AMERICAN MEDICAL PROVIDERS INC, S-1/A, 1998-03-09

AMERICAN MEDICAL PROVIDERS INC
S-1/A, 1998-03-09
HEALTH SERVICES

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AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MARCH 9, 1998
REGISTRATION NO. 333-39441

================================================================================
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------

AMENDMENT NO. 4
TO
FORM S-1

REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------------
AMERICAN MEDICAL PROVIDERS, INC.
ANKLE & FOOT CENTERS OF AMERICA, LLC
(EXACT NAME OF REGISTRANTS AS SPECIFIED IN ITS CHARTER)

DELAWARE 76-0530185
DELAWARE 8099 59-3357094
(STATE OR OTHER (PRIMARY STANDARD
JURISDICTION OF INDUSTRIAL
INCORPORATION OR CLASSIFICATION CODE (I.R.S. EMPLOYER
ORGANIZATION) NUMBER) IDENTIFICATION NUMBERS)
8043
(SECONDARY STANDARD
INDUSTRIAL
CLASSIFICATION CODE
NUMBER)

------------------------

JACK N. MCCRARY
AMERICAN MEDICAL PROVIDERS, INC. AMERICAN MEDICAL PROVIDERS, INC.
3555 TIMMONS LANE, SUITE 1550 3555 TIMMONS LANE, SUITE 1550
HOUSTON, TEXAS 77027 HOUSTON, TEXAS 77027
(713) 621-5500 (713) 621-5500
(ADDRESS, INCLUDING ZIP CODE, AND (NAME AND ADDRESS, INCLUDING ZIP
TELEPHONE NUMBER, CODE, AND TELEPHONE
INCLUDING AREA CODE, OF REGISTRANTS' NUMBER, INCLUDING AREA CODE, OF AGENT
PRINCIPAL EXECUTIVE OFFICES) FOR SERVICE)

------------------------

COPIES TO:
IVAN WOOD DAVID J. RINGELMAN MICHAEL L. BOYKINS
BAKER & HOSTETLER LLP BAKER & HOSTETLER LLP BERNARD S. KRAMER
1000 LOUISIANA, SUITE 303 EAST 17TH AVENUE, MCDERMOTT, WILL & EMERY
2000 SUITE 1100 227 WEST MONROE STREET,
HOUSTON, TEXAS 77002 DENVER, COLORADO 80203 SUITE 3100
(713) 751-1600 (303) 861-0600 CHICAGO, ILLINOIS
60606-5096
(312) 372-2000

------------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As soon
as practicable after this Registration Statement becomes effective.
------------------------
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, check the following box. [ ]

If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, check the following box and
list the Securities Act registration statement number of the earlier effective
registration statement for the same offering. [ ]

If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]

If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]

------------------------

CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------
PROPOSED PROPOSED
TITLE OF EACH CLASS OF MAXIMUM MAXIMUM
SECURITIES TO BE AMOUNT TO BE OFFERING PRICE AGGREGATE AMOUNT OF
REGISTERED REGISTERED PER UNIT(1) OFFERING PRICE(1) REGISTRATION FEE
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Class A Common Stock..... 4,255,000(2) $12.00 $51,060,000 $0
- ---------------------------------------------------------------------------------------------------------
Promissory Notes......... $1,472,500 100% $1,472,500 $15
Membership Interests..... 25,840 $5,000 $77,500(3) $1
- ---------------------------------------------------------------------------------------------------------
Total.................... $16(4)
- ---------------------------------------------------------------------------------------------------------
</TABLE>
- ------------

(1) Estimated solely for purposes of calculating the registration fee pursuant
to Rule 457.

(2) Includes 555,000 shares of Class A Common Stock which the Underwriter has
the option to purchase from the Company to cover over-allotments, if any.

(3) AFC sold 15 1/2 units, each consisting of a promissory note in the
aggregate principal amount of $95,000 and 1,667 membership interests in AFC
for $5,000. Such number is calculated by multiplying 15 1/2 units by
$5,000.

(4) The total Amount of Registration Fee is equal to $15,944, $15,928 of which
was previously paid by the Company.

THE REGISTRANTS HEREBY AMEND THIS REGISTRATION STATEMENT ON SUCH DATES AS
MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANTS SHALL FILE A
FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT
SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF THE
SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.

- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>
CROSS-REFERENCE SHEET PURSUANT TO ITEM 501(B) OF REGULATION S-K

FORM S-1 ITEM
NUMBER AND CAPTION LOCATION IN PROSPECTUS
- ------------------------------------- -----------------------------------------
1. Forepart of the Registration
Statement and Outside Front
Cover Page ofProspectus......... Outside Front Cover Page
2. Inside Front and Outside Back
Cover Pagesof Prospectus........ Inside and Outside Back Cover Pages
3. Summary Information, Risk
Factors and Ratio of Earnings
to Fixed Charges................ Prospectus Summary; Risk Factors
4. Use of Proceeds................. Use of Proceeds
5. Determination of Offering
Price........................... Underwriting
6. Dilution........................ Dilution
7. Selling Security Holders........ *
8. Plan of Distribution............ Underwriting
9. Description of Securities to be
Registered...................... Description of Capital Stock
10. Interests of Named Experts and
Counsel......................... Legal Matters
11. Information with Respect to the
Registrant...................... Outside and Inside Front Cover Pages;
Prospectus Summary; Risk Factors; Use of
Proceeds; Capitalization; Selected
Financial Data; Management's Discussion
and Analysis of Financial Condition and
Results of Operations; Business;
Management; Certain Transactions;
Principal Stockholders; Description of
Capital Stock; Financial Statements
12. Disclosure of Commission
Position on Indemnification for
Securities Act Liabilities...... *

- ------------

* Answer is negative or item is not applicable.
<PAGE>
EXPLANATORY NOTE

The form of Prospectus filed as a part of this Amendment contains three
alternative forms of cover page. The first form of cover page relates to an
offer of rescission (the "Units Rescission Offer") to be made to certain
holders of promissory notes and membership interests in Ankle & Foot Centers of
America, LLC ("AFC") (the "AFC Units") issued by AFC, a principal
stockholder of American Medical Providers, Inc. (the "Company"). Because the
AFC Units were issued after the Company's Registration Statement on Form S-1
(the "Registration Statement") was filed and because, as a condition to their
investment in the AFC Units, investors in the AFC Units were given the
opportunity by the Company to purchase shares of Class A Common Stock, par value
$.001 per share, of the Company (the "Class A Common Stock") in the Company's
underwritten initial public offering (the "Offering") at the initial public
offering price, an argument can be made that the consummation of the Offering
contemplated by the Registration Statement might cause the exemptions from
registration relied on in connection with the offer and sale of the AFC Units to
be made unavailable. It is contemplated that the Units Rescission Offer will be
completed after the closing of the Company's Offering. See "Units Rescission
Offer." The second form of cover page relates to an offer by the Company to
rescind a potential offer to sell Common Stock to certain persons (the
"Practice Owners") with whom the Company had entered into negotiations and
non-binding letters of intent, after the filing of the Registration Statement,
to purchase certain of the assets or stock of their podiatric practices (the
"Practice Owner Rescission Offer"). None of those negotiations or letters of
intent involved the initial Affiliated Practices. Because the negotiations as to
valuation of the practices occurred after the Company filed the Registration
Statement, an argument can be made that the consummation of the Offering
contemplated by the Registration Statement will cause the potential offer of
Common Stock to the Practice Owners to have not been in compliance with federal
and state securities laws. It is contemplated that the Practice Owner Rescission
Offer will be completed after the closing of the Company's Offering. The
Underwriters of the Offering are not parties to the Units Rescission Offer or
the Practice Owner Rescission Offer and none of the legal matters relating
thereto will be passed upon by McDermott, Will & Emery, counsel to the
Underwriters. The third form of cover page is intended to be used in connection
with the Offering.

<PAGE>
Information contained herein is subject to completion or amendment. A
registration statement relating to these securities has been filed with the
Securities and Exchange Commission. The securities offered hereby may not be
sold nor may offers to buy be accepted prior to the time the registration
statement becomes effective. This prospectus shall not constitute an offer to
sell or the solicitation of an offer to buy nor shall there be any sale of the
securities offered hereby in any state in which such offer, solicitation or sale
would be unlawful prior to registration or qualification under the securities
laws of any such state.

SUBJECT TO COMPLETION, DATED MARCH 9, 1998
PROSPECTUS

$1,472,500 PRINCIPAL AMOUNT OF PROMISSORY NOTES
25,840 MEMBERSHIP INTERESTS

AMERICAN MEDICAL PROVIDERS, INC.
ANKLE & FOOT CENTERS OF AMERICA, LLC
------------------------

This Prospectus relates to a rescission offer (the "Units Rescission
Offer") with respect to $1.4725 million principal amount of Promissory Notes
("AFC Promissory Notes") and 25,840 membership interests ("AFC Units") of
Ankle & Foot Centers of America, LLC ("AFC"). The AFC Units were offered and
sold by AFC, a principal stockholder of American Medical Providers, Inc. (the
"Company"), to 16 investors (the "Bridge Investors") in reliance on certain
exemptions from registration under the Securities Act of 1933 (the "Securities
Act"). The Company may have certain contingent liabilities with respect to the
Units Rescission Offer as described below. See "UNITS RESCISSION
OFFER -- Effect of the Units Rescission Offer."

The sections of this Prospectus entitled "Prospectus Summary -- The
Offering," "Dilution," "Use of Proceeds" and "Underwriting," as well as
portions of other sections of this Prospectus, relate to the Company's
underwritten public offering of Common Stock being made concurrently with the
Units Rescission Offer evidenced hereby and do not apply to the Units Rescission
Offer. The Underwriters of the public offering are not parties to the Units
Rescission Offer and none of the legal matters relating thereto will be passed
upon by McDermott, Will & Emery, counsel to the Underwriters.

UNITS RESCISSION OFFER

THE FOLLOWING INFORMATION IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO THE
ACCOMPANYING PROSPECTUS. THE BRIDGE INVESTORS ARE URGED TO READ THE PROSPECTUS
IN ITS ENTIRETY IN ORDER TO MAKE AN INDEPENDENT EVALUATION WITH RESPECT TO THIS
UNITS RESCISSION OFFER.

The Company hereby extends an offer (the "Units Rescission Offer") to
rescind the offer and sale of the AFC Units between October 1997 and February
1998. Because the AFC Units were offered and sold after the registration
statement of which this Prospectus is a part was filed with the Securities and
Exchange Commission (the "Commission") by AFC and because, as part of their
investment in the AFC Units, the Bridge Investors in the AFC Units were given
the option by the Company to purchase shares in the Company's underwritten
initial public offering at the initial public offering price, an argument can be
made that the consummation of the Company's public offering of Common Stock will
cause such exemptions to be retroactively unavailable. This Units Rescission
Offer applies only to the Bridge Investors.

To ACCEPT the Units Rescission Offer, a Bridge Investor is required to
complete and sign the section entitled "Acceptance of Rescission Offer" on the
Units Rescission Form, which will be subsequently provided to the Bridge
Investors by AFC.

To REJECT the Units Rescission Offer, a Bridge Investor is required to
complete and sign the section entitled "Rejection of Rescission Offer" on the
Units Rescission Form, which will be subsequently provided to the Bridge
Investors, and return it to AFC. AFC AND THE COMPANY WILL REJECT THE UNITS
RESCISSION OFFER ON BEHALF OF ANY BRIDGE INVESTORS WHO FAIL TO RETURN A PROPERLY
COMPLETED UNITS RESCISSION FORM PRIOR TO THE EXPIRATION OF THE UNITS RESCISSION
OFFER.

If this Units Rescission Offer is ACCEPTED by a Bridge Investor, the Bridge
Investor will be paid the purchase price of the AFC Units purchased by such
Bridge Investor, plus interest from the date of purchase at statutory rate of
interest. If this Units Rescission Offer is REJECTED by a Bridge Investor, such
Bridge Investor will continue to hold the AFC Units. With respect to each AFC
Unit, such AFC Promissory Notes will be repurchased for $95,000 and the AFC
membership interests will be repurchased for $71,667 by AFC upon the
consummation of the Company's initial public offering. WHETHER THE UNITS
RESCISSION OFFER IS ACCEPTED OR REJECTED, BRIDGE INVESTORS WILL NOT RETAIN THE
RIGHT TO HAVE ANY COMMON STOCK SET ASIDE TO PURCHASE AT THE INITIAL PUBLIC
OFFERING PRICE. In either case, Bridge Investors will continue to have certain
rights of redress as permitted under the Securities Act and its statute of
limitations and applicable state securities laws. See "UNITS RESCISSION
OFFER -- Effect of the Units Rescission Offer" on page ii for a description of
the legal rights and obligations of accepting or rejecting the Units Rescission
Offer.

This Units Rescission Offer will expire at the close of business on the
earlier of (i) 30 days from the date of this Prospectus or (ii) the Company's
receipt of a properly completed Units Rescission Form from each Bridge Investor.
Bridge Investors are urged to read thoroughly this Units Rescission Offer and
the accompanying Prospectus. Bridge Investors may call Wayne A. Bertsch, a
Senior Vice President of the Company, at (713) 621-5500 if they have any
questions concerning the terms and conditions of the Units Rescission Offer.

NEITHER AFC, THE COMPANY NOR THEIR RESPECTIVE MANAGEMENT MAKES ANY
RECOMMENDATION TO THE BRIDGE INVESTORS AS TO WHETHER TO ACCEPT THE UNITS
RESCISSION OFFER OR TO REJECT THE UNITS RESCISSION OFFER. BRIDGE INVESTORS MUST
MAKE THEIR OWN DECISION AS TO WHETHER TO ACCEPT OR REJECT THE UNITS RESCISSION
OFFER.

THE DATE OF THIS PROSPECTUS IS MARCH , 1998

<PAGE>
THE UNITS RESCISSION FORM AND THE SECURITIES ACT

Between October 1997 and February 1998, AFC offered and sold the AFC Units
by which the Bridge Investors purchased an aggregate principal amount of
$1,472,500 AFC Promissory Notes and 25,840 membership interests in AFC. Because
some of the AFC Units were issued after the Company's Registration Statement on
Form S-1 (the "Registration Statement") was filed and because, as a condition
to their investment in the AFC Units, investors in the AFC Units were given the
option by the Company to purchase shares of Common Stock of the Company in the
Company's underwritten initial public offering at the initial public offering
price, an argument can be made that the consummation of the underwritten initial
public offering of Common Stock contemplated by the Registration Statement will
cause the exemptions from registration relied on in connection with the offer
and sale of the AFC Units to be made unavailable. In order to limit their
potential liability under the Securities Act, AFC and the Company are
undertaking this Units Rescission Offer with respect to the offer and sale of
the AFC Units.

EFFECTS OF THE UNITS RESCISSION OFFER

Bridge Investors may ACCEPT the Units Rescission Offer or REJECT the Units
Rescission Offer. There can be no assurance that the liability of the Company
and AFC based upon any possible failure of the Company or AFC to comply with
federal or state securities law in connection with the Bridge Financing will be
eliminated. If this Units Rescission Offer is ACCEPTED, Bridge Investors will be
paid the purchase price of the AFC Units, plus interest on the AFC Units from
the date of purchase at the statutory rate. If the Units Rescission Offer is
REJECTED, holders of the AFC Units will continue to hold AFC Units, such AFC
Promissory Notes will be repurchased for $95,000 in cash, and the AFC membership
interests will be repurchased for $71,667 in cash by AFC upon the successful
completion of the Company's initial public offering. However, the Bridge
Investors will not retain the right to have any Common Stock set aside for
purchase at the initial public offering price.

It is the position of the Staff of the Commission that any liability of the
Company or AFC under the Securities Act for the sale of AFC Units may survive
and not be barred by the Units Rescission Offer. However, it is possible that a
court would hold that the legal remedies available to the Bridge Investors are
diminished as a result of the Units Rescission Offer. Although the legal
principles applicable to a transaction such as the Units Rescission Offer are
not clear, among possible bases for such a determination are that any Bridge
Investor who accepts the Units Rescission Offer thereby will have entered into
an accord and satisfaction that moots any claim for damages, and that any such
Bridge Investor who rejects the Units Rescission Offer may have waived or be
estopped from asserting his or her rights by failing to accept the Units
Rescission Offer.

STATE LAW CLAIMS

The Units Rescission Offer may have no effect on rights, if any, of Bridge
Investors under applicable state securities laws; however, AFC and the Company
do not believe that any such rights, if asserted and determined adversely to AFC
or the Company, would have a material adverse effect on AFC or the Company.

PROCEDURES FOR ACCEPTING THE UNITS RESCISSION OFFER

For a Bridge Investor to ACCEPT the Units Rescission Offer, a properly
completed section entitled "Acceptance of Rescission Offer" on the Units
Rescission Form, in the form to be subsequently provided by AFC, evidencing such
election must be received by AFC prior to the expiration of the Units Rescission
Offer.

A Bridge Investor may REJECT the Units Rescission Offer by executing the
section entitled "Rejection of Rescission Offer" on the Units Rescission Form
to be subsequently provided by AFC prior to the expiration of the Rescission
Offer. AFC AND THE COMPANY WILL REJECT THE UNITS RESCISSION OFFER ON BEHALF OF
ANY BRIDGE INVESTOR WHO FAILS TO RETURN A PROPERLY COMPLETED UNITS RESCISSION
FORM PRIOR TO THE EXPIRATION OF THE UNITS RESCISSION OFFER. The Units Rescission
Form to be subsequently provided by AFC may be delivered by hand, courier
service, facsimile or mail to AFC to the attention of Wayne A. Bertsch, American
Medical Providers, Inc., 3555 Timmons Lane, Suite 1550, Houston, Texas 77027
(facsimile: (713) 621-4148). The method of delivery of all documents is at the
election of the Bridge Investors. A Units Rescission Form will not be deemed to
be delivered timely to AFC if AFC does not actually receive the Units Rescission
Form prior to expiration of the Units Rescission Offer, although AFC reserves
the right in its sole discretion to accept a Units Rescission Form subsequent to
the expiration date upon showing of proper cause.

ii
<PAGE>
Information contained herein is subject to completion or amendment. A
registration statement relating to these securities has been filed with the
Securities and Exchange Commission. The securities offered hereby may not be
sold nor may offers to buy be accepted prior to the time the registration
statement becomes effective. This prospectus shall not constitute an offer to
sell or the solicitation of an offer to buy nor shall there be any sale of the
securities offered hereby in any state in which such offer, solicitation or sale
would be unlawful prior to registration or qualification under the securities
laws of any such state.

SUBJECT TO COMPLETION, DATED MARCH 9, 1998
PROSPECTUS

AMERICAN MEDICAL PROVIDERS, INC.
------------------------

This Prospectus relates to an offer by American Medical Providers, Inc.
(the "Company") and Ankle & Foot Centers of America, LLC to rescind (the
"Practice Owner Rescission Offer") a potential non-binding offer to sell Class
A common stock, par value $.001 per share, of the Company ("Common Stock"),
made on certain dates between November 5, 1997 and February 11, 1998 to the 13
holders of certain operating assets of, or the stock of entities holding certain
operating assets of, twelve podiatric practices (the "Practice Owners"), as
described below and none of these negotiations or letters of intent involved the
initial Affiliated Practices (as defined herein). The Company may have certain
contingent liabilities with respect to the Practice Owner Rescission Offer as
described below. See "PRACTICE OWNER RESCISSION OFFER -- Effect of the Practice
Owner Rescission Offer."

The sections of this Prospectus entitled "Prospectus Summary -- The
Offering," "Dilution," "Use of Proceeds" and "Underwriting," as well as
portions of other sections of this Prospectus, relate to the Company's
underwritten public offering of Common Stock being made concurrently with the
Practice Owner Rescission Offer evidenced hereby, and do not apply to the
Practice Owner Rescission Offer. The Underwriters of the public offering are not
parties to the Practice Owner Rescission Offer and none of the legal matters
relating thereto will be passed upon by McDermott, Will & Emery, counsel to the
Underwriters.

PRACTICE OWNER RESCISSION OFFER

THE FOLLOWING INFORMATION IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO THE
ACCOMPANYING PROSPECTUS. THE PRACTICE OWNERS ARE URGED TO READ THE PROSPECTUS IN
ITS ENTIRETY IN ORDER TO MAKE AN INDEPENDENT EVALUATION WITH RESPECT TO THIS
PRACTICE OWNER RESCISSION OFFER.

The Company hereby extends an offer to rescind a potential non-binding
offer to sell (the "Practice Offer") Common Stock to 13 Practice Owners on
certain dates between November 5, 1997 and February 11, 1998. The Company has
determined that the Practice Offer may not have satisfied the requirements of
the Securities Act of 1933, as amended (the "Securities Act"), because no
prospectus was distributed to the Practice Owners as required by the Securities
Act. This Practice Owner Rescission Offer applies only to the Practice Owners.

To ACCEPT the Practice Owner Rescission Offer, a Practice Owner is required
to complete and sign the section entitled "Acceptance of Owner Rescission
Offer" on the Practice Owners Rescission Form which will be subsequently
provided to the Practice Owners by the Company.

To REJECT the Practice Owner Rescission Offer, a Practice Owner is required
to complete and sign the section entitled "Rejection of Owner Rescission
Offer" on the Practice Owner Rescission Form which will be subsequently
provided to the Practice Owners by the Company. THE COMPANY WILL REJECT THE
PRACTICE OWNER RESCISSION OFFER ON BEHALF OF ANY PRACTICE OWNER WHO FAILS TO
RETURN A PROPERLY COMPLETED PRACTICE OWNER RESCISSION FORM PRIOR TO THE
EXPIRATION OF THE PRACTICE OWNER RESCISSION OFFER.

If a Practice Owner Rescission Offer is ACCEPTED by a Practice Owner, the
Practice Owner's non-binding letter of intent will be cancelled and rendered
null and void. If the Practice Owner Rescission Offer is REJECTED by a Practice
Owner, the Company will deliver a prospectus from its Registration Statement on
Form S-4 to such Practice Owner and reopen negotiations with such Practice Owner
after the consummation of the Practice Owner Rescission Offer. In either case,
Practice Owners will continue to have such rights of redress as permitted under
the Securities Act and its statute of limitations and applicable state
securities laws. See "PRACTICE OWNER RESCISSION OFFER -- Effect of the Practice
Owner Rescission Offer" on page ii for a description of the legal consequences
of accepting or rejecting the Practice Owner Rescission Offer.

This Practice Owner Rescission Offer will expire at the close of business
on the earlier of (i) 30 days from the date of this Prospectus or (ii) the
Company's receipt of a properly completed Practice Owner Rescission Form from
each Practice Owner. Practice Owners are urged to read thoroughly this Practice
Rescission Offer and the accompanying Prospectus. Practice Owners may call Wayne
A. Bertsch, a Senior Vice President of the Company, at (713) 621-5500 if they
have any questions concerning the terms and conditions of the Practice Owner
Rescission Offer.

NEITHER AFC, THE COMPANY NOR THEIR RESPECTIVE MANAGEMENT MAKES ANY
RECOMMENDATION TO THE PRACTICE OWNERS AS TO WHETHER TO ACCEPT THE PRACTICE OWNER
RESCISSION OFFER OR TO REJECT THE PRACTICE OWNER RESCISSION OFFER. PRACTICE
OWNERS MUST MAKE THEIR OWN DECISION AS TO WHETHER TO ACCEPT OR REJECT THE
PRACTICE OWNER RESCISSION OFFER.

THE DATE OF THIS PROSPECTUS IS MARCH , 1998

<PAGE>
THE PRACTICE RESCISSION FORM AND THE SECURITIES ACT

Between November 5, 1997 and February 11, 1998, the Company entered into
negotiations with and delivered non-binding letters of intent to the Practice
Owners by which each Practice Owner was to come to an agreement with the Company
to sell certain operating assets of, or the stock of entities holding certain
operating assets of, such Practice Owner's podiatric practices (the "Letters of
Intent"). The Company has subsequently determined that its negotiations with
and deliveries of Letters of Intent to the Practice Owners may constitute an
offer to sell Common Stock inconsistent with the prospectus delivery
requirements of the Securities Act. In order to limit its potential liability
under the Securities Act (which liability the Company believes would be the
expense of defending such claim since no Practice Owner sustained damages), the
Company is undertaking this Practice Owner Rescission Offer with respect to any
potential offer made within or outside of the Letters of Intent.

EFFECTS OF THE PRACTICE OWNER RESCISSION OFFER

Practice Owners may ACCEPT the Practice Owner Rescission Offer or REJECT
the Practice Owner Rescission Offer. To the extent that a Practice Owner accepts
the Practice Owner Rescission Offer, the Company takes the position that its
potential liability based upon any possible failure of the Company to comply
with the Securities Act by negotiating and delivering the Letters of Intent
without a prospectus will be eliminated. If a Practice Owner accepts the
Practice Owner Rescission Offer, the previous Letters of Intent will be deemed
cancelled and null and void. A Practice Owner will receive no other
consideration by accepting the Practice Owner Rescission Offer. To the extent
that a Practice Owner rejects the Practice Owner Rescission Offer, he or she
will retain whatever rights he or she presently has under the Securities Act in
connection with the earlier Letter of Intent.

It is the position of the Staff of the Securities and Exchange Commission
that any liability of the Company under the Securities Act for the Practice
Offer may survive and not be barred by the Practice Owner Rescission Offer.
However, it is possible that a court would hold that the legal remedies
available to the Practice Owners are diminished as a result of the Practice
Owner Rescission Offer. Although the legal principles applicable to a
transaction such as the Practice Owner Rescission Offer are not clear, among
possible bases for such a determination are that any Practice Owners who accept
the Practice Owner Rescission Offer thereby will have entered into an accord and
satisfaction that moots any claim for damages and that any such Practice Owners
who reject the Practice Owner Rescission Offer may have waived or be estopped
from asserting his or her rights by failing to accept the Practice Owner
Rescission Offer.

STATE LAW CLAIMS

The Practice Owner Rescission Offer may have no effect on rights, if any,
of Practice Owners under applicable state securities laws; however, the Company
does not believe that any such rights, if asserted and determined adversely to
the Company, would have a material adverse effect on the Company.

PROCEDURES FOR ACCEPTING THE PRACTICE OWNER RESCISSION OFFER

For a Practice Owner to ACCEPT the Practice Owner Rescission Offer, a
properly completed section entitled "Acceptance of Practice Owner Rescission
Offer" of the Practice Owner Rescission Form, in the form to be subsequently
provided by the Company, evidencing such election must be received by the
Company prior to the expiration of the Practice Owner Rescission Offer.

A Practice Owner may REJECT the Practice Rescission Offer by properly
completing the section entitled "Rejection of Practice Owner Rescission Offer"
of the Practice Owner Rescission Form to be subsequently provided by the Company
prior to the expiration of the Practice Owner Rescission Offer. THE COMPANY WILL
REJECT THE PRACTICE OWNER RESCISSION OFFER ON BEHALF OF ANY PRACTICE OWNER WHO
FAILS TO RETURN A PROPERLY COMPLETED PRACTICE OWNER RESCISSION FORM PRIOR TO THE
EXPIRATION OF THE RESCISSION OFFER. The Practice Owner Rescission Form may be
delivered by hand, courier service, facsimile or mail to the Company to the
attention of Wayne A. Bertsch, a Senior Vice President of the Company, American
Medical Providers, Inc., 3555 Timmons Lane, Suite 1550, Houston, Texas 77027
(facsimile: (713) 621-4148). The method of delivery of all documents is at the
election of the Practice Owners. A Practice Owner Rescission Form will not be
deemed to be delivered timely to the Company if the Company does not actually
receive the Practice Owner Rescission Form prior to expiration of the Practice
Owner Rescission Offer, although the Company reserves the right in its sole
discretion to accept a Practice Owner Rescission Form subsequent to the
expiration date upon showing of proper cause.

ii
<PAGE>
NO DEALER, SALESPERSON OR ANY OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS
PROSPECTUS IN CONNECTION WITH THE OFFERING MADE BY THIS PROSPECTUS AND, IF GIVEN
OR MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING
BEEN AUTHORIZED BY THE COMPANY OR ANY UNDERWRITER. THIS PROSPECTUS DOES NOT
CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF ANY OFFER TO BUY ANY SECURITY
OTHER THAN THE SHARES OF COMMON STOCK OFFERED BY THIS PROSPECTUS, NOR DOES IT
CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY THE SHARES OF
COMMON STOCK BY ANYONE IN ANY JURISDICTION IN WHICH SUCH AN OFFER OR
SOLICITATION IS NOT AUTHORIZED, OR IN WHICH THE PERSON MAKING SUCH OFFER OR
SOLICITATION IS NOT QUALIFIED TO DO SO, OR TO ANY PERSON TO WHOM IT IS UNLAWFUL
TO MAKE SUCH OFFER OR SOLICITATION. NEITHER THE DELIVERY OF THIS PROSPECTUS NOR
ANY SALE MADE HEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION
THAT THE INFORMATION CONTAINED HEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO
THE DATE HEREOF.

------------------------

TABLE OF CONTENTS

PAGE
----
Prospectus Summary...................... 3
Risk Factors............................ 10
Use of Proceeds......................... 19
Dividend Policy......................... 20
Dilution................................ 21
Capitalization.......................... 22
Selected Financial Data................. 23
Management's Discussion and Analysis of
Financial Condition and Results of
Operations............................ 24
Business................................ 28
Management.............................. 45
Certain Transactions.................... 52
Principal Stockholders.................. 58
Description of Capital Stock............ 59
Shares Eligible for Future Sale......... 63
Underwriting............................ 64
Legal Matters........................... 65
Experts................................. 65
Additional Information.................. 65
Index to Financial Statements........... F-1

UNTIL , 1998 ALL DEALERS EFFECTING TRANSACTIONS IN THE
REGISTERED SECURITIES, WHETHER OR NOT PARTICIPATING IN THIS DISTRIBUTION, MAY BE
REQUIRED TO DELIVER A PROSPECTUS. THIS IS IN ADDITION TO THE OBLIGATION OF
DEALERS TO DELIVER A PROSPECTUS WHEN ACTING AS UNDERWRITERS AND WITH RESPECT TO
THEIR UNSOLD ALLOTMENTS ON SUBSCRIPTIONS.

AMERICAN MEDICAL
PROVIDERS, INC.

------------------------

PROSPECTUS
------------------------

, 1998
<PAGE>
NO DEALER, SALESPERSON OR ANY OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS
PROSPECTUS IN CONNECTION WITH THE OFFERING MADE BY THIS PROSPECTUS AND, IF GIVEN
OR MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING
BEEN AUTHORIZED BY THE COMPANY OR ANY UNDERWRITER. THIS PROSPECTUS DOES NOT
CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF ANY OFFER TO BUY ANY SECURITY
OTHER THAN THE SHARES OF COMMON STOCK OFFERED BY THIS PROSPECTUS, NOR DOES IT
CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY THE SHARES OF
COMMON STOCK BY ANYONE IN ANY JURISDICTION IN WHICH SUCH AN OFFER OR
SOLICITATION IS NOT AUTHORIZED, OR IN WHICH THE PERSON MAKING SUCH OFFER OR
SOLICITATION IS NOT QUALIFIED TO DO SO, OR TO ANY PERSON TO WHOM IT IS UNLAWFUL
TO MAKE SUCH OFFER OR SOLICITATION. NEITHER THE DELIVERY OF THIS PROSPECTUS NOR
ANY SALE MADE HEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION
THAT THE INFORMATION CONTAINED HEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO
THE DATE HEREOF.
------------------------

TABLE OF CONTENTS

$1,472,500 PRINCIPAL AMOUNT OF PROMISSORY NOTES
25,840 MEMBERSHIP INTERESTS

AMERICAN MEDICAL
PROVIDERS, INC.

ANKLE & FOOT CENTERS
OF AMERICA, LLC

------------------------

PROSPECTUS
------------------------

, 1998
<PAGE>
Information contained herein is subject to completion or amendment. A
registration statement relating to these securities has been filed with the
Securities and Exchange Commission. The securities offered hereby may not be
sold nor may offers to buy be accepted prior to the time the registration
statement becomes effective. This prospectus shall not constitute an offer to
sell or the solicitation of an offer to buy nor shall there be any sale of the
securities offered hereby in any state in which such offer, solicitation or sale
would be unlawful prior to registration or qualification under the securities
laws of any such state.

SUBJECT TO COMPLETION, DATED MARCH 9, 1998

3,700,000 SHARES

[AMERICAN MEDICAL PROVIDERS, INC. -- LOGO]

CLASS A COMMON STOCK

------------------------

All of the shares of class A common stock, par value $.001 per share,
offered hereby are being sold by American Medical Providers, Inc. (the
"Company" or "AMP"). Prior to the offering made hereby (the "Offering"),
there has been no public market for the class A common stock. The Company has
authorized two classes of common stock: the class A common stock, par value
$.001 per share (the "Common Stock"), and the class B common stock, par value
$.001 per share (the "Class B Common Stock"). Each holder of Common Stock is
entitled to one vote per share, and each holder of Class B Common Stock is
entitled to two-thirds ( 2/3) of a vote per share on all matters submitted to a
vote of stockholders. The Company's Bylaws authorize a Board of Directors
consisting of seven directors. Holders of Common Stock are entitled to elect as
a class six members of the Board of Directors and, subject to certain
limitations, the holders of the Class B Common Stock are entitled to elect as a
class the remaining member of the Board of Directors. Except in the election of
the Board of Directors and as required by law, holders of the Common Stock and
the Class B Common Stock vote together as a single class. Each share of Common
Stock and Class B Common Stock will share ratably in any dividends, or other
distributions, including upon the liquidation, dissolution or winding up of the
Company. See "Description of Capital Stock." It is currently estimated that
the initial public offering price will be between $10.00 and $12.00 per share.
See "Underwriting" for a discussion of the factors to be considered in
determining the initial public offering price. The Company has applied to have
the shares of Common Stock approved for quotation on the Nasdaq Stock Market
under the symbol "AMPZ." As a contingency, pending the receipt of certain
waivers to the Nasdaq Stock Market listing requirements, the Company has also
applied to have the shares of Common Stock approved for quotation on the
American Stock Exchange under the symbol "AMPZ."

The Company has filed a shelf registration statement with the Securities
and Exchange Commission relating to the separate offering of up to 2,000,000
shares of Common Stock to be used in connection with future affiliations with
Affiliated Practices (as defined herein) and providers of ancillary services and
facilities and resales of the shares issued thereunder by the recipients of such
shares.

SEE "RISK FACTORS" BEGINNING ON PAGE 10 FOR A DISCUSSION OF CERTAIN
MATTERS THAT SHOULD BE CONSIDERED BY PROSPECTIVE PURCHASERS OF THE COMMON STOCK
OFFERED HEREBY.

------------------------

THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS
THE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION
TO THE CONTRARY IS A CRIMINAL OFFENSE.

- -------------------------------------------------------------------------
- -------------------------------------------------------------------------
PRICE TO UNDERWRITING PROCEEDS TO
PUBLIC DISCOUNT(1) COMPANY(2)
- -------------------------------------------------------------------------
Per Share....... $ $ $
- -------------------------------------------------------------------------
Total(3)........ $ $ $
- -------------------------------------------------------------------------
- -------------------------------------------------------------------------

(1) The Company has agreed to indemnify the several Underwriters against certain
liabilities, including liabilities under the Securities Act of 1933, as
amended. See "Underwriting."

(2) Before deducting estimated expenses of $4,500,000 payable by the Company.

(3) The Company has granted the Underwriters a 45-day option to purchase up to
555,000 additional shares of Common Stock on the same terms and conditions
as set forth above solely to cover over-allotments, if any. If such option
is exercised in full, the total Price to Public, Underwriting Discount and
Proceeds to Company will be $ , $ , and $ ,
respectively. See "Underwriting."

------------------------

The Common Stock is offered by the several Underwriters, subject to prior
sale, when, as and if issued to and accepted by them and subject to certain
conditions. The Underwriters reserve the right to withdraw, cancel or modify
such offer or to reject any orders in whole or in part without notice. It is
expected that delivery of the shares of Common Stock will be made on or about
, 1998.

A.G. EDWARDS & SONS, INC. J.C. BRADFORD & CO.

The date of this Prospectus is , 1998
<PAGE>
46 AFFILIATED PRACTICES SERVING 57 CITIES WITH 89 OFFICES

[MAP OF LOCATIONS OF AFFILIATED PRACTICES' OFFICES]

CERTAIN PERSONS PARTICIPATING IN THE OFFERING MADE HEREBY MAY ENGAGE IN
TRANSACTIONS THAT STABILIZE, MAINTAIN OR OTHERWISE AFFECT THE PRICE OF THE
COMMON STOCK. SPECIFICALLY, THE UNDERWRITERS MAY OVER-ALLOT IN CONNECTION WITH
THIS OFFERING AND MAY BID FOR AND PURCHASE SHARES OF COMMON STOCK IN THE OPEN
MARKET. FOR A DESCRIPTION OF THESE ACTIVITIES, SEE "UNDERWRITING."

2
<PAGE>
PROSPECTUS SUMMARY

THE FOLLOWING SUMMARY IS QUALIFIED IN ITS ENTIRETY BY THE MORE DETAILED
INFORMATION AND THE FINANCIAL STATEMENTS AND NOTES THERETO APPEARING ELSEWHERE
IN THIS PROSPECTUS. UNLESS OTHERWISE INDICATED, ALL INFORMATION IN THIS
PROSPECTUS (I) ASSUMES NO EXERCISE OF THE UNDERWRITERS' OVER-ALLOTMENT OPTION,
(II) ASSUMES THE MID-POINT OF THE INITIAL PUBLIC OFFERING PRICE RANGE, (III)
ASSUMES NO EXERCISE OF ANY OUTSTANDING OPTIONS TO PURCHASE COMMON STOCK, (IV)
ASSUMES THAT THE TRANSFERS (THE "TRANSFERS") TO THE COMPANY OF THE OPERATING
ASSETS AND RECEIVABLES OR STOCK OF 46 SEPARATE PODIATRIC PRACTICES (THESE
INITIAL PRACTICES AND ANY ADDITIONAL PRACTICES TRANSFERRED ARE COLLECTIVELY
REFERRED TO AS THE "AFFILIATED PRACTICES") IN EXCHANGE FOR SHARES OF THE
COMPANY'S COMMON STOCK, CASH AND/OR THE ASSUMPTION OF CERTAIN INDEBTEDNESS HAS
OCCURRED AND (V) ASSUMES THAT THE ANESTHECARE ACQUISITION (AS DEFINED BELOW) HAS
OCCURRED. THIS PROSPECTUS CONTAINS SUMMARIES WITH RESPECT TO SELECTED TERMS OF
CERTAIN DOCUMENTS. PROSPECTIVE INVESTORS SHOULD REFER TO THE ACTUAL DOCUMENTS
SUMMARIZED THAT ARE EXHIBITS TO THE COMPANY'S REGISTRATION STATEMENT FOR
COMPLETE INFORMATION CONCERNING THE DOCUMENTS. ALL SUMMARIES HEREIN ARE
QUALIFIED IN THEIR ENTIRETY BY REFERENCE TO THE COMPLETE DOCUMENTS.

THE COMPANY

AMP was founded in August 1996 to provide practice management services and
comprehensive foot care delivery systems to podiatric practices throughout the
United States. AMP will generate revenue by providing to the Affiliated
Practices professional management, marketing expertise, equipment and facilities
often unavailable to podiatrists with small practices. The initial 46 Affiliated
Practices consist of 66 doctors of podiatric medicine ("DPMs") operating 89
offices located in 7 states serving 57 cities. The Company intends to grow
rapidly by affiliating with additional podiatric practices and by making
available to the Affiliated Practices services that are ancillary and directly
related to the Affiliated Practices' podiatric care.

The Company has entered into definitive agreements to transfer cash and
Common Stock and assume certain liabilities in exchange for stock or certain
operating assets and receivables of the Affiliated Practices simultaneous with
and as a condition to the closing of the Offering. The DPMs will join regional
group practices organized by geographic location (the "Regional Group
Practices") and will enter into physician engagement agreements with the
Regional Group Practices. AMP will enter into a long-term management agreement
with each Regional Group Practice under which AMP will receive fees for its
services. The Company will own the operating assets and receivables of the
Affiliated Practices, hire the non-physician employees, and otherwise assume the
management of each practice. The initial Affiliated Practices were selected
based upon their location, size, historical profitability and growth and
reputation for high quality care. Based on management's knowledge of the U.S.
podiatric industry gained from conversations with DPMs, surveys of the size of
other podiatric practice management companies, affiliations and groups, and
general industry research, management believes that the initial Affiliated
Practices are leading podiatric practices in their respective markets and that,
following the Transactions (as defined herein), AMP will be the largest provider
of comprehensive podiatric practice management services in the United States.

A key element of the Company's strategy is to provide ancillary services
and facilities to the Affiliated Practices. These ancillary services and
facilities are expected to include, among other things, ambulatory surgical
centers, anesthesiology, pathology, radiology, MRIs, EKGs, laboratory work,
pharmacy, physical history and exams, physical therapy, orthotics, pain
management, home care, diabetic wound care, specialty shoes and other retail
products. The Company intends to make available some or all of these ancillary
services on a regional basis. The Affiliated Practices in each region will
primarily or exclusively use AMP's ancillary services, enabling the Company to
control the cost, quality and other important aspects of these services.
Pursuant to this strategy, AMP has entered into a definitive agreement to
purchase certain assets (including the name "AnestheCare, Inc.") of Pyramid
Anesthesiology Group, Inc. (the "AnestheCare Acquisition"), an anesthesiology
management services organization currently servicing 15 locations in
metropolitan Atlanta, Georgia ("AnestheCare"). AnestheCare's current
operations and ongoing business

3
<PAGE>
relationships will continue after the AnestheCare Acquisition. In addition,
after the acquisition, AnestheCare will provide anesthesiology management
services to certain of the Regional Group Practices. The Company is also
acquiring Bellaire Surgicare, Inc. and Clayton Outpatient Surgical Center, Inc.
(the "Ambulatory Surgery Center Acquisitions"), which own surgical centers.

Podiatry is the practice of medicine whereby DPMs provide preventative,
diagnostic, surgical and other foot care to patients. Podiatric care ranges from
relatively simple procedures, such as treating foot infections, to complex
surgeries, such as reconstructing the bones in the foot. Today, there are
approximately 10,700 active DPMs throughout the United States handling 55
million patient visits per year. According to the American Podiatric Medical
Association, billing receipts of all DPMs in the United States increased to
approximately $2.3 billion in 1995 from approximately $1.3 billion in 1987, a
compound annual growth rate of 7.7%.

AMP's objective is to be the nation's leading provider of management
services and comprehensive foot care delivery systems to podiatric practices. To
achieve its objective, AMP will employ the following operating strategies: (i)
enhance quality of DPM patient care, (ii) achieve operational efficiencies,
(iii) develop Regional Group Practice structure, (iv) provide effective
marketing, and (v) implement comprehensive foot care delivery systems. AMP
intends to grow rapidly by: (i) growing Affiliated Practices, (ii) developing
ancillary provider networks, and (iii) affiliating with new practices.

THE TRANSACTIONS

Of the 46 Transfers of the initial Affiliated Practices, 45 will be
accounted for by the Company under SEC Staff Accounting Bulletin No. 48,
"Transfers of Non-Monetary Assets by Promoters or Shareholders" ("SAB 48"),
such that the non-monetary assets of these initial Affiliated Practices will be
received by the Company at the transferor's historical cost basis for accounting
purposes. Following the SAB 48 transactions and the consummation of the
offering, AMP will consummate the AnestheCare Acquisition and AMP or a
subsidiary will acquire the stock of Dr. Jerald N. Kramer, D.P.M., P.C., one of
its Affiliated Practices (the "Kramer Transfer", and together with the other
Transfers and the AnestheCare Acquisition, the "Transactions"). Dr. Kramer
will receive cash in exchange for stock acquired by the Company in the Kramer
Transfer, but Dr. Kramer will not enter into a management services agreement or
a physician engagement agreement with a Regional Group Practice. The Ambulatory
Surgery Center Acquisitions included in the Transfers, the AnestheCare
Acquisition and the Kramer Transfer will not be accounted for under SAB 48.
Instead, these and all future individual practice affiliations will be accounted
for as purchases at fair market value and are expected to result in purchase
prices in excess of net assets acquired (goodwill) which will require subsequent
noncash amortization charges for intangible assets in the Company's statements
of operations.

The aggregate consideration to be paid by the Company in the Transfers is
approximately $34.5 million, consisting of (i) approximately $18.3 million
payable in shares of Common Stock at the initial public offering price
attributed to the net non-monetary assets, (ii) approximately $4.7 million in
cash and approximately $156,000 of assumed indebtedness attributed to the net
non-monetary assets of the SAB 48 Transfers, (iii) $4.3 million in cash
attributed to the net monetary assets of the SAB 48 Transfers, (iv)
approximately $4.1 million payable in shares of Common Stock at the initial
public offering price, approximately $1.0 million in cash, approximately
$500,000 of assumed indebtedness attributed to the Ambulatory Surgery Center
Acquisitions which are included in the Transfers but not accounted for under SAB
48, and (v) approximately $1.4 million in cash attributed to the Kramer
Transfer. The consideration to be paid by the Company to AnestheCare is
approximately $4.5 million in cash. Additional consideration of up to $1.5
million in cash and a number of shares of Common Stock equal to $500,000 valued
at the initial public offering price will be held in escrow and may be paid to
the owners of AnestheCare pending AnestheCare's achievement of certain
performance targets over a three-year period beginning January 1, 1998. Proceeds
from the Offering will be used to pay the cash portion of the consideration.

4
<PAGE>
SHELF REGISTRATION

The Company may use shares subject to its shelf registration statement
filed with the Securities and Exchange Commission (the "Commission") relating
to the separate offering of up to 2,000,000 shares of Common Stock (the "Shelf
Registration") to acquire certain operating assets of, or the stock of entities
holding certain operating assets of, additional Affiliated Practices and
providers of ancillary services and facilities, and to enter into management
services agreements with these entities.

The Company's principal executive offices are located at 3555 Timmons Lane,
Suite 1550, Houston, Texas 77027, and its telephone number is (713) 621-5500.

5
<PAGE>
THE OFFERING

<TABLE>
<CAPTION>
<S> <C>
Common Stock offered by the Company..... 3,700,000 shares

Common Stock to be outstanding after the
Offering.............................. 5,778,322 shares(1)

Class B Common Stock to be outstanding
after the Offering.................... 650,000 shares(2)

Voting rights........................... Holders of Common Stock of the Company are entitled to one vote per share
and the holders of Class B Common Stock of the Company are entitled to
two-thirds ( 2/3) of a vote per share. The Company's Bylaws authorize a
Board of Directors consisting of seven directors. Holders of Common Stock
are entitled to elect as a class six members of the Board of Directors and
the holders of the Class B Common Stock are entitled to elect as a class
the remaining member of the Board of Directors; provided however, that if
65% or more of the Class B Common Stock outstanding on the date of this
Prospectus has been converted into Common Stock, the Class B Common Stock
shall no longer have the ability to elect a director as a class. The Common
Stock and Class B Common Stock possess ordinary voting rights and vote
together as a single class in respect of all other corporate matters. See
"Description of Capital Stock."

Conversion of the Class B Common
Stock................................. CONVERSION RATIO. The Class B Common Stock is convertible into Common
Stock, at the option of the holder thereof, upon the occurrence of a
Conversion Event (as defined below). The maximum number of shares of Common
Stock that may be issued upon conversion of the Class B Common Stock is
1,950,000. The Class B Common Stock converts into Class A Common Stock on a
share-for-share basis, provided however, that if the Common Stock reaches
certain average closing prices over 15 consecutive trading days during the
next six years on the Nasdaq National Market, other over-the-counter market
or an exchange, as then applicable (the "Trading Market"), then, as set
forth below, the conversion ratio with respect to a certain number of
shares of Class B Common Stock will immediately change so that such shares
will thereafter be convertible into Common Stock at the ratio of three
shares of Common Stock for each share of Class B Common Stock (each such
share an "Adjusted Conversion Share").

