Document:

Exhibit 4.1(b)

 

SUPPLEMENTAL INDENTURE NO. 1

 

THIS SUPPLEMENTAL INDENTURE NO. 1, dated as of November 10, 2006 (the “Supplemental Indenture No. 1”), between CIGNA CORPORATION, a corporation duly organized and existing under the laws of the State of Delaware (the “Company”), and U.S. BANK NATIONAL ASSOCIATION, a national banking association duly organized and existing under the laws of the United States of America, as trustee (the “Trustee”).

 

RECITALS:

 

WHEREAS, the Company and the Trustee are parties to a Senior Indenture, dated as of August 16, 2006 (the “Base Indenture” and as amended by this Supplemental Indenture No. 1, the “Indenture”), relating to the issuance from time to time by the Company of its Securities on terms to be specified at the time of issuance;

 

WHEREAS, Section 901(7) of the Base Indenture provides that the Company may enter into a supplemental indenture to establish the terms and provisions of a series of Securities issued pursuant to the Indenture;

 

WHEREAS, the Company desires to issue a series of Securities, and has duly authorized the creation and issuance of such Securities and the execution and delivery of this Supplemental Indenture No. 1 to modify the Base Indenture and provide certain additional provisions as hereinafter described;

 

WHEREAS, the parties hereto deem it advisable to enter into this Supplemental Indenture No. 1 for the purpose of establishing the terms of such Securities, providing for the rights, obligations and duties of the Trustee with respect to such Securities and amending certain provisions of the Base Indenture; and

 

WHEREAS, all conditions and requirements of the Base Indenture necessary to make this Supplemental Indenture No. 1 a valid, binding and legal instrument in accordance with its terms have been performed and fulfilled by the parties hereto.

 

NOW, THEREFORE, for and in consideration of the premises and other good and valuable consideration, receipt of which is hereby acknowledged by the parties hereto, the parties hereto agree as follows:

 

ARTICLE I

THE SENIOR NOTES

 

Section 1.01         Title of Securities. There shall be a series of Securities designated the “6.150% Senior Notes due 2036” of the Company (the “Senior Notes”).

 

Section 1.02         Limitation of Aggregate Principal Amount. The aggregate principal amount of the Senior Notes shall initially be limited to $250,000,000 (except for Securities

 

 

authenticated and delivered upon registration of transfer of, or in exchange for, or in lieu of, Senior Notes pursuant to Sections 304, 305, 306, 906 or 1107 of the Indenture and except for any Securities which, pursuant to Section 303 of the Indenture, are deemed never to have been authenticated and delivered thereunder). The Company may, without the consent of the Holders of the Senior Notes, issue additional Senior Notes having the same interest rate, maturity date, CUSIP number and other terms (other than issue date and issue price) (“Additional Senior Notes”). Any Additional Senior Notes, together with the Senior Notes, will constitute a single series of Securities under the Indenture. No Additional Senior Notes may be issued if an Event of Default under the Indenture has occurred and is continuing with respect to the Senior Notes.

 

Section 1.03         Principal Payment Date. The principal amount of the Senior Notes outstanding (together with any accrued and unpaid interest) shall be payable in a single installment on November 15, 2036, which date shall be the Stated Maturity of the Senior Notes.

 

Section 1.04         Interest and Interest Rates. The rate of interest on each Senior Note shall be 6.150% per annum, accruing from November 10, 2006, or from the most recent Interest Payment Date to which interest has been paid or duly provided for, payable semiannually in arrears on May 15 and November 15 of each year commencing May 15, 2007 until the principal thereof is paid or made available for payment. The amount of interest payable on any Interest Payment Date shall be computed on the basis of a 360-day year of twelve 30-day months. The amount of interest payable for any period shorter than a full monthly period shall be computed on the basis of the actual number of calendar days elapsed in such a period. In the event that any Interest Payment Date, Redemption Date, Maturity or Stated Maturity of any Senior Note is not a Business Day, then payment of interest or principal (and premium, if any) payable on such date will be made on the next succeeding day that is a Business Day (and without any interest or other payment in respect of any such delay). The interest so payable in respect of any Senior Note, and punctually paid or duly provided for, on any Interest Payment Date will be paid to the Person in whose name such Senior Note (or one or more Predecessor Securities) is registered at the close of business on the fifteenth calendar day (whether or not a Business Day) prior to such Interest Payment Date (the “Regular Record Date”). Any such interest not punctually paid or duly provided for in respect of any Senior Note shall forthwith cease to be payable to the registered Holder on such Regular Record Date and may either be paid to the Person in whose name such Senior Note (or one or more Predecessor Securities) is registered at the close of business on a Special Record Date to be fixed by the Trustee for the payment of such Defaulted Interest, notice whereof shall be given to the Holders of the Senior Notes not less than 10 calendar days prior to such Special Record Date, or be paid at any time in any other lawful manner not inconsistent with the requirements of any securities exchange on which the Senior Notes may be listed, and upon such notice as may be required by such exchange.

