Good afternoon, and welcome to the First Quarter 2020 Conference. My name is Brandon, and I'll be your operator for today. Please note, this conference is being recorded. And I will now turn it over to Stephanie Prince. Stephanie, you may begin.

Thank you, Operator, 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 for the year ended December 31, 2019, and the definitive proxy statement at the annual meeting of shareholders to be held on June 26, 2020. The company assumes no obligation to update the information contained in this conference call. I would now like to turn the call over to Ray Stachowiak, Interim President and CEO. Ray?

Thank you, Stephanie. Good afternoon to everyone joining us today for our first quarter 2020 earnings conference call. I'll begin with some opening remarks and then ask Craig Tagawa, our COO and CFO, to go through the business and operational results. Alexis Wallace, our Controller, will then provide a financial review. Following that, Craig, Alexis, Ernie Bates, and I will open the call for your questions. I'd like to begin by reminding everyone that last month, Dr. Bates retired. I was appointed by the Board as Interim President and Chief Executive Officer. I've had a long, personal, and professional relationship with Dr. Bates and have great respect and admiration for what he has built here at American Shared Hospital Services for over 40 years. Dr. Bates is remaining as Executive Chairman of the Board through the end of this year, and I'm glad that he'll continue to be involved as we all work together to advance the company. Dr. Bates and I have a shared interest in capital-intensive, advanced medical technology for hospitals, which are in great need of creative and flexible financing solutions. I founded Shared Imaging in 1994. Shared Imaging is a preferred independent provider of CT, MRI, and PET/CT equipment and services. I grew Shared Imaging from $3 million to over $60 million a year in sales. We were profitable. I met Dr. Bates many years ago when he was interested in selling AMS' CT and MRI business. In 2008, I sold 50% of Shared Imaging. At that time, I asked Dr. Bates to join the Shared Imaging board, which he continues to serve. In 2013, I decided to retire as President of Shared Imaging, while serving in that role for over 19 years. As of today, I continue to own 50% of Shared Imaging and continue to serve as its founder owner. In 2009, Dr. Bates asked me to join the AMS Board. Since that time, I have steadily increased my ownership of AMS stock. I am now the company's largest shareholder, holding about 16% of the outstanding shares. I'm pleased to take on this management role because I think I can help AMS improve and get the credit and recognition that it deserves in the markets. The market value of the company has been hit hard in all the uncertainty from COVID-19, despite the company having over $30 million of tangible equity. The equipment and services that we provide through cancer patients, and cancer will not wait. I'm pleased to take on this. As a result, I believe that the healthcare industry, and in particular, cancer treatment will not be as negatively impacted as some other industries during this pandemic. Any softness in demand or delay in procedure should be made up fairly quickly. I have great belief in American Shared and its opportunities for growth. I'm here as Interim President and CEO to ensure that the company has the best leadership to realize those opportunities. Thank you for your continued support of our company. I will now turn the call over to Craig for the first quarter operational review. Craig?

