to out-patient services, and consequently many
health care providers have an incentive to treat patients on an out-patient
basis. If the DRG program is at some future date expanded to include out-patient
reimbursement, such change could have a material adverse effect on the Company's
business and results of operations.
RISK OF ADVERSE HEALTHCARE REFORM LEGISLATION
In addition to extensive existing government healthcare regulation, there
are numerous initiatives at the federal and state levels for comprehensive
reforms affecting the payment for and availability of healthcare services,
including a number of proposals that would significantly limit reimbursement
under Medicare and Medicaid. It is not clear at this time what proposals, if
any, will be adopted or, if adopted, what effect such proposals would have on
the Company's business. Aspects of certain of these healthcare proposals, such
as cutbacks in the Medicare and Medicaid programs, containment of healthcare
costs on an interim basis by means that could include a short-term freeze on
prices charged by healthcare providers, and permitting greater state flexibility
in the administration of Medicaid, could adversely affect the Company. There can
be no assurance that any currently proposed or future healthcare legislation or
other changes in the administration or interpretation of governmental healthcare
programs will not have an adverse effect on the Company.
BURDEN AND COST OF GOVERNMENT REGULATION
Many aspects of the medical industry in the United States are subject to a
high degree of governmental regulation. Generally, failure to comply with any
such regulations may result in denial of the right to conduct business and
significant fines. For example, legislation in various jurisdictions requires
that health facilities obtain a Certificate of Need ("CON") prior to making
expenditures in excess of specified amounts. The CON procedure can be expensive
and time consuming, and consequently a health care facility may elect to use the
Company's services rather than purchase equipment subject to CON requirements.
CON requirements vary from state to state as they apply to the operations of
both the Company and its customers. In some jurisdictions the Company is
required to comply with CON procedures before operating its services and in
other jurisdictions customers must comply with CON procedures before using the
Company's services. An increase in the complexity or substantive requirements of
such federal, state and local laws and regulations could adversely affect the
Company's business.
COMPETITION
The Company faces severe competition from other providers of diagnostic
imaging services, some of which have greater financial resources than the
Company, and from equipment manufacturers, hospitals, imaging centers and
physician groups owning in-house diagnostic units. Significant competitive
factors in the diagnostic services market include equipment price and
availability, performance quality, ability to upgrade equipment performance and
software, service and reliability. The Company's financial problems have
adversely affected its ability to obtain and retain certain profitable customer
contracts, and its high debt burden may adversely affect its ability to offer
technologically advanced equipment in the future. There can be no assurance that
the Company will be able to retain its competitive position in the medical
imaging industry.
THE COMPANY
The Company provides shared diagnostic imaging services and radiotherapy
services to approximately 220 hospitals, medical centers and medical offices
located in 22 states. The four principal diagnostic imaging services provided by
the Company are Magnetic Resonance Imaging (MRI), Computed Axial Tomography
Scanning (CT), Ultrasound and Nuclear Medicine. Radiotherapy services are
performed by the Company through a subsidiary which provides Gamma Knives to two
major university medical centers.
ASHS's address is Four Embarcadero Center, Suite 3620, San Francisco,
California 94111 and its telephone number is (415) 788-5300.
7
<PAGE> 10
FINANCIAL RESTRUCTURING
NOTES REPURCHASE AND LEASE RESTRUCTURING
Beginning in 1992, the Company experienced substantial declines in revenues
from its businesses. The revenue declines, which were caused by increased
competition and reduced acceptance of the services offered by the Company,
combined with high fixed payment obligations under existing leases and the
Subordinated Notes, led to a serious cash shortage in the second half of 1992.
During this period the Company concluded that revenues from its operating
activities would be insufficient to meet its fixed obligations and determined
that these obligations would have to be restructured.
The Company failed to make the required semi-annual payments due under the
Subordinated Notes beginning on October 15, 1992. In addition, the Company
suspended lease payments on a significant portion of its leases beginning on
December 1, 1992. As a result of these actions, both the Subordinated Notes and
the equipment leases relating to substantially all of the Company's medical
imaging equipment were in default. This gave the holders of such obligations, as
well as the lender under the Company's secured working capital facility, the
right to declare all amounts immediately due and payable and, in the case of the
leases, reclaim substantially all of the Company's medical imaging equipment.
