8-K

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                       SECURITIES AND EXCHANGE COMMISSION

                              WASHINGTON, DC 20549

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                                    FORM 8-K

                 CURRENT REPORT PURSUANT TO SECTION 13 OR 15(D)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

        DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED): MARCH 22, 1999

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                                  RISCORP, INC.
             (Exact name of Registrant as specified in its Charter)

FLORIDA                           0-27462                    65-0335150
(State or Other                   (Commission                (IRS Employer
Jurisdiction of                   File No.)                  Identification No.)
Incorporation)

One Sarasota Tower, Suite 608
Sarasota, Florida
(Address of principal               34236
executive offices)                  (Zip Code)

       Registrant's telephone number, including area code: (941) 366-5015

          (Former Name or Former Address, if Changed Since Last Report)

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ITEM 5.  OTHER EVENTS

         On April 1, 1998, RISCORP, Inc. and certain of its subsidiaries
(collectively, "RISCORP" or the "Company") sold substantially all of their
assets and transferred certain liabilities to Zenith Insurance Company
("Zenith") pursuant to the terms of that certain Asset Purchase Agreement dated
June 17, 1997, as amended ("Asset Purchase Agreement"). In connection with this
sale, RISCORP ceased substantially all of its former business operations,
including its insurance operations.



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         In connection with the closing of this transaction, Zenith paid $35
million in cash, a portion of which was placed in escrow pursuant to the terms
of the Asset Purchase Agreement. The final purchase price to be paid by Zenith
is to be based on the Final Business Balance Sheet, as such term is defined in
the Asset Purchase Agreement, and is to be the amount by which the book value of
the transferred assets exceeded the book value of the liabilities assumed by
Zenith as of the closing date, subject to a $35 million minimum purchase price.
Due to the inability of the parties to mutually agree upon the Final Business
Balance Sheet for this transaction, a nationally recognized independent
accounting firm was engaged to serve as neutral auditors and neutral actuaries
(the "Independent Expert") to resolve the items in dispute and to determine the
Final Business Balance Sheet.

         On March 19, 1999, the Independent Expert issued its determination of
the Final Business Balance Sheet and, as such, its conclusion that the book
value of the transferred assets exceeded the book value of the transferred
liabilities assumed by Zenith at closing by $92.3 million. Therefore, pursuant
to the terms of the Asset Purchase Agreement, Zenith is required to pay an
additional $57.3 million in immediately available funds on or before March 26,
1999, plus interest thereon of 6.13% from April 1, 1998 through the final
payment date. Of this amount, $53.5 million, plus the interest component, is
required to be paid to RISCORP, and $3.8 million is required to be deposited
into escrow to secure RISCORP's indemnification obligations to Zenith. Based on
the decision of the Independent Expert, the total purchase price to be paid by
Zenith for the assets transferred at closing is $92.3 million, including the $35
million previously paid by Zenith. While the Company will report the Independent
Expert's determination in its 1998 consolidated financial statements, it
continues to evaluate the report, as well as the basis for the adjustments made
in connection with this determination.

         While engaged in the dispute resolution process for the determination
of the final purchase price, both RISCORP and Zenith provided notice to the
other party of various alleged breaches of the representations, warranties, or
covenants contained in the Asset Purchase Agreement and the occurrence of
various indemnifiable events for which each party has asserted its right to seek
indemnification. As a result of the parties' inability to resolve these and
other issues arising out of this transaction, on October 16, 1998, RISCORP and
certain of its subsidiaries filed a lawsuit against Zenith in federal court in
Tampa, Florida alleging a breach of the Asset Purchase Agreement. RISCORP
amended its complaint on January 25, 1999, and added ten additional claims
arising out of Zenith's failure to indemnify RISCORP for certain claims of third
parties. RISCORP also added two other claims, one for breach of contract and one
for conversion, related to Zenith's taking of $4.1 million RISCORP had on
deposit with the South Carolina Insurance Department.


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         On or about January 11, 1999, Zenith filed a lawsuit against RISCORP
and certain of its subsidiaries in federal court in New York setting forth
fourteen separate causes of action arising out of the Asset Purchase Agreement
and certain ancillary agreements. The complaint seeks an unspecified total
amount of damages, but the amount of compensatory damages sought is in excess of
$30 million, together with an unspecified amount of punitive damages and
attorneys' fees. Zenith's claims include, among others, that RISCORP (i)
breached certain representations and warranties set forth in the Asset Purchase
Agreement, (ii) failed to transfer certain assets to Zenith, (iii) failed to
operate its business in the ordinary course, (iv) failed to reimburse Zenith for
certain payments, and (v) fraudulently induced Zenith to execute the Asset
Purchase Agreement due to certain alleged verbal representations made with
respect to RISCORP's Year 2000 compliance.