CONVERSION ADJUSTMENT. On the date that the average closing price on the
Trading Market for the preceding 15 consecutive trading days (the "Average
Price") exceeds 150% of the price to the public in the Offering, 130,000
of the issued shares of Class B Common Stock will immediately become
Adjusted Conversion Shares (and subject to the new 3-for-1 conversion
ratio). Thereafter, the remaining 520,000 shares of Class B Common Stock
will become Adjusted Conversion Shares in four remaining increments of
130,000 shares of Class B

6
<PAGE>
Common Stock each (20% of the total number of shares of Class B Common
Stock issued) upon the attainment of new Average Prices. The Average Prices
applicable to each new 20% increment will equal 120% of each immediately
preceding Average Price applicable to the preceding 20% increment.
Therefore, the five Average Prices at which each of the five total
increments shall automatically become Adjusted Conversion Shares are
$16.50, $19.80, $23.76, $28.51 and $34.21, respectively, based upon the
initial assumed offering price of $11.00 per share. Upon a Conversion
Event, each holder of Class B Common Stock will have the right to have each
share of Class B Common Stock converted into that number of shares of
Common Stock as each such share is entitled to based upon the Average
Prices achieved, if any. Any additional Average Price attained after the
occurrence of a Conversion Event will continue to act to create Adjusted
Conversion Shares, as applicable. If any shares of Class B Common Stock are
outstanding on the sixth anniversary of this Prospectus, such shares will
automatically convert into a number of shares of Common Stock based upon
the conversion ratio then applicable for such shares. Thus, on such
anniversary if a portion of the shares of Class B Common Stock have become
Adjusted Conversion Shares and a portion of the shares of Class B Common
Stock are not Adjusted Conversion Shares, the Adjusted Conversion Shares
shall be converted on a three-for-one basis and the non-Adjusted Conversion
Shares shall be converted on a one-for-one basis. Shares of Class B Common
Stock held by a holder shall automatically convert into Common Stock
immediately prior to the disposition of such shares of Class B Common Stock
by such holder.

CONVERSION EVENTS. A Conversion Event shall be deemed to have occurred (i)
in the event of a disposition of such share of Class B Common Stock by the
holder thereof (excluding dispositions to such holder's affiliates), (ii)
in the event any person not affiliated with the Company acquires beneficial
ownership of 15% or more of the outstanding shares of capital stock of the
Company, (iii) in the event any person not affiliated with the Company
offers to acquire 15% or more of the outstanding shares of capital stock of
the Company, (iv) in the event the holder of such shares elects to so
convert at any time after the second anniversary of the date of this
Prospectus, (v) on the sixth anniversary of the date of this Prospectus, or
(vi) in the event the holders of a majority of the outstanding shares of
Common Stock approve such conversion. In addition, the Company may elect to
convert any outstanding shares of Class B Common Stock into shares of
Common Stock in the event 95% or more of the outstanding shares of Class B
Common Stock as of the date of this Prospectus have previously been
converted into shares of Common Stock.

Use of proceeds......................... To fund the cash portion of the consideration to be paid in the
Transactions; to repay certain indebtedness and deferred expenses of the
Company; to complete the purchase of the Company's management information
system; and for general corporate purposes, which

7
<PAGE>
are expected to include (among other things) future transfers of DPM
practices and certain development costs of ancillary services. See "Use of
Proceeds."

Proposed Nasdaq National Market
symbol(3)............................. "AMPZ"
</TABLE>

- ------------

(1) Includes 2,078,332 shares of Common Stock issued in connection with the
Transactions, but excludes 464,500 shares of Common Stock issuable upon
exercise of outstanding options issued pursuant to the Company's 1997
Incentive and Non-Qualified Stock Option Plan to purchase Common Stock at
the initial public offering price and 555,000 shares of Common Stock
issuable upon exercise of the Underwriters' over-allotment option. The
actual number of shares issued in connection with the Transactions will be
determined by dividing $22,861,652 by the initial public offering price. In
the event the price to the public is higher than the mid-point of the
estimated initial public offering price range, the aggregate number of
shares will be reduced accordingly, and in the event the price to the public
is lower, the aggregate number of shares will be increased accordingly. See
"Management -- Incentive and Non-Qualified Stock Option Plan" and
"Certain Transactions -- Affiliated Practices."

(2) The Class B Common Stock may be convertible into an aggregate of 1,950,000
shares of Common Stock. See "The Offering -- Conversion of Class B Common
Stock."

(3) As a contingency, pending the receipt of certain waivers to the Nasdaq Stock
Market listing requirements, the Company has also applied to have the shares
of Common Stock approved for quotation on the American Stock Exchange under
the symbol "AMPZ."

FORWARD-LOOKING STATEMENTS

CERTAIN STATEMENTS CONTAINED IN THIS PROSPECTUS, INCLUDING STATEMENTS
CONTAINING THE WORDS "BELIEVES," "ANTICIPATES," "INTENDS," "EXPECTS" AND
WORDS OF SIMILAR IMPORT, CONSTITUTE "FORWARD-LOOKING STATEMENTS." THESE
FORWARD-LOOKING STATEMENTS INVOLVE KNOWN AND UNKNOWN RISKS, UNCERTAINTIES AND
OTHER FACTORS THAT MAY CAUSE THE ACTUAL RESULTS, PERFORMANCE OR ACHIEVEMENTS OF
THE COMPANY OR ITS INDUSTRY TO BE MATERIALLY DIFFERENT FROM ANY FUTURE RESULTS,
PERFORMANCE OR ACHIEVEMENTS EXPRESSED OR IMPLIED BY THESE FORWARD-LOOKING
STATEMENTS.

THESE RISK FACTORS INCLUDE, AMONG OTHERS, THE LIMITED COMPANY AND COMBINED
OPERATING HISTORY, DEPENDENCE ON CERTAIN OPERATIVE AGREEMENTS, DEPENDENCE ON
REGIONAL GROUP PRACTICES, DEPENDENCE ON IMPLEMENTATION AND INTEGRATION OF
INFORMATION SYSTEMS, DEPENDENCE UPON KEY PERSONNEL, DEPENDENCE ON IMPLEMENTATION
OF GROWTH STRATEGY, MOVEMENT TOWARD MANAGED CARE, CHANGES IN PAYMENT FOR MEDICAL
SERVICES, POTENTIAL ADVERSE CONSEQUENCES OF GOVERNMENT REGULATION, FUTURE HEALTH
CARE REFORM, COMPETITION, NEED FOR ADDITIONAL FUNDS, LIABILITY AND INSURANCE
RISKS ASSOCIATED WITH PODIATRIC PRACTICES, NO PRIOR PUBLIC MARKET FOR THE COMMON
STOCK, THE NUMBER OF SHARES ELIGIBLE FOR FUTURE SALE, SUBSTANTIAL PROCEEDS OF
THE OFFERING PAYABLE TO AFFILIATED PRACTICES AND AFFILIATES, CONTROL BY EXISTING
MANAGEMENT AND STOCKHOLDERS, CERTAIN ANTI-TAKEOVER PROVISIONS IN THE COMPANY'S
ARTICLES AND BYLAWS, IMMEDIATE AND SUBSTANTIAL DILUTION TO INVESTORS IN THE
COMMON STOCK, NO INTENT TO PAY DIVIDENDS, AND OTHER FACTORS REFERENCED IN THIS
PROSPECTUS. CERTAIN OF THESE FACTORS ARE DISCUSSED IN MORE DETAIL ELSEWHERE IN
THIS PROSPECTUS, INCLUDING UNDER THE CAPTIONS "PROSPECTUS SUMMARY" AND "RISK
FACTORS." GIVEN THESE UNCERTAINTIES, POTENTIAL INVESTORS ARE CAUTIONED NOT TO
PLACE UNDUE RELIANCE ON THESE FORWARD-LOOKING STATEMENTS. THE COMPANY DISCLAIMS
ANY OBLIGATION TO UPDATE ANY OF THESE FACTORS OR TO PUBLICLY ANNOUNCE THE RESULT
OF ANY REVISIONS TO ANY OF THE FORWARD-LOOKING STATEMENTS CONTAINED HEREIN TO
REFLECT FUTURE EVENTS OR DEVELOPMENTS.

8
<PAGE>
SUMMARY FINANCIAL DATA

THE FOLLOWING INFORMATION IS DERIVED FROM THE FINANCIAL STATEMENTS OF THE
COMPANY INCLUDED ELSEWHERE IN THIS PROSPECTUS. EXCEPT AS INDICATED, THIS
INFORMATION DOES NOT REFLECT THE EFFECTS OF THE TRANSACTIONS OR THE OFFERING.
FOR CERTAIN INFORMATION CONCERNING THE TRANSACTIONS, SEE NOTE 5 OF NOTES TO
FINANCIAL STATEMENTS OF THE COMPANY AND UNAUDITED PRO FORMA COMBINED BALANCE
SHEET AND THE NOTES THERETO.

<TABLE>
<CAPTION>
PERIOD FROM
INCEPTION (AUGUST FOR THE
9, 1996) TO YEAR ENDED
DECEMBER 31, 1996 DECEMBER 31, 1997
----------------- ------------------
<S> <C> <C>
STATEMENT OF OPERATIONS DATA(1):
Revenues................................ $ -- $ --
Expenses................................ 1,436,441 2,706,255
----------------- ------------------
Net loss................................ $(1,436,441) $ (2,706,255)
================= ==================
</TABLE>
DECEMBER 31, 1997
------------------------------
HISTORICAL AS ADJUSTED(2)
-------------- --------------
(UNAUDITED)
BALANCE SHEET DATA:
Cash and cash equivalents............... $ -- $ 12,890,000
Working capital (deficit)(3)............ (3,117,512) 15,986,000
Total assets(4)......................... 4,194,238 30,130,000
Long-term debt.......................... -- 656,000
Stockholders' equity (deficit).......... (2,610,677) 28,508,000

- ------------

(1) The Company has conducted no significant on-going, non-developmental
business operations to date and will not conduct significant business
operations until the affiliation of the Company with the initial Affiliated
Practices and the Offering are completed. Pursuant to a reimbursement and
assumption agreement (the "Reimbursement and Assumption Agreement") dated
January 20, 1998 between the Company and AFC, the Company will reimburse the
affiliation-related expenses incurred by AFC since May 1996, including AFC's
payroll, travel and entertainment, office equipment and professional fees.
AFC currently holds 365,625 shares of Class B Common Stock which management
plans to distribute to AFC members approximately 180 days after consummation
of the Offering.

(2) As adjusted gives effect to the Transactions, the sale of 3,700,000 shares
of Common Stock offered by the Company, and the application of the estimated
net proceeds therefrom. See "Use of Proceeds."

(3) The historical balance includes $4.0 million due to AFC as of December 31,
1997, which will be repaid upon consummation of the Offering. The Company
expects this amount due to AFC to be approximately $6.0 million upon the
anticipated closing date of the Offering.

(4) The Company will record the non-monetary assets transferred to the Company
in connection with the Transfers, excluding the Ambulatory Surgery Center
Acquisitions and the Kramer Transfer, at the historical cost basis of the
transferors. Monetary assets transferred as well as the AnestheCare
Acquisition, the Kramer Transfer and the Ambulatory Surgery Center
Acquisitions will be accounted for in a method similar to purchase
accounting.

<PAGE>
RISK FACTORS

AN INVESTMENT IN THE SHARES OF COMMON STOCK OFFERED HEREBY INVOLVES A HIGH
DEGREE OF RISK. A PROSPECTIVE INVESTOR SHOULD CAREFULLY CONSIDER ALL OF THE
INFORMATION CONTAINED IN THIS PROSPECTUS BEFORE DECIDING WHETHER TO PURCHASE THE
COMMON STOCK OFFERED HEREBY AND, IN PARTICULAR, THE FOLLOWING FACTORS:

LIMITED COMPANY AND COMBINED OPERATING HISTORY. The Company was
incorporated in August 1996 and has no history of operations or earnings.
Certain members of the Company's management group have been assembled recently.
As a result of the Transfers, certain members of AMP expect to be responsible
for the management of all non-medical aspects of the operations and all
non-physician employees of the initial Affiliated Practices. There can be no
assurance that such persons will be able to effectively manage the initial
Affiliated Practices or oversee the implementation of the Company's operating,
growth and business strategies. Further, there can be no assurance that
management will be able to operate the Company successfully, manage the initial
Affiliated Practices' operations, achieve any cost savings as a result of the
Transactions or institute the necessary systems and procedures to manage the
Company on a profitable basis. The inability of the Company to successfully
integrate or operate the Affiliated Practices could have a material adverse
effect on the Company's business, financial condition and results of operations
and make it unlikely that the Company's affiliations with the Affiliated
Practices will be successful.

Prior to the Offering, the initial Affiliated Practices were not under
common control or management and have operated as separate, independent
entities. As a result, the financial results of the respective initial
Affiliated Practices prior to the Offering will not necessarily be similar to
the results of the initial Affiliated Practices after the Offering. The Company
may experience delays, complications and expenses in implementing, integrating
and operating such initial Affiliated Practices, any of which could have a
material adverse effect on the Company's business, financial condition and
results of operations.

DEPENDENCE ON OPERATIVE AGREEMENTS. To effect AMP's affiliation with the
Affiliated Practices, the following agreements have been entered into or will be
entered into (collectively, the "Operative Agreements"): (i) Business Purchase
Agreements and/or Stock Purchase Agreements by and between the Affiliated
Practices and the Company; (ii) Management Agreements by and between the
Regional Group Practices and the Company; (iii) Physician Engagement Agreements
by and between the Regional Group Practices and each owner of an Affiliated
Practice; and (iv) employment agreements between the Regional Group Practices
and each non-owner DPM. The consummation of the affiliations with the Affiliated
Practices and the subsequent viability of the Company are dependent on the
initial and continuing enforceability of the Operative Agreements. While the
Company has attempted to structure the Operative Agreements in accordance with
applicable law, there can be no assurance that the enforceability of certain
non-compete and other provisions contained in the Operative Agreements will not
be successfully challenged. Further, because each of the Physician Engagement
Agreements is between a Regional Group Practice and an owner of the Affiliated
Practices, there can be no assurance that the parties thereto will not terminate
or amend the terms and conditions of such agreements. See "Business -- Purchase
Agreements," " -- Management Agreements" and " -- Physician Engagement
Agreements."

DEPENDENCE ON REGIONAL GROUP PRACTICES. The Company's operations will be
entirely dependent upon its continued ability to negotiate and enter into
management services agreements (the "Management Agreements") with Regional
Group Practices and upon the success of such practices. The Company expects to
receive management fees for services provided to Regional Group Practices under
the Management Agreements, but will not employ podiatrists or control or own the
medical practice of Regional Group Practices. The Management Agreements have
40-year terms but are subject to prior termination by the Regional Group
Practice or the Company for, among other things, a default in the performance of
a material duty or obligation. There can be no assurance that the initial
Regional Group Practices will maintain successful practices, that Management
Agreements will not be terminated or that any of the key DPMs in a particular
Regional Group Practice will continue affiliation with any Regional Group
Practice. In addition, if the service fee varies by more than 5% over or under
the adjusted service fee (as defined), then the service fee may be adjusted
quarterly upon the mutual agreement of the Regional Group Practice and the
Company,

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on a prospective basis only, (without a floor or ceiling on the adjustment) to
reflect the fair value of the management services provided. See "Management's
Discussion and Analysis of Financial Condition and Results of
Operations -- Overview." Any termination of such Management Agreements or
affiliation, the inability of the Regional Group Practices to generate
sufficient patient revenue, or the downward adjustment of management fees to
reflect the fair value of services provided by the Company could have a material
adverse effect on the Company's business, financial condition and results of
operations.

Some of the initial Regional Group Practices will derive, and any
additional Regional Group Practices may derive, a significant portion of their
revenue from a limited number of DPMs. Particularly, because none of the DPMs in
the initial Regional Group Practices will have previously entered into
management arrangements similar to those embodied in the Company's Management
Agreements, there can be no assurance that the Company or the Regional Group
Practices will maintain cooperative relationships with these key DPMs. In
addition, there can be no assurance that key members of a Regional Group
Practice will not retire, become disabled or otherwise become unable or
unwilling to continue practicing their profession with a Regional Group
Practice. The loss by a Regional Group Practice of one or more key members would
have a material adverse effect on the revenue of such Regional Group Practice
and, thus, on the Company. The material loss of revenue by any Regional Group
Practice could have a material adverse effect on AMP.

Rates paid by private third party payors, including those that provide
Medicare supplemental insurance, are based on established health care provider
and hospital charges and are generally higher than Medicare payment rates. A
change in the patient mix of any Regional Group Practice that results in a
decrease in patients covered by private insurance could have a material adverse
effect on the Regional Group Practice and, as a result, on the Company.

DEPENDENCE ON IMPLEMENTATION AND INTEGRATION OF INFORMATION SYSTEMS. A key
element in the Company's business strategy is implementing new sophisticated
management information systems. The Company expects to have these systems
operating at the time of the Offering to perform billing and collection services
for all Affiliated Practices and to complete hardware and software deployment of
the systems to most Affiliated Practices within approximately 90 days after the
Offering. The Company's success is dependent upon its ability, within a
reasonable period of time, to implement its new management information systems
and to integrate these systems into the initial Regional Group Practices' and
the Affiliated Practices' existing operational, financial and clinical
information systems. In addition to their integral role in helping the Regional
Group Practices realize operating efficiencies, these systems are critical to
negotiating, pricing and managing managed care contracts. The Company will need
to continue to invest in and administer sophisticated management information
systems to support these activities. AMP may experience unanticipated delays,
complications and expenses in implementing, integrating and operating these
systems. Furthermore, these systems may require modifications, improvements or
replacements as the Company expands or if new technologies become available.
These modifications, improvements or replacements may require substantial
expenditures and may require interruptions in operations during periods of
implementation. The Company's failure to successfully implement and maintain
operational, financial and clinical information systems on a timely basis would
have a material adverse effect on the Company's business, financial condition
and results of operations.

DEPENDENCE UPON KEY PERSONNEL. The Company is highly dependent upon its
three executive officers, Jack McCrary, Wayne Bertsch, and Randy Johnson, and
other key personnel, for the management of the Company, the Affiliated Practices
and the implementation of its business strategy. The Company has entered into
employment contracts and non-compete agreements with these executive officers
and others. Due to the likely difficulty in finding suitable replacements for
these individuals, the loss of the services of any of these persons or the
Company's inability in the future to attract and retain management or other key
personnel could have a material adverse effect on the Company. AMP does not have
key man insurance for any of its executive officers or other key personnel.

DEPENDENCE ON IMPLEMENTATION OF GROWTH STRATEGY. One of the Company's
principal strategies is to acquire the operating assets and receivables or stock
of certain Affiliated Practices in targeted markets which meet its affiliation
criteria and to enter into management services contracts with the Regional Group

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<PAGE>
Practices. The Company's growth strategy also involves expanding the Affiliated
Practices and, to the extent permitted by applicable law, contracting with or
acquiring ancillary facilities and providers, to provide services such as
ambulatory surgical centers, anesthesiology, pathology, radiology, MRIs, EKGs,
laboratory work, pharmacy, physical history and exams, physical therapy,
orthotics, pain management, home care, diabetic wound care, specialty shoes and
other related retail products. The process of (i) identifying appropriate DPM
group practices, DPMs and ancillary providers and facilities and (ii) proposing,
negotiating and implementing economically attractive affiliations with them is
lengthy, complex and costly. The failure of the Company to identify and effect
additional practice affiliations would have a material adverse effect on the
Company. Moreover, there can be no assurance that future practice affiliations,
if any, will contribute to the Company's profitability. Further, such
arrangements involve a number of risks, including diversion of management's
attention, dependence on hiring, training and retaining key personnel, and risks
associated with the assumption of certain contingent legal liabilities, some or
all of which could have a material adverse effect on the Company's business,
financial condition and results of operations. In addition, there can be no
assurance that the Affiliated Practices will achieve anticipated revenues and
earnings or that suitable additional practice affiliations can be accomplished
on terms favorable to the Company or that financing, if necessary, can be
obtained for such affiliations.

The Company's ability to implement its growth strategy is also dependent
upon the Company's and the Regional Group Practices' ability to (i) adapt the
Company's arrangements with the Regional Group Practices to comply with current
and future legal requirements, including state prohibitions on (a) fee-
splitting, (b) corporate practice of medicine, (c) referrals to facilities in
which physicians have a financial interest, and (d) kickbacks, (ii) obtain
regulatory approvals and certificates of need, where necessary, and (iii) comply
with licensing requirements applicable to physicians and to facilities operated,
and services offered, by physicians. There can be no assurance that application
of current laws or changes in legal requirements will not adversely affect the
Company or that the Company or its Regional Group Practices will be able to
obtain and maintain all necessary regulatory approvals and comply with
applicable laws, regulations and licensing requirements.

AMP is highly dependent upon the revenue stream, in the form of management
fees, that it expects to receive under the Management Agreements. In addition,
AMP will pay the existing liabilities of certain Affiliated Practices in
connection with the Transfers. Failure by the Regional Group Practices to
generate sufficient management fees to permit AMP to pay such liabilities could
have a material adverse effect on AMP's business, financial condition and
results of operations. In addition, failure by the Regional Group Practices to
calculate or pay the management fees required, whether by mistake, fraud or
otherwise, would have a material adverse effect on AMP.

In addition, AMP expects to make loans to the Regional Group Practices to
enable them to make loans to certain DPM owners in Affiliated Practices after
the date of this Offering in order to assist them in temporarily replacing any
earnings reductions incurred as a result of the Transfers. Such loans will not
affect the calculation and payment of the management fee and all rights and
claims by the Company with respect to its management fees and loans made by the
Company to the Regional Group Practices and/or owner DPMs on behalf of the
Regional Group Practices will be secured by a perfected first lien security
interest in the accounts receivable of the Regional Group Practices. The loans
to each of the owner DPMs will be limited to an amount equal to (i) an advance
on the first monthly draw of such DPM, (ii) the difference between 90% of the
average monthly compensation of such DPM in the year prior to the Offering and
the current period's levels of distributions from the practice for the first
three months after the Offering, and (iii) the difference between 80% of the
average monthly compensation of such DPM in the year prior to the Offering and
the current period's level of distributions for the second three months after
the Offering. The loans will only be available to owner DPMs for the first six
months of the DPM's engagement by the Regional Group Practice. Funds advanced by
the Company to the Regional Group Practices to make such loans are required to
be repaid to the Company by the Regional Group Practice although there can be no
assurance such owner DPMs will repay any such loans or that the Regional Group
Practices will be able to repay funds advanced by the Company. See Unaudited Pro
Forma Combined

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<PAGE>
Balance Sheet and the Notes thereto, "Certain Transactions," "Management's
Discussion and Analysis of Financial Condition and Results of Operations" and
"Management."

MOVEMENT TOWARD MANAGED CARE. An increasing percentage of patients have
entered into health care coverage arrangements with managed care payors in
recent years. AMP believes that its success will be dependent upon its ability
to negotiate contracts on behalf of the Regional Group Practices with HMOs,
employer groups and other private third party payors. Many such managed care or
other third party payors already have existing provider structures in place and
may not be able or willing to change their provider networks. Managed care and
third party payors have established primary care providers who often have
considerable discretion over who delivers various medical services, including
the provision of podiatric services. Many such third party payors do not
recognize DPMs as primary care providers. Therefore, many non-DPM physicians,
acting as primary care providers, may elect to (i) perform podiatric services
themselves, (ii) contract with other podiatrists or podiatric practices which
are not Affiliated Practices, or (iii) contract with other providers, such as
orthopedists. The inability of AMP to establish or maintain arrangements on
behalf of the Regional Group Practices with third party providers could have a
material adverse effect on the Company.

CHANGES IN PAYMENT FOR MEDICAL SERVICES. The Company anticipates that the
Regional Group Practices will be licensed under applicable state law and
certified as providers under the federal Medicare program and state Medicaid
programs. These programs are highly regulated and subject to frequent and
substantial changes. In recent years, basic changes in Medicare reimbursement
programs have resulted, and are expected to continue to result, in reduced
levels of reimbursement for individuals covered by these programs. Changes in
Medicare and Medicaid reimbursement rates, policies or practices could adversely
affect the Company.

In certain instances, AMP may seek to negotiate special fee arrangements
with respect to third party payors on behalf of regional podiatric care networks
consisting of Regional Group Practices affiliated with the Company and other
physicians or group practices willing to permit the Company to negotiate on
their behalf. In these instances, the Company expects that future payor
contracts entered into on behalf of the Regional Group Practices and any related
physician networks may include capitated fee arrangements. Under these types of
contracts, a health care provider agrees either to accept a predetermined dollar
amount per member per month in exchange for undertaking to provide all covered
services to patients or to provide treatment on an episode-of-care basis. These
health care providers bear the risk, generally subject to certain loss limits,
that the aggregate costs of providing medical services will exceed the premiums
received. In these instances, agreements may also contain "shared risk"
provisions under which affiliated physicians may earn additional compensation
based on utilization control of institutional, ancillary and other services by
patients, and the Regional Group Practices may be required to bear a portion of
any loss in connection with these "shared risk" provisions. To the extent that
patients or enrollees covered by these contracts require more frequent or more
extensive care than anticipated, there could be a material adverse effect on a
Regional Group Practice and, therefore, on the Company. Any material reduction
or elimination of earnings to the Regional Group Practices could have a material
adverse effect on the Company.

If, as a result of special fee arrangements that the Company may negotiate
on behalf of the Regional Group Practices or may enter into in the future with
third-party payors, the Company is deemed to assume certain risks related to the
cost of services provided in connection with capitated fee arrangements,
episode-of-care treatment, shared risk agreements or the like, the Company could
be viewed by federal or state regulatory authorities to be engaged in the
business of insurance. If so, the Company might be required to obtain a license
to act as an insurer in certain states and to restructure some or all of its
operations to comply with the insurance laws of certain states.

POTENTIAL ADVERSE CONSEQUENCES OF GOVERNMENT REGULATION. The delivery of
podiatric care services and health care generally are subject to extensive
federal and state regulation. The Company believes that its operations are and
will be conducted in material compliance with applicable laws. However, the
Company has not received or applied for an opinion from any federal or state
judicial or regulatory authority to this effect, and many aspects of the
Company's business operations to date have not

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<PAGE>
been the subject of state or federal regulatory interpretation. There can be no
assurance that a review of AMP's operations by federal or state judicial or
regulatory authorities will not result in a determination that AMP or one or
more of its Regional Group Practices have violated one or more provisions of
federal or state law. Any such determination could have a material adverse
effect on the Company.

The fraud and abuse provisions of the Social Security Act and anti-kickback
laws and regulations adopted by many states prohibit the solicitation, payment,
receipt or offering of any direct or indirect remuneration in return for, or as
an inducement to, certain referrals of patients, items or services. Provisions
of the Social Security Act impose significant penalties for false or improper
billings for services reimbursable by Medicare, Medicaid or other
federally-funded programs. In addition, the Stark amendments to the Social
Security Act impose specific restrictions on physicians' referrals for
designated health services reimbursable by Medicare, Medicaid or other
federally-funded programs to entities with which the physicians have financial
relationships. The federal government has also recently extended its statutory
prohibitions to include the relationship between health care providers and any
health care benefit programs, including non-governmental health care programs
(such as HMOs, PPOs or standard indemnity insurance).

Violations of any of these laws may result in substantial civil or criminal
penalties, including large civil monetary penalties and, in the case of
violations of certain federal laws, exclusion from participation in the
Medicare, Medicaid or other federally-funded programs. Such exclusion and
penalties, if applied to the Company or the Regional Group Practices, would have
a material adverse effect on the Company.

The laws of many states prohibit business corporations, such as the
Company, from practicing medicine or exercising control over the medical
judgments or decisions of physicians and from engaging in certain financial
arrangements, such as splitting fees with physicians. These laws and their
interpretations vary from state to state and are enforced by both the courts and
regulatory authorities, each with broad discretion. Violations of these laws
could result in censure or the revocation of the license of affiliated
physicians, civil or criminal penalties, including large civil monetary
penalties, or other sanctions. In addition, a determination in any state that
AMP is engaged in the corporate practice of medicine or any unlawful
fee-splitting arrangement could render any Management Agreement between AMP and
a Regional Group Practice located in such state unenforceable or subject to
modification, which could have a material adverse effect on AMP.

Expansion of the Company's operations into certain jurisdictions may
require modification of the Company's form of relationship with its Regional
Group Practices, which could have a material adverse effect on the Company.
Furthermore, the Company's ability to expand into, or to continue to operate
within, certain jurisdictions may depend on the Company's ability to modify its
operational structure to conform to such jurisdictions' regulatory framework or
to obtain necessary approvals, licenses and permits. Any such limitation on the
Company's ability to expand could have a material adverse effect on the Company.
See "Business -- Government Regulations."

FUTURE HEALTH CARE REFORM. In addition to extensive existing government
health care regulation, there are numerous initiatives on the federal and state
levels for comprehensive reforms affecting the payment for and availability of
health care services. These initiatives include reductions in Medicare and
Medicaid payments, trends in adopting managed care for Medicare and Medicaid
patients, regulation of entities that provide managed care and additional
prohibitions on ownership by health care providers, directly or indirectly, of
facilities to which they refer patients. It is uncertain what legislative
proposals will be adopted in the future or what actions federal or state
legislators or third party payors may take in anticipation of or in response to
any health care reform proposals or legislation. Aspects of certain of these
health care proposals, if adopted, could have a material adverse effect on the
Company.

COMPETITION. The business of providing podiatric services is highly
competitive in each of the Company's markets. The Company believes that changes
in governmental and private reimbursement policies, among other factors, have
resulted in increased competition among providers of medical services to
patients. Each of the Regional Group Practices faces competition from other
podiatrists in the communities served, some of which have more established
practices in the market. There can be no assurance that the Regional Group
Practices will be able to compete effectively in the markets they serve. In
addition, there is

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significant competition for the affiliation with podiatric practices and such
competition may limit the availability of suitable practices with which the
Company may be able to affiliate. Generally, there are no significant barriers
to potential competitors entering the industry or pursuing a business strategy
similar to the Company's. Several companies with established operating histories
and greater resources than the Company, including physician practice management
companies and some hospitals, clinics and HMOs, are pursuing activities similar
to those of the Company. There can be no assurance that the Company will be able
to compete effectively with these companies, that additional competitors will
not enter the market or that this competition will not make it more difficult
and costly to acquire the assets of, and provide management services to,
podiatric practices on terms beneficial to the Company. See "Business --
Competition."

NEED FOR ADDITIONAL FUNDS. The Company expects funds available to it from
the proceeds of the Offering, cash from operations and its expected credit line
to fund its operations for approximately twelve months, although this cannot be
assured. The Company has received from a major international financial
institution a commitment for a $30.0 million, three-year revolving credit
facility to help fund its working capital needs, capital expenditures and
practice affiliations. There can be no assurance that a definitive credit
agreement will be entered into, that funds will be immediately available to be
drawn under the credit agreement, or that amounts available under the credit
line will be adequate to meet the Company's needs for funds. The failure of the
Company to enter into the credit line or a similar credit line or to be able to
draw funds immediately thereunder could have a material adverse effect on the
Company's business, financial condition and results of operations. The Company's
growth strategy will require substantial capital. The Company intends to finance
future affiliations with cash, the issuance of debt or equity securities, or any
combination thereof. In the event that the Common Stock does not maintain a
sufficient market value, or potential affiliation candidates are unwilling to
accept debt or equity securities as partial consideration for their practices,
the Company may be required to use its cash resources, if available, to initiate
and maintain its affiliation program. As a result, the Company anticipates that
it will, in the future, seek to raise additional funds through debt financing or
the issuance of equity or debt securities. There can be no assurance that
sufficient funds will be available on terms acceptable to AMP, if at all. The
inability to obtain such financing could have a material adverse effect on the
Company's business, financial condition and results of operations. Furthermore,
issuing shares of Common Stock as consideration for (or in order to provide
financing for) future affiliations could result in significant dilution to
existing stockholders. If additional funds are raised through the incurrence of
debt, the Company may become subject to restrictions on its operations and
finances, including the ability to pay dividends on its capital stock. These
conditions may have an adverse effect on, among other things, the Company's
ability to pursue its affiliation strategy. See "Management's Discussion and
Analysis of Financial Condition and Results of Operations -- Liquidity and
Capital Resources" and "Business -- Strategy -- Growth Strategy."

RESCISSION OFFER. The Company and AFC have determined that it is
appropriate to make a rescission offer to the holders of units ("AFC Units"),
consisting of an aggregate of $1,472,500 in principal amount of promissory notes
in AFC ("AFC Promissory Notes") and 25,840 of membership interests in AFC (the
"Units Rescission Offer"). Each AFC Unit consisted of an AFC Promissory Note
in the principal amount of $95,000 and 1,667 membership interests in AFC sold
for $5,000. See "Units Rescission Offer." There can be no assurance that a
substantial number of investors in such AFC financing will reject the Units
Rescission Offer, if any. Should the Units Rescission Offer be accepted in
total, AFC would be required to pay a total of $1.55 million, plus interest at a
statutory rate accruing from various issuance dates between October 1997 and
February 1998. AFC would repay this amount with funds paid to AFC by the Company
pursuant to the Reimbursement and Assumption Agreement. See "Use of Proceeds."
If the Units Rescission Offer is rejected, AFC will repay with respect to each
AFC Unit the $95,000 AFC Promissory Note and repurchase for $71,667 in cash the
membership interests in AFC originally sold to each investor for $5,000, or a
total of approximately $2.58 million. There can be no assurance that the
liability of the Company based upon any possible failure of the Company or AFC
to comply with federal or state securities laws in connection with the offering
of the AFC Units will be eliminated. See "Units Rescission Offer."

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LIABILITY AND INSURANCE RISKS ASSOCIATED WITH PODIATRIC
PRACTICES. Providing health care services involves potential claims of medical
malpractice and similar claims. The Company does not, itself, engage in the
practice of medicine or have responsibility for compliance with regulatory
requirements directly applicable to physicians and requires affiliated
physicians performing medical services to maintain medical malpractice
insurance. Nonetheless, malpractice claims may be asserted against the Company
if services or procedures performed at one of the Affiliated Practices are
alleged to have resulted in injury or other adverse effects. Although the
Company has obtained liability insurance that will be effective concurrent with
the closing of the Offering that it believes will be adequate as to both risk
and amounts, successful malpractice claims could exceed the limits of the
Company's insurance and could have a material adverse effect on the Company's
business, financial condition or operating results. Moreover, a malpractice
claim asserted against the Company could be costly to defend, could consume
management resources and could adversely affect the Company's reputation and
business, regardless of the merit or eventual outcome of the claim. In addition,
there can be no assurance that the Company will be able to obtain insurance on
commercially reasonable terms in the future or that any insurance will provide
adequate coverage against potential claims. AMP requires each Regional Group
Practice and Affiliated Practice to obtain and maintain professional liability
insurance. This insurance is expected to provide insurance coverage, subject to
policy limits, if the Company is held liable as a co-defendant in a lawsuit for
professional malpractice. In addition, the Company is indemnified by the
Regional Group Practices for liabilities resulting from the Regional Group
Practices' providing medical services.

NO PRIOR PUBLIC MARKET. Prior to this Offering, there has been no public
market for the Company's Common Stock. There can be no assurance that a public
market for the Common Stock will develop or continue after the Offering. The
Company has filed an application for the Common Stock to be approved for
quotation on the Nasdaq National Market, however, there can be no assurance
that, following the Offering, a regular trading market for the Common Stock will
develop or be sustained. The initial public offering price has been determined
by negotiation among the Company and the Underwriters and may bear no
relationship to the market price of the Common Stock after this Offering. See
"Underwriting."

If a public market for the Company's Common Stock develops, from time to
time, there may be significant volatility in the market price of the Common
Stock. Quarterly operating results of the Company, deviations in results of
operations from estimates of securities analysts, changes in general conditions
in the economy or the health care industry or other developments affecting the
Company or its competitors could cause the market price of the Common Stock to
fluctuate substantially. The equity markets have, on occasion, experienced
significant price and volume fluctuations that have altered the market prices
for many companies'securities and that have often been unrelated to the
operating performance of these companies. Concern about the potential effects of
health care reform measures has contributed to the volatility of stock prices of
companies in health care and related industries and may similarly affect the
price of the Common Stock.

SHARES ELIGIBLE FOR FUTURE SALE. The market price of the Common Stock of
the Company could be adversely affected by the sale of substantial amounts of
the Common Stock in the public market following the Offering. After giving
effect to the sale of the shares of Common Stock offered hereby, the Company
will have 5,778,322 shares of Common Stock issued and outstanding (6,328,322
shares if the Underwriters' over-allotment option is exercised in full)
(assuming an initial public offering price of $11.00 per share). Of these
shares, 3,700,000 shares (4,255,000 shares if the Underwriters' over-allotment
option is exercised in full) of Common Stock sold in the Offering will be freely
tradable without restriction under the Securities Act of 1933, as amended (the
"Securities Act"), except for any shares exchanged by "affiliates" of the
Company as that term is defined under the Securities Act. None of the 2,078,322
remaining shares of Common Stock were acquired in a transaction registered under
the Securities Act. Such shares may not be sold except in transactions
registered under the Securities Act or pursuant to an exemption from
registration. All such 2,078,322 shares of Common Stock will be eligible for
sale pursuant to Rule 144 (promulgated under the Securities Act) in March 1999.
In addition, 598,807 shares of Class B Common Stock (as the same may be
converted) will be eligible for sale pursuant to Rule 144 promulgated under the
Securities Act and the balance of these shares will be eligible for sale at
various times from June of 1998 through October 1998. See "Shares Eligible For
Future Sale."

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In addition, AMP, its officers, directors, certain other stockholders of
the Company and the DPM owners have agreed that they will not offer, sell,
contract to sell, announce their intention to sell, pledge or otherwise dispose
of, directly or indirectly, or file with the Commission a registration statement
under the Securities Act relating to any additional shares of Common Stock or
securities convertible or exchangeable or exercisable for any shares of Common
Stock, without the prior written consent of the representative of the
Underwriters for a period of 180 days after the date of this Prospectus (the
"lock-up period"), except (i) subsequent sales of Common Stock offered in the
Offering, (ii) issuances of unregistered Common Stock by the Company in
connection with affiliation with additional practices, DPMs and ancillary
providers (although persons receiving such shares would be subject to such
restrictions for the remainder of the lock-up period), or (iii) issuances of
Common Stock by the Company pursuant to the exercise of employee stock options
outstanding on the date of this Prospectus.

The holders of certain shares of Common Stock outstanding on the date of
this Prospectus have certain registration rights with respect to such shares and
additional shares that may be issued to such persons upon exercise of options
(subject to certain limitations on the number of shares such holders are
entitled to have registered under any registration statement), although the
holders of at least 2,078,322 of these shares of Common Stock and all holders of
Class B Common Stock (including all AFC members to whom shares of Class B Common
Stock will be distributed) have agreed to refrain from selling their shares
during the lock-up period. Pursuant to certain registration rights agreements
with the DPMs (the "Registration Rights Agreements"), the Company has granted
certain registration rights to the DPMs permitting them to include their shares
of the Company's Common Stock on a registration statement filed by the Company
within one year of the date of such agreements. See "Description of Capital
Stock." AMP also intends to register an additional 1,157,098 shares of Common
Stock reserved for issuance under the Company's 1997 Incentive and Non-Qualified
Stock Option Plan as soon as practicable thereafter. See "Management" and
"Underwriting." In addition, the Company will register up to an additional
2,000,000 shares of Common Stock under a shelf registration, which, when
combined with the Company's cash resources, will be used to fund the Company's
planned practice affiliation program. These shares generally will be freely
tradable upon issuance to persons not deemed to be affiliates of the Company,
unless the Company contractually restricts the sale or other transfer of such
shares. Initially, the Company will issue such shares subject to a lock-up
period of up to 180 days from the date of this Prospectus.

SUBSTANTIAL PROCEEDS OF OFFERING PAYABLE TO AFFILIATED PRACTICES AND
AFFILIATES. Approximately $17.4 million of the net proceeds of this Offering
will be used to pay the cash portion of the price of the Transactions, $1.5
million of which will be placed in escrow in connection with the AnestheCare
Acquisition. Approximately $300,000 of the net proceeds of the Offering will be
used to pay the accrued salary of Jack N. McCrary. In addition, approximately
$6.0 million of the net proceeds from the Offering will be used to repay
indebtedness and interest assumed by the Company in connection with the
Transactions, including the reimbursement by AMP of certain expenses and debt
incurred by Ankle & Foot Centers of America, LLC ("AFC") to finance
organizational costs and working capital. See "Use of Proceeds" and "Certain
Transactions."

CONTROL BY EXISTING MANAGEMENT AND STOCKHOLDERS. Following the completion
of the Offering, officers, directors and employees of the Company and investors
in AFC (which financed the Company's initial organizational costs and working
capital) will beneficially own 100% of the outstanding shares of the Class B
Common Stock and the owners of the initial Affiliated Practices will
beneficially own approximately 35% of the outstanding shares of the Company's
Common Stock. Although, following the Offering, no arrangements or
understandings among such persons with respect to the voting of the shares of
Common Stock beneficially owned by such persons will remain in effect, such
persons may nevertheless effectively be able to control the affairs of the
Company. See "Principal Stockholders."

Certain officers, directors and existing stockholders of the Company and
AFC own an aggregate of 650,000 shares of the Class B Common Stock. Each such
share is entitled to two-thirds ( 2/3) of a vote per share and is entitled to
vote with the Common Stock on all matters submitted to a vote of the Company's
stockholders except for the election of the Company's Board of Directors
(pursuant to which the holders of Class B Common Stock may elect one director as
a class) or as required by law. The Class B Common Stock will initially be
convertible into shares of Common Stock at a one-for-one ratio but will
automatically be convertible into additional shares of Common Stock upon the
attainment of the Average Prices.

17
<PAGE>

Attainment of each of the Average Prices will result in conversion of the Class
B Common Stock into a maximum of 1,950,000 shares of Common Stock, further
increasing the control over the Company's affairs by the holders of such shares.
In the event all of the Class B Common Stock is converted into the maximum
number of shares of Common Stock possible through the achievement of all of the
Average Prices on or before the sixth anniversary of this Prospectus, the
officers, directors and employees of the Company and investors in AFC would
beneficially own approximately 25.2% of the Common Stock (assuming no other
issuances of capital stock). If the Average Prices are not achieved prior to the
sixth anniversary of this Prospectus, all outstanding shares of Class B Common
Stock will convert to shares of Common Stock at the conversion ratio then
applicable for such shares. See "Description of Capital Stock -- Common Stock
and Class B Stock."

ANTI-TAKEOVER PROVISIONS. Certain provisions of Delaware law, the
Company's Amended and Restated Certificate of Incorporation and the Company's
Amended and Restated Bylaws, including the terms of conversion of the Class B
Common Stock, could delay or impede the removal of incumbent directors and could
make it more difficult for a third party to acquire, or could discourage a third
party from attempting to acquire, control of the Company. These provisions could
limit the price that investors might be willing to pay in the future for shares
of Common Stock. In addition, shares of preferred stock may be issued by AMP's
Board of Directors without stockholder approval on such terms and conditions,
and having such rights, privileges and preferences, as the Board of Directors
may determine. The rights of the holders of Common Stock will be subject to, and
may be adversely affected by, the rights of the holders of any preferred stock
that may be issued in the future. Under certain circumstances, the Company may
issue Series A Junior Participating Preferred Stock which may have an
anti-takeover effect. The Company has no other current plans to issue any shares
of preferred stock. See "Description of Capital Stock."

IMMEDIATE AND SUBSTANTIAL DILUTION. The purchasers of the shares of Common
Stock offered hereby will experience immediate and substantial dilution in the
net tangible book value of their shares of Common Stock in the amount of $7.93
per share (after giving effect to underwriting discounts and commissions and
estimated Offering expenses). See "Dilution." If the Company issues Common
Stock in the future, including shares that may be issued in connection with
future practice affiliations, purchasers of Common Stock in the Offering may
experience further dilution in the net tangible book value per share of the
Company's Common Stock.

NO INTENT TO PAY DIVIDENDS. The Company has never paid or declared any
cash dividends and does not anticipate paying any cash dividends after
completion of the Offering and the Transactions. In addition, the Company has
entered into a commitment for a credit facility that will restrict the Company's
ability to pay dividends. See "Dividend Policy" and "Management's Discussion
and Analysis of Financial Condition and Results of Operations -- Liquidity and
Capital Resources."

18
<PAGE>
USE OF PROCEEDS

The net proceeds to the Company from the sale of Common Stock in the
Offering assuming an initial public offering price of $11.00 per share (after
deducting the underwriting discount and estimated Offering expenses of
approximately $4,500,000), are estimated to be approximately $33,351,000
($39,028,650 if the Underwriters' over-allotment option is exercised in full).

The Company intends to use the net proceeds from the Offering as follows:
(i) approximately $17.4 million is expected to be used to consummate the
Transactions, $1.5 million of which will be placed in escrow in connection with
the AnestheCare Acquisition, (ii) approximately $6.0 million (including any
amounts payable pursuant to the Units Rescission Offer) is expected to be paid
to AFC, which prior to the Offering owned 56.3% of the Company's outstanding
voting securities, to repay certain interest and indebtedness of AFC, $650,000
of which bears interest at 18% per annum and matures on the fifth day following
the Offering and the remainder of which bears no interest and has no maturity
date (including the reimbursement by the Company of expenses, debt and interest
incurred by AFC to finance the Company's organizational and affiliation costs
and initial working capital), (iii) approximately $3.3 million is expected to be
used to pay certain deferred expenses, (iv) approximately $1.0 million is
expected to be used to complete the purchase of the Company's management
information system, and (v) the balance is expected to be used for general
corporate purposes, including, among other things, making short-term loans of up
to $950,000 aggregate principal amount to DPM owners of Affiliated Practices as
discussed herein and executing the Company's business plan set forth herein. See
"Business -- Practice Affilations," "-- Services and Operations -- Management
Information Systems," "-- Operative Agreements -- Physician Engagement
Agreements" and "Certain Transactions -- Organization of the Company."
Pending such uses, the net proceeds will be invested in United States government
securities and in short-term, interest-bearing investment grade securities. See
"Management's Discussion and Analysis of Financial Condition and Results of
Operations -- Liquidity and Capital Resources."

As mentioned above, the Company may use up to $950,000 of the net proceeds
of the Offering to advance funds to the Regional Group Practices to make
short-term loans to their DPMs. Pursuant to the Physician Engagement Agreements,
an owner DPM may elect to receive an advance on his or her first monthly draw in
the form of a loan from the Regional Group Practice. Loans will be offered to
DPMs to provide short-term liquidity to such DPMs in the initial stages of the
Company's operations. Loans will be limited to an amount equal to (i) an advance
on the first monthly draw of such DPM, (ii) the difference between 90% of the
average monthly compensation of such DPM in the year prior to the Offering and
the current period's level of distributions from the practice for the first
three months after the Offering, and (iii) the difference between 80% of the
average monthly compensation of such DPM in the year prior to the Offering and
the current period's level of distribution for the second three months after the
Offering. Loans, if drawn, will be repayable over two years plus interest at an
annual rate equal to the prime rate, and installments will be withheld from the
DPM's monthly draw. Management will not be able to determine to whom loans will
be made until after the Transfers have been completed, DPMs begin receiving
distributions from the Regional Group Practices, and DPMs decide whether or not
to enter into such loans. Management has not evaluated the DPMs' ability to
repay these obligations, if they arise, but believes the DPMs' financial status
after the completion of the Offering and the expected aggregate amount of such
loans will prevent the loan program from having a materially adverse effect on
the Company.

