UNITED
STATES SECURITIES AND EXCHANGE COMMISSION


Washington,
D.C. 20549





FORM
10-Q


(Mark
One)





x
            Quarterly
      Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of
      1934.





For
the quarterly period ended September 30, 2009


or





o
            Transition
      Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of
      1934.





For
the transition period from ______to______.





Commission file number
000-50354





AMERICAN
SURGICAL HOLDINGS, INC.


(Exact
name of registrant as specified in its charter)




Delaware
              
              98-0403551(State
      or other jurisdiction of
              
              (I.R.S.
      Employer Identification No.)incorporation
      or organization)10039 Bissonnet, Suite
      #250
                Houston,
      Texas
              
              77036-7852(Address
      of principal executive offices)
              
              (Zip
      Code)


(713)
779-9800


(Registrants
telephone number, including area code)





(Former
name, former address and former fiscal year, if changed since last
report)





Check
whether the issuer (1) has filed all reports required to be filed by Section 13
or 15(d) of the Exchange Act during the preceding 12 months (or for such shorter
period that the issuer was required to file such reports), and (2)has been
subject to such filing requirements for the past 90 days. Yes x  No o





Indicate
by check mark whether the registrant has submitted electronically and posted on
its corporate Web site, if any, every Interactive Data File required to be
submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this
chapter) during the preceding 12 months (or for such shorter period that the
registrant was required to submit and post such files).


Yes  ̈ No  ̈





Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer or a smaller reporting company filer.
 See definition of accelerated filer and large accelerated filer in Rule
12b-2 of the Exchange Act (Check one):





Large
Accelerated Filer o     Accelerated
Filer o     Non-Accelerated
Filer o     Smaller
Reporting Company x





Indicate
by check mark whether the registrant is a shell company as defined in Rule 12b-2
of the Exchange Act. Yes o  No x





State the number of shares outstanding
of each of the issuer's classes of common equity, as of November 10,
2009:9,746,423 shares of
common stock.











AMERICAN
SURGICAL HOLDINGS, INC.


FORM
10Q


September
30, 2009





INDEX





PART
I-- FINANCIAL INFORMATION





Item
      1.
            Financial
      StatementsItem
      2.
            Management’s
      Discussion and Analysis of Financial ConditionItem
      3
            Quantitative
      and Qualitative Disclosures About Market RiskItem
      4
            Control
      and Procedures





PART
II-- OTHER INFORMATION





Item
      1.
            Legal
      ProceedingsItem
      1A.
            Risk
      FactorsItem
      2.
            Unregistered
      Sales of Equity Securities and Use of ProceedsItem
      3.
            Defaults
      Upon Senior SecuritiesItem
      4.
            Submission
      of Matters to a Vote of Security HoldersItem
      5.
            Other
      InformationItem
      6.
            Exhibits
      and Reports on Form 8-K





SIGNATURE











Item
1. Financial Information





AMERICAN
SURGICAL HOLDINGS, INC. AND SUBSIDIARIES


(F/K/A
ASAH Corp.)


CONDENSED
CONSOLIDATED FINANCIAL STATEMENTS


AS
OF SEPTEMBER 30, 2009


(UNAUDITED)








CONTENTS








PAGE
            F-1
            CONDENSED
      CONSOLIDATED BALANCE SHEETS AS OF SEPTEMBER 30, 2009 (UNAUDITED) AND
      DECEMBER 31, 2008PAGE
            F-2
            CONDENSED
      CONSOLIDATED STATEMENTS OF OPERATIONS FOR THE THREE AND NINE MONTHS ENDED
      SEPTEMBER 30, 2009 (UNAUDITED) AND 2008 (UNAUDITED)PAGE
            F-3
            CONDENSED
      CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS’
      EQUITY  (UNAUDITED)PAGE
            F-4
      – F-5
            CONDENSED
      CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE NINE MONTHS ENDED SEPTEMBER
      30, 2009 (UNAUDITED) AND 2008 (UNAUDITED)PAGE
            F-6 –F-14
            NOTES
      TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
    (UNAUDITED)













AMERICAN
      SURGICAL HOLDINGS, INC. AND SUBSIDIARIES(formerly
      ASAH Corp.)CONDENSED
      CONSOLIDATED BALANCE SHEETSAS
      OF SEPTEMBER 30, 2009 AND DECEMBER 31, 2008SEPTEMBER
      30,
              
              
              DECEMBER
      31,2009
              
              
              2008(UNAUDITED)ASSETSCURRENT
      ASSETSCash
      and cash equivalents
              
              $
              2,727,880
              
              
              $
              431,731Restricted
      cash
              
              
              -
              
              
              
              373,653Accounts
      receivable, net
              
              
              3,510,229
              
              
              
              3,443,471Advances
      to employees
              
              
              35,415
              
              
              
              13,100Prepaid
      expenses and other current assets
              
              
              30,411
              
              
              
              4,708TOTAL
      CURRENT ASSETS
              
              
              6,303,935
              
              
              
              4,266,663PROPERTY
      AND EQUIPMENT, NET
              
              
              39,477
              
              
              
              55,697HOSPITAL
      CONTRACT COSTS & NON-COMPETE, NET
              
              
              25,167
              
              
              
              -TOTAL
      ASSETS
              
              $
              6,368,579
              
              
              $
              4,322,360LIABILITIES AND STOCKHOLDERS'
      EQUITYCURRENT
      LIABILITIESAccounts
      payable and accrued expenses
              
              $
              128,491
              
              
              $
              186,059Accrued
      income tax
              
              
              245,514
              
              
              
              31,234Accrued
      salaries, bonuses & payroll taxes
              
              
              1,221,356
              
              
              
              483,615Note
      payable, related party
              
              
              -
              
              
              
              150,000Convertible
      Notes payable, net of unamortized discount of $0 and
    $767,474
              
              
              -
              
              
              
              2,583,507TOTAL
      CURRENT LIABILITIES
              
              
              1,595,361
              
              
              
              3,434,415STOCKHOLDERS'
      EQUITYPreferred
      stock, $0.001 par value, 10,000,000 shares authorized,
      none issued and outstanding
              
              
              -
              
              
              
              -Common
      stock, $0.001 par value, 100,000,000 shares authorized,
      9,609,012 and 8,425,484
                shares
      issued and outstanding
              
              
              9,609
              
              
              
              8,425Additional
      paid-in capital
              
              
              3,595,050
              
              
              
              3,295,226Deferred
      compensation
              
              
              (56,250
              )
              
              
              (93,750
              )Retained
      earnings (Accumulated deficit)
              
              
              1,224,809
              
              
              
              (2,321,956
              )TOTAL
      STOCKHOLDERS' EQUITY
              
              
              4,773,218
              
              
              
              887,945TOTAL
      LIABILITIES AND STOCKHOLDERS' EQUITY
              
              $
              6,368,579
              
              
              $
              4,322,360




See
accompanying notes to condensed consolidated financial statements.
  F-1




AMERICAN SURGICAL HOLDINGS, INC. AND
      SUBSIDIARIES(formerly
      ASAH Corp.)CONDENSED
      CONSOLIDATED STATEMENTS OF OPERATIONSFOR
      THREE AND NINE MONTHS ENDING SEPTEMBER 30, 2009(UNAUDITED)Three
      Months Ended
              
