AMERICAN SHARED HOSPITAL SERVICES Commitments Disclosure

NOTE 10 – COMMITMENTS AND CONTINGENCIES

 

As of December 31, 2025, the Company had commitments to purchase and install two Leksell Gamma Knife Esprit (“Esprit”) systems and two Linear Accelerator (“LINAC”) systems. The Esprit upgrades and one LINAC installation are anticipated to occur in the second half of 2026, or later, at existing customer sites. The remaining LINAC is reserved for a future customer site. Total Gamma Knife and LINAC commitments as of December 31, 2025, were $7,884,000. There are no deposits on the consolidated balance sheets related to these commitments as of December 31, 2025.  It is the Company’s intent to finance substantially all of these commitments.  There can be no assurance that financing will be available for the Company’s current or future projects, or at terms that are acceptable to the Company.  

 

On September 4, 2022, the Company entered into a Maintenance and Support Agreement with Mevion (the “Mevion Service Agreement”), which provides for maintenance and support of the Company’s PBRT unit at Orlando Health from September 2022 through April 2026.  The Company’s maintenance commitment for the final service period, September 2025 through April 2026, is $1,184,000.

 

As of December 31, 2025, the Company had commitments to service and maintain its Gamma Knife, LINAC,  and PBRT equipment. The service commitments are carried out via contracts with Mevion, Elekta, Solutech, and Mobius Imaging, LLC. The Company’s commitments to purchase one LINAC system also includes a 5-year agreement to service the equipment, respectively. Total service commitments as of December 31, 2025 were $7,114,000. The Gamma Knife and certain other service contracts are paid monthly, as service is performed. The Company believes that cash flow from cash on hand and operations will be sufficient to cover these payments.

 

The Company’s customer contracts generally contain mutual indemnification provisions. The Company maintains general and professional liability insurance in the United States. The Company is not involved in the practice of medicine and therefore believes its present insurance coverage and indemnification agreements are adequate for its business. The Company’s Peruvian and Ecuadorian Gamma Knife centers and Mexican LINAC center are free-standing facilities operated by GKPeru, GKCE, and Puebla, respectively. The treating physicians and clinical staff at these facilities are independent contractors. The Company maintains general and professional liability insurance consistent with the operations of these facilities and believes its present coverage is adequate for its business.