The Company stated that any such action by the holders would have forced the
Company to seek a liquidation under Chapter 7 or a reorganization under Chapter
11 of the United States Bankruptcy Code.
On May 17, 1995, the Company repurchased (the "Notes Repurchase")
$17,694,000 principal amount of Subordinated Notes from certain holders for
consideration consisting of $3,893,000 in cash, 819,000 shares of Common Stock
and immediately exercisable Warrants to purchase an additional 216,000 shares of
Common Stock, at an exercise price of $0.75 per share, representing 20% and 5%,
respectively, of the then fully diluted Common Stock.
The Notes Repurchase was the culmination of a broad restructuring of the
Company's capital structure that commenced in mid-1992. As part of the
restructuring, the Company was able to amend most of the capital and operating
leases covering its medical equipment (the "Lease Restructuring") to reduce
monthly payments, eliminate $26,547,000 of indebtedness (including principal and
accrued and unpaid interest) through the Notes Repurchase and replace its
operating line of credit. On the date of the Notes Repurchase, the Company
entered into three new credit facilities totalling $8,000,000 (which were
subsequently increased to their current availability of $8,500,000) which
provided funds for the Notes Repurchase and working capital, as well as term
debt reduction and the refinancing of certain medical equipment. As a result,
the Company was able to cure all existing defaults on its debt and equipment
leases.
EXCHANGE OFFER
Despite the Notes Repurchase and the Lease Restructuring, the Company
remains highly leveraged and has substantial near-term fixed obligations. See
"Risk Factors -- High Debt Level." See "Risk Factors -- Potential Inability to
Repay Maturing Indebtedness." In June 1996 the Company offered to exchange (the
"Exchange Offer") Common Shares for any and all outstanding Senior Subordinated
Notes. The Exchange Offer was completed on August 30, 1996.
The Exchange Offer resulted in a significant reduction in the outstanding
Senior Subordinated Notes. Holders of $413,000 aggregate principal amount of
Senior Subordinated Notes elected to exchange them for 286,936 newly issued
Common Shares. As a result, the Company's total payment obligation in respect of
maturing Senior Subordinated Notes on October 15, 1996 was approximately
$389,000, consisting of $360,000 of principal and approximately $29,000 of
accrued interest.
8
<PAGE> 11
CAPITALIZATION
The following table sets forth the capitalization of the Company at August
31, 1996:
<TABLE>
<CAPTION>
AUGUST 31, 1996
---------------
<S> <C>
Current portion of long-term debt...................................... $ 7,273,000
Current portion of obligations under capital leases.................... 6,724,000
Senior Subordinated Notes.............................................. 360,000
------------
Total current obligations............................................ 14,357,000
============
Long-term debt, less current portion................................... 6,253,000
Obligations under capital leases less current portion.................. 16,989,000
------------
Total long-term obligations.......................................... 23,242,000
------------
Total Obligations............................................ 37,599,000
------------
Stockholder's equity (Net Capital Deficiency):
Common stock, without par value:
authorized shares -- 10,000,000, 4,629,000 shares issued and
outstanding(1).................................................... 11,066,000
Common stock options issued to officer............................... 2,414,000
Additional paid-in capital........................................... 930,000
Accumulated deficit.................................................. (25,061,000)
------------
Total stockholders' equity (Net Capital Deficiency).......... (10,651,000)
------------
TOTAL CAPITALIZATION......................................... $ 26,948,000
============
</TABLE>
- ---------------
(1) Does not include (i) 330,000 Common Shares reserved for issuance upon
exercise of options granted under the Company's 1995 Stock Option Plan, (ii)
151,200 Common Shares reserved for issuance for options remaining
exercisable under the Company's 1984 Stock Option Plan, (iii) 441,147 Common
Shares underlying unexercised Warrants, or (iv) 1,495,000 Common Shares
underlying an unexercised option issued to Ernest A. Bates, M.D.
