<PAGE>   1
                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM 10-Q


(Mark One)

[X]          QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
                       SECURITIES EXCHANGE ACT OF 1934 For
                     the quarterly period ended May 31, 1998

                                       or

[ ]         TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
                         SECURITIES EXCHANGE ACT OF 1934
                        For the transition period from to

                        Commission File Number: 333-1742

                                    AMC, INC.
             (Exact name of registrant as specified in its charter)


               GEORGIA                                     58-2201031
      (State or other jurisdiction of      (I.R.S. Employer Identification No.)
      incorporation or organization)

              240 PEACHTREE ST., N. W.  SUITE 2200
              ATLANTA, GA                                          30303
              (Address of principal executive offices)             (Zip Code)

                                 (404) 220-2000
              (Registrant's telephone number, including area code)


         Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.    X  Yes     No
                                            ---     ---

                APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
                  PROCEEDINGS DURING THE PRECEDING FIVE YEARS:

         Indicate by check mark whether the registrant has filed all documents
and reports required to be filed by Sections 12, 13 or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court     Yes     No
                     ---      ---

         As of July 1, 1998, the Registrant has 62,173,154 shares of common
stock, par value $1.00 per share outstanding.


<PAGE>   2




                         PART 1 - FINANCIAL INFORMATION

ITEM 1.       FINANCIAL STATEMENTS.

                           AMC, INC. AND SUBSIDIARIES
                      CONDENSED CONSOLIDATED BALANCE SHEETS
                                   (UNAUDITED)


<TABLE>
<CAPTION>
                                                     May 31,         August 31, 
                                                     1998                1997
                                                  ------------      ------------
<S>                                               <C>               <C>         
                               ASSETS
Current assets:
   Cash                                           $    555,527      $    520,854
   Restricted cash                                   3,435,890         2,598,375
   Restricted escrow deposits                        3,825,677         4,510,529
   Accounts and notes receivable                     2,769,917         2,845,294
   Deferred income taxes                             1,819,528         2,425,495
   Other current assets                              1,701,682           467,078
                                                  ------------      ------------
     Total current assets                           14,108,221        13,367,625

Commercial property                                325,939,638       333,615,976
Less accumulated depreciation                      132,209,665       136,636,802
                                                  ------------      ------------
   Net commercial property                         193,729,973       196,979,174
Notes receivable, less current maturities              469,542           939,080
Deferred income taxes                               12,338,611        17,319,644
Investment in limited partnerships                   6,414,114                --
Other non current assets                               541,862           915,159
                                                  ============      ============
                                                  $227,602,323      $229,520,682
                                                  ============      ============

  LIABILITIES AND STOCKHOLDERS' DEFICIT Current liabilities:

Current portion of long-term debt                 $ 14,400,000      $ 14,400,000
   Accounts payable and accrued expenses             7,025,500        11,712,664
   Deferred revenue                                  6,686,482         1,901,022
                                                  ------------      ------------
     Total current liabilities                      28,111,982        28,013,686

Long-term debt, less current portion               280,941,872       294,665,115
Revolving line of credit                             5,124,381         3,079,804
Other non current liabilities                        3,311,648         3,070,577
                                                  ------------      ------------
   Total liabilities                               317,489,883       328,829,182
                                                  ------------      ------------

Stockholders' deficit:
   Common stock - $1 par value,
     100,000,000 shares
     authorized, 62,173,154 shares
     issued and outstanding                         62,173,154        62,173,154
   Capital deficit                                (172,660,875)     (172,660,875)
   Retained earnings                                20,600,161        11,179,221
                                                  ------------      ------------
   Total stockholders' deficit                     (89,887,560)      (99,308,500)
                                                  ============      ============
                                                  $227,602,323      $229,520,682
                                                  ============      ============
</TABLE>

     See accompanying notes to condensed consolidated financial statements.