AFC and the Company have made a Rescission Offer to the holders of AFC
Units. While AFC does not anticipate that any holders of AFC Units will accept
the offer of rescission, there can be no assurance that the Company will not be
required to repay all or a portion of the AFC Units out of the net proceeds of
the Offering. Should the Units Rescission Offer be accepted in total, the
Company would be required to pay from the proceeds of the Offering a total of
$1,550,000, plus a statutory rate of interest accruing from various issuance
dates between October 1997 and February 1998. However, should the Units
Rescission Offer be rejected in total, the Company would be required to pay from
the proceeds of the Offering a total of $2.58 million to such investors
including repaying $1,472,500 in aggregate principal amount of AFC Promissory
Notes and $1,110,839 to repurchase the AFC membership interests from such
persons. See "Risk Factors -- Units Rescission Offer" and "Units Rescission
Offer."

Although the estimates set forth above represent the Company's best
estimate of the intended use of proceeds from the Offering, the timing and
amount of funds required for specific uses by the Company

19
<PAGE>
cannot be precisely determined. The use of proceeds from the Offering is subject
to change based on competitive conditions, unanticipated costs of expansion and
unexpected requirements in developing and operating the Company's business. The
rate of the Company's progress in developing its business, the availability of
alternate methods of financing, and other factors will affect the allocation and
timing of the Company's use of proceeds from the Offering.

DIVIDEND POLICY

The Company does not anticipate paying any cash dividends after completion
of the Offering and the Transactions. In addition, the Company has entered into
a commitment for a credit facility that will restrict the Company's ability to
pay dividends. The Company currently intends to retain any future earnings for
use in its business. See "Management's Discussion and Analysis of Financial
Condition and Results of Operations."

20
<PAGE>
DILUTION

The deficit in pro forma net tangible book value of the Company at December
31, 1997, after giving effect to the Transactions as if they had occurred on
that date, would have been $(13,589,000), or $(4.98) per share. Pro forma net
tangible book value per share represents the amount of pro forma total tangible
assets of the Company less pro forma total liabilities divided by the number of
shares of Common Stock and Class B Common Stock outstanding. After giving effect
to the sale by the Company of the 3,700,000 shares of Common Stock offered
hereby (after deducting the underwriting discounts and commissions and estimated
Offering expenses payable by the Company) and the application of the net
proceeds therefrom as discussed under "Use of Proceeds," the pro forma as
adjusted net tangible book value of the Company as of December 31, 1997 would
have been approximately $19,762,000, or $3.07 per share. This represents an
immediate increase in adjusted pro forma net tangible book value of
approximately $8.05 per share to existing stockholders and an immediate dilution
of approximately $7.93 per share to new investors purchasing Common Stock in
this Offering. The following table illustrates this per share dilution:

Assumed initial public offering price
per share............................. $ 11.00
Pro forma net tangible book value
per share as of December 31,
1997............................. $ (4.98)
Increase per share attributable to
new investors.................... 8.05
---------
Pro forma as adjusted net tangible book
value per share after the Offering.... 3.07
---------
Dilution per share to new investors of
Common Stock.......................... $ 7.93
=========

The following table sets forth on a pro forma basis, giving effect to (i)
the Transactions as of December 31, 1997, (ii) the number of shares of Common
Stock and Class B Common Stock held by existing stockholders, the total
consideration given for such shares and the average price per share paid or
invested in the Company for such shares, and (iii) the number of shares of
Common Stock to be purchased from the Company, the total consideration for such
shares and the average price per share to be paid by new investors purchasing
such shares in the Offering before deducting underwriting discounts and
commissions and estimated Offering expenses payable to the Company:
<TABLE>
<CAPTION>

SHARES PURCHASED TOTAL CONSIDERATION(1) AVERAGE
---------------------- ------------------------- PRICE
NUMBER PERCENT AMOUNT PERCENT PER SHARE
----------- ------- --------------- ------- ---------
<S> <C> <C> <C> <C> <C>
Total existing stockholders............. 2,728,322(2) 42% $ (13,589,000) (50)% (4.98)
New investors........................... 3,700,000(3) 58 40,700,000 150 11.00
----------- ------- --------------- -------
Total(4)........................... 6,428,322 100% $ 27,111,000 100%
=========== ======= =============== =======
</TABLE>
- ------------
(1) Total consideration paid by existing stockholders represents the pro forma
net tangible book value (combined stockholders' equity less goodwill and
other intangibles) of the Company, after giving effect to the Transactions
and before the Offering. See "Use of Proceeds", "Capitalization", and
the Pro Forma Combined Balance Sheet included elsewhere in this Prospectus.

(2) Includes 2,078,322 shares of Common Stock and 650,000 shares of Class B
Common Stock to be outstanding after giving effect to the Transactions.

(3) Does not include 464,500 shares of Common Stock issuable upon the exercise
of options for the purchase of Common Stock pursuant to the Company's stock
option plans and 555,000 shares of Common Stock subject to the Underwriters'
over-allotment option.

(4) Management does not believe the acceptance of the Units Rescission Offer
and/or the Practice Owner Rescission Offer would have a material effect on
dilution.

21
<PAGE>
CAPITALIZATION

The following table sets forth the short-term obligations, long-term debt,
and the total capitalization of the Company (i) as of December 31, 1997, (ii) on
a pro forma basis to reflect the Transactions, and (iii) on a pro forma as
adjusted basis to reflect the Transactions, the sale by the Company of 3,700,000
shares of Common Stock offered hereby and the application of the estimated net
proceeds therefrom. See "Use of Proceeds." This table should be read in
conjunction with "Management's Discussion and Analysis of Financial Condition
and Results of Operations," the Company's Financial Statements and Notes
thereto and the Unaudited Pro Forma Combined Balance Sheet appearing elsewhere
in this Prospectus.
<TABLE>
<CAPTION>
AS OF DECEMBER 31, 1997
-----------------------------------------------
PRO FORMA
HISTORICAL PRO FORMA(1) AS ADJUSTED(1)(2)
---------- ------------ -----------------
(IN THOUSANDS)
<S> <C> <C> <C>
Current portion of long-term debt.... $ -- $ 656 $ 656
Due to stockholder(3)................ 4,043 4,043 --
Distribution liability(4)............ -- 8,989 --
Acquisition liability(5)............. -- 6,900 --
---------- ------------ -----------------
Total short-term
obligations................ $ 4,043 $ 20,588 $ 656
========== ============ =================
Long-term debt, less current
portion............................ $ -- $ -- $--
---------- ------------ -----------------
Stockholders' deficit:
Preferred Stock, $.001 par value;
20,000,000 shares authorized; no
shares issued and outstanding,
pro forma or pro forma as
adjusted........................ -- -- --
Class A Common Stock, $.001 par
value; 20,000,000 shares
authorized(6); 2,078,322 shares
issued and outstanding, pro
forma, 5,778,322 shares issued
and outstanding pro forma as
adjusted(7)..................... -- 2 6
Class B Common Stock, $.001 par
value; 1,000,000 shares
authorized(6); 650,000 shares
issued and outstanding(7)....... 1 1 1
Additional paid-in capital......... 1,531 (703) 32,644
Accumulated deficit................ (4,143) (4,143) (4,143)
---------- ------------ -----------------
Total stockholders' equity
(deficit).................. (2,611) (4,843) 28,508
---------- ------------ -----------------
Total capitalization................. $ (2,611) $ (4,843) $ 28,508
========== ============ =================
</TABLE>

- ------------
(1) See Unaudited Pro Forma Combined Balance Sheet and the Notes thereto
included elsewhere in this Prospectus for a discussion of the assumptions
made and adjustments applied in preparation of this information.

(2) Gives effect to the sale of 3,700,000 shares of Common Stock offered by the
Company at an assumed initial public offering price of $11.00 per share and
the application of the estimated net proceeds therefrom. See "Use of
Proceeds."

(3) Represents the expenses, debt and interest incurred by AFC to finance the
Company's organizational and affiliation costs and initial working capital.
Such amount plus any additional amounts incurred by AFC subsequent to
December 31, 1997 (which is expected to total $6.0 million) will be
reimbursed by the Company from the proceeds of the Offering.

(4) Represents the cash distribution to promoters in connection with the
Transfers (excluding the Ambulatory Surgery Center Acquisitions and the
Kramer Transfer), including the liability attributed to monetary assets
acquired of $4.3 million.
(5) Includes the $4.5 million payable in connection with the AnestheCare
Acquisition, $1.4 million payable in connection with the Kramer Transfer,
and $1.0 million payable in connection with the Ambulatory Surgery Center
Acquisitions.

(6) Reflects an amendment to the Company's Certificate of Incorporation filed
subsequent to December 31, 1997 to increase the authorized capital stock,
revise the par value to $.001 per share, and to designate classes of common
stock.

(7) Does not include 464,500 shares of Common Stock issuable upon the exercise
of outstanding options for the purchase of Common Stock pursuant to the
Company's stock option plans and 555,000 shares of Common Stock subject to
the Underwriters' over-allotment option.

22
<PAGE>
SELECTED FINANCIAL DATA

PERIOD FROM
INCEPTION
(AUGUST 9, 1996) FOR THE
TO YEAR ENDED
DECEMBER 31, 1996 DECEMBER 31, 1997
------------------ ------------------
STATEMENT OF OPERATIONS DATA(1):
Revenues............................. $ -- $ --
Expenses............................. 1,436,441 2,706,255
------------------ ------------------
Net loss............................. $ (1,436,441) $ (2,706,255)
================== ==================

DECEMBER 31, 1997
HISTORICAL AS ADJUSTED(2)
------------------ ------------------
(UNAUDITED)
BALANCE SHEET DATA:
Cash and cash equivalents............ $ -- $ 12,890,000
Working capital (deficit)(3)......... (3,117,512) 15,986,000
Total assets(4)...................... 4,194,238 30,130,000
Long-term debt....................... -- 656,000
Stockholders' equity (deficit)....... (2,610,677) 28,508,000

- ------------

(1) The Company has conducted no significant on-going, non-developmental
business operations to date and will not conduct significant business
operations until the affiliation of the Company with the initial Affiliated
Practices and the Offering are completed. Pursuant to the Reimbursement and
Assumption Agreement, the Company will reimburse the affiliation-related
expenses incurred by AFC since May 1996, including AFC's payroll, travel and
entertainment, office equipment and professional fees. AFC currently holds
365,625 shares of Class B Common Stock which management plans to distribute
to AFC members approximately 180 days after consummation of the Offering.

(3) The historical balance includes $4.0 million due to AFC as of December 31,
1997 which will be repaid upon consummation of the Offering. The Company
expects this amount due to AFC to be approximately $6.0 million upon the
anticipated closing date of the Offering.

(4) The Company will record the non-monetary assets transferred to the Company
in connection with the Transfers at the historical cost basis of the
transferors, excluding the Ambulatory Surgery Center Acquisitions and the
Kramer Transfer. Monetary assets transferred as well as the AnestheCare
Acquisition, the Kramer Transfer and the Ambulatory Surgery Center
Acquisitions will be accounted for in a method similar to purchase
accounting.

23
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS

THE FOLLOWING DISCUSSION AND ANALYSIS CONTAINS CERTAIN STATEMENTS OF A
FORWARD-LOOKING NATURE RELATING TO FUTURE EVENTS OR THE FUTURE FINANCIAL
PERFORMANCE OF THE COMPANY. SUCH STATEMENTS ARE ONLY FORECASTS, AND THE ACTUAL
EVENTS OR RESULTS MAY DIFFER MATERIALLY FROM THE RESULTS DISCUSSED IN THE
FORWARD-LOOKING STATEMENTS. FACTORS THAT COULD CAUSE OR CONTRIBUTE TO SUCH
DIFFERENCES INCLUDE, BUT ARE NOT LIMITED TO, THOSE DISCUSSED IN "RISK
FACTORS," AS WELL AS THOSE DISCUSSED ELSEWHERE IN THIS PROSPECTUS. THE
HISTORICAL RESULTS SET FORTH IN THIS DISCUSSION AND ANALYSIS ARE NOT INDICATIVE
OF TRENDS WITH RESPECT TO ANY ACTUAL OR PROJECTED FUTURE FINANCIAL PERFORMANCE
OF THE COMPANY. THE FOLLOWING SHOULD BE READ IN CONJUNCTION WITH THE FINANCIAL
STATEMENTS AND RELATED NOTES THERETO APPEARING ELSEWHERE IN THIS PROSPECTUS.

OVERVIEW

The Company's business operations since its incorporation in August 1996
have consisted solely of arranging the Transactions and preparing to implement
its related business plan described herein. At the time of the anticipated
initial Affiliated Practice affiliations, the predecessors of the initial
Affiliated Practices will have been separate businesses engaged in podiatric
care. In connection with the Transactions, the Company will receive certain
operating assets or receivables and stock and assume certain liabilities of the
Affiliated Practices, AnestheCare, and the Ambulatory Surgery Center
Acquisitions and enter into long-term management agreements with the Regional
Group Practices. Pursuant to the Management Agreements, the Company will
provide, among other things, facilities, management, administrative and
development services to the Regional Group Practices and employ non-physician
personnel, in each case in exchange for management fees, the Company's principal
anticipated source of revenues.

Management fees will be paid monthly to the Company by each Regional Group
Practice based upon the Regional Group Practice's adjusted patient revenues (the
Regional Group Practice's billings less contractual adjustments, including
adjustments for special third-party payor and private pay arrangements, and
adjustments for bad debts). The Company will be responsible for collecting the
billings of the Regional Group Practices. The Company will retain a service fee
ranging from 9% to 25% of the Regional Group Practice adjusted patient revenues
and an amount equal to the expenses of the Regional Group Practice advanced by
AMP pursuant to the Management Agreements. The expenses expected to be incurred
by AMP in fulfilling its obligations under the Management Agreements will be the
salaries, wages and benefits of personnel (other than DPM owners and certain
employed DPMs), supplies, expenses involved in administering the clinical
practices of the Regional Group Practices and general and administrative
expenses, including billing and collections services, as well as depreciation,
amortization and interest incurred in the acquisition of assets by the Company
in connection with the Transactions. The Company will seek to reduce these
operating expenses through purchase discounts, economies of scale,
standardization of best practices, and other operating efficiencies. If the
service fee varies by more than 5% over or under the adjusted service fee (as
defined), then the service fee may be adjusted quarterly by the Joint Planning
Committee of the Regional Group Practice (composed of Company and Affiliated
Practice representatives) on a prospective basis only (without a floor or
ceiling on the adjustment) upon the request of either party to the Management
Agreement in order to reflect the fair value of the management services
provided, based upon the nature and volume of services required, the risks
assumed by the Company, and the total revenues of the Regional Group Practice.
Accordingly, the Company will maintain a net revenue interest and not a net
profits interest. The compensation of each DPM in each Regional Group Practice
will be determined solely by the Joint Planning Committee of the Regional Group
Practice and will not include any guaranteed component. The amount of the
management service fees paid by the Regional Group Practices to AMP and the
compensation of each Regional Group Practice's DPMs will be directly affected by
the amount of patient revenue generated by each Regional Group Practice. The
inability of the Regional Group Practices to generate sufficient patient revenue
could have a material adverse effect on the Company's business, financial
condition and results of operations.

24
<PAGE>
generated from services provided by the Regional Group Practice to its patients
that are ancillary to DPM podiatric care (such as orthotics, ambulatory care,
physical therapy and the like). Ancillary expenses to be netted against
ancillary revenues will generally include, but not be limited to, costs for
items such as personnel, facilities, equipment, supplies and other such expenses
directly attributable to the generation of ancillary revenues. In connection
with the AnestheCare Acquisition, the Company will retain the existing financial
and fee arrangements of AnestheCare with its clients. Currently, AnestheCare
generates revenue through both the provision of management and billing services
as well through various cost-sharing agreements with its clients. In exchange
for these services, AnestheCare typically is entitled to a fee equivalent to
specified percentages of gross revenues and collections it receives on behalf of
its clients. After the AnestheCare Acquisition, AnestheCare will provide
services to certain of the Regional Group Practices on a discounted basis. See
"Business -- Operative Agreements -- Management Agreements" for a complete
description of other material terms of the Management Agreements.

In addition to the expenses AMP will incur in fulfilling its obligations
under the Management Agreements and the ancillary expenses described above, AMP
will also incur personnel, rental and other typical expenses in connection with
its corporate management, which will provide management, administrative,
marketing, development, acquisition and other services to the Regional Group
Practices.

The Company may, in the future, negotiate on behalf of Regional Group
Practices and others, capitated, episode-of-care, and shared risk fee
arrangements with third-party payors. These arrangements could result in patient
care in which the Regional Group Practices' costs of delivering care exceed the
amounts reimbursed by the applicable third-party payor. The Company intends to
help the Regional Group Practices manage these risks by establishing loss limits
with the third-party payors who are party to these arrangements and helping the
Regional Group Practices anticipate with reasonable accuracy the course of care
and related costs for specific conditions and diseases covered by the
arrangements with third-party payors.

RESULTS OF OPERATIONS

The Company has not conducted on-going, non-developmental business
operations and will not until the Transactions and the Offering are complete.
Consequently, AMP has generated no revenues.

The Company's principal stockholder, AFC, incurred a loss for the period
from the date of its organization in 1996 through December 31, 1997 of
approximately $4.1 million, reflecting principally salaries of AFC personnel
(including non-cash charges of $1.5 million) and office expenses since its
inception. The Company has agreed to reimburse AFC for these expenses upon
completion of the Offering.

LIQUIDITY AND CAPITAL RESOURCES

AFC, on the Company's behalf, has financed the Company's operations to date
from the proceeds of AFC's private placements of debt and equity. To date, AFC
has received net proceeds from private placements of debt and equity in an
aggregate amount of approximately $4.7 million. AMP has agreed to assume AFC's
obligations under such debt at and after the Offering. In order to complete the
funding of the Company's development and organization expenses through the
closing of the Offering, members of management and consultants made short-term
loans to AFC in the aggregate principal amount of $210,000. In addition, an
institutional investor, which had previously loaned AFC $500,000, has agreed to
increase the amount of its short-term loan to AFC by an additional $150,000. AFC
will repay the principal amount of these loans, and interest in the aggregate
amount of $141,125, to such persons with the portion of the funds from the
Company's Offering reimbursed to AFC for expenses, debt and interest incurred by
AFC on behalf of the Company.

The Company intends to fund its future operations from the proceeds of the
Offering, cash generated from operations, monies drawn under the revolving
credit facility discussed below, and, if necessary, the proceeds of future
public or private financings. The Company intends to use the proceeds of the
Offering to consummate the Transactions, repay indebtedness of the Company and
AFC, pay certain deferred expenses, complete the purchase of the Company's
management information system, and fund general corporate

25
<PAGE>
operations. In addition, the Company may advance funds from the Offering to the
Regional Group Practices in order for them to make loans to the owner DPMs. See
"Use of Proceeds."

If the Transactions and the Offering had occurred on December 31, 1997, the
Company would have had pro forma working capital of approximately $16.0 million.

In connection with certain of the Transactions, the Company will record
aggregate federal and state deferred tax liabilities of approximately $966,000.
These liabilities generally will become payable over an approximate three-year
period commencing on the date of the consummation of such Transfers.

AMP anticipates that its capital expenditures during 1998 will relate
primarily to affiliations with additional Affiliated Practices, if any,
development of the ancillary services network, and expenditures related to
expansion and purchase of equipment for the Affiliated Practices. The Company
anticipates that funding for these expenditures will be derived from the
proceeds of the Offering, funds borrowed under the Company's anticipated credit
facility, and cash flow from operations. Management believes that these sources
will be sufficient to fund the Company's capital needs for a period of
approximately twelve months following completion of the Offering. Thereafter, if
necessary, the Company will seek to raise additional funds for capital
expenditures through borrowings or the issuance of debt or equity securities.
There can be no assurance that sufficient funds will be available from sources
other than the Offering on terms acceptable to the Company, if at all.

The Company has received a commitment for a $30.0 million three-year
revolving credit facility with a major international financial institution which
is intended to be available to assist in funding the Company's working capital
needs, capital expenditures and anticipated future affiliations. The credit
facility will contain customary affirmative and negative covenants (including
prohibitions on the payment of dividends and capital expenditures) and events of
default customary to transactions of this type. The credit facility will bear
interest at a rate equal to the London Inter-Bank Offered Rate plus an
applicable margin of between 100-250 basis points based upon the Company's ratio
of Senior Debt (as defined) to EBITDA, or, at the Company's option, at such
financial institution's Base Rate plus a margin based on the ratio of the
Company's senior debt to earnings before interest, taxes, depreciation and
amortization. There can be no assurance that the Company will ultimately close
on the credit facility. In addition, the Company is, concurrently with the
Offering, registering 2,000,000 additional shares of Common Stock under the
Shelf Registration, which, when combined with the Company's cash resources, will
be used to fund the Company's planned practice affiliation program.

The success of AMP is directly dependent upon, among other things, the
ability of AMP to obtain funds by providing services to Regional Group
Practices. If funds from this principal source are unavailable or insufficient,
the Company will need to obtain financing from other sources, such as the
issuance of additional debt or equity securities or borrowings. There can be no
assurance that those alternative sources would be available, available on
favorable terms, or sufficient to meet the Company's capital requirements.

ACCOUNTING

Of the 46 Transfers of the initial Affiliated Practices, 45 will be
accounted for by the Company under SEC Staff Accounting Bulletin No. 48 ("SAB
48"), "Transfers of Non-Monetary Assets by Promoters or Shareholders," so
that the non-monetary assets and liabilities of these initial Affiliated
Practices will be received by the Company at the transferor's historical cost
basis for accounting purposes. The AnestheCare Acquisition, the Kramer Transfer
and the Ambulatory Surgery Center Acquisitions which are made following the SAB
48 transactions and the Offering, will not be accounted for under SAB 48.
Instead, these and all future individual practice affiliations will be accounted
for as purchases at fair market value and are expected to result in purchase
prices in excess of net assets acquired (goodwill) which will require subsequent
noncash amortization charges in the Company's statements of operations. Monetary
assets and liabilities of the initial Affiliated Practices, including cash,
billed and unbilled receivables and credit balances, payables and certain
miscellaneous accruals, will either be acquired by AMP at their fair market
value or retained by the Affiliated Practices, as agreed among the parties.

26
<PAGE>

The aggregate consideration to be paid by the Company in the Transfers is
approximately $34.5 million, consisting of approximately $18.3 million payable
in shares of Common Stock at the initial public offering price attributed to the
net non-monetary assets, approximately $4.7 million in cash and $156,000 of
assumed indebtedness attributed to the net non-monetary assets of the SAB 48
Transfers, $4.3 million in cash attributed to the net monetary assets of the SAB
48 Transfers, $4.1 million payable in shares of Common Stock at the initial
public offering price, $1.0 million in cash and $500,000 of assumed indebtedness
attributed to the Ambulatory Surgery Center Acquisitions which are included in
the Transfers but not accounted for under SAB 48, and $1.4 million in cash
attributed to the Kramer Transfer. Of the total consideration attributed to the
non-monetary assets for each SAB 48 transfer, the Affiliated Practices could
elect to receive up to 25% in cash and the balance in shares of Common Stock.
The non-monetary assets and liabilities of these Affiliated Practices will carry
over to AMP at their historical costs. The assets to be transferred include
billed and unbilled receivables, supplies inventory, other receivables, prepaid
expenses, net equipment and certain other current and noncurrent assets. The
liabilities to be transferred include credit balances of accounts receivable,
certain miscellaneous accruals and debt assumed. The cash of approximately $4.7
million paid to the Affiliated Practices for the non-monetary assets in the SAB
48 Transfers will be recorded as a dividend by the Company. Consideration in the
AnestheCare Acquisition will consist of approximately $4.5 million in cash.
Additional consideration of up to $1.5 million in cash and a number of Common
Shares equal to $500,000 valued at the initial public offering price will be
held in escrow and may be paid to the owners of AnestheCare pending
AnestheCare's achievement of certain performance targets over the three-year
period beginning January 1, 1998.

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<PAGE>
BUSINESS

THE COMPANY

AMP was founded in August 1996 to provide practice management services and
comprehensive foot care delivery systems to podiatric practices throughout the
United States. AMP will generate revenue by providing to the Affiliated
Practices professional management, marketing, expertise, equipment and
facilities often unavailable to podiatrists with small practices. The initial 46
Affiliated Practices consist of 66 doctors of podiatric medicine ("DPMs")
operating 89 offices located in 7 states serving 57 cities. The Company intends
to grow rapidly by affiliating with additional podiatric practices and by making
available to the Affiliated Practices services that are ancillary and directly
related to the Affiliated Practices' existing podiatric care.

The Company has entered into definitive agreements to transfer cash and
Common Stock and assume certain liabilities in exchange for stock or certain
operating assets and receivables of the Affiliated Practices simultaneous with
and as a condition to the closing of the Offering. The DPMs will join Regional
Group Practices organized by geographic location and will enter into physician
engagement agreements with the Regional Group Practices. AMP will enter into a
long-term management agreement with each Regional Group Practice under which AMP
will receive fees for its services. The Company will own the operating assets of
the Affiliated Practices, hire the non-physician employees, and otherwise assume
the management of each practice. The initial Affiliated Practices were selected
based upon their location, size, historical profitability and growth, and
reputation for high quality care. Based on management's knowledge of the U.S.
podiatric industry gained from conversations with DPMs, surveys of the size of
other podiatric practice management companies, affiliations and groups, and
industry research, management believes that the initial Affiliated Practices are
leading podiatric practices in their respective markets and that, following the
Transactions, AMP will be the largest provider of comprehensive podiatric
practice management services in the United States.

A key element of the Company's strategy is to provide ancillary services
and facilities to the Affiliated Practices. These ancillary services and
facilities are expected to include, among other things, ambulatory surgical
centers, anesthesiology, pathology, radiology, MRIs, EKGs, laboratory work,
pharmacy, physical history and exams, physical therapy, orthotics, pain
management, home care, diabetic wound care, specialty shoes and other retail
products. The Company intends to make available some or all of these ancillary
services on a regional basis. The Affiliated Practices in each region will
primarily or exclusively use AMP's ancillary services, enabling the Company to
control the cost, quality and other important aspects of these services.
Pursuant to this strategy, AMP has entered into a definitive agreement to
purchase certain assets of AnestheCare, an anesthesiology management services
organization currently servicing 15 locations in metropolitan Atlanta, Georgia.
AnestheCare provides billing and management services to anesthesiologists and
other providers of health care related services to local hospitals and others.
AnestheCare's current operations and ongoing business relationships will
continue after the AnestheCare Acquisition. In addition, after the acquisition,
AnestheCare will provide anesthesiology management services to certain of the
Regional Group Practices. The Company is also acquiring Bellaire Surgicare, Inc.
and Clayton Outpatient Surgical Center, Inc., which own surgical centers.

THE PODIATRIC INDUSTRY

Podiatry is the practice of medicine whereby DPMs provide preventative,
diagnostic, surgical and other foot care to patients. Podiatric care ranges from
relatively simple procedures, such as treating foot infections, to complex
surgeries, such as reconstructing the bones in the foot. According to the
American Podiatric Medical Association ("APMA"), 39% of all foot care is
provided by DPMs compared to 13% by orthopedic physicians, 37% by other
physicians and 11% by physical therapists and others. Today, there are
approximately 10,700 active DPMs throughout the United States handling 55
million patient visits per year. In 1995, active DPMs averaged 92 patient visits
per week and 80 bone surgeries for the year.

After finishing school at a College of Podiatric Medicine, DPMs are
required to pass rigorous state board examinations and complete at least one
year of residency before they are licensed to practice. Each

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<PAGE>
state has somewhat different requirements for a DPM to become licensed although
there is reciprocity among many states. Most states also require continuing
educational programs for regular license renewal. In addition, DPMs may become
Board Certified by one of several national podiatric certification boards.
Generally, in order to become Board Certified a DPM must have completed three
years of practice and pass oral and written examinations. Many health
maintenance organizations require the DPMs in their provider network to be Board
Certified. According to the APMA, 99% of DPMs graduated from one of seven
Colleges of Podiatric Medicine, 87% completed residency programs, and 36% are
Board Certified. All of the owner DPMs at the Affiliated Practices have
completed residency programs and are licensed, approximately 94% are Board
Certified, and the remaining non-Board Certifed owner DPMs are Board Eligible
(that is, having passed the Board's written exam and are awaiting the Board's
oral examination).

According to the APMA, billing receipts of all DPMs in the United States
increased to approximately $2.3 billion in 1995 from approximately $1.3 billion
in 1987, a compound annual growth rate of 7.7%. The Company believes that the
historical growth in DPM revenues is due to a number of factors including the
following:

o AGING POPULATION. The Bureau of Census forecasts that the resident
population of the United States will increase between 1997 and 2010 by an
average annual rate of 0.8%. However, the number of persons age 65 and over
will increase by an average annual rate of 1.1% over the same period.
People age 65 and over experience foot problems at approximately twice the
rate of persons under the age of 65, and based on Medicare program studies,
older persons utilize DPMs at a higher rate than the remainder of the
population.

o INCREASING MANAGED CARE. As recently as 1988, only an approximate 25% of
all privately insured individuals were covered by managed care. By 1996,
over three-quarters of active employees in the private sector were enrolled
in some type of managed care arrangement. The Company believes that primary
care physicians are more likely to refer foot care patients covered by
managed care to DPMs, as a result of the lower reimbursement rates
anticipated for foot care under managed care programs relative to foot care
covered on a fee-for-service basis.

o INCREASED MEDICARE ENROLLMENT. Managed care enrollment in Medicare has
doubled in the last three years and is growing at an annual rate of
approximately 30%. Enrollees are generally older than the average
population, and consequently, incur a higher incidence of foot problems. In
addition, the Company believes that enrollees are more likely to visit a
podiatrist than non-insured individuals.

The podiatric industry in the United States is highly fragmented, dominated
by solo and small group practices. According to the APMA, 69% of the
approximately 14,000 total DPMs in the United States are sole practitioners with
the majority of the remaining DPMs in small or medium-sized practices, generally
consisting of two to four DPMs. In addition, there is an oversupply of podiatric
service providers in the United States that could exceed demand by as much as
27% in 2010. Finally, as with other areas of health care, there is a pronounced
trend toward managed care in the podiatric industry.

The Company believes that due to (i) the highly fragmented structure of the
podiatric industry, (ii) the growing surplus of DPMs, and (iii) the trend toward
managed care, the industry is ripe for a provider of comprehensive podiatric
practice management services such as AMP. The Company intends to pool the
resources of, and provide professional management to, some of the nation's
leading podiatrists in order to allow them to compete more effectively in the
current and anticipated podiatric industry environment. Management expects its
operating and growth strategies to attract third party payors, provide a strong
incentive for DPMs to affiliate with the Company, and allow practices affiliated
with the Company to be more successful than their primarily small practice
competitors in an environment of increased competition and over-supply.

OPERATING STRATEGY

The Company's objective is to be the nation's leading provider of
management services and comprehensive foot care delivery systems to podiatric
practices. To achieve this objective, the Company will employ the following
operating strategies:

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<PAGE>
ENHANCING QUALITY OF DPM PATIENT CARE. Management believes that the
services and support it will provide the Affiliated Practices will positively
impact DPM patient care. The Company, through its Affiliated DPMs and its
Medical Policy Board is developing uniform standards of care for the Affiliated
Practices to ensure quality control and provide the opportunity to implement the
most current and effective podiatric treatments and techniques. The Company
believes that one of its most valuable practice management services will be its
ability to identify practice-level strategies that have proven successful for
individual Affiliated Practices and share these best practices with other
Affiliated Practices. The quality of patient care is also expected to improve as
a result of (i) treatment protocols and other important information being made
available to each Affiliated Practice by the Company's sophisticated management
information system, (ii) the peer review that will result from being affiliated
with other podiatrists, the Company's Medical Advisory Board and the respective
Boards of the Regional Group Practices, (iii) more time being made available to
DPMs for patient care rather than administrative duties, and (iv) the continuity
of care, including early disease detection and treatment, that will be afforded
by the Affiliated Practices and the Company's ancillary services.

ACHIEVING OPERATIONAL EFFICIENCIES. The Company intends to implement a
variety of operating procedures and systems to improve the productivity and
profitability of each Affiliated Practice. The Company is developing and
implementing a centralized management information system, uniform inventory
control procedures, and national group purchasing contracts. In addition, the
Company is installing a patient billing and collections system that is expected
to improve collections as a result of its ease of use, billing frequency, and
standardized procedures. Management also believes that physical improvements in
design to certain Affiliated Practices' facilities should result in an increase
in the volume of patients seen and an increase in employee and DPM productivity.

DEVELOPING REGIONAL GROUP PRACTICE STRUCTURE. AMP will use the Regional
Group Practices as an important mechanism to pool the Affiliated Practices'
resources and implement its other strategies. The Regional Group Practices, and
in particular the Boards thereof, will (i) collect from and disseminate to its
Affiliated Practice members best practices and standards of care, (ii) provide
the mechanism for peer review and quality control of the Affiliated Practices,
(iii) develop regional marketing and advertising programs, (iv) identify,
recruit, and integrate additional practice affiliations and ancillary services
acquisitions, and (v) coordinate the sharing of specialists' resources in each
region.

PROVIDING EFFECTIVE MARKETING. The Company intends to develop and
implement aggressive and innovative marketing and advertising plans to augment
each Affiliated Practice's existing referral and other marketing efforts.
Management believes that the podiatric industry has not taken advantage of the
gains that can be achieved through strategic direct and target marketing. In
particular, AMP plans to (i) target market to specific underserved market
segments, (ii) market and advertise in a manner designed to attract walk-in
patients for whom the DPMs would be the primary care provider for foot care,
(iii) market directly to payors in the managed care system, and (iv) develop and
market to payors disease-specific treatment programs for the early detection of
certain types of foot problems.

IMPLEMENTING COMPREHENSIVE FOOT CARE DELIVERY SYSTEMS. The Company plans
to make available ancillary care providers and their resources to work with DPMs
in individual practices within each Regional Group Practice. By making these
specialists and resources available to each Regional Group Practice, the Company
plans to create an integrated, comprehensive system of podiatric services that
management believes will exceed the capabilities of most traditional podiatric
practices operating on their own. The Company expects that making available
ancillary services and facilities, including, among others, ambulatory surgical
centers, anesthesiology, pathology, radiology, MRIs, EKGs, laboratory work,
pharmacy, physical history and exams, physical therapy, orthotics, pain
management, home care, diabetic wound care, specialty shoes and other retail
products, to its Affiliated Practices will promote better patient care and
provide patients with one-stop foot care services.

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<PAGE>
GROWTH STRATEGY

Management believes the growth of the initial Affiliated Practices and the
development of new Affiliated Practices are key components of the future success
of the Company. Key elements of the Company's growth strategy include:

GROWING AFFILIATED PRACTICES. The Company will assist Affiliated Practices
in expansion through regionally-focused marketing and advertising and
improvements in operating efficiencies. The Company believes that such an
approach will increase the Affiliated Practices' market share and revenues. The
Company also intends to make available capital for practice expansion through
market research, site selection, office design, and marketing.

DEVELOPING ANCILLARY PROVIDER NETWORK. The Company intends to augment its
growth by adding a network of providers of ancillary products and services that
will complement the services provided by the Affiliated Practices. The Company
believes that, by acquiring or contracting with providers of ancillary services
on behalf of the Regional Group Practices, the Company will create a new
approach to the delivery of podiatric services and provide a menu of services
that is more comprehensive than that traditionally offered by individual
podiatric practices.

AFFILIATING WITH NEW PRACTICES. A core business strategy of the Company is
to affiliate with additional podiatric practices. Management believes that an
ample supply of candidates for podiatric practice affiliations exist among the
approximately 10,700 active podiatrists in the United States. The Company plans
to select additional practice affiliations from this pool based upon each
practice's location, size, historical profitability and growth, and reputation
for high quality care. Management believes that affiliation will be an
attractive option for many of these podiatrists because the Company intends to
(i) provide capital to open and integrate new offices into existing Affiliated
Practices, (ii) identify and recruit qualified DPMs for the Affiliated
Practices, (iii) design and offer business and operational, financial and
clinical systems for each Affiliated Practice, (iv) hire the necessary
administrative and non-physician personnel for each new Affiliated Practice, (v)
implement effective marketing and advertising strategies designed to help
increase each Affiliated Practice's market share and the number of new patients,
and (vi) reduce the time Affiliated Practices spend on administrative duties,
allowing them to focus on delivering quality patient care.

PRACTICE AFFILIATIONS

The Company has entered into definitive agreements, to be consummated
simultaneously with the closing of this Offering, to obtain certain operating
assets and receivables of or the stock of certain entities holding the assets of
the initial Affiliated Practices, which include 66 DPMs operating 89 offices
located in 7 states serving 57 cities. Management believes that the Affiliated
Practices are leading practices in their markets. The Affiliated Practices were
selected based upon a variety of factors, including location, size, historical
profitability and growth, and reputation for high quality care among local
consumers of podiatric services and within the podiatric services industry.
Management intends to capitalize on the reputations and relationships of the
Affiliated Practices and their DPMs to assist the Company in affiliating with
additional podiatric practices.

The aggregate consideration that will be paid by the Company to acquire the
operating assets, receivables or stock of the initial Affiliated Practices
consists of approximately (i) $11.5 million in cash (of which $4.7 million
represents payment for accounts receivable) and (ii) $22.4 million payable in
shares of Common Stock at the initial public offering price. The purchase prices
for the initial Affiliated Practices were determined by the practice's gross
revenue, growth potential, quality of patients, service delivery and depth of
presence in its local market. The Company will also assume certain indebtedness
of the initial Affiliated Practices and pursuant to the Ambulatory Surgery
Center Acquisitions totaling approximately $656,000. For a more detailed
discussion of amounts to be paid to and indebtedness assumed of each of the
initial Affiliated Practices, see "Certain Transactions."

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<PAGE>
Upon consummation of the Transfers, the Company will provide management
services to the following Regional Group Practices:
<TABLE>
<CAPTION>
REGIONAL NUMBER OF NUMBER OF NUMBER OF
GROUP PRACTICE MARKET STATE PRACTICES PODIATRISTS OFFICES
- ------------------------------------- -------------- ---------------- ---------- ---------- ----------
<S> <C> <C> <C>
Atlanta.............................. Atlanta Georgia 2 5 7
Houston.............................. Houston Texas 16 22 33
Maryland............................. Hagerstown Maryland 4 8 3
Pennsylvania* -- -- 3
West Virginia* -- -- 1
Miami................................ Miami Florida 8 10 11
Middle Georgia....................... Macon Georgia 1 2 5
North Texas.......................... Amarillo Texas 1 1 1
Dallas Texas 5 7 8
Fort Worth Texas 4 4 3
South Texas.......................... San Antonio Texas 3 4 8
Brownsville Texas 1 1 1
St. Louis............................ St. Louis Missouri 1 2 5
-- -- --
Total........................... 46 66 89
== == ==
</TABLE>
- ------------

* One of the Affiliated Practices in Maryland has 3 offices in Pennsylvania and
another has an office in West Virginia.

The Company has also entered into a definitive agreement to acquire certain
assets of AnestheCare for approximately $4.5 million in cash. Additional
consideration of up to $1.5 million in cash and $500,000 payable in shares of
Common Stock valued at the initial public offering price will be held in escrow
and may be paid to the owners of AnestheCare pending AnestheCare's achievement
of certain performance targets over a three-year period beginning January 1,
1998. AnestheCare provides billing and management services to providers of
health care-related services to local hospitals and others.

SERVICES AND OPERATIONS

MANAGEMENT SERVICES

Simultaneous with the Offering, each Affiliated Practice will join a
Regional Group Practice which will, in turn, enter into a long-term Management
Agreement with the Company. Under the Management Agreement, the Company will
employ the Affiliated Practice's non-physician personnel, assume and enter into
leases for their facilities and provide services such as practice management,
information systems, marketing and negotiation of payor contracts.

The Company believes that its integrated care delivery network will give
the Regional Group Practices the ability to, among other things, reduce
overhead, engage in regional contracting with managed care payors, and expand
service offerings. Pursuant to the Management Agreements, the Company will
assist the Regional Group Practices in strategic planning, preparation of
operating budgets, and capital project analysis. The Company intends to
coordinate group purchasing of supplies, inventory, and insurance for the
practices. In addition, the Company will assist the Regional Group Practices in
physician recruitment by introducing physician candidates to the Regional Group
Practices and advising the Regional Group Practices in structuring employment
arrangements.

The Company also will provide or arrange for a variety of additional
services relating to the day-to-day non-medical operations of the practices,
including (i) management and monitoring each practice's patient billings,
invoicing, and accounts receivable collection by payor type, (ii) accounting,
payroll, legal services and records, and (iii) cash management and centralized
disbursements. These services are designed to reduce the amount of time
physicians must spend on administrative duties, thereby enabling the physicians
to dedicate more of their efforts to the delivery of health care. The Company's
anticipated capital resources and assistance in budgeting and capital project
analysis are designed to assist the Regional Group Practices in establishing
facilities to provide ancillary footcare services.

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<PAGE>

As a result of the Transfers, the Company will employ the Affiliated
Practices' non-physician personnel. These non-physician personnel, along with
additional personnel at the Company's headquarters, will manage the day-to-day
non-medical operations of each of the Regional Group Practices by, among other
things, providing secretarial, bookkeeping, scheduling, and other routine
services. Under the Management Agreements, the Company will provide facilities
and equipment to the Regional Group Practices, and, to this end, the Company
intends to enter into new lease agreements or assume existing lease agreements
for the facilities and assets utilized and not owned by each of the Regional
Group Practices.

REGIONAL GROUP PRACTICES

At the closing of the Transactions, the DPM owners of Affiliated Practices
in a geographic area will become members of a Regional Group Practice. Each
Regional Group Practice will be a professional limited liability company
composed only of physician members who also enter into Physician Engagement
Agreements with the Regional Group Practice. Each Regional Group Practice will
be under one provider number for Medicare/Medicaid purposes. The Regional Group
Practices serve two principal purposes. First, they are designed to allow the
Company and the Affiliated Practices to work together in compliance with the
"group practice" exemption under the Stark amendments to the Social Security
Act. Second, the Regional Group Practice structure is an important mechanism
that allows the Company to achieve its business plan, as the Regional Group
Practices act as focal points for best practices, peer review, regional
marketing, practice expansions and additions, and resource exchanges.

Within the Regional Group Practices, individual DPMs will retain the
integrity of their practice revenues and expenses within that Regional Group
Practice. In addition, Regional Group Practices will separately determine
certain budget and personnel matters and each will have its own board of
managers elected by a majority of its members. Members will be subject to
certain standards for admission and may also be expelled in certain
circumstances. The member interests in the Regional Group Practice will be
subject to restrictions on transferability. The DPMs are subject to certain
restrictions on their ability to compete with the Regional Group Practices and
must pay certain liquidated damages upon their breach and/or termination of
their Physician Engagement Agreement. See "-- Operative Agreements -- Physician
Engagement Agreements."

The Company will enter into a 40-year Management Agreement with each
Regional Group Practice and, together, will establish a Joint Planning Committee
to develop long-term strategic objectives and management policies for the
operation of the Regional Group Practice and to facilitate communication and
interaction.

MANAGEMENT INFORMATION SYSTEMS

A key element in AMP's business strategy is implementing and using
sophisticated management information systems. The Company has developed a
comprehensive information systems plan that integrates a financial information
system (Lawson Software) and a physician practice management system (Medic
Vision). The Company expects to have these systems operating at the time of the
Offering to perform billing and collection services for all Affiliated
Practices. The Company's hardware platform will consist of two IBM RS 6000
minicomputers, running the financial and practice management software. If one
system fails, the other is expected to be used for both software applications.
Complete hardware and software deployment of the systems to most of the
Company's Affiliated Practices is expected to be completed within approximately
90 days after the Offering.

Billing and collections for the Regional Group Practices' services,
including financial accounting, accounts payable, other cash disbursements and
cash management will be performed centrally at the Company's headquarters in
Houston. Most of the Affiliated Practices will be networked to a central site
for billing, collections, and scheduling, assuring continuous communication,
through dedicated communication lines, among the Affiliated Practices and the
Company.

Most of the Affiliated Practices will have real time data access in order
to analyze on-going operations. Monthly financial data will also be available
through the network for most of the Affiliated Practices. In addition, the
Company intends to develop a data repository that will consolidate operational,
clinical,

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financial and outcomes data that will be used to develop pricing strategies and
to better report to and negotiate with managed care payors.

MANAGED CARE

The Company believes that podiatry, like many other medical specialties,
has been slow to achieve the integration and consolidation needed for survival
in the era of managed care. The rise of managed care and its emphasis on cost
containment and risk-sharing has placed podiatry's practitioners and small to
medium-size physician groups at a significant disadvantage. These practices
typically lack the capital to expand, develop or acquire information systems and
purchase new technologies, which often improve quality of care, reduce costs,
and increase profitability. These individual practices also tend to lack the
cost accounting and quality management systems necessary to allow physicians to
enter into sophisticated risk-sharing contracts with private and third-party
payors. Additionally, small to medium-size practices often do not have formal
ties with other providers, nor do they have the ability to offer a variety of
medical services, thus reducing their competitive position relative to larger
provider organizations. These smaller practices often have higher operating
costs because overhead must be spread over a relatively small revenue base and
have minimal purchasing power compared with suppliers.

A significant and increasing portion of the net revenues of podiatric
practices are expected to be derived from managed care payors. Although rates
paid by managed care payors are generally lower than commercial rates, managed
care payors provide access to large patient volumes. AMP intends to assist the
Affiliated Practices to compete effectively in the managed care framework and to
take advantage of the managed care payors' large patient volumes. To this end,
the Company plans to (i) perform analyses of the Regional Group Practices'
markets to develop managed care contracting strategies, (ii) meet with principal
payors in each market to enhance relationships between the Regional Group
Practices and the payors, (iii) negotiate attractive arrangements with managed
care payors leveraging the Affiliated Practices' combined size, and (iv) market
to managed care payors by emphasizing the Company's disease-specific treatment
programs, treatment protocols, ancillary services and information-sharing
capabilities.

GOVERNANCE

The Company's current governance structure promotes physician participation
in the management of the Company. Four physicians or medical experts will serve
on the Company's Board of Directors. In addition, each Regional Group Practice
will have a Joint Planning Committee whose membership will include an equal
number of representatives from the Regional Group Practice and the Company. The
Joint Planning Committee will have responsibilities that include developing
long-term strategic objectives, developing practice expansion and payor
contracting guidelines, promoting practice efficiencies, recommending
significant capital expenditures, and facilitating communication and information
exchange between the Company and each of the Regional Group Practices.

Concurrent with the Offering, the Company will create a Medical Policy
Board that will identify and communicate the best medical practices and
protocols through all the Regional Group Practices. This Medical Policy Board,
which will consist primarily of physicians from Regional Group Practices, will
receive managerial and information systems and administrative support from the
Company and develop patient outcome statistics. The Medical Policy Board will
initially consist of Stanley R. Kalish D.P.M., F.A.C.F.S., Chairman, Lawrence B.
Harkless D.P.M., Vice Chairman, Bernard J. Hersh, D.P.M., Vice Chairman, and
Robert G. Frykberg, D.P.M., M.P.H., Vice Chairman. See "Management -- Medical
Policy Board."

The Company will not exercise any responsibility on behalf of affiliated
physicians that could be construed as affecting the practice of medicine.
Accordingly, the Company believes that its operations do not violate applicable
state laws relating to the corporate practice of medicine. Such laws and legal
doctrines have been subjected to only limited judicial and regulatory
interpretation and there can be no assurance that, if challenged, the Company
would be considered in compliance with all such laws and doctrines. A
determination in any state that the Company is engaged in the corporate practice
of medicine could render

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any Management Agreement between the Company and a Regional Group Practice
located in such state unenforceable or subject to modification in a manner
adverse to the Company.

OPERATIVE AGREEMENTS

PURCHASE AGREEMENTS

The Purchase Agreements provide that the Company will acquire, and each DPM
will transfer to AMP, certain operating assets and receivables or stock of each
of the Affiliated Practices and AnestheCare, as the case may be. If the
conditions to closing in the Purchase Agreements are satisfied, the Company's
affiliations with the Affiliated Practices and the acquisition of AnestheCare
are expected to be consummated simultaneously with the closing of the Offering.