              
              Nine
      Months EndedSep.
      30,
              
              
              Sep.
      30,
              
              
              Sep.
      30,
              
              
              Sep.
      30,2009
              
              
              2008
              
              
              2009
              
              
              2008Revenues,
      net
              
              $
              6,724,758
              
              
              $
              3,072,479
              
              
              $
              16,702,850
              
              
              $
              7,678,077Cost
      of revenues
              
              
              2,198,857
              
              
              
              1,810,510
              
              
              
              6,115,198
              
              
              
              5,302,845GROSS
      PROFIT
              
              
              4,525,901
              
              
              
              1,261,969
              
              
              
              10,587,652
              
              
              
              2,375,232OPERATING
      EXPENSESGeneral
      and Administration
              
              
              317,829
              
              
              
              291,429
              
              
              
              1,496,391
              
              
              
              1,090,429Salaries
              
              
              1,172,475
              
              
              
              446,890
              
              
              
              3,186,009
              
              
              
              1,680,924Rent
              
              
              23,699
              
              
              
              27,291
              
              
              
              68,981
              
              
              
              72,867TOTAL
      OPERATING EXPENSES
              
              
              1,514,003
              
              
              
              765,610
              
              
              
              4,751,381
              
              
              
              2,844,220NET
      INCOME ( LOSS) FROM OPERATIONS
              
              
              3,011,898
              
              
              
              496,359
              
              
              
              5,836,271
              
              
              
              (468,988
              )Other
      income (expense)Interest
      expense
              
              
              -
              
              
              
              (160,331
              )
              
              
              (280,583
              )
              
              
              (1,451,766
              )Interest
      income
              
              
              3,306
              
              
              
              709
              
              
              
              5,357
              
              
              
              5,080TOTAL
      OTHER INCOME (EXPENSE)
              
              
              3,306
              
              
              
              (159,622
              )
              
              
              (275,226
              )
              
              
              (1,446,686
              )INCOME
      (LOSS) FROM OPERATIONS
              
              
              3,015,204
              
              
              
              336,737
              
              
              
              5,561,045
              
              
              
              (1,915,674
              )(Provision
      for) benefit from income taxes
              
              
              (1,052,734
              )
              
              
              -
              
              
              
              (2,014,280
              )
              
              
              79,042NET
      INCOME (LOSS)
              
              $
              1,962,470
              
              
              $
              336,737
              
              
              $
              3,546,765
              
              
              $
              (1,836,632
              )Net
      income (loss) per share basic
              
              $
              0.23
              
              
              $
              0.04
              
              
              $
              0.42
              
              
              $
              (0.22
              )Net
      income (loss) per share diluted
              
              $
              0.17
              
              
              $
              0.04
              
              
              $
              0.40
              
              
              $
              (0.22
              )Weighted
      average number of sharesOutstanding
      during the period - basic
              
              
              8,537,261
              
              
              
              8,425,484
              
              
              
              8,507,841
              
              
              
              8,425,484Outstanding
      during the period - diluted
              
              
              11,275,979
              
              
              
              8,425,484
              
              
              
              8,938,964
              
              
              
              8,425,484





See
accompanying notes to condensed consolidated financial statements




F-2









AMERICAN SURGICAL HOLDINGS, INC.(formerly
      ASAH Corp.)CONDENSED
      CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITYFOR
      THE PERIOD ENDING SEPTEMBER 30, 2009(UNAUDITED)




RetainedAdditional
              
              
              
              
              
              Earnings/
              
              
              TotalPreferred
      Stock
              
              
              Common
      Stock
              
              
              Paid-in
              
              
              Deferred
              
              
              (Accumulated
              
              
              Stockholders'Shares
              
              
              Amount
              
              
              Shares
              
              
              Amount
              
              
              Capital
              
              
              Compensation
              
              
              Deficit)
              
              
              EquityBalances,
      December 31, 2008
              
              
              -
              
              
              $
              -
              
              
              
              8,425,484
              
              
              $
              8,425
              
              
              $
              3,295,226
              
              
              $
              (93,750
              )
              
              $
              (2,321,956
              )
              
              $
              887,945Common
      Stock issued in acquisition
              
              
              
              
              
              
              -
              
              
              
              100,000
              
              
              
              100
              
              
              
              19,900
              
              
              
              -
              
              
              
              -
              
              
              
              20,000Deferred
      compensation
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              37,500
              
              
              
              -
              
              
              
              37,500Options
      issued to officers
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              162,880
              
              
              
              -
              
              
              
              -
              
              
              
              162,880Options
      issued to employees
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              10,471
              
              
              
              -
              
              
              
              -
              
              
              
              10,471Options
      issued to directors
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              17,024
              
              
              
              -
              
              
              
              -
              
              
              
              17,024Stock
      issued for options
              
              
              -
              
              
              
              -
              
              
              
              886,028
              
              
              
              886
              
              
              
              69,996
              
              
              
              -
              
              
              
              -
              
              
              
              70,882Stock
      issued for warrants
              
              
              -
              
              
              
              -
              
              
              
              197,500
              
              
              
              198
              
              
              
              19,553
              
              
              
              -
              
              
              
              -
              
              
              
              19,751Net
      Income
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              3,546,765
              
              
              
              3,546,765Balances,
      September 30, 2009
              
              
              -
              
              
              $
              -
              
              
              
              9,609,012
              
              
              $
              9,609
              
              
              $
              3,595,050
              
              
              $
              (56,250
              )
              
              $
              1,224,809
              
              
              $
              4,773,218




See
accompanying notes to condensed consolidated financial statements.


F-3




AMERICAN SURGICAL HOLDINGS, INC. AND
      SUBSIDIARIES(formerly
      ASAH Corp.)CONDENSED
      CONSOLIDATED STATEMENTS OF CASH FLOWSFOR
      NINE MONTHS ENDING SEPTEMBER 30, 2009(UNAUDITED)SEP.
      30,
                
                
                SEP.
      30,2009
                
                
                2008CASH
      FLOWS FROM OPERATING ACTIVITIES:Net
      (loss) income
                
                $
                3,546,765
                
                
                $
                (1,836,632
                )Adjustments
      to reconcile net (loss) income to net cash(used
      in) provided by operating activities:Depreciation
      and amortization
                
                
                61,054
                
                
                
                30,116Provision
      for uncollectible accounts
                
                
                (19,000
                )
                
                
                -Amortization
      of deferred financing costs
                
                
                -
                
                
                
                322,521Amortization
      of discount of convertible notes payable
                
                
                131,493
                
                
                
                571,435Deferred
      compensation
                
                
                37,500
                
                
                
                37,500Options
      issued for services
                
                
                10,471
                
                
                
                20,214Options
      issued to officers
                
                
                162,880
                
                
                
                58,655Options
      issued to directors
                
                
                17,024
                
                
                
                10,602Value
      of warrants issued to note holders
                
                
                -
                
                
                
                245,150Changes
      in operating assets and liabilities:(Increase)Decrease
      in accounts receivable, net
                
                
                (47,758
                )
                
                
                (895,034
                )(Increase)
      Decrease in advances to employees
                
                
                (22,315
                )
                
                
                (4,005
                )(Increase)
      Decrease in prepaid expenses
                
                
                (25,703
                )
                
                
                12,889(Increase)
      Decrease in FIT receivable
                
                
                -
                
                
                
                575,408Increase
      (Decrease) in accounts payable and accrued expenses
                
                
                (57,568
                )
                
                
                (25,770
                )Increase
      (Decrease) in accrued salaries & payroll taxes
                
                
                737,741
                
                
                
                280,521Increase
      (Decrease) in accrued taxes
                
                
                214,280
                
                
                
