<DOCUMENT>
<TYPE>DEF 14A
<SEQUENCE>1
<FILENAME>f81022ddef14a.txt
<DESCRIPTION>DEFINITIVE PROXY STATEMENT
<TEXT>
<PAGE>
                                  SCHEDULE 14A
                                 (RULE 14a-101)
                     INFORMATION REQUIRED IN PROXY STATEMENT
                            SCHEDULE 14A INFORMATION
           PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
                              EXCHANGE ACT OF 1934

Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ]    Preliminary Proxy Statement
[ ]    Confidential, For Use of the Commission Only (as permitted by
       Rule 14a-6(e)(2)
[X]    Definitive Proxy Statement
[ ]    Definitive Additional Materials
[ ]    Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12

                        American Shared Hospital Services
                (Name of Registrant as Specified in Its Charter)
    (Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)

Payment of Filing Fee (Check the appropriate box):
[X]      No fee required
[ ]      Fee computed on table below per Exchange Act Rules 14a-6(i)(1)
         and 0-11.

(1)      Title of each class of securities to which transaction applies:
(2)      Aggregate number of securities to which transactions applies:
(3)      Per unit price or other underlying value of transaction computed to
         Exchange Act Rule 0-11 (set forth the amount on which the filing fee is
         calculated and state how it was determined):
(4)      Proposed maximum aggregate value of transaction:
(5)      Total fee paid:

[ ] Fee paid previously with preliminary materials:

[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
the form or schedule and the date of its filing.

(1)      Amount previously paid:
(2)      Form, Schedule or Registration Statement no.:
(3)      Filing Party:
(4)      Date Filed:


                                       1
<PAGE>

                       AMERICAN SHARED HOSPITAL SERVICES
                      FOUR EMBARCADERO CENTER, SUITE 3700
                        SAN FRANCISCO, CALIFORNIA 94111

                 NOTICE OF 2002 ANNUAL MEETING OF SHAREHOLDERS
                           TO BE HELD ON JUNE 6, 2002

TO THE SHAREHOLDERS OF AMERICAN SHARED HOSPITAL SERVICES:

     NOTICE IS HEREBY GIVEN that, pursuant to a call of the Board of Directors,
the 2002 Annual Meeting of Shareholders (the "Meeting") of American Shared
Hospital Services, a California corporation (the "Company"), will be held at the
Ritz Carlton Hotel, 600 Stockton Street (corner of California Street), San
Francisco, California 94111 at 3:00 pm (Pacific time), on Thursday, June 6, 2002
to consider and to act upon the following matters, all as set forth in the Proxy
Statement.

          1. ELECTION OF DIRECTORS. To elect the following five nominees to the
     Board of Directors to serve until the next Annual Meeting of Shareholders
     and until their successors are elected and have qualified.

<Table>
<S>                                    <C>
Ernest A. Bates, M.D.                  Stanley S. Trotman, Jr.
Willie R. Barnes                       Charles B. Wilson, M.D.
John F. Ruffle
</Table>

          2. RATIFICATION OF INDEPENDENT ACCOUNTANTS. To ratify the appointment
     of Moss Adams LLP as the Company's independent accountants for the year
     ending December 31, 2002.

          3. OTHER BUSINESS. To transact such other business and to consider and
     take action upon any and all matters that may properly come before the
     Annual Meeting and any and all adjournments thereof.

     The Board of Directors knows of no matters, other than those set forth in
paragraphs (1) and (2) above, that will be presented for consideration at the
Meeting.

     The Board of Directors has fixed the close of business on April 12, 2002 as
the Record Date for the determination of shareholders entitled to vote at the
Meeting.

     WHETHER OR NOT YOU EXPECT TO ATTEND THE MEETING IN PERSON, PLEASE DATE,
SIGN AND MAIL THE ENCLOSED PROXY IN THE ENVELOPE PROVIDED AS PROMPTLY AS
POSSIBLE. THE PROXY IS REVOCABLE AND WILL NOT AFFECT YOUR RIGHT TO VOTE IN
PERSON IF YOU ATTEND THE MEETING. IN ORDER TO FACILITATE THE PROVISION OF
ADEQUATE ACCOMMODATIONS, PLEASE INDICATE ON THE PROXY WHETHER YOU PLAN TO ATTEND
THE MEETING IN PERSON.

                                          By Order of the Board of Directors

                                          /s/ WILLIE R. BARNES

                                          Willie R. Barnes
                                          Corporate Secretary

Dated: April 29, 2002
San Francisco, California
<PAGE>

                       AMERICAN SHARED HOSPITAL SERVICES
                      FOUR EMBARCADERO CENTER, SUITE 3700
                        SAN FRANCISCO, CALIFORNIA 94111
                            ------------------------

                                PROXY STATEMENT
                            ------------------------

                      2002 ANNUAL MEETING OF SHAREHOLDERS
                                  JUNE 6, 2002
                            ------------------------

                                  INTRODUCTION

     This Proxy Statement is being furnished to shareholders of American Shared
Hospital Services, a California corporation (the "Company"), in connection with
the solicitation of proxies by the Company's Board of Directors for use at the
2002 Annual Meeting of Shareholders scheduled to be held at the Ritz Carlton
Hotel, 600 Stockton Street (corner of California Street), San Francisco,
California 94111 at 3:00 pm (Pacific time) on Thursday, June 6, 2002 and at any
adjournment or adjournments thereof (the "Meeting"). It is anticipated that this
Proxy Statement and the Proxy will first be sent to shareholders on or about May
8, 2002.

