<PAGE>
RULE NO. 424(b)(5)
REGISTRATION NO. 33-65396
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
+ THE INFORMATION CONTAINED HEREIN IS SUBJECT TO AMENDMENT AND COMPLETION. +
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
SUBJECT TO COMPLETION, DATED MAY 9, 1997
PROSPECTUS SUPPLEMENT TO PROSPECTUS DATED DECEMBER 22, 1993
(R) $600,000,000
LOGO CIGNA CORPORATION
$ % NOTES DUE MAY , 2007
$ % DEBENTURES DUE MAY , 2027
-----------
Interest on the % Notes due May , 2007 and the % Debentures due May ,
2027 is payable on May 15 and November 15 of each year, commencing November 15,
1997. Neither the Notes nor the Debentures will be redeemable prior to
maturity.
The Notes and Debentures will be issued only in registered form in
denominations of $1,000 and integral multiples thereof. Each of the Notes and
the Debentures will be represented by one or more Global Securities registered
in the name of a nominee of The Depository Trust Company. Beneficial interests
in the Global Securities will be shown on, and transfers thereof will be
effected only through, records maintained by DTC and its participants. Except
as described herein, Notes and Debentures in definitive form will not be
issued. See "Description of Notes and Debentures".
-----------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS SUPPLEMENT OR
THE PROSPECTUS TO WHICH IT RELATES. ANY REPRESENTATION TO THE CONTRARY
IS A CRIMINAL OFFENSE.
-----------
<TABLE>
<CAPTION>
INITIAL PUBLIC UNDERWRITING PROCEEDS TO
OFFERING PRICE(1) DISCOUNT(2) COMPANY(1)(3)
----------------- ------------ -------------
<S> <C> <C> <C>
Per Note........................... % % %
Total.............................. $ $ $
Per Debenture...................... % % %
Total.............................. $ $ $
</TABLE>
- -----
(1) Plus accrued interest, if any, from May , 1997.
(2) The Company has agreed to indemnify the Underwriters against certain
liabilities, including liabilities under the Securities Act of 1933.
(3) Before deducting estimated expenses of $ payable by the Company.
-----------
The Notes and the Debentures are offered severally by the Underwriters, as
specified herein, subject to receipt and acceptance by them and subject to
their right to reject any order in whole or in part. It is expected that the
Notes and the Debentures will be ready for delivery in book-entry form only
through the facilities of DTC in New York, New York on or about May , 1997
against payment therefor in immediately available funds.
GOLDMAN, SACHS & CO.
CREDIT SUISSE FIRST BOSTON
MERRILL LYNCH & CO.
-----------
The date of this Prospectus Supplement is May , 1997.
<PAGE>
CERTAIN PERSONS PARTICIPATING IN THIS OFFERING MAY ENGAGE IN TRANSACTIONS
THAT STABILIZE, MAINTAIN OR OTHERWISE AFFECT THE PRICE OF THE NOTES AND THE
DEBENTURES INCLUDING OVER-ALLOTMENT, STABILIZING AND SHORT-COVERING
TRANSACTIONS IN SUCH SECURITIES, AND THE IMPOSITION OF A PENALTY BID, IN
CONNECTION WITH THE OFFERING. FOR A DESCRIPTION OF THESE ACTIVITIES, SEE
"UNDERWRITING".
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 PROSPECTUS SUPPLEMENT OR THE PROSPECTUS.
S-2
<PAGE>
THE COMPANY
With shareholders' equity of $7.2 billion and assets of $98.9 billion as of
December 31, 1996 and revenues of $19 billion for the year then ended, 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, in each case measured by
total assets and revenues. Unless the context otherwise indicates, the terms
"CIGNA" and "the Company," when used herein, refer to one or more of CIGNA
Corporation and its consolidated subsidiaries. Although CIGNA Corporation is
not itself an insurance company, its subsidiaries are major providers of group
life and health insurance, managed care products and services, retirement
products and services, individual financial services and property and casualty
insurance. The Company 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 organization in the
United States, based on the number of members. The Company's major insurance
subsidiaries, Connecticut General Life Insurance Company ("CG Life") and
Insurance Company of North America ("ICNA"), are among the oldest insurance
companies in the United States, with ICNA 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.
RATIO OF EARNINGS TO FIXED CHARGES
The following table sets forth CIGNA's ratio of earnings to fixed charges
for the periods indicated below:
<TABLE>
<CAPTION>
THREE MONTHS
ENDED
MARCH 31 YEAR ENDED DECEMBER 31,
------------- ------------------------
1997 1996 1996 1995 1994 1993 1992
------ ------ ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C>
Ratio of Earnings to Fixed Charges....... 11.4 8.3 9.5 2.1 4.6 1.7 1.8
</TABLE>
For purposes of computing the ratio of earnings to fixed charges, "earnings"
consists of income before federal income taxes and fixed charges. "Fixed
charges" consists of interest expense and an imputed interest component for
rental expense.
USE OF PROCEEDS
The net proceeds from the sale of the Notes and the Debentures offered
hereby, estimated to be approximately $ , will be used to finance a portion
of the acquisition costs (estimated to be approximately $1.65 billion) in
connection with the Company's acquisition of Healthsource, Inc., a New
Hampshire corporation ("Healthsource"). See "Recent Developments".
S-3
<PAGE>
CAPITALIZATION
The following table sets forth the historical short-term debt and
capitalization of the Company as of December 31, 1996 and the pro forma short-
term debt and capitalization of the Company as of December 31, 1996, as
adjusted to give effect to the Healthsource acquisition and the issuance and
sale of the Notes and the Debentures offered hereby and the application of the
estimated net proceeds therefrom as set forth in "Use of Proceeds". The
Healthsource acquisition will be accounted for as a purchase. This pro forma
presentation does not contain all potential adjustments related to the
acquisition which may subsequently be reflected in the financial statements.
Such additional adjustments have not been determined; however, CIGNA does not
expect them to be material. This table should be read in conjunction with the
December 31, 1996 consolidated financial statements of the Company, including
the notes thereto, which are incorporated herein by reference.
<TABLE>
<CAPTION>
AS OF DECEMBER 31, 1996
(IN MILLIONS)
---------------------------
HISTORICAL PRO FORMA(1)
---------- ------------
(UNAUDITED)
<S> <C> <C> <C>
Short-term debt.................................... $ 289 $ 689
====== ======
Long-term debt..................................... $1,021 $1,621
====== ======
Shareholders' equity:
Common stock..................................... $ 88 $ 88
Additional paid-in capital....................... 2,572 2,597
Net unrealized appreciation on investments....... 627 627
Net translation of foreign currencies............ (45) (45)
Retained earnings................................ 4,855 4,855
Treasury stock, at cost.......................... (889) (889)
------ ------
Total shareholders' equity..................... $7,208 $7,233
====== ======
Total short-term debt and capitalization..... $8,518 $9,543
====== ======
Ratio of total debt to total short-term debt
and capitalization............................ 15.4% 24.2%
====== ======
</TABLE>
- --------
(1) This presentation assumes that the Company acquires 100% of Healthsource's
outstanding shares for $1,388 million (63.8 million shares at $21.75 per
share). In addition, the Company will redeem all of Healthsource's
convertible debt at 101% of its face value for $250 million. The
acquisition would be financed by utilizing approximately $638 million of
internally generated funds, the issuance of $600 million in aggregate
principal amount of Notes and Debentures being offered hereby, and the
issuance of short-term debt for approximately $400 million. Under purchase
accounting, Healthsource's shareholders' equity is eliminated.
S-4
<PAGE>
SELECTED FINANCIAL INFORMATION
The following tables set forth certain historical selected 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, 1996 and its Quarterly Report on Form 10-Q for the quarter ended March 31,
1997. The selected historical financial information provided below is not
necessarily indicative of future results of operations or financial
performance for the Company.
<TABLE>
<CAPTION>
THREE MONTHS
ENDED MARCH 31, YEAR ENDED DECEMBER 31,
---------------- -------------------------------------------
1997 1996 1996 1995 1994 1993 1992
------- ------- ------- ------- ------- ------- -------
INCOME STATEMENT DATA (UNAUDITED)
- ---------------------
(DOLLARS IN MILLIONS, EXCEPT PER SHARE AMOUNTS)
<S> <C> <C> <C> <C> <C> <C> <C>
REVENUES:
Premiums and fees....... $ 3,388 $ 3,390 $13,916 $13,914 $13,912 $13,712 $13,924
Net investment income
and other revenues..... 1,213 1,225 4,943 4,808 4,438 4,408 4,493
Realized investment
gains.................. 44 30 91 233 42 282 165
------- ------- ------- ------- ------- ------- -------
Total.................. $ 4,645 $ 4,645 $18,950 $18,955 $18,392 $18,402 $18,582
======= ======= ======= ======= ======= ======= =======
NET INCOME (LOSS):
Employee Life and Health
Benefits............... $ 121 $ 110 $ 500 $ 597 $ 548 $ 589 $ 337
Employee Retirement and
Savings Benefits....... 62 61 222 194 190 159 191
Individual Financial
Services............... 55 34 168 151 136 110 49
Property and Casualty... 65 50 240 (673) (235) (530) (195)
Other Operations........ (15) (17) (74) (58) (85) (94) (71)
------- ------- ------- ------- ------- ------- -------
Total.................. $ 288 $ 238 $ 1,056 $ 211 $ 554 $ 234 $ 311
======= ======= ======= ======= ======= ======= =======
Net income per share... $ 3.86 $ 3.10 $ 13.85 $ 2.86 $ 7.66 $ 3.25 $ 4.34
======= ======= ======= ======= ======= ======= =======
<CAPTION>
BALANCE SHEET DATA
- ------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Total assets............ $98,752 $95,417 $98,932 $95,903 $86,102 $84,975 $78,034
Long-term debt.......... $ 910 $ 1,037 $ 1,021 $ 1,066 $ 1,389 $ 1,235 $ 929
Shareholders' equity.... $ 7,117 $ 6,863 $ 7,208 $ 7,157 $ 5,811 $ 6,575 $ 5,744
Per share.............. $ 96.18 $ 89.74 $ 97.15 $ 93.76 $ 80.46 $ 91.30 $ 80.09
Common shares
outstanding
(thousands)............ 73,994 76,480 74,198 76,332 72,225 72,015 71,720
Common dividends
declared per share..... $ 0.83 $ 0.80 $ 3.20 $ 3.04 $ 3.04 $ 3.04 $ 3.04
</TABLE>
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
-------------------------
OTHER DATA 1996 1995 1994
- ---------- ------- ------- -------
<S> <C> <C> <C>
EMPLOYEE LIFE & HEALTH BENEFITS SEGMENT STATISTICS: (DOLLARS IN MILLIONS)
Medical Covered Lives (thousands):
HMOs............................................ 4,315 3,930 3,501
Indemnity....................................... 4,570 4,700 5,458
------- ------- -------
Total......................................... 8,885 8,630 8,959
======= ======= =======
Dental Covered Lives (thousands):
Managed Care.................................... 2,548 2,290 1,993
Indemnity....................................... 7,901 8,032 8,173
------- ------- -------
Total......................................... 10,449 10,322 10,166
======= ======= =======
HMO Medical Loss Ratios........................... 84.4% 84.5% 82.7%
EMPLOYEE RETIREMENT & SAVINGS BENEFITS SEGMENT STA-
TISTICS:
Defined Contribution.............................. $20,017 $17,741 $14,456
Defined Benefit................................... 18,182 18,077 16,777
Other, including GICs............................. 1,539 1,542 1,998
Investment Advisory Accounts...................... 849 823 651
------- ------- -------
Total Assets under Management by Plan Type........ $40,587 $38,183 $33,882
======= ======= =======
INDIVIDUAL FINANCIAL SERVICES SEGMENT STATISTICS:
Deposits:
Life............................................ $ 1,407 $ 2,351 $ 2,349
Annuity......................................... 644 849 659
------- ------- -------
Total deposits................................ $ 2,051 $ 3,200 $ 3,008
======= ======= =======
PROPERTY & CASUALTY--ONGOING OPERATIONS:
Combined ratio after policyholders' dividends(1).. 101.6% 104.1%
======= ======= =======
</TABLE>
- --------
(1) See note (1) on Page S-8.