SAB 48 TRANSACTIONS

The Purchase Agreements with respect to the initial Affiliated Practices
accounted for under SAB 48 have the terms set forth below.

CONSIDERATION. The consideration to be paid by the Company for each of
these initial Affiliated Practices is being determined by arms-length
negotiations between the Company and a representative of each Affiliated
Practice. The aggregate consideration to be paid by the Company for these
initial Affiliated Practices is approximately $27.5 million, including the
assumption of $156,000 in indebtedness. The consideration is based upon the
Affiliated Practice's gross revenue, growth potential, quality of patients and
service delivery, and depth of presence in its local market.

The consideration to be paid for the initial Affiliated Practices will be
paid by a combination of cash, Common Stock of the Company, and the assumption
of certain debt.

COVENANTS. Each DPM agrees under their relevant Purchase Agreement that,
for a period of five years, he or she will not compete with the business of the
Affiliated Practice within 20 miles of any location of the Affiliated Practice's
Regional Group Practice at which the DPM has practiced podiatric medicine in the
prior year. Each DPM also will agree that during this time period, he or she
will not induce or attempt to induce any employee of the Regional Group Practice
or any of its affiliates to terminate his or her employment with the Regional
Practice Group. Additionally, the parties to the Purchase Agreement agree not to
disclose each other's confidential information.

INDEMNIFICATION. Under the Purchase Agreements, each DPM (to the extent of
their proportionate interest in the Affiliated Practice) and each Affiliated
Practice will be obligated to indemnify the Company and its subsidiaries for (i)
a breach of any representation, warranty or covenant of the Affiliated Practice
or any owner, (ii) any violation (or alleged violation) by the DPMs, the
Affiliated Practice or past or present affiliates of state or federal laws
governing healthcare fraud and abuse (including, but not limited to, fraud and
abuse in the Medicare and Medicaid programs) occurring on or before the Closing
or any overpayment or obligation (or alleged overpayment or obligation) arising
out of or resulting from claims submitted to any third party payor (including
the Medicare and Medicaid programs) on or before the Closing, or (iii) any
liability under any federal or state securities law or regulation arising out of
or based upon any untrue statement or alleged untrue statement of a material
fact relating to any DPM, the Affiliated Practice (including its subsidiaries),
or their Regional Group Practice and provided to the Company or its counsel by
the Affiliated Practice or its DPMs.

The Company will be obligated under the Purchase Agreements to indemnify
DPMs and the Affiliated Practices for (i) a breach by the Company of any of its
representations, warranties or covenants in the Purchase Agreement and (ii) any
liability under any federal or state securities law or regulation arising out of
or based upon an untrue statement or alleged untrue statement of a material fact
relative to the Company contained in this Prospectus, any preliminary
prospectus, the Registration Statement or any amendment or supplement arising
out of or based upon any omission or alleged omission to state a material fact
necessary to make the statements not misleading.

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ACCOUNTING TREATMENT. As a result of the transactions contemplated by the
Purchase Agreements, the historical balance sheet information of the Affiliated
Practices, excluding the Kramer Transfer and the Ambulatory Surgery Center
Acquisitions acquired in the Transfers, will be combined on a historical cost
basis in accordance with generally accepted accounting principles as if the
Affiliated Practices had always been members of the same group. Cash payments
attributed to non-monetary assets made to DPMs of Affiliated Practices under the
Purchase Agreements will be accounted for as a cash dividend. The net monetary
assets will be acquired at their fair market value which is expected to be
approximately $4.3 million.

CONDITIONS TO CONSUMMATION. The Company's obligation to consummate the
Closing under the Purchase Agreements is subject to a variety of conditions,
including, but not limited to, the following: (i) the formation of the Regional
Group Practice; (ii) the execution by the Regional Group Practice of a
management services agreement; (iii) the delivery of documents of conveyance;
(iv) the acquisition by the Company of all licenses, consents and permits, and
the provision of all notices, necessary for the Company and the Affiliated
Practices to continue their operations; (v) the absence of any injunction or
other proceeding to prohibit the Closing; and (vi) the satisfactory completion
by the Company of its due diligence investigation of the Affiliated Practices
through the Closing.

CONDUCT OF BUSINESS PENDING CLOSING. Pursuant to each Purchase Agreement,
each Affiliated Practice and its DPMs will agree that, until the Closing, the
Affiliated Practice will operate its business only in the usual, regular and
ordinary course, consistent with past practices, and will restrict certain
activities except with the prior written consent of the Company.

TERMINATION. Each Purchase Agreement and the transactions contemplated
thereby may be terminated prior to the Closing by the DPM or the Company if the
acquisition has not been consummated due to the failure of the Offering made
hereby.

RESALES. The Company's Common Stock to be delivered to DPMs under the
Purchase Agreements will not be registered under the Securities Act or any state
securities act and will be offered and sold in reliance upon exemptions from the
registration requirements of the Securities Act and such laws. Thus, Common
Stock issued pursuant to the Purchase Agreements will not be readily
transferable immediately. See "Shares Eligible for Future Sale."

Pursuant to each Purchase Agreement, each DPM receiving Common Stock has
agreed not to sell or otherwise dispose of any Common Stock during a 180-day
period after the Closing without the prior written consent of the underwriters
of the Offering made hereby.

NON-SAB 48 TRANSACTIONS

The Transfers from the Affiliated Practices will include the Ambulatory
Surgery Center Acquisitions. The acquisition of these assets will not qualify
for treatment under SAB 48 and will be accounted for as purchases for
consideration of $4.1 million payable in shares of Common Stock at the initial
public offering price, $1.0 million in cash, and $500,000 of assumed
indebtedness. The Purchase Agreement with respect to the AnestheCare Acquisition
and the Kramer Transfer are substantially similar to the Purchase Agreements
with respect to the Affiliated Practices, except for the differences noted
below.

ANESTHECARE AGREEMENT

The aggregate consideration to be paid for AnestheCare's assets is $4.5
million in cash. Additional consideration of up to $1.5 million in cash and
$500,000 payable in shares of Common Stock valued at the initial public offering
price will be held in escrow and may be paid to the owners of AnestheCare
pending AnestheCare's achievement of certain performance targets over a
three-year period beginning January 1, 1998. Pursuant to employment agreements
with each of Roger Bigham and David LaGuardia (each of whom owns 50% of
AnestheCare), in the event of the termination of the employment of Mr. Bigham or
Mr. LaGuardia by the Company without "Cause" or by such person for "Good
Reason," his options will immediately vest and he will be entitled to receive
an amount equal to the greater of (i) his base salary and an annual target bonus
payable over the remainder of his contract term or (ii) two times his annual
salary

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plus an annual target bonus. In addition, such person would be entitled to
receive a lump sum payment equal to the total amount of any excise taxes to
which such person may become subject under Section 4999 of the Internal Revenue
Code.

KRAMER AGREEMENT

The aggregate consideration to be paid for Dr. Kramer's stock in the Kramer
Transfer is $1,404,000, all of which will be paid in cash. In addition, unlike
other Affiliated Practice Transfers, AMP will have no on-going relationship with
Dr. Kramer, including no post-closing Management Agreement or Physician
Engagement Agreement.

MANAGEMENT AGREEMENTS

The following summary of the Management Agreements is a general summary of
the form of Management Agreement. The Company expects to enter into similar
agreements with the future Affiliated Practices. The terms of the individual
Management Agreements into which the Company may enter in the future may vary
from the description below as a result of negotiations with individual practices
and the requirements of local regulations.

Pursuant to the Management Agreements, the Company, among other things,
will (i) act as the exclusive manager and administrator of non-physician
services relating to the operation of the Regional Group Practices, subject to
matters for which the Regional Group Practices maintain responsibility or which
are referred to the board of managers of the Regional Group Practices, (ii) bill
patients, insurance companies and other third party payors and collect, on
behalf of the Regional Group Practices, the fees for professional medical and
other services rendered, including goods and supplies sold by the Regional Group
Practices, (iii) provide or arrange for, as necessary, clerical, accounting,
purchasing, payroll, legal, bookkeeping and computer services and personnel,
information management, preparation of certain tax returns, printing, postage
and duplication services, and medical transcribing services, (iv) maintain
custody of substantially all files and records relating to the operation of the
Regional Group Practices and supervise preparation of patient medical records
(medical records of the Regional Group Practices are confidential and remain the
property of the Regional Group Practices), (v) provide and maintain facilities
for the Regional Group Practices, and provide the Regional Group Practices with
the use of equipment, furniture, fixtures, furnishings, and other personal
property, (vi) prepare, in consultation with the Joint Planning Committee and
the Regional Group Practices, all annual and capital operating budgets, (vii)
order and purchase inventory and supplies as reasonably requested by the
Regional Group Practices, (viii) implement, in consultation with the Joint
Planning Committee and the Regional Group Practices, national and local
marketing or advertising programs, (ix) employ or otherwise retain all necessary
management, administrative, clerical, secretarial, bookkeeping, accounting,
payroll, billing and collections, and other personnel, (x) provide financial and
business assistance in the negotiation, establishment, supervision and
maintenance of contracts and relationships with managed care, and other similar
providers and payors, (xi) assist each Regional Group Practice in fulfilling its
obligations to its patients to maintain a high quality of medical and
professional services, and (xii) provide such consulting and other advisory
services as requested by each Regional Group Practice in all areas of the
respective Regional Group Practice's business functions, including, without
limitation, financial planning, acquisition and expansion strategies,
development of long-term business objectives and other related matters. The
Company expects that most employees of the Affiliated Practices will be retained
after the consummation of this Offering.

Under the Management Agreements, the Regional Group Practices will retain
the responsibility for, among other things, (i) hiring, compensating,
supervising, training, evaluating and terminating its physician employees and
certain other medical professionals, (ii) ensuring that physicians have the
required licenses, credentials, approvals and other certifications needed to
perform their duties, (iii) complying with certain federal and state laws and
regulations applicable to the practice of medicine, and (iv) matters involving
its corporate governance, employees and similar internal matters, including but
not limited to preparation and the contents of reports to regulatory authorities
and distribution of professional fee income. In addition, the

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Regional Group Practices will maintain exclusive control of all aspects of the
practice of medicine and the delivery of medical services.

The Management Agreement provides for the establishment of a Joint Planning
Committee which will consist of three members designated by the Company and
three members designated by the respective Regional Group Practice. The Joint
Planning Committee will be responsible for developing long-term strategic
planning objectives and management policies for the overall operation of each
Regional Group Practice and will have the authority to (i) develop and assist
each Regional Group Practice in implementing both long-term strategic objectives
and short-term operating plans, (ii) prepare proposals and make recommendations
to the Board of Directors of AMP regarding significant capital expenditures,
contractual arrangements, capital improvement and expansion projects on behalf
of each Regional Group Practice, (iii) with assistance of the Company, prepare
the annual capital and operating budgets of each Regional Group Practice, (iv)
consider and make recommendations regarding grievances pertaining to matters not
specifically addressed in the Management Ageeement if such matters are referred
to it by each Regional Group Practice or the Company, (v) make recommendations
to each Regional Group Practice regarding the performance, number and type of
physicians required for the efficient operation of each Regional Group Practice,
and (vi) make decisions and recommendations regarding the business plan of each
Regional Group Practice.

The Company will also generally be entitled to a fee of approximately 70%
of the adjusted ancillary revenues, net of related ancillary expenses, of each
Regional Group Practice. Ancillary revenues will be generated from services
provided by the Regional Practice Group to its patients that are ancillary to
DPM podiatric care (such as orthopedics, ambulatory care, physical therapy and
the like). In connection with the AnestheCare Acquisition, the Company will
retain the existing financial and fee arrangements of AnestheCare with its
clients (other than the Regional Group Practices). After the AnestheCare
Acquisition, services provided by AnestheCare to the Regional Group Practices
will be delivered on a discounted basis, and AMP will receive a fee of
approximately 70% of AnestheCare's adjusted ancillary revenues net of related
ancillary expenses.

The Management Agreements will have initial terms of 40 years, with
automatic extensions (unless specified notice is given) of additional ten-year
terms. The Management Agreements may be terminated by either party if the other
party (i) files a petition in bankruptcy or other similar events occur or (ii)
defaults on the performance of a material duty or obligation, which default
continues for a specified term after notice, and, in the case of the Regional
Group Practice, has also been approved by 80% of the equity holders of the
Regional Group Practice. In addition, the Company may terminate the agreement if
the Regional Group Practice or any physician (i) engages in conduct or is
formally accused of conduct that would subject his or her license to practice
medicine to be revoked or (ii) is otherwise disciplined by any licensing,
regulatory or professional entity or institution, if the result of any event
described in clause (i) or (ii) reasonably would be expected to materially
adversely affect the Regional Group Practice.

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During the term of the Management Agreement and for a period of one year
thereafter, the Regional Group Practices agree not to compete with the Company
in providing services similar to those provided by the Company or by any
Regional Group Practice anywhere generally within 20 miles of any location at
which any physician of the Regional Group Practice has practiced medicine in the
last year. Each Regional Group Practice also agrees that any and all
confidential and proprietary information acquired by the Regional Group Practice
during the term of the Management Agreement is the property of the Company and
agrees to hold in strictest confidence such confidential and proprietary
information. In addition, the Physician Engagement Agreement makes the Company a
third party beneficiary of the Physician Engagement Agreement including
covenants not to compete with and not to divulge confidential and properietary
information of the Company and the Regional Group Practice and liquidated
damages provisions therein. The Physician Engagement Agreements generally
require the Regional Group Practices to pursue enforcement of these provisions
or to assign to the Company the right to pursue enforcement. Furthermore, the
Company may require the Group Practice to pay liquidated damages owed by a
departing physician before those damages are collected by the Regional Group
Practice.

The Regional Group Practices will be responsible for obtaining professional
liability and worker's compensation insurance for the physicians and other
medical employees of the Regional Group Practices, as well as general liability
umbrella coverage. The Company is responsible for obtaining professional
liability and worker's compensation insurance for employees of the Company and
arranging for general liability and property insurance for the Regional Group
Practices.

The Management Agreements contain indemnification provisions pursuant to
which the Company will indemnify the Regional Group Practices for damages
resulting from negligent acts or omissions by the Company and/or its
stockholders, employees and/or subcontractors (other than the Regional Group
Practice and its employees). In addition, the Regional Group Practices will
indemnify the Company for any damages resulting from any negligent act or
omissions by the Regional Group Practice and/or shareholders, employees and/or
subcontractors (other than the Company or its employees) of the Regional Group
Practices, resulting from claims arising from the performance of medical
services or other intentional or negligent acts or omissions to act. The Company
also agrees to indemnify the Regional Group Practices in connection with its
failure to perform its obligations under the Management Agreement.

PHYSICIAN ENGAGEMENT AGREEMENTS

In addition to becoming a member of a Regional Group Practice, each DPM
will enter into a Physician Engagement Agreement with that Regional Group
Practice. Pursuant to the Physician Engagement Agreements, the Regional Group
Practices will engage the DPMs to provide certain medical services to patients
at the Group Practices offices. During the term of engagement, the DPM will
practice medicine only as a participant in the Regional Group Practice, will
practice medicine on a full-time basis at the Regional Group Practice offices,
and will perform such other duties as are reasonably assigned to and accepted by
the DPM including, among other things (i) providing "on duty" and "on call"
services on an equal rotating basis with other physician members of the Regional
Group Practice, (ii) keeping and maintaining on a timely basis appropriate
records relating to all professional services rendered and attending to all
billing reports, claims and correspondence required in connection with services
rendered, and (iii) complying with reasonable and necessary policies and
procedures adopted by the Regional Group Practice. In addition, the DPM will
continue to be licensed to practice medicine, will be or will become Board
certified, will participate in continuing medical education programs and
seminars, and will obtain and maintain an American Podiatric Medical Association
C.M.E. certificate, or its equivalent. The DPM will also take any action
reasonably required to obtain key man life insurance covering the DPM and naming
the Regional Group Practice and/or its management services provider as exclusive
beneficiaries.

Each Physician Engagement Agreement has an initial term of five years
(unless terminated as set forth below) and is automatically renewed for
successive two-year periods unless terminated in accordance the agreement terms
(the "Term"). Termination occurs upon (i) the death of the DPM, (ii) the
disability of the DPM, or (iii) at the Regional Group Practice's option for
"cause," which term includes (a) the failure of the DPM to perform the duties
required in a reasonably satisfactory manner, (b) material dishonesty, fraud

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or gross negligence by the DPM, (c) the conviction of the DPM of a felony or
other crime involving moral turpitude, (d) violation of the non-competition or
non-disclosure provisions of the Physician Engagement Agreement, (e) unlawful
use or other misuse of drugs or alcohol by the DPM, (f) failure by the DPM to
maintain DPM's license to practice, (g) failure to obtain and/or maintain Board
certification in podiatric medicine by an acceptable certifying organization
within two years, or (h) the termination, cancellation or revocation of the
medical malpractice insurance due to an act or omission by the DPM.

For a period beginning at the beginning of the Term and ending one year
after the end of the Term, the DPM may not, without consent of the Regional
Group Practice, own an entity engaged in a business the same as or substantially
similar to the business of a Regional Group Practice or in a business that
competes in any manner with the business of the Regional Group Practice and that
is generally located or intended to be located within a radius of 20 miles of
the offices of the Regional Group Practice at which the DPM has practiced
podiatry in the last year. In addition, the DPM may not, during the same period,
disclose or use any confidential material relating to any aspect of the business
of the Regional Group Practice or any information regarding business methods,
policies, procedures, techniques or trade secrets of the Regional Group
Practice, its affiliates or entities in which the Regional Group Practices have
an interest. The DPM may not act for any person or entity which employs or
contracts with any person or entity employed by or an agent or consultant to the
Regional Group Practice. Finally, in the event that the DPM terminates the
Physician Engagement Agreement, the DPM must pay liquidated damages in an amount
approximately equal to the twelve months of the Affiliated Practice expenses
attributable to the DPM and agreed to by the Company at the time the Purchase
Agreement was executed.

In addition, the Company has agreed to make available to the Regional Group
Practices for each DPM owner a loan in an amount equal to (i) an advance on the
first monthly draw of such DPM, (ii) the difference between 90% of the prior
year's level of distributions and the current period's level of distributions
from the practice for the first three months, and (iii) the difference between
80% of the prior year's level of distribution and the current period's level of
distribution for the second three months following the Offering. The loan, if
drawn, is repayable over two years and bears a market rate of interest.

COMPETITION

The Company competes with many other entities to affiliate with podiatric
practices. Several companies that have established operating histories and
greater resources than the Company are pursuing the acquisition of the assets of
general and specialty practices and the management of such practices. Physician
practice management companies and some hospitals, clinics and HMOs engage in
activities similar to the activities of the Company. There can be no assurance
that the Company will be able to compete effectively with these competitors,
that additional competitors will not enter the market, or that this competition
will not make it more difficult to affiliate with, and to enter into agreements
to provide management services to, practices on terms beneficial to the Company.

Regional Group Practices will compete with other local podiatric care
service providers, as well as some managed care organizations. The Company
believes that changes in government and private reimbursement policies and other
factors have resulted in increased competition for consumers of medical
services. The Company believes that the cost, accessibility and quality of
services provided are the principal factors that affect competition. There can
be no assurance that the Regional Group Practices will be able to compete
effectively in the markets that they serve. The inability of the Regional Group
Practices to compete effectively would materially adversely affect the Company.

Further, the Regional Group Practices compete with other providers for
managed care podiatric care contracts. The Company believes that trends toward
managed care have resulted in increased competition for these contracts. Other
practices and management service organizations may have more experience than the
Regional Group Practices and the Company in obtaining these contracts. There can
be no assurance that the Company or the Regional Group Practices will be able to
successfully acquire sufficient managed care contracts to compete effectively in
the markets they serve. The inability of the Regional Group Practices to compete
effectively for these contracts could materially adversely affect the Company.

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GOVERNMENT REGULATION

The delivery of health care services has become one of the most highly
regulated professional and business endeavors in the United States. Both the
federal government and the individual state governments are responsible for
overseeing the activities of individuals and businesses engaged in the delivery
of health care services. Federal law and regulations are based primarily upon
the Medicare program and the Medicaid program, each of which is financed, at
least in part, with federal funds. State jurisdiction is based upon the state's
interest in regulating the quality of health care in the state, regardless of
the source of payment.

The Company believes its operations will be in material compliance with
applicable laws; however, the Company has not received or applied for a ruling
from any federal or state judicial or regulatory authority to this effect, and
many aspects of the Company's business operations have not been the subject of
state or federal regulatory interpretation.

FEDERAL LAW

The federal health care laws apply in any case in which a Regional Group
Practice is providing an item or service that is reimbursable under Medicare or
Medicaid or other federal health care programs or in which the Company is
claiming reimbursement from Medicare, Medicaid, other federal health care
programs or, in some instances, other third party payors on behalf of physicians
with whom the Company has a Management Agreement. The principal federal laws
include those that prohibit the filing of false or improper claims, those that
prohibit unlawful inducements for the referral of business reimbursable under
Medicare, Medicaid or other federal healthcare programs and those that prohibit
the provision of certain services by (a) a provider to a patient if the patient
was referred by a physician with which the provider has certain types of
financial relationships or (b) a provider who is excluded from Medicare,
Medicaid or other federal health care programs.

FALSE AND OTHER IMPROPER CLAIMS. The federal government is authorized to
impose criminal, civil and administrative penalties and/or exclusions on any
health care provider and its officers, directors, and in certain limited
circumstances, its owners that files a false claim or a pattern of claims based
on a code that the provider has reason to know will result in greater payments
than appropriate, claims for items or services not medically necessary, or for
the offer, solicitation, payment or receipt of anything of value (direct or
indirect, overt or covert, in cash or in kind), that is intended to induce the
referral of federal health care program patients or the ordering of items or
services reimbursable under those programs or the recommendation of, or the
arranging for, the provision of items or services reimbursable under Medicare
and Medicaid. Civil monetary penalties can also be imposed if a person
"arranges or contracts" with a person excluded from a federally funded health
care program, if they knew or should have known such person was excluded for
reimbursement from Medicare or Medicaid. Criminal penalties are also available
in the case of claims filed with private insurers if the government can show
that the claims constitute mail fraud, wire fraud, health care fraud, theft, or
embezzlement in connection with health care or false statements relating to
healthcare matters. While the criminal statutes are generally reserved for
instances evincing an obviously fraudulent intent, the criminal and
administrative penalty statutes are being applied by the government in an
increasingly broad range of circumstances. The government has taken the
position, for example, that a pattern of claiming reimbursement for unnecessary
services violates these statutes if the claimant should have known that the
services were unnecessary. The government has also taken the position that
claiming reimbursement for services that are substandard is a violation of these
statutes if the claimant should have known that the care was substandard. The
government, in cases of suspected fraud, can freeze the assets of a health care
provider and in the case of a federal health care offense can order the
forfeiture of assets that constitute or are derived from proceeds traceable to
the offense.

The Company believes that its billing activities on behalf of the Regional
Group Practices will be in material compliance with these laws, but there can be
no assurance that the Company's activities will not be challenged or scrutinized
by government authorities. A determination that the Company had violated these
laws could have a material adverse effect on the Company.

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ANTI-KICKBACK LAW. A federal law commonly known as the "Anti-Kickback
Law" prohibits the offer, solicitation, payment or receipt of anything of value
(direct or indirect, overt or covert, in cash or in kind), that is intended to
induce the referral of federal health care program patients or the ordering of
items or services reimbursable under those programs. The law also prohibits
remuneration that is intended to induce the recommendation of, or the arranging
for, the provision of items or services reimbursable under Medicare and
Medicaid. The law has been broadly interpreted by a number of courts to prohibit
remuneration that is offered or paid for otherwise legitimate purposes if the
circumstances show that one purpose of the arrangement is to induce referrals.
Even bona fide investment interests in a health care provider may be questioned
under the Anti-Kickback Law if the government concludes that the opportunity to
invest was offered as an inducement for referrals. The penalties for violations
of this law include criminal sanctions and exclusion from the federal health
care program.

In part to address concerns regarding the implementation of the
Anti-Kickback Law, the federal government in 1991 published regulations that
provide exceptions or "safe harbors" for certain transactions that will not be
deemed to violate the Anti-Kickback Law. Among the safe harbors included in the
regulations were provisions relating to the sale of physician practices,
management and personal services agreements and employee relationships.
Subsequently, regulations were published offering safe harbor protection to
additional activities, including referrals within group practices consisting of
active investors. Proposed amendments clarifying the existing safe harbor
regulations were published in 1994. If any of the proposed regulations are
ultimately adopted, they would result in substantive changes to existing
regulations. The failure of an activity to qualify under a safe harbor
provision, while potentially leading to greater regulatory scrutiny, does not
render the activity illegal.

There are several aspects of the Company's relationships with physicians to
which the Anti-Kickback Law may be relevant. In some instances, for example, the
government may construe some of the marketing and managed care contracting
activities of the Company as arranging for the referral of patients to the
physicians with whom the Company has a Management Agreement.

Although neither the investments in the Company by physicians nor the
Management Agreements between the Company and the Regional Group Practices
qualify for protection under the safe harbor regulations, the Company does not
believe that these activities fall within the type of activities the Anti-
Kickback Law was intended to prohibit. A determination that the Company had
violated the Anti-Kickback Law would have a material adverse effect on the
Company.

The Civil Monetary Penalties law also prohibits offering remuneration
prohibited under the anti-kickback laws and offering remuneration to an
individual eligible for Medicare or Medicaid benefits to induce that person to
order or receive any reimbursable item or service from a particular person.
Violations of the Civil Monetary Penalties law can result in the imposition of
significant civil penalties.

STARK SELF-REFERRAL LAW. The Stark Self-Referral Law (the "Stark Law")
prohibits a physician from referring a patient to a health care provider for
certain designated health services reimbursable by Medicare or Medicaid if the
physician has a direct or indirect financial relationship with that provider,
including an investment interest, a loan or debt relationship or a compensation
relationship. In addition to the conduct directly prohibited by the law, the
statute also prohibits schemes that are designed to obtain referrals indirectly
that cannot be made directly. The penalties for violating the law include (i) a
refund of any Medicare or Medicaid payments for services that resulted from an
unlawful referral, (ii) civil fines, and (iii) exclusion from the Medicare and
Medicaid programs.

The Company will provide or arrange for the provision of designated health
service under the Stark Law. Because the Company will provide management
services related to those designated health services provided by physicians
affiliated with the Regional Group Practices, the Company will likely be deemed
the provider of those services for purposes of the Stark Law and, accordingly,
the recipient of referrals from physicians affiliated with the Regional Group
Practices. In that event, such referrals will be permissible only if (i) the
financial arrangements under the Management Agreements with the Regional Group
Practices meet certain exceptions in the Stark Law and (ii) the ownership of
stock in the Company by the referring physicians meets certain investment
exceptions under the Stark Law. The Company believes that the

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financial arrangements under the Management Agreements qualify for applicable
exceptions under the Stark Law. However, there can be no assurance that a review
by courts or regulatory authorities would not result in a contrary
determination. In addition, the Company will not meet the Stark Law exception
related to investment interest until the Company's stockholders' equity exceeds
$75 million.

On January 9, 1998, HCFA published proposed Stark rules to incorporate the
provisions of the Stark Law into the Regulations with respect to designated
health services other than Clinical Laboratory Services. These regulations
provide, in the case of designated health services provided by a group practice,
that the overhead expenses of and the income from the practice must be
distributed according to methods that indicate that the practice is a unified
business and not based on each satellite office operating as if it were a
separate enterprise. While management believes that the overhead expenses of and
the income from each Regional Group Practice will be distributed according to
methods that indicate that the practice is a unified business, there can be no
assurance that the Regional Group Practices' distribution methodology will not
be challenged or scrutinized by governmental authorities. A determination that
the Regional Group Practices sharing of overhead expenses and income did not
comply with Stark would preclude referrals to certain designated health services
operated by the Company and could have a material adverse effect on the Company.

STATE LAW

STATE ANTI-KICKBACK LAWS. Many states have laws that prohibit payment of
kickbacks in return for the referral of patients. Some of these laws apply only
to services reimbursable under state Medicaid programs. However, a number of
these laws apply to all health care services in the state, regardless of the
source of payment for the service. Based on court and administrative
interpretation of federal anti-kickback laws, the Company believes that these
laws prohibit payments to referral sources where a purpose for payment is for
the referral. However, the laws in most states regarding kickbacks have been
subjected to limited judicial and regulatory interpretation. Therefore, no
assurances can be given that the Company's activities will be found to be in
compliance. Noncompliance with these laws could have an adverse effect upon the
Company and subject it and physicians affiliated with the Regional Group
Practices to penalties and sanctions.

STATE SELF-REFERRAL LAWS. A number of states have enacted self-referral
laws that are similar in purpose to the Stark Law but which impose different
restrictions. Some states, for example, only prohibit referrals when the
physician's financial relationship with a health care provider is based upon an
investment interest. Other state laws apply only to a limited number of
designated health services. Some states do not prohibit referrals but require
only that a patient be informed of the financial relationship before the
referral is made. The Company believes that its operations are in material
compliance with the self-referral law of the states in which the Regional Group
Practices are located.

FEE-SPLITTING LAWS. Many states prohibit a physician from splitting with a
referral source the fees generated from physician services. Other states have a
broader prohibition against any splitting of a physician's fees, regardless of
whether the other party is a referral source. In most states, it is not
considered to be fee-splitting when the payment made by the physician is
reasonable reimbursement for services rendered on the physician's behalf.

The Company will be reimbursed by physicians on whose behalf the Company
provides management services. The compensation provisions of the Management
Agreements have been designed to comply with applicable state laws relating to
fee-splitting. There can be no certainty, however, that if challenged, the
Company and its Regional Group Practices will be found to be in compliance with
each state's fee-splitting laws. A determination in any state that the Company
is engaged in any unlawful fee-splitting arrangement could render any service
Management Agreement between the Company and a Regional Group Practice located
in such state unenforceable or subject to modification in a manner adverse to
the Company.

A recent decision by the Florida State Medical Board held that payments by
a physician to a non-physician practice management company which were based on a
percentage of the physician's income constituted fee splitting. While the
Company's Management Agreements are not based upon a percentage of any
physician's net income, there can be no assurance that the compensation
methodology will not be

43
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challenged or scrutinized by governmental authorities. A determination that the
Company's compensation methodology did not comply with applicable fee splitting
could have a material adverse effect on the Company. It must, however, be noted
that the Florida decision is under appeal and no prediction can be made as to
the outcome of the appeal.

CORPORATE PRACTICE OF MEDICINE. Most states prohibit corporations from
engaging in the practice of medicine. Many of these state doctrines prohibit a
business corporation from employing a physician. States differ, however, with
respect to the extent to which a licensed physician can affiliate with corporate
entities for the delivery of medical services. Some states interpret the
"practice of medicine" broadly to include activities of corporations such as
the Company that can have an indirect impact on the practice of medicine, even
where the physician rendering the medical services is not an employee of the
corporation and the corporation exercises no discretion with respect to the
diagnosis or treatment of a particular patient.

INSURANCE LAWS. Laws in all states regulate the business of insurance and
the operation of HMOs. Many states also regulate the establishment and operation
of networks of health care providers. While these laws do not generally apply to
companies that provide management services to networks of physicians, there can
be no assurance that regulatory authorities of the states in which the Company
operates would not apply these laws to require licensure of the Company's
operations as an insurer, as an HMO or as a provider network. The Company
believes that its proposed operations are in compliance with these laws in the
states in which it currently does business, but there can be no assurance that
future interpretations of insurance and health care network laws by regulatory
authorities in these states or in the states into which the Company may expand
will not require licensure or a restructuring of some or all of the Company's
operations.

EMPLOYEES AND AFFILIATED PERSONS

Upon the consummation of the Offering, the Company expects to employ about
199 staff personnel of the initial Affiliated Practices and 29 people at the
corporate headquarters in Houston, Texas. AMP intends to provide benefits, to
include health, life, disability and 401(k) components, to the employees of the
Regional Group Practices and to make available, at the Regional Group Practices'
own expense, to the approximately 66 DPMs similar benefits. The Company intends
to outsource the personnel administration function as well as the benefits
component to a Professional Employer Organization and is currently in the
process of evaluating and selecting a provider. The Company feels this will
enable it to more efficiently manage human resource risks, implement the
management of a geographically diversified workforce more quickly, offer a more
comprehensive benefits packages, and realize overall cost efficiencies. As the
Company grows, it will continually reevaluate this decision, and may eventually
decide to hire additional employees to perform these functions. The Company
believes that its relationship with its employees is good. None of the Company's
employees have entered into a collective bargaining agreement.

LEGAL PROCEEDINGS AND INSURANCE

The Company is not party to any litigation. However, if the Regional Group
Practices become subject to litigation involving medical malpractice or any
other claims, the Company may become involved. The Company has acquired medical
malpractice insurance that will be effective upon consummation of the Offering.
See "Risk Factors -- Liability and Insurance Risks Associated with Podiatric
Practices." In addition, in connection with the purchase of the stock of
certain Affiliated Practices, the Company will assume certain liabilities of
such practices.

PROPERTIES

The Company leases approximately 16,000 square feet of office space at its
headquarters in Houston, Texas. In addition, in connection with the
Transactions, the Company will enter into leases for the facilities utilized by
the initial Affiliated Practices and AnestheCare, and will purchase certain real
estate from Dr. Kramer in Decatur, Georgia, as part of the Kramer Transfer.

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MANAGEMENT

DIRECTORS AND EXECUTIVE OFFICERS

The authorized number of directors on the Company's Board will be seven.
Immediately prior to the closing of the Offering, the Board will be divided into
three classes, as nearly equal in number as possible, with the initial term of
office of Class I directors to expire at the first annual meeting of
stockholders, the initial term of office of Class II directors to expire at the
second annual meeting of stockholders, and the initial term of office of Class
III directors to expire at the third annual meeting of stockholders, each class
of directors to hold office until their successors have been duly elected and
qualified. The Class III Directors will be Mr. McCrary, Mr. Bertsch, and Dr.
Kalish. The Class II Directors will be Dr. Hartley and Mr. Bace. The Class I
Directors will be Dr. Huge and another DPM to be elected by the holders of Class
B Common Stock.

The table below sets forth information with respect to those individuals
who are currently expected to serve as directors and executive officers of the
Company immediately following the Closing.

<TABLE>
<CAPTION>
NAME AGE POSITION
- ---------------------------------------- --- ---------------------------------------------------------------
<S> <C>
Jack N. McCrary......................... 60 Chairman of the Board of Directors, President and Chief
Executive Officer
Wayne A. Bertsch........................ 55 Senior Vice President, Chief Financial Officer,
Treasurer, Secretary and Director
Randy E. Johnson........................ 43 Senior Vice President -- Regional Operations Officer
Kenneth Arrowood........................ 59 Vice President -- Development
Roger Bigham............................ 46 Vice President of the Company and Chief Operating Officer of
AnestheCare
Joseph D. Grau.......................... 43 Vice President -- Regional Operations Officer
David LaGuardia......................... 37 Vice President -- Ancillary Support Services
Randee H. Lehrer........................ 39 Vice President--Managed Care Relations
Cecil R. Pickens........................ 33 Vice President and Chief Accounting Officer
John S. Bace, CFA....................... 66 Director
S.F. "Charley" Hartley, D.P.M.,
F.A.C.F.S............................. 53 Director
Donald S. Huge, M.D..................... 67 Director
Stanley R. Kalish, D.P.M., F.A.C.F.S.... 51 Director and Chairman, Medical Policy Board
</TABLE>

These directors and executive officers are considered "promoters" of the
Company. See "Certain Transactions."

JACK N. MCCRARY has been Chairman, President and Chief Executive Officer of
the Company since March 1996 and is a founder and organizer of the Company. Mr.
McCrary has been active in the executive management of entities involved in the
U.S. health care industry since 1970. Most recently, beginning in April 1984 he
co-founded five Houston, Texas medical facilities and has served as Vice
Chairman of Doctors Hospital Airline since April 1984, Vice Chairman and
President of Doctors Hospital East Loop since February 1987, Vice Chairman and
President of Kingwood Plaza Hospital since May 1990, Vice Chairman and President
of Plaza Rehabilitation Hospital at Kingwood since July 1991, and Vice Chairman
and President of Kingwood Medical Plaza since May 1990. Since 1995, these
organizations have been in the process of winding down/selling their operations
to Columbia/HCA. Prior to this, Mr. McCrary was with Lifemark Corporation as its
Chief Financial Officer, which included corporate development responsibilities.
During his years at Lifemark, Mr. McCrary served in the capacities of Director,
Member of the Executive Committee, Member of the Finance Committee, and
President of two of Lifemark's operating subsidiaries. Mr. McCrary has also been
responsible for developing 13 lithotripter centers, while serving as the
founding President of URO-Tech Corporation and has served as President of
Medi-Magnetics, Inc., a medical device company. Mr. McCrary also has served as
the Chairman of the Board of Trustees of the Texas A&M Research Foundation since
November 1989. Mr. McCrary received a B.S. in Mechanical Engineering from Texas
A&M University in 1959 and an M.B.A. from Harvard Graduate School of

45
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Business Administration in 1965 and completed the Executive Advanced Management
Program at the University of Texas in 1968.

WAYNE A. BERTSCH has been Senior Vice President, Chief Financial Officer
and Treasurer since October 1997. Mr. Bertsch was previously Vice
President -- Regional Operations Officer of the Company from August 1996 to
August 1997. From September 1995 to August 1996, Mr. Bertsch served as Business
Manager of Hermann Hospital Home Health, an agency based in a large,
not-for-profit, university-affiliated medical center. Mr. Bertsch was associated
with Medical Innovations, Inc. as a Director of its Hospital Home Care Division
from January 1993 to August 1995. He also served as Vice President-Finance for
Preferred Homecare, Inc. and a related entity, Preferred Pharmacy, Inc., from
April 1991 to December 1992. Mr. Bertsch has been active in the U.S. health care
industry in various capacities since 1970, including 14 years with Lifemark
Corporation where he had increasing roles of responsibility in the financial and
operational performance of Lifemark. He has been responsible for cash management
billing and collection of professional and management fees, and audited
financial and operational reporting, for partnerships and corporations. Mr.
Bertsch received a B.A. in Economics and Business Administration in 1965 and a
B.S. in Accounting in 1966 from Rice University and is a Certified Public
Accountant.

RANDY E. JOHNSON has been Senior Vice President-Regional Operations Officer
for the Regional Group Practices of Atlanta, Houston, Miami and South Texas
since October 1997 and was Vice President -- Regional Operations Officer of AMP
from August 1996 to August 1997. From February 1991 to August 1996, Mr. Johnson
held various senior operating management positions with Mid-America Health Care
Group and some of its affiliated hospital organizations, including serving as
the organizing and founding Administrator at Kingwood Plaza Rehabilitation
Hospital. He has held various senior management positions over entities involved
in the U.S. health care market since September 1979. Mr. Johnson received a
B.B.A. in Finance from the University of Texas in 1979 and an M.S. in Health
Service Administration from the University of Houston at Clear Lake in 1981.

KENNETH R. ARROWOOD joined the Company as Vice President-Development on
September 9, 1997. Prior to that he had been a consultant for the Company since
April 1997. Before joining the Company, Mr. Arrowood served for two years as the
Chief Executive Officer & Founder of Management Service Organization, Inc., a
physician practice management company. Prior to Management Services
Organization, Inc., Mr. Arrowood has served as the Chief Executive Officer &
Founder of Provider Management Services, Inc., an orthopedic, imaging and
physical therapy practice management company since 1989. Prior to 1989, Mr.
Arrowood served as the Chief Executive Officer & Founder for The Gains Group,
Inc., a physician recruiting and turn-key medical practice installation
consultant for hospitals from 1988 to 1989, and as Chief Executive Officer &
Founder for the Allenwood Group, Inc., a national executive recruitment and
Human Resource consulting firm from 1979 to 1986.

ROGER BIGHAM will serve as the Company's Vice President and as the Chief
Operating Officer of AnestheCare, Inc., which will become a wholly-owned
subsidiary of the Company upon its acquisition by the Company in connection with
the Offering. Mr. Bigham has been the President and CEO of Pyramid
Anesthesiology Group, Inc. and AnestheCare (collectively "AnestheCare") since
1984. In addition to serving as a certified registered nurse anesthetist, Mr.
Bigham has served as a clinical instructor at Mission Memorial Hospital from
1977-1982 and as a head of the Anesthetist Department for Humana Hospitals from
1984-1987. Mr. Bigham earned his Registered Nurse Associate Degree from Pima
College in Tucson, Arizona and in 1982 his B.S. in Nurse Anesthesiology at
Warren Wilson College in Swannanoa, North Carolina. Mr. Bigham is an active
member in the Anesthesia Administrators Assembly, the Ambulatory Surgery
Society, the Financial Management Society, the Healthcare Financial Management
Association, the American College of Healthcare Executives, and the American
Association of Nurse Anesthetists.

JOSEPH D. GRAU has served as the Vice President -- Regional Operations
Officer for the Regional Group Practices of North Texas, St. Louis, and Maryland
since October 1997. From February 1994 to the time of his joining the Company,
Mr. Grau was President, Southwest Region for Physician Management Group, Inc.
("Physician Management"). At Physician Management, Mr. Grau was responsible
for analyzing, evaluating, and providing creative solutions in connection with
his provision of practice management

46
<PAGE>
consultative services to numerous medical practices. From March 1989 to January
1994, Mr. Grau served as Vice President of Nix Healthcare System, a
multi-facility hospital management company. From April 1987 to February 1989,
Mr. Grau served as the Administrator of Willis-Knighton South Hospital, prior to
which Mr. Grau served from July 1985 to March 1987 as the Executive Director of
Riverside Community Hospital and Byrd Memorial Hospital, both hospitals being
owned by American Medical International, Inc. From March 1984 to July 1985, Mr.
Grau was the Administrator of Littlefield Medical Center. Mr. Grau has been
involved in healthcare since 1978. Mr. Grau received his B.A. in accounting in
1976 and his M.B.A. in 1979, both from Auburn University.

DAVID LAGUARDIA will join the Company upon the Offering as its Vice
President--Ancillary Support Services. In 1984, Mr. LaGuardia co-founded
AnestheCare, and has served as its Vice President and Chief Financial Officer
since its inception. In 1987, Mr. LaGuardia co-formed Professional Therapy
Service Incorporated, now Georgia Rehabilitation Corporation, Inc. and has
served as its President and Chairman since then. Mr. LaGuardia is a board
certified registered nurse anesthetist, having received his nurse anesthetist
certificate from Montgomery School of Anesthesia in Philadelphia in 1980 and his
board certification in 1983.

RANDEE H. LEHRER became Vice President -- Managed Care Relations in March
1998. From 1996 until March 1998, Ms. Lehrer was the President and Chief
Executive Officer of Community Health Choice, Inc., an HMO in Houston, Texas,
and from 1993 until 1996 served in various capacities at Texas Children's
Hospital in Houston, Texas including President of the Texas Children's Health
Plan, Inc. and Director of Managed Care. From 1991 until 1993, she was an
Administrative Director at St. Joseph's Children's Hospital in Tampa, Florida.
Ms. Lehrer received her B.S. in Nursing from the University of South Carolina in
1979 and her M.B.A. from the University of Tampa in 1987.

CECIL R. PICKENS has been the Company's Vice President and Chief Accounting
Officer since October 1997. From November 1995 to February 1997, Mr. Pickens
served as the Corporate Controller for American Ophthalmic, Inc., a physician
practice management company specializing in ophthalmology. Mr. Pickens'
responsibilities at American Ophthalmic included internal and external financial
reporting, budgeting and analysis, and the establishment of accounting policies
and procedures. Prior to American Ophthalmic, from May 1992 to October 1995, Mr.
Pickens was with OccuSystems, Inc., a physician practice management company,
specializing in occupational medicine, where he held the positions of Director
of Managed Care Information and Corporate Controller. From July 1986 to February
1992, Mr. Pickens was employed by KPMG Peat Marwick in various accounting
capacities resulting in his becoming an Audit Manager in 1991. Mr. Pickens
graduated from the University of Texas at Austin with a B.B.A. in accounting in
May 1986 and is a Certified Public Accountant.

JOHN S. BACE, CFA, has agreed to serve as a Director of the Company upon
consummation of the Offering. Mr. Bace has been a private investor since October
1994 and currently serves in the capacity of Chairman or Trustee of several
charitable trusts and foundations. From 1976 until October 1994, Mr. Bace served
in various capacities including Senior Vice President, Executive Vice President,
Principal, and Director of Eagle Management and Trust Company, an investment
management firm with assets in excess of $1 billion. Mr. Bace received his
Masters of Business Administration in 1959 from the University of Texas where he
has for the last three years served as Investment Counselor to the MBA
Investment Fund, University of Texas in Austin. Mr. Bace has been a member of
the Association of Investment Management and Research since 1970, and since 1974
has been a member of the Institute of Chartered Financial Analysts.

S.F. "CHARLEY" HARTLEY, D.P.M., F.A.C.F.S. has agreed to become a
Director of the Company upon consummation of the Offering and has been a
practicing podiatrist in S.F. Hartley, D.P.M., P.C. since 1979. Dr. Hartley has
been a member of the Harris County Podiatry Association since 1979, having
served as its President in 1983-1984, has been a member of the Texas Podiatric
Medical Association since 1979, having served as its President in 1992-1993, has
been a member of the American Podiatry Medical Association since 1979, has
served as a Delegate of the American Podiatry Medical Association House of
Delegates since 1993 and, since 1987, has been a member of the Academy of
Podiatric Sports Medicine. Dr. Hartley

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<PAGE>
graduated from the University of Houston with a B.S. in Biology and from the
Illinois College of Podiatric Medicine with a Doctor of Podiatric Medicine. Dr.
Hartley is Board Certified by the American Board of Podiatric Surgery.

DONALD S. HUGE, M.D. has agreed to serve on the Board of Directors of AMP
upon consummation of the Offering. Dr. Huge has served as the National Medical
Director and Vice President of Chapman Schewe, Inc., a benefit consulting firm
since March 1997. From July 1995 to February 1997, he served as the Medical
Director for HMO Texas, where he was responsible for medical management,
utilization, concurrent review and case management, quality assurance and
quality improvement. Dr. Huge served as Senior Medical Director for Sanus/NYL
Care from June 1993 to June 1995, and from March 1992 to May 1995 he worked with
MetLife/United where he served as both Network Director and Medical Director.
Prior to assuming his various medical directorship positions, Dr. Huge was a
practicing physician for 23 years. Dr. Huge has been a member of the American
College of Medical Quality since 1992 and served as its President from 1994 to
1996. Dr. Huge has served on the Board of Trustees of Park Plaza Hospital, and
the Visiting Nurses Association, and has served on the utilization committees of
Park Plaza Hospital, Hermann Hospital and Diagnostic Center Hospital. Dr. Huge
received his B.A. degree in 1953 from Southern Methodist University, Dallas,
Texas, and his Medical Degree from Baylor College of Medicine, Houston, Texas,
in 1957.

STANLEY R. KALISH, D.P.M., F.A.C.F.S. has agreed to become a Director of
the Company and the Chairman of the Medical Policy Board upon consummation of
the Offering. Dr. Kalish has been a practicing podiatrist in Atlanta Foot & Leg
Clinic, P.A. since 1974, is an accomplished author and lecturer and has designed
several surgical instruments. Dr. Kalish has been an active member and Diplomat
of the American Board of Podiatric Surgery since 1976, has been a Fellow of the
American College of Foot Surgery (F.A.C.F.S.) since 1976, has been a member of
the American College of Podiatrics and since 1980 has been a Fellow of the
American College of Podiatric Dermatology. Dr. Kalish graduated in 1967 with a
B.A. in Biology from Adelphi University and received his Doctor of Podiatric
Medicine in 1971 from the New York College of Podiatric Medicine.