USE OF PROCEEDS
The Company will not receive any of the proceeds from the sale of the
Common Shares. All of the proceeds will be received by the Selling
Securityholders. See "Selling Securityholders."
DETERMINATION OF OFFERING PRICE
The offering price of the Common Shares will be determined by the Selling
Securityholders in transactions entered into by them regarding the Common
Shares. See "Plan of Distribution."
9
<PAGE> 12
SELLING SECURITYHOLDERS
This Prospectus relates to the offer and sale by the Selling
Securityholders of Common Shares that were acquired by them in private
transactions prior to the date of this Prospectus and, in the case of Dr. Bates,
Common Shares underlying an immediately exercisable stock option, all as
specified in the table below. The Company intends to keep the Registration
Statement to which this Prospectus relates continuously effective until all of
the Common Shares have been disposed of in accordance with the Registration
Statement or Rule 144 under the Securities Act or when the restrictions on
transfer by the Selling Securityholders under the Securities Act shall no longer
be applicable.
The Securities offered by this Prospectus are offered for the account of
the Selling Securityholders. The following table sets forth, as of September 15,
1996, the names of the Selling Securityholders, their positions with the
Company, and the number of Common Shares owned by them and offered pursuant to
this Prospectus.
SELLING SECURITYHOLDERS
<TABLE>
<CAPTION>
COMMON COMMON
NAME/POSITION WITH COMPANY SHARES OWNED SHARES OFFERED
- ----------------------------------------------------------- ------------ --------------
<S> <C> <C>
Ernest A. Bates, M.D., .................................... 2,485,500(1) 2,485,500(1)
Chairman and Chief Executive Officer
Matthew Hills, Director.................................... 1,582(2) 1,582(2)
Arthur E. Lyons, M.D. ..................................... 12,250(5) 10,000(3)
Gertrude Kaufman........................................... 500(3) 500(3)
Richard Magary, ........................................... 83,300(4)(5) 10,000(3)
Senior Vice President-Administration
John F. Ruffle, Director................................... 80,711(2)(5) 55,511(2)(5)
Craig K. Tagawa,........................................... 137,600(4)(5)(6) 10,000(3)
Senior Vice President and Chief Financial Officer
Stanley S. Trotman, Jr., .................................. 102,962(2)(5) 102,962(2)(5)
Director
Augustus A. White, M.D., .................................. 17,992(2)(4) 2,992(2)
Director
</TABLE>
- ---------------
(1) Includes 1,495,000 Common Shares underlying an immediately exercisable stock
option.
(2) Represents or includes Common Shares issued in lieu of cash Directors' fees.
(3) Represents Common Shares acquired in a private transaction from an
"affiliate" of the Company.
(4) Includes Common Shares underlying currently exercisable options issued
pursuant to the Company's 1984 Stock Option Plan and/or 1995 Stock Option
Plan.
(5) Includes Common Shares acquired in a private transaction from an "affiliate"
of the Company.
(6) Includes 10,000 Common Shares beneficially owned by Craig K. Tagawa and
Helen H. Tagawa, as joint tenants.
Because the Selling Securityholders may sell all or a part of their Common
Shares, no estimate can be given as to the number of Common Shares to be held by
any Selling Securityholder upon termination of the offering. The Common Shares
owned by the Selling Securityholders directly or pursuant to immediately
exercisable options represent approximately 42.0% of the issued and outstanding
Common Shares and Common Shares underlying immediately exercisable options as of
October 6, 1996.
10
<PAGE> 13
PLAN OF DISTRIBUTION
The Selling Securityholders may sell the Common Shares (i) in an
underwritten offering or offerings, (ii) through brokers and dealers, (iii) "at
the market" to or through a market maker or into an existing trading market, on
an exchange or otherwise, for such shares, (iv) in other ways not involving
market makers or established trading markets, including direct sales to
purchasers and (v) to the extent not prohibited by applicable securities law, in
ways other than pursuant to the distribution plan presented in the Prospectus.