                                      I-1

<PAGE>   3



                           AMC, INC. AND SUBSIDIARIES
      CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND RETAINED EARNINGS
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                   Three months ended May 31,
                                                -------------------------------
                                                    1998                1997
                                                ------------       ------------
<S>                                             <C>                <C>         
Revenues:
   Rental                                       $ 13,811,814       $ 12,649,496
   Trade shows                                     1,007,187          1,020,931
   Other revenues                                    616,751            775,138
                                                ------------       ------------
Total revenues                                    15,435,752         14,445,565

Operating expenses:
   Building operations                             2,083,491          1,862,273
   Trade shows                                       258,382            293,018
   Marketing                                         431,263            614,000
   General and administrative                      4,038,038          4,481,441
   Bad debt recovery                                 (50,937)           (20,858)
   Property taxes                                  1,270,461          1,277,412
   Depreciation and amortization                   3,283,200          3,436,140
                                                ------------       ------------
Total operating expenses                          11,313,898         11,943,426
                                                ------------       ------------
Operating income                                   4,121,854          2,502,139

Other (income) expenses:
   Interest expense                                2,086,616          2,056,733
   Interest income                                  (104,901)          (117,786)
   Gain on limited partnership interests          (2,387,248)                --
   Other expense                                     332,474          1,163,310
                                                ------------       ------------
Total other (income) expenses, net                   (73,059)         3,102,257
                                                ------------       ------------

Income (loss) before income taxes                  4,194,913           (600,118)
Deferred income tax expense (benefit)              1,464,000           (217,000)
                                                ------------       ------------
Net income (loss)                                  2,730,913           (383,118)
Retained earnings at beginning of period          17,869,248          9,994,560
                                                ------------       ------------
Retained earnings at end of period              $ 20,600,161       $  9,611,442
                                                ============       ============
Net income (loss) per share - basic             $        .04       $       (.01)
                                                ============       ============
Net income (loss) per share - diluted           $        .04       $       (.01)
                                                ============       ============
</TABLE>


     See accompanying notes to condensed consolidated financial statements.


                                      I-2


<PAGE>   4



                           AMC, INC. AND SUBSIDIARIES
      CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND RETAINED EARNINGS
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                    Nine months ended May 31,
                                                -------------------------------
                                                     1998               1997
                                                ------------       ------------
<S>                                             <C>                <C>         
Revenues:
   Rental                                       $ 40,201,188       $ 36,713,428
   Trade shows                                    10,300,166          9,467,527
   Other revenues                                  2,681,779          2,990,757
                                                ------------       ------------
Total revenues                                    53,183,133         49,171,712

Operating expenses:
   Building operations                             6,257,103          5,972,336
   Trade shows                                     2,023,027          1,698,213
   Marketing                                       3,604,767          3,282,126
   General and administrative                     12,486,140         12,828,573
   Bad debt expense                                  101,467            162,237
   Property taxes                                  3,462,862          3,554,184
   Depreciation and amortization                   9,720,082         10,197,746
                                                ------------       ------------
Total operating expenses                          37,655,448         37,695,415
                                                ------------       ------------
Operating income                                  15,527,685         11,476,297

Other (income) expenses:
   Interest expense                                6,270,215          6,280,061
   Interest income                                  (311,363)          (340,251)
   Gain on limited partnership interests          (6,026,215)                --
   Other expense                                     587,108          1,757,643
                                                ------------       ------------
Total other expenses, net                            519,745          7,697,453
                                                ------------       ------------

Income before income taxes                        15,007,940          3,778,844
Deferred income tax expense                        5,587,000          1,468,000
                                                ------------       ------------
Net income                                         9,420,940          2,310,844
Retained earnings at beginning of period          11,179,221          7,300,598
                                                ------------       ------------
Retained earnings at end of period              $ 20,600,161       $  9,611,442
                                                ============       ============
Net income per share - basic                    $        .15       $        .04
                                                ============       ============
Net income per share - diluted                  $        .15       $        .04
                                                ============       ============
</TABLE>


     See accompanying notes to condensed consolidated financial statements.



                                      I-3

<PAGE>   5



                           AMC, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                 FOR THE NINE MONTHS ENDED MAY 31, 1998 AND 1997
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                                       Nine months ended May 31,
                                                                    -------------------------------
                                                                        1998               1997
                                                                    ------------       ------------

<S>                                                                 <C>                <C>         
Net income                                                          $  9,420,940       $  2,310,844
Adjustments to reconcile net income to net cash provided by
operating activities
   Depreciation and amortization                                       9,720,082         10,197,746
   Deferred income tax expense                                         5,587,000          1,468,000
   Gain on limited partnership interests                              (6,026,215)                --
   Decrease in accounts and notes receivables                             49,152          1,760,766
   Decrease (increase) in other current and non current assets          (869,551)           398,842
   Decrease in accounts payable and accrued expenses                  (5,075,069)          (228,068)
   Increase in deferred revenue                                        4,785,461          4,559,446
   Increase (decrease) in other non current liabilities                  241,075            (81,322)
                                                                    ------------       ------------
Net cash provided by operating activities                             17,832,875         20,386,254