                (95,471
                )Net
      cash (used in) provided  by operating activities
                
                
                4,746,863
                
                
                
                (691,901
                )CASH
      FLOWS FROM INVESTING ACTIVITIES:(Increase)
      Decrease in restricted cash
                
                
                373,653
                
                
                
                (154,120
                )Purchase
      of hospital contracts & non-compete
                
                
                (50,000
                )
                
                
                -Purchase
      of property and equipment
                
                
                -
                
                
                
                (3,941
                )Net
      cash provided by investing activities
                
                
                323,653
                
                
                
                (158,061
                )CASH
      FLOWS FROM FINANCING ACTIVITIES:Repayment
      of note payable from related party
                
                
                (150,000
                )
                
                
                150,000Issuance
      of common stock for options & warrants
                
                
                90,633
                
                
                
                -Repayment
      of convertible notes payable
                
                
                (2,715,000
                )
                
                
                -Net
      Cash used in financing activities
                
                
                (2,774,367
                )
                
                
                150,000NET
      INCREASE (DECREASE) IN CASH
                
                
                2,296,149
                
                
                
                (699,962
                )CASH
      AND CASH EQUIVALENTS AT BEGINNINGOF
      PERIOD
                
                
                431,731
                
                
                
                1,145,359CASH
      AND CASH EQUIVALENTS AT END OF PERIOD
                
                $
                2,727,880
                
                
                $
                445,397




See
accompanying notes to condensed consolidated financial statements.


F-4






AMERICAN
      SURGICAL HOLDINGS, INC. AND SUBSIDIARIES(formerly
      ASAH Corp.)CONDENSED
      CONSOLIDATED STATEMENTS OF CASH FLOWSFOR
      NINE MONTHS ENDING SEPTEMBER 30, 2009(UNAUDITED)




NON-CASH
      INVESTING AND FINANCING ACTIVITIES:Cash
      paid for income taxes
              
              $
              1,800,000
              
              
              $
              16,427Cash
      paid for interest expense
              
              $
              226,053
              
              
              $
              423,716SUPLEMENTAL
      NON-CASH DISCLOSUREStock
      issued in acquisition
              
              $
              20,000
              
              
              $
              -




See
accompanying notes to condensed consolidated financial statements.
  F-5




AMERICAN
SURGICAL HOLDINGS, INC. AND SUBSIDIARIES
 (F/K/A
ASAH Corp.)
 NOTES
TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
 AS OF SEPTEMBER 30,
2009
 (UNAUDITED)
 
 NOTE 1 - BASIS OF
PRESENTATION
 
 The
accompanying consolidated, condensed unaudited financial statements are
presented in accordance with generally accepted accounting principles for
interim financial information and the instructions to Form 10-Q under the rules
and regulations of the Securities and Exchange Commission. Accordingly, they do
not include all of the information and footnotes required by generally accepted
accounting principles for complete financial statements. In the opinion of
management, all adjustments (consisting only of normal occurring accruals)
considered necessary in order to make the financial statements not misleading,
have been included. The financial statements are presented on the accrual
basis.
 
 These
financial statements should be read in conjunction with the Company’s audited
financial statements and the accompanying notes included in the Company’s Form
10-K for the year ended December 31, 2008, filed with the SEC. The results of
operations for the three and nine month periods ended September 30, 2009, are
not necessarily indicative of the results to be expected for any subsequent
quarter or for the entire fiscal year.
 
 Organization
 
 Through
our wholly owned subsidiary, ASA, Inc. we provide professional surgical
assistant services to patients, surgeons, and healthcare institutions. Our high
quality services results in cost savings for patients, insurance carriers,
hospitals, surgeons, and healthcare institutions without compromising the
quality of patient care. We are certified by The Joint Commission, (Formerly
Joint Commission on Accreditation of Healthcare Organizations
(JCAHO).
 
 Surgical
assistants are highly skilled, fully trained professionals credentialed through
an extensive process similar to that utilized to evaluate physicians. These
assistants are an integral part of the surgical team and they provide their
services to surgeons and their patients. These services include, but are not
limited to; identification of anatomical landmarks, securing blood vessels,
recognizing pathological situations and providing and securing adequate, safe
and proper assistance in exposure of the operative field, closure of the
surgical wound, and the application of casts and dressings. They also perform
other duties within the scope of their professional license as instructed or
delegated by the operating surgeon. ASA surgical assistants are trained in
general surgery, obstetrics, gynecology, orthopedic surgery, plastic surgery,
urology, cardiovascular surgery, neurosurgery and other surgical disciplines.
ASA’s recruiting strategies are designed to attract and retain surgical
assistant professionals from both domestic and international
sources.
 
 We market
our services to hospitals, surgeons and healthcare facilities. Presently, we
provide service in Houston, San Antonio and Corpus Christi, Texas, Lawton,
Oklahoma and Suffolk, Virginia. We plan to extend our services to other
healthcare facilities in Texas and ultimately, we plan to offer our services
throughout the country.
 
 Our
business model is designed to accommodate various modalities to suit our
licensed and/or certified professionals to work either as full time salaried
employees, hourly employees or independent contractors. Currently, we have a
total of eighty three (83) surgical assistants, of which sixty eight (68) are
full or part time employees and fifteen (15) are independent contractors. We
also have twenty (20) full time administrative and billing
employees.
 
 Basis
of Financial Statement Preparation
 
 These
unaudited condensed consolidated financial statements of American Surgical
Holdings, Inc., and its subsidiaries should be read in the context of the
consolidated financial statements and notes thereto filed with the Securities
and Exchange Commission in the Company’s  2008 Annual Report on Form
10-K.  In the opinion of the Corporation, the information furnished herein
reflects all known accruals and adjustments necessary for a fair statement of
the results for the periods reported herein.  All such adjustments are of a
normal recurring nature. Intercompany transactions and balances have been
eliminated.
  Cash
and cash equivalents
 
 The
Company considers all highly liquid investments with an original maturity at
acquisition of three months or less to be cash equivalents.
 
 
 F-6
 
   AMERICAN
SURGICAL HOLDINGS, INC. AND SUBSIDIARIES
 (F/K/A
ASAH Corp.)
 NOTES
TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
 AS OF SEPTEMBER 30,
2009
 (UNAUDITED)
 
 
 Use
of estimates
 
 The
preparation of financial statements in conformity with U.S. GAAP requires
management to make estimates and assumptions that affect the reported amounts of
assets and liabilities and the disclosure of contingent assets and liabilities
at the date of the financial statements and the reported amounts of revenues and
expenses during the reporting period. Actual results could differ from those
estimates.
 
 Significant
estimates include revenue recognition, the allowance for doubtful accounts, and
share-based compensation. These estimates have the potential to have a
significant impact on our financial statements, either because of the
significance of the financial statement item to which they relate, or because
they require judgment and estimation due to the uncertainty involved in
measuring, at a specific point in time, events which are continuous in
nature.
 
 Income
taxes
 
 The
Company records deferred taxes in accordance with FASB Accounting Standards
Codification No. 740, Income
Taxes. The statement requires recognition of deferred tax assets and
liabilities for temporary differences between the tax bases of assets and
liabilities and the amounts at which they are carried in the financial
statements, based upon the enacted tax rates in effect for the year in which the
differences are expected to reverse. A valuation allowance is established when
necessary to reduce deferred tax assets to the amount expected to be
realized.
 