         A copy of the press release issued by the Company with respect to the
foregoing matters is filed herewith as Exhibit 99 and is incorporated herein by
reference.

ITEM 7.  FINANCIAL STATEMENTS AND EXHIBITS

         The following exhibit is filed as a part of this report:


                      EXHIBIT NO.      DESCRIPTION
                                    
                      99               Press Release, dated March 22, 1999


                       NOTE ON FORWARD-LOOKING INFORMATION

         This report contains statements that constitute "forward-looking
statements" within the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities and Exchange Act of 1934, as amended.
The words "believe," "estimate," "expect," "intend," "anticipate," and similar
expressions and variations thereof identify certain of such forward-looking
statements, which speak only as of the dates on which they were made. RISCORP
undertakes no obligation to publicly update or revise any forward-looking
statements, whether as a result of new information, future events, or otherwise.
Readers are cautioned that any such forward-looking statements are not
guarantees of future performance and involve risks and uncertainties, and that
actual events may differ materially from those indicated in the forward-looking
statements as a result of various factors. Readers are cautioned not to place
undue reliance on these forward-looking statements or anticipated future events,
which are subject to a number of risks and uncertainties beyond the control of
the Company. These risks and uncertainties include but are not limited to the
following: (i) uncertainties with respect to the payment 


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by Zenith of the balance of the purchase price when due; (ii) uncertainties with
respect to the enforceability of the decision of the Independent Expert, (iii)
the inherent uncertainties associated with litigation, and (iv) other risks
detailed herein and from time to time in the RISCORP's other reports and filings
with the Securities and Exchange Commission.

                                    SIGNATURE

         Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, the Registrant has duly caused this report to be signed on its behalf
by the undersigned hereunto duly authorized.

                                            RISCORP, INC.

Dated:  March 22, 1999
                                            By: /s/ Walter E. Riehemann
                                                --------------------------
                                                Walter E. Riehemann
                                                VICE PRESIDENT & TREASURER
















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EX-99

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                                                                      EXHIBIT 99









                       PRESS RELEASE DATED MARCH 22, 1999


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                                 [PRESS RELEASE]


         SARASOTA, FL, March 22, 1999 - RISCORP, Inc., today announced that it
had been awarded an additional $57.3 million by an independent accounting and
actuarial firm retained by RISCORP and Zenith Insurance Company pursuant to the
Asset Purchase Agreement under which RISCORP sold substantially all of its
assets to Zenith in April 1998. This award, together with the $35 million
previously paid by Zenith, brings the total purchase price to $92.3 million.
Under the terms of the Asset Purchase Agreement, Zenith is required to pay the
additional amount by March 26, 1999, plus interest thereon of 6.13% per annum,
from April 1, 1998 through the payment date. Upon payment of the award by
Zenith, a total of $13.8 million will be held in escrow to secure any
indemnification obligations of RISCORP to Zenith for breaches of representations
and warranties contained in the Asset Purchase Agreement.

         The determination as to the additional purchase price to be paid by
Zenith was set forth in a report issued by the independent accountants and
actuaries. RISCORP continues to evaluate the report, as well as the basis for
the adjustments made in connection with this determination.

         Prior to the issuance of this determination, both RISCORP and Zenith
had filed separate causes of action alleging various breaches of the provisions
of the Asset Purchase Agreement. This litigation is proceeding.

                           FORWARD-LOOKING INFORMATION

         This press release contains statements that constitute "forward-looking
statements" within the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities and Exchange Act of 1934, as amended.
The words "believe," "estimate," "expect," "intend," "anticipate," and similar
expressions and variations thereof identify certain of such forward-looking
statements, which speak only as of the dates on which they were made. RISCORP
undertakes no obligation to publicly update or revise any forward-looking
statements, whether as a result of new information, future events, or otherwise.
Readers are cautioned that any such forward-looking statements are not
guarantees of future performance and involve risks and uncertainties, and that
actual events may differ materially from those indicated in the forward-looking
statements as a result of various factors. Readers are cautioned not to place
undue reliance on these forward-looking statements or anticipated future events,
which are subject to a number of risks and uncertainties beyond the control of
the Company. These risks and uncertainties include but are not limited to the
following: (i) uncertainties with respect to the payment by Zenith of the
balance of the purchase price when due, (ii) uncertainties with respect to the
enforceability of the decision of the Independent Expert, (iii) the inherent
uncertainties associated with litigation, and (iv) other risks detailed herein
and from time to time in RISCORP's other reports and filings with the Securities
and Exchange Commission.