MEDICAL POLICY BOARD

Concurrently with the Offering, the Company will create a Medical Policy
Board to identify and communicate the best medical practices and protocol. The
initial Medical Policy Board will consist of the following four members:

NAME AGE POSITION
- ---------------------------------------- --- ---------------
Stanley R. Kalish, D.P.M., F.A.C.F.S.... 51 Chairman
Lawrence B. Harkless, D.P.M............. 47 Vice Chairman
Bernard J. Hersh, D.P.M................. 62 Vice Chairman
Robert G. Frykberg, D.P.M., M.P.H....... 46 Vice Chairman

STANLEY R. KALISH, D.P.M., F.A.C.F.S. See "Management -- Directors and
Executive Officers."

LAWRENCE B. HARKLESS, D.P.M. will serve as a Vice Chairman on the Medical
Policy Board upon consummation of the Offering. Since September 1993, Dr.
Harkless has been a Professor in the Department of Orthopedics and a Director of
the Podiatry Residency Training Program (the "UT Program") at the University
of Texas Health Science Center at San Antonio. From September 1987 until
September 1993 he was a Clinical Professor and Director of the UT Program. Dr.
Harkless received his B.S. from California College of Podiatric Medicine in San
Francisco, California in 1973 and his D.P.M. from the same institution in 1975.

BERNARD J. HERSH, D.P.M. has agreed to serve as a Vice Chairman of the
Medical Policy Board upon consummation of the Offering. Dr. Hersh was National
President of the American Association of Hospital Podiatrists and has been
involved in the American Academy of Podiatric Sports Medicine and the Texas
Podiatric Medical Association, among other professional associations. Since
1959, Dr. Hersh has been in

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private practice in Bernard J. Hersh, D.P.M., a sole proprietorship. Dr. Hersh
received his D.P.M. in 1959 from Temple University College of Podiatric
Medicine.

ROBERT G. FRYKBERG, D.P.M., M.P.H. will serve as a Vice Chairman of the
Medical Policy Board upon consummation of the Offering. Since 1978, Dr. Frykberg
has been in private practice at Boston Foot Care Group. Since 1996, he has been
a Clinical Instructor in Surgery at Harvard Medical School. Dr. Frykberg
received his B.S. in Zoology from the University of Rhode Island in 1973, his
D.P.M. from the California College of Podiatric Medicine in 1976, and his M.P.H.
from Harvard University in 1994.

BOARD OF DIRECTORS, MEDICAL POLICY BOARD AND COMMITTEES

DIRECTOR COMPENSATION

Following the closing of the Offering, it is anticipated that non-employee
directors of the Company will receive a fee of $2,000 for each meeting of the
Board attended in person and $500 for each Board meeting attended
telephonically. For each committee meeting not held in conjunction with a Board
meeting, each non-employee director will receive a fee of $1,000 for each such
meeting attended in person. All directors will be reimbursed for expenses
incurred in the performance of their duties. Each non-employee director will
receive a non-qualified option to purchase 5,000 shares of Common Stock
exercisable at the Offering price, upon being elected a director.

MEDICAL POLICY BOARD

Following the closing of the Offering, it is anticipated that those serving
in the capacity of Chairman or Vice Chairman of the Medical Policy Board will
receive a fee of $2,000 for each Medical Policy Board meeting attended in person
and $500 for each Medical Policy Board meeting attended telephonically. All
members of the Medical Policy Board will be reimbursed for expenses incurred in
the performance of their duties. Each member of the Medical Policy Board will
receive a non-qualified option to purchase 4,000 shares of Common Stock
exercisable at the Offering price, upon joining the Medical Policy Board.

EXECUTIVE COMMITTEE

Under the Company's Articles and Bylaws, the Board may by resolution
appoint from its membership, annually, an executive committee of two or more
directors, which shall include the Chief Executive Officer and the Chief
Financial Officer of the Company. The Board may designate in such resolution one
or more directors as alternate members of the Executive Committee, who may
replace any absent or disqualified member at any meeting of the committee. The
Executive Committee, during the intervals between meetings of the Board, will
have authority and power to act on behalf of the Board as provided in the
Bylaws. After the Offering, the initial members of the Executive Committee are
expected to be Messrs. McCrary and Bertsch.

OTHER COMMITTEES

The Board may, by resolution adopted by a majority of the authorized number
of directors, designate one or more other committees, each consisting of two or
more directors, to serve at the pleasure of the Board. The Board may designate
one or more directors as alternate members of any committee, who may replace any
absent member at any meeting of the committee. Any such committee shall have
authority to act in the manner and to the extent provided in the resolution of
the Board and may have all the authority of the Board, except with respect to
the limitations as set forth in the Bylaws.

Following the Closing, the Board is expected to have the following
committees, in addition to the Executive Committee, and the following respective
initial members (i) the Audit Committee (Mr. Bace and Dr. Huge), (ii) the
Finance and Strategic Planning Committee (Messrs. McCrary, Bertsch and one
independent director, and (iii) the Compensation Committee (Mr. McCrary, Mr.
Bace and Dr. Huge).

EXECUTIVE COMPENSATION

AMP has not conducted and will not conduct on-going non-developmental
business activities until the initial Affiliated Practice affiliations and the
Offering are complete. Until the Offering, AFC has paid the

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salaries of persons who are executive officers and employees of AMP. Prior to
the Offering, Jack N. McCrary, Chairman, Chief Executive Officer and President
of AMP, accrued salary of $150,000 for each of the fiscal years ended December
31, 1996 and 1997. In addition, Wayne A. Bertsch, Senior Vice President, Chief
Financial Officer, Treasurer and Director and Randy E. Johnson, Senior Vice
President-Regional Operation Officer were each paid salaries of $120,000 for the
fiscal year ended December 31, 1997. These salaries were incurred by AFC in
connection with the affiliations and will be assumed by AMP under the
Reimbursement and Assumption Agreement. Mr. McCrary's accrued salary for 1996
and 1997 will be paid with a portion of the proceeds of the Offering and, in
addition, Mr. McCrary has received 52,500 membership interests of AFC. Other
than Mr. McCrary, Mr. Bertsch and Mr. Johnson there have been no executive
officers who have earned $100,000 in any single completed fiscal year since the
Company's inception.

The Company has entered into employment agreements with Mr. McCrary, Wayne
A. Bertsch, Randy E. Johnson, Roger Bigham and David LaGuardia pursuant to which
these officers will be paid annual salaries of $300,000, $180,000, $180,000,
$150,000 and $150,000, respectively.

INCENTIVE AND NON-QUALIFIED STOCK OPTION PLAN

The Company has adopted the 1997 Incentive and Non-Qualified Stock Option
Plan (the "1997 Plan") to provide incentives to attract and retain directors,
officers, advisors, consultants and key employees. After the Offering, the 1997
Plan will be administered by the Company's Board of Directors or a committee
composed of members of the board (the "Plan Administrator"). Officers,
directors, employees of the Company, consultants and advisors to the Company are
eligible to receive awards under the 1997 Plan, at the Plan Administrator's
discretion.

Awards available under the 1997 Plan include: (i) Common Stock purchase
options; (ii) stock appreciation rights; (iii) restricted stock; (iv) deferred
stock; (v) performance shares and (vi) other stock-based awards. The Company has
reserved 1,157,098 of the shares of its Common Stock for granting of awards
under the 1997 Plan. Under the terms of the 1997 Plan, the Plan Administrator
retains discretion, subject to plan limits, to modify the terms of outstanding
awards and to reprice awards.

The Company has granted 464,500 options to purchase shares of Common Stock
upon consummation of the Offering at a purchase price equal to the initial
public offering price. Pursuant to their Employment Agreements (as defined
below), the Company has granted options to Messrs. McCrary, Bertsch, Johnson,
Bigham and LaGuardia under the 1997 Plan, representing the right to purchase
125,000, 65,000, 65,000, 15,000 and 15,000 shares of Common Stock, respectively.

PERFORMANCE BONUS PLAN

The Board has adopted the American Medical Providers, Inc. Executive
Officer Performance Bonus Plan (the "Performance Bonus Plan") covering
eligible officers of the Company. The Performance Bonus Plan will be
administered by the Compensation Committee, which each year, beginning on
January 1, 1998 will select the officers of the Company who will be eligible to
receive awards under the Performance Bonus Plan. Upon achievement by the Company
of certain targeted operating results or other performance goals, such as
operating income, pre-tax income or earnings per share, the Company will pay
performance bonuses, the aggregate amounts of which will be determined annually
based upon an objective formula. The Employment Agreements (as defined below)
provide for the payment of certain minimum bonuses upon the achievement of
targeted performance criteria under the Performance Bonus Plan. See
" -- Employment Agreements."

50
<PAGE>
EMPLOYMENT AGREEMENTS

In connection with the Offering, Messrs. McCrary, Bertsch, Johnson, Bigham
and LaGuardia's employment agreements with AFC will be terminated and replaced
with new employment agreements (the "Employment Agreements") with the Company
described below.

These officers' Employment Agreements provide that they will serve in the
following capacities: Mr. McCrary as President, Chief Executive Officer,
Chairman of the Board and Chairman of the Executive Committee; Mr. Bertsch as
Senior Vice President, Chief Financial Officer and a Director and, for as long
as he is a Director, a member of the Executive Committee; Mr. Johnson as Sr.
Vice President -- Regional Operations Officer; Mr. Bigham as Vice President of
the Company and Chief Operating Officer of AnestheCare, Inc.; and Mr. LaGuardia
as Vice President -- Ancillary Support Services.

The Employment Agreement of Mr. McCrary will have an initial term of five
years, and each of the Employment Agreements of Messrs. Bertsch, Johnson, Bigham
and LaGuardia will have an initial term of three years. The Employment Agreement
of Mr. McCrary will be renewed automatically upon expiration of its initial term
and any subsequent five year term, unless the Company or Mr. McCrary gives 12
months prior notice that such Agreement will not be renewed. Upon expiration of
their initial terms, each of the Employment Agreements of Messrs. Bertsch,
Johnson, Bigham and LaGuardia will be renewed automatically one time only for
two additional years, unless the Company or any of Messrs. Bertsch, Johnson,
Bigham and LaGuardia as applicable, gives 12 months prior notice that such
Agreement will not be renewed.

Under the Employment Agreements, each officer will be entitled to receive a
base salary and an annual bonus to be determined by the AMP Board of Directors
and will be entitled to participate in the stock option plans of the Company
that are generally available to executives of the Company. The initial base
salaries for Messrs. McCrary, Bertsch, Johnson, Bigham and LaGuardia under their
respective Employment Agreements are $300,000, $180,000, $180,000, $150,000 and
$150,000, respectively. The total number of shares of Common Stock of the
Company that will be permitted to be distributed under the 1997 Plan will be
1,157,098 shares. Of this total, pursuant to the Employment Agreements, the
Company has granted to Messrs. McCrary, Bertsch, Johnson, Bigham and LaGuardia
options under the 1997 Plan to purchase 125,000, 65,000, 65,000, 15,000 and
15,000 shares of Common Stock, respectively.

Each of Messrs. McCrary, Bertsch, Johnson, Bigham and LaGuardia is
prohibited from competing with the Company while employed by the Company. In
certain circumstances, each of Messrs. McCrary, Bertsch, Johnson, Bigham and
LaGuardia will be prohibited from competing for two years following termination
of his Employment Agreement during the initial term of his Employment Agreement
and for one year following termination during successive terms.

The Employment Agreement of Mr. McCrary cannot be terminated by the Company
without the prior approval of two-thirds of the Board. If Mr. McCrary is
terminated by the Company without "Cause" or resigns for "Good Reason" (each
as defined in his Employment Agreement), his outstanding options will
immediately vest and become exercisable and he will be entitled to receive a
lump sum payment equal to the greater of (i) his current base salary and annual
target bonus payable over the remainder of his contract term or (ii) 3.0 times
his current annual salary plus annual target bonus. If Messrs. Bertsch, Johnson,
Bigham or LaGuardia is terminated by the Company without "Cause" or by such
officer for "Good Reason" (each as defined in their respective Employment
Agreement), his respective outstanding options will immediately vest and become
exercisable and he will be entitled to receive a lump sum payment equal to the
greater of (i) his current base salary and annual target bonus payable over the
remainder of his contract term or (ii) two times his current annual salary plus
annual target bonus.

Upon termination of the employment of any of Messrs. McCrary, Bertsch,
Johnson, Bigham or LaGuardia by the Company without "Cause" or by such officer
for "Good Reason," such officer would be entitled to receive a lump sum
payment equal to the total amount of any excise taxes to which such officer may
become subject under Section 4999 of the Internal Revenue Code.

51
<PAGE>
CERTAIN TRANSACTIONS

AFFILIATED PRACTICES

The consideration paid by the Company for the initial Affiliated Practices
is based upon the practices' gross revenue, growth potential, quality of
patients, location and service delivery and depth of presence in its local
market. All of the Transfers of the initial Affiliated Practices, except for the
Kramer Transfer and the Ambulatory Surgery Center Acquisitions, will be
accounted for by the Company under SAB 48, such that the non-monetary assets and
liabilities of these initial Affiliated Practices will be received by the
Company at the transferor's historical cost basis for accounting purposes. The
Company's management coordinated the valuation of these Affiliated Practices.
The methodology for valuing the non-monetary assets was primarily based upon a
multiple of the projected earning's contribution to AMP utilizing adjusted
historical financial information of the respective Affiliated Practices. Once
the total consideration was determined, the Affiliated Practices could elect to
receive a maximum of 25% in cash and the balance in shares of Common Stock
valued at the initial public offering price. The balance of net assets acquired
or net liabilities assumed did not weigh significantly in the allocation.
Appraisals of the practices were not obtained and if received would have no
impact on the non-monetary transfers. Monetary assets and liabilities, including
billed and unbilled receivables and credit balances, payables and certain
miscellaneous accruals will either be acquired by AMP at their fair market value
or retained by the Affiliated Practices, as agreed among the parties.

The AnestheCare Acquisition, the Kramer Transfer, the Ambulatory Surgery
Center Acquisitions, and all future practice affiliations will not be accounted
for under SAB 48. Instead these practice affiliations will be accounted for as
purchases at fair market value and are expected to result in purchase prices in
excess of net assets acquired (goodwill). Each owner DPM of the Affiliated
Practices and AnestheCare is considered a "promoter" of the Company. The
following table provides certain information concerning the Transfers:

<TABLE>
<CAPTION>
CONSIDERATION TO BE RECEIVED
-----------------------------------------------------
ASSETS TO BE CASH VALUE NUMBER OF DEBT
SAB 48 TRANSACTIONS(1) CONTRIBUTED(2) OF SHARES SHARES(3) CASH PAID(4) ASSUMED(4)
- ------------------------------------- -------------- ---------- --------- ------------ ----------
<S> <C> <C> <C> <C> <C>
Louis M. Antahades, D.P.M............ $ 6,000 $ 41,324 3,757 $ 10,331 $ --
Stephan Bard, D.P.M.................. 28,218 122,919 11,174 53,572 --
Douglas M. Beek, D.P.M............... 21,600 299,735 27,249 141,716 --
David L. Blumfield, D.P.M.(5)........ 128,119 523,493 47,591 260,847 --
William B. Bradbury, D.P.M.(5)....... 62,318 122,645 11,150 82,539 --
Karen E. Brooks, D.P.M............... 119,469 336,862 30,624 154,140 --
David K. Cantor, D.P.M............... 91,345 375,946 34,177 173,981 --
Armida deBelvill, D.P.M.............. -- 80,652 7,332 20,163 --
Peter R. DeFrank, D.P.M.............. 17,108 206,115 18,738 93,200 --
Salvatore DeFrank, D.P.M............. 21,063 405,786 36,890 165,882 --
Kenrick J. Dennis, D.P.M............. 207,259 217,978 19,816 108,444 --
Stephen R. Densen, D.P.M............. 51,197 161,800 14,709 81,252 --
Laurence I. Dorman, D.P.M............ 6,323 145,102 13,191 72,277 --
Alan I. Ettinger, D.P.M.............. 24,554 172,956 15,723 77,174 --
Gerald I. Falke, D.P.M............... 177,929 724,420 65,856 306,806 --
Thomas S. Garrison, D.P.M............ 66,873 413,185 37,562 185,588 --
Norman W. Goldman, D.P.M............. 63,060 328,354 29,850 151,636 --
Anthony Halinski, D.P.M.............. 323,870 982,655 89,332 395,183 --
Todd Harrison, D.P.M................. 117,646 482,946 43,904 204,537 --
S.F. Hartley, D.P.M.................. 65,263 675,226 61,384 311,343 --
Dale S. Herman, D.P.M................ 227,228 309,197 28,109 150,429 --
Bernard J. Hersh, D.P.M.............. 225,605 501,275 45,570 224,125 --
Richard Hochman, D.P.M............... 22,717 98,095 8,918 52,906 --
Stanley R. Kalish, D.P.M.(6)......... 252,735 685,261 62,296 378,888 --
Michael W. Kendall, D.P.M............ 193,804 551,148 50,104 351,094 --
Kirk Koepsel, D.P.M.................. 66,872 413,185 37,562 185,588 --
Paul D. Leon, D.P.M.................. 21,465 250,558 22,778 106,806 --
Gregory L. Mangum, D.P.M.(5)......... 71,384 290,725 26,430 158,195 --
</TABLE>
(TABLE CONTINUED ON FOLLOWING PAGE)

52
<PAGE>

<TABLE>
<CAPTION>
CONSIDERATION TO BE RECEIVED
-----------------------------------------------------
ASSETS TO BE CASH VALUE NUMBER OF DEBT
SAB 48 TRANSACTIONS(1) CONTRIBUTED(2) OF SHARES SHARES(3) CASH PAID(4) ASSUMED(4)
- ------------------------------------- -------------- ---------- --------- ------------ ----------
<S> <C> <C> <C> <C>
Bruce Miller, D.P.M.(5).............. 102,433 432,301 39,300 200,162 --
James E. Miller, D.P.M............... 74,770 93,260 8,478 53,940 --
Michael Mineo, D.P.M.(5)............. 128,119 523,493 47,591 260,847 --
Robert J. Morris, D.P.M.............. 63,447 121,539 11,049 120,385 --
Steven A. Moskowitz, D.P.M.(5)....... 127,402 484,944 44,086 234,417 --
Jeffrey R. Murray, D.P.M............. 28,566 519,187 47,199 267,882 --
Sherman Nagler, D.P.M.(5)............ 91,237 325,276 29,571 163,707 --
Robert G. Parker, D.P.M.(5).......... 181,471 324,522 29,502 169,290 56,000
Steven P. Richman, D.P.M............. 97,454 481,189 43,744 219,001 --
Donald E. Robinson, D.P.M............ 75,207 275,064 25,006 143,108 --
Mark R. Sands, D.P.M................. 163,897 822,300 74,755 367,588 --
Charles P. Sanicola, D.P.M........... 45,066 278,863 25,351 136,204 --
Jerry S. Silverman, D.P.M............ 180,865 394,267 35,842 106,422 100,000
Donald C. Stran, D.P.M............... 108,420 760,575 69,143 330,922 --
Barry M. Tuvel, D.P.M................ 62,037 471,119 42,829 211,706 --
George R. Vito, D.P.M................ 268,885 1,734,362 157,669 1,278,121 --
Richard A. Weissman, D.P.M........... 21,600 299,735 27,249 141,716 --
-------------- ---------- --------- ------------ ----------
Subtotal......................... $4,501,900 $18,261,539 1,660,140 $9,064,060 $156,000
-------------- ---------- --------- ------------ ----------

NON SAB 48 TRANSACTIONS
- -------------------------------------
Jerald N. Kramer, D.P.M.(7).......... $ 63,365 $ -- -- $1,404,000 $ --
Bellaire Surgicare, Inc.(5).......... 724,980 3,840,000 349,091 960,000 500,000
Clayton Outpatient Surgical Center,
Inc.(6)............................ 227,000 260,000 23,636 65,000 --
-------------- ---------- --------- ------------ ----------
Subtotal......................... $1,015,345 $4,100,000 372,727 $2,429,000 $500,000
-------------- ---------- --------- ------------ ----------
Total............................ $5,517,245 $22,361,539 2,032,867 $11,493,060 $656,000
============== ========== ========= ============ ==========
</TABLE>

- ------------

(1) The DPMs who own the initial Affiliated Practices are considered
"promoters" for purposes of Rule 405 promulgated under the Securities Act
of 1933, as amended.

(2) Assets to be contributed include approximately $4.4 million of current
assets and $1.1 million of property and equipment.

(3) Assumes the midpoint of the range for the initial public offering price.

(4) Cash Paid includes consideration attributable to $4.3 million of monetary
assets acquired in the SAB 48 Transactions. Under SAB 48, the cash portion
of the purchase price attributable to the non-monetary assets of $4.7
million will be treated as a cash dividend to the DPM owners of the
Affiliated Practices.

(5) As part of the transfers of the assets of certain promoters, AMP will
acquire a 100% interest in Bellaire Surgicare, Inc., a free-standing
ambulatory center. This component of the transfers does not qualify for the
accounting treatment pursuant to SAB 48 and accordingly will be recorded as
a purchase pursuant to the requirements of APB16.

(6) Clayton Outpatient Surgical Center, Inc. is an ambulatory surgery center
being acquired as part of the transfers of Stanley R. Kalish, D.P.M. This
component of the transfers does not qualify for the accounting treatment
pursuant to SAB 48 and accordingly will be recorded as a purchase pursuant
to the requirements of APB 16.

(7) Although Dr. Kramer is considered a "promoter" under Rule 405 for purposes
of complying with certain SEC disclosure requirements, he is not considered
a "promoter" for purposes of SAB 48 and the Company's affiliation with Dr.
Kramer's practice will not be accounted for under SAB 48.

DISTRIBUTION OF CLASS B COMMON STOCK TO PROMOTERS PARTICIPATING IN AFC
FINANCINGS

Certain promoters of the Company have participated in financings of Ankle &
Foot Centers of America, LLC ("AFC") and own membership interests of AFC
directly or indirectly which were purchased in connection with such financings.
In addition, certain promoter members of management were issued membership
interests in AFC as founders of AFC or in consideration of contributions to AFC
as members of AFC's management. AFC issued membership interests to each of these
individuals in connection with AFC's ongoing efforts to fund the organization
and development of AMP.

53
<PAGE>

Shares of AMP Class B Common Stock were issued to AFC as part of AFC's
formation efforts on behalf of AMP. Approximately 180 days after the
consummation of the Offering, AFC expects to distribute these shares of Class B
Common Stock to its members. The number of shares distributable to each member
will be based upon the number of membership interests such member holds. Such
AFC investors invested in AFC in order to ultimately obtain an ownership
interest in AMP. Upon consummation of the Offering, there will be no business
purpose to AFC continuing to hold shares of AMP and so such shares will be
distributed to members of AFC. The following lists the approximate number of
shares distributable to these promoters:

DISTRIBUTABLE SHARES
OF VALUE OF
PROMOTERS CLASS B COMMON STOCK CLASS B COMMON STOCK
- ------------------------- --------------------- -----------------------
Jack N. McCrary.......... 45,354 $ 498,894
John S. Bace (1)......... 11,964 131,604
Wayne A. Bertsch......... 2,991 32,901
S. F. Hartley, D.P.M..... 15,443 169,873
Randy Johnson............ 598 6,578
Stanley R. Kalish,
D.P.M.................... 21,426 235,686
David LaGuardia.......... 29,909 328,999
Sherman Nagler, D.P.M.... 5,982 65,802
Robert G. Parker,
D.P.M.................... 11,964 131,604
Steven P. Richman,
D.P.M.................... 5,982 65,802
Jerry S. Silverman,
D.P.M.................... 5,982 65,802
Texas Podiatry
Group-Houston (2)........ 11,964 131,604
George R. Vito, D.P.M.... 5,982 65,802
Bellaire Surgicare, IPA
(3)...................... 11,964 131,604
Bay Area Podiatry (4).... 8,973 98,703
Thomas S. Garrison,
D.P.M.................... 2,991 32,901

- ------------
(1) Membership interests were originally issued to J.M. Partners, Ltd., an
affiliate of John S. Bace. Subsequently, J.M. Partners, Ltd. transferred
its membership interests to Mr. Bace and trusts controlled by Mr. Bace.

(2) Drs. Dennis, Garrison, Hartley, Koepsel and Parker are among the principals
of Texas Podiatry Group-Houston and are owner DPMs involved in the
Transfers.

(3) Drs. Blumfield, Bradbury, Mangun, Bruce Miller, Mineo, Moskowitz and Parker
are among the principals of Bellaire Surgicare, IPA and are owner DPMs
involved in the Transfers.

(4) Drs. Garrison and Koepsel are among the principals of Bay Area Podiatry
Association and are owner DPMs involved in the Transfers.

SEED CAPITAL FINANCING TRANSACTION WITH PROMOTERS

Of the promoters discussed above under the caption "-- Distribution of
Class B Common Stock to Promoters Participating in AFC Financings," certain of
such promoter owner DPMs from whom the Company is acquiring assets or stock in
connection with the Transfers and certain members of management own membership
interests of AFC directly or indirectly purchased in connection with an early
seed capital financing transaction (the "Seed Capital Financing"). As
described above, about the time of the consummation of the Offering, AFC will
distribute shares of Class B Common Stock it currently holds to its members,
including such promoters.

After giving effect to the consummation of the Stock Split, the maximum
number of shares of Class B Common Stock distributable to these promoters, in
connection with the Seed Capital Financing, totaled 171,084 shares. In
connection with the Seed Capital Financing, such promoters were given the option
of exchanging one-seventh of such shares of Class B Common Stock distributable
to them for one-half of the

54
<PAGE>
amount loaned to AFC by such promoter. The following lists the approximate
number of shares distributable to each of the promoters or their related
entities, in connection with the Seed Capital Financing, and the amount each
promoter or entity loaned to AFC:

DISTRIBUTABLE SHARES
OF
CLASS B COMMON STOCK
PURSUANT TO
SEED CAPITAL LOAN
PROMOTER OR ENTITY FINANCING AMOUNT
- ------------------------------------- --------------------- --------
Jack N. McCrary...................... 35,892 (1)
John S. Bace (2)..................... 11,964 $ 95,000
David LaGuardia...................... 29,909 237,500
Randy Johnson........................ 598 4,750
Wayne A. Bertsch..................... 2,991 23,750
Stanley R. Kalish, D.P.M............. 11,964 95,000
S. F. Hartley, D.P.M................. 5,982 47,500
Sherman Nagler, D.P.M................ 5,982 47,500
Robert G. Parker, D.P.M.............. 11,964 95,000
Steven P. Richman, D.P.M............. 5,982 47,500
Jerry S. Silverman, D.P.M............ 5,982 47,500
Texas Podiatry Group-Houston (3)..... 11,964 95,000
George R. Vito, D.P.M................ 5,982 47,500
Bellaire Surgicare, IPA (4).......... 11,964 95,000
Bay Area Podiatry (5)................ 8,973 71,250
Thomas S. Garrison, D.P.M............ 2,991 23,750

- ------------

(1) Mr. McCrary's membership interest in AFC was issued to him in exchange for
his agreement to defer compensation of $300,000 until successful completion
of the Offering. See "-- Deferred Salary Payment for Promoter Officer."

(2) Membership interests were originally issued to J. M. Partners, Ltd., an
affiliate of John S. Bace. Subsequently, J. M. Partners, Ltd. transferred
its membership interests to Mr. Bace and trusts controlled by Mr. Bace.

(3) Drs. Dennis, Garrison, Hartley, Koepsel and Parker are among the principals
of Texas Podiatry Group-Houston and are owner DPMs involved in the
Transfers.

(4) Drs. Blumfield, Bradbury, Mangum, Miller, Mineo, Moskowitz and Parker are
among the principals of Bellaire Surgicare, IPA and are owner DPMs involved
in the Transfers.

(5) Drs. Garrison and Koepsel are among the principals of Bay Area Podiatry
Association and are owner DPMs involved in the Transfers.

PROMOTER PARTICIPATION IN BRIDGE FINANCING AND UNITS RESCISSION OFFER

During the first quarter of 1998, AFC completed a financing consisting of
15 1/2 units in AFC (the "AFC Units") for $1,550,000, representing $1,472,500
in non-interest bearing loans and $77,500 representing 25,840 membership
interests in AFC to fund certain expenses on behalf of AMP, in connection with
the Offering (the "Bridge Financing"). The Bridge Financing provided for the
loans to be repaid by AFC from funds it will receive from the Offering.
Additionally, AFC is required to repurchase each of the 15 1/2 units in AFC for
$71,667 in cash. In connection with the Offering, each investor was to be given
the opportunity to purchase $71,667 worth of Common Stock offered in the
Offering valued at the initial public offering price. Upon the closing of the
Offering, AMP will assume this obligation of AFC in satisfaction of amounts due
to AFC. The Company and AFC has offered to rescind the investment of the
investors in the Bridge Financing and the opportunity to purchase Common Stock
at the initial offering price. Whether the Units Rescission Offer is accepted or
rejected, Bridge Investors will not retain the right to have any Common Stock
set aside to purchase at the initial public offering price. See "Description of
Capital Stock -- Units Rescission Offer."

Certain members of management, directors and other promoters have
participated in this financing by loaning funds to AFC and making such equity
investments. The following lists the promoter who made such

55
<PAGE>

investment in AFC, the equity investment made, the amount of the loan to be
repaid, and the additional amount of cash (or cash value of the shares of Common
Stock) to be received by such persons upon the repurchase by AFC of the AFC
membership units:

EQUITY LOAN EQUITY
PROMOTER INVESTMENT AMOUNT REDEMPTION
- ------------------------------------- ----------- ------- -----------
Jack N. McCrary...................... $ 5,000 $95,000 $71,667
Wayne A. Bertsch(1).................. 5,000 95,000 71,667
John S. Bace, CFA.................... 5,000 95,000 71,667
George Vito.......................... 5,000 95,000 71,667

- ------------

(1) Of this investment, 20% was invested by Mr. Bertsch directly and the
remaining 80% was invested by persons or entities related to Mr. Bertsch,
with respect to which Mr. Bertsch expressly disclaims any beneficial
ownership.

MANAGEMENT'S SHORT-TERM LOAN TO AFC

In order to complete the funding of the Company's development and
organization expenses through the closing of the Offering, Jack N. McCrary, the
Company's Chairman, President and Chief Executive Officer and a promoter, made a
short-term loan to AFC in the aggregate principal amount of $110,000. AFC will
repay the principal amount of this loan, and interest in the amount of $73,334,
to Mr. McCrary with the portion of the funds from the Company's Offering
reimbursed to AFC for expenses, debt and interest incurred by AFC on behalf of
the Company.

REIMBURSEMENT OF AFC EXPENSES BY THE COMPANY

Pursuant to the Reimbursement and Assumption Agreement between AFC and the
Company, the Company has agreed to reimburse AFC approximately $6.0 million
(including any amounts payable pursuant to the Units Rescission Offer) for
expenses, debt and interest incurred by AFC relating to AMP's organizational and
development costs and working capital in connection with the Transfers and the
Offering. AFC owns, prior to the Offering, 56.3% of the outstanding voting
securities of the Company. AFC will provide AMP with assets upon consummation of
the Offering including the assets necessary for certain of AMP's operations
after the completion of the Transactions and primarily including computer
equipment, furniture and office equipment. These assets will be acquired by AMP
with a portion of the proceeds of the Offering at AFC's historical cost basis of
approximately $542,000, which method was approved by the management of both AFC
and AMP.

In addition, AMP will reimburse AFC for the Company's organizational and
affiliation costs incurred by AFC on behalf of AMP. These costs include costs
associated with the Offering consisting principally of professional fees and
expenses which have been or will be paid to AFC's and the Company's attorneys
and independent public accountants, aggregating approximately $4.5 million, as
well as salaries of AFC employees and general office expenses. Those items paid
by AFC on behalf of AMP will be reimbursed with a portion of the proceeds of the
Offering at the cost originally incurred by AFC, which was the then fair market
value of the service provided or property leased. This method for determining
the amount to be reimbursed was approved by management of the Company and AFC.
See "Use of Proceeds."

ACQUISITION OF PRACTICES OF FUTURE MEMBERS OF BOARD AND OFFICERS

The Company is acquiring practices of certain promoters who will be members
of the Company's Board of Directors or executive officers of the Company upon
consummation of the Offering. The Company will acquire the assets and stock of
the practices of S.F. Hartley, D.P.M. and Stanley Kalish, D.P.M., each of whom
will become a member of the Company's Board of Directors upon consummation of
the Offering. Dr. Kalish is also the Chairman of the Company's Medical Policy
Board.

In addition, David LaGuardia and Roger Bigham, both of whom are executive
officers of AMP, each own 50% of AnestheCare. Pursuant to the AnestheCare
Acquisition, Messrs. LaGuardia and Bigham will each receive (i) $2.25 million in
cash and (ii) additional consideration of up to $750,000 in cash and $250,000
payable in shares of Common Stock (valued at the initial public offering price),
which will be

56
<PAGE>
held in escrow and may be paid to each pending AnestheCare's achievement of
certain performance targets over a three-year period beginning January 1, 1998,
in exchange for the assets of AnestheCare. The purchase price of AnestheCare was
determined by the Company's management based on a multiple of the operating
income of AnestheCare for the most recent twelve month period. The AnestheCare
Acquisition will not be accounted for under SAB No. 48. Instead, this
transaction will be accounted for as a purchase at fair market value, as agreed
among the parties.

CERTAIN LEASE ARRANGEMENTS WITH PROMOTER OFFICER

The Company currently occupies corporate offices consisting of 16,000
square feet of office space located at 3555 Timmons Lane, Houston, Texas. The
original lease for 7,544 square feet of such space between Mid-America
Hospitals, Inc., ("Mid-America") and M & J Wilkow, Ltd., as prime landlord
(subsequently assigned to Timmons Texas, Ltd. ("Landlord")), was originally
dated November 14, 1988, was amended by Amendment of Lease dated May 10, 1994,
and a Second Amendment of Lease dated February 22, 1995, (collectively the Prime
Lease, the Amendment of Lease and the Second Amendment of Lease being referred
to as the "Lease"). Pursuant to an Assignments of Lease entered into on
December 17, 1997 by and between Mid-America, as Assignor, Landlord AFC and the
Company as Assignees, Mid-America assigned its rights to lease such corporate
offices to AFC as of December 1, 1997 and AFC agreed to assign its rights to the
lease to the Company upon the closing of the Offering. Jack N. McCrary, the
Company's Chairman, President and Chief Executive Officer and a promoter of the
Company, founded and served as Vice Chairman and President of Mid-America. The
Lease currently expires March 31, 2000, and requires a monthly base rental of
$7,060.

DEFERRED SALARY PAYMENT FOR PROMOTER OFFICER

Mr. McCrary has served as the Director, President and Chief Executive
Officer of AFC and is a promoter of the Company. As such, he has managed and
supervised the organizational efforts of AFC. Mr. McCrary has agreed to accept
deferred compensation of $300,000 payable upon successful completion of the
Offering. In exchange for Mr. McCrary agreeing to defer his compensation earned
prior to the Offering, Mr. McCrary has received 52,500 membership interests of
AFC's outstanding and issued membership interests.

CONSULTING ARRANGEMENTS WITH CERTAIN PROMOTER DPMS

Drs. Garrison and Dennis, from whom the Company is acquiring assets in
connection with the Transfers, have entered into consulting arrangements with
AFC. Pursuant to his consulting agreement, Dr. Garrison will be paid
approximately $4,000 per month over the eighteen months following the IPO and
Dr. Dennis will be paid approximately $1,750 per month over the same period.
Both agreements are cancelable by either party with 60 days notice.

57
<PAGE>
PRINCIPAL STOCKHOLDERS

The following table sets forth certain information as of March 7, 1998
regarding the beneficial ownership of the Company's Common Stock and Class B
Common Stock and as adjusted to reflect the sale of the shares offered pursuant
to this Prospectus, by (i) each person known to the Company to own beneficially
more than 5% of the Company's Common Stock and Class B Common Stock, (ii) each
Named Executive Officer of the Company, (iii) each director of the Company, and
(iv) all directors, nominees and executive officers as a group.

<TABLE>
<CAPTION>
PERCENT
OF
PERCENT OF SHARES OF COMMON
CLASS B COMMON STOCK STOCK
SHARES OF COMMON STOCK BENEFICIALLY BENEFICIALLY
CLASS B BENEFICIALLY OWNED OWNED OWNED
COMMON STOCK ----------------------- ----------------------- --------
BENEFICIALLY PRIOR TO AFTER PRIOR TO AFTER PRIOR TO
NAME OF BENEFICIAL OWNER OWNED(1)(2) OFFERING(2) OFFERING OFFERING OFFERING(3) OFFERING
- ---------------------------------------- ------------ ----------- -------- -------- ----------- --------
<S> <C> <C> <C>
Ankle & Foot Centers of America,
LLC(4)................................ 365,625 56.3% 56.3 % -- -- --
John S. Bace, CFA(5).................... 11,960 1.8 1.8 -- -- --
Wayne A. Bertsch........................ 21,028 3.2 3.2 -- -- --
S. F. Hartley, D.P.M., F.A.C.F.S.(6).... 15,438 2.4 2.4 -- 61,384 --
Donald S. Huge, M.D.(7)................. -- * * -- -- --
Randy Johnson........................... 18,623 2.9 2.9 -- -- --
Stanley Kalish, D.P.M., F.A.C.F.S.(8)... 21,418 3.3 3.3 -- 85,932 --
Jack N. McCrary......................... 256,588 39.5 39.5 -- -- --
All Directors and Executive Officers as
a Group............................... 381,518 58.7 58.7 -- 147,316 --
</TABLE>
AFTER
NAME OF BENEFICIAL OWNER OFFERING(3)
- ---------------------------------------- -----------
Ankle & Foot Centers of America,
LLC(4)................................ --
John S. Bace, CFA(5).................... --
Wayne A. Bertsch........................ --
S. F. Hartley, D.P.M., F.A.C.F.S.(6).... 1.1%
Donald S. Huge, M.D.(7)................. --
Randy Johnson........................... --
Stanley Kalish, D.P.M., F.A.C.F.S.(8)... 1.5
Jack N. McCrary......................... --
All Directors and Executive Officers as
a Group............................... 2.5

- ------------

* Less than one percent.

(1) Unless otherwise indicated, each of the individual stockholders listed above
has, through the Offering date, granted all of his or her voting power with
respect to the shares of Common Stock or Class B Common Stock beneficially
owned by such stockholder to Jack N. McCrary. Shares of Common Stock subject
to options exercisable within 60 days, of which there are none, would be
deemed outstanding for purposes of computing the percentage of ownership of
the holder. The address of all persons listed except for Mr. Bace, and Drs.
Hartley, Huge and Kalish is 3555 Timmons Lane, Suite 1550, Houston, Texas
77027.

(2) The shares of Class B Common Stock listed as beneficially owned by each
stockholder assumes the distribution of AMP shares held by AFC to its
respective members in accordance with the member ownership percentages. The
following table lists the appropriate number of shares and percent of Class
B Common Stock of the Company distributable by AFC to the named Principal
Stockholders.

SHARES OF PERCENT OF
CLASS B CLASS B
COMMON STOCK COMMON STOCK
------------ ------------
John S. Bace, CFA.................... 11,960 1.8%
Wayne A. Bertsch..................... 2,990 0.5%
S.F. Hartley, D.P.M., F.A.C.F.S...... 15,438 2.4%
Donald S. Huge, M.D.................. -- --
Randy Johnson........................ 585 0.1%
Stanley Kalish, D.P.M., F.A.C.F.S.... 21,418 3.3%
Jack N. McCrary...................... 45,338 7.0%
All Directors and Executive Officers
as a Group......................... 127,693 19.6%

(3) Assumes the mid-point of the initial offering price range.

(4) Messrs. Bace, Bertsch, Johnson and McCrary and Drs. Hartley and Kalish are
investors in and owners of AFC and will be entitled to distribution of the
Company's Class B Common Stock held by AFC in proportion to their ownership
of membership interests. See footnote number 2 above.

(5) The business address of Mr. Bace is 3730 Del Monte, Houston, Texas 77019.

(6) The business address of Dr. Hartley is 112 W. Pasadena Blvd., Deer Park,
Texas 77536. Dr. Hartley is an owner DPM of one of the Affiliated Practices
and will, upon consummation of the transactions, receive Common Stock having
an equivalent value of $675,226 valued at the Offering price.

(7) Dr. Huge's business address is 1177 W. Loop South, Suite 700, Houston, Texas
77027.

(8) Dr. Kalish's business address is 6911 Tara Blvd., Jonesboro, GA 30236. Dr.
Kalish is an owner DPM of one of the Affiliated Practices and will receive
Common Stock having an equivalent value of $945,261 valued at the Offering
price.

58
<PAGE>
DESCRIPTION OF CAPITAL STOCK

The Company has authorized 20,000,000 shares of Class A Common Stock, $.001
par value per share ("Common Stock"), 1,000,000 shares of Class B Common
Stock, par value $.001 per share ("Class B Common Stock"), and 20,000,000
shares of preferred stock, $.001 par value per share. As of February 17, 1998,
no shares of Common Stock or Preferred Stock were issued and outstanding and
650,000 shares of Class B Common Stock were outstanding and held of record by
fourteen stockholders.

COMMON STOCK AND CLASS B COMMON STOCK

Upon consummation of the Offering, holders of the Class B Common Stock will
have the ability to elect as a class one member of the Board of Directors,
provided however, that if 65% or more of the Class B Common Stock outstanding on
the date of this Prospectus has been converted into Common Stock, the Class B
Common Stock shall no longer have the ability to elect a director as a class and
the holders of the Common Stock will have the ability to elect as a class all
other members of the Board of Directors. The Common Stock and Class B Common
Stock possess ordinary voting rights and vote together as a single class in
respect of all other corporate matters, and, in connection therewith, holders of
shares of Common Stock are entitled to one vote per share and holders of shares
of Class B Common Stock are entitled to 2/3 of a vote per share. The Common
Stock and Class B Common Stock afford no cumulative voting rights, and the
holders of a majority of the shares voting for the election of directors can
elect all the directors if they choose to do so. Except for the conversion
rights of the Class B Common Stock described below, the Common Stock and Class B
Common Stock carry no preemptive rights, are not convertible, redeemable,
assessable or entitled to the benefits of any sinking fund. The holders of
Common Stock and Class B Common Stock are entitled to dividends in such amounts
and at such times as may be declared by the Board of Directors out of funds
legally available therefor. The Company intends that, after completion of the
Offering, all future dividends, if any, declared on, or distributions with
respect to, its shares of Common Stock and Class B Common Stock will be paid on
a pro rata basis to the holders of such shares. See "Dividend Policy" for
information regarding the Company's dividend policy.

Directors may be removed, with or without cause, by the holders of the
class or classes of stock that elected them. Directors may be removed by the
Board of Directors only for cause. Vacancies in a directorship may be filled by
the vote of the class or classes of shares that had previously filled that
vacancy, or by the remaining directors or director elected by such class or
classes; however, if there are no such directors, the vacancy may be filled by
the other directors.

The Class B Common Stock is convertible into Common Stock, at the option of
the holder thereof, upon the occurrence of a Conversion Event (as defined
below). The maximum number of shares of Common Stock that may be issued upon
conversion of the Class B Common Stock is 1,950,000. The Class B Common Stock
converts into Class A Common Stock on a share-for-share basis, provided however,
that if the Common Stock reaches certain average closing prices for 15
consecutive trading days during the next six years on the Nasdaq National
Market, other over-the-counter market or an exchange, as then applicable (the
"Trading Market") then, as set forth below, the conversion ratio with respect
to a certain number of shares of Class B Common Stock will immediately change so
that such shares will thereafter be convertible into Common Stock at the ratio
of three shares of Common Stock for each share of Class B Common Stock (each
such share an "Adjusted Conversion Share").

On the date that the average closing price on the Trading Market for the
preceding 15 consecutive trading days (the "Average Price") exceeds 150% of
the price to the public in the Offering, 130,000 of the issued shares of Class B
Common Stock will immediately become Adjusted Conversion Shares (and subject to
the new 3-for-1 conversion ratio). Thereafter, the remaining 520,000 shares of
Class B Common Stock will become Adjusted Conversion Shares in four remaining
increments of 130,000 shares of Class B Common Stock each (20% of the total
number of shares of Class B Common Stock issued) upon the attainment of new
Average Prices. The Average Prices applicable to each new 20% increment will
equal 120% of each preceding Average Price applicable to the preceding 20%
increment. Therefore, the five Average Prices at which each of the five total
increments shall automatically become Adjusted Conversion Shares are $16.50,
$19.80, $23.76, $28.51 and $34.21. Upon a Conversion Event, each holder of Class
B

59
<PAGE>

Common Stock will have the right to have each share of Class B Common Stock
converted into that number of shares of Common Stock as each such share is
entitled to based upon the Average Prices achieved, if any. Any additional
Average Price attained after the occurrence of a Conversion Event will continue
to act to create Adjusted Conversion Shares, as applicable. If any shares of
Class B Common Stock are outstanding on the sixth anniversary of this
Prospectus, such shares will automatically convert into a number of shares of
Common Stock based upon the conversion ratio then applicable to such shares.
Thus, on such anniversary if a portion of the shares of Class B Common Stock
have become Adjusted Conversion Shares and a portion of the shares of Class B
Common Stock are not Adjusted Conversion Shares, those Adjusted Conversion
Shares shall be converted on a three-for-one basis and the non-Adjusted
Conversion Shares shall be converted on a one-for-one basis. Shares of Class B
Common Stock held by a holder shall automatically convert into Common Stock
immediately prior to the disposition of such shares of Class B Common Stock by
such holder.

A Conversion Event shall be deemed to have occurred (i) in the event of a
disposition of such share of Class B Common Stock by the holder thereof
(excluding dispositions to such holder's affiliates), (ii) in the event any
person not affiliated with the Company acquires beneficial ownership of 15% or
more of the outstanding shares of capital stock of the Company, (iii) in the
event any person not affiliated with the Company offers to acquire 15% or more
of the outstanding shares of capital stock of the Company, (iv) in the event the
holder of such shares elects to so convert at any time after the second
anniversary of the date of this Prospectus, (v) on the sixth anniversary of the
date of this Prospectus, or (vi) in the event the holders of a majority of the
outstanding shares of Common Stock approve such conversion. In addition, the
Company may elect to convert any outstanding shares of Class B Common Stock into
shares of Common Stock in the event 80% or more of the outstanding shares of
Class B Common Stock as of the date of this Prospectus have previously been
converted into shares of Common Stock.

PREFERRED STOCK

The Board of Directors is authorized, without further action by the
stockholders, to provide for the issuance of shares of Preferred Stock as a
class without series or in one or more series, to establish the number of shares
in each class or series and to fix the designation, powers, preferences and
rights of each such class or series and the qualifications, limitations or
restrictions thereof. Because the Board of Directors has the power to establish
the preferences and rights of each class or series of Preferred Stock, the Board
of Directors may afford the holders of any class or series of Preferred Stock
preferences, powers and rights, voting or otherwise, senior to the rights of
holders of Common Stock or the Class B Common Stock. The issuance of Preferred
Stock could have the effect of delaying or preventing a change in control of the
Company. As of the date of this Prospectus, the Company has not issued any
Preferred Stock but the Board has authorized the issuance of the Series A Junior
Participating Preferred Stock of the Company (the "Series A Preferred Stock").
See--"Certain Anti-Takeover and Other Provisions of Delaware Law and the
Company's Certificate of Incorporation and Bylaws." Other than the foregoing,
there are no plans, agreements or understandings for the issuance of any shares
of Preferred Stock.

UNITS RESCISSION OFFER

During the first quarter of 1998, AFC completed a financing of $1.55
million representing 15 1/2 units (the "AFC Units"), consisting of $1,472,500
in non-interest bearing loans (the "AFC Promissory Notes") and 25,840
membership interests in AFC to fund certain expenses on behalf of AMP in
connection with the Offering (the "Bridge Financing"). The Bridge Financing
provided for the loans to be repaid by AFC from funds it will receive from the
Offering. Additionally, AFC is required to repurchase each of the 15 1/2 AFC
Units for $71,667 in cash. In connection with the Bridge Financing, each
investor was to be given the opportunity to notify the Company that he or she
would prefer to purchase $71,667 worth of Common Stock offered in the Offering
valued at the initial public offering price. Upon the closing of the Offering,
AMP will assume this obligation of AFC in satisfaction of amounts due to AFC.

