Cigna 2008 Annual Report Download - page 170

FS-7
CIGNA CORPORATION AND SUBSIDIARIES
SCHEDULE II
CONDENSED FINANCIAL INFORMATION OF CIGNA CORPORATION
(REGISTRANT)
NOTES TO CONDENSED FINANCIAL STATEMENTS
The accompanying condensed financial statements should be read in conjunction with the Consolidated Financial Statements and
the accompanying notes thereto in the Annual Report.
Note 1—For purposes of these condensed financial statements, CIGNA Corporation’s (the Company) wholly owned subsidiaries are
recorded using the equity basis of accounting. Certain reclassifications have been made to prior years’ amounts to conform
to the 2008 presentation.
Note 2—On April 25, 2007, the Company’s Board of Directors approved a three-for-one stock split (in the form of a stock dividend)
of the Company’s common shares. The stock split was effective on June 4, 2007 for shareholders of record as of the close of
business on May 21, 2007.
Note 3—Short-term and long-term debt consisted of the following at December 31:
(In millions) 2008 2007
Short-term:
Commercial Paper $ 299 $ -
Total short-term debt $ 299 $ -
Long-term:
Uncollateralized debt:
7% Notes due 2011 $ 222 $ 222
6.375% Notes due 2011 226 226
5.375% Notes due 2017 250 250
6.35% Notes due 2018 300 -
7.65% Notes due 2023 100 100
8.3% Notes due 2023 17 17
7.875 % Debentures due 2027 300 300
8.3% Step Down Notes due 2033 83 83
6.15% Notes due 2036 500 500
Total long-term debt $ 1,998 $ 1,698
Under a universal shelf registration statement filed with the Securities and Exchange Commission (SEC), the Company
issued $300 million of 6.35% Notes on March 4, 2008 (with an effective interest rate of 6.68% per year). Interest is payable
on March 15 and September 15 of each year beginning September 15, 2008. These Notes will mature on March 15, 2018.
The Company may redeem these Notes, at any time, in whole or in part, at a redemption price equal to the greater of:
• 100% of the principal amount of the Notes to be redeemed; or
• the present value of the remaining principal and interest payments on the Notes being redeemed discounted at the
applicable Treasury Rate plus 40 basis points.
On March 14, 2008, the Company entered into a new commercial paper program (“the Program”). Under the Program, the
Company is authorized to sell from time to time short-term unsecured commercial paper notes up to a maximum of $500
million. The proceeds are used for general corporate purposes, including working capital, capital expenditures, acquisitions
and share repurchases. The Company uses the credit facility entered into in June 2007, as back-up liquidity to support the
outstanding commercial paper. If at any time funds are not available on favorable terms under the Program, the Company
may use its credit agreement for funding. In October 2008, the Company added an additional dealer to its Program. As of
December 31, 2008, the Company had $299 million in commercial paper outstanding, at a weighted average interest rate of
6.31%, used to finance the Great-West Healthcare acquisition and for other corporate purposes.