The Company intends to maintain the effectiveness of the registration statement
until all of the Common Shares have been sold, or until the earlier of (x) such
time as the Selling Securityholders receive an opinion of counsel that
registration is no longer required to effect public distribution of the Common
Shares and (y) the first date that all Common Shares shall have been disposed of
in accordance with the Registration Statement or Rule 144 under the Securities
Act.
The distribution of Common Shares may be effected from time to time in one
or more underwritten transactions at a fixed price or prices, which may be
changed, or at market prices prevailing at the time of sale, at prices related
to such prevailing market prices or at negotiated prices. Any such underwritten
offering may be on a "best efforts" or a "firm commitment" basis.
In connection with any such underwritten offering, underwriters or agents
may receive compensation from the Selling Securityholders for whom they may act
as agents in the form of discounts, concessions or commissions. Underwriters may
sell Common Shares to or through dealers, and such dealers may receive
compensation in the form of discounts, concessions or commissions from the
underwriters and/or commissions from the purchasers for whom they may act as
agents.
At any time a particular offer of Common Shares is made, if required, a
Prospectus Supplement will be distributed that will set forth the names of the
Selling Securityholder(s) offering such Common Shares, the aggregate amount of
such Common Shares being offered and the terms of the offering, including the
name or names of any underwriters, dealers or agents, any discounts, commissions
and other items constituting compensation from the Selling Securityholders and
any discounts, commissions or concessions allowed or reallowed or paid to
dealers. Such Prospectus Supplement and, if necessary, a post-effective
amendment to the Registration Statement of which this Prospectus is a part, will
be filed with the Commission to reflect the disclosure of additional information
with respect to the distribution of such Common Shares.
The Selling Securityholders and any underwriters, dealers or agents that
participate in the distribution of Common Shares may be deemed to be
underwriters, and any profit on the sale of Common Shares by the Selling
Securityholders and any discounts, commissions or concessions received by any
such underwriters, dealers or agents might be deemed to be underwriting
discounts and commissions under the Securities Act.
Under an agreement that may be entered into by the Company, underwriters,
dealers, and agents who participate in the distribution of Common Shares may be
entitled to indemnification by the Company against certain liabilities,
including liabilities under the Securities Act, or to contribution with respect
to payments which such underwriters, dealers or agents may be required to make
in respect thereof.
The sale of the Common Shares by the Selling Securityholders may also be
effected from time to time by Selling Securities directly to purchasers or to or
through certain broker-dealers. In connection with any such sale, any such
broker-dealer may act as agent for the Selling Securityholders or may purchase
from the Selling Securityholders all or a portion of the Common Shares as
principal and thereafter may resell any Common Shares so purchased. Sales by any
such broker-dealer, acting as agent or as principal, may be made pursuant to any
of the methods described below. Such sales may be made on the AMEX or The PSE or
other exchanges on which the Common Shares are then traded, in the
over-the-counter market, in negotiated transactions or otherwise at prices and
at terms then prevailing or at prices related to the then-current market prices
or at prices otherwise negotiated.
The Common Shares may also be sold in one or more of the following
transactions: (a) block transactions (which may involve crosses) in which a
broker-dealer may sell all or a portion of such shares as agent but may position
and resell all or a portion of the block as principal to facilitate the
transaction; (b) purchases by any such broker-dealer as principal and resale by
such broker-dealer for its own account
11
<PAGE> 14
pursuant to this Prospectus which is part of the Registration Statement; (c) a
special offering, an exchange distribution or a secondary distribution in
accordance with applicable stock exchange rules; and (d) ordinary brokerage
transactions and transactions in which any such broker-dealer solicits
purchasers. In effecting sales, broker-dealers engaged by the Selling
Securityholders may arrange for other broker-dealers to participate.
Broker-dealers will receive commissions or other compensation from the Selling
Securityholders in amounts to be negotiated immediately prior to the sale that
will not exceed those customary in the types of transaction involved.
Broker-dealers may also receive compensation from purchasers of the shares which
is not expected to exceed that customary in the types of transactions involved.
No director, officer or agent of the Company is expected to be involved in
soliciting offers to purchase the Common Shares offered hereby, and no such
person will be compensated by the Company for the sale of any of such Common
Shares. Certain officers of the Company may assist such representatives of the
Selling Securityholders in such efforts but will not be compensated therefor.