Cash flows from investing activities:
   Principal repayments of notes receivable                              469,538            469,538
   Additions to commercial property                                   (6,436,411)        (7,674,328)
   Increase in restricted cash                                          (837,515)           (62,487)
                                                                    ------------       ------------
Net cash used in investing activities                                 (6,804,388)        (7,267,277)

Cash flows from financing activities:
   Decrease (increase) in restricted escrow deposits                     684,852         (2,400,989)
   Net increase in revolving line of credit                            2,044,577          1,271,108
   Principal payments of AMM Escrow Bonds                                     --           (512,703)
   Mart Bond payments                                                (10,800,000)        (9,000,000)
   Principal repayments of Gift Mart Mortgage Loan                    (2,923,243)        (3,031,402)
                                                                    ------------       ------------
Net cash used in financing activities                                (10,993,814)       (13,673,986)
                                                                    ------------       ------------

Increase (decrease) in cash                                               34,673           (555,009)
Cash at beginning of period                                              520,854          1,052,082
                                                                    ------------       ------------
Cash at end of period                                               $    555,527       $    497,073
                                                                    ============       ============

Supplemental disclosure -
Cash paid during the period for interest                            $  6,183,977       $  6,146,233
                                                                    ============       ============

Non-cash distribution of limited partnership interest               $  6,414,114       $          -
                                                                    ============       ============
</TABLE>

     See accompanying notes to condensed consolidated financial statements.


                                      I-4
<PAGE>   6



                           AMC, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                  MAY 31, 1998
                                   (UNAUDITED)

(1)      BASIS OF PRESENTATION

The accompanying unaudited condensed consolidated financial statements of AMC,
Inc. and Subsidiaries (the "Company") have been prepared in accordance with
generally accepted accounting principles for interim financial information and
with the instructions to Form 10-Q and Article 10 of Regulation S-X.
Accordingly, they do not include all of the information and footnotes required
by generally accepted accounting principles for complete financial statements.
In the opinion of management, all adjustments (consisting of normal recurring
accruals) considered necessary for a fair presentation have been included.
Operating results for the nine months ended May 31, 1998 are not necessarily
indicative of the results that may be expected for the year ended August 31,
1998. For further information, refer to the consolidated financial statements
and footnotes thereto included in the AMC, Inc. and Subsidiaries' annual report
on Form 10-K for the year ended August 31, 1997.

Certain prior year amounts have been reclassified to conform to the current
period presentation.

(2)      CONTINGENT MATTERS

On April 19, 1993, a former employee of AMCMC (predecessor company) filed suit
against AMCMC for breach of contract and related tort claims. On January 19,
1996, the trial court granted summary judgment in favor of the Company on all
counts. On March 5, 1997, the Georgia Court of Appeals reversed the trial court,
and directed that judgment be entered in favor of the former employee on the
breach of contract count and remanded the case for trial on the tort claims. The
amount awarded for the breach of contract claim for damages and interest was
accrued at August 31, 1997. The Georgia Supreme Court granted the Company's
petition requesting a review of the Court of Appeals decision. On July 13, 1998
the Supreme Court issued its opinion, affirming the summary judgement on the
breach of contract claim, but ruling in favor of the Company on the tort
claims. The Company has no present intention to seek further review of the
breach of contract holding, and the Supreme Court's ruling is expected to
conclude the matter.

The Company is subject to certain other claims in the ordinary course of
business. Management does not expect that the resolution of such claims will
have a material impact on the Company's financial position or results of
operations.

(3)       SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

In 1997, the Financial Accounting Standards Board issued Statement of Financial
Accounting Standards ("SFAS") No. 128, Earnings Per Share. SFAS 128 replaced the
previously reported primary and fully diluted earnings per share with basic and
diluted earnings per share. Unlike primary earnings per share, basic earnings
per share excludes the dilutive effects of options, warrants and convertible
securities. Diluted earnings per share is very similar to the previously
reported fully diluted earnings per share. All earnings per share amounts for
all periods have been presented, and where necessary, restated to conform to the
SFAS 128 requirements.

