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AMS Health Sciences falls short of AMEX standards
[January 19, 2006]

AMS Health Sciences falls short of AMEX standards


(Daily Oklahoman, The (KRT) Via Thomson Dialog NewsEdge) Jan. 19--Click on the "Executive Leadership" link on the Web site of Oklahoma City's AMS Health Sciences Inc. and the message that appears is "This page is currently being updated. Please check back. Thank you."



That about sums up the current situation at the multilevel marketing company, which has changed its name, twice fired its president and revamped its product line in recent months.

Now the American Stock Exchange has notified AMS that its stock is in danger of being removed from the exchange if the company's financial situation doesn't improve within 18 months.


AMEX last week notified AMS that the company fell short of listing requirements by failing to maintain shareholders' equity of $4 million and suffering net losses in three of its last four fiscal years. To maintain its listing, the company must submit a plan to the exchange by Feb. 12 showing what action it has taken or will take to bring it into compliance.

If the plan is accepted, the company will retain its listing and will have up to 18 months to get back in compliance. During that period, the exchange will periodically review the company's progress.

AMS Chairman John Hail, who has acknowledged the company's problems while maintaining optimism about the business' prospects, said AMS will be back in compliance shortly.

"Without any question," Hail said Wednesday. "It won't take darn near that long. It's only $300,000."

Sept. 30, AMS' shareholder equity -- the amount of company assets held by shareholders -- was $3.7 million. Hail said it has been growing recently.

Hail maintains that previously instituted cost-cutting, as well as some new products and a new marketing plan, will return the company to profitability.

Meanwhile, Hail is still waiting to hear from former AMS President Steven Kochen, who Dec. 31 was given three weeks to decide if he wanted to resign from the company or be terminated.

"I have not heard a word," Hail said. "We're going to make a decision how we're going to handle that, you know, he didn't choose to resign so we're going to have to terminate him. He'll be terminated either way. He's no longer president."

Hail earlier praised Kochen's belt-tightening acumen but said the former president failed to provide the marketing skills needed to head AMS, which sells more than 60 nutritional supplements, diet aids and skin care products through a network of independent salespeople.

Hired in August, Kochen was to be paid $150,000 in his first year with the company. His severance is one month's salary, according to regulatory filings.

In the past month, three company directors, including one who also served as chief financial officer, have resigned. The board of directors has dwindled from seven members to three, including Hail. The company, which had 65 full-time and 10 part-time employees at the beginning of 2005, now employs less than half that number.

AMS shares have plummeted over the past year from more than $5 a share to less than $1. Wednesday, the stock dipped as low as 60 cents a share before closing at 70 cents.

Removal from the American Stock Exchange would severely limit the company's exposure, shuffling it to the realm of the over-the-counter market that is home to thousands of highly speculative penny stocks.

Bob Rader, senior vice president of Capital West Securities in Oklahoma City, said the stock has fallen to a level that the American Stock Exchange -- and investors -- are demanding that the company show some improvement. "The American does not want to delist this company," Rader said. "That's where they give them plenty of time to comply. They say give us the plan, then the ball's in their (AMS') court."

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