 

Section 1.05         Place of Payment. The place where the Senior Notes may be presented or surrendered for payment, where the Senior Notes may be surrendered for registration of transfer or exchange and where notices and demand to or upon the Company in respect of the Senior Notes and the Indenture may be served shall be the Corporate Trust Office of the Trustee or the Paying Agent’s office maintained for that purpose in the Borough of Manhattan, City of New York.

 

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Section 1.06         Optional Redemption.

 

(a)           The Company may redeem the Senior Notes, at any time, and from time to time, in whole or in part, at a redemption price equal to the greater of (i) 100% of the principal amount of such Senior Notes to be redeemed and (ii) the sum of the present values of the remaining scheduled payments of principal and interest (excluding interest accrued to the Redemption Date) on the Senior Notes to be redeemed from the Redemption Date to the Stated Maturity date discounted to the Redemption Date on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) at the Treasury Rate, plus 25 basis points, plus, in each case, accrued and unpaid interest on the Senior Notes to the Redemption Date (the “Redemption Price”). Unless the Company defaults in payment of the Redemption Price, interest will cease to accrue on the Senior Notes called for redemption on and after the Redemption Date.

 

(b)           The Treasury Rate shall be calculated on the third Business Day preceding the Redemption Date.

 

(c)           Notice of redemption shall be given in accordance with Section 1104 of the Indenture. If less than all of the Senior Notes then Outstanding are to be redeemed, the Trustee will select the particular Senior Notes or portions thereof in accordance with Section 1103 of the Indenture.

 

(d)           For the purposes of this Section 1.06 of Supplemental Indenture No. 1, the terms below are defined as follows:

 

“Comparable Treasury Issue” means the United States Treasury Security selected by an Independent Investment Banker as having a maturity comparable to the remaining term of the Senior Notes to be redeemed that would be utilized, at the time of selection and in accordance with customary financial practice, in pricing new issues of corporate debt securities of comparable maturity to the remaining term of the Senior Notes to be redeemed.

 

“Comparable Treasury Price” means, with respect to any Redemption Date for any Senior Notes, the average of all Reference Treasury Dealer Quotations obtained.

 

“Independent Investment Banker” means one of the Reference Treasury Dealers appointed by the Trustee after consultation with the Company.

 

“Primary Treasury Dealer” means a primary U.S. Government securities dealer in New York City.

 

“Reference Treasury Dealer” means Barclays Capital Inc. and its successors and J.P. Morgan Securities Inc. and its successors; provided, however, that if any Reference Treasury Dealer ceases to be a Primary Treasury Dealer, the Company will substitute therefor another Primary Treasury Dealer.

 

“Reference Treasury Dealer Quotations” means, with respect to each Reference Treasury Dealer and any Redemption Date, the average, as determined by the Trustee, of the bid and asked

 

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prices for the Comparable Treasury Issue (expressed in each case as a percentage of its principal amount) quoted in writing to the Trustee by that Reference Treasury Dealer at 5:00 p.m. (New York City time) on the third Business Day preceding such Redemption Date.

 

“Treasury Rate” means, with respect to any Redemption Date, (1) the yield, under the heading which represents the average for the immediately preceding week, appearing in the most recently published statistical release designated “H.15(519)” or any successor publication which is published weekly by the Board of Governors of the Federal Reserve System and which establishes yields on actively traded United States Treasury securities adjusted to constant maturity under the caption “Treasury Constant Maturities,” for the maturity corresponding to the Comparable Treasury Issue (if no maturity is within three months before or after the maturity date for the Senior Notes, yields for the two published maturities most closely corresponding to the Comparable Treasury Issue will be determined and the Treasury Rate shall be interpolated or extrapolated from such yields on a straight line basis, rounding to the nearest month) or (2) if such release (or any successor release) is not published during the week preceding the calculation date or does not contain such yields, the rate per annum equal to the semi-annual equivalent yield-to-maturity of the Comparable Treasury Issue, calculated using a price for the Comparable Treasury Issue (expressed as a percentage of its principal amount) equal to the Comparable Treasury Price for such Redemption Date.

 

Section 1.07         Sinking Fund Obligations. The Company has no obligation to redeem or purchase any Senior Notes pursuant to any sinking fund or analogous requirement or upon the happening of a specified event or at the option of a Holder thereof.

 

Section 1.08         Denomination. The Senior Notes shall be issuable only in registered form without coupons and in denominations of $2,000 and multiples of $1,000 in excess thereof.

 

Section 1.09         Currency. Principal and interest on the Senior Notes shall be payable in such coin or currency of the United States of America that at the time of payment is legal tender for payment of public and private debts.

 

Section 1.10         Senior Notes to be Issued in Global Form. The Senior Notes will be permanently represented by one or more securities in global form (the “Global Note”). The Company hereby designates The Depository Trust Company as the initial Depositary for the Global Note.

