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REGISTRATION NO. 33-98530
RULE 424(b)(5)
SUPPLEMENT
TO PROSPECTUS, DATED NOVEMBER 15, 1995
PHYCOR, INC.
$90,000,000
COMMON STOCK, COMMON STOCK WARRANTS AND DEBT SECURITIES
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The Prospectus, dated November 15, 1995 (the "Prospectus"), to which this
Supplement, dated May 13, 1997 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 arm's-length negotiations between the Company and the sellers of the
assets or stock to be acquired.
Common Stock issued to individual physician practices, single and
multi-specialty clinics and related businesses, as described above, may be
reoffered by the holders thereof from time to time in transactions in the
over-the-counter market, in negotiated transactions, through the writing of
options on Securities, or a combination of such methods of sale, at fixed prices
which may be changed, at market prices prevailing at the time of sale, at prices
relating to the prevailing market prices, or negotiated prices.
This Supplement relates to the proposed distribution of 15,748 shares (the
"Shares") of the Company's Common Stock by The Vancouver Clinic, Inc., P.S., a
Washington professional service corporation (the "Clinic"), to certain
shareholders of the Clinic. The Shares were issued to the Clinic in connection
with the acquisition by the Company of certain assets of the Clinic pursuant to
an Asset Purchase Agreement between the Company and the Clinic effective as of
January 1, 1997 (the "Purchase Agreement"). Capitalized terms used in this
Supplement shall have the meanings given to them in the Prospectus, unless the
context otherwise requires.
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The date of this Supplement is May 13, 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 Shareholder
The Clinic operates a multi-specialty medical clinic in Vancouver,
Washington and maintains three satellite locations in the area. The Clinic's
principal office is located at 700 N.E. 87th Avenue, Vancouver, Washington
98664.
The Company acquired substantially all of the assets of the Clinic pursuant
to the Purchase Agreement. In connection therewith, the Company issued the
Shares to the Clinic pursuant to the Company's "shelf" Registration Statement on
Form S-4, of which the Prospectus forms a part. The Clinic intends to distribute
the Shares pursuant to the terms of the Prospectus and this Supplement to
certain of its existing physician shareholders (the "Physicians") who elected to
receive shares of Common Stock in lieu of cash for a portion of the proceeds
paid to the Clinic that will be further distributed to the Physicians. See "Plan
of Distribution."
In connection with the acquisition of the assets of the Clinic, PhyCor of
Vancouver, Inc., a Tennessee corporation and wholly-owned subsidiary of the
Company ("PhyCor-Vancouver"), entered into a Service Agreement, effective as of
January 1, 1997 (the "Service Agreement"), with the Clinic. Pursuant to the
Service Agreement, PhyCor-Vancouver provides the Clinic with the equipment and
facilities used in the medical practice of the Clinic, manages Clinic operations
and employs the Clinic's non-medical personnel in exchange for a service fee.
The Service Agreement is for a term of 40 years and may only be terminated in
limited circumstances.
Plan of Distribution
This Supplement relates to the reoffering of the Shares by the Clinic. The
Shares will be distributed to the Physicians based on an election made by each
Physician to receive in Common Stock of the Company a portion of the proceeds to
be paid to such Physician pursuant to the Clinic's plan of distribution. The
Clinic may be deemed to be an "underwriter" within the meaning of Section 2(11)
of the Act, and any commissions received by (or discounts allowed to) it and any
profit on the reoffering of the Shares as principal may be deemed to be
underwriting discounts and commissions.
