Welcome to the Fourth Quarter and Year-End 2019 Financial Results Conference Call. My name is Daryl and I'll be your operator for today's call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session. [Operator Instruction] Please note that this conference is being recorded.I will now turn the call over to Stephanie Prince. Stephanie, you may begin.

Thank you, Daryl, and thank you to everyone joining us today. Before turning the call over to management, I would like to make the following remarks concerning forward-looking statements. Please note that various remarks that may be made on this conference call about future expectations, plans, and prospects for the Company constitute forward-looking statements for the purposes of safe harbor provisions under the Private Securities Litigation Reform Act of 1995.Actual results may vary materially from those indicated by these forward-looking statements, as a result of various important factors, including those discussed in the Company's filings with the SEC. This includes the Company’s annual report on Form 10-K and the quarterly reports on Form 10-Q for each three months of 2019 ended March, June and September, as well as the definitive proxy statements at the annual meeting of shareholders held on June 23, 2019. The Company assumes no obligation to update the information contained in this conference call.I would now like to turn the call over to Craig Tagawa, Chief Operating and Financial Officer. Craig?

Thank you, Stephanie, and good afternoon to everyone joining us today for our fourth quarter and year-end 2019 earnings conference call. I will begin by walking through our business and operational results. Alexis Wallace, our Controller, will then provide a financial review. Following that Dr. Bates, Alexis Wallace, Ernie Bates and myself will open the call for your questions.In the fourth quarter, our proton therapy business continued to post good growth, with revenue for the Orlando Health proton therapy system increasing 4.7% to 1,486,000 driven by higher volumes. Total proton therapy fractions in the quarter increased by 67 or 4.3%, quarter-over-quarter to 1,611 compared to 1,544 in the 2018 fourth quarter. For the full year, proton therapy revenue increased 23% and fractions were up 17%. Growing the awareness of the clinical benefits and expanding uses of proton therapy treatment continues to increase, which will support the continued growth of this important cancer therapy.Gamma Knife revenue in the fourth quarter increased by 4.1% to 3,230,000. The number of Gamma Knife procedures increased by 60 in the fourth quarter to 414 compared to 364 in last year's fourth quarter. The increase in procedures was driven by the continued ramping up of our standalone facility in Lima, Peru, as well as the addition of our new site in Merrillville, Indiana, which began treating patients in January 2019.Overall, the Gamma Knife business posted an increase in volume, but a decline in average reimbursement in the fourth quarter. We completed two Cobalt-60 reloads during the first quarter of 2020 and contracted for an Icon upgrade with existing customers. We've also continued to hold discussions with interested parties for additional PBRT and MR/LINAC placements as we previously disclosed. However, realistically, we expect a slowdown in these conversations as the country and healthcare system continues to deal with the COVID-19 pandemic.We do expect an impact on our business from the COVID-19 virus. We don't expect a significant impact on the proton therapy business, which is predominantly performed on patients with cancerous tumors. Assuming patients continue to be diagnosed on a timely basis, we expect near-term volumes to remain steady. However, approximately 40% of Gamma Knife procedures are considered non-urgent and maybe subject to delayed treatment due to COVID-19. We do see some softening in volumes at sight in March. We expect more of an impact during the second quarter although it's hard to be more specific at this time.As noted in our press release this morning and as discussed on our third quarter conference call in July, 2019, the centers for Medicare and Medicaid Services announced the proposed new mandatory payment model for radiation oncology services that is intended to test an episodic payment structure or bundled payment across certain radiation therapy providers and suppliers. CMS projects that approximately 40% of radiation oncology providers will be randomly selected and included in this model and approximately 60% will continue to receive reimbursement based on the current fee-for-service methodology.The proposed payment model would significantly alter CMS's payment methodology for radiation oncology services. For the 60% of the centers not included in the proposed model, Medicare reimbursement 2024 for the most commonly used proton therapy delivery codes is proposed to increase to approximately 15.5% and 3.6% for the Gamma Knife.The timing and details of the proposed payment model continue to remain uncertain. As a result, we cannot estimate the potential impact of adoption of the proposed rule. However, reductions in the reimbursement rates or changes in reimbursement methodology administration for radiosurgery and radiation therapy could adversely affect our revenues and financial results. We'll keep you informed of any new information that we received although it is probably prudent to expect a delay in the current environment.With that, I'll now turn the call over to Alexis for a detailed financial discussion. Alexis?