S-5
<PAGE>
RECENT DEVELOPMENTS
On February 27, 1997, the Company and Healthsource entered into an Agreement
and Plan of Merger (the "Merger Agreement") among the Company, Healthsource
and CHC Acquisition Corp., a wholly-owned subsidiary of the Company ("CHC
Acquisition"), providing for the transactions that will result in Healthsource
becoming a subsidiary of the Company. Under the terms of the Merger Agreement,
CHC Acquisition commenced a cash tender offer on March 6, 1997 for all
outstanding shares of common stock, par value $.10 per share, of Healthsource
(the "Healthsource Common Stock") at a price of $21.75 per share. Consummation
of the tender offer is subject to at least a majority of the shares of
Healthsource Common Stock, determined on a fully-diluted basis, being validly
tendered and not withdrawn prior to the expiration of the tender offer and the
receipt of all applicable regulatory approvals.
Based on December 31, 1996 information, Healthsource operates health
maintenance organizations in 15 states serving approximately 1.1 million
members. Healthsource also provides medical and dental indemnity products,
primarily self-insured products, which cover approximately 2 million and 2.5
million lives, respectively. In addition, Healthsource offers point of service
plans, preferred provider organization plans, utilization review services,
managed workers compensation services, pharmacy benefit management services
and other managed care consulting and administrative services.
S-6
<PAGE>
BUSINESS
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 Individual Insurance
CIGNA Reinsurance
Property and Casualty Segment
CIGNA Property & Casualty
CIGNA International
Other Operations primarily includes unallocated investment income, expenses
(principally debt service) and taxes. Also included in Other Operations are
the results of CIGNA's settlement annuity business and non-insurance
operations engaged primarily in investment and real estate activities.
S-7
<PAGE>
The following summarized financial information with respect to the business
segments for the year ended and as of December 31 was derived from and should
be read in conjunction with the Company's 1996 audited financial statements
and notes and the Company's Annual Report on Form 10-K for the year ended
December 31, 1996:
<TABLE>
<CAPTION>
1996
1996 % OF TOTAL 1995 1994
------------- ---------- ------- -------
(IN MILLIONS) (IN MILLIONS)
<S> <C> <C> <C> <C>
REVENUES
Employee Life and Health Benefits... $ 9,318 49% $ 9,167 $ 8,650
Employee Retirement and Savings Ben-
efits.............................. 1,950 10 1,983 1,935
Individual Financial Services....... 2,074 11 1,920 1,637
Property and Casualty(1):
International..................... 2,859 15 3,005 2,644
Domestic--ongoing................. 2,147 11 2,259
--pre-restructuring....... 3,386
------- --- -------
Ongoing operations................ 5,006 26 5,264
Run-off operations................ 478 3 471
------- --- ------- -------
Total Property and Casualty..... 5,484 29 5,735 6,030
Other Operations.................... 124 1 150 140
------- --- ------- -------
Total......................... $18,950 100% $18,955 $18,392
======= === ======= =======
OPERATING INCOME (LOSS)(2)
Employee Life and Health Benefits... $ 497 50% $ 493 $ 531
Employee Retirement and Savings Ben-
efits.............................. 201 20 192 184
Individual Financial Services....... 161 16 150 131
Property and Casualty(1):
International..................... 135 13 128 55
Domestic--ongoing................. 76 8 (60)
--pre-structuring......... (294)
------- --- -------
Ongoing operations................ 211 21 68
Run-off operations................ 2 -- (795)
------- --- ------- -------
Total Property and Casualty..... 213 21 (727) (239)
Other Operations.................... (70) (7) (75) (81)
------- --- ------- -------
Total......................... $ 1,002 100% $ 33 $ 526
======= === ======= =======
IDENTIFIABLE ASSETS
Employee Life and Health Benefits... $11,590 12% $12,206 $11,331
Employee Retirement and Savings Ben-
efits.............................. 40,399 41 37,736 33,939
Individual Financial Services....... 17,581 18 15,913 12,195
Property and Casualty(1):
International..................... 7,611 8 7,603 6,785
Domestic--ongoing................. 10,553 10 9,843
--pre-restructuring........... 18,850
------- --- -------
Ongoing operations................ 18,164 18 17,446
Run-off operations................ 8,043 8 8,872
------- --- ------- -------
Total Property and Casualty..... 26,207 26 26,318 25,635
Other Operations.................... 3,155 3 3,730 3,002
------- --- ------- -------
Total......................... $98,932 100% $95,903 $86,102
======= === ======= =======
</TABLE>
- --------
(1) CIGNA's domestic property and casualty operations were restructured into
ongoing and run-off operations effective December 31, 1995. Amounts shown
for the Property and Casualty segment's ongoing and run-off operations for
1995 are reported on a pro forma basis as though the restructuring was in
place at the beginning of 1995. These pro forma results are not necessarily
indicative of the results that would have been reported had the
restructuring actually occurred as of January 1, 1995. Information for the
Property and Casualty segment on a pro forma basis is not available for
1994. Consolidated Property and Casualty segment amounts, including
International, did not change as a result of the restructuring.
(2) Operating income (loss) is defined as net income (loss) excluding after-
tax realized investment results.
S-8
<PAGE>
EMPLOYEE LIFE AND HEALTH BENEFITS
CIGNA's Employee Life and Health Benefits Segment consists of the CIGNA
HealthCare and CIGNA Group Insurance divisions.
CIGNA HEALTHCARE
CIGNA HealthCare offers a range of group medical, dental and life insurance
products, and designs benefit programs to meet the needs of employers of all
sizes and their employees. Among investor-owned managed care and indemnity
companies, CIGNA HealthCare is one of the nation's leading providers of health
benefit programs, with products marketed in all 50 states, and managed care
networks in 43 states, the District of Columbia and Puerto Rico. CIGNA
HealthCare's national managed dental care networks serve 39 states and the
District of Columbia.
CIGNA HealthCare's products and services include managed medical and dental
care products, indemnity group health insurance and related services; managed
mental health and substance abuse care and employee assistance programs;
managed pharmacy services; disability management, medical cost management and
utilization management services; and group life insurance. Products are
marketed by the division's sales representatives, primarily through employee
benefits brokers and consultants. Managed mental health care and employee
disability management and medical cost management services are marketed
directly to insurers, employer groups and managed care organizations. Employee
disability management and medical cost management services also are marketed
directly to third-party administrators.
Certain business information with respect to CIGNA HealthCare for the year
ended December 31, 1996 is set forth below (dollars in millions):
<TABLE>
<S> <C>
Premiums and Fees............................................... $ 6,987
Premium Equivalents............................................. 9,552
-------
Adjusted Premiums and Fees.................................... $16,539
=======
Business Mix (Adjusted Premiums and Fees)
Health Indemnity (Medical and Dental)......................... 55%
Managed Medical and Dental.................................... 38
Life.......................................................... 7
-------
Total....................................................... 100%
=======
</TABLE>
CIGNA GROUP INSURANCE
CIGNA Group Insurance provides employer-paid and voluntary life, accident
and disability products, and designs disability management services to meet
the needs of employers. Its products and services include short- and long-term
disability insurance and disability management services; group voluntary and
business travel accident insurance; group term life insurance, group universal
life insurance and group variable universal life insurance; and specialty
plans for nonemployer-sponsored groups and selected employer groups.
Based on earned premiums, CIGNA Group Insurance is the leading U.S. provider
of group accident insurance, including voluntary accident and business travel
accident insurance. It also is among the largest providers of group long-term
disability insurance, with a full spectrum of disability management services
and group life insurance, including group universal life and group variable
universal life.
S-9
<PAGE>
The sales force sells the division's products through employee benefits
brokers and consultants to employers of all sizes, as well as to employees and
their families. The division also markets products to members of affinity
groups, such as customers of financial institutions. It maintains specialized
service centers for customers with voluntary products and a claim organization
with expertise in life, accident and disability claims management, including
vocational rehabilitation and other cost-containment services.
Certain business information with respect to CIGNA Group Insurance for the
year ended December 31, 1996 is set forth below (dollars in millions):
<TABLE>
<S> <C>
Premiums and Fees................................................ $1,354
======
Business Mix (Premiums and Fees)
Life........................................................... 46%
Disability..................................................... 30
Accident....................................................... 20
Other Health................................................... 4
------
Total 100%
======
</TABLE>
EMPLOYEE RETIREMENT AND SAVINGS BENEFITS
CIGNA Retirement & Investment Services is among the leading managers of
retirement plan assets in the United States, based on assets under management.
The division provides defined contribution and defined benefit plan investment
products and administrative services, either separately or as full-service
packages, to U.S. employers, municipalities and labor organizations. These
organizations offer retirement benefits to more than five million people.
A new discount brokerage operation, CIGNA Financial Services, also supports
the individual investor with a range of IRA rollover investments and both tax-
deferred and taxable investments and services. Products and services are
offered primarily through dedicated retirement plan specialists in offices
nationwide, the benefit consulting community and financial intermediaries.
Certain business information with respect to CIGNA Retirement & Investment
Services for the year ended December 31, 1996 is set forth below (dollars in
millions):
<TABLE>
<S> <C>
Deposits......................................................... $ 5,844
=======
Assets under Management
Defined Contribution........................................... $20,017
Defined Benefit................................................ 18,182
Other.......................................................... 2,388
-------
Total........................................................ $40,587
=======
</TABLE>
Products and services offered by CIGNA Retirement & Investment Services
include: 401(k) and other defined contribution plans; defined benefit pension
plans; institutional investment management; discount brokerage services;
investments managed by CIGNA, Fidelity, Warburg Pincus, INVESCO, American
Century, PBHG and others; directed trustee services; actuarial valuation and
consulting; toll-free phone services for plan participants; benefit
calculations and payment services; and benefits outsourcing.
S-10
<PAGE>
INDIVIDUAL FINANCIAL SERVICES
CIGNA's Individual Financial Services Segment consists of the CIGNA
Individual Insurance and CIGNA Reinsurance divisions.