 

Section 1.11         Form of Senior Notes. The Senior Notes shall be substantially in the form attached as Annex A hereto.

 

Section 1.12         Security Registrar and Paying Agent for the Senior Notes. The Trustee shall serve initially as the Security Registrar and the Paying Agent.

 

Section 1.13         Defeasance. The provisions of Section 1006 of the Indenture shall apply to the Senior Notes.

 

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ARTICLE II

MISCELLANEOUS

 

Section 2.01         Integral Part; Effect of Supplement on Indenture. This Supplemental Indenture No. 1 constitutes an integral part of the Indenture. Except for the amendments and supplements made by this Supplemental Indenture No. 1, the Base Indenture shall remain in full force and effect as executed.

 

Section 2.02         General Definitions. For purposes of this Supplemental Indenture No. 1:

 

(a)           Capitalized terms used herein without definition shall have the meanings specified in the Base Indenture;

 

(b)           All references to Articles and Sections, unless otherwise specified, refer to the corresponding Articles and Sections of the Base Indenture; and

 

(c)           The terms “herein,” “hereof,” “hereunder” and other words of similar import refer to this Supplemental Indenture No. 1.

 

Section 2.03         Adoption, Ratification and Confirmation. The Indenture, as supplemented by this Supplemental Indenture No. 1, is in all respects hereby adopted, ratified and confirmed.

 

Section 2.04         Trustee Not Responsible for Recitals. The recitals in this Supplemental Indenture No. 1 are made by the Company, and the Trustee assumes no responsibility for the correctness of such recitals. The Trustee makes no representations as to the validity or sufficiency of this Supplemental Indenture No. 1.

 

Section 2.05         Counterparts. This Supplemental Indenture No. 1 may be executed in multiple counterparts, each of which shall be regarded for all purposes as an original and all of which shall constitute but one and the same instrument.

 

Section 2.06         Governing Law. This Supplemental Indenture No. 1 and the Senior Notes shall be governed by and construed in accordance with the laws of the State of New York applicable to agreements made or instruments entered into, in each case, performed in said state.

 

[signature page follows]

 

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IN WITNESS WHEREOF, the Company and the Trustee have executed this Supplemental Indenture No. 1 as of the date first above written.

 

 

	
CIGNA   CORPORATION
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Mordecai Schwartz
    
	
 
    	
 
    
	
Name:   Mordecai Schwartz
    	
 
    
	
Title:   Senior Vice President and Treasurer
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
U.S.   BANK NATIONAL ASSOCIATION
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Paul J. Schmalzel
    
	
 
    	
 
    
	
Name:   Paul J. Schmalzel
    	
 
    
	
Title:   Vice President
    	
 
    

 

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ANNEX A

FORM OF GLOBAL NOTE

 

UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (AND ANY PAYMENT HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

 

THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE AND IS REGISTERED IN THE NAME OF CEDE & CO. THIS SECURITY MAY NOT BE EXCHANGED IN WHOLE OR IN PART FOR A SECURITY REGISTERED, AND NO TRANSFERS OF THIS GLOBAL SECURITY IN WHOLE OR IN PART MAY BE REGISTERED, IN THE NAME OF ANY PERSON OTHER THAN NOMINEES OF CEDE & CO. OR A SUCCESSOR THEREOF OR SUCH SUCCESSOR’S NOMINEE.

 

CIGNA CORPORATION

6.150% Senior Note Due 2036

 

CUSIP: 125509BH1

 

	
No. 11/07/2006-01
    	
 
    	
Principal Amount $250,000,000
    

 

CIGNA CORPORATION, a Delaware corporation (herein called the “Company”), which term includes any successor Person under the Indenture hereinafter referred to, for value received, hereby promises to pay to CEDE & CO., or its registered assigns, the principal sum of Two Hundred Fifty Million Dollars ($250,000,000) upon presentation and surrender of this Security on November 15, 2036 and to pay interest thereon accruing from November 10, 2006 or from the most recent Interest Payment Date to which interest has been paid or duly provided for, semi-annually in arrears on May 15 and November 15 of each year, commencing May 15, 2007, at the rate of 6.150% per annum, until the principal hereof is paid or made available for payment. The interest so payable, and punctually paid or duly provided for, on any Interest Payment Date will, as provided in such Indenture, be paid to the Person in whose name this Security (or one or more Predecessor Securities) is registered at the close of business on the Regular Record Date for such interest payment, which shall be the close of business on the fifteenth calendar day (whether or not a Business Day) prior to such Interest Payment Date. Any such interest not

 

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punctually paid or duly provided for shall forthwith cease to be payable to the registered Holder on such Regular Record Date and may either be paid to the Person in whose name this Security (or one or more Predecessor Securities) is registered at the close of business on a Special Record Date for the payment of such Defaulted Interest to be fixed by the Trustee, notice whereof shall be given to Holders of Securities of this series not less than 10 calendar days prior to such Special Record Date, or be paid at any time in any other lawful manner not inconsistent with the requirements of any securities exchange on which the Securities of this series may be listed, and upon such notice as may be required by such exchange, all as more fully provided in said Indenture.