(4)       COMMERCIAL PROPERTY

In December 1997 the Company wrote off approximately $14,113,000 in assets which
were fully depreciated.


                                      I-5
<PAGE>   7




(5)       INVESTMENT IN LIMITED PARTNERSHIPS

The Company, through its wholly owned subsidiary EC Holdings, Inc. ("EC
Holdings") owns limited partnership interests in partnerships owning real estate
in two mixed use complexes in San Francisco's financial district. These
interests currently include six office buildings, retail and associated parking.
In February 1998 and May 1998, two of the partnerships sold hotel properties for
an agreed upon number of units in other limited partnerships. The Company's
share of the units, which were distributed to EC Holdings, have a fair value of
approximately $6,414,000 and have been recorded as an investment in limited
partnerships. The units are pledged as security for the Antecedent Debt Notes.
The gain of $6,026,000 recorded by the Company is net of certain related costs.
The Company records its investments in limited partnerships using the cost
method of accounting.

(6)       REVOLVING LINE OF CREDIT

On May 31, 1998, with the approval of the requisite bondholders, the Company's
Revolving Line of Credit was amended to increase the maximum revolving
commitment from $10,000,000 to $20,000,000 and to extend the maturity date to
May 31, 2001. Under the terms of the amendment, the Revolving Line of Credit
bears interest at the prime rate or LIBOR plus 2.10% at the Company's option,
payable monthly. In addition, a commitment fee of .375% per annum on the daily
unused portion of the Revolving Line of Credit is payable quarterly in arrears.
Amounts under the Revolving Line of Credit are available for general corporate
use, including operating expenses, working capital, capital improvements, debt
service and acquisitions. Under certain circumstances, the usage of the
Revolving Line of Credit may require the prior approval of one of the Company's
bondholders.

(7)       COMMON STOCK

In May 1998, the Company issued 210,403 shares of common stock which were
issuable as a result of the restructuring which had not been previously issued
or reflected in common stock. The issuance was recorded as an adjustment to
common stock and capital deficit. Prior period balances and earnings per share
have been restated to reflect the issuance of the common stock.
















                                      I-6
<PAGE>   8



ITEM 2.       MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND 
              RESULTS OF OPERATIONS.

GENERAL

Effective October 2, 1995, Mr. John C. Portman, Jr. and The Portman Companies
entered into a series of agreements with their lenders to restructure their
existing indebtedness. Under the terms of these agreements, the net assets of
the Atlanta Market Center Companies were contributed to AMC, Inc., which had
been formed principally for such purpose. In exchange for the existing debt
reduced by certain amounts forgiven by the lenders, the creditors of Mr. Portman
and certain affiliates, including the creditors of the Company, received
approximately 82.5% of the equity interest in the Company, the Mart Bonds, the
AMM Escrow Bonds, and the Antecedent Debt Notes.

This restructuring has been accounted for as a troubled debt restructuring in
accordance with Statement of Financial Accounting Standards No. 15, "Accounting
by Debtors and Creditors for Troubled Debt Restructurings" (SFAS 15). As a
result of this troubled debt restructuring, in which the existing debt at the
time of the restructure exceeded the fair value of the equity interests issued
and the total future principal and interest payments called for under the Mart
Bonds, the Mart Bonds have initially been recorded at an amount equal to the
total future cash payments, including interest, specified by their terms in
accordance with SFAS 15. All future cash payments will be accounted for as a
reduction of the carrying amount of the Mart Bonds, and no interest expense will
be recognized on the Mart Bonds.

The Company's primary business is the operation of AmericasMart and the
management of trade shows in conjunction with such Marts. Additionally, the
Company manages trade shows on behalf of third parties at other locations.

The following discussion and analysis of the financial condition and results of
operations of the Company should be read in conjunction with the unaudited
condensed consolidated financial statements and related notes of the Company
included elsewhere in this report and the AMC, Inc. and Subsidiaries' annual
report on Form 10-K for the year ended August 31, 1997.