 Stock-based
compensation
 
 The
Company accounts for its stock-based compensation under the provisions of FASB
Accounting Standards Codification No. 718, Compensation – Stock
Compensation. Under FASB Accounting Standards Codification No 718, the
Company is permitted to record expenses for stock options and other employee
compensation plans based on their fair value at the date of grant. Any such
compensation cost is charged to expense on a straight-line basis over the
periods the options vest. If the options had cashless exercise provisions, the
Company utilizes variable accounting.
 
 Common
stock, stock options and common stock warrants issued to other than employees or
directors are recorded on the basis of their fair value, as required by FASB
Accounting Standards Codification No. 718, which is measured as of the date
required by FASB Accounting Standards Codification No. 505, Equity Based Payments to
Non-Employees. In accordance with FASB Accounting Standards Codification
No. 505, the stock options or common stock warrants are valued using the
Black-Scholes model on the basis of the market price of the underlying common
stock on the valuation date, which for options and warrants related to contracts
that have substantial disincentives to non-performance is the date of the
contract, and for all other contracts is the vesting date. Expense related to
the options and warrants is recognized on a straight-line basis over the shorter
of the period over which services are to be received or the vesting period.
Where expense must be recognized prior to a valuation date, the expense is
computed under the Black-Scholes model on the basis of the market price of the
underlying common stock at the end of the period, and any subsequent changes in
the market price of the underlying common stock up through the valuation date is
reflected in the expense recorded in the subsequent period in which that change
occurs.
 
 Expected
dividend yield was considered to be $0 in the option pricing formula since the
Company does not pay dividends and has no current plans to do so in the future.
Expected volatility is based on the Company’s historical experience. The
forfeiture rate was considered to be none insofar as the historical experience
of the Company is very limited. As required by FASB Accounting Standards
Codification No. 718, the Company will adjust the estimated forfeiture rate
based upon actual experience.
 
 The
Company recognized a fair market value of $190,375for stock
options earned for the nine months ended September 30, 2009.
  
 F-7
  AMERICAN
SURGICAL HOLDINGS, INC. AND SUBSIDIARIES
 (F/K/A
ASAH Corp.)
 NOTES
TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
 OF SEPTEMBER 30,
2009
 (UNAUDITED)
 
 
 Basic
and Diluted Net Income (Loss) Per Share
 
 The
Company computes net income (loss) per share in accordance with FASB Accounting
Standards Codification No. 260, Earnings Per Share. FASB
Accounting Standards Codification No 260 requires presentation of both basic and
diluted earnings per share (EPS) on the face of the income statement. Basic EPS
is computed by dividing net income (loss) available to common shareholders
(numerator) by the weighted average number of shares outstanding (denominator)
during the period. Diluted EPS gives effect to all dilutive potential common
shares outstanding during the period using the treasury stock method and
convertible preferred stock using the if-converted method. In computing diluted
EPS, the average stock price for the period is used in determining the number of
shares assumed to be purchased from the exercise of stock options or warrants.
Diluted EPS excludes all dilutive potential shares if their effect is anti
dilutive. The Company’s outstanding stock options were 3,618,972 and warrants
were 3,060,500 on September 30, 2009. 1,463,356 options and 3,060,000 warrants
were excluded from the computation of diluted earnings per share on September
30, 2009 since their effect remains anti-dilutive. The Company’s outstanding
stock options and warrants of 4,541,000 on September 30, 2008 were excluded from
the computation of diluted earnings per share since their effect remains
anti-dilutive.
 
 
 F-8
 
  AMERICAN
SURGICAL HOLDINGS, INC. AND SUBSIDIARIES
 (F/K/A
ASAH Corp.)
 NOTES
TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
 OF SEPTEMBER 30,
2009
 (UNAUDITED
 The
following table sets forth the computation of basic earnings per
share
   For
      the three months ended
                
                For
      the nine months endedSeptember
      30,
                
                September
      30,2009
                
                2008
                
                2009
                
                2008Net
      income (loss) for the period
                
                $
                1,962,470
                
                
                $
                336,737
                
                
                $
                3,546,765
                
                
                $
                (1,836,632
                )Weighted
      average number of sharesoutstanding
                
                
                8,537,261
                
                
                
                8,425,484
                
                
                
                8,507,841
                
                
                
                8,425,484Basic
      earnings per share
                
                $
                0.23
                
                
                $
                0.04
                
                
                $
                0.42
                
                
                $
                (0.22
                )
  The
following table sets forth the computation of diluted earnings per
share
  For
      the three months ended
                  
                  
                  For
      the nine months endedSeptember
      30,
                  
                  
                  September
      30,2009
                  
                  
                  2008
                  
                  
                  2009
                  
                  
                  2008Net
      income (loss) for the period
                  
                  $
                  1,962,470
                  
                  
                  $
                  336,737
                  
                  
                  $
                  3,546,765
                  
                  
                  $
                  (1,836,632
                  )Adjusted
      net income (loss)
                  
                  $
                  1,962,470
                  
                  
                  $
                  336,737
                  
                  
                  $
                  3,546,765
                  
                  
                  $
                  (1,836,632
                  )Weighted
      average number of sharesoutstanding
                  
                  
                  8,537,261
                  
                  
                  
                  8,425,484
                  
                  
                  
                  8,507,841
                  
                  
                  
                  8,425,484Diluted
      warrants and options
                  
                  
                  2,738,718
                  
                  
                  
                  -
                  
                  
                  
                  431,123
                  
                  
                  
                  -Weighted
      average number of commonand
      common equivalent shares
                  
                  
                  11,275,979
                  
                  
                  
                  8,425,484
                  
                  
                  
                  8,938,964
                  
                  
                  
                  8,425,484Diluted
      earnings (loss) per share
                  
                  $
                  0.17
                  
                  
                  $
                  0.04
                  
                  
                  $
                  0.40
                  
                  
                  $
                  (0.22
                  )
 F-9
  AMERICAN
SURGICAL HOLDINGS, INC. AND SUBSIDIARIES
 (F/K/A
ASAH Corp.)
 NOTES
TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
 OF SEPTEMBER 30,
2009
 (UNAUDITED)
 
 
 Reclassification
 
 Certain
amounts from prior periods have been reclassified to conform to the current
period presentation.
  Revenue
Recognition
 
 The
Company recognizes its revenue over the period the service is performed in
accordance with FASB Accounting Standards Codification No, 605, Revenue Recognition. In
general, FASB Accounting Standards Codification No. 605 requires that four basic
criteria must be met before revenue can be recognized: (1) persuasive
evidence of an arrangement exists, (2) delivery has occurred or services
rendered, (3) the fee is fixed and determinable and (4) collectability
is reasonably assured.
 Service
Fees, net are recorded based on established billing rates less estimated
discounts for insurance reimbursements and patient payments. Management also
uses historical collection data to assure the collectability of the resulting
accounts receivable. No revenue is recorded for services performed for patients
covered by Medicare and/or Medicaid.
 
 Established
billing rates are not the same as actual pricing. They generally do not reflect
what the Company is ultimately paid and therefore are not displayed in our
Consolidated Statements of Operations. The Company is typically paid amounts
based on individual insurance company rate of discount.
 
 The
Company also recognizes Contract Fee Revenue billed under contracts with
hospitals for providing around the clock On-Call coverage.  These fees
are billed on a monthly basis throughout the respective contract period as
services are rendered.
 
