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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
UNDER THE SECURITIES EXCHANGE ACT OF 1934
(AMENDMENT NO.____)*
AETNA INC.
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(Name of Issuer)
6.25% Class C Voting Preferred Stock, par value $.01 per share
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(Title of Class of Securities)
008117202
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(CUSIP Number)
Howard G. Godwin, Jr., Esq.
Brown & Wood LLP
One World Trade Center
New York, New York 10048
(212) 839-5300
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(Name, Address and Telephone Number of Person Authorized to
Receive Notices and Communications)
July 19, 1996
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(Date of Event which Requires Filing of this Statement
If the filing person has previously filed a statement on Schedule 13D to
report the acquisition which is the subject of this Schedule 13D, and is
filing this schedule because of Rule 13d-1(b)(3) or (4), check the following
box / /.
Check the following box if a fee is being paid with this statement /x/. (A
fee is not required only if the filing person: (1) has a previous statement
on file reporting beneficial ownership of more than five percent of the class
of securities described in Item 1; and (2) has filed no amendment subsequent
thereto reporting beneficial ownership of five percent or less of such
class.) (See Rule 13d-7.)
NOTE: Six copies of this statement, including all exhibits, should be filed
with the Commission. See Rule 13d-1(a) for other parties to whom copies are
to be sent.
*The remainder of this cover page shall be filled out for a reporting
person's initial filing on this form with respect to the subject class of
securities, and for any subsequent amendment containing information which
would alter the disclosures provided in a prior cover page.
The information required in the remainder of this cover page shall not be
deemed to be "filed" for the purpose of Section 18 of the Securities Exchange
Act of 1934 ("Act") or otherwise subject to the liabilities of that section
of the Act but shall be subject to all other provisions of the Act (however,
see the Notes).
SEC 1746(12/91)
SCHEDULE 13D
CUSIP NO. 008117202 PAGE 1 OF 1 PAGES
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1 NAME OF REPORTING PERSON
S.S. or I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Leonard Abramson
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) / /
(b) / /
3 SEC USE ONLY
4 SOURCE OF FUNDS* OO
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED / /
PURSUANT TO ITEMS 2(d) or 2(e)
6 CITIZENSHIP OR PLACE OF ORGANIZATION United States of America
NUMBER OF 7 SOLE VOTING POWER
SHARES 1,080,350
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY -0-
EACH 9 SOLE DISPOSITIVE POWER
REPORTING 1,080,350
PERSON 10 SHARED DISPOSITIVE POWER
WITH -0-
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
1,080,350
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11)
EXCLUDES CERTAIN SHARES* /x/
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
9.3%
14 TYPE OF REPORTING PERSON*
IN
*SEE INSTRUCTION BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION
SCHEDULE 13D
ITEM 1. SECURITY AND ISSUER
This schedule relates to the shares of 6.25% Class C Voting Preferred
Stock, par value $.01 per share, of Aetna Inc., a Connecticut corporation
("Parent"). The principal executive office of Parent is 151 Farmington
Avenue, Hartford, Connecticut 06156.
ITEM 2. IDENTITY AND BACKGROUND
(a) Leonard Abramson;
(b) 376 Regatta Drive
Jupiter, FL 33477;
(c) Consultant to Parent since July 1996 and prior thereto the chairman,
principal executive officer and a director of U.S. Healthcare, Inc. and
its predecessor entity since 1982;
(d)-(e) During the last five years, Mr. Abramson (i) has not been convicted
in a criminal proceeding (excluding traffic violations or similar
misdemeanors), and (ii) has not been a party to a civil proceeding
of a judicial or administrative body of competent jurisdiction and
as a result of such proceeding was or is subject to a judgment,
decree or final order enjoining future violations of, or
prohibiting or mandating activities subject to, federal or state
securities laws or finding any violation of such laws; and
(f) United States of America.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION
Prior to July 19, 1996, Mr. Abramson owned 1,343,755 shares of Common
Stock, par value $0.005 per share ("U.S. Healthcare Common Stock") (of which
he disclaimed beneficial ownership of 881,803 shares) and 14,411,955 shares
of Class B Stock, par value $0.005 per share ("U.S. Healthcare Class B
Stock") of U.S. Healthcare, Inc. ("U.S. Healthcare"). In connection with the
announced combination of U.S. Healthcare and Aetna Life and Casualty Company,
a Connecticut corporation ("Aetna"), and upon the consummation of the mergers
contemplated by the Agreement and Plan of Merger, dated as of March 30, 1996,
among Aetna, U.S. Healthcare, Parent and certain wholly-owned subsidiaries of
Parent, as amended by Amendment No. 1 thereto dated as of May 30, 1996 (the
"Merger Agreement"), on July 19, 1996, each outstanding share of U.S.
