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FILED PURSUANT TO RULE 424(B)(5)
REGISTRATION NO. 33-98530
SUPPLEMENT
TO PROSPECTUS, DATED NOVEMBER 15, 1995
PHYCOR, INC.
$90,000,000
COMMON STOCK, COMMON STOCK WARRANTS AND DEBT SECURITIES
_____________________________
The Prospectus, dated November 15, 1995 (the "Prospectus"), to
which this Supplement, dated August 16, 1996 is attached, relates to the offer
by PhyCor, Inc., a Tennessee corporation (the "Company"), of shares of the
Company's Common Stock, no par value per share ("Common Stock"), warrants to
purchase Common Stock ("Common Stock Warrants") and the shares of Common Stock
issued thereunder upon the exercise of such Common Stock Warrants, or debt
securities ("Debt Securities"), and the shares of Common Stock issued thereunder
upon the conversion thereof, with a collective aggregate offering price of up to
$90,000,000 on terms to be determined at the time of any such offering. The
Company may offer Common Stock, Common Stock Warrants, or Debt Securities
(collectively, "Securities") from time to time in connection with the
acquisitions of the assets or stock of (i) individual physician practices, (ii)
single and multi-specialty medical clinics and (iii) related businesses,
including, but not limited to, management services organizations, consulting
firms and other physician management companies. The consideration for the
acquisition of the assets or stock of such entities may consist of cash, the
assumption of liabilities, Securities, or any combination thereof, as determined
pursuant to negotiations between the Company and the sellers of the assets or
stock to be acquired.
This Supplement relates to the issuance of an aggregate of
125,866 shares of Common Stock to (i) Youngblood-Incalcaterra Clinic, L.L.P., a
Texas limited liability partnership ("Youngblood"), and Bay Area Family Medical
Center, P.A., a Texas professional association ("Bay Area"), as partial
consideration for the acquisition by the Company of substantially all of the
operating assets of the medical practices of Youngblood and Bay Area and (ii)
Gulf Coast Medical Group, P.L.L.C., a Texas professional limited liability
company ("Gulf Coast"), as partial consideration for the execution of a Service
Agreement, dated as of August 1, 1996, by and between Gulf Coast and the Company
(the "Service Agreement"). Terms defined in the Prospectus have the same
meaning in this Supplement unless the context otherwise required.
THIS SUPPLEMENT INCORPORATES DOCUMENTS BY REFERENCE WHICH ARE
NOT PRESENTED HEREIN OR DELIVERED HEREWITH. THESE DOCUMENTS ARE AVAILABLE UPON
WRITTEN OR ORAL REQUEST, AT NO CHARGE, FROM THE COMPANY. REQUESTS SHOULD BE
DIRECTED TO PHYCOR, INC., 30 BURTON HILLS BOULEVARD, SUITE 400, NASHVILLE,
TENNESSEE 37215, ATTENTION: N. CAROLYN FOREHAND, VICE PRESIDENT AND GENERAL
COUNSEL.
_____________________________
The date of this Supplement is August 16, 1996.
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Terms of the Acquisition
Pursuant to an Asset Purchase Agreement (the "Youngblood
Purchase Agreement"), dated as of August 1, 1996, by and between Youngblood and
the Company, the Company acquired substantially all of the operating assets of
Youngblood's medical practice. Pursuant to the Youngblood Purchase Agreement,
and in partial consideration therefor, the Company agreed to issue 24,746
shares of Common Stock to Youngblood.
Pursuant to an Asset Purchase Agreement (the "Bay Area
Purchase Agreement"), dated as of August 1, 1996, by and between Bay Area and
the Company, the Company acquired substantially all of the operating assets of
Bay Area's medical practice. Pursuant to the Bay Area Purchase Agreement, and
in partial consideration therefor, the Company agreed to issue 1,976 shares of
Common Stock to Bay Area.
The Company also acquired substantially all of the operating
assets of GCMG, P.A., a Texas professional association ("GCMG"), pursuant to an
Asset Purchase Agreement, dated as of August 1, 1996, by and between GCMG and
the Company. The Company did not, however, issue any Common Stock in
connection with this acquisition.
In connection with the Youngblood, Bay Area and GCMG
acquisition, the physicians associated with such entities terminated their
affiliations with their respective medical clinics and became members of Gulf
Coast Medical Group, P.L.L.C, a Texas professional limited liability company
("Gulf Coast"). In addition, in connection with the acquisitions noted above,
the Company, entered into the Service Agreement with Gulf Coast. As partial
consideration for the entering into of Service Agreement, the Company agreed to
issue 99,144 shares of Common Stock to Gulf Coast. Pursuant to the Service
Agreement, the Company, through a corporate subsidiary, will (i) provide Gulf
Coast with equipment and facilities used in Gulf Coast's medical practice, (ii)
manage Gulf Coast operations and (iii) employ certain of Gulf Coast's
non-medical professional personnel in exchange for a service fee. The term of
the Service Agreement extends for a period of 40 years and may only be
terminated under limited circumstances.