The Company will pay all of the expenses incident to the offering and sale
of the Common Shares, other than commissions, discounts and fees of
underwriters, dealers or agents.
DESCRIPTION OF COMMON SHARES
COMMON SHARES
The authorized capital stock of the Company consists of 10,000,000 Common
Shares, no par value. At September 15, 1996, 4,642,237 shares were issued and
outstanding and were held of record by approximately 410 persons. The Company
estimates there were approximately 1100 beneficial holders of its Common Shares
as of September 15, 1996. The Common Shares of the Company are listed on the
American Stock Exchange and The Pacific Stock Exchange under the symbol "AMS."
Each Common Share has the same rights, privileges and preferences as every
other share and will share equally in the Company's net assets upon liquidation
or dissolution. The Common Shares have no conversion or redemption rights or
sinking fund provisions. All Common Shares outstanding are, and all Common
Shares issued upon exercise of outstanding warrants and options will be, validly
issued, fully paid and non-assessable. The Common Shares have no preemptive
rights. Shareholders are entitled to one vote for each share owned on all
matters submitted to the shareholders and have the right, subject to certain
conditions, to elect to cumulate their votes in the election of directors.
Shareholders are entitled to receive such dividends as may be declared by the
Board of Directors out of funds legally available therefor. The Company did not
pay dividends in 1993, 1994 or 1995 and does not intend to pay dividends in the
near future. The Company is a party to various financing agreements that
prohibit the declaration of dividends on the Common Shares. See "Risk Factors --
Inability of Company to Pay Dividends."
The transfer agent and registrar for the Common Shares is American Stock
Transfer & Trust Company, New York, New York.
LEGAL MATTERS
Certain legal matters with respect to the validity of the Common Shares
offered hereby will be passed upon for the Company by Sidley & Austin, Los
Angeles, California.
EXPERTS
The consolidated financial statements and schedule of American Shared
Hospital Services at December 31, 1995 and 1994 and for each of the three years
in the period ended December 31, 1995 appearing in the Company's Annual Report
on Form 10-K for the year ended December 31, 1995 have been audited by Ernst &
Young LLP, independent auditors, as set forth in their report thereon included
therein and incorporated herein by reference, which report contains an
explanatory paragraph with respect to the substantial doubt surrounding the
Company's ability to continue as a going concern mentioned in Note 1 to the
consolidated financial statements. Such consolidated financial statements and
schedule are incorporated herein by reference in reliance upon such report given
upon the authority of such firm as experts in accounting and auditing.
12
<PAGE> 15
- ------------------------------------------------------
- ------------------------------------------------------
NO DEALER, SALESPERSON OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED IN OR
INCORPORATED BY REFERENCE INTO THIS PROSPECTUS, AND, IF GIVEN OR MADE, SUCH
INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED
BY THE COMPANY OR ANY OTHER PERSON. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER
TO SELL OR A SOLICITATION OF AN OFFER TO BUY ANY OF THE COMMON SHARES OFFERED
HEREBY BY ANYONE IN ANY JURISDICTION IN WHICH SUCH OFFER OR SOLICITATION IS NOT
AUTHORIZED OR IN WHICH THE PERSON MAKING SUCH OFFER OR SOLICITATION IS NOT
QUALIFIED TO DO SO OR TO ANY PERSON TO WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER OR
SOLICITATION. NEITHER THE DELIVERY OF THIS PROSPECTUS NOR ANY SALE MADE
HEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THE
INFORMATION CONTAINED HEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO THE DATE OF
THIS PROSPECTUS.