Healthcare Common Stock and each share of U.S. Healthcare Class B Stock
(except for shares held by U.S. Healthcare as treasury stock, certain shares
held by Aetna or subsidiaries of Aetna and shares for which dissenting
shareholders' rights were properly exercised and perfected) were converted
into the right to receive (a) 0.2246 shares of Common Stock, par value $.01
per share, of Parent ("Parent Common Stock"), together with 0.2246 rights
(each, a "Parent Right") issued pursuant to the Rights Agreement entered into
by Parent and First Chicago Trust Company of New York, as Rights Agent, (b)
0.0749 shares of 6.25% Class C Voting Preferred Stock, par value $.01 per
share, of Parent (the "Mandatorily Convertible Preferred Stock") and (c)
$34.20 in cash, all as more fully set forth in the Merger Agreement and the
Joint Proxy Statement/Prospectus of Parent and U.S. Healthcare dated as of
June 12, 1996 (the "Merger"). As a result of the Merger, Mr. Abramson is now
the beneficial owner of 1,080,350 shares of Mandatorily Convertible Stock of
Parent.
ITEM 4. PURPOSE OF TRANSACTION
Mr. Abramson acquired the 1,080,350 shares of Mandatorily Convertible
Preferred Stock in the manner described in Item 3 above and, except as
described below, has no plans or proposals that would result in (1) the
acquisition by any person of additional securities of Parent or the
disposition of securities of the Parent; (2) an extraordinary corporate
transaction, such as a merger, reorganization or liquidation of Parent
or any of its subsidiaries; (3) a sale or transfer of a material amount
of assets of Parent or any of its subsidiaries; (4) any change in the
present board of directors or management of Parent, including any plans
or proposals to change the number or term of directors or to fill any
existing vacancies on the board of directors of Parent, except that Mr.
Abramson and two other persons designated by U.S. Healthcare are expected to
be appointed to the board of directors of Parent within 60 days of the
consummation of the Merger; (5) any material change in the present
capitalization or dividend policy of Parent; (6) any other material change in
the business or corporate structure of Parent; (7) changes in the charter,
by-laws or instruments corresponding thereto of Parent, or other actions
which may impede the acquisition of control of Parent by any person; (8) any
class of securities of Parent being delisted from a national securities
exchange or ceasing to be authorized to be quoted in an inter-dealer
quotation system of a registered national securities association; (9) any
class of equity securities of Parent becoming eligible for termination of
registration pursuant to Section 12(g)(4) of the Act; or (10) any action
similar to any of those enumerated above. Mr. Abramson, however, reserves
the right to change his plans or intentions at any time and to take any and
all actions that he deems appropriate to maximize the value of his investment
including, among other things, from time to time increasing or decreasing the
number of Mandatorily Convertible Preferred Stock by acquiring additional
shares, or by disposing of all or a portion of the shares of Mandatorily
Convertible Preferred Stock in open market or privately negotiated
transactions depending on existing market conditions and other considerations
discussed below. Mr. Abramson intends to review his investment in Parent on
a continuing basis and, depending upon the price and availability of
Mandatorily Convertible Preferred Stock, subsequent developments affecting
Parent, the general business and future prospects of Parent, other investment
and business opportunities available to Mr. Abramson, general stock market
and economic conditions, tax considerations and other factors considered
relevant, may decide at any time to increase or decrease the size of his
investment in Parent. In this regard, Parent has filed a registration
statement on Form S-3 (the "Registration Statement") under the Securities Act
of 1933, as amended (the "Securities Act"), with respect to Parent Common
Stock and Mandatorily Convertible Preferred Stock owned by Mr. Abramson which
may be offered and sold from time to time by Mr. Abramson.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER
(a) Mr. Abramson is the beneficial owner of 1,080,350 shares of Mandatorily
Convertible Preferred Stock of Parent, or approximately 9.3% of the
Mandatorily Convertible Preferred Stock of Parent based on a total of
11,655,548 shares of Mandatorily Convertible Preferred Stock outstanding
as of July 19, 1996. In addition, trusts for the benefit of members of
Mr. Abramson's family own 66,047 shares of Mandatorily Convertible
Preferred Stock, for which he disclaims beneficial ownership.
(b) Mr. Abramson has sole power to vote or direct the vote and dispose or
direct the disposition of 1,080,350 shares of Mandatorily Convertible
Preferred Stock of Parent.
(c) During the past 60 days, Mr. Abramson has not effected any transaction
in the securities of Parent, except as described in Item 3 above.
(d) Not applicable.
(e) Not applicable.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH
RESPECT TO SECURITIES OF THE ISSUER
Pursuant to a Registration Rights Agreement dated as of March 30, 1996
as amended by Amendment No. 1 thereto dated as of May 30, 1996 (the
"Registration Rights Agreement"), Parent has caused to be filed the
Registration Statement, which Registration Statement has been declared
effective by the Securities and Exchange Commission and provides for the
offer and sale from time to time by Mr. Abramson of Parent Common Stock and
Mandatorily Convertible Preferred Stock. In addition, the Registration
Rights Agreement provides that Mr. Abramson has the right under certain
circumstances to have the shares of Parent Common Stock and Mandatorily
Convertible Preferred Stock beneficially owned by him included in a
registration statement otherwise filed by Parent under the Securities Act.
Except as otherwise described in this Item 6, Mr. Abramson does not have
any contract, arrangement, understanding or relationship with any other
person with respect to any security of Parent.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS
Exhibit No. Description
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1 Registration Rights Agreement dated as of March 30, 1996
between Parent (formerly known as Butterfly, Inc.) and Leonard
Abramson
2 Amendment No. 1 to Registration Rights Agreement dated as of
May 30, 1996 between Parent and Leonard Abramson
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.