 Allowance for Doubtful
Accounts
 
 The
Company generally provides for an allowance against accounts receivable for
amounts that may become uncollectible whereby such receivables are reduced to
their estimated net realizable value. The Company estimates this allowance based
on the aging of our accounts receivable, our historical collection experience,
and other relevant factors. There are various factors that can impact the
collection trends, such as changes in the number of uninsured patients, the
increased burden of co-payment to be made by patients, and insurance and
business practices related to collection efforts. These factors continuously
change and can have an impact on collection trends and our estimation
process.
 
 The
Company evaluates the collectability of its receivables at least quarterly using
various factors including the financial condition and payment history on patient
accounts, an overall review of collections experience on accounts, and other
economic factors or events expected to affect the Company’s future collections
experience.
 
 As part
of the evaluation discussed above concerning Revenue generated from Service Fees
and the appropriate Collection Percentage, the Company determined that an
allowance was necessary for the period ending September 30, 2009 in the amount
of $275,000 compared to $210,000 on December 31, 2008. This allowance is for
estimated charge backs.
 
 Long-Lived Assets
 
 Long-lived
assets and certain identifiable assets related to those assets are periodically
reviewed for impairment whenever circumstances and situations change such that
there is an indication that the carrying amounts may not be
recoverable.  If the non-discounted future cash flows of the
enterprise are less than their carrying amount, their carrying amounts are
reduced to fair value and an impairment loss is recognized.   As of
September 30, 2009, the Company did not record any impairment of its long lived
assets.
 
 Identifiable Intangible
Assets
 
 Intangible
assets are stated at cost net of accumulated amortization and
impairment.  Intangible assets other than goodwill, are amortized over
estimated useful lives.  Hospital contracts are amortized
over the life of the agreements, which is 6 months to 14
months.  The non compete agreement is amortized over the life of the
agreement of one year.   As of September 30, 2009, the Company
has recognized $ 44,833 of amortization expense related to the intangible
assets.
 
 
 F-10
 
 AMERICAN
SURGICAL HOLDINGS, INC. AND SUBSIDIARIES
 (
F/K/A ASAH Corp.)
 NOTES
TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
 OF SEPTEMBER 30,
2009
 (UNAUDITED)
 
 
 Recent
Accounting Pronouncements
 
 In June
2009, the FASB issued FASB Accounting Standards Codification No. 105, GAAP.  The
Codification will be the single source of authoritative U.S. generally accepted
accounting principles.  The Codification does not change generally
accepted accounting principles, but is intended to make it easier to find and
research issues.  The Codification introduces a new structure that
takes accounting pronouncements and organizes them by approximately 90
accounting topics.  The Codification is effective for interim and
fiscal years ending after September 15, 2009.  We adopted the
Codification on July 1, 2009.  The adoption of this statement did not
have a material effect on our financial statements but did change our reference
to generally accepted accounting principles beginning in the third quarter of
2009.
 
 In June
2009, the FASB issued FASB Accounting Standards Codification No. 860, Transfers and Servicing, and
FASB Accounting Standards Codification No. 810, Consolidation, which change
the way entities account for securitizations and special-purpose
entities.   The new standards eliminate existing exceptions,
strengthen the standards relating to securitizations and special-purpose
entities, and enhance disclosure requirements.  Both of these
statements are effective for fiscal years beginning after November 15,
2009.  The adoption of these statements will not have a material
effect on our financial statements.
 NOTE
2 BUSINESS ACQUISITIONS
 
 During
February, 2009, we reached an agreement with a surgical assistant corporation,
to join the Company. The agreement became effective March 1,
2009.  The agreement entitles the then owner to $50,000 in cash upon
execution and an incentive bonus based on profits, an annual base salary of
$117,000, 50,000 shares of common stock, and 50,000 shares of restricted shares
to be vested on the first anniversary of the closing date.
  Purchase
      Price
                
                $
                70,000Non
      Compete Agreement
                
                $
                10,000Hospital
      Contract
                
                
                60,000$
                70,000
  
 F-11
  
  
 AMERICAN
SURGICAL HOLDINGS, INC. AND SUBSIDIARIES
 (
F/K/A ASAH Corp.)
 NOTES
TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
 OF SEPTEMBER 30,
2009
 (UNAUDITED)
 
 
 NOTE
3 – EQUITY
 
 Stock Options and
Warrants
 
 The fair
market value of the stock options at the date of grant was estimated using the
Black-Scholes option-pricing model with the following assumptions:
  Expected
      Life
                
                3
      to 5 yearsInterest
      Rate
                
                2.25%
      to 4.25%Dividend
      Yield
                
                $0Volatility
                
                28%
      To 280%Forfeiture
      Rate
                
                0
  Expected
life represents the period of time that options are expected to be outstanding
and is based on the Company’s historical experience or the simplified method, as
permitted by FASB Accounting Standards Codification No. 718, Compensation – Stock
Compensation where appropriate. The risk-free interest rate is based on
U.S. Treasury interest rates at the time of the grant whose term is consistent
with the expected life of the stock options.
 
 Expected
dividend yield was considered to be $0 in the option pricing formula since the
Company does not pay dividends and has no current plans to do so in the future.
Expected volatility is based on the Company’s historical experience. The
forfeiture rate was considered to be none insofar as the historical experience
of the Company is very limited. As required by FASB Accounting Standards
Codification N.o 718, the Company will adjust the estimated forfeiture rate
based upon actual experience.
 The
Company recognized an expense of $190,375for stock
options earned during the nine months ended September 30, 2009.
  The
following tables summarize all stock option grants as of December 31, 2008 and
September 30, 2009, and the related changes during these periods are presented
below.
 
 Number
      of
                Options
              
              
              Weighted
      Average Exercise PriceStock
      OptionsBalance
      at December 31, 2008
              
              
              783,000
              
              
              $
              2.33Granted
              
              
              3,850,000
              
              
              
              0.08Exercised
              
              
              886,028
              
              
              
              .08Forfeited
              
              
              128,000
              
              
              
              2.00Balance
      at September 30, 2009
              
              
              3,618,972
              
              
              
              0.50Options
      exercisable on September 30, 2009
              
              
              600,616
              
              
              $
              2.40Weighted
      average fair value of options granted during 2009
              
              
              
              
              
              $
              0.08
 
 
 F-12
 
 
 
  AMERICAN
SURGICAL HOLDINGS, INC. AND SUBSIDIARIES
 (F/K/A
ASAH, CORP.)
 NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS
 SEPTEMBER 30,
2009
 
 
 The
following tables summarize information about stock options for the Company
at September 30, 2009 and December 31, 2008:
 
 September
      30, 2009 Options Outstanding
              
              
              Options
      ExercisableRange
      of
                Exercise
      Price
              
              
              Number
      Outstanding
                at
      September 30, 2009
              
              
              Weighted
      Average Remaining
                Contractual
      Life
              
              
              Weighted
      Average Exercise Price
              
              
              Number
      Exercisable
                at
      September 30, 2009
              
              
              Weighted
      Average Exercise Price$
              0.08
              
              
              
              2,963,972
              
              
              
              2.31
              
              
              $
              0.08
              
              
              
              0
              
              
              $
              0.08$
              2.00
      – 2.20
              
              
              
              125,000
              
              
              
              0.51
              
              
              $
              2.13
              
              
              
              113,082
              
              
              $
              2.13$
              2.21
      – 3.10
              
              
              
              530,000
              
              
              
              0.37
              
              
              $
              2.46
              
              
              
              487,534
              
              
              $
              2.46
 
 December
      31, 2008 Options Outstanding
              
              
              Options
      ExercisableRange
      of
                Exercise
      Price
              
              
              Number
      Outstanding
                at
      December 31, 2008
              
              
              Weighted
      Average Remaining
                Contractual
      Life
              
              
              Weighted
      Average Exercise Price
              
              
              Number
      Exercisable
                at
      December 31, 2008
              
              
              Weighted
      Average Exercise Price$
              2.00
      – 2.20
              
              
              
              253,000
              
              
              
              2.31
              
              
              $
              2.06
              
              
              
              221,750
              
              
              $
              2.04$
              2.21
      – 3.10
              
              
              
              530,000
              
              
              
              1.12
              
              
              $
              2.46
              
              
              
              363,333
              
              
              $
              2.48
  The
following tables summarize all stock warrants granted the end of December 31,
2008 and September 30, 2009, and the related changes during these periods are
presented below.
 