 

Payment of the principal of (and premium, if any) and interest on this Security will be made at the office or agency of the Company maintained for that purpose in the Borough of Manhattan, City of New York, in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts; provided, however, 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 such address shall appear in the Security Register.

 

Reference is hereby made to the further provisions of this Security set forth on the reverse hereof, which further provisions shall for all purposes have the same effect as if set forth at this place.

 

Unless the certificate of authentication hereon has been executed the Trustee referred to on the reverse hereof by manual signature, this Security shall not be entitled to any benefit under the Indenture or be valid or obligatory for any purpose.

 

IN WITNESS WHEREOF, the Company has caused this instrument to be duly executed under its corporate seal.

 

 

	
[SEAL]
    	
 
    
	
 
    	
 
    
	
 
    	
CIGNA   CORPORATION 
    
	
 
    	
 
    
	
 
    	
By:   
    	
 
    
	
 
    	
Name:   Mordecai Schwartz 
    
	
 
    	
Title:   Senior Vice President and Treasurer
    
	
 
    	
 
    
	
Attest:   
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
Name:   Christine A. Reuther 
    	
 
    
	
Title:   Assistant Corporate Secretary
    	
 
    

 

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TRUSTEE’S CERTIFICATE OF AUTHENTICATION

 

This is one of the Securities of the series designated under, and referred to in, the within-mentioned Indenture.

 

U.S. BANK NATIONAL ASSOCIATION, as Trustee

 

	
 
    
	
By:
    	
 
    	
 
    
	
Authorized Signatory:
    

 

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[REVERSE SIDE OF SECURITY]

 

CIGNA CORPORATION

6.150% Senior Notes due 2036

 

This Security is one of a duly authorized issue of securities of the Company (herein called the “Securities”), issued and to be issued in one or more series under a Senior Indenture, dated as of August 16, 2006, as supplemented by a Supplemental Indenture No. 1, dated as of November 10, 2006 (as so supplemented, the “Indenture”), between the Company, as issuer, and U.S. Bank National Association, as trustee (herein called the “Trustee”, which term includes any successor trustee under the Indenture), to which Indenture and all indentures supplemental thereto reference is hereby made for a statement of the respective rights, limitations of rights, duties and immunities thereunder of the Company, the Trustee and the Holders of the Securities and of the terms upon which the Securities are, and are to be, authenticated and delivered. This Security is one of the series designated on the face hereof, initially limited in aggregate principal amount to $250,000,000, subject to future issuances of additional Securities pursuant to Section 301 of the Indenture.

 

The Securities of this series are subject to redemption upon not less than 30 calendar days’ nor more than 60 calendar days’ notice by mail, at any time, and from time to time, in whole or in part, at a redemption price equal to the greater of (i) 100% of the principal amount of such Securities to be redeemed and (ii) the sum of the present values of the remaining scheduled payments of principal and interest (excluding interest accrued to the Redemption Date) on the Securities to be redeemed from the Redemption Date to the Stated Maturity date discounted to the Redemption Date on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) at the Treasury Rate, plus 25 basis points, plus, in each case, accrued and unpaid interest on the Securities to the Redemption Date.

 

“Treasury Rate” means, with respect to any Redemption Date, (1) the yield, under the heading which represents the average for the immediately preceding week, appearing in the most recently published statistical release designated “H.15(519)” or any successor publication which is published weekly by the Board of Governors of the Federal Reserve System and which establishes yields on actively traded United States Treasury securities adjusted to constant maturity under the caption “Treasury Constant Maturities,” for the maturity corresponding to the Comparable Treasury Issue (if no maturity is within three months before or after the maturity date for the Senior Notes, yields for the two published maturities most closely corresponding to the Comparable Treasury Issue will be determined and the Treasury Rate shall be interpolated or extrapolated from such yields on a straight line basis, rounding to the nearest month) or (2) if such release (or any successor release) is not published during the week preceding the calculation date or does not contain such yields, the rate per annum equal to the semi-annual equivalent yield-to-maturity of the Comparable Treasury Issue, calculated using a price for the Comparable Treasury Issue (expressed as a percentage of its principal amount) equal to the Comparable Treasury Price for such Redemption Date.

 

The Treasury Rate shall be calculated on the third Business Day preceding the Redemption Date.

 

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“Comparable Treasury Issue” means the United States Treasury Security selected by an Independent Investment Banker as having a maturity comparable to the remaining term of the Senior Notes to be redeemed that would be utilized, at the time of selection and in accordance with customary financial practice, in pricing new issues of corporate debt securities of comparable maturity to the remaining term of the Senior Notes to be redeemed.

 

“Comparable Treasury Price” means, with respect to any Redemption Date for any Senior Notes, the average of all Reference Treasury Dealer Quotations obtained.