------------------
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Available Information................. 2
Incorporation of Certain Documents by
Reference........................... 2
Risk Factors.......................... 4
The Company........................... 7
Financial Restructuring............... 8
Use of Proceeds....................... 9
Determination Of Offering Price....... 9
Selling Securityholders............... 10
Plan of Distribution.................. 11
Description of Common Shares.......... 12
Legal Matters......................... 12
Experts............................... 12
</TABLE>
- ------------------------------------------------------
- ------------------------------------------------------
- ------------------------------------------------------
- ------------------------------------------------------
AMERICAN SHARED
HOSPITAL SERVICES
2,679,047 COMMON SHARES
------------------------------
PROSPECTUS
------------------------------
OCTOBER , 1996
- ------------------------------------------------------
- ------------------------------------------------------
<PAGE> 16
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The following table sets forth an itemized statement of all fees and
expenses in connection with the distribution of the securities being registered
pursuant to this Registration Statement, all of which fees and expenses will be
paid by the Registrant:
<TABLE>
<S> <C>
Securities and Exchange Commission registration fee...................... $ 1,328.00
Blue Sky fees and expenses............................................... $ 2,000.00*
Printing................................................................. $ 5,000.00*
Accountants' fees and expenses........................................... $20,000.00*
Legal fees and expenses.................................................. $35,000.00*
Miscellaneous............................................................ $ 1,672.00*
Total.......................................................... $65,000.00*
</TABLE>
- ---------------
* Estimates.
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Section 204(10) of the California General Corporation Law ("GCL") permits
the inclusion in the articles of incorporation of a California corporation of a
provision eliminating or limiting the personal liability of a director for
monetary damages in an action brought by or in the right of the corporation for
breach of a director's duties to the corporation and its shareholders. The
foregoing provision is subject to certain qualifications set forth in the GCL
including, without limitation, that such provision may not limit or eliminate
liability of directors for (i) intentional misconduct, (ii) transactions from
which a director derived an improper personal benefit, (iii) reckless disregard
of the director's duties, and (iv) an unexcused pattern of inattention. The
Company's Articles of Incorporation, as amended, contains an article eliminating
the liability of the directors for monetary damages to the fullest extent
permissible under California law.
Section 317 of the GCL permits the indemnification of officers, directors,
employees and agents of California corporations. Article Fifth, Section 2, of
the Company's Articles of Incorporation, as amended, provides that the
Registrant is authorized to provide indemnification to its agents in excess of
the indemnification otherwise permitted by Section 317 of the GCL.
Article IX, Section 7, of the Bylaws of the Company contains the following
indemnification provision:
Section 7. Indemnification of Corporate Agents; Purchase of Liability
Insurance. (a) The Corporation shall, to the maximum extent permitted by the
General Corporation Law of the state of California, and as the same may from
time to time be amended, indemnify each of its agents against expenses,
judgments, fines, settlements and other amounts actually and reasonably incurred
in connection with any proceeding to which such person was or is a party or is
threatened to be made a party arising by reason of the fact that such person is
or was an agent of the Corporation. For purposes of this Section 7, an "agent"
of the Corporation includes any person who is or was a director, officer,
employee or agent of the Corporation, or is or was serving at the request of the
Corporation as a director, officer, employee or agent of another foreign or
domestic corporation, partnership, joint venture, trust or other enterprise, or
was a director, officer, employee or agent of a foreign or domestic corporation
which was a predecessor corporation of the Corporation or of another enterprise
at the request of the such predecessor corporation; "proceeding" means any
threatened, pending or completed action or proceeding, whether civil, criminal,
administrative or investigative, and includes an action or proceeding by or in
the right of the Corporation to procure a judgment in its favor; and "expenses"
includes attorneys' fees and any expenses of establishing a right to
indemnification under this subdivision (a).
(b) The Corporation shall, if and to the extent the Board of Directors so
determines by resolution, purchase and maintain insurance in an amount and on
behalf of such agents of the Corporation as the Board
II-1
<PAGE> 17
may specify in such resolution against any liability asserted against or
incurred by the agent in such capacity or arising out of the agent's status as
such whether or not the Corporation would have the capacity to indemnify the
agent against such liability under the provisions of this Section 7.