Date: July 29, 1996
/s/ Leonard Abramson
---------------------------------
Leonard Abramson
The original statement shall be signed by each person on whose behalf
the statement is filed or his authorized representative. If the statement is
signed on behalf of a person by his authorized representative (other than an
executive officer or general partner of this filing person, evidence of the
representative's authority to sign on behalf of such person shall be filed
with the statement, provided, however, that a power of attorney for this
purpose which is already on file with the Commission may be incorporated by
reference. The name and any title of each person who signs the statement
shall be typed or printed beneath his signature.
ATTENTION: INTENTIONAL MISSTATEMENTS OR OMISSIONS OF FACT CONSTITUTE
FEDERAL CRIMINAL VIOLATIONS (SEE 18 U.S.C. 1001)
REGISTRATION RIGHTS AGREEMENT
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REGISTRATION RIGHTS AGREEMENT dated as of March 30, 1996 between
Butterfly, Inc., a Connecticut corporation (the "COMPANY") and Leonard
Abramson (the "SHAREHOLDER").
ARTICLE I
DEFINITIONS
1.1. Definitions. The following terms, as used herein, have
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the following meanings:
"1933 ACT" means the Securities Act of 1933, as amended, and the
rules and regulations thereunder.
"1934 ACT" means the Securities Exchange Act of 1934, as amended
and the rules and regulations thereunder.
"BUSINESS DAY" means any day except a Saturday, Sunday or other
day on which commercial banks in New York are authorized by law to close.
"COMMISSION" means the Securities and Exchange Commission.
"COMMON STOCK" means the Company's Common Stock, par value $1.00
per share.
"MERGER AGREEMENT" means the Agreement and Plan of
Reorganization dated as of the date hereof among Adonis, Inc., Antelope,
Inc., the Company, Adonis Merger Sub, Inc. and Antelope Merger Sub, Inc.
"PERSON" means an individual, a corporation, a partnership,
limited liability company, an association, a trust or other entity or
organization, including a government or political subdivision or an agency
or instrumentality thereof.
"PIGGYBACK REGISTRATION" means a Piggyback Registration as
defined in Section 2.2.
"PREFERRED STOCK" means the Company's Class C Preferred Stock,
par value $.01 per share.
"REGISTRABLE SECURITIES" means all shares of Common Stock and
Preferred Stock owned by the Shareholder.
"SHELF REGISTRATION STATEMENT" means the Shelf Registration
Statement as defined in Section 2.1.
"UNDERWRITER" means a securities dealer who purchases any
Registrable Securities as principal and not as part of such dealer's
market-making activities.
ARTICLE II
REGISTRATION RIGHTS
2.1. Shelf Registration. (a) The Company shall prepare and
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file with the Commission a shelf registration statement (as amended and
supplemented from time to time, the "SHELF REGISTRATION STATEMENT")
relating to the Registrable Securities in accordance with Rule 415 under
the 1933 Act and will use its best efforts to cause such Shelf
Registration Statement to be declared effective no later than the Merger
Date (as defined in the Merger Agreement) and to keep such Shelf
Registration Statement continuously effective and in compliance with the
1933 Act and usable for resale of such Registrable Securities, for a
period from the date on which the Commission declares such Shelf
Registration Statement effective until the first date upon which the
aggregate amount of Registrable Securities then owned by the Shareholder
could be sold pursuant to Rule 145 under the 1933 Act within 15 trading
days calculated in accordance with Rule 144 of the 1933 Act as of such
date.
(b) If the aggregate proceeds from an offering of Registrable
Securities pursuant to the Shelf Registration Statement are expected to be
more than $100 million and if Shareholder so elects, such offering may be
in the form of an underwritten offering. Shareholder shall select the
managing Underwriters and any additional investment bankers and managers
to be used in connection with such offering; provided that such managing
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Underwriters and additional investment bankers must be reasonably
satisfactory to the Company.
2.2. Piggyback Registration. If the Company proposes to file a
----------------------
registration statement under the 1933 Act with respect to an offering of
Common Stock or Preferred Stock (i) for the Company's own account (other
than a registration statement on Form S-4 or S-8 (or any substitute form
that may be adopted by the Commission)) or (ii) for the account of any of
its holders of Common Stock or Preferred Stock, then the Company shall
give written notice of such proposed filing to Shareholder as soon as
practicable (but in no event less than 10 days before the anticipated
filing date), and such notice shall offer Shareholder the opportunity to
register such number of shares of Registrable Securities as Shareholder
may request on the same terms and conditions as the Company's or such
holder's Common Stock or Preferred Stock (a "PIGGYBACK REGISTRATION").
