-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, UebZkH4s1iZ+qWGtAalVFMAWk7t74rIyh9Bx22uLEifBe+Lrp2hQ4aM9i/QGFyyi JAjJq8Ew8ruJUq2D5TagBQ== 0000950130-98-003290.txt : 19980626 0000950130-98-003290.hdr.sgml : 19980626 ACCESSION NUMBER: 0000950130-98-003290 CONFORMED SUBMISSION TYPE: T-3 PUBLIC DOCUMENT COUNT: 9 FILED AS OF DATE: 19980624 SROS: NYSE SROS: PHLX SROS: PCX FILER: COMPANY DATA: COMPANY CONFORMED NAME: CIGNA CORP CENTRAL INDEX KEY: 0000701221 STANDARD INDUSTRIAL CLASSIFICATION: FIRE, MARINE & CASUALTY INSURANCE [6331] IRS NUMBER: 061059331 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: T-3 SEC ACT: SEC FILE NUMBER: 022-22383 FILM NUMBER: 98653574 BUSINESS ADDRESS: STREET 1: ONE LIBERTY PLACE 1650 MARKET ST STREET 2: PO BOX 7716 CITY: PHILADELPHIA STATE: PA ZIP: 19192-1550 BUSINESS PHONE: 2157616211 MAIL ADDRESS: STREET 1: TWO LIBERTY PLACE 48TH FLOOR STREET 2: 1601 CHESTNUT STREET CITY: PHILADELPHIA STATE: PA ZIP: 19192 T-3 1 FORM T-3 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM T-3 FOR APPLICATIONS FOR QUALIFICATION OF INDENTURES UNDER THE TRUST INDENTURE ACT OF 1939 CIGNA CORPORATION ----------------- (Name of Company) One Liberty Place 1650 Market Street Philadelphia, PA 19192 ---------------------- (Address of Principal Executive Offices) SECURITIES TO BE ISSUED UNDER THE INDENTURE TO BE QUALIFIED TITLE OF CLASS AMOUNT -------------- ------ Notes due January 15, 2033 $100,000,000 Approximate date of proposed public offering: June 24, 1998 Name and address of agent for service: Thomas J. Wagner Executive Vice President and General Counsel CIGNA Corporation One Liberty Place Philadelphia, PA 19192 The Company hereby amends this application for qualification on such date or dates as may be necessary to delay its effectiveness until (i) the 20th day after the filing of a further amendment, which specifically states that it shall supersede this amendment, or (ii) such date as the Securities and Exchange Commission, acting pursuant to Section 307(c) of the Act, may determine upon the written request of the Company. GENERAL ------- 1. General information. ------------------- (a) Form of organization: Corporation. (b) State or other sovereign power under the laws of which organized: Delaware. 2. Securities Act exemption applicable. CIGNA Corporation, a Delaware ----------------------------------- corporation (the "Company"), is relying upon the exemption from the registration requirements of the Securities Act of 1933, as amended (the "Securities Act"), provided by Section 3(a)(9) thereunder, in connection with the Company's exchange offer as described herein (the "Exchange Offer"). The Exchange Offer is being made by the Company pursuant to its Offering Circular dated June 24, 1998 ("Offering Circular"), and the related Letter of Transmittal and Notice of Guaranteed Delivery of even date therewith, and consists of an offer to exchange up to $100,000,000 of the Company's Notes Due 2033 (the "New Notes") for the Company's outstanding $100,000,000 8.30% Notes Due 2023 (the "Old Notes"). There have not been any sales of securities of the same class as the New Notes or the Old Notes by the Company, nor are there any such other sales planned, by or through an underwriter at or about the time of the Exchange Offer transaction. The Company retained Donaldson, Lufkin & Jenrette Securities Corporation ("DLJ") to advise the Company as to the structure, process and financial matters related to the Exchange Offer. DLJ's services to the Company are limited solely to such advisory services, and DLJ will not, directly or indirectly, solicit the exchange of Old Notes for New Notes under the Exchange Offer or otherwise make recommendations with respect to acceptance or rejection of the Exchange Offer. In exchange for such advisory services, DLJ will be paid a flat fee upon consummation of the transaction. The fee will not be based upon the level of participation in the Exchange Offer. DLJ will not be paid any commission or similar variable type of remuneration. The Company also has retained MacKenzie Partners, Inc. as the "Information Agent" and IBJ Schroder Bank & Trust Company as the "Exchange Agent" in connection with the Exchange Offer. The Information Agent and Exchange Agent will provide to holders of Old Notes only information otherwise contained in the Offering Circular and general information regarding the mechanics of the exchange process. The Exchange Agent will provide the actual acceptance and exchange services with respect to the exchange of Old Notes and New Notes. Neither the Information Agent nor the Exchange Agent will solicit exchanges in connection with the Exchange Offer or make recommendations as to the acceptance or rejection of the Exchange Offer. Both the Information Agent and Exchange Agent will be paid reasonable fees directly by the Company for their services. Cash payments in the form of a participation fee will be paid to Holders that tender and do not withdraw their Old Notes and whose Old Notes are accepted for exchange by the Company. Such participation will be equal to 1.50% of the principal amount of Old Notes tendered. Holders that do not tender Old Notes are not eligible to receive a participation fee. 2 There are no cash payments made or to be made by any holder of the outstanding Old Notes in connection with the Exchange Offer. AFFILIATION ----------- 3. Affiliates. Furnish a list or diagram of all affiliates of the Company and ---------- indicate the respective percentages of voting securities or other bases of control. Below is a list of direct and indirect subsidiaries of the Company as of December 31, 1997, unless otherwise indicated all of the subsidiaries are wholly-owned. The names of certain subsidiaries, which if considered in the aggregate as a single subsidiary would not constitute a significant subsidiary, are omitted. CIGNA Holdings, Inc. (Delaware) I. Connecticut General Corporation (Connecticut) A. CG Trust Company (Illinois) B. CIGNA Associates, Inc. (Connecticut) C. CIGNA Dental Health, Inc. (Florida) (1) CIGNA Dental Health of California, Inc. (California) (2) CIGNA Dental Health of Colorado, Inc. (Colorado) (3) CIGNA Dental Health of Delaware, Inc. (Delaware) (4) CIGNA Dental Health of Florida, Inc. (Florida) (5) CIGNA Dental Health of Illinois, Inc. (Illinois) (6) CIGNA Dental Health of Kansas, Inc. (Kansas) (7) CIGNA Dental Health of Kentucky, Inc. (Kentucky) (8) CIGNA Dental Health of Maryland, Inc. (Delaware) (9) CIGNA Dental Health of New Jersey, Inc. (New Jersey) (10) CIGNA Dental Health of New Mexico, Inc. (New Mexico) (11) CIGNA Dental Health of North Carolina, Inc. (North Carolina) (12) CIGNA Dental Health of Ohio, Inc. (Ohio) (13) CIGNA Dental Health of Pennsylvania, Inc. (Pennsylvania) (14) CIGNA Dental Health of Texas, Inc. (Texas) (15) CIGNA Dental Health Plan of Arizona, Inc. (Arizona) D. CIGNA Financial Advisors, Inc. (Connecticut) E. CIGNA Financial Services, Inc. (Delaware) F. CIGNA Health Corporation (Delaware) (1) Healthsource, Inc. (New Hampshire) (a) Healthsource Connecticut Ventures, Inc. (Connecticut) (i) Healthsource Connecticut, Inc. (Connecticut) (b) Healthsource Health Plans, Inc. (North Carolina) (i) Healthsource North Carolina, Inc. (North Carolina) (ii) Healthsource North Carolina Administrators, Inc. (North Carolina) (c) Healthsource Indiana, Inc. (New Hampshire) (i) Healthsource Indiana Insurance Company (Indiana) (ii) Healthsource Indiana Managed Care Plan, Inc. (Indiana) (d) Healthsource Insurance Group, Inc. (New Hampshire) (e) Healthsource Kentucky Ventures, Inc. (Kentucky) (i) Healthsource Kentucky, Inc. (Kentucky) (ii) Healthsource Kentucky Preferred, Inc. (Kentucky) 3 (f) Healthsource Maine, Inc. (Maine) (g) Healthsource Maine Preferred, Inc. (New Hampshire) (h) Healthsource Management, Inc. (New Hampshire) (i) Healthsource Syracuse, Inc. (New York) (a) Healthsource New York, Inc. (New York) (i) Healthsource HMO of New York, Inc. (New York) (ii) Healthsource Preferred of New York, Inc. (New York) (ii) Healthsource Tennessee, Inc. (Tennessee) (iii) Healthsource Tennessee Preferred, Inc. (Tennessee) (i) Healthsource Massachusetts, Inc. (Massachusetts) (j) Healthsource Metropolitan New York Holding Company, Inc. (New Hampshire) (i) Healthsource New York/New Jersey, Inc. (New York) (k) Healthsource New Hampshire, Inc. (New Hampshire) (l) Healthsource Ohio Ventures, Inc. (Ohio) (i) Healthsource Ohio, Inc. (Ohio) (ii) Healthsource Ohio Preferred, Inc. (Ohio) (m) Healthsource Rhode Island, Inc. (Rhode Island) (n) Healthsource RX, Inc. (New Hampshire) (o) Healthsource South, Inc. (New Hampshire) (i) Healthsource Arkansas Ventures, Inc. (Arkansas) (70% with balance owned by non-affiliate) (a) Healthsource Arkansas, Inc. (Arkansas) (b) Healthsource Arkansas Preferred, Inc. (Arkansas) (ii) Healthsource Insurance Company (Tennessee) (iii) Healthsource Physicians Group of South Carolina, Inc. (South Carolina) (iv) Healthsource Provident Administrators, Inc. (v) Healthsource Texas, Inc. (Texas) (vi) HS North Texas Ventures, Inc. (Texas) (a) Healthsource North Texas, Inc. (Texas) (vii) Provident Health Care Plans, Inc. (Tennessee) (a) Healthsource Georgia, Inc. (Georgia) (b) Provident Health Care Plan, Inc. of North Carolina (North Carolina) (c) Provident Health Care Plan, Inc. of Tennessee (Tennessee) (p) Physicians' Health Systems, Inc. (South Carolina) (i) Healthsource Insurance Services, Inc. (South Carolina) (72% with balance owned by another CIGNA subsidiary) (ii) Healthsource South Carolina, Inc. (South Carolina) (2) CIGNA HealthCare of Arizona, Inc. (Arizona) (a) CIGNA Community Choice, Inc. (Arizona) (3) CIGNA HealthCare of California, Inc. (California) (4) CIGNA HealthCare of Colorado, Inc. (Colorado) (5) CIGNA HealthCare of Connecticut, Inc. (Connecticut) (6) CIGNA HealthCare of Delaware, Inc. (Delaware) (7) CIGNA HealthCare of Florida, Inc. (Florida) (8) CIGNA HealthCare of Georgia, Inc. (Georgia) (9) CIGNA HealthCare of Illinois, Inc. (Delaware) (99.60% with balance owned by non-affiliate) (10) CIGNA Healthplan of Louisiana, Inc. (Louisiana) (11) CIGNA HealthCare of Massachusetts, Inc. (Massachusetts) 4 (12) CIGNA HealthCare Mid-Atlantic, Inc. (Maryland) (13) CIGNA HealthCare of New Jersey, Inc. (New Jersey) (14) CIGNA HealthCare of New York, Inc. (New York) (15) CIGNA HealthCare of North Carolina, Inc. (North Carolina) (16) CIGNA HealthCare of North Louisiana, Inc. (Louisiana) (17) CIGNA HealthCare of Northern New Jersey, Inc. (New Jersey) (18) CIGNA HealthCare of Ohio, Inc. (Ohio) (19) CIGNA HealthCare of Oklahoma, Inc. (Oklahoma) (20) CIGNA HealthCare of Pennsylvania, Inc. (Pennsylvania) (21) CIGNA HealthCare of St. Louis, Inc. (Missouri) (22) CIGNA HealthCare of Tennessee, Inc. (Tennessee) (23) CIGNA HealthCare of Texas, Inc. (Texas) (24) CIGNA HealthCare of Utah, Inc. (Utah) (25) CIGNA HealthCare of Virginia, Inc. (Virginia) (26) Lovelace Health Systems, Inc. (New Mexico) (27) Temple Insurance Company Limited (Bermuda) G. CIGNA RE Corporation (Delaware) H. Connecticut General Life Insurance Company (Connecticut) (1) All-Net Preferred Providers, Inc. (Delaware) (2) CIGNA Life Insurance Company (Connecticut) I. Disability Claim Services, Inc. (Delaware) J. Global Portfolio Strategies, Inc. (Connecticut) K. INA Life Insurance Company of New York (New York) L. International Rehabilitation Associates, Inc. d/b/a Intracorp (Delaware) M. Life Insurance Company of North America (Pennsylvania) (1) CIGNA Direct Marketing Company, Inc. (Delaware) (2) CIGNA Life Insurance Company of Canada (Canada) (3) INA Himawari Life Insurance Co., Ltd. (Japan) (90% with balance owned by non-affiliate) N. MCC Behavioral Care, Inc. (Minnesota) (1) MCC Behavioral Care of California, Inc. (California) O. TEL-DRUG, INC. (South Dakota) II. INA Corporation (Pennsylvania) A. CIGNA International Holdings, Ltd. (Delaware) (1) Afia Finance Corporation (Delaware) (a) CIGNA Brasil Participacoes Ltda. (Brazil) (i) AMICO Assistencia Medica A Industria E Comercio Ltda. (Brazil) (50% with balance owned by non-affiliate) (ii) Excel CIGNA Seguardora S.A. (Brazil) (50% with balance owned by non-affiliate) (b) CIGNA Reinsurance New Zealand Limited (New Zealand) (c) P. T. Asuransi CIGNA Indonesia (Indonesia) (53.51% with balance owned by non-affiliates) (2) CIGNA Argentina Compania de Seguros S.A. (Argentina) (3) CIGNA Brasil Empreendimentos Ltda. (Brazil) (a) INA Seguradora S.A. (Brazil) (85.80% with 13.79% owned by another CIGNA affiliate and balance owned by non-affiliates) (4) CIGNA Compania de Seguros (Chile) S.A. (Chile) (99.13% with balance owned by non-affiliates) (5) CIGNA G.B. Holdings, Ltd. (Delaware) 5 (a) CIGNA Reinsurance Company (UK) Limited (United Kingdom) (b) Insurance Company of North America (U.K.) Limited (United Kingdom) (6) CIGNA Insurance Asia Pacific Limited (Australia) (a) CIGNA Insurance Singapore Limited (Singapore) (7) CIGNA Insurance Company Limited (Rep. of South Africa) (8) CIGNA Insurance Company of Puerto Rico (Puerto Rico) (9) CIGNA Insurance New Zealand Limited (New Zealand) (a) CIGNA Life Insurance New Zealand Limited (New Zealand) (10) CIGNA International Corporation (Delaware) (a) CIGNA Eastern European Corporate Services Sp. z.o.o. (Poland) (11) CIGNA International Insurance Company of Hong Kong Limited (Hong Kong) (12) CIGNA Overseas Insurance Company Ltd. (Bermuda) (a) CIGNA Accident and Fire Insurance Company, Ltd. (Japan) (b) CIGNA China Investment Fund LDC (Cayman Islands) (67% with balance owned by another CIGNA subsidiary) (c) CIGNA Marketing Group, C.A. (Venezuela) (d) CIGNA Overseas Holdings, Inc. (Delaware) (i) CIGNA Insurance Company of Europe S.A.-N.V. (Belgium) (a) CIGNA Life Insurance Company of Europe S.A.-N.V. (Belgium) (b) CIGNA STU, S.A. (Poland) (49% with balance owned by non-affiliate) (c) CIGNA STU Zycie, S.A. (Poland) (51% with balance owned by non-affiliate) (13) CIGNA Worldwide Insurance Company (Delaware) (a) P.T. Asuransi Niaga CIGNA Life (Indonesia) (60% with balance owned by non-affiliate) (b) PCIB CIGNA Life Insurance Corporation (Philippines) (50% with balance owned by non-affiliate) (14) ESIS International, Inc. (Delaware) (15) INACAN Holdings, Ltd. (Canada) (a) CIGNA Insurance Company of Canada (Canada) (16) Inversiones INA Limitada (Chile) (98.6% with balance owned by another CIGNA subsidiary) (a) CIGNA Compania de Seguros de Vida (Chile) S.A. (Chile) (96.6% with balance owned by non-affiliate) (b) CIGNA Salud Isapre S.A. (Chile) (99.20% with balance owned by another CIGNA subsidiary) (17) LATINA Holdings, Ltd. (Delaware) (a) CIGNA Seguros de Colombia S.A. (Colombia) (85.76% with balance owned by other CIGNA subsidiaries and non-affiliate) (b) Empresa Guatemalteca CIGNA de Seguros, Sociedad Anonima (Guatemala) (97.375% with balance owned by non-affiliates) (18) Perdana CIGNA Insurance Berhard (Malaysia) (51% with balance owned by non-affiliate) (19) Seguros CIGNA, S.A. (Mexico) (92.98% with balance owned by non-affiliates) B. INA Financial Corporation (Delaware) (1) Brandywine Holdings Corporation (Delaware) (a) CIGNA International Reinsurance Company, Ltd. (Bermuda) (b) Century Indemnity Company (Pennsylvania) (i) Century Reinsurance Company (Pennsylvania) (ii) CIGNA Reinsurance Company (Pennsylvania) (a) CIGNA Reinsurance Company S.A.-N.V. (Belgium) (2) INA Holdings Corporation (Delaware) 6 (a) Bankers Standard Insurance Company (Pennsylvania) (i) Bankers Standard Fire & Marine Company (Pennsylvania) (b) CIGNA Property and Casualty Insurance Company (Connecticut) (i) ALIC, Incorporated (Texas) (a) CIGNA Lloyds Insurance Company (Texas) (ii) CIGNA Fire Underwriters Insurance Company (Pennsylvania) (iii) CIGNA Insurance Company (Pennsylvania) (a) Pacific Employers Insurance Company (Pennsylvania) (i) CIGNA Insurance Company of Texas (Texas) (ii) Illinois Union Insurance Company (Illinois) (iv) CIGNA Insurance Company of the Midwest (Indiana) (c) ESIS, Inc. (California) (d) INAC Corp. (Delaware) (e) INAC Corp. of California (California) (f) INAMAR Insurance Underwriting Agency, Inc. (New Jersey) (i) INAMAR Insurance Underwriting Agency, Inc. of Massachusetts (Massachusetts) (ii) INAMAR Insurance Underwriting Agency, Inc. of Ohio (Ohio) (iii) INAMAR Insurance Underwriting Agency of Texas (Texas) (g) INAPRO, Inc. (Delaware) (i) Reinsurance Solutions International, L.L.C. (Delaware) (50% with balance owned by non-affiliate) (h) Insurance Company of North America (Pennsylvania) (i) Atlantic Employers Insurance Company (New Jersey) (ii) CIGNA Employers Insurance Company (Pennsylvania) (iii) CIGNA Insurance Company of Ohio (Ohio) (iv) Indemnity Insurance Company of North America (Pennsylvania) (a) Allied Insurance Company (California) (b) CIGNA Indemnity Insurance Company (Pennsylvania) (c) CIGNA Insurance Company of Illinois (Illinois) (v) INA Surplus Insurance Company (Pennsylvania) (i) Marketdyne International, Inc. (Delaware) (j) Recovery Services International, Inc. (Delaware) III. CIGNA Investment Group, Inc. (Delaware) A. CIGNA International Finance Inc. (Delaware) (1) CIGNA International Investment Advisors, Ltd. (Delaware) (a) CIGNA International Investment Advisors Australia Limited (Australia) (b) CIGNA International Investment Advisors K.K. (Japan) B. CIGNA Investment Advisory Company, Inc. (Delaware) C. CIGNA Investments, Inc. (Delaware) (1) CIGNA Advisory Partners, Inc. (Delaware) (2) CIGNA Leveraged Capital Fund, Inc. (Delaware) MANAGEMENT AND CONTROL ---------------------- 4. Directors and executive officers. List the names and complete mailing -------------------------------- addresses of all directors and executive officers of the applicant and all persons chosen to become directors and executive officers. 7 Indicate all offices with the applicant held or to be held by each person named. The names and addresses of the directors and executive officers of the Company are set forth below. The title of each of the executive officers set forth below refers to such executive officer's position with the Company.