RESULTS OF OPERATIONS

The Company's principal sources of revenues are rental revenues from the lease
of showroom and exhibition space in AmericasMart and trade show revenues, which
relate to specific shows staged for related industries. The Company leases
showroom space over terms ranging from one to ten years with rent payable
monthly over the term of the lease. In addition, the Company rents exhibition
space during trade shows thereby affording non-tenant manufacturers an
opportunity to exhibit merchandise during a specific trade show.

Quarter Ended May 31, 1998 Compared to Quarter Ended May 31, 1997

Rental revenues increased approximately $1,162,000 during the quarter ended May
31, 1998 ("Q3 1998") as compared to the quarter ended May 31, 1997 ("Q3 1997").
Rental revenues increased approximately $332,000 in the Gift Mart due to an
increase in rental rates offset by a slight decrease in occupancy. Rental
revenues increased approximately $1,054,000 in the Merchandise Mart, reflecting
an increase in both occupancy and rental rates, primarily associated with the
Holiday and Floral area which opened in January 1997 and was expanded in January
1998. Rental revenues in the 

                                      I-7

<PAGE>   9

Apparel Mart decreased approximately $224,000 reflecting a decrease in occupancy
and in rental rates.

Trade show revenues decreased approximately $14,000 in Q3 1998 compared to Q3
1997. Other revenues decreased approximately $158,000 in Q3 1998 compared to Q3
1997 due primarily to a decrease in hotel commissions and certain joint venture
revenues.

Building operations expenses increased approximately $221,000 in Q3 1998
compared to Q3 1997 due primarily to increased electrical and building
maintenance costs.

Trade show expenses decreased approximately $35,000 in Q3 1998 compared to Q3
1997 due primarily to costs associated with the March Gift Show.

Marketing expenses decreased approximately $183,000 in Q3 1998 compared to Q3
1997 due primarily to a decrease in costs associated with the apparel markets.

General and administrative expenses decreased approximately $443,000 in Q3 1998
compared to Q3 1997 as a result of a decrease in certain professional service
costs, offset by an increase in salary and benefit costs.

Bad debt recovery increased approximately $30,000 in Q3 1998 compared to Q3 1997
due to the collection of accounts previously considered uncollectible.

Depreciation and amortization expense decreased approximately $153,000 in Q3
1998 compared to Q3 1997 due to certain assets becoming fully depreciated in
1998.

The increase in operating income of approximately $1,620,000 in Q3 1998 as
compared to Q3 1997 is primarily due to the increase in rental and trade show
revenues and the decrease in general and administrative expense.

The gain on limited partnership interest results from the sale of a hotel
property in which the Company had an interest and the distribution of
partnership units to EC Holdings in May 1998 as a result of the sale.

Other expense in Q3 1997 included the write-off of a related party note
receivable as well as certain litigation costs that were not incurred in Q3
1998.

Income tax expense increased approximately $1,681,000 in Q3 1998 compared to Q3
1997 due to the increase in taxable income.

Nine months Ended May 31, 1998 compared to Nine Months Ended May 31, 1997.

Rental revenues increased approximately $3,488,000 during the nine months ended
May 31, 1998 ("YTD 1998") as compared to the nine months ended May 31, 1997
("YTD 1997"). Rental revenues increased approximately $735,000 in the Gift Mart
due to an increase in rental rates offset by a decrease in occupancy. Rental
revenues increased $3,783,000 in the Merchandise Mart, reflecting an increase in
both occupancy and rental rates primarily associated with the Holiday and Floral
area which opened in January 1997 and was expanded in January 1998. Rental
revenues in the Apparel Mart decreased approximately $1,030,000 reflecting a
decrease in occupancy and in rental rates.


                                      I-8
<PAGE>   10

Trade show revenues increased approximately $833,000 in YTD 1998 compared to YTD
1997 primarily due to an increase in January International Gift and Home
Furnishings Market revenues and the addition of the Florida Gift Show. Other
revenues decreased approximately $309,000 for YTD 1998 compared to YTD 1997 due
to decreases in certain joint venture revenues and transient parking revenues,
offset by an increase in hotel commission and advertising revenues.

Building operations expenses increased approximately $285,000 for YTD 1998
compared to YTD 1997 due primarily to increased electrical and building
maintenance costs.

Trade show expenses increased approximately $325,000 for YTD 1998 compared to
YTD 1997 due primarily to costs associated with the addition of the Florida Gift
Show.