CIGNA INDIVIDUAL INSURANCE
CIGNA Individual Insurance manages four businesses. Individual insurance
products, investment products and fee-based financial planning services are
sold to affluent clients, including business owners, professionals and
executives, through CIGNA Financial Advisors, the division's career agency
sales force. A life brokerage operation sells individual life insurance
products to affluent individuals through independent managing general agents,
independent brokers and broker/dealers. Corporate-owned life insurance is sold
through brokers to major corporations. Individual fixed and variable annuity
products are sold to a wide range of individual clients, primarily by bank
representatives, stockbrokers and life insurance agents.
Certain business information with respect to CIGNA Individual Insurance for
the year ended December 31, 1996 is set forth below (dollars in millions):
<TABLE>
<S> <C>
Premiums and Fees............................................... $ 649
Deposits........................................................ 2,051
-------
Total......................................................... $ 2,700
=======
Business Mix (Premiums, Fees and Deposits)
Life.......................................................... 76%
Annuity....................................................... 24
-------
Total......................................................... 100%
=======
Individual Life Insurance
In Force...................................................... $94,124
=======
Annuity Assets.................................................. $ 2,638
=======
</TABLE>
CIGNA REINSURANCE
CIGNA Reinsurance markets risk management products and services on a direct
basis and through domestic and foreign intermediaries. Customers include
traditional risk-bearing companies, including individual and group life,
accident and health insurers; the special risk and workers' compensation units
of property-casualty insurers; companies that offer immediate and deferred
annuities; health care providers; and managing general underwriters of health
care and sports.
Certain business information with respect to CIGNA Reinsurance for the year
ended December 31, 1996 is set forth below (dollars in millions):
<TABLE>
<S> <C>
Premiums and Fees.................................................. $293
====
Business Mix (Premiums and Fees)
Life............................................................. 40%
Health........................................................... 31
Accident......................................................... 29
----
Total.......................................................... 100%
====
</TABLE>
Products and services provided by CIGNA Reinsurance include: reinsurance of
personal accident insurance, including individual and group accidental death &
dismemberment, catastrophe covers, special risk accident, aviation,
occupational accident, and amateur and professional sports;
S-11
<PAGE>
reinsurance of individual and group life insurance; and annuities, including
variable annuity minimum death benefits; reinsurance of capitation risks of
health care providers; reinsurance of morbidity risks of health care insurers
and self-insured employers; and reinsurance pool management.
PROPERTY AND CASUALTY
CIGNA's Property and Casualty segment consists of the CIGNA Property &
Casualty division--domestic and run-off operations--and the CIGNA
International division.
CIGNA PROPERTY & CASUALTY
CIGNA Property & Casualty provides global commercial insurance and risk
management services to U.S. businesses of all sizes and to other groups and
individuals with specialized insurance needs. As a specialist, it provides
these products and services through 20 businesses operating in three business
units: Special Risk Facilities, which focuses on U.S.-based large-risk
customers; Specialty Insurance Services, which serves clients with unique
needs; and Commercial Insurance Services, which serves the standard commercial
market with emphasis on customers interested in total loss containment. All
three units distribute products through brokers and independent agents.
Certain business information with respect to CIGNA Property & Casualty--
domestic for the year ended December 31, 1996, is set forth below (dollars in
millions):
<TABLE>
<S> <C>
Net Premiums Written.............................................. $1,637
======
Business Mix (Net Premiums Written)
Special Risk Facilities......................................... 28%
Specialty Insurance Services.................................... 44
Commercial Insurance Services................................... 28
------
Total......................................................... 100%
======
</TABLE>
Products and services provided by CIGNA Property & Casualty's Special Risk
Facilities include large-risk property and casualty coverages, including
multi-line and multi-year packages; risk management services on a bundled or
unbundled basis; and integrated access to specialty lines and to international
insurance. Specialty Insurance Services provides coverages for specialty
programs, aviation, recreational and ocean marine, financial institutions,
agribusiness, excess casualty and other specialty niches. Products and
services of Commercial Insurance Services include risk transfer workers'
compensation, inland marine, commercial packages, commercial automobile, and
tailored programs for groups, associations and small commercial accounts.
CIGNA INTERNATIONAL
CIGNA International provides individual life, accident and health, employee
benefits (group life and health) and commercial property and casualty
coverages and services in jurisdictions outside the United States and
multinationally. The division maintains a sales or operational presence in
major markets around the world to support its product and service
capabilities.
Property and casualty products are marketed primarily to mid-sized and large
commercial customers, while accident and health coverages are sold principally
to individuals. Life products are targeted to individuals in middle- and
upper-income segments; employee benefits and related group life and health
coverages are marketed to businesses of every size, from small businesses to
multinational corporations. The division distributes its products through
major international or local brokers, direct response or direct sales forces
and, in selected countries, independent agents.
S-12
<PAGE>
Certain business information with respect to CIGNA International for the
year ended December 31, 1996 is set forth below (dollars in millions):
<TABLE>
<S> <C>
Net Premiums Written.............................................. $2,589
======
Business Mix (Net Premiums Written)
Accident and Health............................................. 25%
Individual Life................................................. 23
Employee Benefits............................................... 8
Property........................................................ 20
Marine, Auto and Other.......................................... 14
Casualty........................................................ 10
------
Total......................................................... 100%
======
</TABLE>
Products and services provided by CIGNA International include whole life,
term life and variable life insurance; accident, health and disability
insurance; group and employee benefits: medical indemnity insurance, managed
health care programs and pensions; commercial property and casualty insurance,
marine and other specialty lines; and international loss control, engineering,
claims settlement and risk management services.
RESTRUCTURING
Effective December 31, 1995, CIGNA restructured its domestic property and
casualty businesses into two separate operations, ongoing and run-off. The
ongoing operations are actively engaged in selling insurance products and
related services. The run-off operations, which do not actively sell insurance
products, manage run-off policies and related claims, including those for
asbestos-related and environmental pollution exposures. Insurance products
that were actively sold in 1995 by subsidiaries that are now in run-off
continue to be sold by the ongoing operations. Results for the run-off
operations primarily reflect current year losses associated with unearned
premiums as of December 31, 1995, prior year development on claim and claim
adjustment expense reserves, and investment activity. The restructuring is
being contested in the courts by certain competitors and policyholders;
however, CIGNA expects to ultimately prevail.
INVESTMENTS
CIGNA's investment strategy is to manage the characteristics of investment
assets, such as liquidity, currency, yield and duration, to reflect the
underlying characteristics of the related insurance and contractholder
liabilities, which vary among CIGNA's principal product lines. In connection
with this investment strategy, CIGNA uses derivative instruments through
hedging applications to minimize market risk.
As of December 31, 1996, $33.5 billion, or 96%, of bonds were investment
grade, and $1.4 billion, or 4% were below investment grade (BA and below, or
equivalent).
INVESTMENT ASSETS
The following table summarizes CIGNA's investment assets as of December 31
(in millions):
<TABLE>
<CAPTION>
1996 1995
------- -------
<S> <C> <C>
Fixed maturities............................................ $34,933 $36,241
Equity securities........................................... 701 661
Mortgage loans.............................................. 10,927 11,010
Real estate................................................. 1,102 1,283
Other, primarily policy loans............................... 8,871 8,515
------- -------
Total investment assets..................................... $56,534 $57,710
======= =======
</TABLE>
S-13
<PAGE>
INVESTMENT INCOME
The following table summarizes net investment income, including policyholder
share, for the year ended December 31 (in millions):
<TABLE>
<CAPTION>
1996 1995 1994
------ ------ ------
<S> <C> <C> <C>
Fixed maturities....................................... $2,613 $2,571 $2,465
Equity securities...................................... 20 47 67
Mortgage loans......................................... 982 932 892
Policy loans........................................... 561 511 371
Real estate............................................ 223 317 327
Other long-term investments............................ 65 77 73
Short-term investments................................. 110 199 128
------ ------ ------
4,574 4,654 4,323
Less investment expenses............................... 241 358 377
------ ------ ------
Net investment income.................................. $4,333 $4,296 $3,946
====== ====== ======
</TABLE>
PROBLEM INVESTMENTS AND REAL ESTATE
CIGNA's investments include problem bonds and mortgage loans, potential
problem bonds and mortgage loans and real estate held for sale, primarily
foreclosure properties. CIGNA considers problem bonds and mortgage loans those
that are delinquent or restructured as to terms, typically interest rate and,
in certain cases, maturity date. Delinquent mortgage loans include those on
which payment is overdue generally 60 days or more. Potential problem bonds
and mortgage loans are fully current but judged by management to have certain
characteristics that increase the likelihood of problem classification.
Potential problem mortgage loans also include fully current loans for which
the borrower has requested restructuring and loans that are 30-59 days
delinquent with respect to interest or principal payments.
The following table summarizes problem investments and real estate held for
sale, including amounts attributable to policyholder contracts, net of
cumulative write-downs and valuation reserves, as of December 31:
<TABLE>
<CAPTION>
1996 1995 1994
------ ------ ------
(IN MILLIONS)
<S> <C> <C> <C>
Problem bonds.......................................... $ 160 $ 196 $ 307
Problem mortgage loans................................. 363 575 796
Real estate held for sale
(primarily foreclosure properties).................... 607 720 892
------ ------ ------
Total................................................ $1,130 $1,491 $1,995
====== ====== ======
</TABLE>
The following table summarizes potential problem investments, including
amounts attributable to policyholder contracts, net of cumulative write-downs
and valuation reserves, as of December 31:
<TABLE>
<CAPTION>
1996 1995 1994
---- ---- ----
(IN MILLIONS)
<S> <C> <C> <C>
Potential problem bonds...................................... $107 $137 $141
Potential problem mortgage loans............................. 384 211 350
---- ---- ----
Total...................................................... $491 $348 $491
==== ==== ====
</TABLE>
The overall decline in problems is due to improved economic conditions,
including real estate market conditions, and net sales of foreclosed real
estate.
S-14
<PAGE>
DESCRIPTION OF NOTES AND DEBENTURES
The following description of the particular terms of the Notes and
Debentures offered hereby (referred to in the Prospectus as the "Senior Debt
Securities") supplements, and to the extent inconsistent therewith replaces,
the description of the general terms and provisions of Debt Securities and
Senior Debt Securities set forth in the Prospectus, to which description
reference is hereby made.
DESCRIPTION OF THE NOTES
The Notes offered hereby will be limited to aggregate principal
amount and will mature on May , 2007. The Notes will not be entitled to a
sinking fund and will not be redeemable prior to maturity. Interest at the
annual rate set forth on the cover page hereof will be payable semiannually on
May 15 and November 15, commencing November 15, 1997, to the persons in whose
names the Notes are registered at the close of business on the May 1 or
November 1, as the case may be, preceding such interest payment date. Interest
on the Notes will accrue from May , 1997. The Notes will be issued as a
single series of Senior Debt Securities under the Senior Indenture described
in the Prospectus, in denominations of $1,000 or any integral multiple
thereof.
The Notes will be subject to defeasance and discharge and to defeasance of
certain obligations and certain events of default. The Notes will be unsecured
and will rank on a parity with all other unsecured and unsubordinated
indebtedness of the Company.
See "Description of Debt Securities" and "Senior Debt Securities" in the
Prospectus.