     The matters to be considered and voted upon at the Meeting will be:

          1. To elect five persons to the Board of Directors to serve until the
     next Annual Meeting of Shareholders and until their successors are elected
     and have qualified.

          2. To ratify the appointment of Moss Adams LLP as the Company's
     independent accountants for the year ending December 31, 2002.

          3. To transact such other business as may properly be brought before
     the Meeting and any and all adjournments thereof.

     Only shareholders of record at the close of business on April 12, 2002 (the
"Record Date") are entitled to notice of and to vote at the Meeting.

REVOCABILITY OF PROXIES

     A proxy for use at the Meeting is enclosed. Any shareholder who executes
and delivers such proxy may revoke it at any time prior to its use by filing
with the Secretary of the Company either written instructions revoking such
proxy or a duly executed proxy bearing a later date. Written notice of the death
of the person executing a proxy, before the vote is counted, is tantamount to
revocation of such proxy. A proxy may also be revoked by attending the Meeting
and voting in person.

SOLICITATION OF PROXIES

     This proxy solicitation is being made by the Board of Directors of the
Company. The expense of the solicitation will be paid by the Company. To the
extent necessary to assure sufficient representation at the Meeting, proxies may
be solicited by any appropriate means by directors, officers, regular employees
of the Company and the stock transfer agent for the Common Shares, who will not
receive any additional compensation therefor. The Company will request that
banks, brokers and other fiduciaries solicit their customers who own
beneficially the Common Shares listed of record in names of nominees and,
although there is no formal arrangement to do so, the Company will reimburse
such persons the reasonable expenses of such solicitation. In addition, the
Company may pay for and utilize the services of individuals or companies not
regularly employed by the Company in connection with the solicitation of
proxies, if the Board of Directors of the Company determines that this is
advisable.
<PAGE>

OUTSTANDING SECURITIES

     The Board of Directors has fixed April 12, 2002 as the Record Date for the
determination of shareholders entitled to notice of, and to vote at, the
Meeting. At the close of business on the Record Date, there were outstanding and
entitled to vote 3,608,203 Common Shares. The Common Shares are the only class
of securities entitled to vote at the Meeting.

VOTE REQUIRED AND VOTING PROCEDURES

     Each holder of Common Shares will be entitled to one vote, in person or by
proxy, for each share standing in its name on the books of the Company as of the
Record Date for the Meeting on each of the matters duly presented for vote at
the Meeting, except as indicated below in connection with the election of
directors.

     In connection with the election of directors, shares are permitted to be
voted cumulatively, if (i) a shareholder present at the Meeting has given notice
at the Meeting, prior to the voting, of such shareholder's intention to vote its
shares cumulatively and (ii) the names of the candidates for whom such
shareholder desires to cumulate votes have been placed in nomination prior to
the voting. If a shareholder has given such notice, all shareholders may
cumulate their votes for candidates in nomination. Cumulative voting allows a
shareholder to give one nominee as many votes as is equal to the number of
directors to be elected, multiplied by the number of shares owned by such
shareholder or to distribute votes on the same principle between two or more
nominees. Discretionary authority to cumulate votes is hereby solicited by the
Board of Directors.

     All outstanding shares of the Company's Common Stock represented by
properly executed and unrevoked proxies received in time for the Meeting will be
voted. A shareholder may, with respect to the election of directors (i) vote for
the election of all five nominees named herein as directors, (ii) withhold
authority to vote for all such director nominees or (iii) vote for the election
of all such director nominees other than any nominee(s) with respect to whom the
shareholder withholds authority to vote by so indicating in the appropriate
space on the proxy. Withholding authority to vote for a director nominee will
not prevent such director nominee from being elected. A shareholder may, with
respect to the proposal to ratify the appointment of the Company's independent
accountants, (i) vote for the ratification, (ii) vote against the ratification,
or (iii) abstain.

     A proxy submitted by a shareholder may indicate that all or a portion of
the shares represented by such proxy are not being voted by such shareholder
with respect to a particular matter. This could occur, for example, when a
broker is not permitted to vote stock held in street name on certain matters in
the absence of instructions from the beneficial owner of the stock. The shares
subject to any such proxy which are not being voted with respect to a particular
matter (the "non-voted shares") will be considered shares not present and
entitled to vote on such matter, although such shares may be considered present
and entitled to vote for other purposes and will count for purposes of
determining the presence of a quorum. In the election of directors, the five
nominees receiving the highest number of votes of shares of Common Stock
represented in person or by proxy at the Meeting and entitled to vote on such
matter will be elected directors of the Company. Accordingly, non-voted shares
will not affect the outcome of the election of directors. Non-voted shares also
will not affect the outcome of the proposal to ratify the appointment of
independent accountants.

     In connection with the solicitation by the Board of Directors of proxies
for use at the Meeting, the Board of Directors has designated Ernest A. Bates,
M.D. and Craig K. Tagawa as proxies. Common Shares represented by properly
executed proxies will be voted at the Meeting in accordance with the
instructions specified thereon. If no instructions are specified, the Common
Shares represented by any properly executed proxy will be voted FOR the (1)
election of the five nominees for the Board of Directors named herein and (2)
ratification of the appointment of the Company's independent auditors.

