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PARTNERS HEALTH PLAN OF PENNSYLVANIA, INC.
5700 CORPORATION DRIVE, SUITE 300
PITTSBURGH, PENNSYLVANIA 15237
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INFORMATION STATEMENT PURSUANT TO SECTION 14(F)
OF THE SECURITIES EXCHANGE ACT OF 1934
AND RULE 14F-1 THEREUNDER
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NO VOTE OR OTHER ACTION OF THE COMPANY'S
SHAREHOLDERS IS REQUIRED IN CONNECTION
WITH THIS INFORMATION STATEMENT
NO PROXIES ARE BEING SOLICITED AND
YOU ARE REQUESTED NOT TO SEND THE COMPANY A PROXY
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This Information Statement is being mailed on or about March 4, 1996 to
holders of the Common Stock, without par value (the "Common Stock"), of PARTNERS
Health Plan of Pennsylvania, Inc., a Pennsylvania corporation (the "Company"),
in connection with the anticipated change in the Board of Directors of the
Company in connection with the transactions contemplated by the Stock Purchase
and Merger Agreement, dated as of December 18, 1995 (the "Merger Agreement"), by
and among AHP Holdings, Inc., a Connecticut corporation ("Holdings"), the
Company, Coventry Corporation, a Delaware corporation ("Coventry"), and Coventry
Acquisition Corporation, a Tennessee corporation and a wholly-owned subsidiary
of Coventry ("Coventry Sub"). Holdings is a wholly-owned indirect subsidiary of
Aetna Life and Casualty Company.
NO ACTION IS REQUIRED BY THE SHAREHOLDERS OF THE COMPANY IN CONNECTION WITH
THE ANTICIPATED CHANGE IN THE COMPOSITION OF THE BOARD OF DIRECTORS. This
information Statement is provided solely for your information pursuant to the
requirements of Section 14(f) of the Securities Exchange Act of 1934, as amended
and Rule 14f-1 thereunder.
This Information Statement is being furnished by the Company. Information
contained herein concerning Coventry and Coventry Sub is based on information
supplied to the Company by Coventry.
Pursuant to the Merger Agreement, Coventry Sub will acquire, for a purchase
price of $5,274.90 per share, all 4,957 shares of the Company's Common Stock
owned by Holdings at a closing that is currently anticipated to take place on
Friday, March 15, 1996 (the "Closing"). At the Closing, Coventry Sub will also
purchase from Holdings 2,955 shares of Redeemable Preferred Stock, without par
value, of the Company (the "Preferred Stock") for $2,955,000 in cash. As a
result of such purchases, Coventry Sub will own approximately 81% of the
outstanding shares of Common Stock of the Company and all of the outstanding
shares of Preferred Stock of the Company. Pursuant to the Merger Agreement,
Coventry Sub will merge with and into the Company (the "Merger") at or as soon
as practicable after the Closing. In the Merger, each share of Common Stock of
the Company not acquired from Holdings will be converted automatically into the
right to receive $5,274.90 in cash. As a result of the Merger, the persons who,
on the date of the Merger, are the members of the Board of Directors of Coventry
Sub will become the members of the Board of Directors of the Company on and
after the effective time of the Merger (the "Effective Time"), and the persons
who, on the date of the Merger, are the officers of Coventry Sub will become the
officers of the Company on and after the Effective Time.
It is anticipated that the Merger will not require a vote of the
shareholders of the Company under applicable Pennsylvania law.
Closing of the stock purchase and the Merger is conditioned upon the
receipt of regulatory approval from the Insurance Department of the Commonwealth
of Pennsylvania, and the satisfaction of certain closing conditions set forth in
the Merger Agreement. If the Closing and the Merger fail to occur, the members
of the
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Board of Directors of Coventry Sub will not become members of the Board of
Directors of the Company and the officers of Coventry Sub will not become the
officers of the Company.
If the Closing and the Merger occur, shareholders will receive a letter of
transmittal and instructions for surrendering their stock certificates to the
Company to receive cash in the amount of $5,274.90 per share in exchange for
such certificates and will receive information concerning their appraisal rights
under Pennsylvania law.