2.3. Reduction of Offering. Notwithstanding anything contained
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herein, if the managing Underwriter of an offering described in Section
2.2 delivers a written opinion to the Company that (i) the size of the
offering that Shareholder, the Company and any other Persons intend to
make or (ii) the combination of securities that Shareholder, the Company
and such other Persons intend to include in such offering are such that
the success of the offering would be materially and adversely affected,
then (A) if the size of the offering is the basis of such Underwriter's
opinion, the amount of Registrable Securities to be offered for the
account of Shareholder shall be reduced to the extent necessary to reduce
the total amount of securities to be included in such offering to the
amount recommended by such managing Underwriter; provided that in the case
of a Piggyback Registration, if securities are being offered for the
account of Persons other than the Company, then the proportion by which
the amount of such Registrable Securities intended to be offered for the
account of Shareholder is reduced shall not exceed the proportion by which
the amount of such securities intended to be offered for the account of
such other Persons is reduced; and (B) if the combination of securities to
be offered is the basis of such Underwriter's opinion, (x) the Registrable
Securities to be included in such offering shall be reduced as described
in clause (A) above (subject to the proviso in clause (A)), and (y) in the
case of a Piggyback Registration, if the actions described in sub-clause
(x) of this clause (B) would, in the judgment of the managing Underwriter,
be insufficient substantially to eliminate the adverse effect that
inclusion of the Registrable Securities requested to be included would
have on such offering, such Registrable Securities will be excluded from
such offering.
ARTICLE III
REGISTRATION PROCEDURES
3.1. Filings; Information. In connection with the Shelf
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Registration Statement pursuant to Section 2.1 hereof, the Company and
Shareholder agree as follows:
(a) Shareholder will notify Company at least 10 days prior to
making any offer or sale of any Registrable Securities pursuant to the Shelf
Registration Statement. The Company shall be entitled, by notifying
Shareholder within 5 days of receiving the aforementioned notice from the
Shareholder, to postpone or suspend for a reasonable period of time (in no
event to exceed 75 days) the offering of any Registrable Securities if the
Company shall determine in good faith that such offering will interfere with
a pending or contemplated financing, merger, sale or acquisition of assets,
recapitalization or other corporate action or policies of the Company. If
the Company elects to so postpone or suspend the offering of any Registrable
Securities, the Company shall, to the extent necessary, amend or supplement
the Shelf Registration Statement to permit the offering of Registrable
Securities within 75 days of receiving the aforementioned notice from the
Shareholder.
(b) The Company will, if requested, prior to filing the Shelf
Registration Statement or any amendment or supplement thereto, furnish to
Shareholder and each applicable managing Underwriter, if any, without charge,
copies thereof, and thereafter furnish to Shareholder and each such
Underwriter, if any, without charge, such number of copies of such
registration statement, amendment and supplement thereto (in each case
including all exhibits thereto and documents incorporated by reference
therein) and the prospectus included in such registration statement
(including each preliminary prospectus) as Shareholder or each such
Underwriter may reasonably request in order to facilitate the sale of the
Registrable Securities.
(c) After the filing of the Shelf Registration Statement, the
Company will promptly notify Shareholder of any stop order issued or, to the
Company's knowledge, threatened to be issued by the Commission and use
its best efforts to prevent the entry of such stop order or to remove it if
entered at the earliest possible date.
(d) The Company will use its best efforts in cooperation with
Shareholder and the Underwriters or agents, as the case may be, to qualify
the Registrable Securities for offer and sale under such other securities or
blue sky laws of such jurisdictions in the United States as Shareholder
reasonably requests; provided that the Company will not
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be required to (i) qualify generally to do business in any jurisdiction
where it would not otherwise be required to qualify but for this paragraph
(d), (ii) subject itself to taxation in any such jurisdiction or (iii)
consent to general service of process in any such jurisdiction.
(e) The Company will as promptly as is practicable notify
Shareholder, at any time when a prospectus relating to the sale of the
Registrable Securities is required by law to be delivered in connection with
sales by an Underwriter or dealer, of the occurrence of any event requiring
the preparation of a supplement or amendment to such prospectus so that, as
thereafter delivered to the purchasers of such Registrable Securities, such
prospectus will not contain an untrue statement of a material fact or omit to
state any material fact required to be stated therein or necessary to make
the statements therein, in the light of the circumstances under which they
were made, not misleading and shall as promptly as practicable make available
to Shareholder and to the Underwriters any such supplement or amendment.
Shareholder agrees that, upon receipt of any notice from the Company of the
occurrence of any event of the kind described in the preceding sentence,
Shareholder will forthwith discontinue the offer and sale of Registrable
Securities pursuant to the registration statement covering such Registrable
Securities until receipt by Shareholder and the Underwriters of the copies
of such supplemented or amended prospectus and, if so directed by the
Company, Shareholder will deliver to the Company all copies, other than
permanent file copies then in Shareholder's possession, of the most recent
prospectus covering such Registrable Securities at the time of receipt of
such notice.
(f) The Company will deliver to Shareholder and each
Underwriter or agent participating in an offering pursuant to the Shelf
Registration Statement, without charge, as many copies of each preliminary
prospectus as Shareholder or such Underwriter or agent may reasonably
request, and the Company hereby consents to the use of such copies for
purposes permitted by the 1933 Act. The Company will deliver to Shareholder
and each Underwriter or agent participating in such offering, without charge,
from time to time during the period when a prospectus is required to be
delivered under the 1933 Act, such number of copies of such
prospectus (as supplemented or amended) as Shareholder or such Underwriter
or agent may reasonably request.