The Company has been advised that the Bridge Financing of AFC may be
integrated for securities laws purposes with the Offering under this Prospectus
and that the 15 1/2 AFC Units sold pursuant to the Bridge Financing for $1.55
million may not have been sold in compliance with the registration provisions of
the

60
<PAGE>

Securities Act. All of these AFC Units were sold at a price of $100,000 per AFC
Unit. Concurrently with the Offering, the Company and AFC are conducting a Units
Rescission Offer with respect to the Bridge Financing. If the Units Rescission
Offer is accepted, the Bridge Financing investors will be paid only the purchase
price of the AFC Units equal to $1.55 million plus statutory interest on the AFC
Units from the date of issuance through the date of purchase. If the Units
Rescission Offer is rejected in full, holders of the AFC Units will continue to
hold AFC Units, the AFC Promissory Notes will be repurchased by AFC for
$1,472,500 in cash and the AFC membership interests will be repurchased by AFC
for $1,110,839 in cash, or a total of $2.58 million, upon the successful
completion of the Company's Offering. In either case, the Bridge Investors will
no longer have the opportunity to purchase shares of Common Stock set aside by
the Company at the initial public offering price. There can be no assurance that
the liability of the Company based upon any possible failure of the Company or
AFC to comply with federal or state securities law in connection with the Bridge
Financing will be eliminated. Upon the conclusion of this Offering, management
does not believe that any of the persons who acquired the AFC Units will assert
any claim with respect thereto, notwithstanding any potential continuing
liability. For the aforementioned reasons, the Company does not believe that the
Units Rescission Offer or any continuing liability under the Securities Act will
have a material adverse effect on the Company.

CERTAIN ANTI-TAKEOVER AND OTHER PROVISIONS OF DELAWARE LAW AND THE COMPANY'S
CERTIFICATE OF INCORPORATION AND BYLAWS

The Company has authorized a dividend distribution of rights (each, a
"Right") to purchase a certain number of units (determined by a formula
described herein) at a price of $33, subject to adjustment (the "Exercise
Price"). Each unit is equal to one one-hundredth of a share of a newly
authorized Series A Preferred Stock. One Right will be distributed per share of
Common Stock and Class B Common Stock of the Company on the record date (the
"Record Date"). Rights will also be distributed in connection with the future
issuance of shares of Common Stock and Class B Common Stock. The description and
terms of the Rights are set forth in a Stockholder Protection Agreement (the
"Agreement") between the Company and a rights agent (the "Rights Agent").

Until the Separation Time (as defined below), the Rights are not
exercisable and certificates for the Rights will not be sent to stockholders.

Subject to certain exceptions described in the Agreement, the Rights will
separate from the Common Stock and the Class B Common Stock, separate
certificates evidencing the Rights (the "Rights Certificates") will be issued
and the Rights will become exercisable 10 business days (the "Separation
Time") following the date on which a person (including its affiliates and
associates) (i) acquires, (ii) obtains the right to acquire or (iii) announces
or commences a tender or exchange offer to acquire beneficial ownership of 15%
or more (or in the case of certain institutional investors, more than 20% of the
outstanding Common Stock (such person thereby becoming an "Acquiring
Person")).

Following the Separation Time, holders of the Rights (the "Rights
Holders") (other than Rights beneficially owned by the Acquiring Person or its
affiliates or associates, which will thereafter be void) will be entitled to
receive upon exercise and payment of the Exercise Price that number of units of
Series A Preferred Stock which equals the result obtained by dividing the
Exercise Price by 50% of the Market Price (as defined in the Agreement) per
share of Common Stock and Class B Common Stock at the Separation Time (subject
to adjustment, if applicable). Each unit of Series A Preferred Stock will be
entitled to one vote on all matters on which share of Common Stock and Class B
Common Stock may vote.

If, after the Separation Time, (i) the Company were to be acquired in a
merger or other business combination transaction in which the Company was not
the surviving corporation nor in which the Company's outstanding Common Stock
were changed or exchanged for cash, stock or assets of another person or (ii)
50% or more of the Company's consolidated assets or earning power were to be
sold (other than in transactions in the ordinary course of business), then
proper provision would be made so that each Rights Holder who has not
theretofore exercised his Rights (other than Rights beneficially owned by the
Acquiring Person or its affiliates or associates, which will thereafter be void)
will thereafter have the right

61
<PAGE>
to receive, upon exercise, a number of shares of common stock of the acquiring
entity having a value equal to two times the Exercise Price.

Each share of Series A Preferred Stock for which Rights had been exercised
prior to a business combination or other transaction of the type referred to in
clause (i) in the immediately preceding paragraph would be entitled to receive
upon consummation thereof 100 times the consideration (cash, securities or other
property, or a combination thereof) that one share of Common Stock would
receive. At any time on or prior to the earlier of (i) the Separation Time or
(ii) the Expiration Date of the Rights, the Company may redeem the Rights in
whole, but not in part, at a price of $.01 per Right (the "Redemption Price").
Immediately upon the action of the Board of Directors authorizing redemption of
the Rights, the right to exercise the Rights will terminate and the only right
of the Rights Holders will be to receive the Redemption Price.

At any time following the Separation Time but before the Expiration Date,
the Company may, at its option, exchange all or any portion of the Rights for
shares of Common Stock at an exchange ratio which equals the Exercise Price
divided by the Market Price per share of Common Stock. The Company, however, may
not effect such an exchange if an Acquiring Person become the owner of 50% or
more of the then outstanding Common Stock.

The Company is subject to the provisions of Section 203 of the General
Corporation Law of the State of Delaware (the "DGCL"). Section 203 prohibits a
publicly held Delaware corporation from engaging in a "business combination"
with an "interested stockholder" for a period of three years after the date of
the transaction in which the person became an interested stockholder, unless the
business combination is approved in a prescribed manner. A "business
combination" includes a merger, asset sale or other transaction resulting in a
financial benefit to the interested stockholder. Subject to certain exceptions,
an "interested stockholder" is a person who, together with affiliates and
associates, owns, or within three years prior to the proposed business
combination, has owned 15% or more of the corporation's voting stock.

The Company's Certificate of Incorporation provides that liability of
directors of the Company is eliminated to the fullest extent permitted under the
DGCL. As a result, no director of the Company will be liable to the Company or
its stockholders for monetary damages for breach of fiduciary duty as a
director, except for liability: (i) for any breach of the director's duty of
loyalty to the Company or its stockholders; (ii) for acts omissions not in good
faith or which involve intentional misconduct or a knowing violation of law;
(iii) for any willful or negligent payment of an unlawful dividend, stock
purchase or redemption; or (iv) for any transaction from which the director
derived an improper personal benefit. The Company's Bylaws generally provide
that the Company shall indemnify its directors, employees and other agents to
the fullest extent provided by Delaware law.

In addition, the Company's Certificate of Incorporation requires the vote
of 60% of the Board of Directors to effect certain actions, including a sale of
substantially all of the assets of the Company, certain mergers and
combinations, and the acquisition of securities representing a majority of the
voting power of the Company. The "supermajority" voting rights could have the
effect of making it more difficult for a third party to acquire, or discouraging
a third party from seeking to acquire, control of the Company.

The Bylaws of the Company provide that stockholders must follow an advance
notification procedure for certain stockholder nominations of candidates for the
Board of Directors and for certain other stockholder business to be conducted at
an annual meeting. These provisions could, under certain circumstances, operate
to delay, defer or prevent a change in control of the Company. The Transfer
Agent and Registrar for the Common Stock is American Securities Transfer &
Trust, Inc.

62
<PAGE>
SHARES ELIGIBLE FOR FUTURE SALE

The market price of the Common Stock of the Company could be adversely
affected by the sale of substantial amounts of the Common Stock in the public
market following the Offering. After giving effect to the sale of the shares of
Common Stock offered hereby, the Company will have 5,778,322 shares of Common
Stock issued and outstanding (6,328,322 shares if the Underwriters'
over-allotment option is exercised in full) (assuming an initial public offering
price of $11.00 per share). Of these shares, 3,700,000 shares (4,255,000 shares
if the Underwriters' over-allotment option is exercised in full) of Common Stock
sold in the Offering will be freely tradable without restriction under the
Securities Act, except for any shares exchanged by "affiliates" of the Company
as that term is defined under the Securities Act. None of the 2,078,322
remaining shares of Common Stock were acquired in a transaction registered under
the Securities Act. Such shares may not be sold except in transactions
registered under the Securities Act or pursuant to an exemption from
registration. All such 2,078,322 shares of Class A Common Stock will be eligible
for sale pursuant to Rule 144 promulgated under the Securities Act in March
1999. In addition, 598,807 shares of Class B Common Stock will be eligible for
sale pursuant to Rule 144 promulgated under the Securities Act and the balance
of these shares will be eligible for sale at various times from June 1998
through October 1998.

In general, under Rule 144 as currently in effect, a person who has (or
persons whose shares are aggregated who have) beneficially owned "restricted"
shares for at least one year, including an "affiliate" of the Company, as that
term is defined in the Securities Act, is entitled to sell within any
three-month period a number of shares of Common Stock that does not exceed the
greater of 1% of the then outstanding shares of Common Stock or the average
weekly trading volume during the four calendar weeks preceding the date on which
notice of the sale is filed with the Commission. Sales under Rule 144 are also
subject to certain manner of sale provisions and the availability of current
public information about the Company. A person who is not an affiliate of the
Company at any time during the three months preceding a sale, and who has
beneficially owned shares for at least two years, would be entitled to sell such
shares without regard to the volume limitations, manner of sale provisions or
notice or other requirements of Rule 144.

In addition, the Company, its officers and directors and certain other
stockholders of the Company have agreed that they will not offer, contract to
sell, announce their intention to sell, pledge or otherwise dispose of, directly
or indirectly, or file with the Commission a registration statement under the
Securities Act relating to any additional shares of Common Stock or securities
convertible or exchangeable or exercisable for any shares of Common Stock
without the prior written consent of the Representative for a period of days
after the date of this Prospectus (the "lock-up period"), except (i)
subsequent sales of Common Stock offered in the Offering, (ii) issuances of
unregistered Common Stock by the Company in connection with affiliation with
practices, physicians and ancillary providers (although persons receiving such
shares would be subject to such restrictions for the remainder of the lock-up
period) or (iii) issuances of Common Stock by the Company pursuant to the
exercise of employee stock options outstanding on the date of this Prospectus.

Pursuant to an agreement with the Company, the holders of all shares of
Common Stock outstanding on the date of this prospectus have certain
registration rights with respect to such shares and additional shares that may
be issued to such persons upon exercise of options (subject to certain
limitations on the number of shares such holders are entitled to have registered
under any registration statement), although the holders of at least 2,078,322 of
these shares of Class A Common Stock and all holders of Class B Common Stock
(including all AFC members to whom shares of Class B Common Stock will be
distributed) have agreed to refrain from selling their shares during the lock-up
period. Pursuant to the Registration Rights Agreements, the Company has granted
certain registration rights to the DPMs permitting them to include their shares
of Common Stock on a registration statement filed by the Company within one year
of the date of such agreements. The Company intends to register an additional
1,157,098 shares of Common Stock reserved for issuance under the 1997 Plan as
soon as practicable after expiration of the lock-up period. In addition, the
Company will register up to an additional 2,000,000 shares of Common Stock under
a shelf registration, which, when combined with the Company's cash resources,
will be used to fund the Company's planned program of affiliating with
Affiliated Practices and providers of ancillary services and facilities. These
shares generally will be freely tradable upon issuance to persons not deemed to
be affiliates of the Company, unless the Company contractually restricts the
sale or other transfer of such shares. Initially, the Company will issue such
shares subject to a lock-up period of up to 180 days from the date of this
Prospectus. See "Underwriting."

63
<PAGE>
UNDERWRITING

The Underwriters named below have severally agreed with the Company,
subject to the terms and conditions of the Underwriting Agreement, to purchase
the respective number of shares of Common Stock set forth opposite their names
below:

UNDERWRITER NUMBER OF SHARES
- ------------------------------------- -----------------
A.G. Edwards & Sons, Inc.............
J.C. Bradford & Co. .................

-----------------
Total......................... 3,700,000
=================

In the Underwriting Agreement, the Underwriters have agreed, subject to the
terms and conditions set forth therein, to purchase all of the shares of Common
Stock offered hereby, if any of such shares are purchased.

The Company has been advised by the Underwriters that the Underwriters
propose to offer the shares of Common Stock to the public at the offering price
set forth on the cover page of this Prospectus and to certain dealers at such
price less a concession not in excess of $ per share. The Underwriters and
such dealers may reallow a discount of not in excess of $.10 per share to
certain other dealers. The public offering price and the concession and discount
to dealers may be changed by the Underwriters after the Offering.

The Offering of the shares of Common Stock is made for delivery when, as
and if accepted by the Underwriters and subject to prior sale and to withdrawal,
cancellation or modification of the offer without notice. The Underwriters
reserve the right to reject any offer for the purchase of shares.

The Company has granted the Underwriters an option, expiring at the close
of business on the 45th day subsequent to the date of the Underwriting
Agreement, to purchase up to 555,000 additional shares of Common Stock at the
public offering price, less the underwriting discount set forth on the cover
page of this Prospectus. The Underwriters may exercise such option solely to
cover over-allotments, if any, in the sale of the shares. To the extent the
Underwriters exercise such option, each of them will have a firm commitment,
subject to certain conditions, to purchase approximately the same percentage of
the option shares as the number of shares set forth opposite each Underwriter's
name in the preceding table bears to 3,700,000, and the Company will be
obligated to sell such shares to the Underwriters.

The Underwriting Agreement provides that the Company will indemnify the
Underwriters against certain liabilities, including liabilities under the
Securities Act, or will contribute to payments that the Underwriters may be
required to make in respect thereof.

The Company, all Directors and Executive Officers of the Company and
certain other holders of Common Stock prior to the Offering have agreed that
they will not, directly or indirectly, offer, sell or otherwise dispose of any
shares of Common Stock or any securities convertible into or exercisable or
exchangeable for, or any rights to purchase or acquire, Common Stock for a
period of 180 days after the date of this Prospectus without the prior written
consent of A.G. Edwards & Sons, Inc. other than the exercise of options
previously granted under the Company's director and employee benefit plans and
agreements. See "Shares Eligible for Future Sale."

The Underwriters have advised the Company that they do not intend to
confirm sales to any account over which they exercise discretionary authority.

Prior to the Offering, there has been no established trading market for the
Common Stock. The initial price to the public for the Common Stock offered
hereby has been determined by negotiation among the

64
<PAGE>

Company and the representatives of the Underwriters. The factors considered in
determining the initial price to the public include the history of and the
prospects for the industry in which the Company operates, the ability of the
Company's management, the past and present operations of the Company, the
historical results of operations of the Company, the prospects for future
operating income and earnings of the Company and the trends of such operating
income and earnings, the general condition of the securities markets at the time
of the Offering, and the recent market prices of securities of generally
comparable companies. There can be no assurance, however, that the prices at
which the Common Stock will sell in the public market after the Offering will
not be lower than the price at which they are sold by the Underwriters.

In connection with the Offering, the Underwriters and other persons
participating in the Offering may engage in transactions that stabilize,
maintain or otherwise affect the price of the Common Stock. Specifically, the
Underwriters may over-allot in connection with the Offering, creating a short
position in the Common Stock for their own account. To cover over-allotments or
to stabilize the price of the Common Stock, the Underwriters may bid for, and
purchase, shares of the Common Stock in the open market. The Underwriters may
also impose a penalty bid whereby they may reclaim selling concessions allowed
to an underwriter or dealer for distributing the Common Stock in the Offering,
if the Underwriters repurchase previously distributed Common Stock in
transactions to cover their short position, in stabilization transaction or
otherwise. Finally, the Underwriters may bid for, and purchase, shares of the
Common Stock in market making transactions. These activities may stabilize or
maintain the market price of the Common Stock above market levels that may
otherwise prevail. The Underwriters are not required to engage in these
activities and may end any of these activities at any time. See "Principal
Stockholders."

LEGAL MATTERS

The validity of the Common Stock offered hereby will be passed upon for the
Company by Baker & Hostetler LLP. As a result of his membership in AFC, a
partner of Baker & Hostetler LLP will be distributed approximately 4,273 shares
of Class B Common Stock and one of counsel attorney at Baker & Hostetler LLP
holds 18,038 shares of Class B Common Stock and will be distributed
approximately 2,991 shares of Class B Common Stock as a result of his membership
in AFC. In addition, such of counsel attorney (i) is participating in the Bridge
Financing and will receive repayment of the $95,000 AFC Promissory Note issued
to him by AFC and AFC will repurchase his membership interests for $71,667 in
cash and (ii) is making a short-term loan to AFC in the principal amount of
$50,000 to be repaid with $33,334 in interest. Certain legal matters in
connection with the Offering made hereby will be passed upon for the
Underwriters by McDermott, Will & Emery, Chicago, Illinois. The Underwriters are
not parties to the Units Rescission Offer and none of the legal matters relating
thereto shall be passed upon by McDermott, Will & Emery.

EXPERTS

The financial statements of American Medical Providers, Inc., Pyramid
Anesthesiology Group, Inc. and Bellaire Surgicare, Inc. appearing in this
Prospectus and Registration Statement have been audited by Arthur Andersen LLP,
independent public accountants, as indicated in their reports with respect
thereto, and are included herein in reliance upon the authority of such firm as
experts in giving said reports.

ADDITIONAL INFORMATION

The Company has filed with the Commission a Registration Statement on Form
S-1 under the Securities Act (the "Registration Statement") with respect to
the shares of Common Stock offered hereby. This Prospectus, which constitutes a
part of the Registration Statement, does not contain all of the information set
forth in the Registration Statement, including the exhibits and schedules
thereto. For further information with respect to the Company and the shares of
Common Stock, reference is made to the Registration Statement. Statements
contained in this Prospectus as to the contents of any contract or other
document are not necessarily complete and in each instance reference is made to
the copy of such contract or other document filed as an exhibit to the
Registration Statement, each such statement being qualified in all respects by
such reference. The Registration Statement, including the exhibits and schedules
thereto,

65
<PAGE>
may be inspected without charge at the principal office of the Commission at
Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549, and the
Commission's Regional Offices at Seven World Trade Center, Suite 1300, New York,
New York 10048, and Northwest Atrium Center, 500 West Madison Street, Suite
1400, Chicago, Illinois 60661, and copies may be obtained at prescribed rates
from the Public Reference Section of the Commission at 450 Fifth Street, N.W.,
Washington, D.C. 20549. In addition, the Registration Statement and certain
other filings made with the Commission through its Electronic Data Gathering
Analysis and Retrieval ("EDGAR") system are publicly available through the
Commission's site on the Internet's World Wide Web, located at
http://www.sec.gov. The Registration Statement, including all exhibits thereto
and amendments thereof, has been filed with the Commission through EDGAR.

66
<PAGE>

SPECIAL NOTE

The Company believes that the disclosure contained in this Prospectus
provides the Bridge Investors with all material information relevant to their
investment decision to accept or reject the Units Rescission Offer. The Company
has not included the financial statements of Ankle & Foot Centers of America,
LLC ("AFC") separately herein because such financial statements would be
substantially similar to the financial statements of the Company in that the
Company's financial statements reflect the costs and expenses incurred by AFC on
behalf of the Company for the Company's organization and development. Such costs
and expenses are treated as transactions of the Company in the Company's
financial statements. In addition, the financial statements of the Company are
relevant to the Bridge Investors in that such Bridge Investors will be repaid by
AFC with funds received by AFC from the Company's initial public offering.

67
<PAGE>
INDEX TO FINANCIAL STATEMENTS

PAGE
----
AMERICAN MEDICAL PROVIDERS, INC.
Report of Independent Public
Accountants....................... F-2
Balance Sheets..................... F-3
Statements of Operations........... F-4
Statements of Stockholders'
Deficit........................... F-5
Statements of Cash Flows........... F-6
Notes to Financial Statements...... F-7

PYRAMID ANESTHESIOLOGY GROUP, INC.
Report of Independent Public
Accountants....................... F-17
Balance Sheets..................... F-18
Statements of Operations........... F-19
Statements of Stockholders'
Equity............................ F-20
Statements of Cash Flows........... F-21
Notes to Financial Statements...... F-22

BELLAIRE SURGICARE, INC.
Report of Independent Public
Accountants....................... F-25
Balance Sheets..................... F-26
Statements of Operations........... F-27
Statements of Shareholders'
Equity............................ F-28
Statements of Cash Flows........... F-29
Notes to Financial Statements...... F-30

UNAUDITED PRO FORMA COMBINED BALANCE
SHEET
Introduction to Unaudited Pro Forma
Combined Balance Sheet............ F-34
Unaudited Pro Forma Combined
Balance Sheet..................... F-35
Notes to Unaudited Pro Forma
Combined Balance Sheet............ F-36

F-1
<PAGE>
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS

To American Medical Providers, Inc.:

We have audited the accompanying balance sheets of American Medical
Providers, Inc., a development-stage enterprise and a Delaware corporation (the
"Company"), as of December 31, 1996 and 1997, and the related statements of
operations, stockholders' deficit and cash flows for the period from inception
(August 9, 1996) to December 31, 1996 and for the year ended December 31, 1997.
These financial statements are the responsibility of the Company's management.
Our responsibility is to express an opinion on these financial statements based
on our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of American Medical Providers,
Inc. as of December 31, 1996 and 1997, and the results of its operations and its
cash flows for the period from inception (August 9, 1996) to December 31, 1996
and for the year ended December 31, 1997, in conformity with generally accepted
accounting principles.

ARTHUR ANDERSEN LLP
Houston, Texas
March 4, 1998

F-2
<PAGE>
AMERICAN MEDICAL PROVIDERS, INC.
(A DEVELOPMENT-STAGE ENTERPRISE)
BALANCE SHEETS

DECEMBER 31, DECEMBER 31,
1996 1997
------------ ------------
ASSETS
CURRENT ASSETS:
Cash............................ $ -- $ --
Deferred issuance costs......... 404,622 3,672,703
Other current assets............ 12,092 14,700
------------ ------------
Total current assets....... 416,714 3,687,403
NON-CURRENT ASSETS:
Equipment, at cost.............. 116,648 541,580
Less - Accumulated
depreciation................... (5,258) (34,745)
------------ ------------
Equipment, net............. 111,390 506,835
------------ ------------
Total assets............... $ 528,104 $ 4,194,238
============ ============

LIABILITIES AND STOCKHOLDERS' DEFICIT
CURRENT LIABILITIES:
Accounts payable................ $ 262,806 $ 2,156,615
Accrued expenses................ 166,970 605,779
Due to stockholder.............. 612,269 4,042,521
------------ ------------
Total current
liabilities............ 1,042,045 6,804,915
------------ ------------
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' DEFICIT:
Preferred Stock, $.001 par
value; 20,000,000 shares
authorized, no shares issued
and outstanding................ -- --
Class A Common Stock, $.001 par
value; 20,000,000 shares
authorized, no shares issued
and outstanding................ -- --
Class B Common Stock, $.001 par
value; 1,000,000 shares
authorized, 650,000 shares
issued and outstanding......... 650 650
Additional paid-in capital...... 921,850 1,531,369
Deficit accumulated during the
development stage.............. (1,436,441) (4,142,696)
------------ ------------
Total stockholders'
deficit................ (513,941) (2,610,677)
------------ ------------
Total liabilities and
stockholders'
deficit................ $ 528,104 $ 4,194,238
============ ============

The accompanying notes are an integral part of these financial statements.

F-3
<PAGE>

AMERICAN MEDICAL PROVIDERS, INC.
(A DEVELOPMENT-STAGE ENTERPRISE)
STATEMENTS OF OPERATIONS

FOR THE PERIOD
FROM INCEPTION
(AUGUST 9, YEAR
1996) TO ENDED
DECEMBER 31, DECEMBER 31,
1996 1997
--------------- ------------
REVENUES............................. $ -- $ --
EXPENSES:
Salaries, wages and benefits.... 1,323,618 1,105,003
General and administrative...... 107,565 1,050,687
Interest expense................ -- 521,078
Depreciation expense............ 5,258 29,487
--------------- ------------
Total expenses........ 1,436,441 2,706,255
--------------- ------------
LOSS BEFORE INCOME TAXES............. (1,436,441) (2,706,255)
INCOME TAX BENEFIT................... -- --
--------------- ------------
NET LOSS............................. $(1,436,441) $ (2,706,255)
=============== ============

The accompanying notes are an integral part of these financial statements.

F-4
<PAGE>
AMERICAN MEDICAL PROVIDERS, INC.
(A DEVELOPMENT-STAGE ENTERPRISE)
STATEMENTS OF STOCKHOLDERS' DEFICIT

<TABLE>
<CAPTION>
DEFICIT
CLASS A CLASS B ACCUMULATED
PREFERRED STOCK COMMON STOCK COMMON STOCK ADDITIONAL DURING THE
--------------- --------------- ---------------- PAID-IN DEVELOPMENT
SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT CAPITAL STAGE
------ ------ ------ ------ ------- ------ ---------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
INITIAL CAPITALIZATION
AUGUST 9, 1996 (Inception)......... -- $-- -- $-- 650,000 $650 $ -- $ --
Capital contribution attributed
to non-cash compensation
charge......................... -- -- -- -- -- -- 921,850 --
Net loss......................... -- -- -- -- -- -- -- (1,436,441)
------ ------ ------ ------ ------- ------ ---------- -----------
BALANCE AT DECEMBER 31, 1996......... -- -- -- -- 650,000 650 921,850 (1,436,441)
Captial contribution attributed
to non-cash compensation
charge......................... -- -- -- -- -- -- 319,760 --
Other contributed capital........ -- -- -- -- -- -- 289,759 --
Net loss......................... -- -- -- -- -- -- -- (2,706,255)
------ ------ ------ ------ ------- ------ ---------- -----------
BALANCE AT DECEMBER 31, 1997......... -- $-- -- $-- 650,000 $650 $1,531,369 $(4,142,696)
====== ====== ====== ====== ======= ====== ========== ===========
</TABLE>
STOCKHOLDERS'
DEFICIT
-------------
INITIAL CAPITALIZATION
AUGUST 9, 1996 (Inception)......... $ 650
Capital contribution attributed
to non-cash compensation
charge......................... 921,850
Net loss......................... (1,436,441)
-------------
BALANCE AT DECEMBER 31, 1996......... (513,941)
Captial contribution attributed
to non-cash compensation
charge......................... 319,760
Other contributed capital........ 289,759
Net loss......................... (2,706,255)
-------------
BALANCE AT DECEMBER 31, 1997......... $(2,610,677)
=============

The accompanying notes are an integral part of these financial statements.

F-5
<PAGE>
AMERICAN MEDICAL PROVIDERS, INC.
(A DEVELOPMENT-STAGE ENTERPRISE)
STATEMENTS OF CASH FLOWS

FOR THE PERIOD
FROM INCEPTION
(AUGUST 9, YEAR
1996) TO ENDED
DECEMBER 31, DECEMBER 31,
1996 1997
-------------- ------------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss........................... $ (1,436,441) $ (2,706,255)
Adjustments to reconcile net loss
to net cash used in operating
activities --
Non-cash compensation and
consulting expense............. 921,850 319,760
Non-cash capital
contributions.................. -- 289,759
Depreciation.................... 5,258 29,487
Changes in assets and
liabilities --
Deferred issuance costs....... (404,622) (3,268,081)
Other current assets.......... (11,442) (2,608)
Accounts payable.............. 262,806 1,893,809
Accrued expenses.............. 166,970 438,809
-------------- ------------
Net cash used in
operating
activities......... (495,621) (3,005,320)
-------------- ------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of equipment............. (116,648) (424,932)
-------------- ------------
Net cash used in
investing
activities......... (116,648) (424,932)
-------------- ------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Advances from stockholders......... 612,269 3,430,252
-------------- ------------
Net cash provided by
financing
activities......... 612,269 3,430,252
-------------- ------------
NET CHANGE IN CASH................... -- --
CASH, beginning of period............ -- --
-------------- ------------
CASH, end of period.................. $ -- $ --
============== ============

The accompanying notes are an integral part of these financial statements.

F-6
<PAGE>
AMERICAN MEDICAL PROVIDERS, INC.
(A DEVELOPMENT-STAGE ENTERPRISE)
NOTES TO FINANCIAL STATEMENTS

1. BUSINESS AND ORGANIZATION

American Medical Providers, Inc. (the "Company" or "AMP") was founded
in August 1996 to provide physician practice management services and
comprehensive foot care delivery systems to podiatric practices throughout the
United States. Simultaneously with, and as a condition to the closing of an
initial public offering (the "Offering"), 46 separate podiatric practices will
transfer (the "Transfers") either certain of their operating assets and
accounts receivable or stock to the Company in exchange for cash, shares of
class A common stock (the "Common Stock") and the assumption of certain
indebtedness (these practices, including the practice relating to the Kramer
Transfer and the Ambulatory Surgery Center Acquisitions discussed below,
collectively referred to as the "Affiliated Practices"). The Company will own
the operating assets and receivables of the Affiliated Practices, hire their
non-physician employees and otherwise assume the management of each practice.
The doctors of podiatric medicine ("DPMs") will join regional group practices
organized by geographic location (the "Regional Group Practices"). The Company
will enter into a long-term management agreement with each Regional Group
Practice under which AMP will receive fees for its services. At the time of the
Offering, AMP will acquire in a purchase accounting transaction Pyramid
Anesthesiology Group, Inc. ("AnestheCare") (the "AnestheCare Acquisition"),
an anesthesiology management services organization. The Company will also
acquire the stock of one of the Affiliated Practices in a transaction to be
accounted for as a purchase (the "Kramer Transfer"). The Transfers, the
AnestheCare Acquisition and the Kramer Transfer are collectively referred to as
the "Transactions." Each owner DPM of the Affiliated Practices and AnestheCare
is considered a "promoter" of the Company.

The Company has had no on-going, non-developmental business operations to
date, and the financial statements have been prepared on the basis that the
proposed Transactions will occur, although no assurance can be made that the
proposed Transactions will be completed or that the Company will be successful
in completing planned future acquisitions. If the Company is unable to
successfully complete the Offering, the Company will be unable to satisfy its
obligations including those to AFC (see below). The Company intends to expand by
affiliating with additional podiatric practices throughout the United States. In
order to expand, the Company will need additional capital in the form of debt or
equity financing. There can be no assurance that such capital will be available.

Ankle & Foot Centers of America, LLC ("AFC") was formed to fund the
organization and development of AMP through the date of the Offering. Thus, for
purposes of these financial statements, costs and expenses incurred by AFC are
treated as transactions of AMP. Upon the Offering's consummation, AMP will
reimburse AFC for all costs and expenses that AFC has incurred to the Offering
date and will assume all liabilities of AFC with respect to AMP. Accordingly,
all amounts actually incurred by AFC on behalf of AMP with respect to such
costs, expenses and liabilities are reflected in these financial statements of
AMP as amounts due to stockholder.

Certain of the Promoter DPMs (defined below) have made investments in AFC
either individually or participate in organizations which have invested in AFC.
Consequently, it is anticipated that certain of these Promoters will be
distributed shares of AMP as a result of their ownership in AFC. In addition,
certain Promoter DPMs who are also directors of AMP will participate in the
directors stock option plan. See "Distribution of Class B Common Stock to
Promoters Participating in AFC Financings" included on page 52 of this
Registration Statement for further discussion.

THE TRANSACTIONS

All of the Transfers of the initial Affiliated Practices (together with
AMP, "the Promoters"), except for the acquisition of two ambulatory surgery
centers included in the Transfers (collectively, the "Ambulatory Surgery Center
Acquisitions") and the Kramer Transfer, will be accounted for by the Company
under

F-7
<PAGE>
AMERICAN MEDICAL PROVIDERS, INC.
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

Securities and Exchange Commission Staff Accounting Bulletin ("SAB") No. 48,
"Transfers of Non-Monetary Assets by Promoters or Shareholders," such that the
non-monetary assets and liabilities of these initial Affiliated Practices will
be received by the Company at the transferor's historical cost basis for
accounting purposes. The Ambulatory Surgery Center Acquisitions, the AnestheCare
Acquisition, in which the Company will acquire assets of an anesthesiology
management services organization located in Georgia, and the Kramer Transfer, in
which the Company will acquire the stock of Dr. Kramer's podiatric practice in
Georgia, will not be accounted for under SAB 48. Instead, these and all future
individual practice affiliations will be accounted for as purchases at fair
market value and are expected to result in purchase prices in excess of net
assets acquired (goodwill) which will require subsequent annual noncash
amortization charges in the Company's statements of operations. Monetary assets
and liabilities, including cash, billed and unbilled receivables and credit
balances, payables and certain miscellaneous accruals will either be acquired by
AMP at their fair market value or retained by the Affiliated Practices, as
agreed among the parties.

In connection with the Transfers, AMP will acquire certain operating
assets, accounts receivable or the stock of entities holding the non-monetary
assets of the 46 separate Affiliated Practices in exchange for a combination of
cash, shares of Common Stock and assumed liabilities, and will enter into
long-term management agreements with the Regional Group Practices. The aggregate
consideration to be paid by the Company in the Transfers is approximately $34.5
million, consisting of approximately $18.3 million payable in shares of Common
Stock at the initial public offering price attributed to the net non-monetary
assets, approximately $4.7 million in cash and $156,000 of assumed indebtedness
attributed to the net non-monetary assets of the SAB 48 Transfers, $4.3 million
in cash attributed to the net monetary assets of the SAB 48 Transfers, $4.1
million payable in shares of Common Stock at the initial public offering price,
$1.0 million in cash and $500,000 of assumed indebtedness attributed to the
Ambulatory Surgery Center Acquisitions which are included in the Transfers but
not accounted for under SAB 48, and $1.4 million in cash attributed to the
Kramer Transfer. Of the total consideration attributed to the non-monetary
assets for each SAB 48 transaction, the Affiliated Practices could elect to
receive up to 25% in cash and the balance in shares of Common Stock based on the
initial offering price. The non-monetary assets and liabilities of these
Affiliated Practices excluding the Ambulatory Surgery Center Acquisitions and
the Kramer Transfer, will carry over to AMP at their historical costs. The
number of shares to be issued is contingent upon the Offering price and will not
be determined until the Offering date. The assets to be transferred include
cash, billed and unbilled receivables, supplies inventory, other receivables,
prepaid expenses, net equipment and certain other current and noncurrent assets.
The liabilities to be transferred include credit balances of accounts
receivable, certain miscellaneous payables and accruals and debt assumed. Cash
and liabilities assumed totaling approximately $4.7 million paid to the
Affiliated Practices for the non-monetary assets will be recorded as a dividend
by the Company. Consideration in the AnestheCare Acquisition will consist of
approximately $4.5 million in cash. Additional consideration of up to $1.5
million in cash and a number of shares of Common Stock equal to $500,000 valued
at the initial offering price, may be paid to the owners of AnestheCare pending
AnestheCare's achievement of certain performance targets over a three-year
period beginning January 1, 1998.

The Company's methodology for valuing the non-monetary assets in the
Transfers was primarily based upon a multiple of the projected earnings
contribution to AMP utilizing adjusted historical financial information of the
respective Affiliated Practices.

F-8
<PAGE>
AMERICAN MEDICAL PROVIDERS, INC.
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

DEFERRED ISSUANCE COSTS

The Company has incurred certain costs including legal, accounting and
other professional services associated with the Transactions and the Offering.
These costs have been deferred pending the consummation of the Transactions and
the Offering.

REVENUE RECOGNITION

Revenues from managing the practices and ancillary operations will be
recognized on a monthly basis as the services are provided. The revenue of AMP
will consist of the sum of the management fees and an amount equal to the
operating expenses of the podiatric practice assumed by AMP under the management
agreements and owned ancillary operations. In general, the management agreements
provide for the payment of fees to the Company based on a negotiated percentage
of the adjusted patient revenue of the podiatric practice and ancillary
operations. Adjusted patient revenue is net patient revenue, as determined under
generally accepted accounting principles, including adjustments for contractual
allowances and other discounts, plus an adjustment for uncollectible accounts.
Expenses not required to be paid by AMP pursuant to the agreements primarily
consist of certain professional expenses of the podiatrist.

INCOME TAXES

The Company follows the liability method of accounting for income taxes in
accordance with Statement of Financial Accounting Standards (SFAS) No. 109.
Under this method, deferred income taxes are recorded based upon the differences
between the financial reporting and tax bases of assets and liabilities and are
measured using the enacted tax rates and laws that will be in effect when the
underlying assets or liabilities are recovered or settled.

Since inception, the Company has incurred losses and is dependent upon the
consummation of the Transactions and the Offering to generate future income.
Accordingly, a full valuation allowance has been provided on tax benefits
generated during the development stage.

STOCK OPTIONS

The Company anticipates accounting for the issuance of options to employees
in accordance with Accounting Principles Board (APB) Opinion No. 25,
"Accounting for Stock Issued to Employees." Options issued to employees at an
exercise price at or above fair value at the date of grant would require no
compensation expense to be recorded under APB Opinion No. 25. In addition,
Statement of Financial Accounting Standards (SFAS) No. 123 "Accounting for
Stock-Based Compensation"(SFAS 123) will require pro forma disclosure
reflecting the effect of recording the employee stock options under SFAS 123
which would require compensation expense based upon the fair value of the equity
instrument granted over the expected vesting period. Options issued to
non-employees will be accounted for under SFAS No. 123. Options issued to
non-employees require compensation expense to be recorded for the fair value of
the equity instrument granted over the expected vesting period.

EARNINGS PER SHARE

Earnings per share has been excluded from the financial statements because
the Company has limited historical operations and does not have a significant
operating history. Accordingly, earnings per share is less meaningful.

USE OF ESTIMATES AND ASSUMPTIONS

The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect certain reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the

F-9
<PAGE>
AMERICAN MEDICAL PROVIDERS, INC.
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

reported amounts of revenues and expenses during the reporting period.
Accordingly, actual results could differ from those estimates.

ACCOUNTING PRONOUNCEMENTS

In November 1997, the Emerging Issues Task Force (EITF) of the Financial
Accounting Standards Board issued EITF Consensus 97-2 regarding various
accounting matters relating to the physician practice management industry. This
pronouncement, which was along expected guidelines published during the
deliberation period, did not negatively impact the planned transaction or the
proposed accounting for the transactions and future accounting for AMP. The
pronouncement clarifies that stock options issued to non-employees of the
Company, such as the DPM's in the Regional Group Practices, do not qualify for
employee stock option accounting. Thus any such options issued to non employee
DPM's will be charged to the income statement over the period benefitted. As
expected, further affiliations with podiatric practices will need to be
accounted for as a contractual relationship with the excess of purchase price
paid over net assets acquired being assigned to an intangible asset and
amortized over future periods. As required by this pronouncement, the Company
will recognize only the management fees and cost reimbursements as revenues, but
will not include patient revenues in the accompanying financial statements.

3. COMMITMENTS AND CONTINGENCIES

The Company will be subject to certain government regulations at the
federal and state levels. In compliance with certain regulatory requirements,
the Company will not control the practice of podiatry. There can be no assurance
that the legality of any long-term management services agreements that will be
entered into will not be successfully challenged. There also can be no assurance
that the laws and regulations of states in which the Company will maintain
operations will not change or be interpreted in the future to restrict or
further restrict the Company's relationship with podiatrists.

Podiatrists may be subject to legal liability suits while under management
or physician engagement agreements with the Company. The Company will not
control or employ the podiatrists; however, the Company intends to acquire
certain liability insurance.

During September 1997, AFC entered into a loan and security agreement which
resulted in borrowings of $500,000 from a third party. The borrowings bear
interest at an annual rate of 18%, payable quarterly, and are due March 31, 1998
or the fifth day following the date of the initial public offering of AMP.
Proceeds under the loan are being used by AFC to fund certain expenses on behalf
of AMP in conjunction with AMP's proposed initial public offering. Upon the
closing of the Offering, AMP will assume this obligation of AFC in satisfaction
of amounts due to AFC. Interest expense totaling $26,250 attributed to these
borrowings has been accrued as of December 31, 1997.

During the first quarter of 1998, AFC completed a financing of $1.55
million (the "Bridge Financing"), representing $1,472,500 in non-interest
bearing loans and $77,500 representing 15 1/2 membership units in AFC to fund
certain expenses on behalf of AMP, in conjunction with AMP's proposed initial
public offering. The financing provides for the loans to be repaid by AFC from
funds it will receive from AMP's initial public offering. Additionally, AFC is
required to repurchase each of the membership units in AFC for $71,667 in cash.
In connection with the Offering, each unit provided the investor the opportunity
to keep such cash or purchase $71,667 worth of AMP Common Stock offered in the
Offering valued at the initial public offering price. Upon the closing of the
Offering, AMP will assume this obligation of AFC in satisfaction of amounts due
to AFC. AMP will recognize a charge totaling $1.03 million during the period
through settlement of this obligation representing the difference between the
$1.55 million face value of the obligation and the $2.58 million settlement
value, of which $205,069 has been accrued as of December 31, 1997 and is
included in interest expense in the accompanying financial statements.

F-10
<PAGE>
AMERICAN MEDICAL PROVIDERS, INC.
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

The Bridge Financing was offered and sold by AFC in reliance on certain
exemptions from registration under the Securities Act of 1933 (the "Act").
Because the Bridge Financing was not completed when the Company filed a
registration statement with the Securities and Exchange Commission (the
"Commission") pursuant to a public offering of the Company's stock, an
argument could be made that the consummation of the Company's public offering
caused such exemptions to be unavailable retroactively. Consequently, the
Company has registered the Bridge Financing and is offering the investors
thereof the opportunity to rescind their investment (the "Bridge Financing
Rescission Offer"). If this rescission offer is accepted, the investors in the
Bridge Financing will be repaid the amount of their original $1.55 million
investment, plus interest at the applicable statutory rate from the date of
issuance. If the rescission offer is rejected, the investors in the Bridge
Financing will be repaid a total of $2.58 million. Whether the units rescission
offer is accepted or rejected, bridge investors will not retain the right to
have any common stock set aside to purchase at the initial public offering
price. In either case, Bridge Investors will continue to have certain rights of
redress as permitted under the Securities Act and its statute of limitations and
applicable state securities laws. There can be no assurance that the liability
of the Company based upon any possible failure of the Company or AFC to comply
with federal or state securities laws in connection with the Bridge Financing
will be eliminated. Upon the conclusion of the Offering, management does not
believe that any of the persons who acquired the AFC Units will assert any claim
with respect thereto, notwithstanding any potential continuing liability. For
the aforementioned reasons, the Company does not believe that the Units
Rescission Offer or any continuing liability under the Securities Act will have
a material adverse effect on the Company.

Between November 5, 1997 and February 11, 1998, the Company entered into
negotiations with and delivered non-binding letters of intent to thirteen
holders of certain operating assets of, or the stock of entities holding certain
operating assets of, twelve podiatric practices (the Practice Owners) by which
each Practice Owner was to come to an agreement with the Company to dispose of
certain operating assets of, or the stock of entities holding certain operating
assets of, such Practice Owner's podiatric practices (the "Letters of
Intent"). The Company has subsequently determined that its negotiations with
and deliveries of Letters of Intent to the Practice Owners may constitute an
offer to sell Common Stock inconsistent with the prospectus delivery
requirements of the Act. In order to limit its potential liability under the
Act, the Company is undertaking a rescission offer (the "Practice Owner
Rescission Offer") with respect to any potential offer made within or outside
of the Letters of Intent.

Practice Owners may accept the Practice Owner Rescission Offer or reject
the Practice Owner Rescission Offer. To the extent that a Practice Owner accepts
the Practice Owner Rescission Offer, the Company takes the position that its
potential liability based upon any possible failure of the Company to comply
with the Act by negotiating and delivering the Letters of Intent without a
prospectus will be eliminated. If a Practice Owner accepts the Practice Owner
Rescission Offer, the previous Letters of Intent will be deemed cancelled. A
Practice Owner will receive no other consideration by accepting the Practice
Owner Rescission Offer. To the extent that a Practice Owner rejects the Practice
Owner Rescission Offer he

F-11
<PAGE>
AMERICAN MEDICAL PROVIDERS, INC.
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

or she will retain whatever rights he or she presently has under the Act in
connection with the earlier Letter of Intent.

It is the position of the Staff of the Securities and Exchange Commission
that any liability of the Company under the Act for the Practice Owner
Rescission Offer may survive and not be barred by the Practice Owner Rescission
Offer. However, it is possible that a court would hold that the legal remedies
available to the Practice Owners are diminished as a result of the Practice
Owner Rescission Offer. Although the legal principles applicable to a
transaction such as the Practice Owner Rescission Offer are not clear, among
possible bases for such a determination are that any Practice Owners who accept
the Rescission Offer thereby will have entered into an accord and satisfaction
that moots any claim for damages and that any such Practice Owners who reject
the Practice Owner Rescission Offer may have waived or be estopped from
asserting his or her rights by failing to accept the Practice Owner Rescission
Offer.

4.__STOCKHOLDERS' EQUITY

The Company has authorized for issuance 1,000,000 shares of Class B Common
Stock, $.001 par value, and has issued 650,000 shares, of which 365,625 shares
have been issued to AFC and 284,375 shares to AFC management. In addition,
certain members of management and consultants to the Company received 440,250
and 51,000 membership interests in AFC during 1996 and for the year ended
December 31, 1997, respectively. AFC management plans to distribute the AMP
shares held by AFC to AFC members and to certain members of AFC management. The
Company has recognized a non-cash compensation charge of $921,850 and $319,760
during 1996 and 1997, respectively, representing the difference between the
amount paid for these interests and the estimated fair value of these interests
and the AMP shares issued.

On February 17, 1998, the Company authorized 20,000,000 shares of Class A
Common Stock, par value $.001 per share ("Common Stock"), 1,000,000 shares of
Class B Common Stock, par value $.001 per share ("Class B Common Stock") and
20,000,000 shares of preferred stock, par value $.001 per share. Immediately
thereafter, the Company converted each share of its existing 20,000 shares of
common stock, par value $.01 per share, into 32.5 shares of the Company's Class
B Common Stock. Accordingly, the historical share data has been restated for all
periods presented. The Class B Common Stock is convertible into Common Stock, at
the option of the holder thereof, upon the occurrence of a Conversion Event (as
defined). The maximum number of shares of Common Stock that may be issued upon
conversion of the Class B Common Stock is 1,950,000. The Class B Common Stock
converts into Class A Common Stock on a share-for-share basis, provided however,
that if the Common Stock reaches certain average closing prices over a 15-day
period during the next six years on the Nasdaq National Market, other
over-the-counter market or an exchange, as then applicable (the "Trading
Market"), then the conversion ratio with respect to a certain number of shares
of Class B Common Stock will immediately change so that such shares will
thereafter be convertible into Common Stock at the ratio of three shares of
Common Stock for each share of Class B Common Stock (each such share an
"Adjusted Conversion Share").

On the date that the average closing price on the Trading Market for the
preceding 15 consecutive trading days (the "Average Price") exceeds 150% of
the price to the public in the Offering, 130,000 of the issued shares of Class B
Common Stock will immediately become Adjusted Conversion Shares (and subject to
the new three-for-one conversion ratio). Thereafter, the remaining 520,000
shares of Class B Common Stock will become Adjusted Conversion Shares in four
remaining increments of 130,000 shares of Class B Common Stock each (20% of the
total number of shares of Class B Common Stock issued) upon the attainment of
new Average Prices. The Average Prices applicable to each new 20% increment will
equal 120% of each preceding Average Price applicable to the preceding 20%
increment. If any shares of Class B Common Stock are outstanding on the sixth
anniversary of this Prospectus, such shares will automatically convert into a
number of shares of Common Stock based upon the conversion ratio then applicable
for such

F-12
<PAGE>
AMERICAN MEDICAL PROVIDERS, INC.
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

shares. Thus, on such anniversary if a portion of the shares of Class B Common
Stock have become Adjusted Conversion Shares and a portion of the shares of
Class B Common Stock are not Adjusted Conversion Shares, those Adjusted
Conversion Shares shall be converted on a three-for-one basis and the
non-Adjusted Conversion Shares shall be converted on a one-for-one basis.