     The Board of Directors is not aware of any matters that will come before
the Meeting other than as described above. However, if such matters are
presented, the named proxies will, in the absence of instructions to the
contrary, vote such proxies in accordance with the judgment of such named
proxies with respect to any such other matter properly coming before the
Meeting.

                                        2
<PAGE>

     A majority of the Common Shares outstanding on the Record Date must be
represented in person or by proxy at the Annual Meeting in order to constitute a
quorum for the transaction of business. In the election of directors, the five
candidates receiving the highest number of votes will be elected directors of
the Company. The proposal to ratify the appointment of the Company's independent
auditors require that a majority of those voting in person or by proxy to vote
FOR this proposal, in order for this proposal to be approved.

     The Board of Directors has appointed Geraldine Zarbo of American Stock
Transfer & Trust Company, the registrar and transfer agent for the Common
Shares, or her designee, as the Inspector of Elections for the Annual Meeting.
The Inspector of Elections will determine the number of Common Shares
represented in person or by proxy at the Annual Meeting, whether a quorum
exists, the authenticity, validity and effect of proxies and will receive and
count the votes. The election of directors will not be by ballot unless a
shareholder demands election by ballot at the Annual Meeting before the voting
begins.

                                 PROPOSAL NO. 1

                             ELECTION OF DIRECTORS

BOARD OF DIRECTORS

     The Company's Bylaws provide that there shall be no less than five nor more
than nine directors and that the exact number shall be fixed from time to time
by a Resolution of the Board of Directors. The number of directors currently is
fixed at five.

     The Board of Directors is proposing the persons named below for election to
the Board of Directors. Each of the persons identified below will be nominated
for election to serve until the next Annual Meeting of Shareholders and until
their successors shall be elected and qualified. Votes will be cast pursuant to
the enclosed proxy in such a way as to effect the election of each of the
persons named below or as many of them as possible under applicable voting
rules. If a nominee shall be unable or unwilling to accept nomination for
election as a director, it is intended that the proxy holders will vote for the
election of such substitute nominee, if any, as shall be designated by the Board
of Directors. Each of the nominees named below has notified the Board of
Directors that, if elected, he is willing to serve as a Director.

     Set forth below is certain information regarding each of the nominees.

     THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE ELECTION OF THE NOMINEES
NAMED BELOW. PROXIES RETURNED TO THE COMPANY WILL BE VOTED "FOR" THE NOMINEES
NAMED BELOW UNLESS OTHERWISE INSTRUCTED.

NOMINEES

     ERNEST A. BATES, M.D., founder of the Company, has served as Chairman of
the Board of Directors and Chief Executive Officer since the incorporation of
the Company. He is currently a member of the Board of Trustees of The Johns
Hopkins University and the University of Rochester, a member of the Board of
Overseers of the University of California at San Francisco School of Nursing, a
member of the State of California High Speed Rail Authority, and a member of the
Board of Directors of Salzburg Seminar. Dr. Bates is a graduate of The Johns
Hopkins University and the University of Rochester School of Medicine. Dr. Bates
is 65 years old.

     WILLIE R. BARNES has been a director and Corporate Secretary of the Company
since 1984. He has been a partner in the law firm of Musick Peeler & Garrett LLP
since June 1992. He is a graduate of UCLA and received his law degree from the
UCLA Law School. Mr. Barnes was appointed as the Commissioner of Corporations
for the State of California in 1975. He was a director of Franchise Finance
Corporation of America until its acquisition in mid 2001. Mr. Barnes is 70 years
old.

     JOHN F. RUFFLE has been a director of the Company since 1995. He retired in
1993 as Vice-Chairman of the Board and a Director of J.P. Morgan & Co.
Incorporated and Morgan Guaranty Trust Co. of New York. He also is a Director of
Bethlehem Steel Corporation; a member of the Boards of Managers of North Moore
                                        3
<PAGE>

Fund, LLC and JP Morgan Global Emerging Markets Fund, LLC; a Trustee of JPM
Series Trust II; a Director of The Wackenhut Corporation; a Director of
Wackenhut Corrections Corp; and a Trustee of The Johns Hopkins University. He is
a graduate of The Johns Hopkins University, with an MBA in finance from Rutgers
University, and is a Certified Public Accountant. Mr. Ruffle is 65 years old.

     STANLEY S. TROTMAN, JR., has been a director of the Company since 1996. He
retired in 2000 as a Managing Director with the Health Care Group of PaineWebber
Incorporated, an investment banking firm. Mr. Trotman had been with PaineWebber
Incorporated since 1995 following the consolidation of Kidder, Peabody, also an
investment banking firm, with PaineWebber. He had previously co-directed Kidder,
Peabody's Health Care Group since April 1990. Formerly he had been head of the
Health Care Group at Drexel Burnham Lambert, Inc. where he had been employed for
approximately 22 years. He received his undergraduate degree from Yale
University in 1965 and holds an MBA from Columbia Business School in 1967. Mr.
Trotman is 58 years old.

     CHARLES B. WILSON, M.D. has been a director of the Company since 1993. He
also was a director of the Company from March 1984 until March 1989. He has been
a Professor of Neurosurgery at the University of California Medical Center, San
Francisco, since 1968. From 1968 until April 1994, and from March 1996 until
July 1997, Dr. Wilson held the position of Chairman of the University's
Department of Neurosurgery. Since July 2000 Dr. Wilson is a part time employee
of the Company. He also is a Director of The Institute for the Future in Menlo
Park, California. Dr. Wilson is 72 years old.