 Number
      of
                Warrants
              
              Weighted
      Average Exercise PriceStock WarrantsBalance
      at December 31, 2008
              
              3,258,000
              
              
              0.69Granted
              -Exercised
              
              197,500
              
              
              0.10Forfeited
              
              -Balance
      at September 30, 2009
              
              3,060,500
              
              
              0.68Warrants
      exercisable at September 30, 2009
              
              3,060,500
              
              $
              0.68Weighted
      average fair value of warrants granted during 2009
              
              
              
              
              -
 
 All
3,060,500 warrants are fully vested, exercisable and
non-forfeitable.
 
 The
following tables summarize information about stock warrants for the Company
at September 30, 2009 and December 31, 2008:
 
 September
      30, 2009 Warrants Outstanding
              
              
              Warrants
      ExercisableRange
      of
                Exercise
      Price
              
              
              Number
                Outstanding
      at
                September
      30, 2009
              
              
              Weighted
      Average Remaining
                Contractual
      Life
              
              
              Weighted
      Average Exercise Price
              
              
              Number
      Exercisable
                at
      September 30, 2009
              
              
              Weighted
      Average Exercise Price$
              0.10
      – 0.75
              
              
              
              2,517,500
              
              
              
              0.81
              
              
              $
              0.45
              
              
              
              2,517,500
              
              
              $
              0.45$
              2.00
              
              
              
              543,000
              
              
              
              1.67
              
              
              $
              2.00
              
              
              
              543,000
              
              
              $
              2.00
 
 
 F-13
  
 
 AMERICAN
SURGICAL HOLDINGS, INC. AND SUBSIDIARIES
 (F/K/A
ASAH, CORP.)
 NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS
 SEPTEMBER 30,
2009
 
 December
      31, 2008 Warrants Outstanding
              
              
              Warrants
      ExercisableRange
      of Exercise Price
              
              
              Number
                Outstanding
      at December 31, 2008
              
              
              Weighted
      Average Remaining
                Contractual
      Life
              
              
              Weighted
      Average Exercise Price
              
              
              Number
      Exercisable
                at
      December 31, 2008
              
              
              Weighted
      Average Exercise Price$
              0.10
      – 0.75
              
              
              
              2,715,000
              
              
              
              1.56
              
              
              $
              0.43
              
              
              
              2,715,000
              
              
              $
              0.43$
              2.00
              
              
              
              543,000
              
              
              
              2.42
              
              
              $
              2.00
              
              
              
              543,000
              
              
              $
              2.00
  NOTE 4
COMMITMENTS:
 
 The
Executive Employment Agreements of both Mr. Elgamal and Mr. Olmo-Rivas were
updated as of June 1, 2009.  With an effective date of January 1, 2009
for an initial term of ten years, to be renewed as per terms of the Agreement, a
quarterly bonus based on percentage of increase in the annual revenue, year over
year, which replaces the annual bonus that was in the previous Agreements, and a
bi-annual increase of 5% with the first raise taking place on the first
anniversary of the effective date. There were no changes to any of the remaining
sections of the agreements.
 
 NOTE 5 SUBSEQUENT
EVENTS
 
 In
preparing these financial statements, we have evaluated events and transactions
for potential recognition or disclosure through November 5, 2009, the date the
financial statements were issued.
 
 On
October 21, 2009, the Company exchanged 95,000 ten cent warrants to
restricted common stock.
 The
Company on November 5, 2009 received a request from a former note holder to
convert 50,000 warrants into 42,411 shares of common stock under the
cashless exercise provision in the warrants.
 
 F-14
   Item
2.  Management’s Discussion and Analysis of Financial Condition and
Results of Operations
 
 FORWARD-LOOKING
STATEMENTS
 
 This
report contains certain forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933, as amended, and Section 21E
of the Exchange Act of 1934, as amended, which are based on management’s
exercise of business judgment as well as assumptions made by and information
currently available to, management. When used in this document, the words may,
will, anticipate, believe, estimate, expect, intend and words of similar import,
are intended to identify any forward-looking statements. You should not place
undue reliance on these forward-looking statements. These statements reflect our
current view of future events and are subject to certain risks and uncertainties
as described in this Report on Form 10-Q as well as other periodic reports,
filed with the Securities and Exchange Commission, and as noted below. Should
one or more of these risks or uncertainties materialize, or should underlying
assumptions prove incorrect, our actual results could differ materially from
those anticipated in these forward-looking statements. We undertake no
obligation, and do not intend, to update, revise or otherwise publicly release
any revisions to these forward-looking statements to reflect events or
circumstances after the date hereof, or to reflect the occurrence of any
unanticipated events. Although we believe that our expectations are based on
reasonable assumptions, we can give no assurance that our expectations will
materialize.
 
 GENERAL
 
 The
following Management’s Discussion and Analysis, and Results of Operation,
highlights the principal factors that have affected the Company’s financial
condition and results of operations as well as the Company’s liquidity and
capital resources for the period ending September 30, 2009, with their
explanatory notes included as part of this Form 10-Q, and our Management’s
Discussion and Analysis and Results of Operations for the twelve months ended
December 31, 2008 included in our Form 10-K.
 
 We were
incorporated in the State of Delaware under the name Renfrew, Inc. on July 22,
2003 as a blank check company as defined under Rule 419 of the Securities Act.
On August 2, 2005, we filed Articles of Amendment with the State of Delaware
changing our name to ASAH Corp. and on January 9, 2007, we filed Articles of
Amendment with the State of Delaware changing our name to American Surgical
Holdings, Inc.
 
 Pursuant
to a Stock Purchase Agreement and Share Exchange between us and American
Surgical Assistants, Inc. dated October 10, 2005, we acquired all the shares of
American Surgical Assistants, Inc., a Texas corporation, from Zak Elgamal and
Jaime Olmo-Rivas. As a result of, and in consideration for, the issuance of our
common stock, American Surgical Assistants, Inc. became our wholly owned
subsidiary.
 
 We had
operated as a blank check company until the merger in October 2005 and the
purpose for this reorganization with American Surgical Assistants, Inc. was to
obtain an operating company which we believed has a successful business
plan.
 
 Through
American Surgical Assistants, Inc., we provide professional surgical assistant
services to patients, surgeons and healthcare institutions.
 
 In 2006
we incorporated our other subsidiary, ATS Billing Services, Inc. (ATS) to
provide HIPAA-compliant billing and collection services for healthcare industry
professionals.  This function was transferred to ASA in
2008.  ATS is currently dormant.
 
 In
January 2007, the Company completed a 1 for 2 common stock consolidation and in
April 2007 the Company completed a 1 for 1.75 common stock consolidation. All
share and per share amounts have been retroactively restated for the both the 1
for 2 and the 1 for 1.75 stock consolidations.
 