DESCRIPTION OF THE DEBENTURES
The Debentures offered hereby will be limited to $ aggregate principal
amount and will mature on May , 2027. The Debentures will not be entitled to
a sinking fund and will not be redeemable prior to maturity. Interest at the
annual rate set forth on the cover page hereof will be payable semiannually on
May 15 and November 15, commencing November 15, 1997, to the persons in whose
names the Debentures are registered at the close of business on the May 1 or
November 1, as the case may be, preceding such interest payment date. Interest
on the Debentures will accrue from May , 1997. The Debentures will be issued
as a single series of Senior Debt Securities under the Senior Indenture
described in the Prospectus, in denominations of $1,000 or any integral
multiple thereof.
The Debentures will be subject to defeasance and discharge and to defeasance
of certain obligations and certain events of default. The Debentures will be
unsecured and will rank on a parity with all other unsecured and
unsubordinated indebtedness of the Company.
See "Description of Debt Securities" and "Senior Debt Securities" in the
Prospectus.
BOOK-ENTRY PROCEDURES
Upon issuance, all Notes and all Debentures 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 Notes or
Debentures, as applicable, 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
S-15
<PAGE>
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 1934 Act. The Depository was created to hold
securities of its participants (defined below) and to facilitate the clearance
and settlement transactions 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 Notes and Debentures 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 Notes and Debentures, the Depository will credit, on its
book-entry registration and transfer system, the participants' accounts with
the respective principal amounts of the Notes and Debentures. 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 Notes or Debentures, as applicable,
represented by such Global Security for all purposes under the Senior
Indenture. Except as provided below, owners of beneficial interests in a
Global Security will not be entitled to have the Notes or Debentures, as
applicable, represented by such Global Securities registered in their names,
will not receive or be entitled to receive physical delivery of the Notes or
Debentures, as applicable, in definitive form and will not be considered the
owners or Holders thereof under the Senior 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 Senior 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 Senior 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, Notes and Debentures 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 such Notes or Debentures, as applicable. None of the Company, the
Senior Trustee or any other agent of the Company or agent of the Senior
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
S-16
<PAGE>
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.
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 Senior 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 Notes or Debentures, the Global Securities will be
transferable or exchangeable for Notes or Debentures, as applicable, in
definitive form of like tenor in an equal aggregate principal amount. Such
definitive Notes or Debentures shall be registered in such name or names as
the Depository shall instruct the Senior 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.
S-17
<PAGE>
UNDERWRITING
Subject to the terms and conditions set forth in the Underwriting Agreement
and the Pricing Agreement, the Company has agreed to sell to each of the
Underwriters named below, and each of such Underwriters has severally agreed
to purchase, the principal amount of the Notes and Debentures set forth
opposite its name below:
<TABLE>
<CAPTION>
PRINCIPAL AMOUNT PRINCIPAL AMOUNT
UNDERWRITER OF NOTES OF DEBENTURES
----------- ---------------- ----------------
<S> <C> <C>
Goldman, Sachs & Co. ...................... $ $
Credit Suisse First Boston Corporation.....
Merrill Lynch, Pierce, Fenner & Smith
Incorporated..........................
--------- ----------
Total.................................... $ $
========= ==========
</TABLE>
Under the terms and conditions of the Underwriting Agreement and the Pricing
Agreement, the Underwriters are committed to take and pay for all of the Notes
or Debentures, if any are taken.
The Underwriters propose to offer the Notes in part directly to the public
at the initial public offering price set forth on the cover page of this
Prospectus Supplement and in part to certain securities dealers at such price
less a concession of % of the principal amount of the Notes. The
Underwriters may allow, and such dealers may reallow, a concession not to
exceed % of the principal amount of the Notes to certain brokers and
dealers. After the Notes are released for sale to the public, the offering
price and other selling terms may from time to time be varied by the
Underwriters.
The Underwriters propose to offer the Debentures in part directly to the
public at the initial public offering price set forth on the cover page of
this Prospectus Supplement and in part to certain securities dealers at such
price less a concession of % of the principal amount of the Debentures. The
Underwriters may allow, and such dealers may reallow, a concession not to
exceed % of the principal amount of the Debentures to certain brokers and
dealers. After the Debentures are released for sale to the public, the
offering price and other selling terms may from time to time be varied by the
Underwriters.
In connection with the offering, the Underwriters may purchase and sell the
Notes and the Debentures in the open market. These transactions may include
over-allotment and stabilizing transactions and purchases to cover short
positions created by the Underwriters in connection with the offering.
Stabilizing transactions consist of certain bids or purchases for the purpose
of preventing or retarding a decline in the market price of the Notes or
Debentures; and short positions created by the Underwriters involve the sale
by the Underwriters of a greater number of Notes or Debentures than they are
required to purchase from the Company in the offering. The Underwriters also
may impose a penalty bid, whereby selling concessions allowed to brokers-
dealers in respect of the securities sold in the offering may be reclaimed by
the Underwriters if such Notes or Debentures are repurchased by the
Underwriters in stabilizing or covering transactions. These activities may
stabilize, maintain or otherwise affect the market price of the Notes or
Debentures, which may be higher than the price that might otherwise prevail in
the open market; and these activities, if commenced, may be discontinued at
any time. These transactions may be effected in the over-the-counter market or
otherwise.
The Notes and the Debentures are a new issue of securities with no
established trading market. The Company has been advised by the Underwriters
that the Underwriters intend to make a market in the Notes and Debentures but
are not obligated to do so and may discontinue market making at any time
without notice. No assurance can be given as to the liquidity of the trading
market for the Notes and Debentures.
S-18
<PAGE>
The Company has agreed to indemnify the several Underwriters against certain
liabilities, including liabilities under the Securities Act of 1933, as
amended.
VALIDITY OF NOTES AND DEBENTURES
The validity of the Notes and the Debentures will be passed upon for the
Company by Thomas J. Wagner, Esq., Executive Vice President and General
Counsel for the Company, and for the Underwriters by Sullivan & Cromwell, New
York, New York. Mr. Wagner is the beneficial owner of 24,607 shares of Common
Stock and holds options to acquire 32,028 shares which are exercisable within
60 days.
EXPERTS
The consolidated financial statements and financial statement schedules of
CIGNA Corporation as of December 31, 1996 and 1995 and for each of the three
years in the period ended December 31, 1996 incorporated herein by reference
to the Annual Report on Form 10-K of the Company for the year ended December
31, 1996 have been so incorporated in reliance on the reports of Price
Waterhouse LLP, independent accountants, given on the authority of said firm
as experts in auditing and accounting.
S-19
<PAGE>
LOGO
CIGNA CORPORATION
DEBT SECURITIES, PREFERRED STOCK
AND COMMON STOCK
-----------
CIGNA Corporation ("CIGNA" or the "Company") may from time to time offer,
together or separately, its Debt Securities consisting of debentures, notes
and/or other unsecured evidences of indebtedness; shares of its Preferred
Stock, par value $1.00 per share; and shares of its Common Stock, par value
$1.00 per share. The Debt Securities, Preferred Stock and Common Stock are
collectively called the "Securities". The Securities offered pursuant to this
Prospectus may be issued in one or more series or issuances at an aggregate
initial offering price not to exceed $900,000,000 (or its equivalent based on
the applicable exchange rate at the time of sale in one or more foreign
currencies, composite currencies or in amounts determined by reference to an
index as shall be designated by the Company). The Debt Securities may be
convertible subordinated Debt Securities which, unless previously redeemed or
otherwise purchased or acquired, will be convertible at any time during the
specified conversion period into shares of the Company's Common Stock, par
value $1.00 per share, or may be senior Debt Securities which will not be
convertible. The Debt Securities may be offered as separate series in amounts,
at prices and on terms to be determined at the time of sale. Certain specific
terms of the particular Securities in respect of which this Prospectus is being
delivered are set forth in the accompanying Prospectus Supplement (the
"Prospectus Supplement"), including, where applicable, in the case of Debt
Securities, the title, aggregate principal amount, denominations (which may be
in United States dollars or in any other currency, in composite currencies or
in amounts determined by reference to an index), maturity, rate (which may be
fixed or variable) and time of payment of any interest, any terms for
redemption at the option of the Company or the holder, any terms for sinking
fund payments, any terms for conversion or exchange into other securities, any
listing on a securities exchange and the initial public offering price and any
other terms, in the case of Preferred Stock, the specific title, the aggregate
amount, any dividend (including the method of calculating payment of
dividends), liquidation, redemption, voting and other rights, any terms for any
conversion or exchange into other securities, the initial public offering price
and any other terms. The Company's Common Stock is listed on the New York,
Pacific and Philadelphia Stock Exchanges under the trading symbol "CI". Any
Common Stock sold pursuant to a Prospectus Supplement will be listed on such
exchanges, subject to official notice of issuance.
The Company may sell Securities to or through underwriters, directly to other
purchasers or through agents. The Prospectus Supplement sets forth the names of
any underwriters or agents involved in the sale of the Securities in respect of
which this Prospectus is being delivered, the proposed amounts, if any, to be
purchased by underwriters and the compensation, if any, of such underwriters or
agents.
-----------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
-----------
The date of this Prospectus is December 22, 1993.
<PAGE>
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "1934 Act"), and in accordance therewith
files reports, proxy statements and other information with the Securities and
Exchange Commission (the "Commission"). Such reports, proxy statements and
other information can be inspected and copied at the public reference
facilities maintained by the Commission at: Room 1024, 450 Fifth Street, N.W.,
Washington, D.C. 20549; Northwestern Atrium Center, 500 West Madison, Suite
1400, Chicago, Illinois 60661-2511; and 7 World Trade Center, 13th Floor, New
York, New York 10048; and copies of such material can be obtained from the
Public Reference Section of the Commission, Room 1024, 450 Fifth Street, N.W.,
Washington, D.C. 20549, at prescribed rates. Such reports, proxy statements
and other information can also be inspected at the offices of the New York
Stock Exchange, Inc., 20 Broad Street, New York, New York 10005; the Pacific
Stock Exchange, Inc., 115 Sansome Street, San Francisco, California 94104; and
the Philadelphia Stock Exchange, Inc., 1900 Market Street, 2nd Floor,
Philadelphia, Pennsylvania 19103.
The Company has filed with the Commission a registration statement on Form
S-3 (herein, together with all amendments and exhibits, referred to as the
"Registration Statement") under the Securities Act of 1933, as amended. This
Prospectus does not contain all of the information set forth in the
Registration Statement, certain parts of which are omitted in accordance with
the rules and regulations of the Commission. For further information,
reference is hereby made to the Registration Statement.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed with the Commission in accordance with the
provisions of the 1934 Act (File No. 1-8323) are incorporated by reference
herein: (1) the Company's Annual Report on Form 10-K for the fiscal year ended
December 31, 1992; (2) the Company's Quarterly Reports on Form 10-Q for the
fiscal quarters ended March 31, June 30 and September 30, 1993; and (3) the
Company's Current Reports on Form 8-K dated January 21, February 16, March 4,
March 31, May 3, August 2, November 1, November 19, December 14 and December
21, 1993. All reports subsequently filed by the Company pursuant to Section
13(a) or 13(c) of the 1934 Act, all definitive proxy or information statements
subsequently filed by the Company pursuant to Section 14 of the 1934 Act and
all reports subsequently filed pursuant to Section 15(d) of the 1934 Act prior
to the termination of this offering will be deemed to be incorporated herein
by reference and to be part hereof from the respective dates of filing of such
documents. Any statement contained in a document incorporated or deemed to be
incorporated by reference herein will be deemed to be modified or superseded
for purposes of this Prospectus to the extent that a statement contained
herein or in any other subsequently filed document which also is or is deemed
to be incorporated by reference herein modifies or supersedes such statement.
