<PAGE> 1
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
SCHEDULE 14D-9
(AMENDMENT NO. 1)
SOLICITATION/RECOMMENDATION STATEMENT
PURSUANT TO SECTION 14(d)(4) OF THE
SECURITIES EXCHANGE ACT OF 1934
------------------------
ACORDIA, INC.
(NAME OF SUBJECT COMPANY)
ACORDIA, INC.
(NAME OF PERSON(S) FILING STATEMENT)
COMMON STOCK, PAR VALUE $1.00 PER SHARE
(TITLE OF CLASS OF SECURITIES)
------------------------
004929 105
(CUSIP NUMBER OF CLASS OF SECURITIES)
------------------------
ERNEST J. NEWBORN, JR.,
VICE PRESIDENT, GENERAL COUNSEL AND SECRETARY
ACORDIA, INC.
120 MONUMENT CIRCLE
INDIANAPOLIS, INDIANA 46204
(317) 488-6666
(NAME, ADDRESS AND TELEPHONE NUMBER OF PERSON AUTHORIZED TO RECEIVE
NOTICE AND COMMUNICATION ON BEHALF OF THE PERSON(S) FILING STATEMENT)
WITH COPIES TO:
JONATHAN L. FREEDMAN, ESQ.
DEWEY BALLANTINE
1301 AVENUE OF THE AMERICAS
NEW YORK, NY 10019-6092
(212) 259-8000
================================================================================
<PAGE> 2
Acordia, Inc. (the "Company") hereby amends and supplements its
Solicitation/Recommendation Statement on Schedule 14D-9 originally filed on June
6, 1997 (the "Statement") relating to a tender offer by AICI Acquisition Corp.,
a Delaware corporation and a wholly-owned subsidiary of Anthem Insurance
Companies, Inc., an Indiana mutual insurance company, disclosed in a Tender
Offer Statement on Schedule 14D-1 dated June 6, 1997 to purchase any and all of
the outstanding shares of common stock, par value $1.00 per share, of the
Company at a price of $40.00 per share, net to the seller in cash, without
interest thereon, upon the terms and subject to the conditions set forth in the
Offer to Purchase dated June 6, 1997 and the related Letter of Transmittal.
Capitalized terms used herein but not otherwise defined shall have the meanings
assigned to them in the Statement.
ITEM 9. MATERIAL TO BE FILED AS EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NO.
- --------
<C> <S>
(a)(1) Offer to Purchase dated June 6, 1997.
(a)(2) Letter of Transmittal dated June 6, 1997.
(a)(3) Text of Press Release dated June 2, 1997.
(a)(4) Fairness Opinion of Alex. Brown & Sons, Incorporated dated May 30, 1997.
(a)(5) Letter to Acordia, Inc. Stockholders, dated June 6, 1997.
(c)(1) Agreement and Plan of Merger dated as of June 2, 1997, by and among Acordia,
Inc., Anthem Insurance Companies, Inc. and AICI Acquisition Corp.
(c)(2) Portions of Acordia, Inc.'s Proxy Statement dated April 11, 1997, for the Acordia
1997 Annual Meeting of Stockholders.
(c)(3) Acordia, Inc. 1992 Stock Compensation Plan.
(c)(4) Acordia, Inc. Directors Stock Compensation Plan.
(c)(5) Acordia, Inc. Directors Deferred Compensation Plan.
(c)(6) Acordia 401(k) Long Term Savings Investment Plan, as amended to date.
(c)(7) Transaction Agreement dated February 17, 1997, by and between Acordia, Inc. and
Frank C. Witthun.
(c)(8) Transaction Agreement dated February 28, 1997, by and between Acordia, Inc. and
John J. O'Connor.
(c)(9) Transaction Agreement dated February 28, 1997, by and between Acordia, Inc. and
Ernest J. Newborn.
(c)(10) Transaction Agreement dated February 28, 1997, by and between Acordia, Inc. and
Keith A. Maib.
(c)(11) Transaction Agreement dated February 28, 1997, by and between Acordia, Inc. and
Robert C. Nevins.
(c)(12) Transaction Agreement dated February 28, 1997, by and between Acordia, Inc. and
Daniel W. Kendall.
(c)(13) Transaction Agreement dated March 17, 1997, by and between Acordia, Inc. and
Michael B. Henning.
(c)(14) Employment Agreement dated June 1, 1994, by and between Acordia, Inc. and Ernest
J. Newborn.
(c)(15) Employment Agreement dated January 1, 1994, by and between Acordia, Inc. and John
J. O'Connor.
(c)(16) Complaint filed in Crandon Capital Partners v. Acordia, Inc. et. al (Del. Ch.