NAME ADDRESS OFFICE ---- ------- ------ Robert P. Bauman One Liberty Place Director Philadelphia, PA 19192 Robert H. Campbell One Liberty Place Director Philadelphia, PA 19192 Alfred C. DeCrane, Jr. One Liberty Place Director Philadelphia, PA 19192 Peter N. Larson One Liberty Place Director Philadelphia, PA 19192 Marilyn W. Lewis One Liberty Place Director Philadelphia, PA 19192 Charles R. Shoemate One Liberty Place Director Philadelphia, PA 19192 Louis W. Sullivan, M.D. One Liberty Place Director Philadelphia, PA 19192 Wilson H. Taylor One Liberty Place Chairman, Philadelphia, PA 19192 Chief Executive Officer and Director Harold A. Wagner One Liberty Place Director Philadelphia, PA 19192 Carol Cox Wait One Liberty Place Director Philadelphia, PA 19192 Paul Bergsteinsson Two Liberty Place Vice President and Philadelphia, PA 19192 Assistant Treasurer J. Raymond Caron Two Liberty Place Senior Vice President Philadelphia, PA 19192 John J. Corcoran Two Liberty Place Vice President Philadelphia, PA 19192
8 David B. Gerges One Liberty Place Senior Vice President Philadelphia, PA 19192 and Treasurer William L. Gerner 900 Cottage Grove Road Vice President Bloomfield, CT 06002 Arthur J. Harris, II 2001 Pennsylvania Avenue N.W. Vice President Washington, D.C. 20006 Donald M. Levinson One Liberty Place Executive Vice Philadelphia, PA 19192 President Nancy J. Meyer Two Liberty Place Vice President Philadelphia, PA 19192 Gerald T. Meyn Two Liberty Place Vice President Philadelphia, PA 19192 Michael J. Monroe One Liberty Place Vice President Philadelphia, PA 19192 James J. Ritchie Two Liberty Place Senior Vice President Philadelphia, PA 19192 Robert L. Robinson Two Liberty Place Senior Vice President Philadelphia, PA 19192 Paul H. Rohrkemper Two Liberty Place Senior Vice President Philadelphia, PA 19192 Mordecai Schwartz One Liberty Place Vice President Philadelphia, PA 19192 Judith E. Soltz Two Liberty Place Vice President Philadelphia, PA 19192 James G. Stewart One Liberty Place Executive Vice Philadelphia, PA 19192 President and Chief Financial Officer Gary A. Swords Two Liberty Place Vice President and Philadelphia, PA 19192 Chief Accounting Officer D. Timothy Tammany Two Liberty Place Vice President Philadelphia, PA 19192
9 Thomas J. Wagner One Liberty Place Executive Vice President Philadelphia, PA 19192 and General Counsel Barry F. Wiksten One Liberty Place Senior Vice President Philadelphia, PA 19192 Carol J. Ward One Liberty Place Corporate Secretary Philadelphia, PA 19192
5. Principal owners of voting securities. Furnish the following information as ------------------------------------- to each person owning 10 percent or more of the voting securities of the applicant. As of May 31, 1998, no person owned 10 percent or more of voting securities of the Company. UNDERWRITERS ------------ 6. Underwriters. Give the name and complete mailing address of (a) each person ------------ who, within three years prior to the date of filing the application, acted as an underwriter of any securities of the obligor which were outstanding on the date of filing the application, and (b) each proposed principal underwriter of the securities proposed to be offered. As to each person specified in (a), give the title of each class of securities underwritten. (a) The following were the underwriters in the Company's issuance in May 1997 of $300 million of 7.40% Notes due 2007 and $300 million 7.875% Debentures due 2027: Goldman, Sachs & Co. 85 Broad Street New York, New York 10004 Credit Suisse First Boston Corporation 11 Madison Avenue New York, New York 10055 Merrill Lynch, Pierce, Fenner & Smith Incorporated North Tower World Financial Center New York, New York 10282 (b) There are no underwriters of the securities proposed to be offered in the Exchange Offer. 10 CAPITAL SECURITIES ------------------ 7. Capitalization. (a) Furnish the following information as to each authorized -------------- class of securities of the applicant. (i) Equity Securities (as of May 31, 1998)
Title of Class Amount Authorized Amount Outstanding -------------- ----------------- ------------------ Common Stock $.25 par value 600,000,000 shares 215,377,643 Preferred Stock $ 1.00 par value 25,000,000 shares None
(ii) Debt Securities (as of May 31, 1998) (in millions)
Title of Class Amount Authorized Amount Outstanding --------------- ----------------- ------------------ 8.16% Notes due 2000 $ 25 $ 25 8 3/4% Notes due 2001 100 100 7.17% Notes due 2002 25 25 7.4% Notes due 2003 100 100 6 3/8% Notes due 2006 100 100 7.4% Notes due 2007 300 300 8 1/4% Notes due 2007 100 100 7.65% Notes due 2023 100 100 8.3% Notes due 2023 100 100 7 7/8% Debentures due 2027 300 300 Medium-term Notes 129 129 Commercial paper 1,200 241
(b) Give a brief outline of the voting rights of each class of voting securities referred to in paragraph (a) above. 11 Holders of the Company's Common Stock have one vote per share for the election of directors and all other matters, and have no cumulative voting rights. Of the 25 million shares of authorized Preferred Stock, six million shares have been designated as Junior Participating Preferred Stock, Series D ("Series D Stock"), issuable pursuant to the exercise of rights under the Company's shareholders rights plan. If the Series D Stock were issued, each 1/100 of a share would have voting rights approximately equal to one share of Common Stock. INDENTURE SECURITIES -------------------- 8. Analysis of indenture provisions. Insert at this point the analysis of -------------------------------- indenture provisions required under Section 305(a)(2) of the Trust Indenture Act of 1939, as amended. For purposes of this Section 8, the "Indenture" refers to the Indenture, dated as of January 1, 1994, by and between CIGNA Corporation and Marine Midland Bank (formerly Marine Midland Bank, N.A.), as Trustee (the "Trustee"). Other capitalized terms used in Section 8 are defined in the Indenture or the Offering Circular. A. EVENTS OF DEFAULT The following are Events of Default under the Indenture with respect to the New Notes: (1) default in the payment of interest on any New Note when due, continued for 30 days; (2) default in the payment of principal of (or premium, if any, on) any New Note when due; (3) default in the performance or breach of any other covenant or warranty of the Company in the Indenture (other than one included in the Indenture solely for the benefit of series of Debt Securities other than the New Notes), continued for 90 days after written notice as provided in the Indenture; (4) the acceleration, or failure to pay at maturity (including any applicable grace period), of any indebtedness for money borrowed by the Company exceeding $20,000,000 in principal amount, which acceleration or failure to pay is not rescinded or annulled or indebtedness paid within 15 days after the date on which written notice thereof shall have first been given to the Company as provided in the Indenture; and (5) certain events in bankruptcy, insolvency or reorganization in respect of the Company. If an Event of Default with respect to the New Notes occurs and is continuing, either the Trustee or the Holders of at least 25 percent in principal amount of the New Notes may declare the principal amount of all New Notes to be due and payable immediately. At any time after a declaration of acceleration with respect to the New Notes has been made, but before a judgment or decree based on acceleration has been obtained, the Holders of a majority in principal amount of the New Notes may, under certain circumstances, rescind and annul such acceleration. B. AUTHENTICATION AND DELIVERY The New Notes shall be executed on behalf of the Company by its Chairman of the Board, its Vice Chairman of the Board, its President or one of its Vice Presidents, under the Company's corporate seal reproduced thereon and attested by the Corporate Secretary or one of the Assistant Corporate Secretaries. Upon delivery of New Notes so executed to the Trustee for authentication together with a Company Order for the authentication and delivery of the New Notes, the Trustee shall authenticate and deliver the New Notes. The Indenture does not contain provisions regarding the application of the proceeds 12 from issuance of the New Notes. C. RELEASE OF PROPERTY SUBJECT TO LIEN The Company's obligations under the New Notes are not secured by any liens or security interests on any assets of the Company. Therefore, the Indenture does not contain any provisions with respect to the release or the release and substitution of any property subject to such a lien. D. SATISFACTION AND DISCHARGE The Indenture shall cease to be of further effect and shall be discharged as to the New Notes after certain actions are taken, when (1) either: (i) all of the New Notes have been delivered to the Trustee for cancellation, or (ii) all New Notes not delivered to the Trustee for cancellation have become due and payable or will become due and payable at their Stated Maturity within one year or are to be called for redemption within one year under arrangements satisfactory to the Trustee, and, in each case, the Company has deposited or caused to be deposited with the Trustee funds sufficient to pay and discharge the entire indebtedness of the New Notes; (2) the Company has paid all other sums required to be paid under the Indenture; and (3) the Company has delivered to the Trustee an Officer's Certificate and an Opinion of Counsel each stating that all conditions precedent relating to the satisfaction and discharge of the Indenture have been complied with. E. EVIDENCE OF COMPLIANCE WITH CONDITIONS AND COVENANTS The Company is required by the Indenture to deliver to the Trustee, within 120 days after the end of each of the Company's fiscal years, an Officer's Certificate stating whether or not, to the best knowledge of the signers thereof, the Company is in default in the performance and observance of certain terms of the Indenture, and, if there is such a default, specifying the nature and status of such default. 9. Other Obligors. Give the name and complete mailing address of any person, -------------- other than the applicant, who is an obligor upon the indenture securities. No person other than the Company is an obligor with respect to the New Notes. Contents of Application For Qualification. This application for ----------------------------------------- qualification comprises: (a) Pages numbered one to 14, consecutively; (b) The Statement of eligibility and qualification of the Trustee under the Indenture to be qualified (on Form T-1 incorporated herein by reference to Exhibit 99 attached hereto); (c) The following exhibits, in addition to those filed as a part of the statement of eligibility and qualification of the trustee: (i) Exhibit T3A -- The Company's Restated Certificate of Incorporation, ----------- as amended (incorporated by reference to Exhibit 3.1(a) and Exhibit 3.1(b) to the applicant's Form 10-Q for the quarter 13 ended March 31, 1998); (ii) Exhibit T3B -- The Company's Bylaws (incorporated herein by reference ----------- as Exhibit 3.2 to the registrant's Form 10-K for the year ended December 31, 1997); (iii) Exhibit T3C -- Form of Senior Indenture, dated as of January 1, 1994, ----------- between the Company and Marine Midland Bank, N.A., as Senior Trustee, (incorporated herein by reference to Exhibit 4.1 to the Company's Registration Statement No. 33-65396); (iv) Exhibit T3D -- Not applicable; ----------- (v) Exhibit T3E.1 -- Form of Offering Circular, dated as of June 24, ------------- 1998; (vi) Exhibit T3E.2 -- Form of Letter of Transmittal, dated as of June 24, ------------- 1998; (vii) Exhibit T3E.3 --Form of Notice of Guaranteed Delivery, dated as of ------------- June 24, 1998; (viii) Exhibit T3E.4 -- Form of Letter to Beneficial Owners, dated as of ------------- June 24, 1998; (ix) Exhibit T3E.5 -- Form of Letter to DTC Participants, dated as of June ------------- 24, 1998; (x) Exhibit T3E.6 -- Form of Letter to Clients, dated as of June 24, ------------- 1998; (xi) Exhibit T3F - - Cross-Reference Sheet; ----------- (xii) Exhibit 99 -- Form T-1 of Marine Midland Bank. ---------- 14 SIGNATURE --------- Pursuant to the requirements of the Trust Indenture Act of 1939, the Applicant, CIGNA Corporation, a corporation organized and existing under the laws of the State of Delaware, has duly caused this application to be signed on its behalf by the undersigned, thereunto duly authorized, and its seal to be hereunto affixed and attested, all in the City of Philadelphia and Commonwealth of Pennsylvania, on the 24th of June, 1998. CIGNA Corporation By: /s/ Mordecai Schwartz ------------------------ Mordecai Schwartz Vice President Attest: /s/ Robert A. Lukens --------------------------- Robert A. Lukens Assistant Corporate Secretary 15 EX-99.T3E.1 2 FORM OF OFFERING CIRCULAR DATED 06/24/98 EXHIBIT T3E.1 Offering Circular CIGNA CORPORATION LOGO Offer to Exchange Notes Due 2033 for Any and All of its Outstanding 8.30% Notes Due 2023 - -------------------------------------------------------------------------------- THE EXCHANGE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON THURSDAY, JULY 23, 1998, UNLESS EXTENDED (THE "EXPIRATION DATE"). - -------------------------------------------------------------------------------- CIGNA Corporation (the "Company"), a Delaware corporation, hereby offers, upon the terms and subject to the conditions set forth in this Offering Circular (the "Offering Circular") and the accompanying Letter of Transmittal (which together constitute the "Exchange Offer"), to exchange an aggregate principal amount of up to $100,000,000 of its Notes Due 2033 (the "New Notes") for a like principal amount of its issued and outstanding 8.30% Notes Due 2023 (the "Old Notes") from the registered holders (individually, a "Holder" and collectively, the "Holders") thereof. The terms of the New Notes are discussed in "Offering Circular Summary--Comparison of Old Notes and New Notes" and "Description of New Notes." The New Notes will evidence the same class of debt as the Old Notes and will be issued pursuant to, and entitled to the benefits of, an Indenture (the "New Indenture"), dated as of January 1, 1994, between the Company and Marine Midland Bank (formerly Marine Midland Bank, N.A.) (the "New Trustee"). The Old Notes were issued pursuant to, and are entitled to the benefits of, an Indenture (the "Old Indenture"), dated as of June 30, 1988, between the Company and Bankers Trust Company, as trustee. The Company will accept for exchange any and all Old Notes validly tendered and not withdrawn prior to the Expiration Date. Old Notes may be tendered only in denominations of $1,000 or an integral multiple thereof. See "The Exchange Offer--Procedures for Tendering Old Notes." The Exchange Offer is subject to certain customary conditions. See "The Exchange Offer--Conditions to the Exchange Offer." Holders that tender and do not withdraw their Old Notes will receive upon acceptance of the Old Notes by the Company a participation fee equal to 1.50% of the principal amount tendered (the "Participation Fee"). Holders that do not tender Old Notes are not eligible to receive the Participation Fee. The New Notes will constitute, and the Old Notes constitute, general unsecured obligations of the Company and the Old Notes rank, and the New Notes will rank, pari passu with all existing and future unsecured and unsubordinated senior indebtedness of the Company. (cover continued on next page) SEE "RISK FACTORS" FOR A DISCUSSION OF CERTAIN FACTORS THAT SHOULD BE CONSIDERED IN EVALUATING THE EXCHANGE OFFER. The date of this Offering Circular is June 24, 1998. THE OFFER OF THE SECURITIES CONTEMPLATED IN THE EXCHANGE OFFER IS MADE PURSUANT TO THE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF SECTION 5 OF THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), PROVIDED BY SECTION 3(A)(9) THEREOF AND, ACCORDINGLY, THE OFFER OF SUCH SECURITIES HAS NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION. THE SECURITIES OFFERED HEREBY HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS OFFERING CIRCULAR. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. THE COMMISSIONER OF INSURANCE OF THE STATE OF NORTH CAROLINA HAS NOT APPROVED OR DISAPPROVED THIS OFFERING NOR HAS THE COMMISSIONER PASSED UPON THE ACCURACY OR ADEQUACY OF THIS OFFER TO EXCHANGE. (Continued from cover page) The New Notes will have the same 8.30% interest coupon as the Old Notes until, but not including, January 15, 2023 and, thereafter, the New Notes will have an interest coupon calculated as provided herein. For the Old Notes, a price (the "Reference Price of the Old Notes") will be determined using a specified fixed spread pricing formula. Such Reference Price of the Old Notes will be based on a yield (the "Reference Yield of the Old Notes") to the maturity date of the Old Notes equal to (i) the yield (the "Benchmark Treasury Yield") on the 6.125% U.S. Treasury Note due November 15, 2027 (the "Benchmark Treasury Security") plus (ii) 130 basis points (the "2023 Fixed Spread"). For the New Notes, a per annum interest coupon (the "Extension Coupon") will be determined for the period from January 15, 2023 to the maturity date, January 15, 2033. This Extension Coupon (expressed as a percentage with two decimal places) will be the lesser of: (i) 8.30% per annum and (ii) a per annum interest rate at which the price of the New Notes (the "Reference Price of the New Notes") will be equal to the Reference Price of the Old Notes per $1,000 principal amount thereof. The Extension Coupon of the New Notes will be determined by using the Reference Price of the New Notes (equal to the Reference Price of the Old Notes if the Benchmark Treasury Yield is 5.88% or lower) and a yield (the "Reference Yield of the New Notes"), equal to (i) the Benchmark Treasury Yield plus (ii) 140 basis points (the "2033 Fixed Spread"). For each $1,000 principal amount of Old Notes exchanged, the Holder thereof will receive $1,000 principal amount of New Notes. The Extension Coupon and the reference prices will be determined as of 2:00 p.m., New York City time, on the second business day prior to the Expiration Date (the "Extension Coupon Determination Date"). Interest on the New Notes will accrue from the last interest payment date on the Old Notes (July 15, 1998) at the rate of 8.30%. The first interest payment date on the New Notes will be January 15, 1999. Accordingly, holders exchanging Old Notes for New Notes will not receive any interest payment in respect of Old Notes so exchanged. The Company, at its discretion, may elect to redeem the New Notes at any time, in whole or from time to time in part, until maturity, at an amount equal to the sum of (i) the principal amount of the New Notes being 2 redeemed plus accrued and unpaid interest thereon to the redemption date, and (ii) the Make-Whole Amount (as defined below), if any, with respect to such New Notes. See "Description of New Notes - Optional Redemption." The purpose of the Exchange Offer is to increase the Company's financial flexibility by adding the optional redemption provision to the New Notes and to take advantage of the current low interest rate environment by extending the maturity date of a portion of the Company's long-term debt. The New Notes will maintain the same interest rate as the Old Notes until, but not including, January 15, 2023 and, thereafter, the interest rate will be at the Extension Coupon as calculated herein until maturity, while deferring any additional refinancing costs. The Company believes that the terms of the New Notes will be more beneficial to it over the long-term. Based on an interpretation by the staff of the Division of Corporation Finance of the Securities and Exchange Commission (the "Commission"), the Company believes that the New Notes issued pursuant to the Exchange Offer may be offered for resale, resold and otherwise transferred by any Holder thereof without compliance with the registration requirements of the Securities Act. The Company has not entered into any arrangement or understanding with any person to distribute the New Notes to be received in the Exchange Offer and, to the best of the Company's information and belief, each person participating in the Exchange Offer is acquiring the New Notes in the ordinary course of business and has no arrangement or understanding with any person to participate in the distribution of the New Notes. The Company has made no arrangements for and has no understanding with any dealer, salesman or other person regarding the solicitation of tenders hereunder, and no person has been authorized by the Company to give any information or to make any representations in connection with the Exchange Offer other than those contained or incorporated by reference in this Offering Circular and, if given or made, such other information or representations must not be relied upon as having been authorized. Neither the delivery of this Offering Circular nor the exchange of New Notes for Old Notes shall, under any circumstances, create any implication that the information contained herein is correct as of any time subsequent to the date hereof. The Company will not receive any proceeds from the Exchange Offer. The Company has agreed to bear the expenses of the Exchange Offer. The Exchange Agent (as defined herein) and The Depository Trust Company ("DTC") have confirmed that the Exchange Offer is eligible for the DTC Automated Tender Offer Program ("ATOP"). Accordingly, DTC participants may electronically transmit their acceptance of the Exchange Offer by causing DTC to transfer Old Notes to the Exchange Agent in accordance with DTC's ATOP procedures for such a transfer. DTC will then send an Agent's Message (as defined herein) to the Exchange Agent. 3 --------------------------------------- NONE OF THE COMPANY, THE BOARD OF DIRECTORS OF THE COMPANY, EXECUTIVE OFFICERS OF THE COMPANY, THE FINANCIAL ADVISOR, THE INFORMATION AGENT OR THE EXCHANGE AGENT MAKES ANY RECOMMENDATION TO HOLDERS OF THE OLD NOTES AS TO WHETHER TO EXCHANGE OR REFRAIN FROM EXCHANGING THEIR OLD NOTES. IN ADDITION, NO ONE HAS BEEN AUTHORIZED TO MAKE ANY SUCH RECOMMENDATION. HOLDERS OF OLD NOTES MUST MAKE THEIR OWN DECISION WHETHER TO EXCHANGE OLD NOTES PURSUANT TO THE EXCHANGE OFFER AND, IF SO, THE AGGREGATE PRINCIPAL AMOUNT OF OLD NOTES TO EXCHANGE. THE EXCHANGE OFFER IS NOT BEING MADE TO, NOR WILL THE COMPANY ACCEPT TENDERS FOR EXCHANGE FROM, HOLDERS OF OLD NOTES IN ANY JURISDICTION IN WHICH THE EXCHANGE OFFER OR THE ACCEPTANCE THEREOF WOULD NOT BE IN COMPLIANCE WITH THE SECURITIES OR BLUE SKY LAWS OF SUCH JURISDICTION. 4 AVAILABLE INFORMATION The Company is subject to the informational reporting requirements of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and, in accordance therewith, files reports, proxy statements and other information with the Commission. Such reports, proxy statements and other information filed by the Company can be inspected and copied at the public reference facilities maintained by the Commission at Room 1024, Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549, and at its Regional Offices located at 7 World Trade Center, Suite 1300, New York, New York 10048 and Citicorp Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661-2511. Copies of such material can be obtained from the Public Reference Section of the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549 at prescribed rates. The Commission also maintains a site on the World Wide Web at http://www.sec.gov that contains reports, proxy and information statements and other information regarding registrants that file electronically with the Commission. Such reports, proxy statements and other information can also be inspected at the offices of the New York Stock Exchange, Inc., the Pacific Stock Exchange, Inc. and the Philadelphia Stock Exchange, Inc. The Company has instructed the Financial Advisor, the Exchange Agent and the Information Agent not to solicit exchanges in connection with the Exchange Offer or to make any recommendation with respect to acceptance or rejection of the Exchange Offer. Solicitations will be made solely by employees of the Company. The Financial Advisor, the Exchange Agent and the Information Agent will answer any questions from Holders of the Old Notes with respect to the Exchange Offer solely by reference to the terms of this Offering Circular, and Holders may contact the Financial Advisor, the Exchange Agent and the Information Agent at the addresses and telephone numbers listed below. Holders of the Old Notes who have any questions regarding the mechanics of the Exchange Offer should contact either the Exchange Agent or the Information Agent. In addition, all questions with respect to the Exchange Offer may be directed to the Company (Attn: Kim Bonner Massey, telephone number (215) 761-1131). FINANCIAL ADVISOR: INFORMATION AGENT: Donaldson, Lufkin & Jenrette MacKenzie Partners, Inc. Securities Corporation 156 Fifth Avenue, Penthouse 277 Park Avenue New York, New York 10010 New York, New York 10172 (800) 322-2885 (Toll Free) (800) 334-1604 (Toll Free) (212) 929-5500 (Call Collect) (212) 892-3351 (Call Collect) Attn: Paul S. Galant EXCHANGE AGENT: IBJ Schroder Bank & Trust Company By Mail: By Hand or Overnight Delivery: P.O. Box 84 One State Street Bowling Green Station By Facsimile: New York, New York 10004 New York, New York 10274-0084 (212) 858-2611 Attn: Securities Processing Attn: Reorganization Operations Window, Subcellar One (SC-1) Department Confirm by Telephone: (212) 858-2103 5 INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE The following documents have been filed by the Company with the Commission (Commission File No. 1-8323) pursuant to the Exchange Act and are incorporated herein by reference and made a part hereof (1) the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1997; (2) the Company's Quarterly Report on Form 10-Q for the quarter ended March 31, 1998; and (3) the Company's Current Reports on Form 8-K dated February 10 and April 30, 1998. In addition, the Company has filed a Form T-3, dated June 24, 1998, pursuant to the Trust Indenture Act of 1939, which Form T-3 includes a Form T-1 and the form of the New Indenture. All documents filed by the Company pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act subsequent to the date of this Offering Circular and prior to the Expiration Date are deemed to be incorporated by reference herein and shall be a part hereof from their respective filing dates. Information contained in this Offering Circular modifies or supersedes similar information contained in the documents incorporated by reference above. Further, information contained in any subsequently filed document, which is deemed to be incorporated by reference in this Offering Circular, will modify and supersede similar information contained in this Offering Circular or any of the documents incorporated by reference above. The Company will provide, without charge, to each person to whom a copy of this Offering Circular is delivered, upon written or oral request, a copy of any and all of the documents incorporated by reference in this Offering Circular, other than exhibits to such documents unless such exhibits are specifically incorporated by reference into the documents that this Offering Circular incorporates. Requests for copies of such documents, including the Form T-3, should be directed to CIGNA Corporation, Shareholder Services Department, Two Liberty Place, 1601 Chestnut Street, P.O. Box 7716, Philadelphia, PA 19192-2378, telephone number (215) 761-3517. 6 OFFERING CIRCULAR SUMMARY The following summary is qualified in its entirety by the more detailed information appearing elsewhere, or incorporated by reference, in this Offering Circular. See "Risk Factors" for a discussion of certain factors that should be considered in connection with the Exchange Offer and the New Notes offered hereby. THE COMPANY With shareholders' equity of $8.3 billion and assets of $111.2 billion as of March 31, 1998 and revenues of $20.0 billion for the year ended December 31, 1997, CIGNA Corporation and its subsidiaries constitute one of the largest investor-owned insurance organizations in the United States and one of the principal United States companies in the financial services industry. CIGNA Corporation is not an insurance company. Its subsidiaries are major providers of group life and health insurance, managed care products and services, retirement products and services, and property and casualty insurance. CIGNA is one of the largest international insurance organizations based in the United States, measured by international revenues, and one of the largest investor- owned health maintenance organizations in the United States, based on the number of members. CIGNA's major insurance subsidiaries, Connecticut General Life Insurance Company ("CG Life") and Insurance Company of North America ("INA"), are among the oldest insurance companies in the United States, with INA tracing its origins to 1792 and CG Life to 1865. CIGNA Corporation was incorporated in the State of Delaware in 1981. The principal executive offices of the Company are located at One Liberty Place, 1650 Market Street, P.O. Box 7716, Philadelphia, Pennsylvania 19192-1550. Its telephone number is (215) 761-1000. THE EXCHANGE OFFER The Exchange Offer: Pursuant to the Exchange Offer, the Company is offering to any Holder to exchange, for any and all of its Old Notes, an equal principal amount of newly issued New Notes. The New Notes will have the same 8.30% interest coupon as the Old Notes until, but not including, January 15, 2023, and thereafter, the interest coupon on the New Notes will be the Extension Coupon as calculated herein to January 15, 2033, the final maturity of the New Notes. For the Old Notes, a Reference Price of the Old Notes will be determined using a specified fixed spread pricing formula. Such Reference Price of the Old Notes will be based on the Reference Yield of the Old Notes to the maturity date of the Old Notes equal to (i) the Benchmark Treasury Yield plus (ii) the 2023 Fixed Spread. For the New Notes, an Extension Coupon will be determined for the period January 15, 2023 to the maturity date, January 15, 2033. The Extension Coupon (expressed as a percentage with two decimal places) will be the lesser of: (i) 8.30% per annum and (ii) a per annum interest rate at which the Reference Price of the New Notes will be equal to the Reference Price of the Old Notes per $1,000 principal amount of the Old Notes. The Extension Coupon of the New Notes will be determined by using the Reference Price of the New Notes (equal to the Reference Price of the Old Notes if the 7 Benchmark Treasury Yield is 5.88% or lower) and the Reference Yield of the New Notes. For each $1,000 principal amount of Old Notes exchanged in the Exchange Offer, an exchanging Holder will receive $1,000 principal amount of New Notes. The Extension Coupon and the reference prices will be determined based on the Benchmark Treasury Yield as of 2:00 p.m., New York City time, on the Extension Coupon Determination Date. Interest on the New Notes will accrue from the last interest payment date on the Old Notes (July 15, 1998) at the rate of 8.30%. The first interest payment date on the New Notes will be January 15, 1999. Accordingly, holders exchanging Old Notes for New Notes will not receive any interest payment in respect of Old Notes so exchanged. The New Notes will be unsecured obligations of the Company and will rank pari passu with all existing and future unsecured and unsubordinated indebtedness of the Company. The terms and conditions of the New Notes will be similar to those that currently apply to the Old Notes. Changes from the Old Notes and the Old Indenture, including an optional redemption provision not found in the Old Notes, are set forth below in the section "Comparison of Old Notes and New Notes". See also "Description of New Notes". Calculations: The reference prices, reference yields, the Benchmark Treasury Yield and the Extension Coupon will be determined as set forth in the section "The Exchange Offer--Calculations; Information" and in Schedules A, B, C and D attached hereto. Participation Fee: Holders that tender and do not withdraw their Old Notes and whose Old Notes are accepted for exchange by the Company will receive a participation fee equal to 1.50% of the principal amount of Old Notes tendered. Holders that do not tender Old Notes are not eligible to receive a Participation Fee. Information: As soon as practicable on the Extension Coupon Determination Date, but in any event before 9:00 a.m., New York City time, on the following business day, the Company will publicly announce by press release to the Dow Jones News Service: the Benchmark Treasury Yield, the Reference Yield of the Old Notes, the Reference Price of the Old Notes, the Reference Yield of the New Notes, the Extension Coupon and the Reference Price of the New Notes. 8 During the term of the Exchange Offer, Holders of the Old Notes can obtain information regarding the Benchmark Treasury Yield, reference yields, reference prices and other information regarding the terms of the Exchange Offer from the Financial Advisor at (800) 334-1604 (toll-free) or (212) 892- 3351 (call collect), attention Paul S. Galant. In addition, the Company intends to publish information about the Exchange Offer, including the information described in the preceding paragraph when available, on MCM "Corporate Watch" Service on Telerate page 64150. Old Notes Outstanding: As of the date hereof, $100,000,000 aggregate principal amount of Old Notes are outstanding. CUSIP Number: The CUSIP Number of the Old Notes is 125509AG4. Conditions to the Exchange Offer: Consummation of the Exchange Offer is conditioned upon certain customary conditions described herein. The Company may, in its sole discretion, waive any condition with respect to the Exchange Offer and accept for exchange any Old Notes tendered. See "The Exchange Offer--Conditions to the Exchange Offer". Expiration and Extensions: The Exchange Offer will expire at 5:00 p.m., New York City time, on Thursday, July 23, 1998, or at such later time and date to which the Exchange Offer may be extended by the Company in accordance with the procedures described herein. See "The Exchange Offer--Expiration Date; Extensions; Termination; Amendments". If the Exchange Offer is extended for a period longer than three business days from the previously scheduled Expiration Date, then a new Extension Coupon Determination Date, which would be two business days prior to the new Expiration Date, may be established. If the extension is for three business days or less, no new Extension Coupon Determination Date will be established and the Extension Coupon will remain as determined on the Extension Coupon Determination Date prior to the extension of the Exchange Offer. If the consideration offered with respect to the Exchange Offer is changed or if any other amendment to the terms of the Exchange Offer is made that, in the opinion of the Company, would be adverse to the interests of the holders tendering Old Notes for exchange, the Exchange Offer will remain open for at least five business days from the date public notice of such change or amendment is given. 9 Certain U.S. Federal Income Tax In the opinion of Milbank, Tweed, Consequences: Hadley & McCloy, special tax counsel to the Company, the exchange of Old Notes pursuant to the Exchange Offer will constitute a recapitalization for U.S. federal income tax purposes and a Holder of Old Notes that tenders pursuant to the Exchange Offer generally will recognize no gain or loss upon the exchange of Old Notes for New Notes. See "Certain U.S. Federal Income Tax Consequences". Certain Consequences of the In deciding whether to participate in Exchange Offer: the Exchange Offer, each Holder should consider carefully, in addition to the other information contained in this Offering Circular- the information set forth under the captions "Description of New Notes" and "Risk Factors". Tender of Old Notes: Old Notes may be tendered for exchange only in denominations of $1,000 or an integral multiple thereof. To tender Old Notes, Holders must deliver their Old Notes together with a properly completed and duly executed Letter of Transmittal to the Exchange Agent or follow the procedures for book-entry transfer. If Old Notes are held by a broker, dealer, commercial bank, trust company or other nominee (individually, a "Custodian" and collectively, the "Custodians"), the beneficial owner thereof must instruct such Custodian to tender such Old Notes on their behalf. All tenders must be made on or prior to the Expiration Date. See "The Exchange Offer--Procedures for Tendering Old Notes". New Notes will be delivered only in book-entry form through DTC. Accordingly, Holders who anticipate tendering and whose Old Notes are not held through DTC are urged to contact promptly a Custodian that has the capability to hold securities through DTC, to arrange for receipt of any New Notes to be delivered pursuant to the Exchange Offer and to obtain the information necessary to provide the required DTC participant and account information in the relevant Letter of Transmittal. See "The Exchange Offer Proper Execution and Delivery of Letter of Transmittal". Guaranteed Delivery: Holders of Old Notes who wish to tender their Old Notes and who cannot deliver their Old Notes or the Letter of Transmittal to the Exchange Agent, prior to the Expiration Date, or cannot complete procedures for book-entry transfer on a timely basis, must tender their Old Notes according to the guaranteed delivery procedures set forth in "The Exchange Offer--Guaranteed Delivery Procedures". 10 Acceptance of Old Notes and Subject to satisfaction or waiver of Delivery of New Notes: the conditions to the Exchange Offer, the Company will exchange any and all Old Notes that are properly tendered and not withdrawn prior to the Expiration Date. New Notes will be delivered only in book-entry form through DTC. New Notes will be delivered, along with payment of the Participation Fee, on the fifth business day following the Expiration Date (the "Exchange Date"). See "The Exchange Offer--Acceptance of Old Notes Tendered for Exchange; Delivery of New Notes". Withdrawal Rights: Tenders of Old Notes may be withdrawn at any time prior to the Expiration Date. Withdrawal of tendered Old Notes will be deemed a rejection of the Exchange Offer. See "The Exchange Offer--Withdrawal Rights". Absence of Dissenters' Rights: Holders of Old Notes do not have any appraisal or dissenters' rights under the Delaware General Corporation Law or the Old Indenture. See "The Exchange Offer--Absence of Dissenters' Rights". Financial Advisor: Donaldson, Lufkin & Jenrette Securities Corporation 277 Park Avenue New York, New York 10172 (800) 334-1604 (toll-free) (212) 892-3351 (call collect) Attention: Paul S. Galant Exchange Agent: IBJ Schroder Bank & Trust Company Bowling Green Station P.O. Box 84 New York, New York 10274-0084 (212) 858-2103 Attention: Reorganization Operations Department Information Agent: MacKenzie Partners, Inc. 156 Fifth Avenue New York, New York 10010 (800) 322-2885 (toll-free) (212) 929-5500 (call collect) THE NEW NOTES Issuer: CIGNA Corporation. Indenture: The New Notes will be issued under the New Indenture. 11 Maturity: January 15, 2033. The New Notes are subject to redemption at the option of the Company as discussed herein. Interest: Interest will be paid each January 15 and July 15, commencing January 15, 1999. Interest will be calculated on the basis of a 360-day year consisting of twelve 30-day months. The January 15, 1999 interest payment will include interest accruing on the New Notes from July 15, 1998 until, but not including, January 15, 1999. Holders of record of the Old Notes as of July 1, 1998 will be entitled to interest on the Old Notes until, but not including, July 15, 1998. Rating: As of the date hereof, the Company's senior debt securities, including the Old Notes, are rated A3 by Moody's Investors Service, Inc. ("Moody's"), A by Standard & Poor's Ratings Group, a division of The McGraw-Hill Companies ("S&P") and A by Duff & Phelps Credit Rating Co. ("DCR"). The Company expects that the New Notes will receive ratings equivalent to those assigned from time to time to the Old Notes. A security rating is not a recommendation to buy, sell or hold securities and may be subject to revision or withdrawal at any time by the assigning rating agency. Ranking: The New Notes will be unsecured obligations of the Company and will rank pari passu with all existing and future unsecured and unsubordinated indebtedness of the Company. Form: The New Notes will be available only in book-entry form through DTC. See "Description of the New Notes-Book-Entry Procedures". Optional Redemption: CIGNA Corporation, at its option, may redeem the New Notes at any time, in whole or from time to time in part, until maturity, upon not less than 30 nor more than 60 days' notice, at a redemption price equal to the sum of (i) the principal amount of the New Notes being redeemed plus accrued and unpaid interest thereon to the redemption date, and (ii) the Make-Whole Amount (as defined below), if any, with respect to such New Notes. See "Description of New Notes". Use of Proceeds: The New Notes will be issued only in exchange for the Old Notes. The Company will not receive any cash proceeds from the issuance of the New Notes. Listing: None. 12 COMPARISON OF OLD NOTES AND NEW NOTES The following is a brief comparison of the principal features of the Old Notes and the New Notes. The following descriptions are brief summaries, do not purport to be complete and are qualified in their entirety by reference, with respect to the Old Notes, to the Old Notes and the Old Indenture and, with respect to the New Notes, to the New Notes and the New Indenture. For further information regarding the New Notes and for definitions of capitalized terms used with respect to the New Notes but not otherwise defined herein, see "Description of New Notes."