MEETINGS OF THE BOARD OF DIRECTORS

     The Board of Directors of the Company held four meetings during 2001. All
Directors attended at least 75% of the aggregate number of meetings of both the
Board of Directors and of the Committees of the Board on which such Director
served during the year.

COMMITTEES OF THE BOARD OF DIRECTORS

     The Company has standing Compensation, Stock Option, Nominating and Audit
Committees, each of which is described below. All Directors serve on each
standing Committee, except that Dr. Bates does not serve on the Audit Committee.

     The function of the Compensation Committee is to recommend to the Board of
Directors the compensation of the Company's executive officers. The Compensation
Committee did not meet during 2001. Mr. Trotman is Chair of the Compensation
Committee.

     The purpose of the Stock Option Committee is to administer the Company's
1984 Stock Option Plan, 1995 Stock Option Plan and 2001 Stock Option Plan, and
to determine recipients of awards pursuant to such plans and the terms of such
awards. No member of the Stock Option Committee received a discretionary grant
or award under an option plan of the Company while serving on such committee or
during the year preceding such service. There was one meeting of the Stock
Option Committee during 2001. Mr. Ruffle is Chair of the Stock Option Committee.

     The purpose of the Nominating Committee is to recommend candidates for
election to the Board of Directors. The Nominating Committee did not meet during
2001. Mr. Trotman is Chair of the Nominating Committee. A shareholder who wishes
to nominate a person for Director must provide the nomination in writing to the
Secretary at the Company's principal offices pursuant to the notice provisions
in the By-laws. Such notice must be received not less than 60 nor more than 90
days prior to the Annual Meeting or, if less than 70 days' notice of the date of
such meeting has been given, then within 10 business days following the first
public disclosure of the meeting date or the mailing of the Company's notice.
Any such notice must contain information regarding the nominee and the
proponent. Details concerning the nature of such information are available
without charge from the Company.

     The purpose of the Audit Committee is to review the financial reporting and
internal controls of the Company, to recommend to the Board of Directors the
appointment of independent auditors, and to review

                                        4
<PAGE>

the reports of such auditors. During the year 2001 the Audit Committee held two
meetings and one telephonic meeting. For further information concerning the
Audit Committee, refer to the "Audit Committee Report."

DIRECTOR COMPENSATION

     In 2001, non-employee directors were paid an annual retainer of $20,000,
payable quarterly. In addition, non-employee directors are entitled to receive
an automatic grant of Options from the Company's 1995 Stock Option Plan on the
date of the Company's Annual Shareholder Meeting each year, to acquire up to
4,000 shares annually of the Company's common stock at the market price on the
date of grant, until a Director has options for a total of 12,000 shares in all
Company plans. There were no such grants to non-employee directors during 2001
as each current non-employee director already holds options for a total of
12,000 shares of the Company's stock. All four of the Board meetings held during
2001 were regular meetings that directors attended in person. Non-employee
directors also received reimbursement of expenses incurred in attending
meetings. No payment is made for attendance at meetings by any director who is
an employee of the Company.

     Beginning in 2000, the Company employed Dr. Wilson on a limited part-time
basis to assist in the implementation of its two new businesses, Medleader.com,
Inc. and OR21, Inc. For these services, Dr. Wilson earned $60,000 during 2001 in
addition to his Board of Director fees. The Board determined that this limited
role did not affect his Board compensation.

     Non-employee directors will receive in 2002 a $20,000 annual retainer fee
payable quarterly, and reimbursement of expenses incurred in attending meetings.
Each current non-employee director already holds options for a total of 12,000
shares of the Company's common stock, so no additional automatic grants to such
Directors, as described in the preceding paragraph, are expected to be made
during 2002.

                         CERTAIN ADDITIONAL INFORMATION

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

     The following table sets forth certain information regarding the beneficial
ownership of the Company's Common Shares as of April 5, 2002, of (i) each person
known to the Company to own beneficially 5% or more of the Common Shares, (ii)
each director of the Company, (iii) the chief executive officer and the chief
operating and financial officer named in the Summary Compensation Table, and
(iv) all directors and executive officers as a group.

<Table>
<Caption>
                                                              COMMON SHARES OWNED BENEFICIALLY
                                                              --------------------------------
                                                              AMOUNT AND NATURE
                                                                OF BENEFICIAL      PERCENT OF
NAME AND ADDRESS OF BENEFICIAL OWNER                            OWNERSHIP(2)        CLASS(3)
------------------------------------                          -----------------    -----------
<S>                                                           <C>                  <C>
Ernest A. Bates, M.D.(1)(4).................................      2,039,288            40.8%
Willie R. Barnes(1)(4)......................................         13,000               *
John F. Ruffle(1)...........................................        200,411             5.6%
Stanley S. Trotman, Jr.(1)(4)...............................        142,762             4.0%
Charles B. Wilson, M.D.(1)..................................         12,000               *
Craig K. Tagawa (1)(4)
  Senior Vice President -- Chief Operating and Financial
  Officer...................................................        137,600             3.7%
All Directors & Executive Officers as a Group (6
  people)(4)................................................      2,545,061            49.5%
</Table>

---------------
 *  Less than 1%

(1) The address of each such individual is c/o American Shared Hospital
    Services, Four Embarcadero Center, Suite 3700, San Francisco, California
    94111.