 
 -1-
  EXECUTIVE
SUMMARY
  The
Company’s revenue and net income improved in the nine months ended September 30,
2009 over the same period in 2008.  Sales have more than doubled in
the period this year over the same period last year.  Cash provided
from operations for the nine months ended September 30, 2009 was $4,746,863 on
$16,702,850 of sales which allowed the Company to pay off approximately
$2,900,000 of debt. As of September 30, 2009 the Company had no outstanding
notes payable.  Additionally, the Company generated a net income of
21% for the
nine months ended September 30, 2009 in comparison to a net loss of 24%in the nine
months ended September 30, 2008.   One of the reasons for the
improved performance is the Company has made improvements in billing and
appealing rejected claims.  The Company has increased its collection
per procedure during 2009. As of September 30, 2009, the Company has collected
approximately $2,300,000 in additional revenue related to 2008 services and an
additional $1,250,000 for services performed as of June 30,
2009.  This increase in collections was above the Company’s historical
collection rate and the Company continues to aggressively pursue reimbursement
of rejected claims.
  RESULTS
OF OPERATIONS FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2009 COMPARED TO THE
THREE MONTHS ENDED SEPTEMBER 30, 2008
 
 Revenue
 
 The net
revenue for the three months ended September 30, 2009 was $ 6,724,758 compared
to $ 3,072,479 for the three months ended September 30,
2008.   The net revenue for the quarter was approximately $
4,700,000 for the three months before adjustments.  The Company
recorded an additional $675.000 of net revenue from the aggressive collections
of 2008 receivables.  The additional money was over and above the
receivables as of December 31, 2008.  The Company also realized
increase net revenue from the first quarter receivables of approximately
$340,000 and second quarter receivables of approximately
$850,000.  The result was net revenue of $6,724,758.
  The
Company continues to expand its business.  We started coverage in two
facilities in the Commonwealth of Virginia during the first quarter of
2009.  During the fourth quarter of 2009 we will begin coverage in an
additional facility in Corpus Christi.   We are attempting to
open the market in two major cities in Texas.  In the fourth quarter
we will have three assistants in San Antonio and two in Dallas,
Texas.
  Cost
of Revenue
 
 Our cost
of revenue significantly improved in 2009 compared to 2008.  The cost
of revenue was $2,198,857 on $6,724,758 of revenue for the three months ended
September 30, 2009 as compared to a cost of $ 1,810,510 on $ 3,072,479 of
revenue for the three months ended September 30, 2008.  This is a cost
of revenue of 33% in 2009 versus 59% in 2008.  A significant
improvement which is mainly due to increased procedures, better revenue per
procedure, and significantly better utilization of the available human resources
and manpower.
  Gross
Profit
 
 The
Company generated a gross profit of 67% for the three
months ended September 30, 2009 in comparison to 41% over the same
period ended September 30, 2008.   This improvement is mainly due to
steps taken by management in 2008 and 2009 to improve revenue per procedure,
improved collections and an increase in the number of procedures performed by
our staff.
  Operating
Expenses
 
 Total operating expenses
during the third quarter of 2009 were $1,514,003 compared to $765,610 during the
third quarter of 2008, an increase of $748,393 a 98%
increase.  The expenses other than salaries and bonuses are in line
with last year.  The Company’s general and administrative expenses
were 9% or $ 26,400 higher than last year.  Salaries had the largest
increase of 162% or $725,585 over last year.  During the second
quarter of 2008 management volunteered to accept reductions in salary ranging
from 20% to 30% on both expenses and salaries.  The compensation
committee reinstated the salaries and expenses to the former level in January
2009.  In addition, the Company has almost doubled the size of its
billing staff to handle the increase production.Finally, the
board recommended a bonus to three of the Principals of $350,000.  The
lease of the office space had a small increase due to the annual “cost of
living” increase.
  
 -2-
 
 RESULTS
OF OPERATIONS FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2009 COMPARED TO THE NINE
MONTHS ENDED SEPTEMBER 30, 2008
 
 Revenue
 
 Our net revenue increased
to $ 16,702,850 for the nine months ended September 30, 2009 from $ 7,678,077
for the nine months ended September 30, 2008, an increase of$ 9,024,773
or 118% from 2008 to 2009.  The measures implemented by management in
the latter part of 2007 and all through 2008 and 2009 have increased the revenue
per procedure, and increased the number of procedures performed by our
assistants.   The increased emphasis on collecting receivables
has resulted in additional revenue from 2009 procedures and additional revenue
from 2008 receivables that were collected over the original estimate at December
31, 2008.  The Company experienced approximately $2,300,000 of
additional revenue from collections of 2008 receivables in 2009.  The
net revenue in the first nine months of 2008 was depressed due to underpaying
contracts with certain carriers.  These contracts are no longer in
place in 2009.
  Cost
of Revenue
 
 Our cost of revenue
increased to $ 6,115,198 for the nine months ended September 30, 2009 from $
5,302,845 for the nine months ended September 30, 2008, an increase of $812,353.   This represents a 15% increase over last year
which is a much smaller increase in comparison to the increase of 118% in net
revenue.  Cost cutting measures implemented by management in the
latter part of 2007, and all through 2008 have increased the revenue per
procedure, and increased the number of procedures performed by our
assistants.
 
 Gross
Profit
 
 Our gross
profit was $ 10,587,652 for the nine months ended September 30, 2009 as compared
to $ 2,375,232 over the same period ended September 30, 2008, an increase of $
8,212,420or
346%.   This is the result of an increase in net revenue equal to
118% and a cost of sales increase of 15% for the nine months ended September 30,
2009 over the nine months ended September 30, 2008.
 
 Operating
Expenses
 
 Our total
operating expenses for the nine months ended September 30, 2009 were $ 4,751,381
compared to $ 2,844,220 during the nine months ended September 30, 2008, an
increase of 67% or $1,907,161.  The
entire increase occurred in the second and third quarter of 2009 and was due
mainly to bonuses and reinstatement of 2008 pay cuts for
management.
  
 -3-
 
  Operating
Results as a Percentage of Net Revenue
 
 The Table
below provides a brief recap of operating results for the three months and nine
months ended September 30, 2009 and 2008 expressed as a percentage of net
revenue.
 
 For
      three months ending
              
              
              For
      nine months endingSEPTEMBER
      30
              
              
              SEPTEMBER
      302009
              
              
              2008
              
              
              2009
              
              
              2008Revenues,
      net
              
              
              100
              %
              
              
              100
              %
              
              
              100
              %
              
              
              100
              %Cost
      of Revenue
              
              
              33
              %
              
              
              59
              %
              
              
              37
              %
              
              
              69
              %Gross
      Profit
              
              
              67
              %
              
              
              41
              %
              
              
              63
              %
              
              
              31
              %Operating
      Expenses
              
              
              22
              %
              
              
              25
              %
              
              
              28
              %
              
              
              37
              %Net
      Income (Loss) from Operations
              
              
              45
              %
              
              
              16
              %
              
              
              35
              %
              
              
              (6
              %)Other
      (Expense) Income
              
              -
              
              
              
              (5
              %)
              
              
              (2
              %)
              
              
              (19
              %)Income
      (Loss) from Operations
              
              
              45
              %
              
              
              11
              %
              
              
              33
              %
              
              
              (25
              %)Provision
      for Income Taxes
              
              
              (16
              %)
              