Marketing expenses increased approximately $323,000 in YTD 1998 compared to YTD
1997 due primarily to an increase in costs associated with the January
International Gift and Home Furnishings Market and the addition of the Florida
Gift Show.

General and administrative expenses decreased approximately $342,000 in YTD 1998
compared to YTD 1997 as a result of a decrease in certain professional service
costs offset by an increase in salary and benefit costs.

Property taxes decreased approximately $91,000 in YTD 1998 compared to YTD 1997
due to a decrease in the property tax assessment.

Depreciation and amortization expense decreased approximately $478,000 in YTD
1998 compared to YTD 1997 due to certain assets becoming fully depreciated in
1998.

The increase in operating income of $4,051,000 in YTD 1998 compared to YTD 1997
is primarily due to the increase in rental revenues.

Other expense decreased approximately $1,170,000 in YTD 1998 compared to YTD
1997 as a result of Olympic costs, the write-off of a related party note and
certain litigation costs incurred in YTD 1997 that were not incurred in YTD
1998.

The gain on limited partnership interests results from the sale of hotel
properties in which the Company had an interest and the distribution of
partnership units to EC Holdings in February 1998 and May 1998 as a result of
the sales.

Income tax expense increased approximately $4,119,000 in YTD 1998 compared to
YTD 1997 due to the increase in taxable income.

LIQUIDITY AND CAPITAL RESOURCES

At May 31, 1998, the Company had approximately $280.9 million in long-term debt
outstanding, of which approximately $95.6 million represents the Gift Mart
Mortgage Loan. Additionally, approximately $5.1 million was outstanding under
the Revolving Line of Credit at May 31, 1998.

The Company's primary sources of cash are operating cash flows and borrowings
under the Revolving Line of Credit. On May 31, 1998, with the approval of the
requisite bondholders, the Company's Revolving Line of Credit was amended to
increase the maximum revolving commitment from $10.0 million to $20.0 million
and to extend the maturity date to May 31, 2001. Amounts under


                                      I-9
<PAGE>   11

the Revolving Line of Credit are available for general corporate use, including
operating expenses, working capital, capital improvements, debt service and
acquisitions. The Company intends to use the increased availability under the
Revolving Line of Credit to fund the early expansion of the Gardens line of
business, for working capital purposes, and for an additional liquidity reserve.
Under certain circumstances, the usage of the Revolving Line of Credit may
require the prior approval of one of the Company's bondholders. At May 31, 1998
approximately $14.9 million was available under the Revolving Line of Credit.

The availability of operating cash flows generated by the Gift Mart is limited
by the terms of the Gift Mart Mortgage Loan. Cash flows from operations less
capital improvements of the Gift Mart must be used to repay principal
outstanding on the Gift Mart financing and cannot be used to fund operations or
capital improvements of other properties of the Company. Principal payments on
the Gift Mart financing totaled $2.9 million and $3.0 million for YTD 1998 and
YTD 1997, respectively.

Cash flows from operations, net of cash flows of the Gift Mart, were
approximately $13.4 million during YTD 1998, and $16.1 million during YTD 1997.
The decrease in operating cash flow in YTD 1998 compared to YTD 1997 is
primarily attributable to the timing of the payment of property taxes.

Significant capital expenditures were incurred during the past several years and
ongoing capital expenditures will be necessary to adequately maintain the
Company's properties. Total capital expenditures were approximately $6.4 million
in YTD 1998, and $7.7 million in YTD 1997, which included approximately $.7
million and $.4 million in Gift Mart capital expenditures for YTD 1998 and YTD
1997, respectively. Except as discussed below, management expects that capital
expenditures, including tenant improvements, of approximately $11.0 million will
be needed to maintain the buildings and make improvements, including
improvements related to possible increased rental activity, during the year
ending August 31, 1998. There can be no assurance, that changes in the
competitive environment, governmental regulations or unforeseen loss or damage
will not cause capital expenditures to exceed management's estimate.

Management expects that cash flows from operations and borrowings under the
Revolving Line of Credit will be sufficient to fund operations, debt service
prior to maturity and approved capital expenditures provided that the Company
can maintain its operating revenues and expenses at current levels and that no
unforeseen or additional significant capital improvements are required. There
can be no assurance the Company can maintain current revenue levels which are
affected by changing economic conditions in the specific industries represented
at its Marts and trade shows. In addition, there can be no assurance that the
overall level of capital expenditures will not increase as the Marts age. In the
event that operating cash flows and borrowings under the Revolving Line of
Credit are insufficient, the Company would be required to seek additional
financing or to refinance all of its debt obligations prior to maturity. The
Company's ability to seek additional financing is limited under the terms of the
Revolving Line of Credit and its indentures.