A Conversion Event shall be deemed to have occurred (i) in the event of a
disposition of such shares of Class B Common Stock by the holder thereof
(excluding dispositions to such holder's affiliates), (ii) in the event any
person not affiliated with the Company acquires beneficial ownership of 15% or
more of the outstanding shares of capital stock of the Company, (iii) in the
event any person not affiliated with the Company offers to acquire 15% or more
of the outstanding shares of capital stock of the Company, (iv) in the event the
holder of such shares elects to so convert at any time after the second
anniversary of the date of this Prospectus, (v) on the sixth anniversary of the
date of this Prospectus, or (vi) in the event the holders of a majority of the
outstanding shares of Common Stock approve such conversion. In addition, the
Company may elect to convert any outstanding shares of Class B stock into shares
of Common Stock in the event 95% or more of the outstanding shares of Class B
Common Stock as of the date of this Prospectus have previously been converted
into shares of Common Stock.

Upon consummation of the Offering, holders of the Class B Common Stock will
have the ability to elect as a class one member of the Board of Directors and
the holders of the Common Stock will have the ability to elect as a class all
other members of the Board of Directors, provided however that if 65% or more of
the Class B Common Stock outstanding on the date of this Prospectus have been
converted into Common Stock, the Class B Common Stock shall no longer have the
ability to elect a director as a class. The Common Stock and Class B Common
Stock possess ordinary voting rights and vote together as a single class in
respect of all other corporate matters, and, in connection therewith, holders of
shares of Common Stock are entitled to one vote per share and holders of shares
of Class B Common Stock are entitled to 2/3 of a vote per share. The Common
Stock and Class B Common Stock afford no cumulative voting rights, and the
holders of a majority of the shares voting for the election of directors can
elect all the directors if they choose to do so. Except for the conversion
rights of the Class B Common Stock described below, the Common Stock and Class B
Common Stock carry no preemptive rights and are not convertible, redeemable,
assessable or entitled to the benefits of any sinking fund. The holders of
Common Stock and Class B Common Stock are entitled to dividends in such amounts
and at such times as may be declared by the Board of Directors out of funds
legally available therefore.

The Board of Directors is authorized, without further action by the
stockholders, to provide for the issuance of shares of Preferred Stock as a
class without series or in one or more series, to establish the number of shares
in each class or series and to fix the designation, powers, preferences and
rights of each such class or series and the qualifications, limitations or
restrictions thereof. Because the Board of Directors has the power to establish
the preferences and rights of each class or series of Preferred Stock, the Board
of Directors may afford the holders of any class or series of Preferred Stock
preferences, powers and rights, voting or otherwise, senior to the rights of
holders of Common Stock or the Class B Common Stock. The issuance of Preferred
Stock could have the effect of delaying or preventing a change in control of the
Company. To date, the Company has not issued any Preferred Stock but the Board
has authorized the issuance of the Series A Junior Participating Preferred Stock
of the Company.

The Company has adopted the 1997 Incentive and Non-Qualified Stock Option
Plan (the "1997 Plan") to provide incentives to attract and retain directors,
officers, advisors, consultants and key employees. Officers, directors,
employees of the Company, consultants and advisors to the Company are eligible
to receive awards under the 1997 Plan, at the Plan Administrator's discretion.
Awards available under the 1997 Plan include: (i) common stock purchase options;
(ii) stock appreciation rights; (iii) restricted stock; (iv) deferred stock; (v)
performance shares and (vi) other stock based awards. The Company has reserved
up to 1,157,098 of the shares of its Common Stock for granting of options under
the

F-13
<PAGE>
AMERICAN MEDICAL PROVIDERS, INC.
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

1997 Plan. Under the terms of the 1997 Plan, the Plan Administrator retains
discretion, subject to plan limits, to modify the terms of outstanding awards
and to reprice awards. During the fourth quarter of 1997, options to purchase
334,500 shares of Common Stock were granted, and during the first quarter of
1998, options to purchase 94,000 shares of Common Stock were granted, all at
exercise prices equal to the initial public offering price with vesting over a
period of four years. The Company anticipates granting options to purchase
additional shares of Common Stock to employees of AMP and the Regional Group
Practices, prior to or contemporaneous with the closing of the Offering, at a
purchase price equal to the initial public offering price.

AFC has provided advances to AMP since inception, primarily representing
costs paid by AFC on behalf of AMP. The advances are non-interest bearing and
will be repaid with proceeds from the Offering. The initial $2.2 million in
advances were funded by AFC from the initial seed capital proceeds raised by
AFC. Interest expense of $289,759 during 1997 has been included in the
accompanying financial statements based upon an imputed interest rate of 18%. As
the advances are non-interest bearing, the imputed interest expense will not be
paid to AFC and, accordingly, has been reflected as a capital contribution
during the period incurred. The remaining advances in excess of the $2.2 million
have been funded by interest bearing borrowings of AFC and the related interest
charges associated with these borrowings have been accrued in the accompanying
financial statements as further discussed in Note 3.

5. TRANSACTIONS WITH AFFILIATED PRACTICES

As discussed in Note 1, the Company plans to complete the Transfers through
a series of stock and asset exchanges, the acquisition of certain monetary
assets and assumption of certain liabilities of the Affiliated Practices
concurrently with an initial public offering of shares of its Common Stock.

AGREEMENTS WITH AFFILIATED PRACTICES AND REGIONAL GROUP PRACTICES

The Company is party to management agreements with each Regional Group
Practice. The owners of the Affiliated Practices (promoters of the Company),
except Dr. Kramer, will enter into five-year DPM engagement agreements with the
Regional Group Practices. Additionally, the non-owner employee podiatrists at
the Affiliated Practices will enter into employment and noncompete agreements
with the Regional Group Practices.

MANAGEMENT AGREEMENTS

The following summary of the management agreements is a general summary of
the form of the management agreements. The Company expects to enter into similar
agreements with other affiliated practices. The terms of the individual
management agreements into which the Company may enter in the future may vary
from the description below as a result of negotiations with individual practices
and the requirements of local laws and regulations.

Pursuant to the management agreements, the Company, among other things,
will (a) act as the exclusive manager and administrator of non-physician
services related to the operation of the Regional Group Practices, subject to
matters for which the Regional Group Practices maintain responsibility or which
are referred to the board of managers of the Regional Group Practices, (b) bill
patients, insurance companies and other third-party payors and collect, on
behalf of the Regional Group Practices, the fees for professional medical and
other services rendered (as allowed by local regulations), including goods and
supplies sold by the Regional Group Practices, (c) provide or arrange for, as
necessary, clerical, accounting, purchasing, payroll, legal, bookkeeping and
computer services and personnel, information management, preparation of certain
tax returns, printing, postage and duplication services and medical transcribing
services, (d) supervise and maintain custody of substantially all files and
records (medical records of the Regional Group Practices remain the property of
the Regional Group Practices), (e) provide facilities for the Regional Group
Practices, (f) prepare, in consultation with the policy boards and the Regional
Group Practices, all

F-14
<PAGE>
AMERICAN MEDICAL PROVIDERS, INC.
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

annual and capital operating budgets, (g) order and purchase inventory and
supplies as reasonably requested by the Regional Group Practices, (h) implement,
in consultation with the policy boards and the Regional Group Practices,
national and local public relations or advertising programs, and (i) provide
financial and business assistance in the negotiation, establishment, supervision
and maintenance of contracts and relationships with managed-care and other
similar providers and payors. Most of the services described above are expected
to be provided by employees previously employed by the Affiliated Practices who
will become employees of the Company.

Under the management agreements, the Regional Group Practices will retain
the responsibility for, among other things, (a) hiring and compensating
physician employees and certain other medical professionals, (b) ensuring that
physicians have the required licenses, credentials, approvals and other
certifications needed to perform their duties and (c) complying with certain
federal and state laws and regulations applicable to the practice of podiatric
medicine and (d) matters involving its corporate governance, employees and
similar internal matters, including but not limited to preparation and the
contents of reports to regulatory authorities and distribution of professional
fee income. In addition, the Regional Group Practices will maintain exclusive
control of all aspects of the practice of medicine and the delivery of medical
services.

Under the management agreements, the Company will earn fees from the
Regional Group Practices on a monthly basis. The Company will be entitled to
retain a service fee equal to the Regional Group Practice expenses and ancillary
expenses plus approximately 9% to 25% of the Regional Group Practice adjusted
patient revenues, subject to quarterly adjustment to reflect the fair value of
the management services provided considering the nature and volume of services
required and risks assumed by the Company. Adjustments to reflect the fair value
of the management services may occur for a variety of reasons including
unexpected variations in revenues or expenses of the Regional Group Practice.
Any adjustments to the service fee percentage would be made on a prospective
basis. Accordingly, the Company will maintain a net revenue interest and not a
net profits interest. In addition, the Company will generally be entitled to a
fee of approximately 70% of the ancillary revenues, net of certain operating
expenses, of the Regional Group Practice.

The management agreements between the Company and the Regional Group
Practices will have initial terms of 40 years, with automatic extensions (unless
specified notice is given) of additional 10-year terms. The management
agreements may be terminated by either party if the other party (a) files a
petition in bankruptcy or other similar events occur or (b) defaults on the
performance of a material duty or obligation, which default continues for a
specified term after notice and, in the case of the Regional Group Practice, has
also been approved by 80% of the equity holders of the Regional Group Practice.
In addition, the Company may terminate the agreement if the Regional Group
Practice or any DPM (a) engages in conduct or is formally accused of conduct
that would subject his or her license to practice medicine to be revoked or (b)
is otherwise disciplined by any licensing, regulatory or professional entity or
institution, if the result of any event described in clause (a) or (b)
reasonably would be expected to materially adversely affect the group practice.

During the term of the management agreement and for a period of one year
thereafter, the Regional Group Practices agree not to compete with the Company
in providing services similar to those provided by the Company or by any
Regional Group Practice anywhere within 20 miles of any location at which any
DPM of the Regional Group Practice has practiced medicine in the last year. In
addition, the initial management agreement makes the Company a third-party
beneficiary of the physician engagement agreement including the noncompetition
and liquidated damages provisions therein. The management agreements generally
require the Regional Group Practices to pursue enforcement of these provisions
or to assign to the Company the right to pursue enforcement. Furthermore, the
Company may require the

F-15
<PAGE>
AMERICAN MEDICAL PROVIDERS, INC.
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

Regional Group Practice to pay liquidated damages owed by a departing DPM before
those damages are collected by the Regional Group Practice.

The Regional Group Practices will be responsible for obtaining professional
liability and workers' compensation insurance for the DPMs and other medical
employees of the Regional Group Practices, as well as general liability umbrella
coverage. The Company is responsible for obtaining professional liability and
workers' compensation insurance for employees of the Company and arranging for
general liability and property insurance for the Regional Group Practices.

The management agreements will contain indemnification provisions pursuant
to which the Company will indemnify the Regional Group Practices for damages
resulting from negligent acts or omissions by the Company or its agents,
employees or stockholders. In addition, the Regional Group Practices indemnify
the Company for any damages resulting from any negligent act or omission by any
affiliated DPM, agent or employee of the Regional Group Practices, other than
damages resulting from claims arising from the performance or nonperformance of
medical services.

PHYSICIAN ENGAGEMENT AGREEMENTS

In addition to becoming a member of a Regional Group Practice, each
affiliated DPM will enter into an engagement agreement with that Regional Group
Practice (the "Physician Engagement Agreement").

The Physician Engagement Agreements are for a period of five years with
successive two-year renewal periods thereafter. DPMs entering into Physician
Engagement Agreements agree to practice podiatric medicine on a full-time basis
for the Regional Group Practice in return for a percentage of the earnings
before taxes of and certain ancillary revenues related to that Regional Group
Practice. A Physician Engagement Agreement terminates (a) upon the death of the
DPM, (b) upon the DPM's "disability" or (c) at the Regional Group Practice's
option, for "cause," as defined in the Physician Engagement Agreement. If the
Physician Engagement Agreement terminates, other than at the normal expiration
of its term or as a result of a violation by the Regional Group Practice, the
DPM agrees to pay an amount of liquidated damages to the Regional Group Practice
approximately equal to the twelve months of the Affiliated Practice expenses
attributable to that DPM and agreed to by the Company at the time the Purchase
Agreement was executed. Furthermore, during the term of the Physician Engagement
Agreement and for a period of one year commencing upon expiration or termination
of the agreement, the DPM will not compete with the Regional Group Practice
within a radius of 20 miles of the offices at which that DPM practiced podiatry
in the last year.

The management fees earned by the Company will be in accordance with a
standard management agreement which calls for a calculation of the monthly
management fee based primarily on the total revenues earned by the Regional
Group Practices. There are adjustments to the management fees designed to both
provide incentives for the DPMs to provide efficient patient treatment and to
increase the number of patients treated, as well as to ensure that for the first
six months of the agreement the Regional Group Practice retains a minimum amount
for payment of compensation on a monthly basis. The Company believes the fees to
be generated by these formulas will be reflective of the fair market value of
the services provided and will be comparable to the fees earned by other
management companies in the respective jurisdictions where these arrangements
will exist.

6. SUBSEQUENT EVENTS

The Company has received from a major international financial institution a
commitment for a $30.0 million, three-year revolving credit facility that is
expected to be available to help fund the Company's working capital needs,
capital expenditures and anticipated future affiliations. The credit facility is
expected to contain customary affirmative and negative covenants (including
proscriptions on the payment of dividends and capital expenditures.) The credit
facility is expected to bear interest at either the London

F-16
<PAGE>
AMERICAN MEDICAL PROVIDERS, INC.
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

Inter-Bank Offered Rate or, at the Company's option, the lender's base rate,
plus a margin based on the ratio of the Company's senior debt to earnings before
interest, taxes, depreciation and amortization. There can be no assurance that
the Company will ultimately close on the credit facility.

As discussed in Note 1, pursuant to a reimbursement and assumption
agreement with AFC, the Company will reimburse the affiliation-related expenses
incurred by AFC since May 1996, including AFC's payroll, travel and
entertainment and professional fees. In addition, the Company will assume
certain lease obligations of AFC for office space, including the lease
obligations for additional office space entered into during 1998.

In order to complete the funding of the Company's development and
organization expenses through the closing of the Offering, members of the
Company's management and consultants made short-term loans to AFC in the
aggregate principal amount of $210,000. In addition, an institutional investor,
which had previously loaned AFC $500,000, has agreed to increase the amount of
its short-term loan to AFC by an additional $150,000. AFC will repay the
principal amount of these loans, and interest in the aggregate amount of
$141,125, to such persons with the portion of the funds from the Company's
Offering reimbursed to AFC for expenses, debt and interest incurred by AFC on
behalf of the Company.

In the first quarter of 1998, AMP intends to complete its initial public
offering of its Common Stock and intends to simultaneously exchange cash and
shares of its Common Stock for certain assets and liabilities of the founding
practices upon consummation of the Offering. An investment in shares of Common
Stock offered by this prospectus involves a high degree of risk, including,
among others, limited operating history of the Company and combined practices,
dependence on operative agreements, dependence on Regional Group Practices,
implementation of information systems, dependence upon key personnel, growth
strategy, managed care, future health care reform, competition and the need for
additional funds. For a more thorough discussion of risk factors, see "Risk
Factors" included elsewhere in this prospectus.

F-17

<PAGE>
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS

To Pyramid Anesthesiology Group, Inc.:

We have audited the accompanying balance sheets of Pyramid Anesthesiology
Group, Inc. (the "Company"), a Georgia S Corporation, as of December 31, 1996
and 1997, and the related statements of operations, stockholders' equity and
cash flows for the three years in the period ended December 31, 1997. These
financial statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.

In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of Pyramid Anesthesiology
Group, Inc., as of December 31, 1996 and 1997, and the results of its operations
and its cash flows for the three years in the period ended December 31, 1997, in
conformity with generally accepted accounting principles.

ARTHUR ANDERSEN LLP

Houston, Texas
February 27, 1998

F-18
<PAGE>
PYRAMID ANESTHESIOLOGY GROUP, INC.
BALANCE SHEETS

DECEMBER 31,
---------------------------
1996 1997
---------- --------------
ASSETS
CURRENT ASSETS:
Cash............................ $ 42,464 $ 59,620
Accounts receivable from
affiliates..................... 386,970 154,742
Other current assets............ 1,183 --
---------- --------------
Total current assets....... 430,617 214,362
---------- --------------
EQUIPMENT, at cost
Computers and equipment......... 132,029 152,242
Furniture and fixtures.......... 115,860 115,860
---------- --------------
247,889 268,102
Less-Accumulated depreciation... (86,775) (126,356)
---------- --------------
161,114 141,746
---------- --------------
OTHER ASSETS:
Investment...................... 7,200 --
---------- --------------
$ 598,931 $ 356,108
========== ==============
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable................ $ 20,904 $ 58,253
Due to affiliates............... 260,504 42,448
Accrued expenses................ 41,543 49,123
Note payable.................... -- 75,000
Note payable to related party... 74,776 59,642
---------- --------------
Total current
liabilities............. 397,727 284,466
---------- --------------
STOCKHOLDERS' EQUITY:
Common stock.................... 2,000 2,000
Retained earnings............... 199,204 69,642
---------- --------------
Total stockholders'
equity.................. 201,204 71,642
---------- --------------
$ 598,931 $ 356,108
========== ==============

The accompanying notes are an integral part of these financial statements.

F-19
<PAGE>
PYRAMID ANESTHESIOLOGY GROUP, INC.
STATEMENTS OF OPERATIONS

YEARS ENDED DECEMBER 31,
----------------------------------------
1995 1996 1997
------------ ------------ ------------
REVENUES............................. $ 1,009,017 $ 1,867,646 $ 2,226,009
OPERATING EXPENSES................... 495,960 763,825 1,011,384
------------ ------------ ------------
Income from operations..... 513,057 1,103,821 1,214,625
------------ ------------ ------------
OTHER INCOME:
Interest income................. 3,851 1,719 1,855
Gain on sale of investment to
affiliate..................... -- 196,875 --
Other........................... 16,558 11,203 60,353
------------ ------------ ------------
Total other income......... 20,409 209,797 62,208
------------ ------------ ------------
NET INCOME........................... $ 533,466 $ 1,313,618 $ 1,276,833
============ ============ ============
PRO FORMA DATA (unaudited):
Historical net income........... $ 533,466 $ 1,313,618 $ 1,276,833
Pro forma owners'
compensation.................. 300,000 300,000 200,000
Pro forma income taxes.......... 93,386 405,447 430,733
------------ ------------ ------------
Pro forma net income....... $ 140,080 $ 608,171 $ 646,100
============ ============ ============

The accompanying notes are an integral part of these financial statements.

F-20
<PAGE>
PYRAMID ANESTHESIOLOGY GROUP, INC.
STATEMENTS OF STOCKHOLDERS' EQUITY

<TABLE>
<CAPTION>
COMMON STOCK
------------------- RETAINED
SHARES AMOUNT EARNINGS TOTAL
------- ------- ----------- --------------
<S> <C> <C> <C> <C>
BALANCE, December 31, 1994........... 2,000 $ 2,000 $ 45,341 $ 47,341
Stockholder distributions....... -- -- (122,221) (122,221)
Net income...................... -- -- 533,466 533,466
------- ------- ----------- --------------
BALANCE, December 31, 1995........... 2,000 2,000 456,586 458,586
Stockholder distributions....... -- -- (1,571,000) (1,571,000)
Net income...................... -- -- 1,313,618 1,313,618
------- ------- ----------- --------------
BALANCE, December 31, 1996........... 2,000 2,000 199,204 201,204
Stockholder distributions....... -- -- (1,406,395) (1,406,395)
Net income...................... -- -- 1,276,833 1,276,833
------- ------- ----------- --------------
BALANCE, December 31, 1997........... 2,000 $ 2,000 $ 69,642 $ 71,642
======= ======= =========== ==============
</TABLE>

The accompanying notes are an integral part of these financial statements.

F-21
<PAGE>
PYRAMID ANESTHESIOLOGY GROUP, INC.
STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31,
--------------------------------------------
1995 1996 1997
------------ -------------- --------------
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income......................... $ 533,466 $ 1,313,618 $ 1,276,833
Adjustments to reconcile net income
to net cash provided by
operating activities --
Depreciation.................... 26,373 60,402 39,581
Gain on sale of investment...... -- (196,875) --
Changes in assets and
liabilities --
Accounts receivable from
affiliates................. 926,388 163,555 232,228
Other current assets.......... (950) 34,767 1,183
Accounts payable.............. (13,486) 7,178 37,349
Due to affiliates............. (1,186,590) 9,734 (218,056)
Accrued expenses.............. 15,122 26,421 7,580
------------ -------------- --------------
Net cash provided by operating
activities.................... 300,323 1,418,800 1,376,698
------------ -------------- --------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property and
equipment....................... (186,535) (61,354) (20,213)
Purchase of investment............. (18,000) -- --
Proceeds from sale of investment... -- 207,675 7,200
------------ -------------- --------------
Net cash provided by (used in)
investing activities.......... (204,535) 146,321 (13,013)
------------ -------------- --------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Distributions to shareholders...... (122,221) (1,571,000) (1,406,395)
Proceeds from note payable......... -- -- 75,000
Proceeds from (payments on) note
payable to related party........ 26,438 48,338 (15,134)
------------ -------------- --------------
Net cash used in financing
activities.................... (95,783) (1,522,662) (1,346,529)
------------ -------------- --------------
NET INCREASE IN CASH................. 5 42,459 17,156
CASH, beginning of period............ -- 5 42,464
------------ -------------- --------------
CASH, end of period.................. $ 5 $ 42,464 $ 59,620
============ ============== ==============
</TABLE>

The accompanying notes are an integral part of these financial statements.

F-22
<PAGE>
PYRAMID ANESTHESIOLOGY GROUP, INC.
NOTES TO FINANCIAL STATEMENTS

1. NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

ORGANIZATION

Pyramid Anesthesiology Group, Inc. (the "Company"), a Georgia S
Corporation, was incorporated on February 1, 1993, for the purpose of providing
billing and management services for entities that provide health-care related
services for local hospitals and to members of the community. The Company began
generating revenues from its primary operations in March 1995.

In October 1997, the Company entered into an agreement with American
Medical Providers, Inc. ("AMP"), pursuant to which AMP or a designated
subsidiary will acquire substantially all of the assets and operations of the
Company, including the name AnestheCare. The scope of the ongoing operations of
Pyramid will be significantly reduced as a result of the sale as AMP will assume
substantially all operations from Pyramid.

USE OF ESTIMATES

INVESTMENT

The Company maintained an ownership interest in a partnership through
October 1997 (see Note 2). Since the Company's ownership did not represent a
significant influence, the investment was accounted for under the cost method.

FAIR VALUE OF FINANCIAL INSTRUMENTS

The carrying value of cash, receivables, accounts payable and note payable
approximates fair value due to the short maturity of these instruments.

PROPERTY AND DEPRECIATION

Property and equipment are stated at cost. Depreciation is provided on the
straight-line method over the estimated useful lives of the respective assets.
Those lives are as follows:

Computers and equipment.............. 5 years
Furniture and fixtures............... 7 years

Maintenance and repairs are charged to expense as incurred whereas major
renewals and betterments are capitalized. When items of property or equipment
are sold or retired, the related cost and accumulated depreciation are removed
from the accounts and any gain or loss is included in income.

REVENUE RECOGNITION

The Company earns revenues under various cost-sharing agreements which are
based upon a percentage of revenues of the customer. Accordingly, the Company
recognizes revenues under the cost-sharing agreements based upon the accrual
basis revenues of the respective customer.

Additionally, the Company earns revenues from SCNA (as defined below) for
providing consulting services as the service is provided (see Note 2).

The Company also earns revenues through the provision of management and
billing services (see Note 2). The Company's management agreements primarily
provide that revenues are earned based upon a

F-23
<PAGE>
PYRAMID ANESTHESIOLOGY GROUP, INC.
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

percentage of cash collected by the respective business. Accordingly, the
Company recognizes management fee revenues as cash is collected by the customer.

INCOME TAXES

The Company, with the consent of its stockholders, has elected under the
Internal Revenue Code to be an S Corporation for tax purposes. In lieu of
corporate income taxes, the stockholders of an S Corporation are taxed on their
proportionate share of the Company's taxable income. Therefore, no provisions or
liability for income taxes has been included in the financial statements.

The Company's S-Corporation status will terminate effective with the
acquisition by AMP as further discussed above. The deferred tax asset estimated
upon conversion to C-Corporation status is expected to be approximately $40,000.
The unaudited pro forma data presents the incremental provision for income taxes
as if the Company had been subject to federal and state income taxes, assuming a
blended rate of 40%.

OWNERS' COMPENSATION

Effective July 1, 1997, the shareholders began to receive salaries of
$25,000 each per quarter. Prior to July 1, 1997, the stockholders had not
historically received a salary for their services, but received distributions as
S-Corporation stockholders. All earnings of the Company are available for
distribution to the stockholders. The pro forma owners' compensation reflects
the compensation the stockholders will receive prospectively under the terms of
the employment agreements with AMP as further discussed above.

SIGNIFICANT CONCENTRATIONS

Substantially all of the Company's revenue is from services performed
through affiliates of the Company (see Note 2). The Company's parent has signed
a professional services agreement with one hospital which was to expire
September 30, 1999, with continuing one-year renewal options thereafter.
Approximately 32% and 47% of the Company's revenues were from services
associated with this contract during the years ended December 31, 1995 and 1996,
respectively. Effective January 1, 1997, the Company restructured the
professional services agreement into several agreements with the affiliates. The
Company began processing the billing of patients directly at this time for
affiliates of the Company (as described in Note 2) and the revenues generated
associated with this contract were intermingled with the revenues from
affiliates of the Company.

2. RELATED-PARTY TRANSACTIONS

The Company provides services to a group of affiliated companies (the
"Affiliates"). The Affiliates with some common owners are Georgia
Rehabilitation Center ("GRC"), Southern Crescent Nurse Anesthesia, LLC,
("SCNA") and Cell Saver, Inc. Southern Crescent Anesthesiology, Inc.
("SCA"), is also an affiliate but is not under common control. Substantially
all of the revenues of the Company are earned in transactions with entities
which are currently related parties but which will not be owned by AMP
subsequent to the acquisition by AMP.

The Company earns 7 to 10 percent of all revenues collected on behalf of
the Affiliates. In addition, revenues from services provided to three hospitals
are earned through affiliates of the Company, primarily through a professional
services agreement between the parent company, AnestheCare, Inc. (the
"Parent"), and one hospital. Accounts receivable from these affiliated
entities as of December 31, 1996 and 1997, were $386,970, and $154,742,
respectively. Revenues from these affiliated entities for the years ended
December 31, 1995, 1996 and 1997, under these collections agreements were
$1,006,035, $1,632,125, and $681,060, respectively. Based upon contractual
arrangements between the Company and the Affiliates through December 31, 1996,
certain general and administrative costs which benefit all the entities were
shared amongst all entities. The contractual arrangements provided that these
indentified costs, primarily payroll costs of certain personnel, would be
allocated evenly among Pyramid, GRC, SCNA and SCA. Expenses

F-24
<PAGE>
PYRAMID ANESTHESIOLOGY GROUP, INC.
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

allocated to the Affiliates for the years ended December 31, 1995 and 1996, were
$57,500 and $230,728, respectively. As of December 31, 1996, one of the
Affiliates had prepaid $17,166 of these expenses, which is included in due to
affiliates in the accompanying financial statements. Management believes that
the methods used to allocate these expenses are reasonable. Effective January 1,
1997, the cost-sharing agreements with Affiliates were restructured and the
Company now earns 6 to 12 percent of revenues of the Affiliates as a charge for
general and administrative costs incurred by the Company. Revenues earned under
this cost-sharing agreement were $1,155,554 for the year ended December 31,
1997.

In January of 1996, the Company sold 60% of its interest in Peachtree
Lithotripsy to an affiliate, SCA, for approximately $208,000 resulting in a gain
on the sale of approximately $197,000. During October 1997, the Company sold the
remaining interest in this investment to the stockholders at cost. The income
from these operations were insignificant for all periods presented.

During 1997, two owners of the Company, who were previously member owners
in SCNA, withdrew their membership from SCNA. Additionally, the Company entered
into an agreement whereby it would act as a consultant on behalf of SCNA.
Included in 1997 revenues are $322,075 of consulting revenues related to these
agreements. Effective January 1 through June 30, 1997, the terms of this
agreement specified that the consulting fee would be $25,000 per month, plus 15%
of SCNA's taxable income, as defined.

3. NOTE PAYABLE

The Company entered into a note agreement for $75,000 with a local bank on
December 12, 1997. The note, which matures December 12, 1998, bears a variable
interest rate (9.25% at December 31, 1997) and is collateralized by
substantially all assets of the Company.

4. COMMITMENTS AND CONTINGENCIES

The Company rents office space from one of the Affiliates for $5,166 per
month through August 2005. Rent expense for 1996 and 1997 was $61,992. The
Company additionally leases a light truck and an office copier.

Future minimum payments under these leases are as follows:

Year ending December 31 --
1998............................ $ 75,210
1999............................ 74,961
2000............................ 71,600
2001............................ 68,481
2002............................ 62,633
Thereafter...................... 160,146
----------
$ 513,031
==========

The Company has a defined contribution 401(k) plan which was effective
beginning in 1996. Eligible employees can contribute up to 15 percent of their
compensation, and the Company may make a discretionary matching contribution.
For 1996, the Company contributed $8,625. No matching contributions have been
approved for 1997.

F-25
<PAGE>
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS

To the Board of Directors of
Bellaire Surgicare, Inc.

We have audited the accompanying balance sheets of Bellaire Surgicare,
Inc., as of December 31, 1996 and 1997, and the related statements of
operations, shareholders' equity and cash flows for the period from the date of
inception (March 15, 1995) to December 31, 1995, and for the two years in the
period ended December 31, 1997. These financial statements are the
responsibility of Bellaire Surgicare, Inc.'s management. Our responsibility is
to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audits to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of Bellaire Surgicare, Inc., as
of December 31, 1996 and 1997, and the results of its operations and its cash
flows for the period from the date of inception (March 15, 1995) to December 31,
1995, and for the two years in the period ended December 31, 1997, in conformity
with generally accepted accounting principles.

ARTHUR ANDERSEN LLP

Houston, Texas
March 6, 1998

F-26
<PAGE>
BELLAIRE SURGICARE, INC.
BALANCE SHEETS

DECEMBER 31,
--------------------------
1996 1997
------------ ------------
ASSETS
CURRENT ASSETS:
Cash and cash equivalents.......... $ 130,001 $ 108,142
Accounts receivable, net of
allowance for contractual
adjustments and bad debts of
$466,415 and $439,843........... 394,670 520,696
Due from related parties........... 28,000 20,500
Prepaid expenses and other current
assets.......................... 80,889 79,054
------------ ------------
Total current assets....... 633,560 728,392
PROPERTY AND EQUIPMENT, net.......... 445,574 325,173
OTHER NONCURRENT ASSETS, net......... 3,750 --
------------ ------------
Total assets............... $ 1,082,884 $ 1,053,565
============ ============
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Current portion of long-term
debt............................... $ 597,216 $ 560,814
Current portion of obligations
under capital leases............ 25,014 11,690
Accounts payable and accrued
expenses........................ 142,255 183,132
Due to related parties............. 12,119 9,190
------------ ------------
Total current
liabilities.................. 776,604 764,826
LONG-TERM DEBT, net of current
portion............................ 26,653 --
LONG-TERM OBLIGATIONS UNDER CAPITAL
LEASES, net of current portion..... 26,170 11,309
------------ ------------
Total liabilities.......... 829,427 776,135
SHAREHOLDERS' EQUITY:
Common stock, $.10 par value;
1,000,000 shares authorized and
140,000 shares issued and
outstanding..................... 14,000 14,000
Retained earnings.................. 239,457 263,430
------------ ------------
Total shareholders'
equity................. 253,457 277,430
------------ ------------
Total liabilities and
shareholders' equity... $ 1,082,884 $ 1,053,565
============ ============

The accompanying notes are an integral part of these financial statements.

F-27
<PAGE>

BELLAIRE SURGICARE, INC.
STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
PERIOD
FROM INCEPTION
(MARCH 15,
1995) TO YEAR ENDED YEAR ENDED
DECEMBER 31, DECEMBER 31, DECEMBER 31,
1995 1996 1997
--------------- ------------- -------------
<S> <C> <C> <C>
REVENUES............................. $ 1,922,496 $ 2,486,220 $ 2,395,758
COSTS AND EXPENSES:
Surgical costs..................... 404,481 444,939 504,002
Salaries, wages and benefits....... 232,989 359,325 397,139
Management and professional fees... 242,030 340,064 347,377
General and administrative
expenses........................ 298,392 392,125 415,544
Depreciation and amortization...... 89,287 143,677 141,392
Interest expense................... 49,831 68,011 57,265
--------------- ------------- -------------
Total costs and expenses...... 1,317,010 1,748,141 1,862,719
--------------- ------------- -------------
Income from operations............. 605,486 738,079 533,039
OTHER INCOME......................... -- 2,392 1,574
--------------- ------------- -------------
NET EARNINGS......................... $ 605,486 $ 740,471 $ 534,613
=============== ============= =============
</TABLE>

The accompanying notes are an integral part of these financial statements.

F-28
<PAGE>
BELLAIRE SURGICARE, INC.
STATEMENTS OF SHAREHOLDERS' EQUITY

COMMON STOCK
------------------- RETAINED
SHARES AMOUNT EARNINGS
--------- ------- ---------
INITIAL CAPITALIZATION, March 15,
1995.................................. 140,000 $14,000 $ --
Net earnings....................... -- -- 605,486
Dividends to shareholders.......... -- -- (329,000)
--------- ------- ---------
BALANCE, December 31, 1995.............. 140,000 14,000 276,486
Net earnings....................... -- -- 740,471
Dividends to shareholders.......... -- -- (777,500)
--------- ------- ---------
BALANCE, December 31, 1996.............. 140,000 14,000 239,457
Net earnings....................... -- -- 534,613
Dividends to shareholders.......... -- -- (510,640)
--------- ------- ---------
BALANCE, December 31, 1997.............. 140,000 $14,000 $ 263,430
========= ======= =========

The accompanying notes are an integral part of these financial statements.

F-29
<PAGE>
BELLAIRE SURGICARE, INC.
STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
PERIOD FROM
INCEPTION
(MARCH 15,
1995) TO YEAR ENDED YEAR ENDED
DECEMBER 31, DECEMBER 31, DECEMBER 31,
1995 1996 1997
------------ ------------ ------------
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net earnings....................... $ 605,486 $ 740,471 $ 534,613
------------ ------------ ------------
Adjustments to reconcile net
earnings to net cash provided by
operating activities --
Depreciation and amortization... 89,287 143,677 141,232
Changes in assets and
liabilities --
(Increase) decrease in --
Accounts receivable, net... (559,326) 163,938 (126,026)
Due from related parties... -- (28,000) 7,500
Prepaid expenses and other
current assets.......... (64,081) (16,090) 1,835
Increase (decrease) in --
Accounts payable and
accrued expenses........ 133,539 8,716 27,547
Due to related parties..... -- 12,119 10,401
------------ ------------ ------------
(400,581) 284,360 62,489
------------ ------------ ------------
Net cash provided by
operating activities.... 204,905 1,024,831 597,102
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of non-compete
agreement....................... (30,000) -- --
Purchase of property and
equipment....................... (482,532) (82,161) (17,081)
------------ ------------ ------------
Net cash used in investing
activities.............. (512,532) (82,161) (17,081)
------------ ------------ ------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of common
stock........................... 14,000 -- --
Proceeds from long-term
obligations..................... 738,543 566,731 98,000
Payment of long-term obligations... (57,044) (624,361) (161,055)
Payment of obligations under
capital leases.................. (13,671) (22,740) (28,185)
Dividends to shareholders.......... (329,000) (777,500) (510,640)
------------ ------------ ------------
Net cash provided by (used
in) financing
activities.............. 352,828 (857,870) (601,880)
------------ ------------ ------------
NET INCREASE IN CASH AND CASH
EQUIVALENTS........................ 45,201 84,800 (21,859)
CASH AND CASH EQUIVALENTS, beginning
of period.......................... 0 45,201 130,001
------------ ------------ ------------
CASH AND CASH EQUIVALENTS, end of
period............................. $ 45,201 $ 130,001 $ 108,142
============ ============ ============
SUPPLEMENTAL DISCLOSURE OF NONCASH
INVESTMENT ACTIVITIES:
Capital lease obligations incurred
to acquire equipment............ $ 87,595 $ -- $ --
============ ============ ============
</TABLE>

The accompanying notes are an integral part of these financial statements.

F-30
<PAGE>
BELLAIRE SURGICARE, INC.
NOTES TO FINANCIAL STATEMENTS

1. BUSINESS, ORGANIZATION AND BASIS OF PRESENTATION:

Bellaire Surgicare, Inc. (the Center), is a free-standing ambulatory
surgery center which services Houston, Texas, and its surrounding communities.
The Center is organized as an S Corporation under the laws of the state of
Texas.

The Center's financial statements have been prepared on the accrual basis
of accounting. As the Center is organized as an S Corporation for federal income
tax reporting purposes, all tax liability is reported on the personal returns of
the shareholders. Upon acquisition by AMP as further discussed in Note 7, the
Company will record a deferred tax liability of approximately $125,000
representing the tax effect of differences between the book and tax bases of
assets and liabilities existing as of the acquisition date.

A majority of owners of the Center are doctors of podiatric medicine
(DPMs). Eight of these owner DPMs have agreed to acquire the remaining minority
interests, and will then transfer their respective interests in the Center along
with other non-monetary assets of their practice to American Medical Providers,
Inc. (AMP) in exchange for stock of AMP and cash. The Center is expected to
continue similar operations under the AMP ownership.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:

FAIR VALUE OF FINANCIAL INSTRUMENTS

The Center believes that the fair value of their financial instruments
approximates their carrying amounts. Financial instruments include cash and cash
equivalents, accounts receivable and certain current and long-term debt.

CASH AND CASH EQUIVALENTS

The Center considers all highly liquid investments with a maturity of three
months or less when purchased to be cash equivalents.

ACCOUNTS RECEIVABLE

Accounts receivable primarily consist of receivables from patients,
insurers, government programs and other third-party payors for medical services
provided by the Center. Such amounts are reduced by an allowance for contractual
adjustments and other uncollectible amounts. Contractual adjustments result from
the differences between the rates charged by the Center for services performed
and the amounts allowed by the Medicare and Medicaid programs and other
govenmental and private insurers.

PROPERTY AND EQUIPMENT

Property and equipment are stated at cost. Equipment under capital leases
is stated at the net present value of the future minimum lease payments at the
inception of the related leases. Depreciation of property and equipment is
calculated using the straight-line method over the estimated useful lives of the
assets. Routine maintenance and repairs are charged to expense as incurred,
while costs of betterments and renewals are capitalized.

OTHER NONCURRENT ASSETS

Other noncurrent assets consist of a noncompete agreement. The noncompete
agreement was amortized on the straight-line basis over two years, which was the
term of the agreement.

REVENUES

Medical service revenues are accounted for in the period the services are
provided. The revenues are reported at the estimated realizable amounts from
patients, third-party payors and others. Provisions for estimated third-party
payor adjustments are estimated in the period the related services are provided.
Any adjustment to the amounts recorded will be recorded in the period in which
the revised amount is

F-31
<PAGE>
BELLAIRE SURGICARE, INC.
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

determined. Medicare and other governmental programs reimburse based on fee
schedules which are determined by the related governmental agency. Additionally,
the Center participates in agreements with managed-care organizations to provide
services at negotiated rates or for capitated payments. Any differences between
estimated contractual adjustments and actual final settlements under
reimbursement contracts are recognized when the final settlements are made.

CONCENTRATION OF CREDIT RISK

The Center extends credit to patients covered by insurance programs such as
governmental programs like Medicare and Medicaid and private insurers. The
Center manages credit risk with the various public and private insurance
providers, as appropriate. Allowances for doubtful accounts have been made for
potential losses, where appropriate.

USE OF ESTIMATES

The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.

3. PROPERTY AND EQUIPMENT

Property and equipment at December 31, 1996, and 1997, consist of the
following:

ESTIMATED DECEMBER 31,
USEFUL LIVES ----------------------
(YEARS) 1996 1997
------------ ---------- ----------
Equipment............................... 5 $ 538,521 $ 555,602
Leasehold improvements.................. 5 4,512 4,512
Furniture and fixtures.................. 7 21,660 21,660
Equipment under capital leases.......... 3-5 87,595 87,595
---------- ----------
652,288 669,369
Less -- Accumulated depreciation........ (206,714) (344,196)
---------- ----------
Net property and equipment......... $ 445,574 $ 325,173
========== ==========

4. OTHER NONCURRENT ASSETS:

Other noncurrent assets at December 31, 1996 and 1997, consist of the
following:

DECEMBER 31,
--------------------
1996 1997
--------- ---------
Noncompete agreements................... $ 30,000 $ 30,000
Less -- Accumulated amortization... (26,250) (30,000)
--------- ---------
$ 3,750 $ --
========= =========

F-32
<PAGE>
BELLAIRE SURGICARE, INC.
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

5. LONG-TERM OBLIGATIONS

LONG-TERM DEBT

Long-term debt at December 31, 1996 and 1997, consists of the following:

DECEMBER 31,
----------------------
1996 1997
---------- ----------
Note payable to Southwest Bank of Texas,
bearing interest at prime,
collateralized by accounts receivable,
equipment and inventory............... $ 566,731 $ 537,063
Notes payable to Alcon Surgical, bearing
interest at 8%, collateralized by
equipment............................. 57,138 23,751
---------- ----------
Total long-term debt............... 623,869 560,814
Less -- Current portion................. (597,216) (560,814)
---------- ----------
Long-term debt, excluding current
portion.......................... $ 26,653 $ --
========== ==========

The Center leases certain equipment under capital leases. Additionally, the
Center has certain commitments under noncancelable operating lease agreements.
At December 31, 1997, minimum annual rental comitments under capital leases and
noncancelable operating leases with terms in excess of one year are as follows:

CAPITAL OPERATING
LEASES LEASES
--------- ---------
1998................................. $ 15,000 $ 168,000
1999................................. 8,000 168,000
2000................................. 7,000 168,000
2001................................. -- 168,000
2002................................. -- 55,000
--------- ---------
Total minimum lease
payments................... 30,000 $ 727,000
=========
Less -- Amounts representing
interest............................. 7,001
---------
Present value of minimum capital
lease payments................ 22,999
Less -- Current portion of
obligations under capital leases... 11,690
---------
Long-term obligations under
capital leases, net of current
portion....................... $ 11,309
=========

Rent expense related to operating leases amounted to approximately $58,000,
$140,000 and $168,000 for 1995, 1996 and 1997, respectively. Cash interest paid
related to all obligations was approximately $50,000, $68,000 and $57,000 in
1995, 1996 and 1997, respectively.

6. COMMITMENTS AND CONTINGENCIES:

The Center is insured with respect to medical malpractice risks on a
claims-made basis. In the normal course of business, the Center has been named
in various lawsuits, primarily alleging medical malpractice. In the opinion of
the Center's management, the ultimate liability, if any, will not exceed the
insurance coverages carried by the Center and will not impact the operating
results or results of financial condition of the Center.

Surgery Centers of America (SCOA) provides management services for the
Center under a management contract expiring January 12, 2000. Fees under the
contract are based on 5 percent of accrual basis revenues plus 10 percent of any
distributions. Additionally, the Center reimburses SCOA for the salary paid to a
SCOA employee who acts as an office administrator of the Center. Expenses under
this arrangement totaled $200,623, $272,091 and $215,874 for 1995, 1996 and
1997, respectively.

F-33
<PAGE>
AMERICAN MEDICAL PROVIDERS, INC.
INTRODUCTION TO UNAUDITED PRO FORMA COMBINED BALANCE SHEET

Simultaneously with and as a condition to the closing of the initial public
offering (the "Offering"), American Medical Providers, Inc. (the "Company"
or "AMP") will acquire certain operating assets and accounts receivable or
stock of 46 separate podiatric practices (these practices, including the
practice acquired in the Kramer Transfer (defined below), the "Affiliated
Practices") (the "Transfers") in exchange for cash, shares of class A common
stock, $.01 par value per share (the "Common Stock") and the assumption of
certain indebtedness. The aggregate consideration to be paid by the Company to
the initial Affiliated Practices is approximately $27.5 million, excluding the
Ambulatory Surgery Center Acquisitions (defined below) and the Kramer Transfer
which will be accounted for as purchases. AMP will also acquire through a
transaction to be accounted for as a purchase, certain assets of Pyramid
Anesthesiology Group, Inc. (the "AnestheCare Acquisition"), an anesthesiology
management services organization ("AnestheCare") for consideration of
approximately $4.5 million in cash. Additional consideration of up to $1.5
million in cash and $500,000 payable in shares of Common Stock at the initial
public offering price may be paid in the AnestheCare Acquisition pending
AnestheCare's achievement of certain performance targets over a three-year
period beginning January 1, 1998. In addition, AMP will acquire the stock of the
podiatric practice of Dr. Jerald N. Kramer ("Dr. Kramer"), one of the
affiliated practices (the "Kramer Transfer", and together with the Transfers
and the AnestheCare Acquisition, "the Transactions"). Dr. Kramer will receive
cash of $1.4 million in exchange for assets acquired by the Company, but Dr.
Kramer will not enter into a management services agreement or a physician
engagement agreement with a Regional Group Practice. The Company will also
acquire two surgery centers through the transfers (collectively the "Ambulatory
Surgery Center Acquisitions") for consideration of $5.1 million in cash and
Common Stock plus assumed indebtedness of $500,000. The Transfers, except for
the Ambulatory Surgery Center Acquisitions and the Kramer Transfer, will be
accounted for pursuant to Staff Accounting Bulletin No. 48, "Transfers of
Non-monetary Assets by Promoters and Shareholders" ("SAB No. 48"). As a
result, these transactions will result in the carryover basis of non-monetary
assets of the Affiliated Practices. Each owner doctor of podiatry medicine
("DPM") of the Affiliated Practices and AnestheCare is considered a
"promoter" of the Company.

The following unaudited pro forma combined balance sheet gives effect to
the Transactions and the Offering, and is based upon the historical financial
statements of AMP, the Affiliated Practices as a group, and AnestheCare.

The unaudited pro forma combined balance sheet gives effect as if such
events had occurred on December 31, 1997. The financial data related to the
Combined Affiliated Practices is as of September 30, 1997. Management believes
that these balances will not differ materially from the balances as of December
31, 1997 or the date of acquisition. The unaudited pro forma combined balance
sheet should be read in conjunction with other financial information, including
the financial statements of AMP included elsewhere in this Prospectus. The
unaudited pro forma combined balance sheet does not give effect to the Practice
Rescission Offer or the Bridge Financing Rescission Offer discussed further in
Note 5 to the financial statements of AMP.

The Company will not employ podiatrists or control the practice of
podiatry. As the Company will not be acquiring the future patient revenues
earned by the Affiliated Practices, the Transfers are not deemed to be business
combinations. In accordance with SAB No. 48, the Transfers will be accounted for
at the historical cost basis with the shares of common stock to be issued in
those transactions being valued at the historical cost of the net non-monetary
assets acquired.

The unaudited pro forma combined balance sheet is presented for
illustrative purposes only and is not necessarily indicative of the financial
position that would have been achieved if the Transactions and Offering had been
consummated on the date indicated, nor is it necessarily indicative of the
future operating results of the Company. The pro forma adjustments are based
upon estimates, available information and certain assumptions and may be revised
as additional information becomes available. Any variance between the estimated
offering price and actual offering price will directly impact the net proceeds
from the Offering. The preliminary allocations of the purchase prices are not
expected to materially differ from the final results.