Thank you, Craig. Good afternoon everyone. Before I begin my prepared remarks, I'd like to call your attention to our fourth quarter and year end 2019 earnings results issued this morning. You can access a copy of the earnings release on our website ashs.com at Press Releases under the investors tab.For the three months ended December 31, 2019, revenue of $4,786,000 was consistent with revenue in the fourth quarter of 2018 of $4,770,000. Fourth quarter revenue for our proton therapy system installed at Orlando Health in Florida increased 4.7% to $1,486,000, compared to revenue for the fourth quarter of 2018 of $1,419,000.Revenue for the Company's Gamma Knife operations increased 4.1% to $3,230,000 for the fourth quarter of 2019, compared to $3,102,000 for the fourth quarter of 2018. The increase is due to increased volumes at existing sites offset by a decline in average reimbursement at the Company's retail sites.Gross margin for the fourth quarter of 2019 decreased to $1,441,000 or 30.1% of revenues, compared to gross margin of $1,565,000 or 32.8% of revenue for the fourth quarter of 2018. The decrease is due to higher depreciation on the Gamma Knife and IGRT equipment at a customer location for contracts whose contracts are set to expire in the second quarter of 2020.Net income for the fourth quarter of 2019 was $193,000, or $0.03 per share. This compares to net income for the fourth quarter of 2018 of $178,000, or $0.03 per share and $165,000 or $0.3 per share in the third quarter of 2019.Adjusted EBITDA, a non-GAAP financial measure was $2,056,000 for the fourth quarter of 2019, compared to $2,346,000 for the fourth quarter of 2018. On the balance sheet at December 31, 2019, cash, cash equivalents and restricted cash was $1,779,000, compared to 1,792,000 at December 31 2018.Shareholders' equity at December 31, 2019 was $31,811,000 or $5.47 per outstanding share. This compares to shareholders equity at December 31, 2018 of $31,040,000 or $5.43 for outstanding share. Issued and outstanding shares totaled of $5,817,000 at December 31, 2019 compared to $5,714,000 at December 31 2018.This concludes the formal part of our presentation. Daryl, we'd like to now turn the call back over to you for questions.

[Operator Instructions] It looks like Lenny Dunn. Go ahead.

Yes. Certainly, understand that there's very little guidance you can give in the current environment, and obviously, everyone else find hope that the country starts to open up some mid-May or early June, but there's no guarantees for that, and hospitals aren't going to do elective work until this is better controlled. So I don't have my normal questions because I understand that everything is on hold, but actually would be interested in your medical opinions as to what your thoughts are on getting this opened up and get ready for the second wave maybe in the fall. But anyhow, that's about the only question I would have.

I think at this point, obviously, it's unknown and people are working very diligently to come up with some cures or vaccines to combat this, but I think it's too early to tell at this point. And we're all hoping it is over with in a fairly short period of time, but there's obviously no guarantee as to the length that this will last.

I understand it. So personal viewpoint. I'm in a category where I have to look like a hermit and not even see my grandkids until this gets under better control. So I mean, I'm looking forward to an end, as everybody in the country probably is but don't have anything to add.

Thank you, Lenny.

[Operator Instructions] We have a question from -- it sounds like Tim Graceburn [ph], if you queued up for question, ask your question.

Yes. I've noticed your accounts receivable balance is increasing. It's up by 170%, but over the past four years that your allowance for doubtful accounts has remained steady at 100,000. Could you speak to that please? Dr. Ernie Bates: Alexis, I'll let you respond to that question.