(g) The Company will comply with the 1933 Act and the rules and
regulations of the Commission thereunder, and the 1934 Act and the rules and
regulations of the Commission thereunder so as to permit the completion of
the distribution of the Registrable Securities pursuant to the Shelf
Registration Statement in accordance with the intended method or
methods of distribution contemplated in the prospectus relating thereto.
(h) Upon the request of Shareholder or the managing Underwriter
or agent, as the case may be, or if required by the rules, regulations or
instructions applicable to the registration form used by the Company, or by
the 1933 Act or by any other rules and regulations thereunder in connection
with the offering of Registrable Securities pursuant to the Shelf
Registration Statement, the Company will prepare a prospectus supplement that
complies with the 1933 Act and the rules and regulations of the Commission
thereunder and that sets forth the aggregate amount of the Registrable
Securities being sold, the name or names of any Underwriters or agents
participating in the offering, the price at which the Registrable Securities
are to be sold, any discounts, commissions or other items constituting
compensation, and such other information as Shareholder or the managing
Underwriter or agent, as the case may be, and the Company deem appropriate in
connection with the offering of the Registrable Securities prior to its being
used or filed with the Commission.
(i) The Company may require the Shareholder to promptly furnish
in writing to the Company such information regarding the distribution of the
Registrable Securities as may be legally required in connection with such
registration.
(j) The Company will enter into customary agreements (including
an underwriting agreement in customary form) and take such other actions as
are reasonably required in order to expedite or facilitate the sale of such
Registrable Securities.
(k) The Company will furnish to Shareholder and to each
Underwriter a signed counterpart, addressed to Shareholder or such
Underwriter, of (i) an opinion or opinions of counsel to the Company and (ii)
a comfort letter or comfort letters from the Company's independent public
accountants, each in customary form and covering such matters of the type
customarily covered by opinions or comfort letters, as the case may be, as
Shareholder or the managing Underwriter reasonablY requests.
(l) The Company will make generally available to its security
holders, as soon as reasonably practicable, an earnings statement covering
a period of 12 months, beginning within three months after the effective date
of the registration statement, which earnings statement shall satisfy
the provisions of Section 11(a) of the 1933 Act and the rules and regulations
of the Commission thereunder.
(m) The Company will use its reasonable efforts to cause all
such Registrable Securities to be listed on each securities exchange on which
similar securities issued by the Company are then listed.
3.2. Registration Expenses. In connection with the Shelf
---------------------
Registration Statement and in connection with any Piggyback Registration,
the Company shall pay, the following expenses incurred in connection with
such registration: (i) filing fees with the Commission, (ii) fees and
expenses of compliance with securities or blue sky laws (including
reasonable fees and disbursements of counsel in connection with blue sky
qualifications of the Registrable Securities), (iii) printing expenses,
(iv) fees and expenses incurred in connection with the listing of the
Registrable Securities, (v) fees and expenses of counsel and independent
certified public accountants for the Company and (vi) the reasonable fees
and expenses of any additional experts retained by the Company in
connection with such registration. The Shareholder shall pay any
underwriting fees, discounts or commissions attributable to the sale of
Registrable Securities and any out-of-pocket expenses of Shareholder.
ARTICLE IV
INDEMNIFICATION AND CONTRIBUTION
4.1. Indemnification by the Company. The Company agrees to
------------------------------
indemnify and hold harmless Shareholder, its officers and directors, and
each Person, if any, who controls Shareholder within the meaning of either
Section 15 of the 1933 Act or Section 20 of the 1934 Act from and against
any and all losses, claims, damages and liabilities caused by any untrue
statement or alleged untrue statement of a material fact contained in any
registration statement or prospectus relating to the Registrable
Securities (as amended or supplemented if the Company shall have furnished
any amendments or supplements thereto) or any preliminary prospectus, or
caused by any omission or alleged omission to state therein a material
fact required to be stated therein or necessary to make the statements
therein not misleading, except insofar as such losses, claims, damages or
liabilities are caused by any such untrue statement or omission or alleged
untrue statement or omission based upon information, relating to
Shareholder or the plan of distribution furnished in writing to the
Company by or on behalf of Shareholder expressly for use therein; provided
that the foregoing indemnity agreement with respect
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to any preliminary prospectus shall not inure to the benefit of
Shareholder if a copy of the most current prospectus at the time of the
delivery of the Registrable Securities was not provided to purchaser and
such current prospectus would have cured the defect giving rise to such
loss, claim, damage or liability and was in fact previously furnished to
the Shareholder and the managing Underwriters, if any, in quantities
sufficient to deliver the same to all such purchasers. The Company also
agrees to indemnify any Underwriters of the Registrable Securities, their
officers and directors and each person who controls such Underwriters on
substantially the same basis as that of the indemnification of Shareholder
provided in this Section 4.1.
4.2. Indemnification by Shareholder. Shareholder agrees to
------------------------------
indemnify and hold harmless the Company, its officers and directors, and
each Person, if any, who controls the Company within the meaning of either
Section 15 of the 1933 Act or Section 20 of the 1934 Act to the same
extent as the foregoing indemnity from the Company to Shareholder, but
only with reference to information relating to Shareholder or the plan of
distribution furnished in writing by or on behalf of Shareholder expressly
for use in any registration statement or prospectus relating to the
Registrable Securities, or any amendment or supplement thereto, or any
preliminary prospectus. Shareholder also agrees to indemnify and hold
harmless any Underwriters of the Registrable Securities, their officers
and directors and each person who controls such Underwriters on
substantially the same basis as that of the indemnification of the Company
provided in this Section 4.2.