Thank you, Ray, and good afternoon, everyone. Since our year-end conference call at the beginning of April, we've been closely monitoring the impact of the COVID-19 pandemic on our business. As expected in the first quarter, there was no material impact on our PBRT volumes due to the therapies focused on cancer patients whose procedures should not be postponed indefinitely. Most Gamma Knife procedures are also for cancer patients. Although, as we said on the last quarter call, approximately 40% of the procedures may be considered nonurgent and possibly subject to delayed treatment. In the second half of March, we did experience some softening of volumes in Gamma Knife, although the impact appeared more modest than we had initially anticipated. Gamma Knife revenue decreased 15.2% for the first quarter compared to the first quarter of 2019. The decline was related to two factors: first, we believe that the number of procedures which were consistent with the same period last year were potentially impacted by COVID-19. Procedures increased to 376 compared to 375 procedures in the first quarter of 2019. Procedures in the fourth quarter of 2019 totaled 414. Secondly, we also registered a decline in average reimbursement rates similar to last year's fourth quarter. The lower growth in procedures was magnified by lower overall reimbursement rates in this year's first quarter as compared to the rate we received in the same period last year. First quarter revenue for the proton therapy business increased 2.1% quarter-over-quarter and 12.8% sequentially from the fourth quarter of 2019. Total proton therapy fractions in the quarter increased by 130 or 8.4% quarter-over-quarter to 1,676 compared to 1,546 in the first quarter last year. Sequentially, fractions increased by 65 or 4% compared to 1,611 in the fourth quarter of 2019. Steady increases in awareness and across indications of benefits of proton therapy treatment are continuing to drive growth. Our operating income was also impacted in the first quarter of 2020 by higher SG&A costs related to legal and other fees related to but not limited to the COVID-19 pandemic and the transition in senior management. We completed two Cobalt-60 reloads during the first quarter and contracted to install one ICON upgrade with an existing customer. There are also additional upgrades being discussed that may be completed during the balance of the year, although it's especially hard to pinpoint the timing of these installations at this time. And while the pace has slowed a bit in the current environment, we've also continued to hold discussions with several interested parties for additional PBRT and MRI-LINAC placements. Looking ahead, in regard to COVID-19 and the second quarter-to-date, our volumes appear to be impacted but still remain fairly consistent with the prior year. Also, COVID-19's impact will be greater over the full three months of the second quarter versus only the second half of the last month of the first quarter. As noted in our press release this morning and as discussed in our past two quarterly conference calls, in July 2019, the Centers for Medicare and Medicaid Services, or CMS, announced a proposed 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' payment methodology for radiation oncology services. For the 60% of the centers not included in the proposed model, Medicare reimbursement in 2020 for the most commonly used proton therapy delivery codes is proposed to increase to approximately 15.5% and 3.6% for the Gamma Knife. However, as to be expected in the current environment, we have not yet received any additional information from CMS on the timing and selection details of the proposed payment models. 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 and administration for radiosurgery and radiation therapy could adversely affect our revenues and financial results. We'll keep you informed of any additional new information that we receive. With that, I'll turn the call over to Alexis for a detailed financial discussion. Alexis?

Thank you, Craig, and good afternoon, everyone. Before I begin my prepared remarks, I'd like to call your attention to our first quarter earnings press release that we've issued this morning. If you need a copy, you can access it on our website at ashes.com under the Press Releases in the Investors tab. For the three months ended March 31, 2020, total revenue decreased 14.2% to $4,568,000 compared to revenue of $5,321,000 in the first quarter of 2019. First quarter revenue for the company's proton therapy system installed at Orlando Health in Florida increased 2.1% to $1,676,000 compared to revenue for the first quarter of 2019 of $1,642,000. First quarter proton therapy revenue increased 12.8% sequentially from the $1,486,000 reported in the fourth quarter of 2019. Revenue for the company's Gamma Knife operations decreased 15.2% to $2,892,000 for the first quarter of 2020 compared to $3,411,000 for the first quarter of 2019. As Craig spoke about, the decline was due to lower average reimbursements at the company's retail sites as compared to the first quarter last year. Gross margin for the first quarter of 2020 decreased to $1,394,000 or 30.5% of revenue compared to gross margin of $1,137,000 or 36.4% of revenue for the first quarter of 2019. Net loss for the first quarter of 2020 was $135,000 or $0.02 per share. This compares to net income for the first quarter of 2019 of $270,000 or $0.05 per share. Fully diluted weighted average common shares outstanding were 6,153,000 for the first quarter of 2020 compared to 5,886,000 for the first quarter of 2019. Adjusted EBITDA, a non-GAAP financial measure, was $1,822,000 for the first quarter of 2020 compared to $2,710,000 for the first quarter of 2019. The decline was primarily due to lower net income, as well as lower depreciation and amortization due to the company's IGRT equipment, which became fully depreciated in the fourth quarter of 2019. At March 31, 2020, cash, cash equivalents and restricted cash were $3,023,000 compared to $1,779,000 at December 31, 2019. Shareholders' equity at March 31, 2020, was $31,473,000 or $5.53 per outstanding share. This compares to shareholders' equity at December 31, 2019, of $31,811,000 or $5.47 per outstanding share. This concludes the formal part of our presentation. Brandon, we'd like to now turn the call back over to you for questions.