F-34
<PAGE>

AMERICAN MEDICAL PROVIDERS, INC.
UNAUDITED PRO FORMA COMBINED BALANCE SHEET
DECEMBER 31, 1997
(IN THOUSANDS)
<TABLE>
<CAPTION>
AMERICAN COMBINED BELLAIRE PRO
MEDICAL AFFILIATED SURGICARE, PRO FORMA FORMA
PROVIDERS, INC. PRACTICES ANESTHECARE INC. ADJUSTMENTS COMBINED
--------------- -------- ----------- ---------- ----------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
ASSETS
CURRENT ASSETS:
Cash and cash equivalents............ $-- $ 952 $ 60 $ 108 $ (881)(1) $ 60
(179)(3)
Patient receivables, net............. -- 3,840 -- 521 -- 4,361
Affiliate receivables................ -- -- 154 -- -- 154
Deferred issuance costs.............. 3,673 -- -- -- -- 3,673
Other current assets................. 14 221 -- 99 (131)(1) 203
--------------- -------- --- ---------- ----------- --------
Total current assets............. 3,687 5,013 214 728 (1,191) 8,451
Equipment, net....................... 507 802 142 325 500(3) 2,276
Other assets......................... -- 389 -- -- (389)(1) --
Goodwill and Intangibles............. -- -- -- -- 2,944(2) 8,746
651(3)
1,200(2)
3,824(5)
127(6)
Restricted cash held in escrow....... -- -- -- -- -- --
--------------- -------- --- ---------- ----------- --------
Total assets..................... $ 4,194 $ 6,204 $ 356 $1,053 $ 7,666 $19,473
=============== ======== === ========== =========== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
(DEFICIT)
CURRENT LIABILITIES:
Accounts payable and other current
liabilities........................ $ 2,762 $ 1,163 $ 284 $ 192 $ (1,350)(1) $ 2,762
(284)(2)
(5)(3)
Due to stockholder................... 4,043 -- -- -- -- 4,043
Payable to Affiliated Practices...... -- -- -- -- 8,989(1) 8,989
Payable to AnestheCare............... -- -- -- -- 4,500(2) 4,500
Payable to Kramer.................... -- -- -- -- 1,400(3) 1,400
Payable for Ambulatory Surgery Center
Acquisitions....................... -- -- -- -- 1,000(1) 1,000
Deferred income taxes................ -- -- -- -- 966(4) 966
Current portion of long-term debt.... -- 707 -- 573 (624)(1) 656
--------------- -------- --- ---------- ----------- --------
Total current liabilities........ 6,805 1,870 284 765 14,592 24,316
--------------- -------- --- ---------- ----------- --------
Long-term debt, less current
portion............................ -- 680 -- 11 (691)(1) --
--------------- -------- --- ---------- ----------- --------
Total liabilities................ 6,805 2,550 284 776 13,901 24,316
--------------- -------- --- ---------- ----------- --------
STOCKHOLDERS' EQUITY (DEFICIT):
American Medical Providers, Inc.
Class A Common Stock............. -- -- -- -- 2(1) 2
Class B Common Stock............. 1 -- -- -- -- 1
Accumulated deficit.............. (4,143) -- -- -- -- (4,143)
Additional paid-in capital....... 1,531 -- -- -- (5,044)(1) (703)
(175)(3)
(966)(4)
3,824(5)
127(6)
AnestheCare
Common Stock..................... -- -- 2 -- (2)(2) --
Retained earnings................ -- -- 70 -- (70)(2) --
Affiliated Practices' combined
equity............................. -- 3,654 -- 277 (3,683)(1) --
(248)(3)
--------------- -------- --- ---------- ----------- --------
Total stockholders' equity
(deficit)...................... (2,611) 3,654 72 277 (6,235) (4,843)
--------------- -------- --- ---------- ----------- --------
Total liablities and
stockholders' equity........... $ 4,194 $ 6,204 $ 356 $1,053 $ 7,666 $19,473
=============== ======== === ========== =========== ========
</TABLE>
POST
OFFERING PRO FORMA
ADJUSTMENTS AS ADJUSTED
----------- -----------
ASSETS
CURRENT ASSETS:
Cash and cash equivalents............ 12,830(7) $12,890

Patient receivables, net............. -- 4,361
Affiliate receivables................ -- 154
Deferred issuance costs.............. (3,673)(7) --
Other current assets................. -- 203
----------- -----------
Total current assets............. 9,157 17,608
Equipment, net....................... -- 2,276
Other assets......................... -- --
Goodwill and Intangibles............. -- 8,746

Restricted cash held in escrow....... 1,500(7) 1,500
----------- -----------
Total assets..................... $10,657 $30,130
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
(DEFICIT)
CURRENT LIABILITIES:
Accounts payable and other current
liabilities........................ (2,762)(7) $--

Due to stockholder................... (4,043)(7) --
Payable to Affiliated Practices...... (8,989)(7) --
Payable to AnestheCare............... (4,500)(7) --
Payable to Kramer.................... (1,400)(7) --
Payable for Ambulatory Surgery Center
Acquisitions....................... (1,000)(7) --
Deferred income taxes................ -- 966
Current portion of long-term debt.... -- 656
----------- -----------
Total current liabilities........ (22,694) 1,622
----------- -----------
Long-term debt, less current
portion............................ -- --
----------- -----------
Total liabilities................ (22,694) 1,622
----------- -----------
STOCKHOLDERS' EQUITY (DEFICIT):
American Medical Providers, Inc.
Class A Common Stock............. 4(7) 6
Class B Common Stock............. -- 1
Accumulated deficit.............. -- (4,143)
Additional paid-in capital....... 33,347(7) 32,644

AnestheCare
Common Stock..................... -- --
Retained earnings................ -- --
Affiliated Practices' combined
equity............................. -- --

----------- -----------
Total stockholders' equity
(deficit)...................... 33,351 28,508
----------- -----------
Total liablities and
stockholders' equity........... $10,657 $30,130
=========== ===========

The accompanying notes to the unaudited pro forma combined balance sheet
are an integral part of this financial statement.

F-35
<PAGE>
AMERICAN MEDICAL PROVIDERS, INC.
NOTES TO UNAUDITED PRO FORMA COMBINED BALANCE SHEET

The following is a summary of the adjustments reflected in the unaudited
combined pro forma balance sheet:

(1) Reflects the issuance of 2,032,867 shares of Common Stock of the
Company and cash of approximately $10.1 million in exchange for
certain operating assets and accounts receivable or stock and
assumption of certain liabilities of the Affiliated Practices and the
Ambulatory Surgery Centers. Assets not acquired include cash,
receivables, prepaid assets, and other non current assets. Liabilities
not assumed include accounts payable, accrued liabilities, and a
portion of long-term debt. The Affiliated Practices and the Ambulatory
Surgery Centers will receive up to twenty five percent of the
consideration in cash and the remainder in Common Stock.

(2) Reflects the AnestheCare Acquisition for a cash purchase price of $4.5
million. Additional consideration of up to $1.5 million in cash and
$500,000 payable in shares of Common Stock valued at the initial
public offering price will be held in escrow and may be paid to the
owners of AnestheCare pending AnestheCare's achievement of certain
performance targets over a three-year period beginning January 1,
1998. All assets of AnestheCare have been acquired and the owners
assumed the liabilities, thus eliminating any liabilities acquired.
The goodwill of $2.9 million will be amortized on a straight line
basis over the estimated life of 25 years. The other intangible assets
relate to customer contracts for which purchase price will be
allocated and amortized on a straight line basis over their estimated
lives ranging from 10 to 15 years.

(3) Reflects the issuance of cash in exchange for stock and property in
the Kramer Transfer. The goodwill of $651,000 will be amortized on a
straight line basis over the estimated life of 25 years.

(4) Reflects the deferred income tax liability attributable to the
temporary differences between financial reporting and income tax bases
of assets and liabilities currently being acquired by AMP through the
Transactions.

(5) Reflects the step-up in the historical basis of Bellaire Surgicare,
Inc. ("Bellaire") which will be acquired by the Company in the
Transfers, but will be accounted for as a purchase business
combination in accordance with APB No. 16. The goodwill of $3.8
million will be amortized on a straight line basis over the estimated
life of 25 years.

(6) Reflects the step-up in the historical basis of the surgical care
center of Dr. Kalish which will be acquired by the Company in the
Transfers, but will be accounted for as a purchase business
combination in accordance with APB No. 16.

(CONTINUED ON FOLLOWING PAGE)

F-36
<PAGE>
AMERICAN MEDICAL PROVIDERS, INC.
NOTES TO UNAUDITED PRO FORMA COMBINED BALANCE SHEET -- (CONTINUED)

(7) Reflects the issuance of 3,700,000 shares of common stock of the
Company assuming an initial public offering price of $11.00 per share
and the application of proceeds as follows (in 000's)

Gross offering proceeds.............. $ 40,700
Underwriting discount................ (2,849)
Offering costs(*).................... (827)
Cash portion of the transactions..... (15,889)
Funds placed in escrow............... (1,500)
Due to stockholder................... (4,043)
Payment of accounts payable and other
current liabilities................ (2,762)
----------
Pro forma cash adjustment as of
December 31, 1997.................. $ 12,830
==========

- ------------

(*) This amount represents the portion of the total estimated
offering costs of $4,500,000 which is expected to be incurred
subsequent to December 31, 1997, consisting principally of
professional fees associated with the Offering.

Subsequent to December 31, 1997, until the anticipated closing of this
Offering, the Company estimates that it will have incurred
approximately $800,000 in period costs and capital expenditures
(principally salaries, general office expenses and equipment
purchases) paid by AFC on behalf of the Company, as well as
approximately $1.2 million in interest expense associated with certain
AFC bridge financing transactions. These amounts as well as the
approximate $4.0 million reflected on the historical balance sheet as
due to stockholder will be repaid to AFC out of the proceeds of the
Offering. Additionally, the Company anticipates using approximately
$1.0 million of the proceeds from the Offering to complete the
purchase and installation of the Company's management information
systems. These future expenditures are not reflected in the
accompanying unaudited pro forma combined balance sheet.

F-37
<PAGE>

[PHOTOGRAPHIC SPREAD OF VARIOUS SERVICES PROVIDED BY THE COMPANY]

<PAGE>
NO DEALER, SALESPERSON OR ANY OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS
PROSPECTUS IN CONNECTION WITH THE OFFERING MADE BY THIS PROSPECTUS AND, IF GIVEN
OR MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING
BEEN AUTHORIZED BY THE COMPANY OR ANY UNDERWRITER. THIS PROSPECTUS DOES NOT
CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF ANY OFFER TO BUY ANY SECURITY
OTHER THAN THE SHARES OF COMMON STOCK OFFERED BY THIS PROSPECTUS, NOR DOES IT
CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY THE SHARES OF
COMMON STOCK BY ANYONE IN ANY JURISDICTION IN WHICH SUCH AN OFFER OR
SOLICITATION IS NOT AUTHORIZED, OR IN WHICH THE PERSON MAKING SUCH OFFER OR
SOLICITATION IS NOT QUALIFIED TO DO SO, OR TO ANY PERSON TO WHOM IT IS UNLAWFUL
TO MAKE SUCH OFFER OR SOLICITATION. NEITHER THE DELIVERY OF THIS PROSPECTUS NOR
ANY SALE MADE HEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION
THAT THE INFORMATION CONTAINED HEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO
THE DATE HEREOF.
------------------------

TABLE OF CONTENTS

3,700,000 SHARES
AMERICAN MEDICAL
PROVIDERS, INC.
CLASS A COMMON STOCK

------------------------

PROSPECTUS
------------------------

A.G. EDWARDS & SONS, INC.

J.C. BRADFORD & CO.

, 1998
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 13. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.

The following table sets forth the expenses to be paid by the Company
(other than underwriting compensation expected to be incurred) in connection
with the offering described in this Registration Statement. All amounts are
estimates, except the Securities and Exchange Commission registration fee, the
NASD filing fee and the Nasdaq National Market listing fee.

Securities and Exchange Commission
registration fee...................... $ 15,928
NASD filing fee......................... 5,606
Nasdaq National Market listing fee...... 62,725
Printing and engraving fees and
expenses.............................. 175,000
Legal fees and expenses................. 1,182,000
Accounting fees and expenses............ 2,800,000
Miscellaneous expenses.................. 259,166
------------
Total.............................. $ 4,500,000
============

ITEM 14. INDEMNIFICATION OF DIRECTORS AND OFFICERS.

AMERICAN MEDICAL PROVIDERS, INC.

DELAWARE GENERAL CORPORATION LAW

The General Corporation Law of the State of Delaware (the "DGCL")
provides for indemnification by a corporation of costs incurred by directors,
employees and agents in connection with an action, suit or proceeding brought by
reason of their position as a director, employee or agent. The person being
indemnified must have acted in good faith and in a manner he reasonably believed
to be in or not opposed to the best interests of the corporation. The DGCL
provides that a corporation may advance payment of expenses. The DGCL further
provides that the indemnification and advancement of expenses provisions of the
DGCL will not be deemed exclusive of any other rights to which these
indemnifications or advancements of expenses may be entitled under bylaw,
agreement, vote of stockholders or disinterested directors or otherwise, both as
to action under official capacity and as to action in another capacity when
holding such office.

In addition to the general indemnification section, Delaware law provides
further protection for directors under Section 102(b)(7) of the DGCL. This
section was enacted in June 1986 and allows a Delaware corporation to include in
its certificate of incorporation a provision that eliminates and limits certain
personal liability of a director for monetary damages for certain breaches of
the director' s fiduciary duty of care, provided that any such provision does
not (in the words of the statute) do any of the following:

"eliminate or limit the liability of a director (i) for any breach of
the director's duty of loyalty to the corporation or its stockholders, (ii)
for acts or omissions not in good faith or which involve intentional
misconduct or a knowing violation of law, (iii) under Section 174 of this
Title [dealing with willful or negligent violation of the statutory
provision concerning dividends and stock purchases and redemptions], or
(iv) for any transaction from which the director derived an improper
personal benefit. No such provision shall eliminate or limit the liability
of a director for any act or omission occurring prior to the date when such
provision becomes effective . . . ."

CERTIFICATE OF INCORPORATION

The Amended Restated Certificate of Incorporation of the Company provides
that the liability of directors of the Company shall be eliminated to the
fullest extent permissible under the DGCL. If the DGCL is amended to authorize
the further elimination or limitation of the liability of directors, then the
liability of a director of the Company, in addition to the limitation on
personal liability described above, shall be limited to the fullest extent
permitted by the amended DGCL. Further, any repeal or modification of such

II-1
<PAGE>
provision of the Amended and Restated Certificate of Incorporation by the
stockholders of the Company shall be prospective only, and shall not adversely
affect any limitation on the personal liability of a director of the Company
existing at the time of such repeal or modification.

BYLAWS

The Bylaws of the Company generally provide that the Company will indemnify
any person who was or is a party or is threatened to be made a party to any
threatened, pending or completed action by reason of the fact that he or she is
or was a director, officer, employee or agent, of the Corporation, or is or was
serving at the request of the Corporation as a director, officer, employee or
agent of another corporation, partnership, joint venture, trust or other
enterprise, against expenses (including attorneys' fees), actually and
reasonably incurred by him or her in connection with such action if he or she
acted in good faith and in a manner he or she reasonably believed to be in or
not opposed to the best interest of the Corporation; provided, however, that the
Company is only required to indemnify persons serving as directors, officers,
employees or agents of the Company for the expenses incurred in a proceeding if
such person is a party to and is successful, on the merits or otherwise, in such
proceeding. The Bylaws further provide that, in the event of any threatened, or
pending action, suit or proceeding in which any of the persons referred to above
is a party or is involved and that may give rise to a right of indemnification
under the Bylaws, following written request by such person, the Company will
promptly pay to such person amounts to cover expenses reasonably incurred by
such person in such proceeding in advance of its final disposition upon the
receipt by the Company of an undertaking executed by or on behalf of such person
providing that such person will repay the advance if it is ultimately determined
that such person is not entitled to be indemnified by the Company as provided in
the Bylaws.

ANKLE & FOOT CENTERS OF AMERICA, LLC

DELAWARE LIMITED LIABILITY COMPANY ACT

Subject to the restrictions, if any, as are set forth in its limited
liability company agreement, a Delaware limited liability company may, and has
the power to, indemnify and hold harmless any member or manager or other person
from and against any and all claims and demands whatsoever.

CERTIFICATE OF INCORPORATION

The Certificate of Incorporation of AFC generally provides that AFC will
indemnify any person who was or is a party or is threatened to be made a party
to any threatened, pending or completed action by reason of the fact that he or
she is or was a director, officer employee or agent, of AFC, or is or was
serving at the request of AFC as a director, officer, employee or agent of
another corporation, partnership, joint venture, trust or other enterprise,
against expenses (including attorneys' fees), actually and reasonably incurred
by him or her in connection with such action if he or she acted in good faith
and in a manner he or she reasonably believed to be in or not opposed to the
best interest of AFC; provided, however, that AFC is only required to indemnify
persons serving as directors, officers, employees or agents of AFC for the
expenses incurred in a proceeding if such person is a party to and is
successful, on the merits or otherwise, in such proceeding. The Certificate of
Incorporation further provides that, in the event of any threatened, or pending
action, suit or proceeding in which any of the persons referred to above is a
party or is involved and that may give rise to a right of indemnification under
the Certificate of Incorporation, following written request by such person, AFC
will promptly pay to such person amounts to cover expenses reasonably incurred
by such person in such proceeding in advance of its final disposition upon the
receipt by AFC of an undertaking executed by or on behalf of such person
providing that such person will repay the advance if it is ultimately determined
that such person is not entitled to be indemnified by AFC as provided in the
Certificate of Incorporation.

LIMITED LIABILITY COMPANY AGREEMENT

No member, affiliate or officer, director, shareholder, partner, employee
or agent or a member or any employee (an "AFC Person") shall be liable to the
Company or any other AFC Person for any loss, damage or claim incurred by reason
of any act or omission performed or omitted by such AFC Person in good faith on
behalf of AFC and in a manner reasonably believed to be within the scope of
authority

II-2
<PAGE>
conferred on such AFC Person, except that an AFC Person shall be liable for any
such loss, damage or claim incurred by reason of an AFC Person's gross
negligence or willful misconduct.

To the extent that, at law or in equity, an AFC Person has duties
(including fiduciary duties) and liabilities relating thereto to AFC or to any
other AFC Person, an AFC Person shall not be liable to AFC or to any other AFC
Person for its good faith reliance on the provisions of the LLC Agreement.

To the fullest extent permitted by applicable law, an AFC Person shall be
entitled to indemnification from AFC for any loss, damage or claim incurred by
such AFC Person by reason of any act or omission performed or omitted by such
AFC Person in good faith on behalf of the Company and in a manner reasonably
believed to be within the scope of authority conferred on an AFC Person, except
that no AFC Person shall be entitled to be indemnified in respect of any loss,
damage or claim incurred by such AFC Person by reason of gross negligence or
willful misconduct with respect to such acts or omissions.

To the fullest extent permitted by applicable law, expenses (including
legal fees) incurred by an AFC Person in defending any claim, demand, action,
suit or proceeding shall, from time to time, be advanced by AFC prior to the
final disposition of such claim, demand, action, suit or proceeding.

UNDERWRITING AGREEMENT

The Underwriting Agreement provides for the indemnification of the
directors and officers of the Company in certain circumstances.

INSURANCE

The Company intends to maintain liability insurance for the benefit of its
directors and officers.

ITEM 15. RECENT SALES OF UNREGISTERED SECURITIES.

The following information relates to securities of the Company issued or
sold within the past three years which were not registered under the Securities
Act:

The Company originally issued 20,000 shares of its common stock, without
class, par value $.01 per share on the dates listed below. On February 17, 1998
the Company converted each share of its existing common stock into 32.5 shares
of the Company's Class B Common Stock, par value $.001 per share. The share
numbers listed below reflect the effect of such conversion.

HOLDER NUMBER OF SHARES(1) DATE
- -------------------- ----------------------- --------
Jack N. McCrary..... 113,750 8/22/96
Jack N. McCrary..... 97,500 8/22/96
Ankle and Foot
Centers of
America, LLC(2)... 365,625 8/22/96
Kevin C. Graham..... 650 8/22/96
Wayne A. Bertsch.... 17,956 10/14/96
Wayne A. Bertsch.... 81 6/16/97
Randy Johnson....... 17,956 10/14/96
Randy Johnson....... 81 6/16/97
Cherie J. Partain... 325 10/14/96
Cherie J. Partain... 488 6/16/97
Robert C. Joyner.... 10,400 6/16/97
Robert C. Joyner.... 7,638 9/09/97
Amanda Walker....... 163 6/16/97
Gary Hubschman...... 6,500 6/16/97
Karen Boyle......... 487 6/16/97
Kenneth Arrowood.... 3,250 9/09/97
Cecil Pickens....... 1,625 10/14/97
Joseph Grau......... 1,625 10/14/97
Robert C. Joyner, as
Escrow Agent...... 3,900 9/09/97

(NOTES ON FOLLOWING PAGE)

II-3
<PAGE>
- ------------

(1) The Company received $200.00 in connection with the issuance of its original
650,000 shares to AFC and Jack McCrary. All other shares of the Company's
existing common stock were issued for par value.

(2) In August 1996, AMP was incorporated and shares of AMP were issued to AFC as
part of its formation efforts on behalf of AMP. In connection with certain
private placements of AFC during 1996, in an effort to fund the organization
and development of AMP, investors in these private placements are entitled
to be distributed the shares of AMP Class B currently held by AFC. Certain
of the investors pursuant to the private placement have the right to sell
one seventh of their shares for a portion of their initial investment.
Amounts to be distributed are as follows:
<TABLE>
<CAPTION>
DISTRIBUTABLE
MEMBERSHIP TOTAL CLASS B
MEMBER INTERESTS DATE CONSIDERATION SHARES
- ------------------------------------- ---------- --------- ------------- -------------
<S> <C> <C> <C> <C>
G. Brock Magruder.................... 5,469 5/5/96 $ 5,500 3,739
Stanley R. Kalish.................... 13,840 5/5/96 12,237 9,462
Thomas R. Whatley.................... 5,469 5/5/96 5,604 3,739
Alan H. Shaw......................... 13,840 5/5/96 12,300 9,462
Douglas H. Elleby.................... 13,839 5/5/96 12,237 9,461
S. F. Hartley........................ 13,839 5/5/96 12,237 9,461
Jack N. McCrary...................... 13,839 5/5/96 12,237 9,461
G. Brock Magruder, Jr................ 5,468 5/5/96 5,500 3,738
Mitchell G. Billing.................. 5,468 5/5/96 5,500 3,738
Ivan Wood(a)......................... 6,250 5/5/96 -- 4,273
Gregory Alvarez...................... 8,750 9/24/96 50,000 5,982
Johnnie W. Domingue.................. 8,750 9/24/96 50,000 5,982
Joseph D. Giovinco................... 8,750 9/24/96 50,000 5,982
S. F. Hartley........................ 8,750 9/24/96 50,000 5,982
J. M. Partners, Ltd.(b) ............. 17,500 9/24/96 100,000 11,964
Stanley R. Kalish.................... 17,500 9/24/96 100,000 11,964
Daniel B. Katz....................... 17,500 9/24/96 100,000 11,964
Erwin I. Katz........................ 17,500 9/24/96 100,000 11,964
Wendy C. Katz........................ 17,500 9/24/96 100,000 11,964
David LaGuardia...................... 43,750 9/24/96 250,000 29,909
Sherman Nagler....................... 8,750 9/24/96 50,000 5,982
Robert G. Parker..................... 17,500 9/24/96 100,000 11,964
Steven P. Richman.................... 8,750 9/24/96 50,000 5,982
Jerry Silverman...................... 8,750 9/24/96 50,000 5,982
Texas Podiatry Group -- Houston...... 17,500 9/24/96 100,000 11,964
George R. Vito....................... 8,750 9/24/96 50,000 5,982
John D. West......................... 17,500 9/24/96 100,000 11,964
Texas Podiatry Group, PPLC........... 8,750 9/24/96 50,000 5,982
Richard H. Weiner.................... 17,500 9/24/96 100,000 11,964
Southwest Podiatry Assoc, PA......... 8,750 9/24/96 50,000 5,982
Steven T. Arminio.................... 8,750 9/24/96 50,000 5,982
Robert I. Schwartz................... 8,750 9/24/96 50,000 5,982
Western Indemnity.................... 17,500 9/24/96 100,000 11,964
Bellaire Surgicare, IPA.............. 17,500 9/24/96 100,000 11,964
Sam H. Carr.......................... 1,750 9/24/96 10,000 1,196
Kevin C. Graham...................... 1,750 9/24/96 10,000 1,196
Randy E. Johnson..................... 875 9/24/96 5,000 598
Wayne A. Bertsch..................... 4,375 9/24/96 25,000 2,991
Robert C. Joyner..................... 4,375 6/16/97 25,000 2,991
Bay Area Podiatry Associates......... 8,750 8/1/97 50,000 5,982

(TABLE CONTINUED ON FOLLOWING PAGE)

II-4
<PAGE>
<CAPTION>
DISTRIBUTABLE
MEMBERSHIP TOTAL CLASS B
MEMBER INTERESTS DATE CONSIDERATION SHARES
- ------------------------------------- ---------- --------- ------------- -------------
Bay Area Podiatry Associates......... 4,375 8/1/97 25,000 2,991
Thomas S. Garrison................... 4,375 8/1/97 25,000 2,991
Alan H. Shaw......................... 8,750 9/24/96 50,000 5,982
Kenneth R. Draughan.................. 4,375 9/24/96 25,000 2,991
Jack N. McCrary...................... 52,500 9/24/96 (c) 35,892
</TABLE>
- ------------

(a) Such interests were issued to Mr. Wood for services rendered to AFC in
connection with its formation and organization.

(b) Membership interests were originally issued to J. M. Partners, Ltd., an
affiliate of John S. Bace. Subsequently, J. M. Partners, Ltd. transferred
its membership interests to Mr. Bace, family members and trusts controlled
by Mr. Bace.

(c) Mr. McCrary's membership interest in AFC was issued to him in exchange for
his agreement to defer compensation of $300,000 until successful completion
of the Offering.

In addition, AFC sold an aggregate of $1,472,500 in non-interest bearing
loans and 25,840 membership interests to certain investors listed below (the
"AFC Units"). This Bridge Financing provided for the loans to be repaid by AFC
from funds received pursuant to the Reimbursement and Assumption Agreement. In
addition, AFC is required to repurchase the membership interests in each AFC
unit for $71,667 in cash. Thus, none of these investors in the Bridge Financing
will receive a distribution of Class B Common Stock held by AFC because the
membership interests in AFC held by such investors will be repurchased. The
following lists the Bridge Investors in AFC, the membership interests and the
promissory notes purchased and the total consideration paid by such investors to
AFC:

MEMBERSHIP PROMISSORY TOTAL
BRIDGE INVESTORS INTERESTS NOTE CONSIDERATION
- ---------------------------------- ---------- ---------- -------------
W.D. Steven....................... 1,667 $ 95,000 $ 100,000
Frederick L. Hill................. 1,667 95,000 100,000
Robert C. Joyner.................. 1,667 95,000 100,000
Jack N. McCrary................... 1,667 95,000 100,000
John S. Bace, IRA................. 1,667 95,000 100,000
John D. West...................... 1,667 95,000 100,000
Wayne A. Bertsch(1)............... 1,667 95,000 100,000
Dr. Anjali Jain, M.D.............. 1,667 95,000 100,000
Dr. George R. Vito, D.P.M......... 1,667 95,000 100,000
Sam Pollak........................ 1,667 95,000 100,000
Joseph Blog....................... 2,501 142,500 150,000
Davis L. Ford..................... 834 47,500 50,000
Robert C. Hux..................... 4,168 237,500 250,000
Max C. Butler..................... 1,667 95,000 100,000

- ------------

The foregoing securities were issued pursuant to the exemption from
registration under Section 4(2) of the Act since no public offering was involved
and the securities were acquired for investment and not with a view to
distribution.

II-5
<PAGE>
ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.

(a) Exhibits:

The following exhibits are filed pursuant to Item 601 of Regulation S-K:

<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
- ------------------------ ------------------------------------------------------------------------------------------
<S> <C>
1.1* -- Form of Underwriting Agreement
3.1* -- Form of Amended and Restated Certificate of Incorporation of American Medical Providers,
Inc. (the "Company")
3.2* -- Form of Amended and Restated Bylaws of the Company
3.3* -- Certificate of Incorporation of Ankle & Foot Centers of America, LLC ("AFC")
3.4* -- Limited Liability Company Agreement of AFC
4.1* -- Form of Certificate of Designation, Preferences and Rights of Series A Junior
Participating Preferred Stock
4.2* -- Form of Certificate for Class A Common Stock
4.3* -- Form of Certificate for Class B Common Stock
5.1* -- Opinion of Baker & Hostetler, LLP regarding legality of securities being registered
10.1* -- Form of 1997 Incentive and Non-Qualified Stock Option Plan of the Company
10.2* -- Employment Agreement between Ankle & Foot Centers of America LLC ("AFC") and Jack N.
McCrary
10.3* -- Employment Agreement between AFC and Wayne A. Bertsch
10.4* -- Employment Agreement between AFC and Randy E. Johnson
10.5* -- Form of Management Services Agreement by and among the Company and each Regional Group
Practice
10.6* -- Form of Physician Employment Agreement by and between each non-practice owner DPM and the
Regional Group Practice
10.7* -- Form of Physician Engagement Agreement by and between each DPM practice owner and the
Regional Group Practice
10.8* -- Form of Stock Purchase Agreement among the Company and certain DPM practice owners (with
attached schedule)
10.9* -- Form of Business Purchase Agreement among the Company and certain DPM practice owners
(with attached schedule)
10.10* -- Asset Purchase Agreement dated October 31, 1997 among the Company and Pyramid
Anesthesiology Group, Inc.
10.11* -- Form of Registration Rights Agreement between the Company and each DPM practice owner
10.12* -- Form of Stockholder Protection Agreement dated as of February , 1998 between the Company
and , as Rights Agent.
10.13* -- Reimbursement and Assumption Agreement dated as of January 20, 1998 between the Company
and Ankle & Foot Centers of America, L.L.C.
10.14* -- Letter Agreement dated December 30, 1997 between the Company and Cooperative Centrale
Raiffeisen-Boerenleenbank B.A. "Rabobank Nederland," New York Branch
10.15* -- Stock Purchase Agreement among the Company, Jerald N. Kramer, D.P.M., P.C., and the Owners
named thereon
10.16* -- Employment Agreement between AFC and David LaGuardia
10.17* -- Employment Agreement between AFC and Roger Bigham
10.18* -- Lease Agreement with and entered into effective January 19, 1997 by and between Doctors
Hospital 1997, LP and the Company
10.19* -- Lease Agreement with and entered into effective January 19, 1997 by and between Mid
American Equities, L.P. and the Company
23.1 -- Consent of Arthur Andersen LLP
23.2* -- Consent of Baker & Hostetler, LLP (contained in Exhibit 5.1)
24.1* -- Power of Attorney (contained on the signature page II-4 of this Registration Statement)

II-6
<PAGE>
EXHIBIT
NUMBER DESCRIPTION
- ------------------------ ------------------------------------------------------------------------------------------
27.1* -- Financial Data Schedule
99.1* -- Consent of Stanley R. Kalish, D.P.M. to serve on the Company's Board of Directors
99.2* -- Consent of John S. Bace to serve on the Company's Board of Directors
99.3* -- Consent of S.F. Hartley, D.P.M. to serve on the Company's Board of Directors
99.4* -- Consent of Donald S. Huge, M.D. to serve on the Company's Board of Directors
99.5 -- Bridge Financing Rescission Form
99.6 -- Practice Owner Rescission Form
</TABLE>

- ------------

* Previously filed.

(b) Financial Statement Schedules.

All schedules are omitted because they are not applicable or because the
required information is contained in the Financial Statements or Notes thereto.

ITEM 17. UNDERTAKINGS.

The undersigned registrant hereby undertakes as follows:

(1) To provide to the Underwriters at the closing specified in the
Underwriting Agreement certificates in such denominations and registered in
such names as required by the Underwriters to permit prompt delivery to
each purchaser.

(2) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and
controlling persons of the registrant pursuant to the provisions described
in Item 14, or otherwise, the registrant has been advised that in the
opinion of the Commission such indemnification is against public policy as
expressed in the Act and is, therefore, unenforceable. In the event that a
claim for indemnification against such liabilities (other than the payments
by the registrant of expenses incurred or paid by a director, officer or
controlling person of the registrant in the successful defense of any
action, suit or proceeding) is asserted by such director, officer or
controlling person in connection with the securities being registered, the
registrant will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against
public policy as expressed in the Act and will be governed by the final
adjudication of such issue.

(3) That, for the purposes of determining any liability under the
Securities Act, the information omitted from the form of prospectus filed
as part of this registration statement in reliance upon Rule 430A and
contained in a form of prospectus filed by the registrant pursuant to Rule
424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed to be
part of this registration statement as of the time it was declared
effective.

(4) That, for the purpose of determining any liability under the
Securities Act of 1933, each post-effective amendment that contains a form
of prospectus shall be deemed to be a new registration statement relating
to the securities offered therein, and the offering of such securities at
that time shall be deemed to be the initial bona fide offering thereof.

II-7
<PAGE>
SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, as amended,
American Medical Providers, Inc. has duly caused this Registration Statement to
be signed on its behalf by the undersigned, thereunto duly authorized, in the
City of Houston, State of Texas, on March 9, 1998.

AMERICAN MEDICAL PROVIDERS, INC.
By: /s/ JACK N. McCRARY
JACK N. MCCRARY
CHAIRMAN, PRESIDENT AND CHIEF
EXECUTIVE OFFICER

Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.

SIGNATURE TITLE DATE
- ----------------------------------------------------------- ------------------
/s/JACK N. McCRARY Chairman, President, Chief March 9, 1998
JACK N. MCCRARY Executive Officer and Director
(Principal Executive Officer)
/s/WAYNE A. BERTSCH Senior Vice President, Chief March 9, 1998
WAYNE A. BERTSCH Financial Officer and Director
(Principal Financial and
Accounting Officer)
/s/CECIL R. PICKENS Vice President and Chief March 9, 1998
CECIL R. PICKENS Accounting Officer (Principal
Accounting Officer)

II-8
<PAGE>
SIGNATURES

ANKLE & FOOT CENTERS OF AMERICA, LLC
By: /s/ JACK N. McCRARY
JACK N. MCCRARY
MANAGING DIRECTOR, PRESIDENT AND
CHIEF EXECUTIVE OFFICER

Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.

SIGNATURE TITLE DATE
- ----------------------------------------------------------- ------------------
/s/JACK N. McCRARY President, Chief Executive March 9, 1998
JACK N. MCCRARY Officer and Managing Director
(Principal Executive Officer)
/s/WAYNE A. BERTSCH Senior Vice President, Chief March 9, 1998
WAYNE A. BERTSCH Financial Officer (Principal
Financial and Accounting
Officer)
/s/CECIL R. PICKENS Vice President and Chief March 9, 1998
CECIL R. PICKENS Accounting Officer (Principal
Accounting Officer)

II-9

EXHIBIT 23.1

CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS

As independent public accountants, we hereby consent to the use of our
reports and all references to our Firm included in this registration statement
on Form S-1 filed by American Medical Providers, Inc.

ARTHUR ANDERSEN LLP

Houston, Texas
March 6, 1998

EXHIBIT 99.5

ANKLE AND FOOT CENTERS OF AMERICA, LLC
AMERICAN MEDICAL PROVIDERS, INC.
UNITS
RESCISSION FORM

NOTICE TO THE OFFEREES OF THE AMERICAN MEDICAL PROVIDERS, INC. RESCISSION OFFER:

THIS UNITS RESCISSION FORM MUST BE FULLY EXECUTED AND RECEIVED BY ANKLE & FOOT
CENTERS OF AMERICA, LLC ("AFC") TOGETHER WITH THE PROMISSORY NOTE(S) ("AFC
PROMISSORY NOTES") AND CERTIFICATE(S) OF MEMBERSHIP INTERESTS IN AFC ("AFC
MEMBERSHIP INTERESTS") BEING RESCINDED, NO LATER THAN MARCH , 1998 AT 5:00
P.M. (THE "EXPIRATION DATE") IN ORDER FOR AN INVESTOR TO ACCEPT AFC'S AND
AMERICAN MEDICAL PROVIDERS, INC.'S (THE "COMPANY") OFFER OF RESCISSION (THE
"UNITS RESCISSION OFFER"). FAILURE TO DELIVER THIS UNITS RESCISSION FORM BY
THE EXPIRATION DATE WILL EVIDENCE THE INVESTOR'S INTENTION TO REJECT THE
RESCISSION OFFER. AN EXPLANATION OF THE ALTERNATIVE RIGHTS OF THE INVESTORS IN
THE EVENT THEY ACCEPT OR REJECT THE RESCISSION OFFER ARE SET FORTH ON THE COVER
PAGES AND IN THE PROSPECTUS DATED MARCH , 1998. SEE "UNITS RESCISSION
OFFER."

This Units Rescission Offer relates to a rescission offer with respect to
$1.4725 million principal amount of AFC Promissory Notes and 25,840 membership
interests ("AFC Units") of AFC. The AFC Units were offered and sold by AFC, a
principal stockholder of American Medical Providers, Inc. (the "Company"), to
16 investors in reliance on certain exemptions from registration under the
Securities Act of 1933 (the "Securities Act"). Because certain of the AFC
Units were offered and sold after the Company's registration statement for its
initial public offering was filed with the Securities and Exchange Commission
(the "Commission") by AFC and because, as part of your investment in the AFC
Units, you were given the option by the Company to purchase shares in the
Company's underwritten initial public offering, an argument can be made that the
consummation of the Company's public offering of Common Stock will cause such
exemptions to be retroactively unavailable.

NOTICE TO RESIDENTS OF TEXAS:

IF A RESCISSION OFFER COMPLIES WITH THE REQUIREMENTS OF TEXAS LAW, AN
INVESTOR MAY NOT SUE ON HIS OR HER PURCHASE UNDER SECTION 33 OF THE TEXAS
SECURITIES ACT UNLESS (I) HE OR SHE ACCEPTS THE UNITS RESCISSION OFFER BUT DOES
NOT RECEIVE THE AMOUNT OF THE OFFER IN WHICH CASE HE OR SHE MAY SUE WITHIN 3
YEARS AFTER THE SALE OR (II) HE OR SHE REJECTS THE OFFER IN WRITING WITHIN 30
DAYS OF RECEIPT AND EXPRESSLY RESERVES IN THE REJECTION HIS RIGHT TO SUE, IN
WHICH CASE HE OR SHE MAY SUE WITHIN ONE YEAR AFTER HE SO REJECTS.

COMPLETE AND SIGN ONLY ONE OF THE TWO FOLLOWING SECTIONS:
I. ACCEPTANCE OF UNITS RESCISSION OFFER

ACCEPT UNITS RESCISSION OFFER. The undersigned has received and had the
opportunity to review the attached Prospectus which sets forth the terms of a
Units Rescission Offer of AFC. The undersigned acknowledges and understands that
if he or she elects to accept the Units Rescission Offer by completing this
section entitled "Acceptance of Units Rescission Offer," then the AFC Units
purchased by the undersigned as part of AFC's Bridge Financing (the "Bridge
Financing") will be repurchased by AFC and he or she will no longer by entitled
to any rights as a security holder of AFC by virtue of previously investing in
AFC Units as part of the Bridge Financing. The undersigned will be paid the
purchase price for each AFC Unit equal to $95,000 for the AFC Promissory Note
and $5,000 for AFC membership interests plus a statutory rate of interest on the
total $100,000 investment beginning on the date of the undersigned's purchase of
his or her AFC Unit(s). The undersigned understands and acknowledges that such
repayment shall be made promptly following the closing of the Company's initial
public offering, but in no event more than 30 days after the receipt of the AFC
Promissory Note and certificates representing the membership
<PAGE>
EXHIBIT 99.5
(CONTINUED)

certificates purchased in the Bridge Financing. The payment by AFC for the Units
Rescission Offer will be made at Bank of America of Texas, 3 Greenway Plaza
East, Houston, Texas 77046. The undersigned understands and acknowledges that
the repayment shall satisfy in full all claims or potential claims of the
undersigned in connection with his or her purchase of AFC Units including, but
not limited to any claims under federal or state securities laws for the offer
and sale of AFC Units. In addition, the undersigned acknowledges that he or she
will not retain the right to have Class A Common Stock of the Company set aside
to purchase at the initial public offering price of such shares. The
undersigned, being a holder of AFC Units, hereby elects to accept the Units
Rescission Offer to rescind his or her investment in the AFC Unit(s) purchased
under the terms set forth in the Prospectus dated March __, 1998.

Number of AFC Units
Subject to Acceptance of Rescission: ________________________

- -------------------- ---------------------------------------------------------
(Date) (Signature)

II. REJECTION OF UNITS RESCISSION OFFER

REJECT UNITS RESCISSION OFFER. The undersigned has received and had the
opportunity to review the attached Prospectus which sets forth the terms of a
Units Rescission Offer of AFC. The undersigned acknowledges and understands that
if he or she elects to reject the Units Rescission Offer by completing this
section entitled "Rejection of Units Rescission Offer," the undersigned will
continue to hold AFC Unit(s) including the AFC Promissory Note(s) and AFC
membership interests purchased pursuant to the Bridge Financing. Upon
consummation of the Company's initial public offering and with respect to each
full AFC Unit, the AFC Promissory Note will be repurchased for $95,000 and
membership interests purchased in the Bridge Financing will be repurchased for
$71,667 cash. The undersigned understands and acknowledges that such repayment
shall satisfy in full all claims or potential claims of the undersigned in
connection with his or her purchase of AFC Units including, but not limited to
any claims under federal or state securities laws for the offer and sale of AFC
Units. In addition, the undersigned will not retain the right to have any Class
A Common Stock set aside to purchase at the Company's initial public offering
price. The undersigned, being a holder of AFC Units hereby elects to reject the
Units Rescission Offer, under the terms set forth in the Prospectus dated March
__, 1998.

Number of AFC Units
Subject to Acceptance of Rescission: $________________________

- -------------------- ---------------------------------------------------------
(Date) (Signature)

EXHIBIT 99.6

AMERICAN MEDICAL PROVIDERS, INC.
PRACTICE OWNER

RESCISSION FORM

NOTICE TO THE OFFEREES OF THE AMERICAN MEDICAL PROVIDERS, INC. RESCISSION OFFER:

THIS PRACTICE OWNER RESCISSION FORM MUST BE FULLY EXECUTED AND RECEIVED BY
AMERICAN MEDICAL PROVIDERS, INC., NO LATER THAN MARCH , 1998 AT 5:00 P.M. (THE
"EXPIRATION DATE") IN ORDER FOR YOU TO ACCEPT THE COMPANY'S OFFER OF
RESCISSION ("PRACTICE OWNER RESCISSION OFFER"). FAILURE TO DELIVER THIS
PRACTICE OWNER RESCISSION FORM BY THE EXPIRATION DATE WILL EVIDENCE YOUR
INTENTION TO REJECT THE PRACTICE OWNER RESCISSION OFFER. AN EXPLANATION OF THE
ALTERNATIVE RIGHTS OF THE INVESTORS IN THE EVENT THEY ACCEPT OR REJECT THE
PRACTICE OWNER RESCISSION OFFER ARE SET FORTH ON THE COVER PAGES OF THE
PROSPECTUS DATED MARCH , 1998.

COMPLETE AND SIGN ONLY ONE OF THE TWO FOLLOWING SECTIONS:

This Practice Owner Rescission Offer relates to an offer by American
Medical Providers, Inc. (the "Company") to rescind a potential non-binding
offer to sell Class A common stock, par value $.001 per share, of the Company
("Common Stock"), made on certain dates between November 5, 1997 and February
11, 1998 to the 13 holders of certain operating assets of, or the stock of
entities holding certain operating assets of, twelve podiatric practices (the
"Practice Owners"). None of these negotiations or letters of intent involved
the initial Affiliated Practices. The Company has determined that the Practice
Offer may not have satisfied the requirements of the Securities Act of 1933, as
amended (the "Securities Act"), because no prospectus was distributed to the
Practice Owners as required by the Securities Act.

NOTICE TO RESIDENTS OF TEXAS:

A PRACTICE OWNER MAY NOT SUE ON HIS OR HER PURCHASE UNDER SECTION 33 OF THE
TEXAS SECURITIES ACT UNLESS HE OR SHE REJECTS THE OFFER IN WRITING WITHIN 30
DAYS OF RECEIPT AND EXPRESSLY RESERVES IN THE REJECTION HIS RIGHT TO SUE, IN
WHICH CASE HE OR SHE MAY SUE WITHIN ONE YEAR AFTER HE SO REJECTS.

I. ACCEPTANCE OF PRACTICE OWNER RESCISSION OFFER

ACCEPT PRACTICE OWNER RESCISSION OFFER. The undersigned has received and
had the opportunity to review the attached Prospectus which sets forth the terms
of a Practice Owner Rescission Offer of the Company. The undersigned
acknowledges and agrees that if he or she elects to accept the Company's
Practice Owner Rescission Offer by completing this section entitled "Acceptance
of Practice Owner Rescission Offer," the undersigned's non-binding letter of
intent with the Company and any other related documents shall be cancelled and
rendered null and void. In that case, all negotiations between the Company and
the undersigned concerning the possible acquisition of assets or stock of the
undersigned's podiatric practice would not continue. The undersigned understands
and acknowledges that upon delivery of this Practice Owner Rescission Form with
this section entitled "Acceptance of Practice Owner Rescission Offer"
completed, he or she releases the Company in full from all claims or potential
claims of the undersigned in connection with the offer to sell Class A Common
Stock of the Company to the undersigned including, but not limited to, any
claims under federal or state securities laws for the offer of Class A Common
Stock. The undersigned, being an owner of a podiatric practice to whom the
Company made an offer to purchase shares of the Company's Class A Common Stock,
hereby elects to accept the Practice Owner Rescission Offer, under the terms set
forth in the Prospectus dated March __, 1998.

- --------------------------------------- ---------------------------------------
(Date) (Signature)
<PAGE>
EXHIBIT 99.6
(CONTINUED)

II. REJECTION OF PRACTICE OWNER RESCISSION OFFER

REJECT PRACTICE OWNER RESCISSION OFFER. The undersigned has received and
had the opportunity to review the attached Prospectus which sets forth the terms
of a Practice Owner Rescission Offer of the Company. The undersigned
acknowledges and understands that if he or she elects to reject the Company's
Practice Owner Rescission Offer by completing this section entitled "Rejection
of Practice Owner Rescission Offer," any further negotiations between the
Company and the undersigned with respect to the undersigned's podiatric practice
will not recommence until after the earlier of (i) 30 days from the date of the
Prospectus included herein or (ii) the Company's receipt of a properly completed
Practice Owner Rescission Form from each Practice Owner. Upon the termination of
this rescission period, the Company intends to recommence negotiations with all
Practice Owners rejecting the Practice Owner Rescission Offer and may, as part
of the negotiations, offer shares of the Company's Common Stock registered in
the Company's Registration Statement on Form S-4 to such Practice Owners. The
undersigned understands and acknowledges that upon delivery of this Practice
Owner Rescission Form with this section entitled "Rejection of Practice Owner
Rescission Offer" completed, he or she releases the Company in full from all
claims or potential claims of the undersigned in connection with the offer to
sell Class A Common Stock of the Company to the undersigned including, but not
limited to, any claims under federal or state securities laws for the offer of
Class A Common Stock. The undersigned, being an owner of a podiatric practice to
whom the Company made an offer to purchase shares of the Company's Class A
Common Stock, hereby elects to reject the Practice Owner Rescission Offer, under
the terms set forth in the Prospectus dated March __, 1998.

- --------------------------------------- ---------------------------------------
(Date) (Signature)