OLD NOTES NEW NOTES ------------------ ------------------------ Obligor: CIGNA Corporation CIGNA Corporation Trustee: Bankers Trust Company Marine Midland Bank Aggregate Principal $100,000,000 Up to $100,000,000 Amount: Maturity: January 15, 2023 January 15, 2033 Interest Rate: 8.30% per annum 8.30% per annum until, but not including, January 15, 2023, and thereafter, at the Extension Coupon as calculated herein to January 15, 2033. Interest Payment Dates: January 15 and July 15 annually January 15 and July 15 annually Rating: As of the date hereof, the Old Notes As of the date hereof, the Company's are rated A3 by Moody's, A by S&P and senior debt securities are rated A3 by A by DCR. Moody's, A by S&P and A by DCR. The Company expects that the New Notes will receive ratings equivalent to those assigned from time to time to the Old Notes. Ranking: The Old Notes are unsecured obligations The New Notes will be unsecured of the Company, and rank pari passu obligations of the Company and will with all existing and future unsecured rank pari passu with all existing and and unsubordinated indebtedness of the future unsecured and unsubordinated Company. indebtedness of the Company.
13
OLD NOTES NEW NOTES ------------------ ------------------------ Optional Redemption: None The Company may, at its option, redeem the New Notes at any time, in whole or from time to time in part, until maturity, upon not less than 30 nor more than 60 days' notice, at a redemption price equal to the sum of (i) the principal amount of the New Notes being redeemed plus accrued and unpaid interest thereon to the redemption date, and (ii) the Make- Whole Amount (as defined), if any, with respect to such New Notes. Sinking Fund: None None Security: None None Change of Control: None None
14 RISK FACTORS In deciding whether to participate in the Exchange Offer, each Holder should consider carefully, in addition to the other information contained in the Offering Circular, the factors listed below. CERTAIN CONSIDERATIONS FOR TENDERING AND NON-TENDERING HOLDERS To the extent that Old Notes are tendered and purchased in the Exchange Offer and the number of Old Notes is decreased, the trading market for the Old Notes could become more limited. A debt security with a smaller outstanding principal amount available for trading (a "smaller float") may command a lower price than would a comparable debt security with a larger float. Therefore, the market price for the Old Notes not tendered or not purchased may be adversely affected to the extent that the principal amount of Old Notes tendered reduces the float. Depending upon, among other things, the amount of Old Notes outstanding after the Exchange Offer, the trading market for the Old Notes may be more limited which may, therefore, adversely affect the liquidity and market price of the Old Notes. Similarly, depending upon, among other things, the amount of New Notes outstanding after the Exchange Offer, the trading market for the New Notes may be limited, which may, therefore, adversely affect the liquidity and market price of the New Notes. The trading market for the Old Notes not tendered and purchased pursuant to the Exchange Offer and the New Notes issued by the Company pursuant to the Exchange Offer will, in each case, depend upon, among other things, the principal amount outstanding after the consummation of the Exchange Offer, the number of Holders and the interest in maintaining a market in the securities on the part of securities firms. TERMS OF THE NEW NOTES The New Notes will be issued under the New Indenture. The New Indenture contains covenants and other terms similar to those that currently apply to the Old Notes. However, the New Notes, unlike the Old Notes, may be redeemed at any time, in whole or from time to time in part, prior to maturity, at the option of the Company subject to a "Make-Whole" provision. See "Offering Circular Summary--Comparison of Old Notes and New Notes" and "Description of New Notes". 15 BUSINESS OF THE COMPANY With shareholders' equity of $8.3 billion and assets of $111.2 billion as of March 31, 1998 and revenues of $20.0 billion for the year ended December 31, 1997, CIGNA Corporation and its subsidiaries constitute one of the largest investor-owned insurance organizations in the United States and one of the principal United States companies in the financial services industry. CIGNA Corporation is not an insurance company. Its subsidiaries are major providers of group life and health insurance, managed care products and services, retirement products and services, and property and casualty insurance. CIGNA is one of the largest international insurance organizations based in the United States, measured by international revenues, and one of the largest investor- owned health maintenance organizations in the United States, based on the number of members. CIGNA's major insurance subsidiaries, Connecticut General Life Insurance Company ("CG Life") and Insurance Company of North America ("INA"), are among the oldest insurance companies in the United States, with INA tracing its origins to 1792 and CG Life to 1865. CIGNA Corporation was incorporated in the State of Delaware in 1981. CIGNA's revenues are derived principally from premiums and fees and investment income. CIGNA conducts its business through the following operating divisions, the financial results of which are reported in the following segments: Employee Life and Health Benefits Segment CIGNA HealthCare CIGNA Group Insurance: Life, Accident, Disability Employee Retirement and Savings Benefits Segment CIGNA Retirement & Investment Services Individual Financial Services Segment CIGNA Reinsurance Property and Casualty Segment CIGNA Property & Casualty CIGNA International Investment results produced by CIGNA Investment Management on behalf of CIGNA's insurance operations are reported in each segment's results or in Other Operations. Principally through an indemnity reinsurance transaction, CIGNA sold the individual life insurance and annuity business of its Individual Financial Services Segment to Lincoln National Corporation effective January 1, 1998. As of March 31, 1998, the Individual Financial Services Segment includes the results of CIGNA's corporate-owned life insurance, and life, accident and health reinsurance businesses as well as the recognition of the deferred gain from the sale of the individual life insurance and annuity business. 16 SELECTED FINANCIAL DATA The following table sets forth certain selected historical financial information of the Company for, and as of the end of, each of the periods presented. The selected historical financial information should be read in conjunction with the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1997 and its Quarterly Report on Form 10-Q for the quarter ended March 31, 1998. The selected historical financial information provided below is not necessarily indicative of future results of operations or financial performance for the Company. All share and per share amounts have been adjusted for the Company's three-for-one stock split effective May 4, 1998.
Three Months Ended March 31, Year Ended December 31, ------------------------- -------------------------------------------------------- 1998 1997 1997 1996 1995 1994 1993 ---------- ---------- ---------- ---------- --------- --------- --------- (Dollars in millions, except per share (unaudited) amounts) INCOME STATEMENT DATA - --------------------- REVENUES Premiums and fees $ 3,901 $ 3,388 $ 14,935 $ 13,916 $ 13,914 $ 13,912 $ 13,712 Net investment income and other revenues 1,451 1,213 4,936 4,943 4,808 4,438 4,408 Realized investment gains 59 44 167 91 233 42 282 - ----------------------------------------- ---------- ---------- ---------- ---------- --------- --------- --------- Total $ 5,411 $ 4,645 $ 20,038 $ 18,950 $ 18,955 $ 18,392 $ 18,402 ========================================= ========== ========== ========== ========== ========= ========= ========= NET INCOME (LOSS) Employee Life and Health Benefits $ 149 $ 121 $ 441 $ 500 $ 597 $ 548 $ 589 Employee Retirement and Savings Benefits 59 62 233 222 194 190 159 Individual Financial Services 248 55 208 168 151 136 110 Property and Casualty 62 65 275 240 (673) (235) (530) Other Operations (23) (15) (71) (74) (58) (85) (94) - ----------------------------------------- ---------- ---------- ---------- ---------- --------- --------- --------- Total $ 495 $ 288 $ 1,086 $ 1,056 $ 211 $ 554 $ 234 ========================================= ========== ========== ========== ========== ========= ========= ========= Net income per share - basic $ 2.30 $ 1.31 $ 4.93 $ 4.68 $ 0.97 $ 2.58 $ 1.09 ========================================= ========== ========== ========== ========== ========= ========= ========= Net income per share - diluted $ 2.27 $ 1.30 $ 4.88 $ 4.64 $ 0.96 $ 2.50 $ 1.09 ========================================= ========== ========== ========== ========== ========= ========= ========= BALANCE SHEET DATA - ------------------ Total assets $111,219 $ 98,752 $108,199 $ 98,932 $ 95,903 $ 86,102 $ 84,975 Long-term debt $ 1,463 $ 910 $ 1,465 $ 1,021 $ 1,066 $ 1,389 $ 1,235 Shareholders' equity $ 8,325 $ 7,117 $ 7,932 $ 7,208 $ 7,157 $ 5,811 $ 6,575 Per share $ 38.58 $ 32.06 $ 36.55 $ 32.38 $ 31.25 $ 26.82 $ 30.43 Common shares outstanding (thousands) 215,808 221,982 216,996 222,594 228,996 216,675 216,045 Common dividends declared per share $ 0.29 $ 0.28 $ 1.11 $ 1.07 $ 1.01 $ 1.01 $ 1.01 17
CAPITALIZATION The following table sets forth the consolidated capitalization of the Company as of March 31, 1998. This table should be read in conjunction with the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1997 and its Quarterly Report on Form 10-Q for the quarter ended March 31, 1998. Since March 31, 1998, there has been no material change in the consolidated capitalization of the Company as adjusted for the Company's three-for-one stock split effective May 4, 1998.
AS OF MARCH 31, 1998 (unaudited) (in millions) Short-term debt $ 266 ======= Long-term debt $ 1,463 ======= Shareholders' equity: Common stock $ 66 Additional paid-in capital 2,695 Net unrealized appreciation - fixed maturities $ 723 Net unrealized appreciation - equity securities 214 Net translation of foreign currencies (125) ------- Accumulated other comprehensive income 812 Retained earnings 6,129 Treasury stock, at cost (1,377) ------- Total shareholders' equity $ 8,325 ======= Total short-term debt and capitalization $10,054 =======
18 THE EXCHANGE OFFER PURPOSE OF THE EXCHANGE OFFER The purpose of the Exchange Offer is to increase the Company's financial flexibility by adding the optional redemption provision into the New Notes and to take advantage of the current low interest rate environment by extending the maturity date of a portion of the Company's long-term debt. The New Notes will maintain the same interest rate as the Old Notes until, but not including, January 15, 2023, and, thereafter, will be at the Extension Coupon as calculated herein until maturity, while deferring any additional refinancing costs. The Company believes that the terms of the New Notes will be more beneficial to it over the long-term. TERMS OF THE EXCHANGE OFFER Upon the terms and subject to the conditions set forth in this Offering Circular and the accompanying Letter of Transmittal, the Company is making the Exchange Offer, pursuant to which it is offering to exchange $1,000 principal amount of the Company's New Notes for each $1,000 principal amount of the Company's Old Notes. The New Notes will have the same 8.30% interest coupon as the Old Notes until, but not including, January 15, 2023, and thereafter, the interest coupon will be calculated as provided herein to January 15, 2033, the final maturity of the New Notes. For the Old Notes, a Reference Price of the Old Notes will be determined using a specified fixed spread pricing formula. Such Reference Price of the Old Notes will be based on a Reference Yield of the Old Notes to the maturity date of the Old Notes equal to (i) the Benchmark Treasury Yield plus (ii) the 2023 Fixed Spread. For the New Notes, an Extension Coupon will be determined for the period January 15, 2023 to the maturity date, January 15, 2033. The Extension Coupon (expressed as a percentage within two decimal places) will be the lesser of: (i) 8.30% per annum and (ii) a per annum interest rate at which the price of the New Notes will be equal to the Reference Price of the Old Notes per $1,000 principal amount of the Old Notes. The Extension Coupon of the New Notes will be determined by using the Reference Price of the New Notes (equal to the Reference Price of the Old Notes if the Benchmark Treasury Yield is 5.88% or lower) and the Reference Yield of the New Notes. For each $1,000 principal amount of Old Notes exchanged in the Exchange Offer, an exchanging Holder will receive $1,000 principal amount of New Notes. The Extension Coupon and Reference Prices will be determined based on the Benchmark Treasury Yield as of 2:00 p.m., New York City time, on the Extension Coupon Determination Date. SUMMARY OF TERMS The following is a summary of certain defined terms used in describing the Exchange Offer. Benchmark Treasury Security: means the 6.125% U.S. Treasury Note due November 15, 2027. Benchmark Treasury Yield: means, on the Extension Coupon Determination Date, the yield on the Benchmark Treasury Security (expressed as a percentage with two decimal points). Exchange Date: means the date five business days following the Expiration Date on which New Notes will be delivered pursuant to the Exchange Offer, along with payment of the Participation Fee. The Exchange Date is Thursday, July 30, 1998, unless the Expiration Date is extended. Expiration Date: means 5:00 p.m. New York City time, on Thursday, July 23, 1998, unless the Exchange Offer is extended. 19 Extension Coupon: means, for the New Notes, the per annum interest rate (expressed as a percentage with two decimal places) paid on such New Notes from and including, January 15, 2023, to the maturity date, January 15, 2033, as described in Schedule C. The Extension Coupon will be the lesser of: (i) 8.30% ---------- per annum and (ii) a per annum interest rate set such that for any Benchmark Treasury Yield, on the Extension Coupon Determination Date, the reference prices for the New Notes will equal the Reference Prices for the Old Notes per $1,000 principal amount of the Old Notes. Extension Coupon Determination Date: means 2:00 p.m., New York City time, on the second business day prior to the Expiration Date. Participation Fee: an amount equal to 1.50% of the principal amount exchanged payable upon acceptance of the Old Notes for exchange by the Company to a Holder that tenders and does not withdraw its Old Notes. Reference Price of the New Notes: means the applicable price per $1,000 principal amount of the New Notes (which will be equal to the Reference Price of the Old Notes if the Benchmark Treasury Yield is 5.88% or lower). Reference Price of the Old Notes: means the price per $1,000 principal amount of the Old Notes, determined in accordance with standard market practice as described in Schedule A. Such price will be based on the Reference Yield of the Old Notes to the maturity date of January 15, 2023. Reference Yield of the New Notes: means, at the Extension Coupon Determination Date, the sum of the Benchmark Treasury Yield and the 2033 Fixed Spread. Reference Yield of the Old Notes: means, on the Extension Coupon Determination Date, the sum of the Benchmark Treasury Yield and the 2023 Fixed Spread. 2023 Fixed Spread: means 1.30% (130 basis points). 2033 Fixed Spread: means 1.40% (140 basis points). Illustrative Example and Formulas. The following is a table that applies (i) the formulas to be used to determine the reference prices for the Old Notes and New Notes and (ii) the applicable fixed spread pursuant to which a reference price for the Old and New Notes will be determined for any given Benchmark Treasury Yield and Extension Coupon assuming an Exchange Date of July 30, 1998 (which will be the Exchange Date unless the Exchange Offer is extended). Set forth in Schedule A is the methodology used to determine the Reference Prices of ---------- the Old Notes in the following table. Set forth in Schedule C is the ---------- methodology used to determine the Extension Coupons in the following table. Schedule B provides an illustrative example of the calculation of Reference - ---------- Prices of the Old Notes. Schedule D provides illustrative examples of the ---------- calculation of the Extension Coupons. The following table sets forth the (i) Reference Yield of the Old Notes, (ii) Reference Price of the Old Notes, (iii) Reference Yield of the New Notes, (iv) Extension Coupon and (v) Reference Price of the New Notes, if the Benchmark Treasury Yield on the Extension Coupon Determination Date is between 5.40% and 5.93%. 20
Benchmark Reference Yield Reference Price Reference Yield Reference Price Treasury Yield of the Old Notes Of the Old Notes of the New Notes Extension Coupon of the New Notes - -------------- ----------------- ---------------- ----------------- ----------------- ---------------- 5.40% 6.70% $1,191.11 6.80% 7.77% $1,191.11 5.41% 6.71% $1,189.74 6.81% 7.78% $1,189.74 5.42% 6.72% $1,188.38 6.82% 7.79% $1,188.38 5.43% 6.73% $1,187.02 6.83% 7.80% $1,187.02 5.44% 6.74% $1,185.66 6.84% 7.81% $1,185.66 5.45% 6.75% $1,184.30 6.85% 7.83% $1,184.30 5.46% 6.76% $1,182.95 6.86% 7.84% $1,182.95 5.47% 6.77% $1,181.60 6.87% 7.85% $1,181.60 5.48% 6.78% $1,180.25 6.88% 7.86% $1,180.25 5.49% 6.79% $1,178.90 6.89% 7.87% $1,178.90 5.50% 6.80% $1,177.55 6.90% 7.88% $1,177.55 5.51% 6.81% $1,176.21 6.91% 7.89% $1,176.21 5.52% 6.82% $1,174.87 6.92% 7.90% $1,174.87 5.53% 6.83% $1,173.53 6.93% 7.91% $1,173.53 5.54% 6.84% $1,172.20 6.94% 7.93% $1,172.20 5.55% 6.85% $1,170.86 6.95% 7.94% $1,170.86 5.56% 6.86% $1,169.53 6.96% 7.95% $1,169.53 5.57% 6.87% $1,168.21 6.97% 7.96% $1,168.21 5.58% 6.88% $1,166.88 6.98% 7.97% $1,166.88 5.59% 6.89% $1,165.56 6.99% 7.98% $1,165.56 5.60% 6.90% $1,164.23 7.00% 7.99% $1,164.23 5.61% 6.91% $1,162.91 7.01% 8.00% $1,162.91 5.62% 6.92% $1,161.60 7.02% 8.01% $1,161.60 5.63% 6.93% $1,160.28 7.03% 8.02% $1,160.28 5.64% 6.94% $1,158.97 7.04% 8.04% $1,158.97 5.65% 6.95% $1,157.66 7.05% 8.05% $1,157.66 5.66% 6.96% $1,156.35 7.06% 8.06% $1,156.35 5.67% 6.97% $1,155.05 7.07% 8.07% $1,155.05 5.68% 6.98% $1,153.74 7.08% 8.08% $1,153.74 5.69% 6.99% $1,152.44 7.09% 8.09% $1,152.44 5.70% 7.00% $1,151.14 7.10% 8.10% $1,151.14 5.71% 7.01% $1,149.85 7.11% 8.11% $1,149.85 5.72% 7.02% $1,148.55 7.12% 8.12% $1,148.55 5.73% 7.03% $1,147.26 7.13% 8.14% $1,147.26 5.74% 7.04% $1,145.97 7.14% 8.15% $1,145.97 5.75% 7.05% $1,144.68 7.15% 8.16% $1,144.68 5.76% 7.06% $1,143.40 7.16% 8.17% $1,143.40 5.77% 7.07% $1,142.12 7.17% 8.18% $1,142.12 5.78% 7.08% $1,140.84 7.18% 8.19% $1,140.84 5.79% 7.09% $1,139.56 7.19% 8.20% $1,139.56 5.80% 7.10% $1,138.28 7.20% 8.21% $1,138.28 5.81% 7.11% $1,137.01 7.21% 8.22% $1,137.01 5.82% 7.12% $1,135.73 7.22% 8.24% $1,135.73 5.83% 7.13% $1,134.46 7.23% 8.25% $1,134.46 5.84% 7.14% $1,133.20 7.24% 8.26% $1,133.20 5.85% 7.15% $1,131.93 7.25% 8.27% $1,131.93 5.86% 7.16% $1,130.67 7.26% 8.28% $1,130.67 5.87% 7.17% $1,129.41 7.27% 8.29% $1,129.41 5.88% 7.18% $1,128.15 7.28% 8.30% $1,128.15 5.89% N/A N/A N/A 8.30% N/A 5.90% N/A N/A N/A 8.30% N/A 5.91% N/A N/A N/A 8.30% N/A 5.92% N/A N/A N/A 8.30% N/A 5.93% N/A N/A N/A 8.30% N/A
21 CALCULATIONS; INFORMATION The Reference Price of the Old Notes will be determined in the manner described in Schedule A by calculating, per $1,000 principal amount of such Old Notes, the ---------- present value, using the Reference Yield of the Old Notes, of (i) the principal amount payable on the maturity date of the Old Notes plus (ii) all remaining payments of interest up to and including the maturity date of the Old Notes. The Reference Price of the Old Notes will be rounded to the nearest cent per $1,000 principal amount of the Old Notes. The methodology to be used in calculating the Reference Price of the Old Notes is set forth in Schedule A ---------- hereto. An example of the application of such methodology is provided for the Old Notes in Schedule B hereto. The Reference Yield of the Old Notes will be ---------- determined by calculating the sum of (a) the Benchmark Treasury Yield and (b) the 2023 Fixed Spread. The reference price calculation will be made using the Benchmark Treasury Yield as of the Extension Coupon Determination Date. For the New Notes, a per annum interest rate, i.e., the Extension Coupon, will be determined for the period from January 15, 2023 to the maturity date of the New Notes, January 15, 2033. The Extension Coupon, expressed as a percentage with two decimal places, will be the lesser of: (i) 8.30% per annum and (ii) a per annum interest rate at which the Reference Price of the New Notes will be equal to the Reference Price of the Old Notes per $1,000 principal amount of the Old Notes. The Extension Coupon of the New Notes will be determined in the manner described in Schedule C hereto by using the Reference Price of the New ---------- Notes (equal to the Reference Price of the Old Notes if the Benchmark Treasury Yield is 5.88% or lower) and the Reference Yield of the New Notes. The methodology to be used in calculating the Extension Coupon of the New Notes is set forth in Schedule C hereto. An example of the application of such ---------- methodology is provided for the New Notes in Schedule D hereto. The Reference ---------- Yield of the New Notes will be determined by calculating the sum of the Benchmark Treasury Yield and the 2033 Fixed Spread. The reference price calculation will be made using the Benchmark Treasury Yield as of the Extension Coupon Determination Date. The Benchmark Treasury Yield will be calculated by the Financial Advisor in accordance with standard market practice based on the bid side price for such Benchmark Treasury Security as of the Extension Coupon Determination Date, as such bid side price is displayed on the Cantor Fitzgerald Quotation Service for U.S. Government Securities (the "Cantor Fitzgerald Quotation Service") on Telerate page 500. If any relevant price is not available on a timely basis on the Cantor Fitzgerald Quotation Service or is manifestly erroneous, the relevant price information may be obtained from such other quotation service as the Company and the Financial Advisor shall select in their reasonable discretion, the identity of which shall be disclosed by the Company and the Financial Advisor to exchanging Holders. Although the Benchmark Treasury Yield will be determined based solely on the sources described above, information regarding the price of the Benchmark Treasury Security also may be found in The Wall Street Journal. After the Extension Coupon Determination Date, the Extension Coupon that will be received by a holder pursuant to the Exchange Offer will be known and holders will be able to ascertain the Reference Price of the Old Notes and the Reference Price of the New Notes in the manner described above, unless the Exchange Offer is extended for a period longer than three business days. In the event the Exchange Offer is extended for a period longer than three business days from the previously scheduled Expiration Date, then a new Extension Coupon Determination Date, which would be two business days prior to the new Expiration Date, may be established. If the extension is for three business days or less, no new Extension Coupon Determination Date may be established and the Extension Coupon will remain as determined on the Extension Coupon Determination Date prior to the extension of the Exchange Offer. 22 As soon as practicable after the Extension Coupon Determination Date, but in any event before 9:00 a.m., New York City time, on the following business day, the Company will publicly announce by press release to the Dow Jones News Service: the Benchmark Treasury Yield, the Reference Yield of the Old Notes, the Reference Price of the Old Notes, the Reference Yield of the New Notes, the Extension Coupon and the Reference Price of the New Notes. During the term of the Exchange Offer, Holders of the Old Notes can obtain current information regarding the Benchmark Treasury Yield, reference yields, reference prices and other information regarding the terms of the Exchange Offer from the Financial Advisor at (800) 334-1604 (toll free) or (212) 892-3351 (call collect), attention Paul S. Galant. In addition, the Company intends to publish information about the Exchange Offer, including the information described in the preceding paragraph when available, on the MCM "CorporateWatch" Service on Telerate page 64150. In the event any dispute arises with respect to any Benchmark Treasury Yield, reference yields, reference prices, the Extension Coupon or any quotation or calculation with respect to the Exchange Offer, the Company's determination shall be conclusive and binding absent manifest error. EXPIRATION DATE; EXTENSIONS; TERMINATION; AMENDMENTS The Exchange Offer will expire at 5:00 p.m., New York City time, on the Expiration Date, unless extended by the Company as provided herein. In the event that the Exchange Offer is extended, the term "Expiration Date" with respect to such extended Exchange Offer shall mean the time and date on which the Exchange Offer, as so extended, shall expire. The Company expressly reserves the right, in its sole discretion, subject to applicable law, to (i) extend or terminate the Exchange Offer and not accept for exchange any tendered Old Notes if any of the conditions specified in "-- Conditions to the Exchange Offer" are not satisfied or waived, (ii) waive any condition to the Exchange Offer and accept all Old Notes tendered pursuant to the Exchange Offer, (iii) extend the Exchange Offer and retain all the Old Notes tendered pursuant to the Exchange Offer until the expiration of the Exchange Offer, subject, however, to the withdrawal rights of Holders as provided in, "-- Withdrawal Rights", (iv) amend the terms of the Exchange Offer and (v) modify the form of the consideration to be paid pursuant to the Exchange Offer. Any extension, termination or amendment will be followed as promptly as practicable by a public announcement and notification to the Exchange Agent. In the case of any extension, a public announcement will be issued prior to 9:00 a.m., New York City time, on the next business day after the previously scheduled Expiration Date of the Exchange Offer. Without limiting the manner in which the Company may choose to make any public announcement, the Company shall have no obligation to publish, advertise or otherwise communicate any such public announcement other than by release to the Dow Jones News Service or otherwise as required by law. In the event of any extension of the Exchange Offer, all Old Notes tendered pursuant to the Exchange Offer and not subsequently withdrawn, will remain subject to, and Holders will continue to have withdrawal rights until the expiration of, the Exchange Offer. EFFECT OF TENDER A tendering Holder of Old Notes that are exchanged in the Exchange Offer will not be obligated to pay transfer taxes or any fees or commissions with respect to the acquisition of their Old Notes by the Company pursuant to the Exchange Offer. See "--Transfer Taxes". However, if the beneficial owner tenders through a Custodian, such beneficial owner may be required to pay fees or commissions to such institution. 