(2) Each person directly or indirectly has sole voting and investment power with
    respect to the shares listed under this column as being owned by such
    person.

                                        5
<PAGE>

(3) Shares that any person or group of persons is entitled to acquire upon the
    exercise of options or warrants within 60 days after April 5, 2002, are
    treated as issued and outstanding for the purpose of computing the percent
    of the class owned by such person or group of persons but not for the
    purpose of computing the percent of the class owned by any other person.

(4) Includes shares underlying options that are currently exercisable or which
    will become exercisable within 60 days following April 5, 2002: Dr. Bates,
    1,395,000 shares; Mr. Barnes, 12,000 shares; Mr. Trotman, 2,667 shares; Mr.
    Tagawa, 125,000 shares; and Directors and Executive Officers as a group,
    1,534,667 shares.

COMPENSATION OF EXECUTIVE OFFICERS

     The following table sets forth the compensation paid by the Company for the
fiscal years ending December 31, 1999, December 31, 2000 and December 31, 2001
paid in those years for services rendered in all capacities during 1999, 2000
and 2001, respectively, to the Chief Executive Officer and each executive
officer other than the Chief Executive Officer who served as an officer at
December 31, 2001 and earned cash compensation of $100,000 or more during 2001.

                           SUMMARY COMPENSATION TABLE

<Table>
<Caption>
                                                                 ANNUAL COMPENSATION
                                                     --------------------------------------------
                                                                                   OTHER ANNUAL
NAME AND PRINCIPAL POSITION                  YEAR    SALARY(1)       BONUS        COMPENSATION(4)
---------------------------                  ----    ---------      --------      ---------------
<S>                                          <C>     <C>            <C>           <C>
Ernest A. Bates, M.D.......................  2001    $432,250       $ 55,770(2)          --
  Chairman of the Board,                     2000    $397,501       $ 60,000(2)          --
  Chief Executive Officer                    1999    $381,297       $300,000(3)          --
Craig K. Tagawa............................  2001    $305,837(5)    $ 30,745(2)          --
  Chief Operating Officer and                2000    $252,214(6)    $ 40,000(2)          --
  Chief Financial Officer                    1999    $231,050(7)    $165,000(3)          --
</Table>

---------------
(1) Each amount under this column includes amounts accrued in 1999, 2000, and
    2001, that would have been paid to such persons in such years, except that
    such amounts were instead deferred pursuant to the Retirement Plan for
    Employees of American Shared Hospital Services, a defined contribution plan
    and ASHS' Flexible Benefit Plan, a defined contribution plan. Both plans are
    available to employees of the Company generally.

(2) The Company's Board of Directors approved year end performance bonuses for
    2000 and 2001 which were accrued in the year indicated and were paid in the
    first quarter of the following year.

(3) Each of these individuals was awarded a special bonus for his role in the
    successful sale of the Company's diagnostic imaging business in 1998. The
    Company's Board of Directors approved these bonuses in February 1999, and
    such bonuses were paid thereafter, for services which were performed during
    1998.

(4) The Company has determined that, with respect to the executive officers
    named in the Summary Compensation Table, the aggregate amount of other
    benefits does not exceed the lesser of $50,000 or 10% of the total annual
    salary and bonus reported in the Summary Compensation Table as paid to such
    executive officer in the relevant year.

(5) Includes sales commissions of approximately $63,000 earned and paid in 2001.

(6) Includes sales commissions of approximately $39,000 earned and paid in 2000.

(7) Includes sales commissions of approximately $44,000 earned and paid in 1999.

                                        6
<PAGE>

LONG TERM COMPENSATION AWARDS

     The "Long Term Compensation Awards" Table has been omitted because no long
term compensation awards were made during the relevant years to the Company's
executive officers named in the Summary Compensation Table.

OPTION GRANTS IN LAST FISCAL YEAR

     The "Option Grants" table has been omitted because no option grants were
made during 2001 to the Company's executive officers named in the summary
compensation table.

LONG-TERM INCENTIVE PLAN AWARDS IN LAST FISCAL YEAR

     The "Long-term Incentive Plan Awards" ("LTIP Awards") table has been
omitted because no LTIP Awards were made during 2001 to the Company's executive
officers named in the Summary Compensation Table.

AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR-END OPTION
VALUES

     The following table sets forth the number of shares acquired on exercise of
stock options and the aggregate gains realized upon exercise of such options
during 2001, by the Company's executive officers named in the Summary
Compensation Table. The following table also sets forth the number of shares
underlying exercisable and unexercisable options held by such executive officers
on December 31, 2001.

                        1984 AND 1995 STOCK OPTION PLANS
                AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
                       AND FISCAL YEAR-END OPTION VALUES

<Table>
<Caption>
                                                            NUMBER OF SECURITIES
                                                                 UNDERLYING                VALUE OF UNEXERCISED
                                                            UNEXERCISED OPTIONS            IN-THE-MONEY OPTIONS
                                SHARES                       AT FISCAL YEAR-END           AT FISCAL YEAR-END(1)
                              ACQUIRED ON   VALUE($)    ----------------------------   ----------------------------
NAME                           EXERCISE     REALIZED    EXERCISABLE/   UNEXERCISABLE   EXERCISABLE/   UNEXERCISABLE
----                          -----------   ---------   ------------   -------------   ------------   -------------
<S>                           <C>           <C>         <C>            <C>             <C>            <C>
Ernest A. Bates, M.D. ......      --           --        1,495,000          --          $4,499,950         --
Craig K. Tagawa.............      --           --          125,000          --          $  146,875         --
</Table>

---------------
(1) This amount is calculated by multiplying the number of Common Shares
    underlying the options at December 31, 2001 by the market price per Common
    Share on such date less the option exercise price.

