Exhibit 5
THELEN REID & PRIEST LLP
40 West 57th Street
New York, NY 10019
(212) 603-6780
New York, New York
September 10, 1998
American Electromedics Corp.
13 Columbia Drive, Suite 5
Amherst, New Hampshire 03031
Gentlemen:
We have acted as special counsel to American
Electromedics Corp., a Delaware corporation (the "Company"), in
connection with the preparation of a Registration Statement on
Form SB-2 (the "Registration Statement") relating to the
registration of (A) 4,570,798 shares of the Company's Common
Stock, $.10 par value per share ("Common Stock"), which have been
issued in various private placements since October of 1996 (the
"Private Placements"), (B) 1,433,333 shares of Common Stock
issuable upon exercise of presently exercisable warrants and
options (the "Options and Warrants") including those issuable
under the West End Warrants (as defined below), (C) 1,085,003
shares of Common Stock issuable upon conversion of the Company's
Convertible Preferred Stock, Series A, par value $.01 per share
(the "Series A Preferred Stock"), and (D) 50,000 Common Stock
Purchase Warrants issued to West End Capital LLC in connection
with the issuance of the Series A Preferred Stock (the "West End
Warrants").
The Private Placements consisted principally of (i)
1,000,000 shares issued as of March 15, 1998 to Liviakis
Financial Communications, Inc., a financial consultant, as part
of a consulting fee (the "LFC Consulting Fee"); (ii) 1,050,000
shares issued as of November 26, 1997 in a private placement of
Common Stock (the "1997 Private Placement"); (iii) 750,000 shares
issued as of May 5, 1998 in connection with the acquisition by
the Company of Dynamic Dental Systems, Inc. (the "DDS Merger");
(iv) 720,000 shares issued as of November 3, 1997 in connection
with the conversion of the Company's 14% Convertible Subordinated
Debentures (the "Debenture Conversion"); (v) 600,000 shares
issued as of May 12, 1998 in connection with the acquisition by
the Company of Equidyne Systems, Inc. (the "ESI Merger"); and
(vi) 210,000 shares issued as of December 18, 1997 in connection
with the purchase of all the remaining interests in Rosch Gmbh
Medizintechnic which had not previously been acquired by the
Company and the purchase of an interest in Meditronic
Medizinelektronic Gmbh (the "Rosch Acquisitions").
The Options and Warrants consist of (i) warrants to
purchase 1,000,000 shares of Common Stock issued as part of the
LFC Consulting Fee; (ii) warrants to purchase 300,000 shares of
Common Stock issued to Marcus Rowan, a Director of the Company;
(iii) warrants to purchase 50,000 shares of Common Stock issued
to Blake C. Davenport, a Director of the Company; (iv) warrants
to purchase 30,000 shares of Common Stock issued to Cohig &
Associates, the placement agent for the Series A Preferred Stock;
(v) options to purchase 13,333 shares of Common Stock issued to
Wall Street Consultants; and (vi) the West End Warrants.
This opinion is being rendered in connection with the
filing by the Company of the Registration Statement.
For purposes of this opinion, we have examined
originals or copies, certified or otherwise identified to our
satisfaction, of (i) the Registration Statement; (ii) the
Certificate of Incorporation and By-Laws of the Company, as in
effect on the date hereof; (iii) the Certificate of Designation
of the Class A Preferred Stock; (iv) agreements and documents
relating to the placement of the Class A Preferred Stock; (v) the
option and warrant agreements relating to the Options and
Warrants; (vi) agreements and documents relating to the 1997
Private Placement; (vii) agreements and documents relating to the
DDS Merger; (viii) agreements and documents relating to the ESI
Merger; (ix) agreements and documents relating to the Rosch
Acquisitions; (x) the agreement under which the LFC Consulting
Fee was paid; (xi) agreements and documents relating to the
Debenture Conversion; (xii) the resolutions adopted by the Board
of Directors of the Company relating to each of the foregoing and
(xiii) such other documents, certificates or other records as we
have deemed necessary or appropriate.
Based upon the foregoing, and subject to the
qualifications hereinafter expressed, we are of the opinion that:
(1) The Company is a corporation duly organized,
validly existing and in good standing under the
laws of the State of Delaware.
(2) The shares of Common Stock included in the
Registration Statement which are presently issued
and outstanding were duly authorized, validly
issued, and are fully paid and non-assessable.
(3) The shares of Common Stock included in the
Registration Statement to be issued upon the
conversion of the Class A Preferred Stock will be
duly authorized and validly issued, and fully paid
and non-assessable when the Class A Preferred
Stock is duly converted in accordance with the
Certificate of Designation of the Class A
Preferred Stock.
(4) The shares of Common Stock included in the
Registration Statement to be issued upon the
exercise of the Options and Warrants will be duly
authorized and validly issued, and fully paid and
non-assessable when the Options and Warrants are
duly exercised and the exercise price is paid for
the shares of Common Stock underlying such options
and warrants in accordance with the terms of the
respective option and warrant agreements.
(5) The West End Warrants were duly authorized and
validly issued, and are fully paid and non-
assessable.
We are members of the Bar of the State of New York and
do not hold ourselves out as experts concerning, or qualified to
render opinions with respect to, any laws other than the laws of
the State of New York, the Federal laws of the United States and
the General Corporation Law of the State of Delaware.
We hereby consent to the reference to this firm under
the caption "Legal Matters" in the Prospectus included in the
Registration Statement and to the filing of this opinion with the
Securities and Exchange Commission as Exhibit 5 to the
Registration Statement. In giving the foregoing consent, we do
not thereby admit that we are in the category of persons whose
consent is required under Section 7 of the Securities Act, or the
rules and regulations of the Securities and Exchange Commission
thereunder.
Very truly yours,
/s/ Thelen Reid & Priest LLP
Thelen Reid & Priest LLP