23 ABSENCE OF DISSENTERS' RIGHTS Holders of Old Notes do not have any appraisal or dissenters' rights under the Delaware General Corporation Law or the Old Indenture, in connection with the Exchange Offer. ACCEPTANCE OF OLD NOTES TENDERED FOR EXCHANGE; DELIVERY OF NEW NOTES Upon the terms and subject to the conditions of the Exchange Offer, the Company will exchange Old Notes by accepting such Old Notes for exchange and in consideration will issue a like principal amount of New Notes. New Notes will be delivered on the Exchange Date. The Exchange Agent will act as agent for the tendering Holders for the purpose of receiving Old Notes and delivering New Notes to such Holders. In all cases, Old Notes will be accepted for exchange pursuant to the Exchange Offer only after timely receipt by the Exchange Agent of certificates representing Old Notes (or confirmation of a book-entry transfer), a properly completed and duly executed Letter of Transmittal (or a manually signed facsimile thereof or satisfaction of DTC's ATOP procedures) and any other documents required thereby. New Notes will be delivered only in book-entry form through DTC and only to the DTC account of the tendering Holder or the tendering Holder's Custodian. Accordingly, a Holder who tenders Old Notes must specify on the Letter of Transmittal the DTC participant to which New Notes should be delivered and all necessary account information to effect such delivery. Failure to provide such information will render such Holder's tender defective and the Company will have the right, which it may waive, to reject such tender. The Company and the Exchange Agent shall not incur any liability for delivering New Notes in accordance with any instructions provided by a tendering Holder. The Company will be deemed to have accepted for exchange tendered Old Notes as, if and when the Company gives oral or written notice to the Exchange Agent of the Company's acceptance of such Old Notes for exchange. Old Notes accepted for exchange by the Company will be canceled. Upon acceptance of Old Notes for exchange, the Company will pay a Participation Fee to tendering Holders of 1.50% of the principal amount tendered. The Company will not pay any Participation Fee to Holders for any Old Notes not tendered in the Offer. If Old Notes in a principal amount in excess of the principal amount indicated as being tendered on the Letter of Transmittal are submitted, an Old Note in a principal amount equal to the excess principal amount over the amount indicated as tendered in the Letter of Transmittal will be issued to the tendering Holder or the tendering Holder's Custodian, at the Company's expense, in the same form in which such security was tendered, as promptly as practicable following the expiration or termination of the Exchange Offer. If any tendered Old Notes are not accepted for exchange because of an invalid tender, the occurrence of certain other events set forth herein or otherwise, such Old Notes will be returned, at the Company's expense, to the tendering holder thereof, as promptly as practicable following the expiration or termination of the Exchange Offer. PROCEDURES FOR TENDERING OLD NOTES Minimum Denominations. A Holder may tender less than all Old Notes held by such Holder. However, Old Notes may be tendered only in denominations of $1,000 or an integral multiple thereof. Tender of Old Notes Held in Physical Form. To tender Old Notes held in physical form, a Holder must (i) complete (including the required information regarding delivery of New Notes through DTC) and sign the Letter of Transmittal in accordance with the instructions set forth therein and (ii) deliver the properly completed and executed Letter of Transmittal, together with any other documents required by the Letter of Transmittal, and 24 the Old Notes in physical form to the Exchange Agent at the address set forth on page 5 hereof prior to the Expiration Date. Tender of Old Notes Held Through a Custodian. To tender Old Notes held by a Custodian, the beneficial owner of the Old Notes must contact the Custodian and direct the Custodian to tender such Old Notes in accordance with the procedures set forth herein and in the Letter of Transmittal. The Exchange Agent and DTC have confirmed that the Exchange Offer is eligible for ATOP. Accordingly, DTC participants may electronically transmit their acceptance of the Exchange Offer by causing DTC to transfer Old Notes to the Exchange Agent in accordance with DTC's ATOP procedures for such a transfer. DTC will then send an Agent's Message to the Exchange Agent. The term "Agent's Message" means a message transmitted by DTC, received by the Exchange Agent and forming part of a Book-Entry Confirmation (as defined herein), which states that DTC has received an express acknowledgment from the DTC participant tendering Old Notes which are the subject of such Book-Entry Confirmation, that such DTC participant has received and agrees to be bound by the terms of the Letter of Transmittal and that the Company may enforce such agreement against such DTC participant. In the case of an Agent's Message relating to a guaranteed delivery, the term means a message transmitted by DTC and received by the Exchange Agent, which states that DTC has received an express acknowledgment from the DTC participant tendering Old Notes that such DTC participant has received and agrees to be bound by the Notice of Guaranteed Delivery (as described below). Holders desiring to tender Old Notes on the Expiration Date should note that such Holders must allow sufficient time for completion of the ATOP procedures during the normal business hours of DTC on that date. If the Custodian holds such Old Notes in physical form, the Custodian must follow the procedure set forth above under "Procedures for Tendering Old Notes - Tender of Old Notes Held In Physical Form". If the Custodian holds such Old Notes in book-entry form through DTC (the "Book-Entry Transfer Facility"), to tender such Old Notes the Custodian must effect a book-entry transfer (a "Book-Entry Confirmation") of all Old Notes to be tendered to the Exchange Agent's account at such Book-Entry Transfer Facility prior to the Expiration Date. BOOK-ENTRY DELIVERY PROCEDURES The Exchange Agent will establish promptly an account with respect to the Old Notes at the Book-Entry Transfer Facility for purposes of the Exchange Offer. Any financial institution that is a participant in the Book-Entry Transfer Facility may make a book-entry delivery of Old Notes by causing the Book-Entry Transfer Facility to transfer Old Notes to the Exchange Agent's account. Delivery of a Letter of Transmittal to a Book-Entry Transfer Facility will not constitute valid delivery to the Exchange Agent. LETTERS OF TRANSMITTAL AND OLD NOTES MUST BE SENT ONLY TO THE EXCHANGE AGENT. DO NOT SEND LETTERS OF TRANSMITTAL OR OLD NOTES TO THE COMPANY, THE TRUSTEE, THE INFORMATION AGENT OR THE FINANCIAL ADVISOR. Any Holder whose Old Notes have been mutilated, lost, stolen or destroyed will be responsible for obtaining replacement securities or for arranging for indemnification with Bankers Trust Company, as trustee for the Old Notes. Holders may contact the Information Agent for assistance with such matters. In order for a tendering Holder to be assured of participating in an Exchange Offer, such Holder must tender Old Notes in accordance with the procedures set forth herein and in the Letter of Transmittal prior to the 25 Expiration Date. The method of delivery of Old Notes and all other required documents is at the option and risk of the Holder. If delivery is by mail, registered mail with return receipt requested, properly insured, is recommended and enough time should be allowed to ensure timely delivery. GUARANTEED DELIVERY PROCEDURES If a Holder of Old Notes wishes to tender such Old Notes and time will not permit such Holders of the Old Notes or other required documents to reach the Exchange Agent prior to the Expiration Date, or the procedure for book-entry transfer cannot be completed on a timely basis, a tender may be effected if (i) the tender is made through an Eligible Institution (as such term is defined in the Letter of Transmittal), (ii) on or prior to 5:00 p.m., New York City time, on the Expiration Date, the Exchange Agent receives from such Eligible Institution a properly completed and duly executed Notice of Guaranteed Delivery, substantially in the form provided by the Company (by facsimile transmission, mail or hand delivery), setting forth the name and address of the holder of Old Notes and the amount of Old Notes tendered, stating that the tender is being made thereby and guaranteeing that within three New York Stock Exchange ("NYSE") trading days after the date of execution of the Notice of Guaranteed Delivery, the certificates for all physically tendered Old Notes, in proper form for transfer or a Book-Entry Confirmation, as the case may be, together with a properly completed and duly executed Letter of Transmittal (or manually signed facsimile thereof) with any required signature guarantees and any other documents required by the Letter of Transmittal will be deposited by the Eligible Institution with the Exchange Agent, and (iii) the certificates for all physically tendered Old Notes, in proper form for transfer, or a Book-Entry Confirmation, as the case may be, together with a properly completed and duly executed Letter of Transmittal (or manually signed facsimile thereof) with any required signature guarantees, and any other documents required by the Letter of Transmittal are deposited by the Eligible Institution within three NYSE trading days after the date of execution of the Notice of Guaranteed Delivery. PROPER EXECUTION AND DELIVERY OF LETTER OF TRANSMITTAL In general, all signatures on a Letter of Transmittal or a notice of withdrawal must be guaranteed by an Eligible Institution; however, such signatures need not be guaranteed if (a) the Letter of Transmittal is signed by the Holder of the Old Notes tendered thereby or by a participant in a Book-Entry Transfer Facility whose name appears on a security position listing as the Holder of the Old Notes tendered thereby and such Holder has not completed the portion entitled "Special Delivery Instructions" on the Letter of Transmittal, or (b) such Old Notes tendered are for the account of an Eligible Institution. If the Letter of Transmittal is signed by the Holder of the Old Notes tendered thereby or a participant in a Book-Entry Transfer Facility whose name appears on a security position listing with respect to the Old Notes tendered thereby, the signature must correspond with the name as written on the face of the Old Notes or on the security position listing, respectively, without any change whatsoever. If any of the Old Notes tendered thereby are held by two or more holders, all such Holders must sign the Letter of Transmittal. If any of the Old Notes tendered thereby are registered in different names on different Old Notes, it will be necessary to complete, sign and submit as many separate Letters of Transmittal as there are different registrations. If the Letter of Transmittal is signed by a person other than the Holder of the Old Notes tendered thereby or a participant in a Book-Entry Transfer Facility whose name appears on a security position listing with respect to the Old Notes tendered thereby, the Old Notes must be endorsed or accompanied by appropriate instruments of transfer, in either case, signed exactly as the name of the Holder appears on the face of the Old Notes or on the security position listing with respect thereto. If the Letter of Transmittal or any Old Notes proxy or instrument of transfer is signed by a trustee, executor, administrator, guardian, attorney-in-fact, officer of a corporation or other person acting in a fiduciary or representative capacity, such person must so indicate when 26 signing, and proper evidence satisfactory to the Exchange Agent of the authority of such person so to act must be submitted. New Notes will be delivered only in book-entry form through DTC and only to the DTC account of the Holder or the Holder's Custodian. If Old Notes not tendered or not exchanged are to be delivered to a person other than the Holder of the Old Notes tendered, or to an address other than that of the Holder of the Old Notes tendered, such Holder should indicate in the portion of the Letter of Transmittal entitled "Special Delivery Instructions" the person and/or address to which such Old Notes are to be delivered. If Old Notes not tendered or not exchanged are to be issued to a person other than the Holder of the Old Notes tendered, the employer identification or social security number of the person to whom issuance is to be made must be indicated on the Letter of Transmittal. If Old Notes not tendered or not exchanged are to be issued to a person other than the Holder of the Old Notes tendered, the Old Notes must be endorsed or accompanied by appropriate instruments of transfer signed exactly as the name of the Holder appears on the face of the Old Notes or the security position listing with respect thereto, with the signature on the certificates or instruments of transfer guaranteed by an Eligible Institution. If no such instructions are given, any Old Notes not tendered or exchanged will be delivered to the Holder of the Old Notes tendered. Because New Notes will be delivered only in book-entry form through DTC, a Holder who tenders Old Notes must specify on the Letter of Transmittal the DTC participant to which New Notes should be delivered and all necessary account information to effect such delivery. Such DTC participant must be either the Holder or a Custodian for the Holder. Failure to provide such information will render such Holder's tender defective and the Company will have the right, which it may waive, to reject such tender. Holders who anticipate tendering other than through DTC are urged to contact promptly a Custodian (that has the capability to hold securities through DTC) to arrange for receipt of any New Notes to be delivered pursuant to the Exchange Offer and to obtain the information necessary to complete the account information table in the Letter of Transmittal. No alternative, conditional, irregular or contingent tenders will be accepted. By executing the Letter of Transmittal, the Holder of Old Notes waives any right to receive any notice of the acceptance for exchange of such Holder's Old Notes, except as otherwise provided herein. All questions as to the validity, form, eligibility (including time of receipt) and acceptance of tendered Old Notes will be determined by the Company, whose determination shall be conclusive and binding. The Company reserves the absolute right to reject any or all tenders that are not in proper form or the acceptance of which may be, in the opinion of counsel for the Company, unlawful. The Company also reserves the absolute right to waive any condition of the Exchange Offer as set forth under "--Conditions to the Exchange Offer" and any irregularities or conditions of tender as to particular Old Notes. The Company's interpretation of the terms and conditions of the Exchange Offer (including the instructions in the Letters of Transmittal) shall be conclusive and binding. Unless waived, any irregularities in connection with tenders must be cured within such time as the Company may determine. The Company, the Exchange Agent and the Information Agent shall not be under any duty to give notification of defects in such tenders and shall not incur liability for any failure to give such notification. Tenders of Old Notes will not be deemed to have been made until such irregularities have been cured or waived. Any Old Notes received by the Exchange Agent that are not properly tendered and as to which the irregularities have not been cured or waived will be returned by the Exchange Agent to the Holder, unless otherwise provided in the Letter of Transmittal, as soon as practicable following the Expiration Date. 27 CONDITIONS TO THE EXCHANGE OFFER Notwithstanding any other provisions of the Exchange Offer or any extension of the Exchange Offer, the Company will not be required to issue New Notes and may terminate the Exchange Offer by oral or written notice to the Exchange Agent, or, at its option, modify or otherwise amend the Exchange Offer with respect to such Old Notes, if any of the following conditions has not been satisfied, on or prior to the Expiration Date: (a) there shall not have been any action taken or threatened, or any statute, rule, regulation, judgment, order, stay, decree or injunction promulgated, enacted, entered, enforced or deemed applicable to the Exchange Offer or the exchange of Old Notes pursuant to the Exchange Offer (the "Exchange"), by or before any court or governmental regulatory or administrative agency or authority or tribunal, domestic or foreign, which (i) challenges the making of the Exchange Offer or the Exchange, or might, directly or indirectly, prohibit, prevent, restrict or delay consummation of the Exchange Offer or the Exchange, or might otherwise adversely affect in any material manner the Exchange Offer or the Exchange or (ii) in the sole judgment of the Company, could materially adversely affect the business, condition (financial or otherwise), income, operations, properties, assets, liabilities or prospects of the Company and its subsidiaries, taken as a whole, or materially impair the contemplated benefits of the Exchange Offer or the Exchange to the Company or might be material to Holders of Old Notes in deciding whether to accept such Exchange Offer; (b) there shall not have occurred or be likely to occur any event affecting the business or financial affairs of the Company that, in the sole judgment of the Company, would or might prohibit, prevent, restrict or delay consummation of the Exchange Offer or the Exchange or that will, or is reasonably likely to, materially impair the contemplated benefits of the Exchange Offer or the Exchange to the Company or might be material to Holders of Old Notes in deciding whether to accept such Exchange Offer; (c) there shall not have occurred (i) any material adverse change in the market price of the Old Notes or the Reference Price of the Old Notes, (ii) a material impairment in the general trading market for debt securities, (iii) a declaration of a banking moratorium or any suspension of payments in respect of banks by federal or state authorities in the United States (whether or not mandatory), (iv) a commencement or escalation of a war, armed hostilities or other national or international crisis directly or indirectly relating to the United States, (v) any limitation (whether or not mandatory) by any governmental authority on, or other event having a reasonable likelihood of affecting, the extension of credit by banks or other lending institutions in the United States, (vi) any material adverse change in United States securities or financial markets generally, or in the case of any of the foregoing existing at the time of the commencement of the Exchange Offer, a material acceleration or worsening thereof or (vii) any general suspension of or limitation on trading in securities on the NYSE or on the over-the-counter market (whether or not mandatory); and (d) the Old Trustee or the New Trustee shall not have objected in any respect to, or taken any action that could in the sole judgment of the Company adversely affect the consummation of, the Exchange Offer or the Exchange nor shall the Old Trustee or the New Trustee have taken any action that challenges the validity or effectiveness of the procedures used by the Company or in making the Exchange Offer or the Exchange. If any of the foregoing conditions are not satisfied, the Company may (i) terminate the Exchange Offer and return such Old Notes to the Holders who tendered them, (ii) extend the Exchange Offer and retain all tendered Old Notes until the expiration of the Exchange Offer, as extended, subject, however, to the withdrawal 28 rights of Holders, see "--Withdrawal Rights" and "--Expiration Date; Extensions; Termination; Amendment"; or (iii) waive any of the conditions with respect to such Exchange Offer and accept all Old Notes tendered therein. The foregoing conditions are for the sole benefit of the Company and may be waived by the Company, in whole or in part, in its sole discretion. Any determination made by the Company concerning an event, development or circumstance described or referred to above shall be conclusive and binding. WITHDRAWAL RIGHTS Tendered Old Notes may be withdrawn by the Holder prior to the Expiration Date. A Holder of Old Notes who tendered Old Notes in physical form may withdraw the Old Notes tendered by providing a written notice of withdrawal (or facsimile thereof) to the Exchange Agent, at its address set forth on page 5 hereof, prior to the Expiration Date, which notice must contain: (i) the name of the person who tendered the Old Notes; (ii) a description of the Old Notes to be withdrawn; (iii) the certificate number or numbers shown on the particular certificate or certificates evidencing such Old Notes; (iv) the aggregate principal amount represented by such Old Notes; (v) the signature of the Holder of such Old Notes executed in the same manner as the original signature on the Letter of Transmittal (including a signature guarantee, if such original signature was guaranteed); and (vi) if such Old Notes are owned by a new beneficial owner, evidence satisfactory to the Company that the person withdrawing the tender has succeeded to the beneficial ownership of the Old Notes. If a beneficial owner of Old Notes tendered through a Custodian wishes to withdraw the Old Notes tendered, such beneficial owner must contact the Custodian and direct the Custodian to withdraw such Old Notes in accordance with the following procedures. In order to withdraw such Old Notes, the Custodian must provide a written notice of withdrawal (or facsimile thereof) to the Exchange Agent, at its address set forth on page 5, prior to the Expiration Date, which notice must contain: (i) the name of the person who tendered the Old Notes; (ii) a description of the Old Notes to be withdrawn; (iii) the certificate number or numbers shown on the particular certificate or certificates evidencing such Old Notes (if Old Notes were tendered in physical form); (iv) the aggregate principal amount represented by such Old Notes; and (v) if such Old Notes are owned by a new beneficial owner, evidence satisfactory to the Company that the person withdrawing the tender has succeeded to the beneficial ownership of the Old Notes. If the Old Notes were tendered by book entry transfer, the Custodian also must debit the Exchange Agent's account at the Book-Entry Transfer Facility through which the tender was made of all Old Notes to be withdrawn. A purported notice of withdrawal which lacks any of the required information will not be an effective withdrawal of a tender previously made. Tenders may not be withdrawn after the Expiration Date. Holders who have tendered in the Exchange Offer will continue to have withdrawal rights following any extension of the Expiration Date. Any permitted withdrawals of tenders of Old Notes may not be rescinded, and any Old Notes so withdrawn will thereafter be deemed not validly tendered for purposes of the Exchange Offer and the Holder thereof will be deemed to have rejected the Exchange Offer. However, withdrawn Old Notes may be re-tendered prior to the Expiration Date by following the procedures for tendering described above. All questions as to the validity (including time of receipt) of notices of withdrawal will be determined by the Company, whose determination will be conclusive and binding. None of the Company, the Exchange Agent or any other person will be under any duty to give notification of any defects or irregularities in any notice of withdrawal or incur any liability for failure to give any such notification. 29 FUTURE OFFERS The Company reserves the right, in its sole discretion, to purchase or make offers for any Old Notes that remain outstanding subsequent to the completion of the Exchange Offer. The terms of any such purchase or offer could differ from the terms of the Exchange Offer. TRANSFER TAXES The Company will pay all transfer taxes, if any, applicable to the transfer and sale of Old Notes pursuant to the Exchange Offer. If, however, substitute Old Notes for amounts not tendered or not exchanged are to be delivered to, or are to be registered in the name of any person other than the Holder of Old Notes tendered, or if tendered Old Notes are registered in the name of any person other than the person signing the Letter of Transmittal, or if a transfer tax is imposed for any reason other than the transfer or sale of Old Notes to the Company pursuant to the Exchange Offer, the amount of any such transfer taxes (whether imposed on the Holder or any other persons) shall be payable by the Holder. If satisfactory evidence of payment of such taxes or exemption therefrom is not submitted with the appropriate Letter of Transmittal, the amount of such transfer taxes will be billed directly to such Holder and/or withheld from any payments due with respect to the Old Notes tendered by such Holder. FINANCIAL ADVISOR The Company has engaged Donaldson, Lufkin & Jenrette Securities Corporation to act as Financial Advisor in connection with the Exchange Offer. Any Holder who has questions concerning the terms of the Exchange Offer or who would like current information regarding the Benchmark Treasury Yield, the reference yields, the reference prices or the Extension Coupon may contact the Financial Advisor at (800) 334-1604 (toll free) or (212) 892-3351 (call collect), or at the address set forth on page 5 of this Offering Circular, attention Paul S. Galant. The Company has agreed to pay the Financial Advisor a fee for its services and to reimburse the Financial Advisor for its reasonable out-of-pocket expenses, including certain reasonable fees and expenses of legal counsel and the Company has agreed to indemnify the Financial Advisor against certain liabilities, including certain liabilities under the federal securities laws, in connection with the Exchange Offer. Milbank, Tweed, Hadley & McCloy, special counsel to the Financial Advisor, is also acting as special tax counsel to the Company in connection with the Exchange Offer. EXCHANGE AGENT IBJ Schroder Bank & Trust Company has been appointed Exchange Agent for the Exchange Offer. The Company will pay the Exchange Agent reasonable and customary fees for its services and will reimburse it for its reasonable out-of- pocket expenses in connection therewith. Letters of Transmittal and all correspondence in connection with the Exchange Offer must be sent or delivered to the Exchange Agent at the address set forth on page 5 of this Offering Circular. INFORMATION AGENT MacKenzie Partners, Inc. has been appointed Information Agent for the Exchange Offer. The Company will pay the Information Agent reasonable and customary fees for its services and will reimburse it for its reasonable out-of-pocket expenses in connection therewith. 30 Any questions concerning the tender procedures or requests for assistance or additional copies of this Offering Circular or the Letters of Transmittal may be directed to the Information Agent at the address and telephone number set forth on page 5 of this Offering Circular. Holders of Old Notes may also contact the Financial Advisor or their broker, dealer, commercial bank, trust company or other nominee for assistance concerning the Exchange Offer. 