And we have Anthony Marchese online.

Good afternoon, Ray, and congratulations on your new role. The stock currently trades at a third of tangible book. So I'm curious, from your perspective, you've been on the Board, you've had an association with the company, what do you believe the reason the discount exists? And more importantly, what are your plans to close the gap? Because it seems to me that a company of this type should not be trading below tangible book.

Thank you for your question. I think that's an excellent question. I'm not sure myself how the marketplace has determined this valuation of, like you said, about a third of our book value. One of the reasons for my investment has, quite frankly, been the fact that there is tangible equity in the company, and it's got substantial book value per share. So I'll let the marketplace make that determination. But I think if we can get a good leadership team in place with the retirement of Dr. Bates, I think we can see what added value we might be able to take the company from where it's at today.

We have Lenny Dunn online.

Yes. This is Lenny Dunn but that's okay. I have actually a few questions. The book value actually went up a little even though we reported a loss. And maybe, I don't know if Craig is the right person to explain that, but it's clear to me that we're a profitable company, and I'm not quite sure what the difference is. So if you could explain that, and then I have another question.

I'll let Alexis address your question, Lenny.

Yes. So the reason the book value went up is because we had some performance awards that were considered legally issued shares for management. Those were issued back in 2017, and they expired on March 31. So they went back into the plan. So you'll see that our outstanding shares actually went down for the period. And if you take a look at our filing, which should go up later today, there are some detailed discussions of how that's accounted for.

Okay. Well, that explains that to me, and that's fine. And then the other thing is you have some extraordinary legal and other costs that brought down our reported earnings. And I want to understand that those are nonrecurring, so when I model in what I think the company should be worth, I can do that. Are they nonrecurring? And can you break it down just a little bit?

Well, Lenny, I would say is that what we said is that these fees and legal fees and other fees were related in part to the COVID-19 pandemic and the transition in senior management. We also expect that a lot of these will hopefully be nonrecurring. But we're going to continue to have fees, whether they be legal or consulting as we try and add new services to the company and do some transactions that may be a little more difficult. So although we don't expect these fees to just perpetuate over time, we expect that there may be a new set of fees related to our ability to grow the company further.

Okay. I guess that's sort of an answer. And the COVID-19 situation, at least in my opinion, barring some disastrous reversal seems to be getting a little bit under control and at least the hospitals in our area, Wisconsin, and so on, are now doing elective procedures. And I think that there are likely that it is likely there'd be a backlog of people that use these 'elective procedures.' I don't think they're necessarily elective. They're just, I guess, in their wisdom, the government felt they were postponable. But the hospitals don't appear to be overwhelmed anymore with needing beds for the COVID-19 people, so they're moving forward with that. And then I think that's probably going to be the case nationally. So we should be able to resume to a more normal level of procedures for the Gamma Knife. The proton beam business, obviously, is going full blast, but the Gamma Knife business was restrained. Could you either criticize my opinion or comment on it?

Well, I'll comment on it. I think you're correct. Many of the hospitals are now starting to treat elective procedures. I think due to the COVID-19 pandemic, we saw that patients, even though they were already diagnosed and scheduled to receive treatment, they elected to delay their treatment, and that was a factor. Until people feel comfortable coming in, they may delay their treatment a little longer. That's one of the unknowns. And the other impact of the COVID-19 was the fact that patients weren't being diagnosed in a timely manner because people did not want to go into the hospital to get diagnosed. So that will take a little time to unwind itself as well. But as long as we continue to make progress on the COVID-19 pandemic and people feel comfortable coming into the hospital, I think, hopefully, we will see a return to more normality in terms of our patient treatments, both for the Gamma Knife and PBRT.