Each of the directors of the Corporation has entered into an
Indemnification Agreement with the Company pursuant to which the Company is,
subject to the limitations in the following sentence, obligated to indemnify the
directors to the fullest extent provided by law, notwithstanding such
indemnification not specifically being provided in the Company's Articles,
Bylaws or by statute. The Company is not obligated under the Indemnification
Agreement to indemnify directors for the following: acts or omission or
transactions from which a director may not be relieved from liability under
Section 204 of the California General Corporation Law, a proceeding or action
instituted by an appropriate bank regulatory agency, claims initiated by such
director except with respect to proceedings to enforce a right of
indemnification unless the Board has approved the initiation or bringing of such
suit, a proceeding instituted by a director to enforce the Indemnification
Agreement which is found by a court of competent jurisdiction to be not in good
faith or frivolous, insured claims or claims under Section 16(b) of the
Securities Exchange Act of 1934.
For the undertaking with respect to indemnification, see Item 17 herein.
ITEM 16. EXHIBITS
The following exhibits are filed herewith:
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
- ------ ------------------------------------------------------------------------------------
<C> <S>
5.1 Opinion of Sidley & Austin regarding legality of certain securities being
registered.
23.1 Consent of Ernst & Young LLP.
23.2 Consent of Sidley & Austin, incorporated by reference to Exhibit 5.1 to this
Registration Statement.
</TABLE>
ITEM 17. UNDERTAKINGS
a. The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to Section 13(a) or 15(d) of the Exchange
Act that is incorporated by reference in the registration statement shall be
deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
b. Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and controlling persons of the
Company pursuant to the foregoing provisions, or otherwise, the registrant has
been advised that in the opinion of the Commission such indemnification is
against public policy as expressed in the Securities Act and is, therefore,
unenforceable. In the event that a claim for indemnification against such
liabilities (other than the payment by registrant of expenses incurred or paid
by a director, officer or controlling person of the registrant in the successful
defense of any action, suit or proceeding) is asserted by such director, officer
or controlling person in connection with the securities being registered, the
registrant will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate jurisdiction
the question whether such indemnification by it is against public policy as
expressed in the Securities Act and will be governed by the final adjudication
of such issue.
c. The undersigned registrant hereby further undertakes that:
(1) For purposes of determining any liability under the Securities
Act, the information omitted from the form of Prospectus filed as part of
this Registration Statement in reliance upon Rule 430A and contained in a
form of prospectus filed by the Registrant pursuant to Rule 424(b)(1) or
(4) or 497(h) under the Securities Act shall be deemed to be part of this
Registration Statement as of the time it was declared effective.
II-2
<PAGE> 18
(2) For the purpose of determining any liability under the Securities
Act, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial
bona fide offering thereof.
(3) To file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration Statement to include
any material information with respect to the plan of distribution not
previously disclosed in the Registration Statement or any material change
to such information in the Registration Statement.
(4) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
II-3
<PAGE> 19
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this Pre-Effective
Amendment No. 1 to the Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized in the City of San Francisco, state of
California on this 15th day of October, 1996.
AMERICAN SHARED HOSPITAL SERVICES
By: /s/ Ernest A. Bates
------------------------------------
Ernest A. Bates, M.D.
Chairman of the Board and Chief
Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this
Pre-Effective Amendment No. 1 to the Registration Statement has been signed by
the following persons in the capacities and on the date indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
- ------------------------------------- ---------------------------- -------------------
<S> <C> <C>
/s/ Ernest A. Bates Chairman of the Board October 15, 1996
- ------------------------------------- and Chief Executive Officer
Ernest A. Bates, M.D.
Director and Secretary
- -------------------------------------
Willie R. Barnes
/s/ Matthew Hills* Director October 15, 1996
- -------------------------------------
Matthew Hills
/s/ John F. Ruffle* Director October 15, 1996
- -------------------------------------
John F. Ruffle
/s/ Stanley S. Trotman, Jr.* Director October 15, 1996
- -------------------------------------
Stanley S. Trotman, Jr.
/s/ Augustus A. White* Director October 15, 1996
- -------------------------------------
Augustus A. White, III, M.D.
Director
- -------------------------------------
Charles B. Wilson, M.D.
/s/ Craig K. Tagawa* Chief Financial Officer October 15, 1996
- ------------------------------------- (Principal Accounting
Craig K. Tagawa Officer)
</TABLE>
* Executed by attorney-in-fact pursuant to power of attorney granted September
26, 1996.