EMPLOYMENT AGREEMENTS

     The Company had no employment contracts with its directors or executive
officers named in the Summary Compensation Table in 2001.

BOARD OF DIRECTORS REPORT ON EXECUTIVE COMPENSATION

     The following Report of the Board of Directors shall not be deemed
incorporated by reference by any general statement incorporating by reference
this Proxy Statement into any filing under the Securities Act or under the
Exchange Act, except to the extent that the Company specifically incorporates
this information by reference, and shall not otherwise be deemed filed under
such Acts.

     This Report of the Board of Directors describes the Company's method of
compensating its executive officers, and describes the basis on which 2001
compensation was paid to such executive officers, including those named in the
Summary Compensation Table.

     The Board of Directors determined that compensation paid in 2001 by the
Company to its Chief Executive Officer and other executive officers would be
based on policies in effect in recent prior years. As a result, it was
unnecessary for the Compensation Committee to meet, and it did not meet, during
2001.

                                        7
<PAGE>

     The Company's compensation program seeks to establish compensation that is
competitive in both the healthcare industry and among entrepreneurial,
growth-oriented companies in order to attract and retain high quality employees.
Compensation is linked to each employee's level of responsibility and personal
achievements with respect to operational and financial goals established by the
Chief Executive Officer and the Board of Directors. Depending on the individual
officer's area of responsibility, such goals may include new business and
revenue acquisition, operating expense reduction and control, operating
efficiencies, etc. In addition, the compensation system seeks to develop and
encourage employee ownership of the Company's stock through stock options.

     The primary component of executive compensation for the Company in 2001 was
base salary, except in the case of the Chief Operating and Financial Officer
(who also is CEO of the Company's Gamma Knife subsidiary) where sales
commissions were a substantial component of compensation and are included under
"salary" in the table above. Discretionary bonuses may be paid, based on a
formula, if financial and other results of the individual executive's area of
responsibility meet or exceed financial and operational targets established at
the beginning of the fiscal year. In February 2002, the Board approved bonuses
for Ernest A. Bates, M.D. and Craig K. Tagawa for their performance during the
year 2001. These bonuses were paid in February 2002.

     In addition to base compensation, the Company has used grants of stock
options to retain senior executives and to motivate them to improve long-term
stock market performance. The number of options granted in the past was
determined by reference to the level of responsibility of the particular
executive in the Company and such executive's proposed role in the Company's
future operations. In addition, during 1995 the Shareholders approved a grant of
options to acquire 1,495,000 Common Shares at an initial exercise price of $0.01
per share to the Company's Chairman and Chief Executive Officer, in
consideration of his continued service to the Company and his personal guarantee
of $6,500,000 of indebtedness of the Company. The Company's Chairman and Chief
Executive Officer exercised options to acquire 100,000 Common Shares in March
2002.

BOARD OF DIRECTORS

<Table>
<S>                                            <C>
Ernest A. Bates, M.D. Chairman                 Stanley S. Trotman, Jr.
Willie R. Barnes                               Charles B. Wilson, M.D.
John F. Ruffle
</Table>

                 CERTAIN RELATIONSHIPS AND RELATED TRANSLATIONS

     Willie R. Barnes, the Secretary and a director of the Company, is a partner
in the law firm of Musick, Peeler & Garrett LLP. That law firm performed legal
services for the Company in 2001. The management of the Company is of the
opinion that the fees paid to Mr. Barnes' law firm are comparable to those fees
that would have been paid for comparable legal services from a law firm not
affiliated with the Company. Mr. Barnes served during 2001 on the Compensation
Committee, Audit Committee and Nominating Committee of the Board of Directors.

COMPLIANCE WITH SECTION 16(a) UNDER THE SECURITIES EXCHANGE ACT OF 1934

     Reports filed under the Exchange Act and received by the Company on or
after January 1, 2001, indicate that during 2001 directors, officers and 10%
shareholders of the Company filed all required reports within the periods
established by applicable rules.

                                        8
<PAGE>

                PERFORMANCE GRAPH, TOTAL RETURN TO SHAREHOLDERS

     The following graph and table compares cumulative total shareholder return
on the Company's Common Shares ("ASHS total return") (i) with the cumulative
total return of the Standard & Poor's 500 Stock Index ("S&P500") and (ii) with
the Standard & Poors SmallCap 600 Stock Index ("S&P SmallCap600"), in each case
during the five years ended December 31, 2001.



