Aetna 8-K 2006
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
(Exact name of registrant as specified in its charter)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
TABLE OF CONTENTS
Section 1 Registrants Business and Operations
At a meeting on January 3, 2006, Aetna Inc.s (Aetnas) Board of Directors named John W. Rowe, M.D., Aetnas executive Chairman of the Board effective February 14, 2006. Dr. Rowe will retire from Aetna by the end of 2006. In connection with this change, on January 3, 2006, Aetna and Dr. Rowe entered into an amendment to Dr. Rowes existing employment agreement (the Amendment). See Item 5.02(b) below. The Amendment was approved by the Committee on Compensation and Organization of the companys Board of Directors, which consists solely of independent directors.
The key terms of the Amendment are as follows:
Section 5 Corporate Governance and Management
(b) At a meeting on January 3, 2006, Aetna Inc.s (Aetnas) Board of Directors named John W. Rowe, M.D., Aetnas executive Chairman of the Board effective February 14, 2006. Dr. Rowe, age 61, has been Aetnas Chief Executive Officer since December 13, 2000, and its Chairman since April 1, 2001, and will retire from Aetna by the end of 2006.
(c) At a meeting on January 3, 2006, Aetnas Board of Directors named Ronald A. Williams Aetnas President and Chief Executive Officer effective February 14, 2006. Mr. Williams, age 56, has been a Director of Aetna since September 27, 2002. Mr. Williams became President of Aetna on May 27, 2002, having served as Aetnas Executive Vice President and Chief of Health Operations since March 15, 2001. Prior to joining Aetna, Mr. Williams held various executive positions from 1987 to 2001 at WellPoint Health Networks Inc. and its Blue Cross of California subsidiary. From October 1995 to March 1999, he served as Executive Vice President of the Blue Cross of California Businesses of WellPoint and as President of its Blue Cross of California subsidiary, and from April 1999 to March 2001, he served as Executive Vice President, Large Group Businesses, of WellPoint and as Group President of WellPoints Large Group Division. Mr. Williams is a director of Lucent Technologies Inc. (networks for communications service providers) and is a trustee of The Conference Board. He also serves on the Deans Advisory Council and the Corporate Visiting Committee at the Massachusetts Institute of Technology and has been elected a member of MITs Alfred P. Sloan Management Society.
The terms of Mr. Williams employment agreement dated December 5, 2003, were previously described in Aetnas proxy statement dated March 21, 2005. Under the agreement, which is for a remaining term ending December 31, 2006, with one-year extensions running through 2013, Mr. Williams is entitled to an annual salary of not less than $1,000,000, a target annual bonus opportunity of at least 120% of base salary and a maximum annual bonus opportunity of at least 200% of base salary. In addition to certain other benefits, Mr. Williams will vest in a pension benefit in five equal annual installments beginning on April 2, 2001, and for each of calendar years 2005 through 2010, Mr. Williams will receive an additional fully vested pension accrual in an amount equal to his base salary for such year. This additional pension accrual will not be credited if Mr. Williams is not actively employed by Aetna and will be offset by the value of Mr. Williams vested benefit under his prior employers pension plan. If Aetna terminates Mr. Williams employment other than for cause (as defined in the agreement), death or disability, or Mr. Williams terminates his employment for good reason (as defined in the agreement), he will be entitled to 104 weeks (156 weeks if such termination is within two years following a change-in-control) of cash compensation (calculated as annual base salary and target annual bonus) and his pro rata bonus for the year of termination. Aetna has agreed generally to make Mr. Williams whole for certain excise taxes incurred as a result of payments made under his agreement or otherwise. Mr. Williams also participates in Aetnas incentive programs, which are described in more detail in Aetnas proxy statement dated March 21, 2005. Mr. Williams employment agreement was filed as Exhibit 10.24 to Aetnas Form 10-K filed on February 27, 2004.
The Committee on Compensation and Organization set Mr. Williams 2005 salary at $1,000,000, the same as for 2004. Mr. Williams compensation for 2006 has not yet been established.
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.