Any such statement so modified or superseded will not be deemed, except as so
modified or superseded, to constitute part of this Prospectus.
The Company hereby undertakes to provide without charge to each person,
including any beneficial owner, to whom this Prospectus is delivered, on the
request of such person, a copy of any and all of the documents incorporated
herein by reference (other than exhibits to such documents unless such
exhibits are specifically incorporated by reference into such documents).
Written or oral requests for such copies should be directed to CIGNA
Corporation, Shareholder Services Department, Two Liberty Place, 1601 Chestnut
Street, P.O. Box 7716, Philadelphia, Pennsylvania 19192-2378 (telephone (215)
761-3517).
2
<PAGE>
THE COMPANY
With shareholders' equity of $5.6 billion and assets of $82 billion as of
September 30, 1993, 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, in each case measured by total assets and revenues. Unless the
context otherwise indicates, the term "the Company," when used herein, refers
to one or more of CIGNA Corporation and its consolidated subsidiaries.
Although CIGNA Corporation is not itself an insurance company, its
subsidiaries are major providers of group life and health insurance, managed
care products and services, retirement products and services, individual
financial services, property and casualty insurance and asset management. The
Company is one of the largest international insurance organizations based in
the United States, measured by international revenues, and the largest
investor-owned health maintenance organization in the United States, measured
by number of enrollees. The Company's major insurance subsidiaries,
Connecticut General Life Insurance Company ("CG Life") and Insurance Company
of North America ("ICNA"), are among the oldest insurance companies in the
United States, with ICNA tracing its origins to 1792 and CG Life to 1865.
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.
RATIO OF EARNINGS TO FIXED CHARGES
The Company's ratio of earnings to fixed charges is incorporated by
reference to Exhibit 12 to the Company's Annual Report on Form 10-K for the
fiscal year ended December 31, 1992 and to Exhibit 12 to the Company's
quarterly report on Form 10-Q for the fiscal quarter ended September 30, 1993,
both incorporated by reference herein.
USE OF PROCEEDS
Except as may otherwise be set forth in the Prospectus Supplement, the net
proceeds from the sale of the Securities offered hereby will be added to the
Company's general funds and used for general corporate purposes.
DESCRIPTION OF DEBT SECURITIES
The following description of the terms of the Debt Securities sets forth
certain general terms and provisions of the Debt Securities to which any
Prospectus Supplement may relate. The particular terms of the Debt Securities
offered by any Prospectus Supplement (the "Offered Debt Securities"),
including the nature of any variations from the following general provisions
applicable to such Offered Debt Securities, will be described in the
Prospectus Supplement relating to such Offered Debt Securities.
The Debt Securities may be offered as Convertible Subordinated Debt
Securities which, unless previously redeemed or otherwise purchased or
acquired, will be convertible at any time during the specified conversion
period into shares of the Company's Common Stock, par value $1.00 per share,
or as Senior Debt Securities which will not be convertible. The Senior Debt
Securities are to be issued under an Indenture (the "Senior Indenture"),
between the Company and Marine Midland Bank, N.A., as Trustee (the "Senior
Trustee"), a copy of the form of which Senior Indenture is filed as an exhibit
to the Registration Statement. The Convertible Subordinated Debt Securities
are to be issued under an
3
<PAGE>
Indenture (the "Convertible Subordinated Indenture," each of the Senior
Indenture and the Convertible Subordinated Indenture being herein referred to
individually as an "Indenture" and collectively as the "Indentures") to be
entered into by the Company and Marine Midland Bank, N.A., as Trustee (the
"Convertible Subordinated Trustee," each of the Senior Trustee and the
Convertible Subordinated Trustee being herein referred to individually as a
"Trustee" and collectively as the "Trustees"), a copy of the form of which
Convertible Subordinated Indenture is filed as an exhibit to the Registration
Statement. The following summaries of certain provisions of the Indentures do
not purport to be complete and are subject to, and are qualified in their
entirety by reference to, all provisions of the applicable Indenture,
including the definitions therein of certain terms. Wherever particular
provisions or defined terms of the Indentures are referred to, such provisions
or defined terms are incorporated herein by reference. Certain defined terms
in the Indentures are capitalized herein. Unless specifically noted, the
references below to provisions, defined terms or sections of the Indentures
refer to both the Senior Indenture and the Convertible Subordinated Indenture.
GENERAL
The Indentures do not limit the amount of debentures, notes or other
evidences of indebtedness which may be issued thereunder (such securities
issued under either Indenture being herein referred to as the "Debt
Securities"). The Indentures provide that Debt Securities may be issued from
time to time in one or more series. The Debt Securities will be unsecured
obligations of the Company. The Senior Debt Securities will rank pari passu
with one another and with all other unsecured and unsubordinated debt of the
Company and will not be convertible. The Convertible Subordinated Debt
Securities will rank pari passu with one another and with the Company's 8.20%
Convertible Subordinated Debentures due July 10, 2010, will be subordinated to
all Senior Indebtedness of the Company as described below under "Convertible
Subordinated Debt Securities--Subordination" and will be convertible into the
Common Stock of the Company as described below under "Convertible Subordinated
Debt Securities--Conversion Rights."
The Prospectus Supplement relating to the Offered Debt Securities will state
whether the Offered Debt Securities are Senior Debt Securities or Convertible
Subordinated Debt Securities and will describe the following terms, where
applicable, of the Offered Debt Securities: (1) the title of the Offered Debt
Securities; (2) any limit on the aggregate principal amount of the Offered
Debt Securities; (3) the date or dates (or manner of determining the same) on
which the principal of the Offered Debt Securities is payable; (4) the rate or
rates (or manner of determining the same) at which the Offered Debt Securities
will bear interest, if any, the date or dates from which such interest will
accrue, the Interest Payment Dates on which such interest will be payable and
the Regular Record Date for the interest payable on any Interest Payment Date;
(5) if other than as set forth in this Prospectus, the place or places where
the principal of (and premium, if any) and interest on the Offered Debt
Securities will be payable; (6) the period or periods within which, the price
or prices at which, and the terms and conditions upon which the Offered Debt
Securities may be redeemed in whole or in part at the option of the Company;
(7) the obligation, if any, of the Company to redeem or purchase the Offered
Debt Securities pursuant to any sinking fund or analogous provisions or at the
option of a Holder thereof, and the period or periods within which, the price
or prices at which and the terms and conditions upon which the Offered Debt
Securities will be redeemed or purchased, in whole or in part, pursuant to
such obligation; (8) if other than denominations of $1,000 and any integral
multiple thereof, the denominations in which the Offered Debt Securities will
be issuable; (9) if other than the principal amount thereof, the portion of
the principal amount of the Offered Debt Securities which will be payable upon
declaration of acceleration of the Maturity thereof pursuant to Section 502;
(10) if other than the currency of the United States of America, the currency
or currencies, including composite currencies, in which payment of the
principal of (and premium, if any) and interest on the Offered Debt Securities
will be payable; (11) if the amount of payments of principal of (and premium,
if any) or interest on the Offered Debt Securities may be determined with
reference to an index, the manner in which such amounts will be determined;
and (12) any other terms of the Offered Debt Securities. Additionally, the
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Prospectus Supplement with respect to any Convertible Subordinated Offered
Debt Securities will set forth the Initial Conversion Price, the Initial
Conversion Date and the Final Conversion Date therefor and any other terms
relating to the conversion thereof into Common Stock of the Company. The
Prospectus Supplement with respect to any Senior Offered Debt Securities will
describe the application, if any, of Section 403 or Section 1007 of the Senior
Indenture thereto. (Section 301).
Unless otherwise indicated in the Prospectus Supplement, principal of and
premium, if any, and interest, if any, on the Offered Debt Securities will be
payable, transfers of the Offered Debt Securities will be registrable, and
Convertible Subordinated Offered Debt Securities may be surrendered for
conversion, at Marine Midland Bank, N.A., 140 Broadway, New York, New York
10015, provided that at the option of the Company payment of interest may be
made by check mailed to the address of the Person entitled thereto as it
appears in the Security Register. (Sections 301, 305, 307 and 1002).
In any case where the date on which the principal of and premium, if any,
and interest, if any, on the Offered Debt Securities is payable, or which is
the last day any Convertible Subordinated Offered Debt Securities may be
converted, is not a Business Day at any Place of Payment for such Offered Debt
Securities, or at any place where Convertible Subordinated Offered Debt
Securities may be surrendered for conversion, then (notwithstanding any other
provision of the applicable Indenture or of such Offered Debt Securities)
payment of such principal, premium or interest, or conversion of such
Convertible Subordinated Offered Debt Securities, need not be made at such
Place of Payment, or place where Convertible Subordinated Offered Debt
Securities may be surrendered for conversion, on such date, but may be made on
the next succeeding Business Day at such Place of Payment, or place where
Convertible Subordinated Offered Debt Securities may be surrendered for
conversion, provided that no interest shall accrue for the period from and
after the date on which such principal, premium or interest is payable.
(Section 113).
Unless otherwise indicated in the Prospectus Supplement, the Offered Debt
Securities will be issued only in fully registered form without coupons in
denominations of $1,000 or any integral multiple thereof. (Section 302). No
service charge will be made for any registration of transfer or exchange of
Offered Debt Securities, but the Company may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith. (Section 305).
Debt Securities may be issued under the Indentures as Original Issue
Discount Securities to be sold at a substantial discount below their principal
amount. If such Securities are issued, the material federal income tax and
other considerations applicable thereto will be described in the Prospectus
Supplement relating to any Original Issue Discount Securities.
EVENTS OF DEFAULT
The following are Events of Default under each Indenture with respect to
Debt Securities of any series issued under such Indenture: (a) failure to pay
principal of or premium, if any, on any Debt Security of that series when due;
(b) failure to pay any interest on any Debt Security of that series when due,
continued for 30 days; (c) failure to deposit any sinking fund payment, when
due, in respect of any Debt Security of that series; (d) failure to perform
any other covenant of the Company in such Indenture (other than a covenant
included in such Indenture solely for the benefit of series of Debt Securities
other than that series), continued for 90 days after written notice as
provided in such Indenture; (e) 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 such Indenture; (f) certain
events in bankruptcy, insolvency or reorganization in respect of the Company;
and (g) any other Event of Default provided with respect to Debt Securities of
that series. (Section 501).
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If an Event of Default with respect to Debt Securities of any series at the
time Outstanding occurs and is continuing, either the Trustee for such Debt
Securities or the Holders of at least 25 percent in principal amount of the
Outstanding Debt Securities of that series may declare the principal amount
(or, if the Debt Securities of that series are Original Issue Discount
Securities, such portion of the principal amount as may be specified in the
terms of that series) of all the Debt Securities of that series to be due and
payable immediately. At any time after a declaration of acceleration with
respect to Debt Securities of any series 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 Outstanding Debt Securities of that series may,
under certain circumstances, rescind and annul such acceleration. (Section
502). For information as to waiver of defaults, see "Modification and Waiver."