DIRECTORS OF COVENTRY SUB
Set forth below are the names, ages, present principal occupations or
employment history of the directors of Coventry Sub, who will become the
directors of the Company upon consummation of the Merger.
<TABLE>
<CAPTION>
NAME AND AGE PRINCIPAL OCCUPATION AND OTHER INFORMATION
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<S> <C>
Lawrence N. Kugelman, 53 President and Chief Executive Officer of Coventry since
December 1995; director of Coventry since August 1992.
Self-employed from March 1995 through December 1995.
Executive Vice President of American Medical
International, an organization that owns and operates
acute care hospitals, from January 1993 to March 1995.
Executive Director of Our Sisters of Saint Joseph
Foundation, which was created in connection with Health
Plan of America's conversion from not-for-profit to for-
profit status, from July 1992 to December 1992. President
and Chief Executive Officer of Health Plan of America
from September 1986 to July 1992.
Richard H. Jones, 40 Senior Vice President, Finance and Development, and
Treasurer of Coventry since June 1993; director of
Coventry since December 1995; Vice President, Chief
Financial Officer and Treasurer of Coventry from November
1990 to June 1993; Corporate Controller of Coventry from
June 1990 to November 1990.
Frederick G. Merkel, 42 Regional Vice President of Coventry since May 1995; Vice
President of Coventry since April 1994. President of
HealthAmerica of Central Pennsylvania, a division of
HealthAmerica of Pennsylvania (acquired by Coventry in
1994) since February 1991. Vice President of Marketing
and Development of HealthAmerica of Pennsylvania from
September 1988 to February 1991.
</TABLE>
OFFICERS OF COVENTRY SUB
Set forth below is certain information concerning the officers of Coventry
Sub, who will become the officers of the Company on and after the Effective Time
of the Merger.
<TABLE>
<S> <C>
Lawrence N. Kugelman President
Richard H. Jones Vice President and Chief Financial Officer
Frederick G. Merkel Vice President
Shirley R. Smith Secretary
</TABLE>
Ms. Smith has been a Vice President, the Corporate General Counsel and
Secretary of Coventry since March 1994. From August 1993 to March 1994, she was
Acting General Counsel and Secretary of Coventry and from April 1989 to August
1993, she was Assistant General Counsel of Coventry.
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DIRECTOR AND OFFICER COMPENSATION
None of the members of the Board of Directors of Coventry Sub or the
officers of Coventry Sub currently receive any compensation from Coventry Sub or
any other compensation with respect to their service as directors or officers of
Coventry Sub and, following the Merger, they will not receive any compensation
from the Company or any other compensation with respect to their service as
directors or officers of the Company.
VOTING SECURITIES AND PRINCIPAL HOLDERS THEREOF
The outstanding voting securities of the Company as of March 1, 1996
consist of 6,075 shares of Common Stock, of which 4,957 shares, or approximately
81%, are owned by Holdings.
The following table sets forth information as to the beneficial ownership
of the Common Stock by each person known to Coventry, as of March 1, 1996, to
own more than 5% of the shares of Common Stock:
<TABLE>
<CAPTION>
NAME AND ADDRESS AMOUNT AND NATURE PERCENT
OF BENEFICIAL OWNER OF BENEFICIAL OWNERSHIP OF CLASS
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<S> <C> <C>
Aetna Life and Casualty Company
151 Farmington Avenue
Hartfort, CT 06156
AHP Holdings, Inc. 4,957(1) 81%
151 Farmington Avenue
Hartford, CT 06156
</TABLE>
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(1) To the knowledge of Coventry, Holdings is a wholly owned subsidiary of Aetna
Life Insurance Company, which is a wholly owned subsidiary of Aetna Life and
Casualty Company.
None of the directors or officers of Coventry Sub owns any shares of
capital stock of the Company, and no shares of capital stock of the Company are
owned by Coventry or any of its officers or directors.
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