              
              0
              %
              
              
              (12
              %)
              
              
              1
              %Net
      Income (Loss)
              
              
              29
              %
              
              
              11
              %
              
              
              21
              %
              
              
              (24
              %)
  LIQUIDITY
AND CAPITAL RESOURCES
 
 As of
September 30, 2009, the Company had $ 2,727,880 in cash and cash equivalents on
hand compared to $431,731 on hand on December 31, 2008.  Our working
capital (defined as current assets less current liabilities) at September 30,
2009 was$4,708,574compared to $832,248 onDecember
31, 2008.
  Our
operating activities provided cash in the amount of $ 4,746,863 for the nine
months ended September 30, 2009 compared to cash used in operations of $ 691,901
for the same period in 2008.  The five major factors influencing the
increase in cash provided from operating activities were:  (1) The
Company cancelled all contracts with carriers in the first and second quarter
2008. (2) Net revenue for the first nine months of 2009 was more than twice the
net revenue in 2008 (3) The collection of approximately $2,300,000 of old
receivables, (4)  Improved collections on 2009 receivables and (5) the
Company signed an agreement with two third party facilitator to streamline
collections.
  
 
 -4-
  
 Critical
Accounting Policies
 
 The
Company’s significant accounting policies are summarized in Note 1 of the
Company’s Condensed Consolidated Financial Statements included herein. Policies
determined to be significant are those policies that have the greatest impact on
the Company’s financial statements and require management to use greater degree
of judgment and estimates.
 
 Actual
results may differ from those estimates. Management believes that given the
current facts and circumstances, it is unlikely that applying any other
reasonable judgment or estimate methodologies would cause effect on the
Company’s consolidated results of operation or financial position and liquidity
for the periods presented in this report.
 
 The
preparation of financial statements in conformity with U. S. GAAP requires
management to make estimates and assumptions that affect the reported amounts of
assets and liabilities and the disclosure of contingent assets and liabilities
at the date of the financial statements and the reported amounts of revenue and
expenses during the reporting period.  Actual results could differ
from those estimates.
 
 Significant
estimates include revenue recognition, the allowance for doubtful accounts and
share based compensation.  These estimates have the potential to have
a significant impact on the Company’s financial statements, either because of
the significance of the financial statement item to which they relate, or
because they require judgment and estimation due to the uncertainty involved in
measuring, at a specific point in time, events what are continuous in
nature.
 
 Recent
Accounting Pronouncements
 
 In June
2009, the FASB issued FASB Accounting Standards Codification No. 105, GAAP.  The
Codification will be the single source of authoritative U.S. generally accepted
accounting principles.  The Codification does not change generally
accepted accounting principles, but is intended to make it easier to find and
research issues.  The Codification introduces a new structure that
takes accounting pronouncements and organizes them by approximately 90
accounting topics.  The Codification is effective for interim and
fiscal years ending after September 15, 2009.  We adopted the
Codification on July 1, 2009.  The adoption of this statement did not
have a material effect on our financial statements but did change our reference
to generally accepted accounting principles beginning in the third quarter of
2009.
 
 In June
2009, the FASB issued FASB Accounting Standards Codification No. 860, Transfers and Servicingand
FASB Accounting Standards Codification No. 810, Consolidation, which change
the way entities account for securitizations and special-purpose
entities.   The new standards eliminate existing exceptions,
strengthen the standards relating to securitizations and special-purpose
entities, and enhance disclosure requirements.  Both of these
statements are effective for fiscal years beginning after November 15,
2009.  The adoption of these statements will not have a material
effect on our financial statements.
 
 Off-Balance
Sheet Arrangements
 
 We have
no off-balance sheet arrangements that have or are reasonably likely to have a
current or future effect on our financial condition, changes in financial
condition, revenues or expenses, results of operations, liquidity, capital
expenditures or capital resources that is material to
stockholders.
 
 Item
3.  Quantitative and Qualitative Disclosures about Market
Risks
 
 We
conduct our business in United States Dollars. Our market risk is limited to the
United States domestic, economic and regulatory factors.
 
 
 -5-
 
  Item
4. Controls and Procedures
 
 a)  
Evaluation of Disclosure
Controls. Our Chief Executive Officer and our Chief Financial and
Accounting Officer evaluated the effectiveness of our disclosure controls and
procedures as of the end of our third fiscal quarter 2009 pursuant to Rule
13a-15(b) of the Securities and Exchange Act. Disclosure controls and procedures
are controls and other procedures that are designed to ensure that information
required to be disclosed by us in the reports that we file or submit under the
Exchange Act is recorded, processed, summarized and reported within the time
periods specified in the SEC’s rules and forms. Disclosure controls and
procedures include, without limitation, controls and procedures designed to
ensure that information required to be disclosed by us in the reports that we
file under the Exchange Act is accumulated and communicated to our management,
as appropriate to allow timely decisions regarding required disclosure. Based on
their evaluation, the Chief Executive Officer and Chief Financial and Accounting
Officer concluded that our disclosure controls and procedures were effective as
of September 30, 2009.
 
 It should
be noted that any system of controls, however well designed and operated, can
provide only reasonable, and not absolute, assurance that the objectives of the
system are met. In addition, the design of any control system is based in part
upon certain assumptions about the likelihood of future events. Because of these
and other inherent limitations of control systems, there can be no assurance
that any design will succeed in achieving its stated goals under all potential
future conditions
 
 (b)
  Changes in internal
control over financial reporting. There have been no changes in our
internal control over financial reporting that occurred during the last fiscal
quarter that has materially affected, or is reasonably likely to materially
affect, our internal control over financial reporting.
  
 -6-
 
 
 PART
II - OTHER INFORMATION
 
 Item
1. Legal Proceedings.
 
 Currently
we are not aware of any litigation pending or threatened by or against the
Company.
 
 Item
2. Unregistered Sales of Equity Securities and Use of Proceeds
 
 During
the quarter ended, September 30, 2009, options and warrant holders converted
1,083,528 options and warrants to 1,083,528 common shares.  Such
shares were issued pursuant to an exemption from registration of section 4(2) of
the Securities Act of 1933.
 Item
3. Defaults Upon Senior Securities.
 
 None
 
 Item
4. Submission of Matters to a Vote of Security Holders.
 
 None
 
 Item
5. Other Information.
 
 None
  Item
6. Exhibits and Reports of Form 8-K.
 
 (a)
              Exhibits
 
 31.1
      Certifications of Chief Executive Officer pursuant to Section 302 of
      Sarbanes Oxley Act of 200231.2
      Certifications of Chief financial Officer pursuant to Section 302 of
      Sarbanes Oxley Act of 2002
 
 32.1
      Certifications of Chief Executive Officer pursuant to Section 906 of
      Sarbanes Oxley Act of 200232.2
      Certifications of Chief financial Officer pursuant to Section 906 of
      Sarbanes Oxley Act of 2002
 
 
 
 -7-
 
 SIGNATURES
 
 Pursuant
to the requirements of the Securities Exchange Act of 1934, as amended, the
registrant caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
 
 AMERICAN
SURGICAL HOLDINGS, INC.
  Date:
      November 13, 2009
              By:
              /s/
      ZAK W.
      ELGAMALZak
      W. ElgamalChairman
      & Chief Executive Officer
                and
      Principal Executive OfficerDate:
      November 13,  2009
              By:
              /s/
      JAMES A.
      LONGAKERJames
      A. LongakerChief
      Financial Officer and
                Principal
      Accounting Officer


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