                              [PERFORMANCE GRAPH]

<Table>
<Caption>
                 --------------------------------------------------------------------------
                                         Base
                                        Period
                 Company / Index        Dec 96   Dec 97   Dec 98   Dec 99   Dec 00   Dec 01
                 --------------------------------------------------------------------------
                 <S>                    <C>      <C>      <C>      <C>      <C>      <C>      <C>
                  American Shared
                   Hsptl Serv           100.00   96.58    65.54    234.55   124.17   173.33
                  S&P 500 Index         100.00   133.36   171.48   207.56   188.66   166.24
                  S&P Smallcap 600
                   Index                100.00   125.58   123.95   139.32   155.76   165.94
                 --------------------------------------------------------------------------
</Table>

                                        9
<PAGE>

                             AUDIT COMMITTEE REPORT

     The following Report of the Audit Committee does not constitute soliciting
material and should not be deemed filed or incorporated by reference into any
other filing of the Company under the Securities Act of 1933 or the Securities
Exchange Act of 1934, except to the extent the Company specifically incorporates
the Report by reference therein.

     The Audit Committee of the Board of Directors consists of four directors,
three of whom are "independent" as defined in the listing standards of the
American Stock Exchange. The primary purpose of the Audit Committee is to review
the financial reporting and internal controls of the Company, to recommend to
the Board of Directors the appointment of independent auditors, to review the
reports of such auditors, and to review annually the Audit Committee charter.
During 2001, the Audit Committee held three meetings, one of which was held
telephonically. Mr. Ruffle is Chair of the Audit Committee.

     The Audit Committee reviewed and held discussions with management and the
independent auditors regarding the financial statements of the Company for the
fiscal year ended December 31, 2001. These discussions included the quality of
the Company's internal controls, the audit plans, audit scope and identification
of audit risks. In addition, the Committee assured that the independent auditors
reviewed and discussed with management the interim financial reports prior to
each quarterly earnings announcement.

     The Company's independent auditors provided a formal written statement that
described all relationships between the auditors and the Company with respect to
the auditors' independence as required by Independence Standards Board Standard
No. 1, "Independence Discussions with Audit Committees," and the Audit Committee
satisfied itself as to the auditors independence.

     The Audit Committee discussed with the independent accountants all matters
required to be discussed by Statement on Auditing Standards No. 61, as amended,
"Communication with Audit Committees" and, with and without the presence of
management, reviewed and discussed the results of the independent auditors
examination of the Company's financial statements. Management, being responsible
for the Company's financial statements, represented that the Company's
consolidated financial statements were prepared in accordance with generally
accepted accounting principles. The independent auditors are responsible for the
examination of those statements.

     Based on the Audit committee's discussions with management and the
independent auditors, and the Audit Committee's review as described previously,
The Audit Committee recommended to the Board of Directors that the Company's
audited financial statements be included in its Annual Report on Form 10-K for
the fiscal year ended December 31, 2001, as filed with the Securities and
Exchange Commission.

     Submitted by the Audit Committee of the Board of Directors:

                           John F. Ruffle (chairman)
                                Willie R. Barnes
                            Stanley S. Trotman, Jr.
                            Charles B. Wilson, M.D.

                              INDEPENDENT AUDITORS

     The Company's consolidated financial statements for the years ended
December 31, 2001, 2000 and 1999 have been audited by Moss Adams LLP. The Board
of Directors has appointed Moss Adams LLP to be the Company's independent
auditors for the fiscal year ending December 31, 2002, subject to Shareholder
ratification at the Meeting (see Proposal No. 2).

     Representatives of Moss Adams LLP are expected to be present at the Annual
Meeting to respond to appropriate questions and will be given an opportunity to
make a statement if they so desire.

                                        10
<PAGE>

AUDIT FEES

     The aggregate fees billed by Moss Adams LLP for the audit of the Company's
annual consolidated financial statements for fiscal year 2001 and the review of
the Company's quarterly Form 10-Q during 2001 were $59,750.

FINANCIAL INFORMATION SYSTEMS DESIGN AND IMPLEMENTATION FEES

     There were no fees billed by Moss Adams LLP for financial information
systems design and implementation fees for fiscal 2001.

ALL OTHER FEES

     The Company paid Moss Adams LLP an aggregate of $90,900 for professional
services, other than those described above, provided during fiscal year ended
2001. These fees were primarily for tax return preparation and other tax
services.

                             SHAREHOLDER PROPOSALS

     Under certain circumstances, shareholders are entitled to present proposals
at shareholders' meetings. To be eligible for inclusion in the Proxy Statement
for the Company's next Annual Meeting of Shareholders, a shareholder proposal
must be received at the Company's principal executive offices prior to February
8, 2003. A Shareholder's notice should list each proposal and contain a brief
description of the business to be brought before the meeting; the name and
address of the shareholder proposing such business; the number of shares held by
the shareholder; and any material interest of the shareholder in the business.

                                 ANNUAL REPORT

     The Company's 2001 Annual Report, which includes financial statements, but
which does not constitute a part of the proxy solicitation material, accompanies
this proxy statement.