31 DESCRIPTION OF NEW NOTES The following summaries of certain provisions of the New Notes and the New Indenture do not purport to be complete and are subject, and are qualified in their entirety by reference, to all the provisions of the New Notes and the New Indenture, including the definitions therein of certain terms. GENERAL The New Notes will be issued under the New Indenture. The New Notes are unsecured obligations of the Company and will rank pari passu with all other unsecured and unsubordinated indebtedness of the Company. The New Notes will be issued as a single series of Securities under the New Indenture and will be issued only in fully registered form, without coupons, in denominations of $1,000 or any integral multiple thereof. The New Notes will not be entitled to any sinking fund. The New Notes will be subject to defeasance and discharge and defeasance of certain obligations and certain covenants. The New Notes mature on January 15, 2033 and will bear interest at the rates described herein. Interest on the New Notes will be payable semi-annually on January 15 and July 15 of each year, commencing January 15, 1999, to the Persons in whose names such New Notes are registered at the close of business on the January 1 or the July 1 immediately preceding such interest payment date. The January 15, 1999 interest payment will include interest accruing on the New Notes from July 15, 1998 until, but not including, January 15, 1999. Holders of record of the Old Notes as of July 1, 1998 will be entitled to interest on the Old Notes until, but not including, July 15, 1998. Interest is calculated on the basis of a 360-day year consisting of twelve 30-day months. In any case where the date on which the principal of and premium, if any, and interest, if any, on the New Notes is payable is not a Business Day at any Place of Payment for the New Notes, then (notwithstanding any other provision of the New Indenture or of the New Notes) payment of such principal, premium or interest need not be made at such Place of Payment, but may be made on the next succeeding Business Day at such Place of Payment, provided that no interest shall accrue for the period from and after the date on which such principal, premium or interest is payable. OPTIONAL REDEMPTION The New Notes will be subject to redemption (the "Make-Whole Redemption") at the option of the Company at any time, in whole or from time to time in part, until maturity, upon not less than 30 nor more than 60 days' notice, at a redemption price equal to the sum of (i) the principal amount of the New Notes being redeemed plus accrued and unpaid interest thereon to the Redemption Date, and (ii) the Make-Whole Amount (as defined below), if any, with respect to such New Notes. "Make-Whole Amount" means, in connection with any Make-Whole Redemption of any New Notes, the excess, if any, of (i) the sum, as determined by a Quotation Agent (as defined herein) of the present values of the principal amount of such New Notes, together with scheduled payments of interest from the Redemption Date to the Stated Maturity of the New Notes, in each case discounted to the Redemption Date on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) at the Adjusted Treasury Rate (as defined herein) over (ii) 100% of the principal amount of the New Notes to be redeemed. "Adjusted Treasury Rate" means, with respect to any Redemption Date for a Make-Whole Redemption, the rate per annum equal to the semi-annual equivalent yield to maturity of the Comparable Treasury Issue, calculated using a price for the Comparable Treasury Issue (expressed as a percentage of its principal amount) 32 equal to the Comparable Treasury Price for such Redemption Date, calculated on the third Business Day preceding the Redemption Date, plus in each case 0.20% (20 basis points). "Comparable Treasury Issue" means the United States Treasury security selected by the Quotation Agent as having a maturity comparable to the remaining term from the Redemption Date to the Stated Maturity of the New Notes that would be utilized, at the time of selection and in accordance with customary financial practice, in pricing new issues of corporate debt securities of comparable maturity to the remaining term of the New Notes. "Quotation Agent" means the Reference Treasury Dealer selected by the New Trustee after consultation with the Company. "Reference Treasury Dealer" means a primary U.S. Government securities dealer. "Comparable Treasury Price" means, with respect to any Redemption Date for a Make-Whole Redemption, (i) the average of the bid and asked prices for the Comparable Treasury Issue (expressed in each case as a percentage of its principal amount) on the third Business Day preceding such Redemption Date, as set forth in the daily statistical release designated "H.15" (or any successor release) published by the Board of Governors of the Federal Reserve System or (ii) if such release (or any successor release) is not published or does not contain such prices on such Business Day, (A) the average of the Reference Treasury Dealer Quotations for such Redemption Date, after excluding the highest and lowest such Reference Treasury Dealer Quotations, or (B) if the Trustee obtains fewer than three such Reference Treasury Dealer Quotations, the average of such Quotations. "Reference Treasury Dealer Quotations" means, with respect to each Reference Treasury Dealer and any Redemption Date for a Make-Whole Redemption, the average, as determined by the New Trustee, of the bid and asked prices for the Comparable Treasury Issue (expressed in each case as a percentage of its principal amount) quoted in writing to the New Trustee by such Reference Treasury Dealer at 5:00 p.m., New York City time, on the third Business Day preceding such Redemption Date. Notice of any redemption by the Company will be mailed at least 30 days but not more than 60 days before any Redemption Date to each holder of New Notes to be redeemed. If less than all the New Notes are to be redeemed at the option of the Company, the New Trustee shall select, in such manner as it shall deem fair and appropriate, the New Notes of such series to be redeemed in whole or in part. Unless the Company defaults in payment of the Redemption Price, on and after any Redemption Date, interest will cease to accrue on the New Notes or portions thereof called for redemption. BOOK-ENTRY PROCEDURES Upon issuance, all New Notes will be represented by one or more fully registered global securities (each a "Global Security"). Each such Global Security will be deposited with, or on behalf of, The Depository Trust Company, as Depository, registered in the name of the Depository or a nominee thereof. Unless and until it is exchanged in whole or in part for New Notes in definitive form, no Global Security may be transferred except as a whole by the Depository to a nominee of such Depository or by a nominee of such Depository to such Depository. The Depository has advised the Company as follows: The Depository is a limited-purpose trust company organized under the Banking Law of the state of New York, a member of the Federal Reserve System, a "clearing corporation" within the meaning of the New York Uniform Commercial Code, and a "clearing agency" registered pursuant to the provisions of Section 17A of the Exchange Act. The Depository was created to hold securities of its participants (defined below) and to facilitate the clearance and settlement transactions 33 among its participants in such securities through electronic book-entry changes in accounts of the participants, thereby eliminating the need for physical movement of securities certificates. The Depository's participants include securities brokers and dealers (including the Underwriters), banks, trust companies, clearing corporations, and certain other organizations, some of whom (and/or their representatives) own the Depository. Access to the Depository's book-entry system is also available to others, such as banks, brokers, dealers and trust companies that clear through or maintain a custodial relationship with a participant, either directly or indirectly. Ownership of beneficial interests in the New Notes will be limited to Persons that have accounts with the Depository ("participants") or Persons that may hold interests through participants. The Depository has advised the Company that upon the issuance of the Global Securities representing the New Notes, the Depository will credit, on its book-entry registration and transfer system, the participants' accounts with the respective principal amounts of the New Notes. Ownership of beneficial interests in such Global Securities will be shown on, and the transfer of such ownership interests will be effected only through, records maintained by the Depository (with respect to interests of participants) and on the records of participants (with respect to interests of Persons holding through participants). The laws of some states may require that certain purchasers of securities take physical delivery of such securities in definitive form. Such limits and such laws may impair the ability to own, transfer or pledge beneficial interests in Global Securities. So long as the Depository, or its nominee, is the registered owner of a Global Security, the Depository or its nominee, as the case may be, will be considered the sole owner or Holder of the New Notes represented by such Global Security for all purposes under the New Indenture. Except as provided below, owners of beneficial interests in a Global Security will not be entitled to have the New Notes represented by such Global Securities registered in their names, will not receive or be entitled to receive physical delivery of the New Notes in definitive form and will not be considered the owners or Holders thereof under the New Indenture. Accordingly, each Person owning a beneficial interest in a Global Security must rely on the procedures of the Depository and, if such Person is not a participant, on the procedures of the participant through which such Person owns its interest, to exercise any rights of a Holder under the New Indenture. The Company understands that under existing industry practices, in the event that the Company requests any action of Holders or that an owner of a beneficial interest in such a Global Security desires to give or take any action which a Holder is entitled to give or take under the New Indenture, the Depository would authorize the participants holding the relevant beneficial interests to give or take such action, and such participants would authorize beneficial owners owning through such participants to give or take such action or would otherwise act upon the instructions of beneficial owners holding through them. Payment of principal of, and interest on, New Notes registered in the name of the Depository or its nominee will be made to the Depository or its nominee, as the case may be, as the Holder of the Global Securities representing the New Notes. None of the Company, the New Trustee or any other agent of the Company or agent of the New Trustee will have any responsibility or liability for any aspect of the records relating to or payments made on account of beneficial ownership interests or for supervising or reviewing any records relating to such beneficial ownership interests. The Depository, upon receipt of any payment of principal or interest in respect of a Global Security, will credit the accounts of the participants with payment in amounts proportionate to their respective beneficial interests in such Global Security as shown on the records of the Depository. Payments by participants to owners of beneficial interests in a Global Security will be governed by standing customer instructions and customary practices, as is now the case with securities held for the accounts of customers in bearer form or registered in "street name", and will be the responsibility of such participants. 34 If (x) the Depository is at any time unwilling or unable to continue as Depository or the Depository ceases to be a clearing agency registered under the 1934 Act, (y) the Company executes and delivers to the New Trustee a Company Order to the effect that the Global Securities shall be transferable and exchangeable or (z) an Event of Default has occurred and is continuing with respect to the New Notes, the Global Securities will be transferable or exchangeable for New Notes in definitive form of like tenor in an equal aggregate principal amount. Such definitive New Notes shall be registered in such name or names as the Depository shall instruct the New Trustee. It is expected that such instructions may be based upon directions received by the Depository from participants with respect to ownership of beneficial interests in such Global Securities. EVENTS OF DEFAULT The following are Events of Default with respect to the New Notes: (a) failure to pay any interest on any New Note when due, continued for 30 days; (b) failure to pay principal of or premium, if any, on any New Note when due; (c) failure to perform any other covenant of the Company in the New Indenture (other than a covenant included in the New Indenture solely for the benefit of series of Debt Securities other than the New Notes), continued for 90 days after written notice as provided in the New Indenture; (d) the acceleration, or failure to pay at maturity (including any applicable grace period), of any indebtedness for money borrowed by the Company exceeding $20,000,000 in principal amount, which acceleration or failure to pay is not rescinded or annulled or indebtedness paid within 15 days after the date on which written notice thereof shall have first been given to the Company as provided in the New Indenture; and (e) certain events in bankruptcy, insolvency or reorganization in respect of the Company. If an Event of Default with respect to the New Notes occurs and is continuing, either the New Trustee or the Holders of at least 25 percent in principal amount of the New Notes may declare the principal amount of all New Notes to be due and payable immediately. At any time after a declaration of acceleration with respect to the New Notes has been made, but before a judgment or decree based on acceleration has been obtained, the Holders of a majority in principal amount of the New Notes may, under certain circumstances, rescind and annul such acceleration. For information as to waiver of defaults, see "-Modification and Waiver." The New Trustee will not be under any obligation, subject to the duty of the New Trustee during default to act with the required standard of care, to exercise any of its rights or powers under the New Indenture at the request or direction of any of the Holders of New Notes, unless such Holders shall have offered to such New Trustee reasonable security or indemnity. Subject to such provisions for indemnification of the New Trustee, the Holders of a majority in principal amount of the New Notes will have the right to direct the time, method and place of conducting any proceeding for any remedy available to such New Trustee, or exercising any trust or power conferred on such New Trustee, with respect to the New Notes. The Company will furnish to the New Trustee annually a certificate as to compliance with all conditions and covenants under the New Indenture. MODIFICATION AND WAIVER Modifications and amendments of the New Indenture may be made by the Company and the New Trustee with the consent of the Holders of not less than 66 2/3 percent in principal amount of the Outstanding Securities of each series issued under the New Indenture affected by such modification or amendment; provided, however, that no such modification or amendment may, without the consent of the Holder of each New Note affected thereby, (a) change the Stated Maturity of the principal of, or any installment of principal of or interest on, any New Note, (b) reduce the principal amount of, or the premium, if any, or the rate of interest on, any New Note, (c) change the place or currency of payment of principal of, or premium, if any, or the rate of interest on, any New Note, (d) impair the right to institute suit for the enforcement of any payment on or with respect to any 35 New Note, or (e) reduce the percentage in principal amount of the Outstanding New Notes or the percentage of Holders, the consent of which is required for modification or amendment of the New Indenture for the New Notes or for waiver of compliance with certain provisions of the New Indenture or for waiver of certain defaults. The New Indenture provides that the Holders of a majority in principal amount of the New Notes may, on behalf of the Holders of the New Notes, waive any past default under the New Indenture with respect to the New Notes, except a default in the payment of the principal of or premium, if any, or interest on any New Notes or in respect of a provision which under the New Indenture cannot be modified or amended without the consent of the Holder of each Outstanding New Note. The New Indenture provides that the Holders of not less than a majority in principal amount of the Outstanding New Notes may, on behalf of the Holders of all New Notes, waive, insofar as that series is concerned, compliance by the Company with certain restrictive provisions of the New Indenture. CONSOLIDATION, MERGER AND SALE OF ASSETS The Company may, without the consent of any Holders of Outstanding New Notes, consolidate or merge with or into, or transfer or lease its assets substantially as an entirety to, any Person, and any other Person may consolidate or merge with or into, or transfer or lease its assets substantially as an entirety to, the Company, provided that (i) the Person (if other than the Company) formed by such consolidation or into which the Company is merged, or the Person, if other than a wholly-owned Subsidiary (except for directors' qualifying shares), which acquires or leases the assets of the Company substantially as an entirety is organized under the laws of any United States jurisdiction and assumes the Company's obligations on the New Notes and under the New Indenture, (ii) after giving effect to the transaction, no Event of Default, and no event related to such transaction which, after notice or lapse of time or both, would become an Event of Default, shall have happened and be continuing and (iii) certain other conditions are met. LIMITATION ON LIENS The New Indenture provides that the Company will not, and will not permit any Subsidiary, directly or indirectly, to create, issue, assume, incur or guarantee any indebtedness for money borrowed which is secured by a mortgage, pledge, lien, security interest or other encumbrance of any nature on any of the present or future common stock of a Designated Subsidiary (as defined below) (or any company, other than the Company, having direct or indirect control of any Designated Subsidiary) unless the Securities of all series under the New Indenture and, if the Company so elects, any other indebtedness of the Company ranking at least pari passu with the Securities, shall be secured equally and ratably with, or prior to, such other secured indebtedness for money borrowed so long as it is outstanding. The Company does not believe that the covenant described above will have a material effect on the Company's or any Subsidiary's ability to conduct its operations. A similar covenant has appeared in other indentures and agreements relating to outstanding long-term indebtedness of the Company and guarantees by the Company of long-term indebtedness of Subsidiaries, and such covenant has not had a material effect on the operations of the Company or any Subsidiary. This covenant does not restrict the ability of the Company or any Subsidiary to mortgage, pledge or grant liens, security interests or other encumbrances of any nature on any property or assets other than the common stock of a Designated Subsidiary. The Company believes that this covenant may provide some benefit to Holders of the New Notes in the event the Company or any Subsidiary finds it necessary to obtain financing secured by the common stock of a Designated Subsidiary. 36 The term "Designated Subsidiary" means each of CIGNA Property and Casualty Insurance Company, Connecticut General Life Insurance Company and Insurance Company of North America, so long as such company remains a Subsidiary, or any Subsidiary which is a successor of such Designated Subsidiary. DEFEASANCE Defeasance and Discharge. The New Indenture provides that the Company will be discharged from any and all obligations in respect of the New Notes (except for certain obligations to register the transfer or exchange of the New Notes, to replace stolen, lost or mutilated New Notes, to maintain paying agencies and to hold monies for payment in trust) upon the deposit with the New Trustee, or another qualified corporate trustee, in trust, of money and/or U.S. Government Obligations which through the payment of interest and principal in respect of such U.S. Government Obligations in accordance with their terms will provide money in an amount sufficient to pay the principal of and premium, if any, and each installment of interest on the New Notes on the Stated Maturity of such payments and any mandatory sinking fund payments or analogous payments applicable to the New Notes on the day on which such payments are due and payable in accordance with the terms of the New Indenture and the New Notes. Such a trust may only be established if, among other things, (i) either (x) the Company has delivered to the New Trustee an Opinion of Counsel to the effect that since the date of the New Indenture there has been a change in the applicable federal income tax law, including a change in the official interpretation thereof, or (y) the Company has received from, or there has been published by, the Internal Revenue Service a ruling, in either case to the effect that Holders of the New Notes will not recognize income, gain or loss for federal income tax purposes as a result of such deposit, defeasance and discharge and will be subject to federal income tax on the same amounts and in the same manner and at the same times, as would have been the case if such deposit, defeasance and discharge had not occurred, and (ii) the Company has delivered to the New Trustee an Opinion of Counsel to the effect that the New Notes, if then listed on the New York Stock Exchange, will not be delisted as a result of such deposit, defeasance and discharge. Defeasance of Certain Obligations and Certain Events of Default. The New Indenture provides that, if applicable, the Company may omit to comply with the restrictive covenants in Section 1005 ("Maintenance of Properties") or Section 1006 ("Limitation on Liens on Common Stock of Designated Subsidiaries"), and Section 501(4) (described in clause (c) under "Events of Default") with respect to Sections 1005 and 1006 and Section 501(5) (described in clause (d) under "Events of Default") shall be deemed not to be an Event of Default under the New Indenture with respect to the New Notes, upon the deposit with the New Trustee, or another qualified corporate trustee, in trust, of money and/or U.S. Government Obligations which through the payment of interest and principal in respect of such U.S. Government Obligations in accordance with their terms will provide money in an amount sufficient to pay the principal of and premium, if any, and each installment of interest on the New Notes on the Stated Maturity of such payments and any mandatory sinking fund payments or analogous payments applicable to the New Notes on the day on which such payments are due and payable in accordance with the terms of the New Indenture and the New Notes. The obligations of the Company under the New Indenture and the New Notes other than with respect to the covenants referred to above and the Events of Default other than the Events of Default referred to above shall remain in full force and effect. Such a trust may only be established if, among other things, the Company has delivered to the New Trustee an Opinion of Counsel to the effect that (i) the Holders of the New Notes will not recognize income, gain or loss for federal income tax purposes as a result of such deposit and defeasance of certain obligations and Events of Default and will be subject to federal income tax on the same amounts and in the same manner and at the same times, as would have been the case if such deposit and defeasance had not occurred, and (ii) the New Notes, if then listed on the New York Stock Exchange, will not be delisted as a result of such deposit and defeasance. In the event the Company exercises its option to omit compliance with certain covenants of the New Indenture with respect to the New Notes as described above and the New Notes are declared due and payable 37 because of the occurrence of any Event of Default other than an Event of Default described above in clause (c) or (d) under "Events of Default," the amount of money and U.S. Government Obligations on deposit with the New Trustee, or another qualified corporate trustee, will be sufficient to pay amounts due on the New Notes at the time of their Stated Maturity but may not be sufficient to pay amounts due on the New Notes at the time of the acceleration resulting from such Event of Default. However, the Company will remain liable for such payments. If the Company fails to pay such amounts as and when required by the terms of the New Indenture, the New Trustee may institute and prosecute a judicial proceeding for the collection of such amounts and may enforce any judgment or final decree obtained in such proceeding. CONCERNING THE NEW TRUSTEE The Company and certain of its subsidiaries in the ordinary course of business maintain general banking relations with Marine Midland Bank. Pursuant to the provisions of the Trust Indenture Act of 1939, upon a default under either the New Indenture or the Company's Convertible Subordinated Indenture, Marine Midland Bank may be deemed to have a conflicting interest by virtue of its acting as New Trustee under the New Indenture and Trustee under the Company's Subordinated Indenture requiring it to resign and be replaced by a successor trustee in one of such positions. 