 

“Independent Investment Banker” means one of the Reference Treasury Dealers appointed by the Trustee after consultation with the Company.

 

“Primary Treasury Dealer” means a primary U.S. Government securities dealer in New York City.

 

“Reference Treasury Dealer” means Barclays Capital Inc. and its successors and J.P. Morgan Securities Inc. and its successors; provided, however, that if any Reference Treasury Dealer ceases to be a Primary Treasury Dealer, the Company will substitute therefor another Primary Treasury Dealer.

 

“Reference Treasury Dealer Quotations” means, with respect to each Reference Treasury Dealer and any Redemption Date, the average, as determined by the Trustee, of the bid and asked prices for the Comparable Treasury Issue (expressed in each case as a percentage of its principal amount) quoted in writing to the Trustee by that Reference Treasury Dealer at 5:00 p.m. (New York City time) on the third Business Day preceding such Redemption Date.

 

Unless the Company defaults in payment of the Redemption Price, interest will cease to accrue on the Securities of this series called for redemption on and after the Redemption Date. In the event of redemption of this Security in part only, a new Security or Securities of this series for the unredeemed portion hereof will be issued in the name of the Holder hereof upon the cancellation hereof.

 

If an Event of Default with respect to Securities of this series shall occur and be continuing, the principal of the Securities of this series may be declared due and payable in the manner and with the effect provided in the Indenture.

 

The Indenture permits, with certain exceptions as therein provided, the amendment thereof and the modification of the rights and obligations of the Company and the rights of the Holders of the Securities of each series to be affected under the Indenture at any time by the Company and the Trustee with the consent of the Holders of not less than a majority in aggregate principal amount of the Securities at the time Outstanding of each series to be affected. The Indenture also contains provisions permitting the Holders of specified percentages in aggregate principal amount of the Securities of each series at the time Outstanding, on behalf of the Holders of all Securities of such series, to waive compliance by the Company with certain provisions of the Indenture and certain past defaults under the Indenture and their consequences. Any such consent or waiver by the Holder of this Security shall be conclusive and binding upon

 

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such Holder and upon all future Holders of this Security and of any Security issued upon the registration of transfer hereof or in exchange herefor or in lieu hereof, whether or not notation of such consent or waiver is made upon this Security.

 

No reference herein to the Indenture and no provision of this Security or of the Indenture shall alter or impair the obligation of the Company, or the right of the Holder of this Security, which is absolute and unconditional, to pay, or, in the case of the Holder of this Security, to receive payment of, the principal of (and premium, if any) and interest on this Security at the times, place and rate, and in the coin or currency, herein prescribed.

 

As provided in the Indenture and subject to certain limitations therein set forth, the transfer of this Security is registrable in the Security Register, upon surrender of this Security for registration of transfer at the office or agency of the Company in any place where the principal of (and premium, if any) and interest on this Security are payable, duly endorsed by, or accompanied by a written instrument of transfer in form satisfactory to the Company and the Security Registrar duly executed by, the Holder hereof or such Holder’s attorney duly authorized in writing; and thereupon one or more new Securities of this series and of like tenor, of authorized denominations and for the same aggregate principal amount, will be issued to the designated transferee or transferees.

 

The Securities of this series are issuable only in registered form without coupons in denominations of $2,000 and multiples of $1,000 in excess thereof. As provided in the Indenture and subject to certain limitations therein set forth, Securities of this series are exchangeable for other Securities of this series, of a like tenor and aggregate principal amount but of a different authorized denomination, as requested by the Holder surrendering the same.

 

No service charge shall be made for any such registration of transfer or exchange, but the Company or the Trustee may require payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in connection with any registration of transfer or exchange of Securities, other than exchanges pursuant to Section 304, 906 or 1107 of the Indenture not involving any transfer.

 

Prior to due presentment of this Security for registration of transfer, the Company, the Trustee and any agent of the Company or the Trustee may treat the Person in whose name this Security is registered as the owner hereof for all purposes, whether or not this Security be overdue, and neither the Company, the Trustee nor any such agent shall be affected by notice to the contrary.

 

The Indenture provides that the Company, at the Company’s option, (a) will be discharged from any and all obligations in respect of the Securities (except for certain obligations to register the transfer or exchange of Securities, replace stolen, lost or mutilated Securities, maintain paying agencies and hold moneys for payment in trust) or (b) need not comply with certain restrictive covenants of the Indenture, in each case if the Company deposits, in trust, with the Trustee money, or U.S. Government Obligations (or Foreign Government Obligations if the Securities are denominated in a foreign currency or currencies) which through the payment of interest thereon and principal thereof in accordance with their terms will provide money, in an

 

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amount sufficient to pay all the principal (including any mandatory sinking fund payments) of, and (premium, if any) and interest on, the Securities on the dates such payments are due in accordance with the terms of such Securities, and certain other conditions are satisfied.