June 4, 1997).
(c)(17) Complaint filed in Sherry Levinson v. Acordia, Inc. et. al. and Anthem Insurance
Companies, Inc. (Del. Ch. June 4, 1997).
*(c)(18) Notice regarding the Acordia, Inc. Producers Deferred Compensation & Equity Plan.
*(c)(19) Notice regarding the Anthem, Acordia and ABI 401(k) Plans.
</TABLE>
- ---------------
* Material filed herewith.
2
<PAGE> 3
SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
ACORDIA, INC.
By: /s/ FRANK C. WITTHUN
------------------------------------
Name: Frank C. Witthun
Title: President and Chief
Executive Officer
Dated: June 13, 1997
3
<PAGE> 4
EXHIBIT INDEX
<TABLE>
<CAPTION>
SEQUENTIALLY
EXHIBIT NUMBERED
NUMBER DESCRIPTION PAGE
- ---------- ---------------------------------------------------------------------- ------------
<S> <C> <C>
(a)(1) Offer to Purchase dated June 6, 1997..................................
(a)(2) Letter of Transmittal dated June 6, 1997..............................
(a)(3) Text of Press Release dated June 2, 1997..............................
(a)(4) Fairness Opinion of Alex. Brown & Sons, Incorporated dated May 30,
1997..................................................................
(a)(5) Letter to Acordia, Inc. Stockholders dated June 6, 1977...............
(c)(1) Agreement and Plan of Merger dated as of June 2, 1997, by and among
Acordia, Inc., Anthem Insurance Companies, Inc. and AICI Acquisition
Corp..................................................................
(c)(2) Portions of Acordia Inc.'s Proxy Statement dated April 11, 1997, for
the Acordia 1997 Annual Meeting of Stockholders.......................
(c)(3) Acordia, Inc. 1992 Stock Compensation Plan............................
(c)(4) Acordia, Inc. Directors Stock Compensation Plan.......................
(c)(5) Acordia, Inc. Directors Deferred Compensation Plan....................
(c)(6) Acordia 401(k) Long Term Savings Investment Plan, as amended to
date..................................................................
(c)(7) Transaction Agreement dated February 17, 1997, by and between Acordia,
Inc. and Frank C. Witthun.............................................
(c)(8) Transaction Agreement dated February 28, 1997, by and between Acordia,
Inc. and John J. O'Connor.............................................
(c)(9) Transaction Agreement dated February 28, 1997, by and between Acordia,
Inc. and Ernest J. Newborn............................................
(c)(10) Transaction Agreement dated February 28, 1997, by and between Acordia,
Inc. and Keith A. Maib................................................
(c)(11) Transaction Agreement dated February 28, 1997, by and between Acordia,
Inc. and Robert C. Nevins.............................................
(c)(12) Transaction Agreement dated February 28, 1997, by and between Acordia,
Inc. and Daniel W. Kendall............................................
(c)(13) Transaction Agreement dated March 17, 1997, by and between Acordia,
Inc. and Michael B. Henning...........................................
(c)(14) Employment Agreement dated June 1, 1994, by and between Acordia, Inc.
and Ernest J. Newborn.................................................
(c)(15) Employment Agreement dated January 1, 1994, by and between Acordia,
Inc. and John J. O'Connor.............................................
(c)(16) Complaint filed in Crandon Capital Partners v. Acordia, Inc. et al.
(Del. Ch. June 4, 1997)...............................................
(c)(17) Complaint filed in Sherry Levinson v. Acordia, Inc. et al. and Anthem
Insurance Companies, Inc. (Del. Ch. June 4, 1997).....................
*(c)(18) Notice regarding the Acordia, Inc. Producers Deferred Compensation &
Equity Plan.
*(c)(19) Notice regarding the Anthem, Acordia and ABI 401(k) Plans.
</TABLE>
- ---------------
* Material filed herewith.
<PAGE> 1
EXHIBIT (c)(18)
ACORDIA, INC. PRODUCERS DEFERRED
COMPENSATION & EQUITY PLAN
- --------------------------------------------------------------------------------
On June 6, 1997, Anthem commenced an offer to purchase all outstanding shares
of Acordia stock ("Tender Offer"). As a participant in the Producers Deferred
Compensation & Equity Plan (PDC) you may be affected, if you previously
purchased Acordia stock through the Plan. Conditioned upon the successful
completion of the Tender Offer, the PDC is being amended to suspend allocations
in Acordia stock and to convert non-vested restricted stock into non-vested
restricted cash awards. This notice is intended to describe the amendment to
the PDC and solicit your consent to the terms of the amendment. Unless you
notify the Pension Committee in writing on or before June 30, 1997 that you do
NOT consent to the effect of the amendment on your stock awards, your awards
will be converted to restricted cash amounts as described below.