Yes, the bulk of why it’s increasing is related to our proton therapy because the accounts receivable on a month-to-month basis are much larger for that site, and then it can be impacted. So at year-end, based on how many months of that we had collected, so we collected quite a bit in January related to that unit and a couple of other sites that had some large outstanding balances. So, you should see a drop amount in the first quarter. But generally, it's higher because of the volumes that are coming out of our proton therapy site.

We have another question. It’s from Anthony Marchese. Go ahead.

I have several questions. First of all, Craig, I wasn't very clear when you were, I guess, I'm confused when you started talking about CMS changes. On balance, assuming nothing changes, are the CMS changes beneficial to AMS?

If you look at it from a standpoint of the Gamma Knife, we believe it’s neutral in relation to the proton system under the new guidelines, which we don't know that these are final. It could decrease the reimbursement for protons in that currently, protons, as you know, are reimbursed on a per-fraction basis. And this will be based on indications treated cancer -- cancer’s indications treated. So, this could result from a Medicare standpoint, a lowering of treatment -- reimbursement for a course of treatment.

With respect to proton beam, I know, you guys have been talking about potentially adding new proton beam therapy. Is that -- I assume that's on hold, but has that opportunity gone away? Or is it on hold? How would you characterize the conversations at this point?

I’ll let Ernie Bates to answer that question for you, Anthony.

Okay. Dr. Ernest Bates: Tony, this is Ernie Bates. Can you please repeat the question again?

You guys are talking in the last conference call about the fact that you had the potential to add several proton beam sites. Given what's happened with COVID, are those conversations on hold at this point? Or are they going away? Are they continuing? I'm just curious as to where you guys are at least in your in your opinion at this point? Dr. Ernest Bates: Sure. Tony. Yes, I'll just say that for the most part, the discussion surrounding protons or the development of new proton centers are currently suspended, but there continues to be interest among our potential clinical partners to adopt a proton therapy to their centers. There is one site we can continue to have ongoing discussions with, and there's interest to develop a radiation therapy center which would ultimately include a single room proton system and facility. So, we are continuing to have ongoing discussions with the potential hospital and clinical partner on that.

Right. And you also, at one point, had discussed the potential for your Florida facility actually to have a second machine. Has that gone anywhere? Or is that still a potential?

It's still a potential and it's been analyzed at this at this point. But like everything else, it's slowed down with what's happening within the healthcare.

Right, yes, I mean my concern is just from a staff standpoint, you had a book value of, a tangible book value, if I'm not mistaken close to $5 a share and your stock’s at a $1.45. So, I'm scratching my head and trying understand why the disconnect. So I don't expect you to answer that but it's just an anomaly perhaps. But I had another final question relating to the Care Act and a number of the other initiatives that the federal government is now offering businesses. Do you guys plan to -- do you qualify? Or do you plan to take advantage of that?

We will have to look into that and see, if we would qualify or not to be honest with that, Anthony.

Okay. Obviously, I don't sit in your shoes, but unless -- it seems to me that you would qualify in some of the things being offered. I would think it would be extremely beneficial for you guys. So, obviously, I don't need to tell you. But I think you do qualify and obviously as a shareholder, we’d be interested in -- if you guys do qualify perhaps making some kind of public statements about it because as I said the advantages are many.

Yes, we would do that.

[Operator Instructions] Wait, we got another from Lenny Dunn. Go ahead.

Yes. This is not so much of a question, but it's my understanding that the SBA, if you go to your bank, will lend you interest-free 6 months' worth of payroll as long as you agreed to keep all your employees for 6 months. And at the end of the 6 months, they forgive the loan. So I can't imagine why you wouldn't want to take advantage of that.

We'll certainly look into that, Lenny. Thank you.

And we have another question from Robert Bachi [ph]. Go ahead, Robert.