Neither Trustee will be under any obligation, subject to the duty of each
Trustee during default to act with the required standard of care, to exercise
any of its rights or powers under the Indenture to which such Trustee is a
party at the request or direction of any of the Holders of Debt Securities
issued under such Indenture, unless such Holders shall have offered to such
Trustee reasonable security or indemnity. Subject to such provisions for
indemnification of the applicable Trustee, the Holders of a majority in
principal amount of the Outstanding Debt Securities of any series will have
the right to direct the time, method and place of conducting any proceeding
for any remedy available to such Trustee, or exercising any trust or power
conferred on such Trustee, with respect to the Debt Securities of that series.
The Company will furnish to each Trustee annually a certificate as to
compliance with all conditions and covenants under the Indenture to which such
Trustee is a party.
MODIFICATION AND WAIVER
Modifications and amendments of either Indenture may be made by the Company
and the Trustee under such Indenture with the consent of the Holders of not
less than 66 2/3 percent in principal amount of the Outstanding Debt
Securities of each series issued under such Indenture affected by such
modification or amendment; provided, however, that no such modification or
amendment may, without the consent of the Holder of each Outstanding Debt
Security issued under such Indenture affected thereby, (a) change the Stated
Maturity of the principal of, or any installment of principal of or interest
on, any Debt Security, (b) reduce the principal amount of, or the premium, if
any, or the rate of interest on, any Debt Security, (c) reduce the amount of
principal of an Original Issue Discount Security payable upon acceleration of
the Maturity thereof, (d) change the place or currency of payment of principal
of, or premium, if any, or the rate of interest on, any Debt Security, (e)
impair the right to institute suit for the enforcement of any payment on or
with respect to any Debt Security, (f) adversely affect the right to convert
any Convertible Subordinated Debt Security or modify the provisions of the
Convertible Subordinated Indenture with respect to the subordination of the
Convertible Subordinated Debt Securities in a manner adverse to the Holders
thereof, or (g) reduce the percentage in principal amount of Outstanding Debt
Securities of any series, or the percentage of Holders the consent of which is
required for modification or amendment of the Indenture for such Debt
Securities or for waiver of compliance with certain provisions of such
Indenture or for waiver of certain defaults. (Section 902).
Each Indenture provides that the Holders of a majority in principal amount
of the Outstanding Debt Securities of any series may, on behalf of the Holders
of all Debt Securities of that series, waive any past default under such
Indenture with respect to that series, except a default in the payment of the
principal of or premium, if any, or interest on any Debt Security of that
series or in respect of a provision which under such Indenture cannot be
modified or amended without the consent of the Holder of each Outstanding Debt
Security of that series affected. (Section 513).
The Senior Indenture (but not the Convertible Subordinated Indenture)
provides that the Holders of not less than a majority in principal amount of
the Outstanding Senior Debt Securities of any series
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may, on behalf of the Holders of all Senior Debt Securities of that series,
waive, insofar as that series is concerned, compliance by the Company with
certain restrictive provisions of the Senior Indenture. (Section 1009).
CONSOLIDATION, MERGER AND SALE OF ASSETS
The Company may, without the consent of any Holders of Outstanding Debt
Securities, 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 Debt
Securities and under each Indenture, and (in the case of the Convertible
Subordinated Indenture) provides for conversion rights for the Convertible
Subordinated Debt Securities, (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.
(Sections 801 and 802).
CONCERNING THE TRUSTEES
The Company and certain of its subsidiaries in the ordinary course of
business maintain general banking relations with Marine Midland Bank, N.A.
Pursuant to the provisions of the Trust Indenture Act of 1939, upon a default
under either the Senior Indenture or the Convertible Subordinated Indenture,
Marine Midland Bank, N.A. may be deemed to have a conflicting interest by
virtue of its acting as both the Senior Trustee and the Convertible
Subordinated Trustee requiring it to resign and be replaced by a successor
trustee in one of such positions.
SENIOR DEBT SECURITIES
The following provisions apply only to Senior Debt Securities and not to
Convertible Subordinated Debt Securities.
BOOK-ENTRY DEBT SECURITIES
The Senior Offered Debt Securities may be issued in the form of one or more
Global Securities that will be deposited with a Depository or its nominee
identified in the Prospectus Supplement relating to such Senior Offered Debt
Securities. In such a case, one or more Global Securities will be issued in a
denomination or aggregate denominations equal to the portion of the aggregate
principal amount of Outstanding Debt Securities of the series to be
represented by such Global Security or Securities. Unless and until it is
exchanged in whole or in part for Debt Securities in definitive registered
form, a Global Security may not be registered for transfer or exchange except
as a whole by the Depository for such Global Security to a nominee of such
Depository and except in the circumstances described in the Prospectus
Supplement relating to such Senior Offered Debt Securities. (Sections 205 and
305).
The specific terms of the depository arrangement with respect to any portion
of a series of Senior Offered Debt Securities to be represented by a Global
Security will be described in the Prospectus Supplement relating to such
Senior Offered Debt Securities.
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LIMITATION ON LIENS
The Senior 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 Senior Debt Securities and,
if the Company so elects, any other indebtedness of the Company ranking at
least pari passu with the Senior Debt Securities, shall be secured equally and
ratably with, or prior to, such other secured indebtedness for money borrowed
so long as it is outstanding. (Section 1006).
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 Senior Debt Securities in the event the
Company or any Subsidiary finds it necessary to obtain financing secured by
the common stock of a Designated Subsidiary.
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 it remains a Subsidiary, or any
Subsidiary which is a successor of such Designated Subsidiary. (Section 101).
DEFEASANCE
Defeasance and Discharge. The Senior Indenture provides, if such provision
is made applicable to the Senior Debt Securities of any series pursuant to
Section 301 of the Senior Indenture, that the Company will be discharged from
any and all obligations in respect of the Senior Debt Securities of such
series (except for certain obligations to register the transfer or exchange of
Senior Debt Securities of such series, to replace stolen, lost or mutilated
Senior Debt Securities of such series, to maintain paying agencies and to hold
monies for payment in trust) upon the deposit with the Senior 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 Senior Debt Securities of such series on
the Stated Maturity of such payments and any mandatory sinking fund payments
or analogous payments applicable to the Senior Debt Securities of such series
on the day on which such payments are due and payable in accordance with the
terms of the Senior Indenture and the Senior Debt Securities of such series.
Such a trust may only be established if, among other things, (i) either (x)
the Company has delivered to the Senior Trustee an Opinion of Counsel to the
effect that since the date of the Senior 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 Senior Debt Securities of such series 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 Senior Trustee an Opinion of Counsel
to the effect that the Senior Debt Securities of such series, if then listed
on the
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New York Stock Exchange, will not be delisted as a result of such deposit,
defeasance and discharge. (Section 403).
Defeasance of Certain Obligations and Certain Events of Default. The Senior
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 (d) under "Events of
Default") with respect to Sections 1005 and 1006 and Section 501(5) (described
in Clause (e) under "Events of Default") shall be deemed not to be an Event of
Default under the Senior Indenture with respect to the Senior Debt Securities
of any series, upon the deposit with the Senior 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 Senior Debt Securities of such series on the
Stated Maturity of such payments and any mandatory sinking fund payments or
analogous payments applicable to the Senior Debt Securities of such series on
the day on which such payments are due and payable in accordance with the
terms of the Senior Indenture and the Senior Debt Securities of such series.
The obligations of the Company under the Senior Indenture and the Senior Debt
Securities of such series 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 Senior
Trustee an Opinion of Counsel to the effect that (i) the Holders of the Senior
Debt Securities of such series 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 Senior Debt Securities of such series, if then listed on the New
York Stock Exchange, will not be delisted as a result of such deposit and
defeasance. (Section 1007).
In the event the Company exercises its option to omit compliance with
certain covenants of the Senior Indenture with respect to the Senior Debt
Securities of any series as described above and the Senior Debt Securities of
such series are declared due and payable because of the occurrence of any
Event of Default other than an Event of Default described in Clause (d) or (e)
under "Events of Default," the amount of money and U.S. Government Obligations
on deposit with the Senior Trustee, or another qualified corporate trustee,
will be sufficient to pay amounts due on the Senior Debt Securities of such
series at the time of their Stated Maturity but may not be sufficient to pay
amounts due on the Senior Debt Securities of such series 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 Senior Indenture, the Senior 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. (Section 503).
CONVERTIBLE SUBORDINATED DEBT SECURITIES
The following provisions apply only to Convertible Subordinated Debt
Securities and not to Senior Debt Securities.
SUBORDINATION
The payment of the principal of and premium, if any, and interest on the
Convertible Subordinated Debt Securities will, to the extent set forth in the
Convertible Subordinated Indenture, be subordinated in right of payment to the
prior payment in full of all Senior Indebtedness (as defined below). Upon any
payment or distribution of assets to creditors upon any liquidation,
dissolution, winding up, reorganization, assignment for the benefit of
creditors, marshalling of assets or any bankruptcy, insolvency or similar
proceedings of the Company, the holders of all Senior Indebtedness will first
be
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entitled to receive payment in full of all amounts due or to become due
thereon before the Holders of the Convertible Subordinated Debt Securities
will be entitled to receive any payment in respect of the principal of or
premium, if any, or interest on the Convertible Subordinated Debt Securities.
In the event of the acceleration of the maturity of any Convertible
Subordinated Debt Securities, the holders of all Senior Indebtedness will
first be entitled to receive payment in full of all amounts due or to become
due thereon before the Holders of the Convertible Subordinated Debt Securities
will be entitled to receive any payment upon the principal of or premium, if
any, or interest on the Convertible Subordinated Debt Securities. No payments
on account of principal, premium, if any, or interest in respect of the
Convertible Subordinated Debt Securities may be made if there shall have
occurred and be continuing a default in any payment with respect to Senior
Indebtedness, or an event of default with respect to any Senior Indebtedness
permitting the holders thereof to accelerate the maturity thereof, or if any
judicial proceeding shall be pending with respect to any such default. For
purposes of the subordination provisions, the payment, issuance or delivery of
cash, property or securities (other than stock, and certain subordinated
securities, of the Company) upon conversion of a Convertible Subordinated Debt
Security will be deemed to constitute payment on account of the principal of
such Convertible Subordinated Debt Security. (Article Thirteen)
By reason of such subordination, in the event of insolvency, creditors of
the Company who are not holders of Senior Indebtedness or of the Convertible
Subordinated Debt Securities may recover less, ratably, than holders of Senior
Indebtedness, and may recover more, ratably, than the Holders of the
Convertible Subordinated Debt Securities.
