Cigna 2013 Annual Report Download - page 159

PART IV
ITEM 15. Exhibits and Financial Statement Schedules
Cigna Corporation and Subsidiaries
Schedule II – Condensed Financial Information of Cigna Corporation (Registrant)
The accompanying condensed financial statements should be read in Note 1 – For purposes of these condensed financial statements, Cigna
conjunction with the Consolidated Financial Statements and the Corporation’s (the Company) wholly owned and majority owned
accompanying notes thereto contained in this Form 10-K. subsidiaries are recorded using the equity basis of accounting.
Note 2 – Short-term and long-term debt consisted of the following at December 31:
(In millions) December 31, 2013 December 31, 2012
Short-term:
Commercial Paper $ 100 $ 200
TOTAL SHORT-TERM DEBT $ 100 $ 200
Long-term:
Uncollateralized debt:
2.75% Notes due 2016 $ 600 $ 600
5.375% Notes due 2017 250 250
6.35% Notes due 2018 131 131
8.5% Notes due 2019 251 251
4.375% Notes due 2020 249 249
5.125% Notes due 2020 299 299
4.5% Notes due 2021 299 299
4% Notes due 2022 744 743
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
5.875% Notes due 2041 298 298
5.375% Notes due 2042 750 750
TOTAL LONG-TERM DEBT $ 4,871 $ 4,870
In December 2012, the Company extended the life of its June 2011 $750 million of 10-Year Notes due February 15, 2022 at a stated
five-year revolving credit and letter of credit agreement for interest rate of 4% ($743 million, net of discount, with an effective
$1.5 billion that permits up to $500 million to be used for letters of interest rate of 4.346% per year) and $750 million of 30-Year Notes
credit. This agreement is diversified among 16 banks, with 3 banks due February 15, 2042 at a stated interest rate of 5.375%
having approximately 35% of the commitment and the remainder ($750 million, net of discount, with an effective interest rate of
spread among 13 banks. The credit agreement includes options that 5.542% per year). Interest is payable on May 15 and November 15 of
are subject to consent by the administrative agent and the committing each year beginning May 15, 2012 for the 5-Year Notes and
banks, to increase the commitment amount to $2 billion and to February 15 and August 15 of each year beginning February 15, 2012
extend the term past December 2017. The credit agreement is for the 10-Year and 30-Year Notes. The proceeds of this debt were
available for general corporate purposes, including as a commercial used to fund the HealthSpring acquisition in 2012.
paper backstop and for the issuance of letters of credit. This agreement The Company may redeem these Notes, at any time, in whole or in
has certain covenants, including a financial covenant requiring the part, at a redemption price equal to the greater of:
Company to maintain a total debt-to-adjusted capital ratio at or
below 0.50 to 1.00. As of December 31, 2013, the Company had 100% of the principal amount of the Notes to be redeemed; or
$6.0 billion of borrowing capacity within the maximum debt coverage the present value of the remaining principal and interest payments
covenant in the agreement in addition to the $5.2 billion of debt on the Notes being redeemed discounted at the applicable Treasury
outstanding. There were letters of credit of $39 million issued as of Rate plus 30 basis points (5-Year 2.75% Notes due 2016), 35 basis
December 31, 2013. points (10-Year 4% Notes due 2022), or 40 basis points (30-Year
On November 10, 2011, the Company issued $2.1 billion of 5.375% Notes due 2042).
long-term debt as follows: $600 million of 5-Year Notes due In March 2011, the Company issued $300 million of 10-Year Notes
November 15, 2016 at a stated interest rate of 2.75% ($600 million, due March 15, 2021 at a stated interest rate of 4.5% ($298 million,
net of discount, with an effective interest rate of 2.936% per year),
CIGNA CORPORATION - 2013 Form 10-K FS-7
Notes to Condensed Financial Statements
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