                                        By Order of the Board of Directors

                                        /s/ WILLIE R. BARNES

                                        Willie R. Barnes
                                        Corporate Secretary

Dated: April 29, 2002
San Francisco, California

                                        11
<PAGE>
                        AMERICAN SHARED HOSPITAL SERVICES

         For the Annual Meeting of Shareholders to be held June 6, 2002

           THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS

THE UNDERSIGNED HEREBY NOMINATE(S), CONSTITUTE(S) AND APPOINT(S) ERNEST A.
BATES, M.D. AND CRAIG K. TAGAWA, AND EACH OF THEM, ATTORNEYS, AGENTS, AND
PROXIES OF THE UNDERSIGNED, WITH FULL POWERS OF SUBSTITUTION TO EACH, TO ATTEND
AND TO ACT AS PROXY OR PROXIES OF THE UNDERSIGNED AT THE ANNUAL MEETING OF
SHAREHOLDERS OF AMERICAN SHARED HOSPITAL SERVICES TO BE HELD ON JUNE 6, 2002 AT
3:00 PM PACIFIC TIME AT THE RITZ CARLTON HOTEL, 600 STOCKTON STREET, SAN
FRANCISCO, CALIFORNIA, OR ANY ADJOURNMENTS THEREOF, AND TO VOTE AS SPECIFIED
HEREIN THE NUMBER OF SHARES THAT THE UNDERSIGNED, IF PERSONALLY PRESENT, WOULD
BE ENTITLED TO VOTE.

THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE ELECTION OF THE FIVE PERSONS
NOMINATED FOR ELECTION TO THE BOARD OF DIRECTORS, AND "FOR" THE RATIFICATION OF
MOSS ADAMS LLP AS THE COMPANY'S INDEPENDENT ACCOUNTANTS FOR 2002. YOU ARE
ENCOURAGED TO SPECIFY YOUR CHOICES BY MARKING THE APPROPRIATE BOXES. THIS PROXY
WHEN PROPERLY EXECUTED WILL BE VOTED AS DIRECTED. IF NO DIRECTION IS MADE, IT
WILL BE VOTED, SUBJECT TO THE PROXYHOLDER'S DISCRETIONARY AUTHORITY TO CUMULATE
VOTES, "FOR" THE ELECTION OF THE PERSONS NOMINATED ON THE REVERSE SIDE, AND WILL
HAVE THE EFFECT OF WITHHOLDING DISCRETIONARY AUTHORITY TO CUMULATE VOTES AND
"FOR" THE RATIFICATION OF INDEPENDENT ACCOUNTANTS. THE BOARD OF DIRECTORS IS NOT
AWARE OF ANY OTHER MATTERS THAT WILL COME BEFORE THE ANNUAL MEETING, OTHER THAN
THOSE DESCRIBED IN THIS PROXY. HOWEVER, IF SUCH MATTERS ARE PRESENTED, THE NAMED
PROXIES WILL, IN THE ABSENCE OF INSTRUCTIONS TO THE CONTRARY, VOTE SUCH PROXIES
IN ACCORDANCE WITH THE JUDGMENT OF SUCH NAMED PROXIES WITH RESPECT TO ANY SUCH
OTHER MATTER PROPERLY COMING BEFORE THE MEETING. THIS PROXY MAY BE REVOKED PRIOR
TO ITS EXERCISE BY FILING WITH THE SECRETARY OF THE COMPANY AN INSTRUMENT IN
WRITING REVOKING THIS PROXY OR A DULY EXECUTED PROXY BEARING A LATER DATE. THIS
PROXY ALSO MAY BE REVOKED BY ATTENDANCE AT THE MEETING AND ELECTION TO VOTE IN
PERSON.


                 (continued, and to be signed on the other side)
<PAGE>
 [X]    PLEASE MARK YOUR VOTE AS IN THIS EXAMPLE


        This proxy when properly executed will be voted in the manner directed
herein and in the discretion of the proxy holders and all other matters coming
before the meeting. If no direction is made, this proxy will be voted FOR the
election of directors recommended herein, and FOR Proposal No. 2.

        The Board of Directors recommends a vote FOR election of the directors
nominated herein and FOR the ratification of independent accountants.


1.      ELECTION OF DIRECTORS. To elect five of the persons named below to the
        Board of Directors to serve until the 2003 Annual Meeting of
        Shareholders and until their successors are elected and have qualified.

        [ ] FOR all nominees (except as indicated to the contrary below).

        [ ] WITHHOLD AUTHORITY to vote for all nominees.

        (Instruction: To withhold authority for any individual nominee(s),
         write that nominee's name(s) in the space below.)

        NOMINEES:  Ernest A. Bates, M.D.
                   Willie R. Barnes
                   John F. Ruffle
                   Stanley S. Trotman, Jr.
                   Charles B. Wilson, M.D.

2.      RATIFICATION OF INDEPENDENT ACCOUNTANTS. To ratify the appointment of
        Moss Adams LLP as the Company's independent accountants for the year
        ended December 31, 2002.

        [  ] FOR   [  ]  AGAINST    [  ]  ABSTAIN

        The undersigned hereby ratifies and confirms all that said attorneys and
proxies, or any of them, or their substitutes, shall lawfully do or cause to be
done by virtue hereof, and hereby revokes any and all proxies heretofore given
by the undersigned to vote at the Meeting. The undersigned acknowledges receipt
of the Notice of the Annual Meeting and the Proxy Statement accompanying such
Notice.

PLEASE MARK, DATE AND SIGN AS YOUR NAME APPEARS ABOVE AND RETURN IN THE ENCLOSED
ENVELOPE.

I plan to attend the meeting in person [  ]

<PAGE>
Signature                             Date
         ---------------------------      --------
Signature                             Date
         --------------------------
         Signature, if held jointly


NOTE: Please date this proxy and sign as your name(s) appear(s) on this
document. Joint owners should each sign personally. Corporate proxies should be
signed by an authorized officer. Executors, administrators, trustees, etc.
should give their full titles.

</TEXT>
</DOCUMENT>