4.3. Conduct of Indemnification Proceedings. In case any
--------------------------------------
proceeding (including any governmental investigation) shall be instituted
involving any Person in respect of which indemnity may be sought pursuant
to Section 4.1 or Section 4.2, such Person (the "Indemnified Party") shall
promptly notify the Person against whom such indemnity may be sought (the
"Indemnifying Party") in writing and the Indemnifying Party, upon the
request of the Indemnified Party, shall retain counsel reasonably
satisfactory to such Indemnified Party to represent such Indemnified Party
and any others the Indemnifying Party may designate in such proceeding and
shall pay the fees and disbursements of such counsel related to such
proceeding. In any such proceeding, any Indemnified Party shall have the
right to retain its own counsel, but the fees and expenses of such counsel
shall be at the expense of such Indemnified Party unless (i) the
Indemnifying Party and the Indemnified Party shall have mutually agreed to
the retention of such counsel or (ii) the named parties to any such
proceeding (including any impleaded parties) include both the Indemnified
Party and the Indemnifying Party and representation of both parties by the
same counsel would be inappropriate due to actual or potential differing
interests between them. It is understood that the Indemnifying Party
shall not, in connection with any proceeding or related proceedings in the
same jurisdiction, be liable for the fees and expenses of more than one
separate firm of attorneys (in addition to any local counsel) at any time
for all such Indemnified Parties, and that all such fees and expenses
shall be reimbursed as they are incurred. In the case of any such
separate firm for the Indemnified Parties, such firm shall be designated
in writing by the Indemnified Parties. The Indemnifying Party shall not
be liable for any settlement of any proceeding effected without its
written consent, but if settled with such consent, or if there be a final
judgment for the plaintiff, the Indemnifying Party shall indemnify and
hold harmless such Indemnified Parties from and against any loss or
liability (to the extent stated above) by reason of such settlement or
judgment.
4.4. Contribution. If the indemnification provided for in this
------------
Article IV is unavailable to an Indemnified Party in respect of any
losses, claims, damages or liabilities referred to herein, then in lieu of
such indemnification (i) as between the Company, on the one hand, and the
Shareholder, on the other hand, the Company and Shareholder shall
contribute to the aggregate losses, liabilities, claims, damages and
expenses of the nature contemplated by such indemnity incurred by the
Company and Shareholder, as incurred, in such proportion as is appropriate
to reflect the relative fault of the Company, on the one hand, and of
Shareholder, on the other hand, in connection with the statements or
omissions which resulted in such losses, liabilities, claims, damages or
expenses, as well as any other relevant equitable considerations and (ii)
as between the Company and the Shareholder, on the one hand, and the
Underwriters or agents, on the other hand, the Company, Shareholder,
Underwriters and agents shall contribute to such aggregate losses,
liabilities, claims, damages and expenses in proportion such that (x) the
Underwriters and agents are responsible for that portion represented by
the percentage that the underwriting discounts and commissions for the
offering appearing on the cover page of the relevant prospectus (or, if
not set forth on the cover page, that are applicable to the relevant
offering) bear to the initial public offering price appearing on the cover
page (or, if not set forth on the cover page, that are applicable to the
offering), and (y) Shareholder and the Company are responsible to
contribute pro rata, based upon the amount of net proceeds realized by
each, in respect of the balance.
The relative fault of the Company on the one hand and
Shareholder on the other hand shall be determined by reference to, among
other things, whether any such untrue or alleged untrue statement of a
material fact or omission or alleged omission to state a material fact
relates to information supplied by the Company or by Shareholder and the
parties' relative intent, knowledge, access to information and opportunity
to correct or prevent such statement or omission.
The Company and Shareholder agree that it would not be just and
equitable if contribution pursuant to this Section 4.4 were determined by
pro rata allocation or by any other method of allocation that does not
take account of the equitable considerations referred to in the
immediately preceding paragraph. The amount paid or payable by an
Indemnified Party as a result of the losses, claims, damages or
liabilities referred to in the immediately preceding paragraph shall be
deemed to include, subject to the limitations set forth above, any legal
or other expenses reasonably incurred by such Indemnified Party in
connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this Article IV, no Underwriter shall be
required to contribute any amount in excess of the amount by which the
total price at which the Securities underwritten by it and distributed to
the public were offered to the public exceeds the amount of any damages
which such Underwriter has otherwise been required to pay by reason of
such untrue or alleged untrue statement or omission or alleged omission,
and Shareholder shall not be required to contribute any amount in excess
of the amount by which the net proceeds of the offering (before deducting
expenses) received by Shareholder exceeds the amount of any damages which
Shareholder has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission. No person
guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the 1933 Act) shall be entitled to contribution from any Person
who was not guilty of such fraudulent misrepresentation.