/s/ Ernest A. Bates
--------------------------------------
Ernest A. Bates, M.D.
Attorney-in-fact
II-4
<PAGE> 20
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT SEQUENTIAL
NUMBER EXHIBIT DESCRIPTION PAGE NUMBER
- ------ ----------------------------------------------------------------------- -----------
<S> <C> <C>
5. Opinion of Sidley & Austin regarding legality of securities being
registered.............................................................
23.1 Consent of Ernst & Young LLP. .........................................
23.2 Consent of Sidley & Austin, incorporated by reference to Exhibit 5.1 to
this Registration Statement. ..........................................
</TABLE>
<PAGE> 1
[LETTERHEAD OF SIDLEY & AUSTIN]
EXHIBIT 5
OCTOBER 16, 1996
Board of Directors
American Shared Hospital Services
Four Embarcadero Center, Suite 3620
San Francisco, California 94111-4155
Re: Common Shares, no par value, of American
Shared Hospital Services (the "Common Stock")
Gentlemen:
We refer to the Registration Statement on Form S-3 (File No. 333-12879)
(the "Registration Statement") filed by American Shared Hospital Services, a
California corporation (the "Company"), with the Securities and Exchange
Commission under the Securities Act of 1933, as amended (the "Securities Act"),
relating to the registration for resale by the securityholders named therein of
2,679,047 shares of Common Stock. This opinion relates to such shares, comprised
of 1,184,047 issued and outstanding shares of Common Stock (the "Outstanding
Shares") and 1,495,000 shares of Common Stock (the "Option Shares") issuable
upon the exercise of an option granted to the Company's Chairman and Chief
Executive Officer.
We have acted as counsel to the Company in connection with the Registration
Statement and have examined such records, documents and questions of law, and
satisfied ourselves as to such matters of fact, as we have considered relevant
and necessary as a basis for this opinion. In addition, we have examined the
originals, or photocopies, of such other corporate records of the Company,
certificates of public officials and of officers of the Company and such
agreements, instruments and other documents as we have deemed necessary as a
basis for the opinions expressed below. We have assumed the authenticity of all
documents submitted to us as originals, the genuineness of all signatures, the
legal capacity of all natural persons and the conformity with the original
documents or any copies thereof submitted to us for our examination. As to
questions of fact material to such opinions, we have, when relevant facts were
not independently established by us, relied upon a certificate of the Company or
its officers or of public officials.
Based on the foregoing, we are of the opinion that:
1. The Company is duly incorporated and validly existing under the laws
of the State of California.
2. The Outstanding Shares are duly and validly issued, fully paid and
nonassessable shares of Common Stock.
3. The Option Shares, when issued in accordance with the terms of the
underlying option, and when certificates representing the Option
Shares have been duly executed and countersigned and duly delivered
to the persons entitled thereto against payment to the Company of the
exercise price provided for in the underlying option, will be duly
and validly issued, fully paid and nonassessable shares of Common
Stock.
We do not find it necessary for the purposes of this opinion to cover, and
accordingly we express no opinion as to, the application of the securities and
blue sky laws of the various states to the resale of the Outstanding Shares and
the Option Shares.
This opinion is limited to the laws of the State of California and the
United States of America, to the extent applicable.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and to all references to our firm included in or made a
part of the Registration Statement.
Very Truly yours,
/s/ SIDLEY & AUSTIN
<PAGE> 1
EXHIBIT 23.1
CONSENT OF INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption "Experts" in the
Registration Statement (Form S-3 No. 333-12879) and related Prospectus of
American Shared Hospital Services for the registration of 2,679,047 shares of
its common stock and to the incorporation by reference therein of our report
dated February 20, 1996, except for Note 16, as to which the date is March 8,
1996, with respect to the consolidated financial statements and schedule of
American Shared Hospital Services included in its Annual Report (Form 10-K) for
the year ended December 31, 1995, filed with the Securities and Exchange
Commission.
ERNST & YOUNG, LLP
October 14, 1996
Walnut Creek, California