 

No recourse shall be had for the payment of the principal of (and premium, if any) or interest on this Security, or for any claim based hereon, or otherwise in respect hereof, or based on or in respect of the Indenture or any indenture supplemental thereto, against any incorporator, stockholder, officer, employee, agent or director, as such, past, present or future, of the Company or of any successor corporation, whether by virtue of any constitution, statute or rule of law, or by the enforcement of any assessment or penalty or otherwise, all such liability being, by the acceptance hereof and as part of the consideration for the issue hereof, expressly waived and released.

 

All terms used in this Security which are defined in the Indenture shall have the meanings assigned to them in the Indenture.

 

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ASSIGNMENT FORM

 

	
I   or we assign and transfer this Security to:
    
	
 
    
	
 
    
	
 
    
	
Insert   social security or other identifying number of assignee
    
	
 
    
	
 
    
	
 
    	
 
    
	
 
    
	
Print   or type name, address and zip code of assignee
    
	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
 
    

 

and irrevocably appoint                                                                    , as agent, to transfer this Security on the books of the Company.

The agent may substitute another to act for him.

 

	
 
    	
 
    
	
Date:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
Signed
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
(Sign   exactly as name appears on the other side of this Security)
    
					

 

Signature Guarantee*:

 

*    The Holder’s signature must be guaranteed by a member firm of a registered national securities exchange or of the National Association of Securities Dealers, Inc., a commercial bank or trust company having an office or correspondent in the United States or an “eligible guarantor institution” as defined by Rule l7Ad-15 under the Exchange Act.

 

8Exhibit 10.4

 

CIGNA RESTRICTED SHARE EQUIVALENT

PLAN FOR NON-EMPLOYEE DIRECTORS

(Amended and Restated Effective January 1, 2008)

 

ARTICLE 1

Statement of Purpose; Effect on Prior Plans

 

The CIGNA Restricted Share Equivalent Plan for Non-Employee Directors (Amended and Restated Effective January 1, 2008) (“Plan”) is an amendment and restatement of the Restricted Stock/Stock Equivalent Plan for Non-Employee Directors of CIGNA Corporation (“Former Plan”).

 

The Company granted restricted shares of Company Common Stock under the Former Plan from September 30, 1989 to September 30, 2004, and Restricted Share Equivalents (described in Article 3) from October 1, 2004 to January 1, 2006.  No grants of any kind were made under the Former Plan after January 1, 2006. The Former Plan was closed to new participants effective January 17, 2006.

 

This Plan applies only to Restricted Share Equivalents granted under the Former Plan between October 1, 2004 and January 1, 2006.  No grants will be made under this Plan.  The purpose of this amendment and restatement is to comply with Section 409A of the Internal Revenue Code and to delete now-obsolete Plan provisions.

 

ARTICLE 2

Definitions

 

Except as otherwise provided in the Plan or unless the context otherwise requires, the terms defined below shall have the following meanings under the Plan:

 

2.01                        “Affiliate” — the meaning set forth in Rule 12b-2 promulgated under the Exchange Act.

 

2.02                        “Beneficial Owner” and “Beneficially Owned” — the meaning set forth in Rule 13d-3 promulgated under the Exchange Act.

 

2.03                        “Board” — the Company’s Board of Directors.

 

2.04                        “Change of Control” — any of the following:

 

(a)                                 A corporation, person or group acting in concert, as described in Exchange Act Section 14(d)(2), holds or acquires beneficial ownership within the meaning of Rule 13d-3 promulgated under the Exchange Act of a number of preferred or common shares of the Company having 25% or more of the combined voting power of the Company’s then outstanding securities; or

 

(b)                                 There is consummated a merger or consolidation of the Company or any direct or indirect subsidiary of the Company with any other corporation, other than:

 

(i)                                     a merger or consolidation immediately following which the individuals who constituted the Board immediately prior thereto constitute at least a majority of the board of 

 

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directors of the entity surviving such merger or consolidation or the ultimate parent thereof, or

 

(ii)                                  a merger or consolidation effected to implement a recapitalization of the Company (or similar transaction) in which no Person is or becomes the Beneficial Owner, directly or indirectly, of securities of the Company (not including in the securities Beneficially Owned by such Person any securities acquired directly from the Company or its Affiliates) representing 25% or more of the combined voting power of the Company’s then outstanding securities;

 

(c)                                  A change occurs in the composition of the Board at any time during any consecutive 24-month period such that the Continuity Directors cease for any reason to constitute a majority of the Board.  For purposes of the preceding sentence “Continuity Directors” shall mean those members of the Board who either: (1) were directors at the beginning of such consecutive 24-month period; or (2) were elected by, or on nomination or recommendation of, at least a majority of the Board (other than a director whose initial assumption of office is in connection with an actual or threatened election contest, including but not limited to a consent solicitation, relating to the election of directors of the Company); or

 

(d)                                 The shareholders of the Company approve a plan of complete liquidation or dissolution of the Company or there is consummated an agreement for the sale or disposition by the Company of all or substantially all of the Company’s assets, other than a sale or disposition by the Company of all or substantially all of the Company’s assets immediately following which the individuals who constituted the Board immediately prior thereto constitute at least a majority of the board of directors of the entity to which such assets are sold or disposed or any parent thereof.