ARTICLE V
MISCELLANEOUS
5.1. Participation in Underwritten Registrations. No Person
-------------------------------------------
may participate in any underwritten registered offering contemplated hereunder
unless such Person (a) agrees to sell its securities on the basis provided
in any underwriting arrangements approved by the Persons entitled
hereunder to approve such arrangements and (b) completes and executes all
questionnaires, powers of attorney, underwriting agreements and other
documents reasonably required under the terms of such underwriting
arrangements and these Registration Rights.
5.2. Rule 144. The Company covenants that it will file any
--------
reports required to be filed by it under the 1933 Act and the 1934 Act and
that it will take such further action as Shareholder may reasonably
request to the extent required from time to time to enable Shareholder to
sell Registrable Securities without registration under the 1933 Act within
the limitation of the exemptions provided by Rule 144 under the 1933 Act,
as such Rule may be amended from time to time, or any similar rule or
regulation hereafter adopted by the Commission. Upon the request of
Shareholder, the Company will deliver to Shareholder a written statement
as to whether it has complied with such reporting requirements.
5.3. Holdback Agreements. Shareholder agrees not to offer,
-------------------
sell, contract to sell or otherwise dispose of any Registrable Securities, or
any securities convertible into or exchangeable or exercisable for such
securities, including any sale pursuant to Rule 144 under the 1933 Act,
during the 14 days prior to, and during the 90-day period beginning on,
the effective date of a registration statement for any shares of Common
Stock or Preferred Stock.
5.4. Transfer of Registration Rights. None of the rights of
-------------------------------
Shareholder under this Agreement shall be assignable by Shareholder,
except to "Permitted Transferees" as defined under the Articles of
Incorporation of Adonis.
5.5. Notices. All notices, requests and other communications
-------
to either party hereunder shall be in writing (including telecopy or similar
writing) and shall be given,
if to the Company, to:
Butterfly, Inc.
c/o Aetna Life and Casualty Company
151 Farmington Avenue
Hartford, CT 06156-7505
Telecopier: 860-549-6755
Attention: Richard L. Huber
Vice Chairman
and
Butterfly, Inc.
c/o U.S. Healthcare, Inc.
980 Jolly Road
P.O. Box 1109
Blue Bell, PA 19422
Telecopier: 215-283-6401
Attention: David Simon
with a copy to:
David L. Caplan
Davis Polk & Wardwell
450 Lexington Avenue
New York, New York 10017
Telecopy: (212) 450-4800
if to Shareholder, to:
Leonard Abramson
c/o U.S. Healthcare, Inc.
980 Jolly Road
P.O. Box 1109
Blue Bell, PA 19422
Telecopier: 215-283-6858
with a copy to:
Howard S. Godwin, Jr.
Brown & Wood LLP
One World Trade Center
New York, New York 10048
Telecopy: (212) 839-5599
or such other address or telecopier number as such party may hereafter
specify for the purpose by notice to the other party hereto. Each such
notice, request or other communication shall be effective when delivered
at the address specified in this Section 5.5.
5.6. Amendments; No Waivers.
----------------------
(a) Any provision of this Agreement may be amended or waived
if, and only if, such amendment or waiver is in writing and signed, in the
case of an amendment, by Shareholder and the Company, or in the case of a
waiver, by the party against whom the waiver is to be effective.
(b) No failure or delay by any party in exercising any right,
power or privilege hereunder shall operate as a waiver thereof nor shall
any single or partial exercise thereof preclude any other or future
exercise thereof or the exercise of any other right, power or privilege.
The rights and remedies herein provided shall be cumulative and not
exclusive of any rights or remedies provided by law.
5.7. Successors and Assigns. The provisions of this Agreement
----------------------
shall be binding upon and inure to the benefit of the parties hereto and
their respective successors and assigns. Neither this Agreement nor any
provision hereof is intended to confer upon any Person other than the
parties hereto any rights or remedies hereunder.
5.8. Counterparts; Effectiveness. This Agreement may be signed
---------------------------
in any number of counterparts. each of which shall be an original, with
the same effect as if the signatures thereto and hereto were upon the same
instrument. This Agreement shall become effective when each party hereto
shall have received a counterpart hereof signed by the other party hereto.
5.9. Entire Agreement. This Agreement constitutes the entire
----------------
agreement between the parties with respect to the subject matter hereof
and supersede all prior agreements, understandings and negotiations, both
written and oral, between the parties with respect thereto. No
representation, inducement, promise, understanding, condition or warranty
not set forth herein or therein has been made or relied upon by any of the
parties hereto.
5.10. Governing Law. This Agreement shall be construed in
-------------
accordance with and governed by the laws of the State of New York, without
regard to the conflicts of law rules of such state.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed as of the day and year first above written.
BUTTERFLY, INC.
By: /s/ Richard Huber
--------------------
Name: Richard Huber
Title: Vice President
________________________
LEONARD ABRAMSON
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed as of the day and year first above written.
BUTTERFLY, INC.
By:___________________
Name:
Title:
/s/ Leonard Abramson
----------------------
LEONARD ABRAMSON
AMENDMENT NO. 1 TO REGISTRATION RIGHTS AGREEMENT
AMENDMENT (this "AGREEMENT") dated as of May 30, 1996 to the
Registration Rights Agreement dated as of March 30, 1996 (the "REGISTRATION
RIGHTS AGREEMENT") between Aetna Inc., a Connecticut corporation (formerly
known as Butterfly, Inc.) (the "COMPANY") and Leonard Abramson (the
"SHAREHOLDER").
