SEC Filings

10-12G
AMSURG CORP filed this Form 10-12G on 03/11/1997
Entire Document
 
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assurance AmSurg can compete effectively with such entities. See "BUSINESS OF
AMSURG -- Competition."
 
     RISK FACTORS REGARDING AHC AFTER DISTRIBUTION.  A material portion of AHC's
operating revenues and revenue growth was generated by AmSurg prior to the
Distribution. After the Distribution, AHC's business will consist of its
hospital-based diabetes treatment services business, the comprehensive
management of diabetes care for managed care organizations and other third-party
payors and the operation of arthritis and osteoporosis treatment centers. In the
last fiscal year, revenues from this business have been adversely affected by
termination of certain hospital contracts and development and implementation
costs applicable to DTCA's development of comprehensive diabetes disease
management products for the managed care industry. AHC's ability to generate
revenues and profits from its diabetes disease management contracts with managed
care organizations and other third-party payors is dependent primarily on its
ability to reduce overall healthcare costs for individuals with diabetes while
improving clinical outcomes for these individuals. While AHC believes that it
can reduce the healthcare costs and improve clinical outcomes for individuals
with diabetes through effective management of the disease, AHC's ability to
produce the anticipated improvements in care and cost savings and thus operate
these contracts in a manner that will produce profitability for AHC has not yet
been established, because AHC's comprehensive healthcare management contracts
for people with diabetes are believed to be the first of this type in the
industry and have only been recently implemented or are in the process of being
implemented. During fiscal 1996, 13 DTCA contracts for hospital services were
discontinued or not renewed. Certain hospitals faced with pressures to make
immediate cost reductions have decided to eliminate DTCA's treatment programs.
While AHC believes this business is stabilizing, the general uncertainties
associated with changes taking place in the healthcare industry and DTCA's
client hospitals' reactions to the changes in the industry may continue to
adversely affect revenues and contract retention in future periods. See
"BUSINESS OF AHC AFTER DISTRIBUTION."
 
     Other risks associated with the business of AHC include regulatory risks
for the healthcare industry as a whole, efforts by hospitals and third party
payors to reduce costs, unusual and unforeseen patterns of healthcare
utilizations by individuals with diabetes in the managed care organizations with
which DTCA has executed an agreement, the ability or inability of such managed
care organizations to maintain the covered lives in the plans serviced by DTCA
and the ability or inability of DTCA to attract, retain and effectively manage
the employees required to implement the agreements with managed care
organizations.
 
     Following the Distribution, for a period of two years, Thomas G. Cigarran,
the Chairman and Chief Executive Officer of AHC and Henry D. Herr, the Chief
Financial Officer and a director of AHC, will provide advisory services to
AmSurg. The services, while limited in scope, may impact the amount of time
Messrs. Cigarran and Herr are able to devote to the business of AHC during this
period. See "CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS -- Advisory
Agreements."
 
     EFFECT OF THE DISTRIBUTION ON THE AHC COMMON STOCK.  After the
Distribution, the AHC Common Stock will continue to be traded on the Nasdaq
National Market. As a result of the Distribution, AHC will no longer own any
AmSurg Common Stock and accordingly its balance sheet and income statement will
no longer reflect the assets and operation of AmSurg. AHC will be entirely
dependent upon the operation of DTCA and AOCC for its earnings and, as a result,
the trading prices of AHC Common Stock are expected to be lower than the trading
prices of AHC Common Stock immediately prior to the Distribution and such
trading prices may also be more volatile than they were prior to the
Distribution. The combined trading prices of AHC Common Stock and Class A Common
Stock after the Distribution may be less than, equal to or greater than the
trading prices of AHC Common Stock prior to the Distribution.
 
     CERTAIN FEDERAL INCOME TAX CONSIDERATIONS.  AHC has conditioned the
Distribution on the receipt of a ruling from the IRS to the effect that, among
other things, the Distribution will be substantially tax-free under Section 355
of the Code. Approximately 1.5% of the shares of AmSurg Common Stock distributed
in the Distribution will be subject to federal income taxation. In addition,
cash received in lieu of fractional share interests in the AmSurg Common Stock
will generally be taxable to recipients. The continuing validity of the IRS
ruling will be subject to certain factual representations and assumptions. If
such factual representations and assumptions were incorrect in a material
respect, the ruling would be jeopardized. AHC is not aware of
 
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