"Senior Indebtedness" is defined to mean the principal of (and premium, if
any) and interest on all indebtedness of the Company (including indebtedness
of others guaranteed by the Company), other than the Convertible Subordinated
Debt Securities and the Company's 8.20% Convertible Subordinated Debentures
due July 10, 2010, whether outstanding on the date of the Convertible
Subordinated Indenture or thereafter created, incurred or assumed, which is:
(i) for money borrowed, (ii) evidenced by a note or similar instrument given
in connection with the acquisition of any businesses, properties or assets of
any kind or (iii) obligations of the Company as lessee under leases required
to be capitalized on the balance sheet of the lessee under generally accepted
accounting principles or leases of property or assets made as part of any sale
and lease-back transaction to which the Company is a party, including
amendments, renewals, extensions, modifications and refundings of any such
indebtedness or obligation, unless in any case in the instrument creating or
evidencing any such indebtedness or obligation or pursuant to which the same
is outstanding it is provided that such indebtedness or obligation is not
superior in right of payment to the Convertible Subordinated Debt Securities.
At November 30, 1993, Senior Indebtedness aggregated approximately $1.4
billion. The Company expects from time to time to incur additional
indebtedness constituting Senior Indebtedness. The Convertible Subordinated
Indenture does not prohibit or limit the incurrence of additional Senior
Indebtedness.
CONVERSION RIGHTS
The Convertible Subordinated Debt Securities will be convertible into Common
Stock of the Company prior to redemption during the time period specified in
the Prospectus Supplement with respect thereto, initially at the Initial
Conversion Price therefor specified in such Prospectus Supplement. The right
to convert Convertible Subordinated Debt Securities subject to and called for
redemption will terminate at the close of business on the Redemption Date and
will be lost if not exercised prior to that time. (Section 1401)
The conversion price will be subject to adjustment in certain events,
including (i) dividends (and other distributions) payable in Common Stock on
any class of capital stock of the Company, (ii) the issuance to all holders of
Common Stock of rights or warrants entitling them to subscribe for or
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purchase Common Stock at less than the current market price (as defined),
(iii) subdivisions, combinations and reclassifications of Common Stock, and
(iv) distributions to all holders of Common Stock of evidences of indebtedness
of the Company or assets (including securities, but excluding those dividends,
rights, warrants and distributions referred to above and dividends and
distributions paid in cash out of the retained earnings of the Company). In
addition to the foregoing adjustments, the Company will be permitted to make
such reductions in the conversion price as it considers to be advisable in
order that any event treated for Federal income tax purposes as a dividend of
stock or stock rights will not be taxable to the holders of the Common Stock.
(Section 1404) In case of certain consolidations or mergers to which the
Company is a party or the transfer of substantially all of the assets of the
Company, each Convertible Subordinated Debt Security then outstanding would,
without the consent of any Holders of such Convertible Subordinated Debt
Security, become convertible only into the kind and amount of securities, cash
and other property receivable upon the consolidation, merger or transfer by a
holder of the number of shares of Common Stock into which such Convertible
Subordinated Debt Security might have been converted immediately prior to such
consolidation, merger or transfer (assuming such holder of Common Stock failed
to exercise any rights of election and received per share the kind and amount
received per share by a plurality of non-electing shares). (Section 1411)
Fractional shares of Common Stock are not to be issued upon conversion, but,
in lieu thereof, the Company will pay a cash adjustment based upon market
price (as determined by the Board of Directors). (Section 1403) Convertible
Subordinated Debt Securities surrendered for conversion during the period from
the close of business on any Regular Record Date next preceding any Interest
Payment Date to the opening of business on such Interest Payment Date (except
Convertible Subordinated Debt Securities called for redemption on a Redemption
Date within such period) must be accompanied by payment of an amount equal to
the interest thereon which the registered Holder is to receive. If any
Convertible Subordinated Debt Security is converted after any Regular Record
Date and on or prior to the next succeeding Interest Payment Date (other than
any Convertible Subordinated Debt Security whose Maturity is prior to such
Interest Payment Date), interest whose Stated Maturity is on such Interest
Payment Date shall be payable on such Interest Payment Date notwithstanding
such conversion, and such interest (whether or not punctually paid or duly
provided for) shall be paid to the Person in whose name that Convertible
Subordinated Debt Security (or one or more Predecessor Securities) is
registered at the close of business on such Regular Record Date. Except where
Convertible Subordinated Debt Securities surrendered for conversion must be
accompanied by payment as described above, no interest on converted
Convertible Subordinated Debt Securities will be payable by the Company on any
Interest Payment Date subsequent to the date of conversion. No other payment
or adjustment for interest or dividends is to be made upon conversion.
(Sections 307 and 1402)
If at any time the Company makes a distribution of property to its
stockholders which would be taxable to such stockholders as a dividend for
Federal income tax purposes (e.g., distributions of evidences of indebtedness
or assets of the Company, but generally not stock dividends or rights to
subscribe for Common Stock) and, pursuant to the anti-dilution provisions of
the Convertible Subordinated Indenture, the conversion price of the
Convertible Subordinated Debt Securities is reduced, such reduction may be
deemed to be the payment of a taxable dividend to holders of Convertible
Subordinated Debt Securities.
DESCRIPTION OF PREFERRED STOCK
The following is a description of certain general terms and provisions of
the Preferred Stock. The particular terms of any series of Preferred Stock
will be described in the applicable Prospectus Supplement. If so indicated in
a Prospectus Supplement, the terms of any such series may differ from
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the terms set forth below. Certain provisions applicable to the Preferred
Stock are set forth below in "Description of Common Stock."
The summary of terms of the Company's Preferred Stock contained in this
Prospectus does not purport to be complete and is subject to, and qualified in
its entirety by, the provisions of the Company's Certificate of Incorporation
and the certificate of designation relating to each series of the Preferred
Stock (the "Certificate of Designation"), which will be filed as an exhibit to
or incorporated by reference in the Registration Statement of which this
Prospectus is a part at or prior to the time of issuance of such series of the
Preferred Stock.
The Company's Certificate of Incorporation authorizes the issuance of
25,000,000 shares of preferred stock, par value $1.00 per share. No shares of
preferred stock are outstanding as of the date of this Prospectus, but the
Company has reserved for issuance 2,000,000 shares of its Junior Participating
Preferred Stock, Series D issuable pursuant to the Company's shareholder
rights plan, a description of which has been incorporated by reference herein.
The Company's Preferred Stock may be issued from time to time in one or more
series, without shareholder approval, when authorized by the Board of
Directors. Subject to limitations prescribed by law, the Board of Directors is
authorized to determine the voting powers (if any), designation, preferences
and relative, participating, optional or other special rights, and
qualifications, limitations or restrictions thereof, for each series of
preferred stock that may be issued, and to fix the number of shares of each
such series. Thus, the Board of Directors, without shareholder approval, could
authorize the issuance of preferred stock with voting, conversion and other
rights that could adversely affect the voting power and other rights of
holders of Common Stock or other series of preferred stock or that could have
the effect of delaying, deferring or preventing a change in control of the
Company. For example, the Company could issue a class or classes of preferred
stock the provisions of which would not protect the holders thereof with
respect to redemption premiums in the event of certain mergers or other
changes of control or provide the holders thereof an opportunity to vote as a
class with respect to certain changes of control.
The Preferred Stock shall have the dividend, liquidation, redemption and
voting rights set forth below unless otherwise described in a Prospectus
Supplement relating to a particular series of the Preferred Stock. The
applicable Prospectus Supplement will describe the following terms of the
series of Preferred Stock in respect of which this Prospectus is being
delivered: (1) the designations and stated value per share, if any, of such
Preferred Stock and the number of shares offered; (2) the amount of
liquidation preference per share; (3) the initial public offering price at
which such Preferred Stock will be issued; (4) the dividend rate (or method of
calculation), the dates on which dividends shall be payable and the dates from
which dividends shall commence to cumulate, if any; (5) any redemption or
sinking fund provisions; (6) any conversion or exchange rights; and (7) any
additional voting, dividend, liquidation, redemption, sinking fund and other
rights, preferences, privileges, limitations and restrictions.
GENERAL
The Preferred Stock offered hereby will be issued in one or more series.
Shares of Preferred Stock, upon issuance against full payment of the purchase
price therefor, will be fully paid and nonassessable. Neither the par value
nor the liquidation preference is indicative of the price at which the
Preferred Stock will actually trade on or after the date of issuance. The
Prospectus Supplement will contain, if applicable, a description of certain
United States Federal income tax consequences relating to the purchase and
ownership of the series of Preferred Stock offered by such Prospectus
Supplement.
RANK
The Preferred Stock shall, with respect to dividend rights and rights upon
liquidation, winding up and dissolution of the Company, rank prior to the
Company's Common Stock and to all other classes
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and series of equity securities of the Company now or hereafter authorized,
issued or outstanding (the Common Stock and such other classes and series of
equity securities collectively may be referred to herein as the "Junior
Stock"), other than any classes or series of equity securities of the Company
ranking on a parity with (the "Parity Stock") or senior to (the "Senior
Stock") the Preferred Stock as to dividend rights and rights upon liquidation,
winding up or dissolution of the Company. The Preferred Stock shall be junior
to all outstanding debt of the Company. The Preferred Stock shall be subject
to creation of Senior Stock, Parity Stock and Junior Stock to the extent not
expressly prohibited by the Company's Certificate of Incorporation.
DIVIDENDS
Holders of shares of Preferred Stock shall be entitled to receive, when, as
and if declared by the Board of Directors out of funds of the Company legally
available for payment, cash dividends, payable at such dates and at such rates
per share per annum as described in the applicable Prospectus Supplement. Such
rate may be fixed or variable or both. Each declared dividend shall be payable
to holders of record as they appear at the close of business on the stock
books of the Company on such record dates, not more than 60 calendar days
preceding the payment dates therefor, as are determined by the Board of
Directors (each of such dates, a "Record Date").
Such dividends may be cumulative or noncumulative, as described in the
applicable Prospectus Supplement. If dividends on a series of Preferred Stock
are noncumulative and if the Board of Directors fails to declare a dividend in
respect of a dividend period with respect to such series, then holders of such
Preferred Stock will have no right to receive a dividend in respect of such
dividend period, and the Company will have no obligation to pay the dividend
for such period, whether or not dividends are declared payable on any future
dividend payment dates.
No full dividends shall be declared or paid or set apart for payment on
preferred stock of the Company of any series ranking, as to dividends, on a
parity with or junior to the series of Preferred Stock offered by the
applicable Prospectus Supplement for any period unless full dividends for the
immediately preceding dividend period on such Preferred Stock (including any
accumulation in respect of unpaid dividends for prior dividend periods, if
dividends on such Preferred Stock are cumulative) have been or
contemporaneously are declared and paid or declared and a sum sufficient for
the payment thereof is set apart for such payment. When dividends are not so
paid in full (or a sum sufficient for such full payment is not so set apart)
upon such Preferred Stock and any other preferred stock of the Company ranking
on a parity as to dividends with the Preferred Stock, dividends upon shares of
such Preferred Stock and dividends on such other preferred stock shall be
declared pro rata so that the amount of dividends declared per share on such
Preferred Stock and such other preferred stock shall in all cases bear to each
other the same ratio that accrued dividends for the then-current dividend
period per share on the shares of such Preferred Stock (including any
accumulation in respect of unpaid dividends for prior dividend periods, if
dividends on such Preferred Stock are cumulative) and accrued dividends,
including required or permitted accumulations, if any, on shares of such other
preferred stock, bear to each other.