The parties hereto agree as follows:
ARTICLE I. Amendment of Section 1.1. The definition of "Merger
------------------------
Agreement" in Section 1.1 of the Registration Rights Agreement is amended to
read as follows:
"MERGER AGREEMENT" means the Agreement and Plan of Merger dated as
of March 30, 1996 among Aetna Life and Casualty Company, a Connecticut
insurance corporation, U.S. Healthcare, Inc., a Pennsylvania corporation, the
Company, Antelope Sub, Inc., a Connecticut corporation, and New Merger
Corporation, a Pennsylvania corporation, as the same may be amended from time
to time.
ARTICLE II. Amendment of Section 3.1(b). Subparagraph 3.1(b) of
---------------------------
the Registration Rights Agreement is amended to read as follows:
(b) The Company will, if requested, prior to filing the Shelf
Registration Statement or any amendment or supplement thereto (but not
including any document incorporated by reference in the Shelf Registration
Statement), furnish to Shareholder and each applicable managing Underwriter,
if any, without charge, copies thereof, and thereafter furnish to Shareholder
and each such Underwriter, if any, without charge, such number of copies of
such registration statement, amendment and supplement thereto (including all
exhibits thereto and any document incorporated by reference in the Shelf
Registration Statement) and the prospectus included in such registration
statement (including each preliminary prospectus) as Shareholder or each such
Underwriter may reasonably request in order to facilitate the sale of the
Registrable Securities.
ARTICLE III. Amendment of Section 5.3. Section 5.3 of the
------------------------
Registration Rights Agreement is amended to read as follows:
5.3. Holdback Agreements. Shareholder agrees not to offer, sell,
-------------------
contract to sell or otherwise dispose of any Registrable Securities, or any
securities convertible into or exchangeable or exercisable for such
securities, including any sale pursuant to Rule 144 under the 1933 Act,
during the 14 days prior to, and during the 90-day period beginning on, the
effective date of a registration statement for any shares of Common Stock or
Preferred Stock (other than (a) the Shelf Registration Statement, (b) any
registration statement on Form S-8 or (c) a registration statement on Form
S-4 relating to the transactions contemplated by the Merger Agreement);
provided that, notwithstanding this Section 5.3, Shareholder may sell
- --------
Registrable Securities pursuant to and in accordance with Sections 2.2 and
2.3.
ARTICLE IV. Amendment of Section 5.4. Section 5.4 of the
------------------------
Registration Rights Agreement is amended by replacing the word "Adonis" with
the words "U.S. Healthcare".
ARTICLE V. Amendment of Section 5.5. Section 5.5 of the
------------------------
Registration Rights Agreement is amended to read as follows:
5.5. Notices. All notices, requests and other communications to
-------
either party hereunder shall be in writing (including telecopy or similar
writing) and shall be given.
if to the Company, to:
Aetna Inc.
c/o Aetna Life and Casualty Company
151 Farmington Avenue
Hartford, CT 06156-7505
Telecopier: 860-549-6755
Attention: Richard L. Huber
Vice Chairman
and
Aetna Inc.
c/o U.S. Healthcare, Inc.
980 Jolly Road
P.O. Box 1109
Blue Bell, PA 19422
Telecopier: 215-283-6401
Attention: David Simon
with a copy to:
Davis Polk & Wardwell
450 Lexington Avenue
New York, New York 10017
Telecopier: 212-450-4800
Attention: David L. Caplan
if to Shareholder, to:
Leonard Abramson
376 Regatta Drive
Jupiter, FL 33477
Telecopier: 407-745-1114
with a copy to:
Brown & Wood LLP
One World Trade Center
New York, New York 10048
Telecopier: 212 -839-5599
Attention: Howard G. Godwin, Jr.
or such other address or telecopier number as such party may hereafter
specify for the purpose by notice to the other party hereto. Each such
notice, request or other communication shall be effective when delivered at
the address or telecopy number specified in this Section 5.5.
ARTICLE VI. Governing Law. This Agreement shall be construed in
-------------
accordance with and governed by the laws of the State of New York, without
regard to the conflicts of law rules of such state.
ARTICLE VII. Counterparts. This Agreement may be signed in any
------------
number of counterparts, each of which shall be an original, with the same
effect as if the signatures thereto and hereto were upon the same instrument.
ARTICLE VIII. Force and Effect. Except as expressly amended
----------------
hereby, the Registration Rights Agreement shall remain in full force and
effect.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be duly executed as of the day and year first above written.
AETNA INC. (formerly
known as Butterfly, Inc.)
By: /s/ Richard Huber
--------------------
Name: Richard Huber
Title: Vice President
________________________
LEONARD ABRAMSON
IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be duly executed as of the day and year first above written.
AETNA INC. (formerly
known as Butterfly, Inc.)
By: ----------------------
Name: Richard Huber
Title: Vice President
/s/ Leonard Abramson
-------------------------
LEONARD ABRAMSON