 

Notwithstanding the foregoing, a “Change of Control” shall not be deemed to have occurred by virtue of the consummation of any transaction or series of integrated transactions immediately following which the record holders of the common stock of the Company immediately prior to such transaction or series of transactions continue to have substantially the same proportionate ownership in an entity which owns all or substantially all of the assets of the Company immediately following such transaction or series of transactions.

 

2.05                        “Committee” — the Corporate Governance Committee of the Board or any successor committee with responsibility for compensation of directors.

 

2.06                        “Common Stock” — the common stock, par value $0.25 per share, of CIGNA Corporation.

 

2.07                        “Company” — CIGNA Corporation.

 

2.08                      “Disability” — a permanent and total disability as defined in Section 22(e)(3) of the Internal Revenue Code.

 

2.09        “Eligible Director” — a person who (a) was elected to the Board after September 30, 1989 and before January 1, 2006; (b) served as a director for at least six months; and (c) for the ten-year period ending on the date such service began, was not an officer or employee of the Company or any of its Subsidiaries.

 

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2.10        “Exchange Act” — the Securities Exchange Act of 1934, as amended.

 

2.11        “Person” — the meaning given in Section 3(a)(9) of the Exchange Act, as modified and used in Sections 13(d) and 14(d) thereof, except that such term shall not include (a) the Company or any of its Subsidiaries, (b) a trustee or other fiduciary holding securities under an employee benefit plan of the Company or any of its Affiliates, (c) an underwriter temporarily holding securities pursuant to an offering of such securities, or (d) a corporation owned, directly or indirectly, by the stockholders of the Company in substantially the same proportions as their ownership of stock of the Company.

 

2.12        “Plan” — the CIGNA Restricted Share Equivalent Plan for Non-Employee Directors (Amended and Restated Effective January 1, 2008).

 

2.13        “Restricted Share Equivalent” — a unit that represents a right to a cash payment equal to the value of one share of the Company’s Common Stock and a right to payment of hypothetical dividends, as described in Article 3.

 

2.14        “Separation from Service” — an Eligible Director’s separation from service, within the meaning of Treasury Regulation Section 1.409A-1(h).  Generally, a Separation from Service occurs when a Director ceases to serve as a member of the Board or otherwise provide services to the Company or its affiliates.

 

2.15        “Subsidiary” — any corporation of which more than 50% of the total combined voting power of all classes of stock entitled to vote, or other equity interest, is directly or indirectly owned by CIGNA Corporation; or a partnership, joint venture or other unincorporated entity of which more than a 50% interest in the capital, equity or profits is directly or indirectly owned by CIGNA Corporation; provided that such corporation, partnership, joint venture or other unincorporated entity is included in the Company’s consolidated financial statements under generally accepted accounting principles.

 

ARTICLE 3

Restricted Share Equivalents

 

3.01        Eligibility and Grant.   Each director who became an Eligible Director after October 1, 2004 but before January 17, 2006 received a grant of 4,500 Restricted Share Equivalents, effective as of the date the director became an Eligible Director.  All outstanding Restricted Share Equivalents were adjusted to reflect a three-for-one stock split on June 4, 2007, so that Eligible Directors with outstanding grants had 13,500 Restricted Share Equivalents as of the split effective date.

 

3.02        General.  The Company maintains an account on its books and records to record the number of Restricted Share Equivalents granted by the Company to Eligible Directors.  Subject to the provisions of Section 3.04 below, the restrictions set forth in Section 3.03 shall apply to each grant of Restricted Share Equivalents.  An Eligible Director’s right to receive plan payments represents an unsecured claim against CIGNA Corporation’s general assets.

 

3.03        Restrictions on Restricted Share Equivalents.  The following restrictions apply to Restricted Share Equivalents:

 

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(a)                                 Except as otherwise provided in Section 3.06, the Eligible Director shall not be entitled to the payment of the Restricted Share Equivalents until the date provided in Section 3.05;

 

(b)                                 None of the Restricted Share Equivalents may be sold, transferred, assigned, pledged, or otherwise encumbered or disposed of; and

 

(c)                                  All of the Restricted Share Equivalents shall be forfeited, and all rights of the Eligible Director to such Restricted Share Equivalents shall terminate without further obligation on the part of the Company, upon the Eligible Director’s ceasing to be a director of the Company before the date the Restricted Share Equivalents vest.