Okay. Because we certainly could use normalcy for a lot of reasons. But okay, and I could see why you would have all your potential PBRT contracts on hold because hospitals will be unlikely to want to make a major commitment until they can clearly see the future. Is that an accurate statement?

Yes. As we've mentioned before, and as I mentioned on this call in my prepared remarks, the APM model has brought in some uncertainty for PBRT. So I think we're waiting for that to clear up as well.

Okay. And I'd like to also comment that I appreciate Dr. Bates' leadership. I've only been involved with the company maybe a little over 20 years, but not the full 40 that he was around. So I just wanted to comment on that, too.

Thank you, Lenny.

We have Tony Kamin online.

Question, following up on the proton beam. I find it impressive that the Orlando Center has consistently achieved excellent results since its installation. I know this is somewhat overshadowed by the larger Gamma Knife business. Additionally, I think it's important to note that deposits have been made on two more Mevion systems. Given the strong performance in PBRT, I'm curious about the current finance environment, especially as hospitals may be more cautious. With the effects of COVID pushing interest rates down, is there potential for AMS to access financing in more favorable, innovative, and cost-effective ways? Or is the prevailing caution preventing any action in this environment?

I'll let Ernie answer that from the business development sales cycle standpoint.

Tony, this is Ernie Bates. It's an excellent question. If anything, what we're finding is given the uncertainty from the pandemic, we are finding that hospitals and other clinical partners are actually looking for creative financing solutions that they can acquire this capital-intensive equipment. So as Craig pointed out, yes, a lot of decisions are being placed on hold or in suspension given the uncertainty. But there are still discussions that are taking place with these centers that are interested in deploying this capital-intensive technology. And we're having those discussions. So in answer to your question, I would say that we are that alternative financing solution for many, many centers.

Yes, that's great. I think even though it was brought up on a previous conference call, this is the first time MR/LINAC was mentioned in the press release. It seems like an exciting addition to the product line that AMS can provide. I'm curious since it was included in the press release today, does the company believe this is a potential area for growth? If you could comment on that, it would be helpful.

Ernie, do you want to comment on that?

Sure. Yes, we do, Tony. I think I may have mentioned on previous calls that there are approximately 4,000 LINAC accelerators here in the United States. And roughly 1,000 of those units need to be replaced every 1 to 2 years. So there's a fairly high turnover rate. And given what we're seeing, as Craig mentioned, with the radiation oncology, APM, and episodic care, we're finding that clinical providers are trying to find ways to best capitalize on these opportunities to provide care in a bundled environment. And what's unique about the MR/LINAC is that it provides the ability to reshape the radiation treatment dose based on daily changes in the shape, size, and position of the tumor and surrounding healthy anatomy. The importance of that is that it enables an accurate dose delivery with real-time visualization of the tumor. And that's something you can't just do with a LINAC alone. The MR/LINAC enables that capability to basically see what you're treating. And with that, that enables clinicians to potentially provide higher and more effective radiation doses with fewer fractions. And so as I mentioned earlier, with bundled payments, if you're able to provide fewer fractions and receive reimbursement at a case rate, if you will, it's a big advantage to the clinical provider to be able to do that. So we're very excited about the opportunities with MR/LINAC.

Tony, this is Ray. I'd just like to reinforce that a bit too, because Dr. Bates really started the company's entry into looking at this technology, into MR/LINAC. And I'd just like to make sure that our investors understand that this product fits into our long-term strategic vision. It's a very capital-intensive product. Hospitals out there are searching for creative and flexible financing solutions. And I do think American Share can be in that marketplace.

Great. And I understand your longtime partner, Elekta, actually is a manufacturer of those machines. Is that correct?

That's correct.

Okay. It seems there are no more questions at this time. I will now hand it back to Ray for his closing remarks.

Thank you, everyone, for joining us today. I'm really excited to be here in my new role, and look forward to adding value to AMS. Please contact us if you have any questions before the second quarter conference call in mid-August. Stay safe, stay well, and have a great week. Goodbye.

Thank you, ladies and gentlemen. This concludes today's conference. Thank you for joining. You may now disconnect.