CONVERTIBILITY
The terms, if any, on which shares of Preferred Stock of any series may be
exchanged for or converted (mandatorily or otherwise) into shares of Common
Stock of the Company or another series of Preferred Stock or other securities
of the Company will be set forth in the applicable Prospectus Supplement. See
"Description of Common Stock."
REDEMPTION
The terms, if any, on which shares of Preferred Stock of any series may be
redeemed will be set forth in the applicable Prospectus Supplement.
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<PAGE>
LIQUIDATION
In the event of a voluntary or involuntary liquidation, dissolution or
winding up of the affairs of the Company, the holders of a series of Preferred
Stock will be entitled, subject to the rights of creditors, but before any
distribution or payment to the holders of Common Stock or any other security
ranking junior to the Preferred Stock on liquidation, dissolution or winding
up of the Company, to receive an amount per share as set forth in the
applicable Prospectus Supplement plus accrued and unpaid dividends for the
then-current dividend period (including any accumulation in respect of unpaid
dividends for prior dividend periods, if dividends on such series of Preferred
Stock are cumulative). If the amounts available for distribution with respect
to the Preferred Stock and all other outstanding stock of the Company ranking
on a parity with the Preferred Stock upon liquidation are not sufficient to
satisfy the full liquidation rights of all the outstanding Preferred Stock and
stock ranking on a parity therewith, then the holders of each series of such
stock will share ratably in any such distribution of assets in proportion to
the full respective preferential amount (which in the case of preferred stock
may include accumulated dividends) to which they are entitled. After payment
of the full amount of the liquidation preference, the holders of shares of
Preferred Stock will not be entitled to any further participation in any
distribution of assets by the Company.
VOTING
The Preferred Stock of a series will not be entitled to vote, except as
described below or in the applicable Prospectus Supplement and as required by
applicable law. Without the affirmative vote of a majority of the shares of
Preferred Stock then outstanding (voting separately as a class together with
any Parity Stock), the Company may not (i) increase or decrease the aggregate
number of authorized shares of such class, (ii) increase or decrease the par
value of the shares of such class, or (iii) alter or change the powers,
preferences or special rights of the shares of such class so as to affect them
adversely.
NO OTHER RIGHTS
The shares of a series of Preferred Stock will not have any preferences,
voting powers or relative, participating, optional or other special rights
except as set forth above or in the applicable Prospectus Supplement, the
Certificate of Incorporation and in the applicable Certificate of Designation
or as otherwise required by law.
TRANSFER AGENT AND REGISTRAR
The transfer agent for each series of Preferred Stock will be described in
the related Prospectus Supplement.
DESCRIPTION OF COMMON STOCK
The Company is authorized to issue 200,000,000 shares of Common Stock, par
value $1.00 per share, of which 72,008,415 shares were issued and outstanding
at November 30, 1993. The Common Stock is listed on the New York, Pacific and
Philadelphia Stock Exchanges. The Company will use its best efforts to list on
the New York Stock Exchange any Common Stock to be offered by the Prospectus
Supplement attached hereto.
Holders of Common Stock are entitled to receive such dividends as the Board
of Directors of the Company may from time to time declare. Payment of
dividends on the Common Stock will at all times be subject to, among other
things, prior satisfaction of dividend and sinking fund requirements, if any,
of any series of preferred stock that may then be outstanding, and the
availability of funds to the Company, which in turn may be subject to fixed
payment obligations which the Company may incur in
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<PAGE>
the future, and the ability of the Company's insurance subsidiaries to declare
and pay dividends under applicable insurance regulatory requirements. No
shares of preferred stock are outstanding as of the date of this Prospectus.
The Company's Board of Directors is divided into three classes, each elected
for a term of three years. Directors may be removed only for cause. Holders of
Common Stock have one vote per share and have no cumulative voting rights.
Subject to the rights of creditors and the liquidation preferences of holders
of preferred stock, the holders of Common Stock are entitled to share ratably
in the remaining assets of the Company in the event of its voluntary or
involuntary liquidation or dissolution. Holders of Common Stock have no
preemptive rights. All shares of Common Stock presently outstanding are, and
all such shares to be offered by the Prospectus Supplement attached hereto
will be, fully paid and nonassessable.
Under the Company's shareholder rights plan, a Preferred Stock Purchase
Right (a "Right") attaches to each outstanding share of Common Stock. The
Rights trade with the Common Stock until the Rights become exercisable. They
are exercisable only if a party acquires, or announces a tender offer to
acquire, 20% or more of the outstanding Common Stock. Each Right entitles the
shareholder to buy, for a $200 exercise price, 1/100 of a share of Junior
Participating Preferred Stock, Series D, having dividend and voting rights
approximately equal to one share of Common Stock. Under certain circumstances,
including the acquisition of 20% or more of the outstanding Common Stock by an
acquirer, all Rights holders except the acquirer may purchase shares of Common
Stock worth twice the exercise price. If the Company is acquired in a merger
after the acquisition of 20% of outstanding Common Stock, Rights holders may
purchase the acquirer's shares at a similar discount. The Company may redeem
the Rights for five cents each at any time before an acquirer acquires 20% of
its outstanding Common Stock, and thereafter under certain circumstances.
Certain mergers and other business combinations must be approved by holders
of at least 80 percent of the outstanding Common Stock and any preferred stock
entitled to vote generally, voting together as a single class, except where
the transaction is approved by a majority of the Company's Board of Directors,
or certain minimum price criteria and procedural conditions are met as
specified in the Company's Restated Certificate of Incorporation. A similar 80
percent vote of the outstanding Common Stock and any preferred stock entitled
to vote generally, voting together as a single class, is required for the
Company's shareholders to amend, repeal or adopt any charter provision
inconsistent with such provisions or to adopt, amend or repeal the Company's
by-laws. Such provisions could inhibit a change of control in situations that
the Board of Directors determines are not adequate or in the best interests of
shareholders, or that do not meet specified fair price criteria and procedural
conditions. In some circumstances, some or all shareholders could be denied
the opportunity to realize a premium over the then-prevailing market price for
the shares.
The Transfer Agent and Registrar for the Common Stock is First Chicago Trust
Company of New York.
PLAN OF DISTRIBUTION
General. The Company may sell Securities to or through underwriters or
agents, directly to other purchasers, to both investors and dealers through a
specific bidding or auction process or otherwise, or through a combination of
any such methods of sale. If a bidding or auction process is used, it will be
described in the Prospectus Supplement.
The distribution of the Securities may be effected from time to time in one
or more transactions at a fixed price or prices, which may be changed, at
market prices prevailing at the time of sale, at prices related to such
prevailing market prices or at negotiated prices.
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<PAGE>
In connection with the sale of Securities, underwriters may receive
compensation from the Company or from purchasers of Securities for whom they
may act as agents in the form of discounts, concessions or commissions.
Underwriters may sell Securities to or through dealers and such dealers may
receive compensation in the form of discounts, concessions or commissions from
the underwriters and/or commissions from the purchasers for whom they may act
as agent. Underwriters, dealers and agents that participate in the
distribution of Securities may be deemed to be underwriters, and any discounts
or commissions received by them from the Company and any profit on the resale
of Securities by them may be deemed to be underwriting discounts and
commissions under the Securities Act of 1933, as amended (the "Act"). Any such
underwriter or agent will be identified, and any such compensation received
from the Company will be described in the Prospectus Supplement.
Under agreements which may be entered into by the Company, underwriters and
agents who participate in the distribution of Securities may be entitled to
indemnification by the Company against certain liabilities, including
liabilities under the Act.
Delayed Delivery Arrangements. If so indicated in the Prospectus Supplement,
the Company will authorize underwriters or other persons acting as the
Company's agents to solicit offers by certain institutions to purchase
Securities from the Company pursuant to contracts providing for payment and
delivery on a future date. Institutions with which such contracts may be made
include commercial and savings banks, insurance companies, pension funds,
investment companies, educational and charitable institutions and others, but
in all cases such institutions must be approved by the Company. The
obligations of any purchaser under any such contract will be subject to the
condition that the purchase of the Securities shall not at the time of
delivery be prohibited under the laws of the jurisdiction to which such
purchaser is subject. The underwriters and such other agents will not have any
responsibility in respect of the validity or performance of such contracts.
VALIDITY OF SECURITIES
Unless otherwise indicated in a Prospectus Supplement, the validity of the
Securities offered hereby will be passed upon for the Company by Schnader,
Harrison, Segal & Lewis, 1600 Market Street, Philadelphia, Pennsylvania 19103,
and for the underwriters or agents by Sullivan & Cromwell, 125 Broad Street,
New York, New York 10004.
EXPERTS
The consolidated financial statements and financial statement schedules of
CIGNA Corporation as of December 31, 1992 and 1991 and for each of the three
years in the period ended December 31, 1992 incorporated herein by reference
to the Current Report on Form 8-K of the Company dated December 14, 1993 have
been so incorporated in reliance on the reports of Price Waterhouse,
independent accountants, given on the authority of said firm as experts in
auditing and accounting.
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NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS SUPPLEMENT OR
THE PROSPECTUS, AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS
MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED. THIS PROSPECTUS SUPPLEMENT
AND THE PROSPECTUS DO NOT CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF
AN OFFER TO BUY ANY SECURITIES OTHER THAN THE SECURITIES DESCRIBED IN THIS
PROSPECTUS SUPPLEMENT OR AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO
BUY SUCH SECURITIES IN ANY CIRCUMSTANCES IN WHICH SUCH OFFER OR SOLICITATION
IS UNLAWFUL. NEITHER THE DELIVERY OF THIS PROSPECTUS SUPPLEMENT OR THE
PROSPECTUS NOR ANY SALE MADE HEREUNDER OR THEREUNDER SHALL, UNDER ANY
CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE
AFFAIRS OF THE COMPANY SINCE THE DATE HEREOF OR THAT INFORMATION CONTAINED
HEREIN OR THEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO ITS DATE.
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TABLE OF CONTENTS
PROSPECTUS SUPPLEMENT
<TABLE>
<CAPTION>
PAGE
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<S> <C>
The Company................................................................ S-3
Ratio of Earnings to Fixed Charges......................................... S-3
Use of Proceeds............................................................ S-3
Capitalization............................................................. S-4
Selected Financial Information............................................. S-5
Recent Developments........................................................ S-6
Business................................................................... S-7
Description of Notes and Debentures........................................ S-15
Underwriting............................................................... S-18
Validity of Notes and Debentures........................................... S-19
Experts.................................................................... S-19
PROSPECTUS
Available Information...................................................... 2
Incorporation of Certain Documents by Reference............................ 2
The Company................................................................ 3
Ratio of Earnings to Fixed Charges......................................... 3
Use of Proceeds............................................................ 3
Description of Debt Securities............................................. 3
Senior Debt Securities..................................................... 7
Convertible Subordinated Debt Securities................................... 9
Description of Preferred Stock............................................. 11
Description of Common Stock................................................ 14
Plan of Distribution....................................................... 15
Validity of Debt Securities................................................ 16
Experts.................................................................... 16
</TABLE>
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$600,000,000
CIGNA CORPORATION
$
% NOTES DUE MAY , 2007
$
% DEBENTURES DUE MAY , 2027
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(R)
LOGO
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GOLDMAN, SACHS & CO.
CREDIT SUISSE FIRST BOSTON
MERRILL LYNCH & CO.
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