38 CERTAIN U.S. FEDERAL INCOME TAX CONSEQUENCES The following discussion is a summary of certain federal income tax consequences of the Exchange Offer to Holders of Old Notes and of the ownership and disposition of New Notes acquired pursuant to the Exchange Offer. The statements of law and legal conclusions set forth in this summary are based on the opinion of Milbank, Tweed, Hadley & McCloy, special tax counsel to the Company for the Exchange Offer and counsel to the Financial Advisor. This summary is based on the Internal Revenue Code of 1986, as amended (the "Code"). Treasury Regulations, Internal Revenue Service ("IRS") rulings, official pronouncements and judicial decisions, all as in effect on the date hereof and all of which are subject to change, possibly with retroactive effect, or different interpretations. This summary is applicable only to persons who hold Old Notes as capital assets and who will hold New Notes as capital assets. This summary does not discuss all the federal income tax consequences that may be relevant to a Holder in light of the Holder's particular circumstances. In particular, this summary does not address any special rules that may be applicable to insurance companies, tax-exempt persons, financial institutions, regulated investment companies, dealers in securities or currencies, pass- through entities, persons that hold Old Notes or New Notes as part of an integrated investment (including a "straddle") consisting of Old Notes or New Notes and one or more other positions, foreign corporations, persons who are not citizens or residents of the United States, or persons whose functional currency is other than the United States dollar. In addition, this summary does not address any state or local tax considerations that may be relevant to a Holder's decision to exchange Old Notes for New Notes pursuant to the Exchange Offer. THE FOLLOWING IS NOT TAX ADVICE TO ANY HOLDER OF OLD NOTES. ALL HOLDERS OF OLD NOTES SHOULD CONSULT THEIR OWN TAX ADVISORS REGARDING THE UNITED STATES FEDERAL, STATE AND LOCAL TAX CONSEQUENCES OF THE EXCHANGE OF OLD NOTES FOR NEW NOTES AND OF THE OWNERSHIP AND DISPOSITION OF NEW NOTES RECEIVED IN THE EXCHANGE OFFER IN LIGHT OF THEIR OWN PARTICULAR CIRCUMSTANCES. EXCHANGE OF OLD NOTES FOR NEW NOTES The exchange of Old Notes for New Notes (the "Exchange") pursuant to the Exchange Offer will constitute a recapitalization within the meaning of section 368(a)(1)(E) of the Code. A Holder of Old Notes who exchanges Old Notes for New Notes will recognize no gain or loss on the Exchange, except that a cash-basis holder of Old Notes who exchanges Old Notes for New Notes may be required to recognize as interest income received on the Exchange Date an amount equal to the interest accrued on such Old Notes from July 15, 1998 through the Exchange Date. An exchanging Holder's tax basis in New Notes received in the Exchange will be the same as such Holder's tax basis in the Old Notes exchanged. An exchanging Holder's holding period for the New Notes received in the Exchange will include its holding period for the Old Notes exchanged. If a Holder's tax basis in Old Notes immediately after the acquisition of Old Notes exceeded the principal amount of such Old Notes, such excess constituted amortizable bond premium which the Holder may have elected to amortize under a constant yield method under section 171 of the Code. If such an electing Holder exchanges Old Notes for New Notes, the remaining bond premium on the New Notes would be amortizable over the extended term of the New Notes. Some Holders of Old Notes may have acquired them at a "market discount." For this purpose "market discount" is the excess (if any) of the principal amount over the Holder's acquisition price, subject to a statutory de minimis exception. While accrued market discount generally must be recognized to the extent of gain realized on the disposition of a market discount debt instrument, the Exchange will not cause any exchanging Holders of Old Notes who acquired them at a market discount to recognize any accrued market discount as 39 income. Instead, any accrued market discount on Old Notes that are exchanged for New Notes will attach to the New Notes. In addition, unaccrued market discount on such Old Notes will accrue over the extended term of the New Notes. NEW NOTES Stated Interest on New Notes. In general, payments of "qualified stated interest" on the New Notes will be ordinary income, taxable when accrued, in the case of a Holder utilizing the accrual method of accounting, or when received in the case of a holder utilizing the cash method of accounting. Qualified stated interest on the New Notes will equal interest payable at a rate equal to the lower of 8.30% or the Extension Coupon. Payments of interest in excess of qualified stated interest will be treated as payments of principal which will result in whole or in part in the recognition of additional income depending on the Holder's basis in the New Notes. No Original Issue Discount. The New Notes will not be treated as issued with original issue discount ("OID"), assuming, as is expected, the stated redemption price at maturity ("SRPM") of the New Notes will not exceed their issue price by more than a statutory de minimis amount. The SRPM of the New Notes will equal the sum of the principal amount plus the portion of interest in excess of the lower of 8.30% or the Extension Coupon. The issue price of the New Notes will be their fair market value on their date of issue if, as expected the New Notes are considered to be "traded on an established market." If the New Notes were not considered to be traded on an established market, their issue price would be the fair market value of the Old Notes, which are so traded. In either case, the issue price is expected to exceed the SRPM. Bond Premium. If a Holder's tax basis in the New Notes immediately after the Exchange exceeds the SRPM of such New Notes, such excess will constitute amortizable bond premium which the Holder may elect to amortize under a constant yield method under section 171 of the Code. A Holder that elects to amortize bond premium must reduce the tax basis in the New Notes by the amount so amortized. The amortizable bond premium will be treated as an offset to interest income rather than as a separate deduction item. An election to amortize bond premium under section 171 of the Code by a Holder will apply to all obligations owned or acquired by the Holder in the current and all subsequent taxable years and may not be revoked without the permission of the IRS. If an election to amortize bond premium is not made, a Holder must include the full amount of each interest payment in income in accordance with its regular method of accounting and will receive a tax benefit from the premium only in computing gain or loss upon the redemption, sale or other disposition of the New Notes. Market Discount. If a Holder's basis in the New Notes immediately after the Exchange is less than their SRPM by more than a statutory de minimis amount the Holder will have market discount with respect to the New Notes. If the New Notes have market discount any gain realized on sale or redemption of the New Notes or receipt of payments other than qualified stated interest would be treated as ordinary income to the extent of accrued market discount that has not previously been taken into income. In addition, a Holder may be required to defer deductions for interest on indebtedness incurred or continued to purchase or carry the New Notes to the extent of market discount that accrues but is not taken into account currently. For these purposes market discount is deemed to accrue on a straight-line basis unless the Holder has made an election to treat market discount as accruing on a constant yield basis. In addition, a Holder may elect to include market discount in income as it accrues on all market discount obligations acquired by the Holder in the year of election or thereafter. If that election is made, the deferral of interest deductions described above will not be required. Redemption or Sale of the New Notes. In general, upon a redemption, sale or other disposition of the New Notes, a Holder will recognize gain or loss equal to the difference between (i) the amount realized on the 40 disposition (other than amounts attributable to accrued interest) and (ii) the Holder's tax basis in the New Notes. Subject to the application of the market discount rules, such gain or loss will be capital gain or loss. CASH PAYMENTS Cash payments will be treated as fees for participating in the Offer and will constitute ordinary income to recipient United States Holders. BACKUP WITHHOLDING A Holder of New Notes may be subject to backup withholding at a rate of 31 percent with respect to interest paid or the proceeds of a redemption, sale or other disposition of New Notes, unless the Holder provides its taxpayer identification number and certain required certifications to the payor or otherwise establishes an exemption. Any amounts so withheld would be allowed as a credit against the Holder's federal income tax liability. PLAN OF DISTRIBUTION The Company will exchange New Notes for Old Notes. Accordingly, the Company will not receive any proceeds from the exchange of New Notes for Old Notes. Based on an interpretation by the staff of the Division of Corporation Finance of the Commission, the Company believes that the New Notes issued pursuant to the Exchange Offer may be offered for resale, resold and otherwise transferred by any Holder thereof without compliance with the registration requirements of the Securities Act. The Company has not entered into any arrangement or understanding with any person to distribute the New Notes to be received in the Exchange Offer and, to the best of the Company's information and belief, each person participating in the Exchange Offer is acquiring the New Notes in the ordinary course of business and has no arrangement or understanding with any person to participate in the distribution of the New Notes. The Company has agreed to pay all expenses incident to the Exchange Offer (other than commissions or concessions of any brokers or dealers). VALIDITY OF NEW NOTES The validity of the offered New Notes will be passed upon for the Company by Thomas J. Wagner, Esquire, Executive Vice President and General Counsel, and David R. DeVoe, Esquire, Assistant General Counsel, of CIGNA Corporation. INDEPENDENT ACCOUNTANTS The consolidated financial statements as of December 31, 1997 and 1996 and for each of the three years in the period ended December 31, 1997, incorporated by reference in this Offering Circular from the Company's Annual Report on Form 10- K for the year ended December 31, 1997 have been audited by Price Waterhouse LLP, independent accountants, as stated in their report incorporated by reference herein. 41 SCHEDULE A FIXED SPREAD PRICING FORMULA TO DETERMINE THE REFERENCE PRICE OF THE OLD NOTES YLD = Reference Yield of the Old Notes expressed as a decimal number. CPN = The nominal rate of interest payable on the Old Notes expressed as a decimal number. N = The number of semi-annual interest payments, based on the maturity date of the Old Notes from (but excluding) the Exchange Date to (and including) the maturity date of the Old Notes. S = The number of days from and including the semi-annual interest payment date immediately preceding the Exchange Date up to, but not including, the Exchange Date. The number of days is computed using the 30/360 day-count method. exp = Exponentiate. The term to the left of "exp" is raised to the power indicated by the term to the right of "exp". PRICE = The applicable Reference Price of the Old Notes per $1,000 principal amount of Old Notes. The Reference Price of the Old Notes is rounded to the nearest cent. PRICE = 1,000 --------------------------- (1 + YLD/2) exp (N - S/180) N + (SIGMA) 1,000 (CPN/2) --------------------------- K = 1 (1 + YLD/2) exp (K - S/180) minus 1,000 (CPN/2) (S/180) A-1 SCHEDULE B HYPOTHETICAL PRICING EXAMPLE FOR THE OLD NOTES This Schedule B provides a hypothetical illustration of the calculation of the Reference Price of the Old Notes based on hypothetical data, and should, therefore, be used solely for the purpose of obtaining an understanding of the calculation of the Reference Price of the Old Notes, as quoted at a hypothetical Benchmark Treasury Yield, and should not be used or relied upon for any other purpose. OLD NOTES Maturity Date of the Old Notes: January 15, 2023 Benchmark Treasury Security: 6.125% U.S. Treasury Note due November 15, 2027 2023 Fixed Spread: 1.30% (130 basis points) EXAMPLE: Hypothetical Extension Coupon 2:00 p.m., New York City time, Determination Date: on June 23, 1998 Exchange Date: July 30, 1998 Benchmark Treasury Yield on the Hypothetical Extension Coupon Determination Date = 5.65% 2023 Fixed Spread = 1.30% YLD = 6.95% CPN = 8.30% N = 49 S = 15 PRICE = $1,157.66 B-1 SCHEDULE C FIXED SPREAD PRICING FORMULA TO DETERMINE THE EXTENSION COUPON PRICE OF THE NEW NOTES YLD = Reference Yield of the New Notes expressed as a decimal number. CPN = The nominal rate of interest payable on the New Notes expressed as a decimal number to January 15, 2023. N = The number of semi-annual interest payments, based on the maturity date of the Old Notes from (but excluding) the Exchange Date to (and including) the maturity date of the Old Notes. M = The number of semi-annual interest payments, based on the maturity date of the New Notes from (but excluding) the Exchange Date to (and including) the maturity date of the New Notes. S = The number of days from and including the semi-annual interest payment date immediately preceding the Exchange Date up to, but not including, the Exchange Date. The number of days is computed using the 30/360 day-count method. exp = Exponentiate. The term to the left of "exp" is raised to the power indicated by the term to the right of "exp". PRICE = The applicable Reference Price of the New Notes per $1,000 principal amount of New Notes (which is equal to the Reference Price of the Old Notes). EXT = The nominal rate of interest payable on the New Notes expressed as a decimal number from January 15, 2023 to January 15, 2033. PRICE = 1,000 --------------------------------- (1 + YLD/2) exp (M - S/180) + N 1,000 (CPN/2) (SIGMA) --------------------------------- K = 1 (1 + YLD/2) exp (K - S/180) + M 1,000 (EXT/2) (SIGMA) --------------------------------- K = N + 1 (1 + YLD/2) exp (K - S/180) minus 1,000 (CPN/2) (S/180) C-1 SCHEDULE D HYPOTHETICAL EXTENSION COUPON FOR THE NEW NOTES This Schedule D provides a hypothetical illustration of the calculation of the Extension Coupon of the New Notes based on hypothetical data, and should, therefore, be used solely for the purpose of obtaining an understanding of the calculation of the Extension Coupon of the New Notes, as quoted at a hypothetical Reference Price and Benchmark Treasury Yield, and should not be used or relied upon for any other purpose. NEW NOTES Maturity Date of the New Notes: January 15, 2033 Benchmark Treasury Security: 6.125% U.S. Treasury Note due November 15, 2027 2033 Fixed Spread: 1.40% (140 basis points) EXAMPLE: Hypothetical Extension Coupon 2:00 p.m., New York City time, on June Determination Date: 23, 1998 Exchange Date: July 30, 1998 PRICE = $1,157.66 Benchmark Treasury Yield on the = 5.65% Hypothetical Extension Coupon Determination Date 2033 Fixed Spread = 1.40% YLD = 7.05% CPN = 8.30% N = 49 M = 69 S = 15 EXT = 8.05% D-1 EX-99.T3E.2 3 FORM OF LETTER OF TRANSMITTAL EXHIBIT T3E.2 LETTER OF TRANSMITTAL OFFER TO EXCHANGE NOTES DUE 2033 FOR ANY AND ALL OF THE OUTSTANDING 8.30% NOTES DUE 2023 OF CIGNA CORPORATION PURSUANT TO THE OFFERING CIRCULAR DATED JUNE 24, 1998 - -------------------------------------------------------------------------------- THE EXCHANGE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON THURSDAY, JULY 23, 1998, UNLESS EXTENDED (THE "EXPIRATION DATE"). - -------------------------------------------------------------------------------- PLEASE READ CAREFULLY THE ATTACHED INSTRUCTIONS If you desire to accept the Exchange Offer, this Letter of Transmittal should be completed, signed, and submitted to the Exchange Agent: IBJ SCHRODER BANK & TRUST COMPANY By Facsimile By Mail: (212) 858-2611 By Hand or Overnight Delivery: P.O. Box 84 One State Street Bowling Green Station New York, New York 10004 New York, New York 10274-0084 Attn: Securities Processing Attn: Reorganization Operations Window, Subcellar One (SC-1) Department Confirm by Telephone (212) 858-2103
DELIVERY OF THIS LETTER OF TRANSMITTAL TO AN ADDRESS, OR TRANSMISSION VIA FACSIMILE TO A NUMBER, OTHER THAN AS SET FORTH ABOVE WILL NOT CONSTITUTE A VALID DELIVERY. The Information Agent: MACKENZIE PARTNERS, INC. 156 Fifth Avenue New York, New York 10010 (212) 929-5500 (call collect) (800) 322-2885 (toll free) For any questions regarding this Letter of Transmittal or for any additional information you may contact the Exchange Agent or the Information Agent. The undersigned hereby acknowledges receipt of the Offering Circular dated June 24, 1998 (as it may be supplemented and amended from time to time, the "Offering Circular") of CIGNA Corporation, a Delaware corporation ("Company"), and this Letter of Transmittal (the "Letter of Transmittal") and the Notice of Guaranteed Delivery, of even date herewith, that together constitute the Company's offer (the "Exchange Offer") to exchange an aggregate principal amount of up to $100,000,000 of its Notes Due 2033 (the "New Notes") for a like amount of its issued and outstanding 8.30% Notes Due 2023 (the "Old Notes") from its registered holders (individually, a "Holder" and collectively, the "Holders") thereof. Capitalized terms used but not defined herein have the meanings ascribed to them in the Offering Circular. The undersigned hereby tenders the Old Notes described in Box 1 below, upon the terms and subject to the conditions described in the Offering Circular and this Letter of Transmittal. The undersigned is the Holder of all the Old Notes and the undersigned represents that it has received from each beneficial owner of the tendered Old Notes ("Beneficial Owners") valid instructions which authorize and instruct the undersigned to take the action described in this Letter of Transmittal. Subject to, and effective upon, the acceptance for exchange of the tendered Old Notes, the undersigned hereby exchanges, assigns and transfers to, or upon the order of, the Company all right, title, and interest in, to and under the tendered Old Notes. Holders that tender and do not withdraw their Old Notes will receive upon acceptance of the Old Notes by the Company a participation fee equal to 1.50% of the principal amount tendered (the "Participation Fee"). Please issue the New Notes exchanged for tendered Old Notes in the name(s) of the undersigned. If Old Notes not tendered or not exchanged are to be delivered to, or a check for the Participation Fee is to be issued to, a person other than to the Holder of the Old Notes tendered or to an address other than that of the Holder of such Old Notes, such Holder should so indicate in the section of this Letter of Transmittal entitled "Special Delivery Instructions" below (see Box 2). The undersigned hereby irrevocably constitutes and appoints the Exchange Agent as the true and lawful agent and attorney in fact of the undersigned with respect to the tendered Old Notes, with full power of substitution (such power of attorney being deemed to be an irrevocable power coupled with an interest), to (i) deliver the tendered Old Notes to the Company or cause ownership of the tendered Old Notes to be transferred to, or upon the order of, the Company, on the books of the registrar for the Old Notes and deliver all accompanying evidences of transfer and authenticity to, or upon the order of, the Company upon receipt by the Exchange Agent, as the undersigned's agent, of the New Notes to which the undersigned is entitled upon acceptance by the Company of the tendered Old Notes pursuant to the Exchange Offer, (ii) receive all benefits and otherwise exercise all rights of beneficial ownership of the tendered Old Notes, all in accordance with the terms of the Exchange Offer, and (iii) receive payment of the Participation Fee from the Company and transmit payment to the Holders. The undersigned understands that tenders of Old Notes pursuant to the procedures described under the caption "The Exchange Offer--Procedures for Tendering Old Notes" in the Offering Circular and in the instructions hereto will constitute a binding agreement between the undersigned and the Company upon the terms and subject to the conditions of the Exchange Offer, subject only to withdrawal of such tenders on the terms set forth in the Offering Circular under the caption "The Exchange Offer--Withdrawal Rights." All authority herein conferred or agreed to be conferred shall survive the death or incapacity of the undersigned and any Beneficial Owner(s), and every obligation of the undersigned or any Beneficial Owner(s) hereunder shall be binding upon the heirs, representatives, successors, and assigns of the undersigned and such Beneficial Owner(s). The undersigned hereby represents and warrants that the undersigned has full power and authority to tender, exchange, assign, and transfer the tendered Old Notes and that the Company will acquire good and unencumbered title thereto, free and clear of all liens, restrictions, charges, encumbrances, and adverse claims when the tendered Old Notes are acquired by the Company as contemplated herein. The undersigned and each Beneficial Owner will, upon request, execute and deliver any additional documents reasonably requested by the Company or the Exchange Agent as necessary or desirable to complete and give effect to the transactions contemplated hereby. The undersigned hereby represents and warrants that the information set forth in Box 1 is true and correct. 2 Holders of Old Notes that are tendering their Old Notes by book-entry transfer to the Exchange Agent's account at DTC can execute the tender through the DTC Automated Tender Offer Program ("ATOP"), for which the transaction will be eligible. DTC participants that are accepting the Exchange Offer must transmit their acceptance to DTC, which will verify the acceptance and execute a book- entry delivery to the Exchange Agent's DTC account. DTC will then send an Agent's Message to the Exchange Agent for its acceptance. DTC participants may also accept the Exchange Offer prior to the Expiration Date by submitting a Notice of Guaranteed Delivery through ATOP. [ ] CHECK HERE IF OLD NOTES ARE BEING DELIVERED BY BOOK-ENTRY TRANSFER MADE TO THE ACCOUNT MAINTAINED BY THE EXCHANGE AGENT WITH THE BOOK-ENTRY TRANSFER FACILITY AND COMPLETE "USE OF BOOK-ENTRY TRANSFER" BELOW (Box 4). [ ] CHECK HERE IF OLD NOTES ARE BEING DELIVERED PURSUANT TO A NOTICE OF GUARANTEED DELIVERY PREVIOUSLY DELIVERED TO THE EXCHANGE AGENT AND COMPLETE "USE OF GUARANTEED DELIVERY" BELOW (Box 3). [ ] CHECK HERE IF OLD NOTES ARE BEING DELIVERED HEREWITH. 3 PLEASE READ THIS ENTIRE LETTER OF TRANSMITTAL CAREFULLY BEFORE COMPLETING THE BOXES
- ----------------------------------------------------------------------------------------------------- BOX 1 DESCRIPTION OF OLD NOTES TENDERED (ATTACH ADDITIONAL SIGNED PAGES, IF NECESSARY) - ----------------------------------------------------------------------------------------------------- AGGREGATE PRINCIPAL AGGREGATE NAME(S) AND ADDRESS(ES) OF REGISTERED HOLDER(S), CERTIFICATE AMOUNT PRINCIPAL EXACTLY AS NAME(S) APPEAR(S) ON OLD NOTE NUMBER(S) OF REPRESENTED BY AMOUNT CERTIFICATE(S) OLD NOTES* CERTIFICATE(S) TENDERED** (PLEASE FILL IN, IF BLANK) - ----------------------------------------------------------------------------------------------------- -------------------- -------------------- -------------------- -------------------- -------------------- - -------------------------------------------------- -------------------- TOTAL - ----------------------------------------------------------------------------------------------------- * NEED NOT BE COMPLETED BY PERSONS TENDERING BY BOOK-ENTRY TRANSFER. ** THE MINIMUM PERMITTED TENDER IS $1,000 IN PRINCIPAL AMOUNT OF OLD NOTES. ALL OTHER TENDERS MUST BE IN INTEGRAL MULTIPLES OF $1,000 OF PRINCIPAL AMOUNT. UNLESS OTHERWISE INDICATED IN THIS COLUMN, THE PRINCIPAL AMOUNT OF ALL OLD NOTES IDENTIFIED IN THIS BOX 1 OR DELIVERED TO THE EXCHANGE AGENT HEREWITH SHALL BE DEEMED TENDERED. SEE INSTRUCTION 4. - ------------------------------------------------------------------------------------------------------
4 - ----------------------------------------------------------------------------- BOX 2 SPECIAL DELIVERY INSTRUCTIONS (SEE INSTRUCTIONS 5, 6 AND 7) TO BE COMPLETED ONLY IF NEW NOTES EXCHANGED FOR OLD NOTES AND UNTENDERED OLD NOTES AND/OR THE CHECK FOR PAYMENT OF THE PARTICIPATION FEE ARE TO BE SENT TO SOMEONE OTHER THAN THE UNDERSIGNED, OR TO THE UNDERSIGNED AT AN ADDRESS OTHER THAN THAT SHOWN ABOVE. MAIL: [ ] NEW NOTE(S) AND ANY OLD NOTES NOT TENDERED HEREBY TO: [ ] CHECK TO: NAME(S): - ----------------------------------------------------------------------------- (PLEASE PRINT) ADDRESS: - ----------------------------------------------------------------------------- - ----------------------------------------------------------------------------- - ----------------------------------------------------------------------------- (INCLUDE ZIP CODE) TAX IDENTIFICATION OR SOCIAL SECURITY NO.: - ----------------------------------------------------------------------------- - ----------------------------------------------------------------------------- 5 - ----------------------------------------------------------------------------- BOX 3 USE OF GUARANTEED DELIVERY (SEE INSTRUCTION 2) TO BE COMPLETED ONLY IF OLD NOTES ARE BEING TENDERED BY MEANS OF A NOTICE OF GUARANTEED DELIVERY. NAME(S) OF HOLDER(S):--------------------------------------------------------- WINDOW TICKET NO. (IF ANY):--------------------------------------------------- DATE OF EXECUTION OF NOTICE OF GUARANTEED DELIVERY:--------------------------- NAME OF ELIGIBLE INSTITUTION THAT GUARANTEED DELIVERY:------------------------ IF DELIVERED BY BOOK-ENTRY TRANSFER, COMPLETE THE FOLLOWING: DTC ACCOUNT NUMBER:--------------------------------------------------- VOI NUMBER:----------------------------------------------------------- - ------------------------------------------------------------------------------- BOX 4 USE OF BOOK-ENTRY TRANSFER (SEE INSTRUCTION 1) TO BE COMPLETED ONLY IF DELIVERY OF OLD NOTES IS TO BE MADE BY BOOK-ENTRY TRANSFER. NAME OF TENDERING INSTITUTION:-------------------------------------------------- ACCOUNT NUMBER:----------------------------------------------------------------- VOI NUMBER:--------------------------------------------------------------------- - -------------------------------------------------------------------------------- 6
- -------------------------------------------------------------------------------------------------------------------- BOX 5 TENDERING HOLDER SIGNATURE (SEE INSTRUCTIONS 1 AND 5) IN ADDITION, COMPLETE SUBSTITUTE FORM W-9 - -------------------------------------------------------------------------------------------------------------------- X -------------------------------------------- SIGNATURE GUARANTEE (IF REQUIRED BY INSTRUCTION 5) X -------------------------------------------- (SIGNATURE OF HOLDER(S) AUTHORIZED SIGNATURE OR AUTHORIZED SIGNATORY) X------------------------------------------------------ NOTE: THE ABOVE LINES MUST BE SIGNED BY THE REGISTERED HOLDER(S) OF OLD NOTES AS THEIR NAME(S) NAME:-------------------------------------------------- APPEAR(S) THEREIN OR BY PERSON(S) AUTHORIZED TO (PLEASE PRINT) BECOME REGISTERED HOLDER(S) (EVIDENCE OF SUCH AUTHORIZATION MUST BE TRANSMITTED WITH THIS LETTER TITLE:------------------------------------------------- OF TRANSMITTAL). IF SIGNATURE IS BY A TRUSTEE, EXECUTOR, ADMINISTRATOR, GUARDIAN, ATTORNEY-IN-FACT, NAME OF FIRM:------------------------------------------ OFFICER, OR OTHER PERSON ACTING IN A FIDUCIARY OR (MUST BE AN ELIGIBLE INSTITUTION REPRESENTATIVE CAPACITY, SUCH PERSON MUST SET FORTH AS DEFINED IN INSTRUCTION 2) HIS OR HER FULL TITLE BELOW. SEE INSTRUCTION 5 NAME(S): ----------------------------------- ADDRESS: ---------------------------------------------- CAPACITY:----------------------------------- ---------------------------------------------- ADDRESS: ----------------------------------- ---------------------------------------------- (ZIP CODE) ----------------------------------- (ZIP CODE) AREA CODE AND TELEPHONE NUMBER:------------------------ AREA CODE AND TELEPHONE NUMBER:------------- DATED:------------------------------------------------- TAX IDENTIFICATION OR SOCIAL SECURITY NUMBER: ----------------------------------- - ------------------------------------------------------ -----------------------------------------------------
7 PAYORS NAME: IBJ SCHRODER BANK & TRUST COMPANY --------------------------------- - ------------------------------------------------------------------------------------------------------------------------ NAME: (If joint names, list first and circle the name of the person or SUBSTITUTE entity whose number you enter in Part 1 below. See instructions if your name has changed. FORM W-9 DEPARTMENT OF THE ------------------------------------------------------------------------------------------- TREASURY INTERNAL REVENUE SERVICE ADDRESS:----------------------------------------------------------------------------------- ------------------------------------------------------------------------------------------- PAYER'S REQUEST FOR TAXPAYER CITY, STATE AND ZIP CODE:------------------------------------------------------------------ IDENTIFICATION NUMBER (TIN) ------------------------------------------------------------------------------------------- LIST ACCOUNT NUMBER(S) (OPTIONAL):--------------------------------------------------------- ------------------------------------------------------------------------------------------- PART 1--PLEASE PROVIDE YOUR TAXPAYER IDENTIFICATION NUMBER IN THE BOX AT ------------------------------ RIGHT AND CERTIFY BY SIGNING AND Social Security Number DATING BELOW OR ------------------------------ Taxpayer Identification Number ------------------------------------------------------------------------------------------- PART 2--Check the box if you are NOT PART 3-- subject to backup withholding under the provisions of section Awaiting TIN [ ] 3406(a)(1)(C) of the Internal Revenue Code because (1) you have not been notified that you are subject to backup withholding as a result of failure to report all interest or dividends or (2) the Internal Revenue Service has notified you that you are no longer subject to backup withholding. [ ] - ----------------------------------------------------------------------------------------------------------------------- CERTIFICATION--UNDER THE PENALTIES OF PERJURY, I CERTIFY THAT THE INFORMATION PROVIDED ON THIS FORM IS TRUE, CORRECT AND COMPLETE. SIGNATURE----------------------------------- DATE----------------------------------------- NAME (Please Print) - ----------------------------------------------------------------------------------------------------------------------- NOTE: FAILURE TO COMPLETE AND RETURN THIS FORM MAY RESULT IN BACKUP WITHHOLDING OF 31% OF ANY PAYMENTS MADE TO YOU PURSUANT TO THE EXCHANGE OFFER. PLEASE REVIEW THE ENCLOSED GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION NUMBER ON SUBSTITUTE FORM W-9 FOR ADDITIONAL DETAILS. YOU MUST COMPLETE THE FOLLOWING CERTIFICATE IF YOU CHECKED THE BOX IN PART 3 OF THE SUBSTITUTE FORM W-9. CERTIFICATE OF AWAITING TAXPAYER IDENTIFICATION NUMBER I certify under penalties of perjury that a taxpayer identification number has not been issued to me, and either (a) I have mailed or delivered an application to receive a taxpayer identification number to the appropriate Internal Revenue Service Center or Social Security Administration Office or (b) I intend to mail or deliver an application in the near future. I understand that, if I do not provide a taxpayer identification number to the exchange agent, 31% of all reportable payments made to me will be withheld, but will be refunded if I provide a certified taxpayer identification number within 60 days. ------------------------------------------------- -------------------------------------------------- Signature Date -------------------------------------------------- Name (Please Print) --------------------------------------------------------------------------------------------------------------------
