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REGISTRATION NO. 33-98528
RULE 424(b)(5)
SUPPLEMENT TO PROSPECTUS,
DATED AUGUST 28, 1996
PHYCOR, INC.
3,000,000 SHARES
COMMON STOCK
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The Prospectus, dated August 28, 1996 (the "Prospectus"), to
which this Supplement, dated January 29, 1997, is attached (the "Supplement"),
relates to the resale by the holders thereof of up to an aggregate of 3,000,000
shares of Common Stock, no par value per share (the "Common Stock"), of PhyCor,
Inc. (the "Company"), issued upon the conversion of subordinated convertible
notes issued or to be issued by the Company without registration under the
Securities Act of 1933, as amended (the "Act") in connection with the
acquisition of the assets of (i) single and multi-specialty medical clinics,
(ii) the assets of individual physician practices and (iii) the assets of
related businesses, including, but not limited to, management services
organizations, consulting firms and other physician management companies. In
addition, this Prospectus also relates to the resale by certain holders of
Common Stock issued upon the exercise of options granted by the Company prior
to the adoption by the Company of its stock incentive plans and warrants issued
as consideration for (i) consulting or other services provided or to be
provided to the Company and (ii) the execution of a management or service
agreement with the Company or an affiliate. This Supplement relates to the
proposed resale, from time to time, by the Physicians listed on Schedule A
hereto (each a "Physician") of up to an aggregate of 14,112 shares (the
"Shares") of the Company's Common Stock.
On January 24, 1997, the Company issued an aggregate of
128,101 shares of Common Stock to Northeast Arkansas Internal Medicine Clinic,
P.A., an Arkansas professional association (the "Clinic"), upon the conversion
of a 7.0% Subordinated Convertible Note (the "Note"). The Note was previously
issued by the Company to the Clinic in connection with the acquisition by
PhyCor of Northeast Arkansas, Inc., a Tennessee corporation and wholly-owned
subsidiary of the Company ("PhyCor-Arkansas"), of certain assets of the Clinic
pursuant to an Asset Purchase Agreement between PhyCor and the Clinic effective
as of March 1, 1995 (the "Purchase Agreement"). Upon conversion of the Note,
the Clinic sold 16,819 shares of Common Stock pursuant to a Supplement to the
Prospectus dated January 29, 1997 and distributed the Shares to the Physicians
on a pro rata basis based on the Physicians' respective ownership of the
Clinic. All share numbers used herein give effect to a three-for-two stock
split of the Common Stock effected on June 14, 1996 in the form of a 50% stock
dividend. Terms defined in the Prospectus have the same meaning in this
Supplement unless the context otherwise requires.
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The date of this Supplement is January 30, 1997.
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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.
Selling Shareholders
Each Physician is licensed to practice medicine pursuant to
the laws of the State of Arkansas and practiced medicine through the Clinic
prior to the transaction noted above. The Company, through PhyCor-Arkansas
acquired substantially all of the assets of the Clinic pursuant to the Purchase
Agreement. In connection therewith, the Company issued the Note to the Clinic,
and on January 24, 1997, the Note was partially converted into an aggregate of
128,101 shares of Common Stock. Of these shares, 16,819 shares were resold by
the Clinic pursuant to a Supplement to the Prospectus, dated January 29, 1997.
The Shares were then distributed to the Physicians on a pro rata basis based on
the Physicians' respective ownership of the Clinic. The Shares may be resold by
a Physician through a registered broker-dealer in accordance with the terms of
the Prospectus. The aggregate number of Shares that may be resold by each
Physician is indicated on Schedule A hereto.
Plan of Distribution
This Supplement relates to the reoffering, from time to time,
of the Shares through a registered broker-dealer. The resale of the Shares will
be effected through a registered broker-dealer in private or block transactions
in the over-the-counter market (including The Nasdaq Stock Market (National
Market)) or otherwise at fixed prices which may be changed, at market prices
prevailing at the time of the sale, at prices related to such prevailing market
price, or at negotiated prices. The broker-dealer may effect such transactions
by selling the Shares to or through other broker-dealers, and such
broker-dealers may receive compensation in the form of discounts, concessions
or commissions from the purchasers of the Shares for whom such broker-dealers
may act as agent or to whom they may sell as principal, or both (which
compensation as to a particular broker-dealer might be in excess of customary
commissions). As a result of the reoffering of the Shares pursuant to the
Prospectus, as supplement hereby, the Company and the respective broker-dealers
may be deemed to be "underwriters" within the meaning of Section 2(11) of the
Securities Act of 1933, as amended.
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Schedule A
Physician Address SSN Shares
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WILLIAM S. HUBBARD 2510 Rosewood Circle ###-##-#### 5,000
Jonesboro, AR 72401
GARY R. GOZA 2507 Rosewood Circle ###-##-#### 5,240
Jonesboro, AR 72401
DENNIS R. BROWN 1614 Whitehaven Court ###-##-#### 3,872
Jonesboro, AR 72401