1. PDC Participants who do not own Acordia Stock
No action is required, if you do not have your deferred contributions
invested in the Acordia Stock Fund. You should simply be aware that effective
June 2, 1997, no further investments in Acordia Stock are permitted.
2. If your PDC investment elections include Acordia Stock
(a) Restricted Stock. Effective June 2, 1997, no further investments in
Acordia Stock are permitted. The Pension Committee has authorized the
Company to convert your restricted shares (including the full 1997 Plan
Year shares) to dollars, based on a per share value of $40. The deferral
account will remain in existence as a Restricted Cash Account. This
account will receive interest, which currently is based on the 10-year
Treasury Note average from October 1 to September 30 plus 150 basis
points. The Declared Rate is set each year and for 1997, the Declared
Rate is 7.83%. (See Attachment A for example). If you do not consent to
the amendment, your restricted stock investments will not be tendered and
converted and will remain outstanding until converted into the right to
receive $40 per share in cash in the merger following the Tender Offer.
Assuming your consent, you will have one UNRESTRICTED CASH account and
one RESTRICTED CASH account. The Unrestricted Cash account is 100% vested
immediately and will be distributed to you based on your distribution
elections prior to the Plan Year. The RESTRICTED CASH account will also
hold your 1996 restricted shares dollar value once they have been
tendered. The Restricted Cash account will have the same vesting schedule
as the previous restricted stock account. Distribution elections as were
made prior to the beginning of the Plan Year will remain.
<PAGE> 2
(b) OPTIONS. Each unvested option to purchase a share of Common
Stock outstanding, granted pursuant to the PDC Plan, will be
converted into cash in an amount equal to the excess of the
Offer Price ($40) over the Option Price. The cash received for
such options will be distributed as soon as practicable after
the completion of the Offer without regard to the provisions
in the Plan relating to vesting and forfeiture. If you do not
consent to the amendment, your stock options will not be
cashed-out at the Tender Offer price and will also not be
converted into cash in a merger following the Tender Offer.
Outstanding options held by you will remain outstanding. After
the contemplated merger, the options will continue to represent
the right to purchase Common Stock of the Company at the Option
Price. IT SHOULD BE NOTED, HOWEVER, THAT ACORDIA WILL BE A
WHOLLY-OWNED SUBSIDIARY OF ANTHEM AND THERE WILL BE NO TRADING
MARKET FOR SUCH SHARES.
3. UNFUNDED ACCOUNTS
Both the Restricted Cash and Unrestricted Cash Accounts are unfunded
bookkeeping accounts. Acordia will pay the amounts credited to your
Restricted and Unrestricted Cash Accounts pursuant to your current
distribution elections.
4. CONSENTS
If you do not consent to the amendment and conversion of your Acordia
Restricted Stock into restricted cash and you notify the Acordia Pension
Committee before June 30, 1997, that you do not consent, then your stock
will not be tendered or converted and will remain outstanding until
converted into the right to receive cash in a merger following a Tender
Offer. The cash from the merger will remain subject to the provisions in
the Plan relating to vesting and forfeiture.
If you do not consent to the amendment and conversion of your Acordia
Stock Option into cash and you notify the Acordia Pension Committee
before June 30, 1997, that you do not consent, then your options will
not be tendered or converted and will remain outstanding and subject
to the provisions in the Plan relating to vesting and forfeiture. Again,
it should be noted that the Company will be a wholly-owned subsidiary of
Parent and there will be no trading market for such shares.
<PAGE> 3
If you have any questions regarding your PDC account, please contact Belinda
Johnson at 317-488-6656 or Theresa Segert at 317-488-6027. If you have
questions as to the PDC amendment and your consent rights, please contact
Ernest Newborn, General Counsel, at (317) 488-6163.
Any notices to the Pension Committee should be directed to the Chairman of the
Pension Committee (c/o Ernest Newborn, General Counsel), at 120 Monument
Circle, Indianapolis, IN 46204.