I am a long, long member of your group, shareholder for years and I'll be celebrating my 90th birthday. What I'm hoping for, do you have any new product that you're working on that you haven't mentioned that would sort of catapult the price of the shares? Any new products that working on to increase your volume for anyone of the series of interest that you have now?

I think if you look at it, what we've announced is we're looking to upgrade some of our Gamma Knife sites with the Icon upgrade, which will allow us to do some larger tumors. And…

Yes. I know that I have seen that. And how is they are going?

Well, we just completed one in September at Kettering Medical Center and I think we also announced that, we will be putting one in at our Albuquerque site at Lovelace Medical Center. So, those are the first two that we will have done, and I think we're looking to partner with some of the hospitals to do the MR/LINAC unit. So, I think those are two of the things that we're looking at. And I'll let Ernie Bates comment, if there's anything else that he sees. Dr. Ernie Bates: Yes. I would also mention that we are looking at relatively new modalities that have received FDA approval and they're in the marketplace. There, I think we've talked about this modality in the past on previous calls, but both Elekta and a company called ViewRay have FDA-approved linear accelerators have an integrated MRI imaging device. And so, they're referred to as MRLs or MR/LINACs.And prior to this pandemic hitting, we were starting to see quite a bit of interest from a number of different potential clinical partners, both domestically and internationally to adopt this modality. So, we are definitely continuing to watch that space very closely. We're in close discussions with both vendors about potential revenue sharing opportunities with clinical partners.

And you feel that there's a need for those items that come into effect to be honored by these companies? You've done a great job trying to operate because I just hope you keep it. Dr. Ernie Bates: Yes, Bob. In fact, in the United States, there are approximately 4,000 linear accelerators, various institutions across the U.S., and of those 4,000, roughly a 1,000 or so of those units are replaced every year. And so, we've seen hospitals that are looking to replace older linear accelerators with this new modality. The issue that they have is that, the cost of that equipment is significantly higher than just swapping out to a new LINAC.And that's one of the reasons where we're seeing quite a bit of interest from hospital partners to mitigate that capital risk by partnering with American Shared. So, we see tremendous opportunity in that space, just as we did with the Gamma Knife 30-odd years ago, when...

Yes, Gamma Knife was a great thing for you, guys. Dr. Ernie Bates: That's right.

And I think my ears are limited, so I’d like to see some real -- I have about 35,000 shares and I'd like to see it go up before I croak. So keep growing and doing a good job. You're honest people and you're good people. And I know it's a rough competition from all over the world including over here in this country and just keep growing and I still have faith in you. So, thank you very much, Craig, for answering my questions. Thank you.

[Operator Instructions] We have a question from Tim Graceburn.

Yes, thank you for taking the question. I noticed the interest expense has gone down significantly. Can you reflect on if that is a reduction in the interest rates as you are trying to refinance long term debt? Or is it's a reduction in the overall balance combination of both? And anything you can provide.

I'll let Alexis to answer that question for you.

Yes. Primarily, it has to do with us paying down our balances. So, as we pay down those balances, the interest expense is going down and the principal portion of the payment is going up. We have done some refinancings in the last couple of years, so a lot of times when we do, a reload or and there's an existing balance on the debt or lease and we'll refinance that amount at a little bit lower rate. So, it's a combination.

[Operator Instructions] And we have no more questions at this time.

Okay, Daryl, thank you and I'll let Dr. Bates make his closing comments, if he'd like. Dr. Ernie Bates: Yes. I’d like to say I want to thank you all for joining us this afternoon. As the fights overcome the COVID-19 pandemic, the American Shared Hospital Services locations currently remains open to continue to meet the need for cancer patients, which represent the greatest part of our business.Looking beyond the pandemic, we believe that we remain well positioned for growth. We look forward to speaking with you again on the first quarter of 2020 conference call in early May. Until then, stay strong and healthy everyone. Goodbye.

And thank you again, ladies and gentlemen. This concludes today's conference. Thank you for participating. You may now disconnect.