 

3.04  Vesting of Restricted Share Equivalents.

 

(a)                                 The Restricted Share Equivalents granted to an Eligible Director shall vest on the later of:

 

(1)                                 Six months after the date of grant; or

(2)                                 The earliest of:

 

(A)                               The Eligible Director’s ninth anniversary of continuous service as a director of the Company;

(B)                               The Eligible Director’s attainment of age 65;

(C)                               The Eligible Director’s Disability;

(D)                               The Eligible Director’s death; or

(E)                                The occurrence of a Change of Control.

 

(b)                                 If an Eligible Director’s resignation is accepted because he or she failed to receive the required majority vote for reelection and his or her Restricted Share Equivalents have not yet vested pursuant to Section 3.04(a), then a pro-rated portion of the Eligible Director’s Restricted Share Equivalents shall automatically vest effective as of the date of such resignation, with the portion to vest determined by multiplying 13,500 (adjusted as needed after June 4, 2007 in accordance with Section 4.01) by the following fraction: the number of complete months the Eligible Director performed continuous service as a director of the Company divided by 108.  Any resulting fractional Restricted Share Equivalent shall be eliminated.

 

(c)                                  If an Eligible Director ceases to be a director of the Company before the vesting of Restricted Share Equivalents pursuant to Section 3.04(a) or (b), the Eligible Director shall immediately forfeit all unvested Restricted Share Equivalents, except to the extent a majority of the other members of the Board approves their vesting.

 

3.05        Payment of Vested Restricted Share Equivalents. The cash value of the vested Restricted Share Equivalents shall be determined as of the date of an Eligible Director’s Separation from Service by using the closing price on that date as reported on the Composite tape or successor means of publishing stock prices (or, if the Composite tape or successor publication is not published on the date of Separation from Service, the closing price for the next preceding date of publication).  The Company shall pay the resulting cash value in a lump sum to the Eligible Director (or the Eligible Director’s beneficiary or estate, as the case may be) within 45 days of the Eligible Director’s Separation from Service.

 

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Notwithstanding the foregoing, if an Eligible Director is a specified employee within the meaning of Treas. Reg. sec. 1.409A-1(i) as of the date of Separation from Service, payment shall be made in a lump sum in the seventh month following Separation from Service. Restricted Share Equivalents will cease to be outstanding and an Eligible Director will cease to have any rights under them as of the date they are paid or forfeited.

 

3.06        Hypothetical Dividends.  Each year that a Restricted Share Equivalent is outstanding, a lump sum payment shall be made to the Eligible Director in an amount equal to any dividends declared and paid on one share of Company Common Stock in that year (to the extent the record date for any such actual dividend occurs while the Restricted Share Equivalent is outstanding).

 

Article 4

Miscellaneous

 

4.01        Adjustment in Event of Changes in Capitalization.  In the event of a combination or exchange of shares, merger, consolidation, rights offering, separation, reorganization or liquidation, or any other change in the corporate structure of the Company, the Board may make such equitable adjustments, to prevent dilution or enlargement of rights, as it may deem appropriate in the number of Restricted Share Equivalents.  Outstanding Restricted Share Equivalents shall be adjusted proportionally to reflect any recapitalization, stock split or stock dividend.  Any additional Restricted Share Equivalents issued as a consequence of any such changes in the corporate structure or shares of the Company shall be subject to the same restrictions and provisions applicable to the Restricted Share Equivalents with respect to which they are issued.

 

4.02        Termination or Amendment of the Plan.  The Board may at any time terminate the Plan and may from time to time alter or amend the Plan or any part hereof (including any amendment deemed necessary to ensure that the Company may comply with any regulatory requirement) without shareholder approval, unless otherwise required by law or by the rules of the Securities and Exchange Commission or New York Stock Exchange.  No termination or amendment of the Plan may, without the consent of an Eligible Director, impair the rights of such director with respect to outstanding Restricted Share Equivalents.

 

4.03        Administration.  The Plan is to be administered by the Committee.  The Committee shall have full power and authority to adopt, amend and rescind administrative guidelines, rules and regulations relating to this Plan, to interpret the Plan and to rule on any questions relating to any of its provisions, terms and conditions.

 

4.04        No Obligation to Nominate.  Nothing in the Plan shall be deemed to create any obligation on the part of the Board to nominate any director for reelection by the Company’s shareholders.

 

4.05        Taxes and Withholding.  The Company shall have the right to withhold any taxes as required by law with respect to the cash value of the Restricted Share Equivalents.

 

4.06        Code Section 409A.  It is intended that the Plan comply with the requirements of Code Section 409A, and the Plan shall be so administered and interpreted.

 

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4.07        Effective Dates.  The Former Plan became effective as of September 30, 1989.  The effective date of this amended and restated Plan is January 1, 2008.

 

4.08        References.  All statutory and regulatory references in this Plan shall include successor provisions.

 

4.09        Controlling Law.  This Plan shall be construed and enforced according to the laws of the Commonwealth of Pennsylvania, without regard to Pennsylvania conflict of laws rules, to the extent not preempted by federal law, which shall otherwise control.

 

END OF DOCUMENT

 

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