A CONFERENCE CALL TO FULLY EXPLAIN AND ANSWER ANY AND ALL QUESTIONS CONCERNING
THE PROPOSED AMENDMENTS AND THEIR IMPACT ON YOUR ACCOUNTS HAS BEEN SCHEDULED
FOR:
DATE: JUNE 17, 1997
TIME: 11:00 A.M. (Central Standard Time)
PHONE: 1-800-553-0288 - ASK TO BE CONNECTED TO THE
"ACORDIA PRODUCER'S CONFERENCE CALL"
<PAGE> 4
Attachment A
Example: How tender offer would affect your stock deferrals in the Producers
Deferred Compensation & Equity Plan
Assumptions: 1) Plan Year estimated compensation is $100,000
2) Defer 10% of compensation ($10,000)
3) Fair Market Value on 1/1/97 of Plan Year = $29
4) Elect to purchase $10,000 in Acordia shares (344 shares)
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------------
1/1/97 6/2/97 12/31/97
<S> <C> <C>
* 344 Shares Issued @ $29 * $4,231 deferred on behalf of employee * If deferred sufficient funds to
* Payroll deductions begin * Equivalent to 145 shares pay for 344 shares, no action
(10% of compensation) * Tender offer commenced 6/6/97 required
* Tender price $40 per share * If deferred insufficient funds to
* Company approved cash-out of all pay for 344 shares, your
projected shares as of 1/1/97 at $40 per Restricted Cash account balance
share (344 $40=$13,760) will be reduced to cover shortfall
* $13,760 will be posted to your Restricted * Both the Unrestricted Cash and
Cash (formerly Restricted Stock) account the Restricted Cash accounts
* Will earn Declared Interest Rate (7.83% will be distributed to you based
in 1997) upon your elections made
* Deferrals will continue through 12/31/97 prior to start of Plan Year
(this allows Company to collect dollars * You should not be taxed on
owed) (-$5,769 owed on 344 shares @ restricted stock accounts until
$29 per share) the year of distribution
* Once projected shares are paid for in full
by you, your deferrals will automatically
be credited to your Unrestricted Cash
account
* Both the Unrestricted Cash and the
Restricted Cash accounts will be
distributed to you based upon your
elections made prior to start of Plan
Year & taxed appropriately
* Subject to consent, all matching stock
options granted under the Plan will receive
accelerated vesting and you will be offered
the tender value. The gain on the options is
considered taxable when paid.
</TABLE>
<PAGE> 1
EXHIBIT (c)(19)
IMPORTANT ANNOUNCEMENT
Regarding the
Anthem, Acordia and ABI 401(k) Plans
- --------------------------------------------------------------------------------
June 2, 1997
Anthem and Acordia announced today that the two companies have entered into a
merger agreement under which Anthem will offer to purchase all outstanding
shares of Acordia stock owned by persons other than Anthem. As a participant in
the 401(k) plan, you will be affected if you own any Acordia stock through the
plan.
401(k) PARTICIPANTS WHO DO NOT OWN ACORDIA STOCK
No action is required, if you do not have your 401(k) contributions invested
in the Acordia Stock Fund. You should simply be aware that effective June 2,
1997, no further investments in Acordia stock will be permitted.
IF YOUR 401(k) INVESTMENT ELECTIONS INCLUDE ACORDIA STOCK
Effective June 2, 1997, no further investments in Acordia Stock will be
permitted. All contributions that would have normally been deposited to the
Acordia Stock Fund will be placed in the Vanguard Money Market Reserve - U.S.
Treasury Portfolio Fund.
Effective June 6, 1997, investment elections still in Acordia stock will be
deposited in the Vanguard Money Market Reserve - U.S. Treasury Portfolio
Fund. You must change your future investment elections no later than noon
(Central Time) on Friday, June 6, 1997 if you do not want any contributions
deposited in the Vanguard Money Market Reserve - U.S. Treasury Portfolio
Fund. You must call InvestElect at the number below to change your investment
elections.
IF YOUR 401(k) EXISTING BALANCE IS CURRENTLY INVESTED IN ACORDIA STOCK
Effective June 2, 1997, no transfers into or out of the Acordia Stock Fund
will be permitted. You will receive an official tender offer, "in the next
two weeks, that will offer you a set price for the Acordia stock you hold in
your 401(k) account. Your shares will be converted to cash at the closing of
the tender offer and your entire Acordia Stock" account will be transferred
to the Vanguard Money Market Reserve - U.S. Treasury Portfolio Fund.
You will be permitted to transfer this money to any of the remaining
investment funds, after the Vanguard Money Market Reserve - U.S. Treasury
Portfolio Fund receives it.
- --------------------------------------------------------------------------------
Please keep in mind that your HR Representative and InvestElect will not have
information regarding the tender offer. Your tender offer packet will contain
information and a contact telephone number for your questions.
To make investment changes in your 401(k) account, please contact InvestElect
at:
Anthem Employees 1-800-491-2753
Acordia Employees 1-800-213-3609
- --------------------------------------------------------------------------------