Under the terms of the Mart Bonds, the Company is required to use certain
portions of its cash flows to repay its indebtedness. The terms of such debt
also limit the Company's ability to incur additional debt or to create
additional liens. Accordingly, such provisions may limit the Company's ability
to make required capital improvements. Mart Bond repayments totaled
approximately $10.8 million in YTD 1998, and $9.0 million in YTD 1997. Principal
payments to reduce the indebtedness under the Gift Mart financing and the Mart
Bonds will be determined based upon cash flows of the Gift Mart and of the
Company, respectively.


                                      I-10
<PAGE>   12

In February 1998, one of the holders of the Mart Bonds offered to purchase for
cash a portion of the outstanding Mart Bonds. This offer has expired and it is
the understanding of the Company that none of the outstanding Mart Bonds were
purchased pursuant to this offer. In connection with the offer, the offeror
indicated that it intended to engage in discussions with the Company regarding
the refinancing of the Mart Bonds and that another holder also intends to engage
in such discussions with the Company. While the Company has from time to time
engaged in preliminary discussions with certain holders of the Mart Bonds
regarding the refinancing of those Bonds and possible arrangements under which
the Company or its affiliates would participate in repurchase of the Mart Bonds,
neither the Company nor any of its affiliates is currently a party to any
agreement, understanding or arrangement with respect to the refinancing of the
Mart Bonds or with respect to any repurchase by the Company of the Mart Bonds or
any other securities of the Company.

The remaining principal balance on the Gift Mart financing is due on July 31,
1998, with an option to extend the maturity date for one year, if specified
performance levels are achieved. The Company expects such levels to be achieved
and plans to extend the maturity of the debt. The Company's Mart Bonds are due
and payable on July 31, 2000. The Company will not generate sufficient cash to
repay such indebtedness and intends to refinance both of these debt obligations
at maturity by extending their maturity dates or securing other financing. There
can be no assurance that the Company will be able to extend the maturity dates
of any of its indebtedness or secure alternative financing to fund the repayment
thereof.

The Company has engaged a financial advisor to assist the Company in the
identification and evaluation of strategic alternatives that may include certain
transactions designed to maximize the value of the Company. The possible
transactions could include a capital restructuring, asset repositioning or a
sale of the Company or certain of its assets, in either a single transaction or
a series of related transactions. Other assets of affiliates of the Company
could be included in any such transaction or series of transactions. There can
be no assurance that the financial advisor will formulate any strategic
alternative to maximize the value of the Company or that the Company will
succeed in completing any transaction or series of transactions recommended by
the financial advisor. The fees for the services provided by the financial
advisor, including any success fees which may become payable, will be borne pro
rata by the Company and the affiliates of the Company, as provided in a separate
agreement between the Company and its affiliates. Under this agreement, based on
their respective EBITDAs for 1997, the Company will contribute approximately 71%
of fees and expenses, with any success fee that becomes payable to be based on
the value of the respective parties' assets. The agreement with the financial
advisor provides for an initial retainer fee of $250,000 and monthly fees of
$50,000 per month for a minimum of twelve months.

EC Holdings

The stock representing the Company's interests in EC Holdings, Inc. ("EC
Holdings"), which holds an interest in limited partnerships which own two
mixed-use complexes in San Francisco's financial district, and certain
unimproved land (the "Unimproved Land") has been pledged as security for the
Antecedent Debt Notes. Under the terms of the Antecedent Debt Notes, since the
Company did not liquidate its interest in EC Holdings or the Unimproved Land by
October 2, 1997, the Antecedent Debt Note holders are entitled to direct the
trustee for the bonds to foreclose upon the Company's interest in EC Holdings
and the Unimproved Land. As of July 1, 1998, no foreclosure proceedings have
been initiated.

The limited partnership interests held by EC Holdings currently have interests
in six office buildings, retail and associated parking. In February 1998 and May
1998, two of the partnerships sold hotel 


                                      I-11
<PAGE>   13

properties for an agreed upon number of units in other limited partnerships. The
Company's share of the units, which were distributed to EC Holdings, have a fair
value of approximately $6,414,000 and have been recorded as an investment in
limited partnerships. The units are pledged as security for the Antecedent Debt
Notes.