INSTRUCTIONS TO LETTER OF TRANSMITTAL Forming Part of the Terms and Conditions of the Exchange Offer 1. DELIVERY OF THIS LETTER OF TRANSMITTAL AND OLD NOTES. This Letter of Transmittal is to be completed by Holders of tendered Old Notes if certificates representing such tendered Old Notes are to be forwarded herewith pursuant to the procedures set forth in the Offering Circular under "The Exchange Offer-- Procedures for Tendering Old Notes," unless delivery of such certificates is to be made by book-entry transfer to the Exchange Agent's account maintained by DTC through ATOP. For a Holder to properly tender Old Notes pursuant to the Exchange Offer, a properly completed and duly executed copy of this Letter of Transmittal, including the Substitute Form W-9, and any other documents required by this Letter of Transmittal must be received by the Exchange Agent at its address set forth herein, and either (i) certificates for tendered Old Notes must be received by the Exchange Agent at its address set forth herein, or (ii) such tendered Old Notes must be transferred pursuant to the procedures for book- entry transfer described in the Offering Circular under the caption "The Exchange Offer--Procedures for Tendering" (and a confirmation of such transfer received by the Exchange Agent) in each case prior to Expiration Date. The method of delivery of certificates for tendered Old Notes, this Letter of Transmittal and all other required documents to the Exchange Agent is at the election and risk of the tendering holder and the delivery will be deemed made only when actually received by the Exchange Agent. If delivery is by mail, registered mail with return receipt requested, properly insured, is recommended. Instead of delivery by mail, it is recommended that the Holder use an overnight or hand delivery service. In all cases, sufficient time should be allowed to assure timely delivery. No Letter of Transmittal or tendered Old Notes should be sent to the Company. Neither the Company nor the Exchange Agent is under any obligation to notify any tendering holder of the Company's acceptance of tendered Old Notes prior to the closing of the Exchange Offer. 2. GUARANTEED DELIVERY PROCEDURES. If a Holder desires to tender Old Notes pursuant to the Exchange Offer and (a) certificates representing such tendered Old Notes are not immediately available, (b) time will not permit such Holder(s) Letter of Transmittal, certificates representing such tendered Old Notes and all other required documents to reach the Exchange Agent on or prior to the Expiration Date, or (c) the procedures for book-entry transfer cannot be completed on or prior to the Expiration Date, such Holder may tender Old Notes with the effect that such tender will be deemed to have been received on or prior to the Expiration Date if the procedures set forth below and in the Offering Circular under "The Exchange Offer--Guaranteed Delivery Procedures" (including the completion of Box 3 above) are followed. Pursuant to such procedures, (i) the tender must be made by or through an Eligible Institution (as defined), (ii) a properly completed and duly executed Notice of Guaranteed Delivery, substantially in the form provided by the Company herewith, or an Agent's Message with respect to a guaranteed delivery that is accepted by the Company, must be received by the Exchange Agent on or prior to the Expiration Date, and (iii) the certificates for the tendered Old Notes, in proper form for transfer (or a Book-Entry Confirmation of the transfer of such tendered Old Notes to the Exchange Agent's account at DTC as described in the Offering Circular), together with a Letter of Transmittal (or manually signed facsimile thereof) properly completed and duly executed, with any required signature guarantees and any other documents required by the Letter of Transmittal or a properly transmitted Agent's Message, must be received by the Exchange Agent within three New York Stock Exchange trading days after the date of execution of the Notice of Guaranteed Delivery. Any Holder who wishes to tender Old Notes pursuant to the guaranteed delivery procedures described above must ensure that the Exchange Agent receives the Notice of Guaranteed Delivery relating to such tendered Old Notes prior to the Expiration Date. Failure to complete the guaranteed delivery procedures outlined above will not, of itself, affect the validity or effect a revocation of any Letter of Transmittal form properly completed and executed by an Eligible Holder who attempted to use the guaranteed delivery process. 3. BENEFICIAL OWNER INSTRUCTIONS TO HOLDERS. Only a Holder in whose name Old Notes are registered on the books of the registrar (or the legal representative or attorney-in-fact of such registered holder) may execute and deliver this Letter of Transmittal. Any Beneficial Owner of Old Notes who is not the Holder must arrange promptly with the Holder to execute and deliver this Letter of Transmittal on his or her behalf. 4. PARTIAL TENDERS. Tenders of Old Notes will be accepted only in integral multiples of $1,000 in principal amount. If less than the entire principal amount of Old Notes held by the Holder is tendered, the Holder should fill in the principal amount tendered in the column labeled "Aggregate Principal Amount Tendered" of the box entitled "Description of Notes Tendered" (see Box 1) above. The entire principal amount of Old Notes delivered to the Exchange Agent will be deemed to have been tendered unless otherwise indicated. If the entire principal amount of all Old Notes held by the Holder is not tendered, then new certificates representing the Old Notes for the principal amount of Old Notes not tendered and New Notes issued in exchange for any Old Notes tendered and accepted will be sent to the Holder at its registered address, unless a different address is provided in the box entitled "Special Delivery Instructions" on this Letter of Transmittal, as soon as practicable following the Expiration Date. 2 5. SIGNATURES ON THE LETTER OF TRANSMITTAL; BOND POWERS AND ENDORSEMENTS; GUARANTEE OF SIGNATURES. If this Letter of Transmittal is signed by the Holder(s) of the tendered Old Notes, the signature must correspond with the name(s) as written on the face of the tendered Old Notes without alteration, enlargement or any change whatsoever. If any of the tendered Old Notes are owned of record by two or more joint owners, all such owners must sign this Letter of Transmittal. If any tendered Old Notes are held in different names, it will be necessary to complete, sign and submit as many separate copies of the Letter of Transmittal as there are different names in which such tendered Old Notes are held. If this Letter of Transmittal is signed by the Holder(s) of Old Notes, and New Notes issued in exchange therefor are to be issued (and any untendered principal amount of Old Notes is to be reissued) in the name of the Holder(s), then such Holder(s) need not and should not endorse any Old Notes, nor provide a separate bond power. In any other case, such Holder(s) must either properly endorse the tendered Old Notes or transmit a properly completed separate bond power with this Letter of Transmittal with the signature(s) on the endorsement or bond power guaranteed by a Medallion Signature Guarantor (as defined below). If this Letter of Transmittal is signed by a person other than the Holder(s) of any tendered Old Notes, such tendered Old Notes must be endorsed or accompanied by appropriate bond powers, in each case, signed as the name(s) of the Holder(s) appear(s) on the tendered Old Notes, with the signature(s) on the endorsement or bond power guaranteed by a Medallion Signature Guarantor. If this Letter of Transmittal or any tendered Old Notes or bond powers are signed by trustees, executors, administrators, guardians, attorney-in-fact, officers of corporations, or others acting in a fiduciary or representative capacity, such persons should so indicate when signing and, unless waived by the Company, evidence satisfactory to the Company of their authority to so act must be submitted with this Letter of Transmittal. Signatures on this Letter of Transmittal must be guaranteed by a recognized participant in the Securities Transfer Agents Medallion Program, the New York Stock Exchange Medallion Signature Program or the Stock Exchange Medallion Program (each a "Medallion Signature Guarantor"), unless the Old Notes are tendered (i) by the Holder of the Old Notes (or by a participant in DTC whose name appears on a security position listing as the owner of such Old Notes) who has not completed Box 2 ("Special Delivery Instructions") on this Letter of Transmittal, or (ii) for the account of a member firm of a registered national securities exchange, a member of the National Association of Securities Dealers, Inc. ("NASD") or a commercial bank or trust company having an office or correspondent in the United States (each of the foregoing being referred to as an "Eligible Institution"). If the tendered Old Notes are registered in the name of a person other than the signer of the Letter of Transmittal or if Old Notes not tendered are to be returned to a person other than the Holder, then the signature on this Letter of Transmittal accompanying the tendered Old Notes must be guaranteed by a Medallion Signature Guarantor as described above. Beneficial Owners whose tendered Old Notes are registered in the name of a broker, dealer, commercial bank, trust company or other nominee must contact such broker, dealer, commercial bank, trust company or other nominee if they desire to tender such Old Notes. 6. SPECIAL DELIVERY INSTRUCTIONS. Holders should indicate in Box 2 ("Special Delivery Instructions") the name and address to which the New Notes and/or substitute Old Notes for principal amounts not tendered or not accepted for exchange, and/or payment of the Participation Fee, are to be sent, if different from the name and address of the person signing this Letter of Transmittal. In the case of issuance in a different name, the taxpayer identification or social security number of the person named must also be indicated. 7. TRANSFER TAXES. The Company will pay all transfer taxes, if any, applicable to the exchange of Old Notes pursuant to the Exchange Offer. If, however, a transfer tax is imposed for any reason other than the transfer and exchange of Old Notes pursuant to the Exchange Offer, then the amount of any such transfer taxes (whether imposed on the Holder or on any other person) will be payable by the Holder. If satisfactory evidence of payment of such taxes or exemption therefrom is not submitted with this Letter of Transmittal, the amount of such transfer taxes will be billed directly to such Holder. It will not be necessary for transfer tax stamps to be affixed to the tendered Old Notes listed in this Letter of Transmittal. 8. TAX IDENTIFICATION NUMBER. Federal income tax law requires that the Holder(s) of any Old Notes which are accepted for exchange must provide the Exchange Agent (as payor) with its correct taxpayer identification number ("TIN"), which, in the case of a Holder who is an individual, is his or her social security number. If the Exchange 3 Agent is not provided with the correct TIN, the Holder may be subject to backup withholding and a $50 penalty imposed by the Internal Revenue Service ("IRS"). (If withholding results in an over-payment of taxes, a refund may be obtained.) Certain Holders (including, among others, all corporations and certain foreign individuals) are not subject to these backup withholding and reporting requirements. See the enclosed "Guidelines for Certification of Taxpayer Identification Number on Substitute Form W-9" for additional instructions. To prevent backup withholding, each Holder of tendered Old Notes must provide such Holder's correct TIN by completing the Substitute Form W-9 set forth herein, certifying that the TIN provided is correct (or that such Holder is awaiting a TIN), and that (i) the Holder has not been notified by the IRS that such Holder is subject to backup withholding as a result of failure to report all interest or dividends or (ii) if previously so notified, the IRS has notified the Holder that such Holder is no longer subject to backup withholding. If the tendered Old Notes are registered in more than one name or are not in the name of the actual owner, consult the "Guidelines for Certification of Taxpayer Identification Number on Substitute Form W-9" for information on which TIN to report. The Company reserves the right in its sole discretion to take whatever steps are necessary to comply with the Company's obligation regarding backup withholding. 9. VALIDITY OF TENDERS. All questions as to the validity, form, eligibility (including time of receipt), acceptance and withdrawal of tendered Old Notes will be determined by the Company in its sole discretion, which determination will be final and binding. The Company reserves the right to reject any and all Old Notes not validly tendered or any Old Notes the Company's acceptance of which would, in the opinion of the Company or its counsel, be unlawful. The Company also reserves the right to waive any conditions of the Exchange Offer or defects or irregularities in tenders of Old Notes as to any ineligibility of any Holder who seeks to tender Old Notes in the Exchange Offer. The interpretation of the terms and conditions of the Exchange Offer (including this Letter of Transmittal and the instructions hereto) by the Company shall be final and binding on all parties. Unless waived, any defects or irregularities in connection with tenders of Old Notes must be cured within such time as the Company shall determine. Neither the Company, the Exchange Agent nor any other person shall be under any duty to give notification of defects or irregularities with respect to tenders of Old Notes, nor shall any of them incur any liability for failure to give such notification. Tenders of Old Notes will not be deemed to have been made until such defects or irregularities have been cured or waived. Any Old Notes received by the Exchange Agent that are not properly tendered and as to which the defects or irregularities have not been cured or waived will be returned by the Exchange Agent to the Holders, unless otherwise provided in this Letter of Transmittal, as soon as practicable following the Expiration Date. 10. WAIVER OF CONDITIONS. The Company reserves the absolute right to amend, waive or modify any of the conditions in the Exchange Offer in the case of any Old Notes. 11. NO CONDITIONAL TENDER. No alternative, conditional, irregular, or contingent tender of Old Notes or transmittal of this Letter of Transmittal will be accepted. 12. MUTILATED, LOST, STOLEN OR DESTROYED NOTES. Any Holder whose tendered Old Notes have been mutilated, lost, stolen or destroyed should contact the Exchange Agent at the address indicated herein for further instructions. 13. REQUESTS FOR ASSISTANCE OR ADDITIONAL COPIES. Questions and requests for assistance and requests for additional copies of the Offering Circular or this Letter of Transmittal may be directed to the Exchange Agent or the Information Agent at the addresses and telephone numbers indicated herein. Holders may also contact their broker, dealer, commercial bank, trust company or other nominee for assistance concerning the Exchange Offer. 14. ACCEPTANCE OF TENDERED NOTES AND ISSUANCE OF EXCHANGE NOTES; RETURN OF NOTES. Subject to the terms and conditions of the Exchange Offer, the Company will accept for exchange all validly tendered Old Notes as soon as practicable after the Expiration Date and will issue New Notes therefor, along with payment of the Participation Fee, on the fifth business day following the Expiration Date. For purposes of the Exchange Offer, the Company shall be deemed to have accepted tendered Old Notes when, as and if the Company has given written or oral notice (immediately followed in writing) thereof to the Exchange Agent. If any tendered Old Notes are not exchanged pursuant to the Exchange Offer for any reason, such unexchanged Old Notes will be returned, without expense, to the undersigned at the address shown in Box l or at a different address as may be indicated herein under "Special Delivery Instructions" (Box 2). 15. WITHDRAWAL. Tenders may be withdrawn only pursuant to the procedures set forth in the Offering Circular under the caption "The Exchange Offer--Withdrawal Rights." 4 EX-99.T3E.3 4 FORM OF NOTICE OF GUARANTEED DELIVERY EXHIBIT T3E.3 NOTICE OF GUARANTEED DELIVERY IN RESPECT OF OFFER TO EXCHANGE NOTES DUE 2033 FOR ANY AND ALL OF THE OUTSTANDING 8.30% NOTES DUE 2023 OF CIGNA CORPORATION PURSUANT TO THE OFFERING CIRCULAR DATED JUNE 24, 1998 - -------------------------------------------------------------------------------- THE EXCHANGE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON THURSDAY, JULY 23, 1998, UNLESS EXTENDED ("THE EXPIRATION DATE"). - -------------------------------------------------------------------------------- The Exchange Agent for the Exchange Offer is: IBJ SCHRODER BANK & TRUST COMPANY By Facsimile: By Mail: (212) 858-2611 By Hand or Overnight Delivery: P.O. Box 84 One State Street Bowling Green Station New York, New York 10004 New York, New York 10274-0084 Attn: Securities Processing Attn: Reorganization Operations Window, Subcellar One (SC-1) Department Confirm by Telephone: (212) 858-2103 DELIVERY OF THIS NOTICE OF GUARANTEED DELIVERY TO AN ADDRESS, OR TRANSMISSION VIA FACSIMILE TO A NUMBER, OTHER THAN AS SET FORTH ABOVE WILL NOT CONSTITUTE VALID DELIVERY. As set forth in the Offering Circular dated June 24, 1998 (as it may be supplemented and amended from time to time, the "Offering Circular") of CIGNA Corporation (the "Company") under "The Exchange Offer--Guaranteed Delivery Procedures," and in the Instructions to the related Letter of Transmittal (the "Letter of Transmittal"), this form, or one substantially equivalent hereto, or an Agent's Message relating to the guaranteed delivery procedures, must be used to accept the Company's offer (the "Exchange Offer") to exchange an aggregate principal amount of up to $100,000,000 of its Notes Due 2033 (the "New Notes") for a like amount of its issued and outstanding 8.30% Notes Due 2023 (the "Old Notes"), if time will not permit the Letter of Transmittal to reach the Exchange Agent, or the procedures for book-entry transfer cannot be completed, on or prior to the Expiration Date (as defined herein). This form must be delivered by an Eligible Institution (as defined herein) by facsimile transmission, mail or hand delivery to the Exchange Agent as set forth above. If a signature on the Letter of Transmittal is required to be guaranteed by a Medallion Signature Guarantor under the instructions thereto, such signature guarantee must appear in the applicable space provided in the Letter of Transmittal. This form is not to be used to guarantee signatures. Questions and requests for additional copies of the Offering Circular may be directed to the Exchange Agent at the address above. Beneficial owners may also contact their broker, dealer, commercial bank, trust company, or other nominee for assistance concerning the Exchange Offer. LADIES AND GENTLEMEN: The undersigned hereby tender(s) to the Company, upon the terms and subject to the conditions set forth in the Offering Circular and the Letter of Transmittal (receipt of which is hereby acknowledged), the principal amount of the Old Notes specified below pursuant to the guaranteed delivery procedures set forth in the Offering Circular under "The Exchange Offer--Guaranteed Delivery Procedures" and in Instruction 2 to the Letter of Transmittal. The undersigned hereby authorizes the Exchange Agent to deliver this Notice of Guaranteed Delivery to the Company with respect to the Old Notes tendered pursuant to the Exchange Offer. The undersigned understands that Old Notes will be exchanged only after timely receipt by the Exchange Agent of (i) such Old Notes, or a Book- Entry Confirmation, and (ii) a Letter of Transmittal (or a manually signed facsimile thereof), including by means of an Agent's Message, of the transfer of such Old Notes into the Exchange Agent's account at the Book-Entry Transfer Facility, with respect to such Old Notes, properly completed and duly executed, with any signature guarantees and any other documents required by the Letter of Transmittal within three New York Stock Exchange trading days after the execution hereof. The undersigned also understands that the method of delivery of this Notice of Guaranteed Delivery and any other required documents to the Exchange Agent is at the election and sole risk of the Holder, and the delivery will be deemed made only when actually received by the Exchange Agent. THE UNDERSIGNED UNDERSTANDS THAT TENDERS OF OLD NOTES WILL BE ACCEPTED ONLY IN DENOMINATIONS OF $1,000 OR AN INTEGRAL MULTIPLE THEREOF. THE UNDERSIGNED ALSO UNDERSTANDS THAT TENDERS OF OLD NOTES MAY BE WITHDRAWN AT ANY TIME PRIOR TO THE EXPIRATION DATE. All authority conferred or agreed to be conferred by this Notice of Guaranteed Delivery shall not be affected by, and shall survive, the death or incapacity of the undersigned, and every obligation of the undersigned under this Notice of Guaranteed Delivery shall be binding upon the heirs, executors, administrators, trustees in bankruptcy, personal and legal representatives, successors and assigns of the undersigned. All capitalized terms used herein but not defined herein shall have the meanings ascribed to them in the Offering Circular. 2 PLEASE SIGN AND COMPLETE ________________________________________ ____________________________________________ Signature(s) of Holder(s) or Authorized Date: ______________________________________ Signatory:______________________________ Address:____________________________________ ________________________________________ ____________________________________________ ________________________________________ Area Code and Telephone No.: _______________ Name(s) of Holder(s): __________________ ____________________________________________ ________________________________________ If Notes will be delivered by book-entry ________________________________________ transfer, check book-entry transfer facility below: Principal Amount of Old Notes Tendered:_______________________________ The Depository Trust Company ________________________________________ DTC No. ____________________________________ Account No. ________________________________ Certificate No.(s) of Old Notes (if available): ________________________ ________________________________________ ____________________________________________
- -------------------------------------------------------------------------------- This Notice of Guaranteed Delivery must be signed by the Holder(s) exactly as their name(s) appear(s) on certificate(s) for Old Notes or on a security position listing as the owner of Old Notes, or by person(s) authorized to become Holder(s) by endorsements and documents transmitted with this Notice of Guaranteed Delivery without alteration, enlargement or any change whatsoever. If signature is by a trustee, executor, administrator, guardian, attorney-in- fact, officer or other person acting in a fiduciary or representative capacity, such person must provide the following information. Please print name(s) and address(es) Name(s): ___________________________________________________________ ___________________________________________________________________ Capacity: __________________________________________________________ Address(es): _______________________________________________________ ___________________________________________________________________ ___________________________________________________________________ - -------------------------------------------------------------------------------- DO NOT SEND OLD NOTES WITH THIS FORM. OLD NOTES SHOULD BE SENT TO THE EXCHANGE AGENT WITH A PROPERLY COMPLETED AND DULY EXECUTED LETTER OF TRANSMITTAL. 3 ================================================================================ GUARANTEE (NOT TO BE USED FOR SIGNATURE GUARANTEE) The undersigned, a member of the Securities Transfer Agents Medallion Program, the Stock Exchange Medallion Program or the New York Stock Exchange, Inc. Medallion Signature Program (each, an "Eligible Institution"), hereby guarantees that the Notes tendered hereby are in proper form for transfer (pursuant to the procedures set forth in the Offering Circular under "The Exchange Offer-- Guaranteed Delivery Procedures"), and that the Exchange Agent will receive (a) such Old Notes, or a timely confirmation of a book-entry transfer of such Notes to a Book-Entry Transfer Facility and (b) a properly completed and duly executed Letter of Transmittal or manually signed facsimile thereof (or Agent's message) with any required signature guarantees and any other documents required by the Letter of Transmittal within three New York Stock Exchange trading days after the date of execution hereof. The Eligible Institution that completes this form must communicate the guarantee to the Exchange Agent and must deliver the Letter of Transmittal and Notes to the Exchange Agent within the time period shown herein. Failure to do so could result in a financial loss to such Eligible Institution. Name of Firm: ____________________________________________________________ Authorized Signature: ____________________________________________________ Title: ___________________________________________________________________ Address: _________________________________________________________________ _________________________________________________________________________ (Zip Code) Area Code and Telephone Number: __________________________________________ Dated: _____________________________ ================================================================================ 4 EX-99.T3E.4 5 LETTER TO BENEFICIAL OWNERS EXHIBIT T3E.4 LETTER TO BENEFICIAL OWNERS CIGNA CORPORATION OFFER TO EXCHANGE NOTES DUE 2033 FOR ANY AND ALL OF ITS OUTSTANDING 8.30% NOTES DUE 2023 - ------------------------------------------------------------------------------- THE EXCHANGE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON THURSDAY, JULY 23, 1998, UNLESS EXTENDED (THE "EXPIRATION DATE''). - ------------------------------------------------------------------------------- June 24, 1998 To Our Clients: Enclosed for your consideration are the Offering Circular dated June 24, 1998 (the "Offering Circular") and the accompanying Letter of Transmittal (which together constitute the "Exchange Offer") in connection with the offer by CIGNA Corporation, a Delaware corporation (the "Company"), upon the terms and subject to the conditions set forth in the Offering Circular and the accompanying Letter of Transmittal to exchange an aggregate principal amount of up to $100,000,000 of its Notes Due 2033 (the "New Notes") for a like principal amount of its issued and outstanding 8.30% Notes Due 2023 (the "Old Notes") from the registered holders (individually, a "Holder" and collectively, the "Holders") thereof. The New Notes will evidence the same class of debt as the Old Notes and will be issued pursuant to, and entitled to the benefits of, an Indenture dated as of January 1, 1994, between the Company and Marine Midland Bank (formerly Marine Midland Bank, N.A.), the trustee. The New Notes will have the same 8.30% interest coupon as the Old Notes until, but not including, January 15, 2023. The interest coupon for the final 10 years of maturity will be calculated on the Extension Coupon Determination Date (as defined below) using a fixed spread pricing formula. For the Old Notes, a price (the "Reference Price of the Old Notes") will be determined using a specified fixed spread pricing formula. Such Reference Price of the Old Notes will be based on a yield to the maturity date of the Old Notes equal to (i) the yield on the 6.125% U.S. Treasury Note due November 15, 2027 (the "Benchmark Treasury Yield") plus (ii) 130 basis points. For the New Notes, a per annum interest coupon (the "Extension Coupon") will be determined for the period from January 15, 2023 to the maturity date, January 15, 2033. This Extension Coupon (expressed as a percentage with two decimal places) will be the lesser of: (i) 8.30% per annum and (ii) a per annum interest rate at which the price of the New Notes (the "Reference Price of the New Notes") will be equal to the Reference Price of the Old Notes per $1,000 principal amount thereof. The Extension Coupon of the New Notes will be determined by using the Reference Price of the New Notes (equal to the Reference Price of the Old Notes if the Benchmark Treasury Yield is 5.88% or lower) and a yield equal to the Benchmark Treasury Yield plus 140 basis points. For each $1,000 principal amount of Old Notes exchanged, the Holder thereof will receive $1,000 principal amount of New Notes. An amount will be payable upon acceptance of the Old Notes for exchange by the Company to any Holder who tenders, and does not withdraw, its Old Notes prior to the Expiration Date equal to 1.50% of the principal amount of the Old Notes exchanged in denominations of $1,000 or an integral multiple thereof. The Extension Coupon and the reference prices will be determined as of 2:00 p.m., New York City time, on the second business day prior to the Expiration Date (the "Extension Coupon Determination Date"). We are the Holder of Old Notes held for your account. A tender of such Old Notes can be made only by us as the Holder and pursuant to your instructions. The enclosed Letter of Transmittal is furnished to you for your information only and cannot be used by you to tender Old Notes held by us for your account. Beneficial owners of Old Notes whose Old Notes are held in the name of a broker, dealer, commercial bank, trust company or other nominee must contact such broker, dealer, commercial bank, trust company or other nominee if they desire to exchange such Old Notes. We request that you advise us whether you wish us to tender any or all of the Old Notes held by us for your account upon the terms and subject to the conditions set forth in the Offering Circular and the Letter of Transmittal. Your instructions to us should be forwarded as promptly as possible in order to permit us to execute a Letter of Transmittal and tender your Old Notes on your behalf in accordance with the terms of the Exchange Offer. Your attention is directed to the following: 1. The Exchange Offer and withdrawal rights will expire at 5:00 p.m., New York City time, on Thursday, July 23, 1998, unless extended. 