 All other properties in which EC Holdings has interests are currently under an
agreement to be sold to Boston Properties Limited Partnership ("BPLP") in
exchange for a combination of preferred limited partnership units of BPLP and
cash. If the transaction closes as proposed, it is expected to result in a gain
to the Company, before related transaction costs, which could exceed $25
million. The transaction, which is proposed to close in the fourth quarter, is
subject to further negotiation, due diligence by the parties and the preparation
of mutually acceptable definitive documentation. There can be no assurance that
the transaction will be completed or that the transaction will be completed as
proposed.

Any cash distributions to EC Holdings or cash received upon the sale of limited
partnership units must first be used to pay down the Antecedent Debt and the
Revolving Line of Credit. The use of any additional cash distributions is
limited under the terms of the Company's debt agreements.

INFLATION

The Company deals with the effects of inflation by adjusting rental rates on new
leases and renewal leases, and by providing for annual rental rate increases in
most leases. In times of higher inflation, the Company's operating results are
negatively impacted due to the fact that most lease terms are from one to ten
years while the term of most service contracts is one year or less.

YEAR 2000 INFORMATION

The Company has assessed the potential impact of the Year 2000 computer systems
issue on its operations. Based upon preliminary assessments, the Company's
accounting system is the primary system which is currently not Year 2000
compliant. An upgraded version of the software which is Year 2000 compliant will
be installed by November 1998. All other system changes or upgrades which are
required to ensure Year 2000 compliance will be implemented by the end of fiscal
year 1999. It is management's belief that the impact of the issue will not
materially affect the Company's future operating results or financial condition.







                                      I-12

<PAGE>   14





                           PART II - OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS

         See note 2 to Part 1, Item 1 - Financial Statements.

ITEM 2.  CHANGES IN SECURITIES

         None.

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES

         None.

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

         None.

ITEM 5.  OTHER INFORMATION

         None.

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K.

         (a)   Exhibits

<TABLE>
         <S>      <C>         
         4.1      First Amendment to Credit Agreement dated as of May 31, 1998,
                  by and among AMC, Inc. and the Provident Bank and various
                  lenders.

         4.2      Amended and Restated Revolving Credit Note dated May 31, 1998.

         4.3      First Amendment to Intercreditor Agreement dated as of May 31,
                  1998 by and among The Provident Bank, as agent, and Reliance
                  Trust Company in its capacity as trustee.

         4.4      Second Amendment to Indenture dated as of May 31, 1998 by and
                  between AMC, Inc. and Reliance Trust Company, as Trustee.

         4.5      Modification to Deed to Secure Debt and Security Agreement
                  dated as of May 31, 1998 by AMC, Inc. and the Provident Bank
                  as agent for the various lenders.

         10.1     Agreement dated April 8, 1998 among AMC, Inc., Portman
                  Lightfair Associates, L.P., CGS Associates, L.P., AMC Orlando,
                  Inc. and ADAC, L.P. regarding the engagement of Victor Capital
                  Group, L.P. 

         10.2     Agreement dated April 7, 1998 regarding the engagement of
                  Victor Capital Group, L.P. by AMC, Inc. for itself and as
                  agent for Portman Lightfair Associates, L.P., CGS Associates,
                  L.P., AMC Orlando, Inc. and ADAC, L.P. 

         11       Computation of Earnings Per Common Share 

         27       Financial Data Schedule
</TABLE>

    (b)  The Company has not filed any reports on Form 8-K during the quarter
         ended May 31, 1998 or subsequent to that date but prior to the filing
         date of this Form 10-Q.

                                      II-1

<PAGE>   15





                                   SIGNATURES

         Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.

                                   AMC, Inc.
                                   (Registrant)


                                   /S/ JOHN M. RYAN
                                   ----------------
                                   John M. Ryan
                                   President



                                   /S/ HENRY G. ALMQUIST, JR.
                                   --------------------------
                                   Henry G. Almquist, Jr.
                                   Sr. Vice President - Finance and
                                   Accounting, Chief Financial Officer
                                   (Principal financial and accounting officer)


Date:    July 14, 1998