2. The Company's obligation to exchange Old Notes for New Notes is subject to certain conditions set forth in the Offering Circular under the caption "The Exchange Offer--Conditions to the Exchange Offer." 3. Tenders of Old Notes may only be withdrawn prior to the Expiration Date. 4. Any transfer taxes with respect to the exchange and transfer of any Old Notes pursuant to the Exchange Offer will be paid by the Company, except as otherwise provided in Instruction 7 of the Letter of Transmittal. If you wish to have us tender any or all of your Old Notes, please so instruct us by completing, executing, detaching and returning to us the detachable instruction form set forth below. An envelope to return your instructions is enclosed. If you authorize the tender of your Old Notes, all such Old Notes will be tendered unless otherwise specified on such instructions. Your instruction should be forwarded to us in ample time to permit us to submit a tender on your behalf before the Expiration Date. The Exchange Offer is not being made to, and offers are not being solicited from (nor will tenders of Old Notes be accepted from or on behalf of), Holders in any jurisdiction in which the making of the Exchange Offer or acceptance for exchange of the Old Notes would not be in compliance with the laws of that jurisdiction. However, the Company may, in its sole discretion, take such action as it may deem necessary to make the Exchange Offer in any such jurisdiction, and may extend the Exchange Offer to Holders in that jurisdiction. IMPORTANT: THE LETTER OF TRANSMITTAL (OR A MANUALLY SIGNED FACSIMILE THEREOF), TOGETHER WITH THE OLD NOTES AND ALL OTHER REQUIRED DOCUMENTS MUST BE RECEIVED BY THE EXCHANGE AGENT PRIOR TO THE EXPIRATION DATE. 2 Instruction With Respect to the Exchange Offer The undersigned acknowledge(s) receipt of your letter, the Offering Circular dated June 24, 1998 and the related Letter of Transmittal relating to the Old Notes in connection with the Exchange Offer by the Company to exchange its New Notes for up to $100,000,000 of the Old Notes that are validly tendered and accepted for exchange, upon the terms and subject to the conditions set forth in the Offering Circular. Pursuant to the Exchange Offer, exchanges will be made on the basis of one Old Note for each New Note validly tendered and accepted for exchange in the Exchange Offer. This will instruct you to tender the number of Old Notes indicated below held by you for the account of the undersigned, upon the terms and subject to the conditions set forth in the Offering Circular and the Letter of Transmittal with respect to the Old Notes tendered. SIGN HERE - -------------------------------- ------------------------------------ Signature Signature (if more than one account holder) - -------------------------------- ------------------------------------ Name (Please Print) Name (Please Print) - -------------------------------- ------------------------------------ Address Telephone No. (including Area Code) - -------------------------------- Date: ------------------------------- City, State and Postal Code [ ] By checking this box, all Old Notes held by you for our account will be tendered in the Exchange Offer. If fewer than all Old Notes are to be tendered, we have checked the box below and indicated the aggregate number of Old Notes to be tendered by you. [ ] -------------------- Old Notes* - ----------------------------- * Unless otherwise indicated, it will be assumed that all such Old Notes are to be tendered. 3 EX-99.T3E.5 6 FORM OF LETTER TO DTC PARTICIPANTS EXHIBIT T3E.5 LETTER TO DTC PARTICIPANTS CIGNA CORPORATION OFFER TO EXCHANGE NOTES DUE 2033 FOR ANY AND ALL OF ITS OUTSTANDING 8.30% NOTES DUE 2023 - ------------------------------------------------------------------------------- THE EXCHANGE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON THURSDAY, JULY 23, 1998, UNLESS EXTENDED (THE "EXPIRATION DATE"). - ------------------------------------------------------------------------------- June 24, 1998 To DTC participants, including Brokers, Dealers, Commercial Banks, Trust Company and Other Nominees: CIGNA Corporation, a Delaware corporation (the "Company"), is offering upon the terms and subject to the conditions set forth in the Offering Circular dated June 24, 1998 (the "Offering Circular") and the accompanying Letter of Transmittal (which together constitute the "Exchange Offer") to exchange an aggregate principal amount of up to $100,000,000 of its Notes Due 2033 (the "New Notes") for a like principal amount of its issued and outstanding 8.30% Notes Due 2023 (the "Old Notes") from the registered holders (individually, a "Holder" and collectively, the "Holders") thereof. The New Notes will evidence the same class of debt as the Old Notes and will be issued pursuant to, and entitled to the benefits of, an Indenture dated as of January 1, 1994, between the Company and Marine Midland Bank (formerly Marine Midland Bank, N.A.), the trustee. The New Notes will have the same 8.30% interest coupon as the Old Notes until, but not including, January 15, 2023. The interest coupon for the final 10 years of maturity will be calculated on the Extension Coupon Determination Date (as defined below) using a fixed spread pricing formula. For the Old Notes, a price (the "Reference Price of the Old Notes") will be determined using a specified fixed spread pricing formula. Such Reference Price of the Old Notes will be based on a yield to the maturity date of the Old Notes equal to (i) the yield on the 6.125% U.S. Treasury Note due November 15, 2027 (the "Benchmark Treasury Yield") plus (ii) 130 basis points. For the New Notes, a per annum interest coupon (the "Extension Coupon") will be determined for the period from January 15, 2023 to the maturity date, January 15, 2033. This Extension Coupon (expressed as a percentage with two decimal places) will be the lesser of (i) 8.30% per annum and (ii) a per annum interest rate at which the price of the New Notes (the "Reference Price of the New Notes") will be equal to the Reference Price of the Old Notes per $1,000 principal amount thereof. The Extension Coupon of the New Notes will be determined by using the Reference Price of the New Notes (equal to the Reference Price of the Old Notes if the Benchmark Treasury Yield is 5.88% or lower) and a yield equal to the Benchmark Treasury Yield plus 140 basis points. For each $1,000 principal amount of Old Notes exchanged, the Holder thereof will receive $1,000 principal amount of New Notes. An amount will be payable upon acceptance of the Old Notes for exchange by the Company to any Holder who tenders, and does not withdraw, its Old Notes prior to the Expiration Date equal to 1.50% of the principal amount of Old Notes exchanged in denominations of $1,000 or an integral multiple thereof. The Extension Coupon and the reference prices will be determined as of 2:00 p.m., New York City time, on the second business day prior to the Expiration Date (the "Extension Coupon Determination Date"). Upon the terms and subject to the conditions of the Exchange Offer and applicable law, the Company will exchange all Old Notes validly tendered (and not withdrawn) pursuant to the Exchange Offer and accepted for exchange on the fifth New York Stock Exchange trading day following the Expiration Date, or as soon as possible thereafter (the "Settlement Date"). For your information and for forwarding to your clients for whom you hold Notes registered in your name or in the name of your nominee, we are enclosing the following documents: 1. Offering Circular; 2. The Letter of Transmittal to be used by each Holder of Old Notes to exchange Old Notes for New Notes; 3. A Notice of Guaranteed Delivery to be used to accept the Exchange Offer if Old Notes and all other required documents cannot be delivered to IBJ Schroder Bank & Trust Company (the "Exchange Agent") by the Expiration Date, or the book- entry transfer of such Old Notes cannot be completed by the Expiration Date; 4. A form of letter which may be sent to your clients for whose accounts you hold Old Notes in your name or in the name of your nominee with space provided for obtaining such clients' instructions with regard to the Exchange Offer; 5. A letter from the Company, regarding the Exchange Offer that may be sent to your clients; and 6. Guidelines for Certification of Taxpayer Identification Number on Substitute Form W-9. YOUR PROMPT ACTION IS REQUESTED. WE URGE YOU TO CONTACT YOUR CLIENTS PROMPTLY. PLEASE NOTE THAT THE EXCHANGE OFFER WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON THURSDAY, JULY 23, 1998, UNLESS EXTENDED. IMPORTANT: THE LETTER OF TRANSMITTAL (OR A MANUALLY SIGNED FACSIMILE THEREOF), TOGETHER WITH THE OLD NOTES AND ALL OTHER REQUIRED DOCUMENTS, MUST BE RECEIVED BY THE EXCHANGE AGENT PRIOR TO THE EXPIRATION DATE. In order to exchange Old Notes pursuant to the Exchange Offer, a duly executed and properly completed Letter of Transmittal and any required signature guarantees should be sent to the Exchange Agent, and certificates representing the tendered Old Notes (or confirmation of a book-entry transfer) should be delivered to the Exchange Agent, all in accordance with the instructions set forth in the Letter of Transmittal and the Offering Circular. The Company will, upon request, reimburse brokers, dealers, commercial banks, trust companies and other nominees for reasonable and customary mailing and handling expenses incurred by them in forwarding material to their customers. The Company will pay or cause to be paid all transfer taxes, if any, with respect to the transfer of any Old Notes to it pursuant to the Exchange Offer, except as otherwise provided in Instruction 7 of the Letter of Transmittal. Any inquiries you may have with respect to the Exchange Offer should be addressed to, and additional copies of the enclosed materials may be obtained from, MacKenzie Partners, Inc., the Information Agent, at the address and telephone number contained in the Offering Circular. In addition, Holders may contact Donaldson, Lufkin & Jenrette Securities Corporation, the financial advisor, at the address and telephone number contained in the Offering Circular. Very truly yours, CIGNA CORPORATION 2 NOTHING CONTAINED HEREIN OR IN THE ENCLOSED DOCUMENTS IS INTENDED TO CONSTITUTE YOU OR ANY PERSON THE AGENT OF THE COMPANY, IBJ SCHRODER BANK & TRUST COMPANY, OR MACKENZIE PARTNERS, INC. OR ANY OF THEIR RESPECTIVE AFFILIATES, OR AUTHORIZE YOU OR ANY OTHER PERSON TO MAKE ANY STATEMENT ON THEIR BEHALF OTHER THAN STATEMENTS EXPRESSLY MADE IN THE OFFERING CIRCULAR OR THE LETTER OF TRANSMITTAL OR USE ANY DOCUMENTS IN CONNECTION WITH THE EXCHANGE OFFER OTHER THAN FOR THE PURPOSES DESCRIBED HEREIN. 3 EX-99.T3E.6 7 FORM OF LETTER TO CLIENTS EXHIBIT T3E.6 DAVID B. GERGES, FSA, MAAA LOGO SENIOR VICE PRESIDENT AND TREASURER CIGNA CORPORATION One Liberty Place 1650 Market Street Philadelphia, PA 19192-1560 Facsimile 215.761.5521 June 24, 1998 Dear Noteholder: CIGNA Corporation (the "Company") is offering upon the terms and subject to the conditions set forth in the enclosed Offering Circular dated June 24, 1998 (the "Offering Circular") and the accompanying Letter of Transmittal (which together constitute the "Exchange Offer") to exchange an aggregate principal amount of up to $100,000,000 of its Notes Due 2033 (the "New Notes") for a like principal amount of its issued and outstanding 8.30% Notes Due 2023 (the "Old Notes") from the registered holders thereof. The New Notes will evidence the same class of debt as the Old Notes. The New Notes will have the same 8.30% interest coupon as the Old Notes until, but not including, January 15, 2023. The interest coupon for the final 10 years of maturity will be calculated using a fixed spread pricing formula described in the enclosed Offering Circular. Holders that tender and do not withdraw their Old Notes will receive upon acceptance of the Old Notes by the Company a participation fee equal to 1.50% of the principal amount tendered. The New Notes will also be subject to a "make-whole redemption" at the option of the Company as described in the Offering Circular. The Exchange Offer is explained in detail in the enclosed Offering Circular and the accompanying Letter of Transmittal. If you wish to participate in the Exchange Offer, the instructions on how to exchange your Old Notes are in the enclosed materials. I encourage you to carefully read these materials before making any decision with respect to the Exchange Offer. None of the Company, the Board of Directors of the Company, the Information Agent or the Exchange Agent makes any recommendation to Holders of the Old Notes as to whether to exchange or refrain from exchanging their Old Notes. In addition, no one has been authorized to make any such recommendation. Holders of Old Notes must make their own decision whether to exchange Old Notes pursuant to the Exchange Offer and, if so, the aggregate principal amount of Old Notes to exchange. Holders of the Old Notes may obtain additional copies of the Offering Circular by contacting MacKenzie Partners, Inc., the Information Agent, at (800) 322-2885 or (212) 929-5500. Holders of the Old Notes may obtain information regarding the terms of the Exchange Offer by contacting Donaldson, Lufkin & Jenrette Securities Corporation, the financial advisor, at (800) 334-1604 (toll free) or (212) 892-3351 (call collect), attention: Paul S. Galant. Very truly yours, /s/ David B. Gerges ---------------------- David B. Gerges Senior Vice President and Treasurer EX-99.T3F 8 CROSS REFERENCE SHEET EXHIBIT T3F Exhibit T3F -- Cross Reference Sheet CIGNA CORPORATION CERTAIN SECTION OF THE INDENTURE RELATING TO SECTIONS 310 THROUGH 318, INCLUSIVE, OF THE TRUST INDENTURE ACT OF 1939:
TRUST INDENTURE ACT SECTION INDENTURE SECTION (S)310(a)(1) .............................. 609 (a)(2) .............................. 609 (a)(3) .............................. Not Applicable (a)(4) .............................. Not Applicable (b) .............................. 608 610 (S)311(a) .............................. 613 (b) .............................. 613 (S)312(a) .............................. 701 702(a) (b) .............................. 702(b) (c) .............................. 702(c) (S)313(a) .............................. 703(a) (b) .............................. 703(b) (c) .............................. 703(a) (d) .............................. 703(b) (S)314(a) .............................. 704 (a)(4) .............................. 101 (b) .............................. Not Applicable (c)(1) .............................. 102 (c)(2) .............................. 102 (c)(3) .............................. Not Applicable (d) .............................. Not Applicable (e) .............................. 102 (S)315(a) .............................. 601 (b) .............................. 602 (c) .............................. 601 (d) .............................. 601 (e) .............................. 514 (S)316(a) .............................. 101 (a)(1)(A) .............................. 502 512 (a)(1)(B) .............................. 513 (a)(2) .............................. Not Applicable (b) .............................. 508 (c) .............................. 104(c) (S)317(a)(1) .............................. 503 (a)(2) .............................. 504 (b) .............................. 1003 (S)318(a) .............................. 107
16 EX-99 9 FORM T-1 OF MARINE MIDLAND BANK Conformed Copy Exhibit 99 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ------------------ FORM T-1 STATEMENT OF ELIGIBILITY UNDER THE TRUST INDENTURE ACT OF 1939 OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE ------------------ CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF A TRUSTEE PURSUANT TO SECTION 305(b)(2) ------------------ Marine Midland Bank (Exact name of trustee as specified in its charter) New York 16-1057879 (Jurisdiction of incorporation (I.R.S. Employer or organization if not a U.S. Identification No.) national bank) 140 Broadway, New York, N.Y. 10005-1180 (212) 658-1000 (Zip Code) (Address of principal executive offices) John J. Mazzarella Vice President Marine Midland Bank 140 Broadway New York, New York 10005-1180 Tel: (212) 658-1792 (Name, address and telephone number of agent for service) CIGNA CORPORATION (Exact name of registrant as specified in its charter) Delaware 06-1059331 (State or other jurisdiction (I.R.S. Employer Identification No.) of incorporation or organization) One Liberty Place, 1650 Market St., P.O. Box 7716, Philadelphia, Pennsylvania, 19192-1550 (215) 761-1000 (Address, including zip code, and telephone number, including area code of registrant's principal executive offices) Thomas J. Wagner Executive Vice President and General Counsel CIGNA Corporation One Liberty Place, 1650 Market St., P.O. Box 7716, Philadelphia, Pennsylvania, 19192-1550 (215) 761-6027 (Name, Address, Including Zip Code, and Telephone Number, Including Area Code, Of Agent for Service) Debt Securities (Title of Indenture Securities) General Item 1. General Information. ------------------- Furnish the following information as to the trustee: (a) Name and address of each examining or supervisory authority to which it is subject. State of New York Banking Department. Federal Deposit Insurance Corporation, Washington, D.C. Board of Governors of the Federal Reserve System, Washington, D.C. (b) Whether it is authorized to exercise corporate trust powers. Yes. Item 2. Affiliations with Obligor. ------------------------- If the obligor is an affiliate of the trustee, describe each such affiliation. None Item 16. List of Exhibits. ----------------
Exhibit - ------- T1A(i) * - Copy of the Organization Certificate of Marine Midland Bank. T1A(ii) * - Certificate of the State of New York Banking Department dated December 31, 1993 as to the authority of Marine Midland Bank to commence business. T1A(iii) - Not applicable. T1A(iv) * - Copy of the existing By-Laws of Marine Midland Bank as adopted on January 20, 1994. T1A(v) - Not applicable. T1A(vi) * - Consent of Marine Midland Bank required by Section 321(b) of the Trust Indenture Act of 1939. T1A(vii) - Copy of the latest report of condition of the trustee (March 31, 1998), published pursuant to law or the requirement of its supervisory or examining authority. T1A(viii) - Not applicable. T1A(ix) - Not applicable.
* Exhibits previously filed with the Securities and Exchange Commission with Registration No. 33-53693 and incorporated herein by reference thereto. SIGNATURE Pursuant to the requirements of the Trust Indenture Act of 1939, the Trustee, Marine Midland Bank, a banking corporation and trust company organized under the laws of the State of New York, has duly caused this statement of eligibility to be signed on its behalf by the undersigned, thereunto duly authorized, all in the City of New York and State of New York on the 22nd day of June, 1998. MARINE MIDLAND BANK By: /s/ Robert A. Conrad --------------------------------- Robert A. Conrad Vice President Exhibit T1A (vii) Board of Governors of the Federal Reserve System OMB Number: 7100-0036 Federal Deposit Insurance Corporation OMB Number: 3064-0052 Office of the Comptroller of the Currency OMB Number: 1557-0081 Federal Financial Institutions Examination Council Expires March 31, 2000 - -------------------------------------------------------------------------------- Please refer to page i, ----- Table of Contents, for 1 the required disclosure ----- of estimated burden. - -------------------------------------------------------------------------------- Consolidated Reports of Condition and Income for A Bank With Domestic and Foreign Offices--FFIEC 031 Report at the close of business March 31, 1998 This report is required by law; 12 U.S.C. (S)324 (State member banks); 12 U.S.C. (S) 1817 (State nonmember banks); and 12 U.S.C. (S)161 (National banks). NOTE: The Reports of Condition and Income must be signed by an authorized officer and the Report of Condition must be attested to by not less than two directors (trustees) for State nonmember banks and three directors for State member and National Banks. I, Gerald A. Ronning, Executive VP & Controller --------------------------------------------------- Name and Title of Officer Authorized to Sign Report of the named bank do hereby declare that these Reports of Condition and Income (including the supporting schedules) have been prepared in conformance with the instructions issued by the appropriate Federal regulatory authority and are true to the best of my knowledge and believe. /s/ Gerald A. Ronning ------------------------------------------------- Signature of Officer Authorized to Sign Report 4/27/98 ------------------------------------------------- Date of Signature (971231) ----------- (RCRI 9999) This report form is to be filed by banks with branches and consolidated subsidiaries in U.S. territories and possessions, Edge or Agreement subsidiaries, foreign branches, consolidated foreign subsidiaries, or International Banking Facilities. The Reports of Condition and Income are to be prepared in accordance with Federal regulatory authority instructions. We, the undersigned directors (trustees), attest to the correctness of this Report of Condition (including the supporting schedules) and declare that it has been examined by us and to the best of our knowledge and belief has been prepared in conformance with the instructions issued by the appropriate Federal regulatory authority and is true and correct. /s/ Malcolm Burnett ------------------------------------------------- Director (Trustee) /s/ Bernard J. Kennedy ------------------------------------------------- Director (Trustee) /s/ Sal H. Alfiero ------------------------------------------------- Director (Trustee) Submission of Reports Each Bank must prepare its Reports of Condition and Income either: (a) in automated form and then file the computer data file directly with the banking agencies' collection agent, Electronic Data System Corporation (EDS), by modem or computer diskette; or (b) in hard-copy (paper) form and arrange for another party to convert the paper report to automated for. That party (if other than EDS) must transmit the bank's computer data file to EDS To fulfill the signature and attestation requirement for the Reports of Condition and Income for this report date, attach this signature page to the hard-copy of the completed report that the bank places in its files. - -------------------------------------------------------------------------------- FDIC Certificate Number | 0 | 0 | 5 | 8 | 9 | --------------------- (RCRI 9030) REPORT OF CONDITION Consolidating domestic and foreign subsidiaries of the Marine Midland Bank of Buffalo Name of Bank City in the state of New York, at the close of business March 31, 1998 ASSETS Thousands of dollars Cash and balances due from depository institutions: Noninterest-bearing balances currency and coin ........................................ $ 1,256,485 Interest-bearing balances ................................ 2,022,831 Held-to-maturity securities .............................. 0 Available-for-sale securities ............................ 3,703,793 Federal funds sold and securities purchased under agreements to resell ............................... 1,758,449 Loans and lease financing receivables: Loans and leases net of unearned income ..................................21,468,541 LESS: Allowance for loan and lease losses .................................. 404,696 LESS: Allocated transfer risk reserve 0 Loans and lease, net of unearned income, allowance, and reserve............................ 21,063,845 Trading assets ........................................... 885,006 Premises and fixed assets (including capitalized leases) ...................................... 215,178 Other real estate owned ..................................... 13,130 Investments in unconsolidated subsidiaries and associated companies ....................... 0 Customers' liability to this bank on acceptances outstanding ..................................... 28,219 Intangible assets ........................................... 471,296 Other assets ................................................ 501,251 Total assets ................................................ 31,919,483 LIABILITIES Deposits: In domestic offices ...................................... 20,966,355 Noninterest-bearing ................... 3,689,470 Interest-bearing ...................... 17,276,885 In foreign offices, Edge, and Agreement subsidiaries, and IBFs ...................................... 4,101,409 Noninterest-bearing ................... 0 Interest-bearing ...................... 4,101,409 Federal funds purchased and securities sold under agreements to repurchase ........................... 814,706 Demand notes issued to the U.S. Treasury .................... 309,243 Trading Liabilities ......................................... 143,683 Other borrowed money: With a remaining maturity of one year or less .................................................. 1,878,712 With a remaining maturity of more than one year through three years ............................. 70,086 With a remaining maturity of more than three years .............................................. 54,547 Bank's liability on acceptances executed and outstanding .................................... 28,219 Subordinated notes and debentures ........................... 497,837 Other liabilities ........................................... 822,464 Total liabilities ........................................... 29,687,261 EQUITY CAPITAL Perpetual preferred stock and related surplus ..................................................... 0 Common Stock ................................................ 205,000 Surplus ..................................................... 1,984,728 Undivided profits and capital reserves ...................... 19,101 Net unrealized holding gains (losses) on available-for-sale securities ............................ 23,393 Cumulative foreign currency translation adjustments ................................................. 0 Total equity capital ........................................ 2,232,222 Total liabilities, limited-life preferred stock, and equity capital ......................... 31,919,483 -----END PRIVACY-ENHANCED MESSAGE-----