PART II ITEM 8 Financial Statements and Supplementary Data Debt NOTE 16 (In millions) 2012 2011 Short-term: Commercial paper $ 200 $ 100 Current maturities of long-term debt 1 4 TOTAL SHORT-TERM DEBT $ 201 $ 104 Long-term: Uncollateralized debt: 2.75% Notes due 2016 $ 600 $ 600 5.375% Notes due 2017 250 250 6.35% Notes due 2018 131 131 8.5% Notes due 2019 251 251 4.375% Notes due 2020 249 249 5.125% Notes due 2020 299 299 6.37% Notes due 2021 78 78 4.5% Notes due 2021 299 298 4% Notes due 2022 743 743 7.65% Notes due 2023 100 100 8.3% Notes due 2023 17 17 7.875% Debentures due 2027 300 300 8.3% Step Down Notes due 2033 83 83 6.15% Notes due 2036 500 500 5.875% Notes due 2041 298 298 5.375% Notes due 2042 750 750 Other 38 43 TOTAL LONG-TERM DEBT $ 4,986 $ 4,990 interest rate of 4% ($743 million, net of discount, with an effective interest rate of 4.346% per year) and $750 million of 30-Year Notes due February 15, 2042 at a stated interest rate of 5.375% ($750 million, net of discount, with an effective interest rate of 5.542% per year). Interest is payable on May 15 and November 15 of each year beginning May 15, 2012 for the 5-Year Notes and February 15 and August 15 of each year beginning February 15, 2012 for the 10-Year and 30-Year Notes. The proceeds of this debt were used to fund the HealthSpring acquisition in January 2012. The Company may redeem these Notes, at any time, in whole or in part, at a redemption price equal to the greater of: In March 2011, the Company issued $300 million of 10-Year Notes due March 15, 2021 at a stated interest rate of 4.5% ($298 million, net of discount, with an effective interest rate of 4.683% per year) and $300 million of 30-Year Notes due March 15, 2041 at a stated interest rate of 5.875% ($298 million, net of discount, with an effective interest rate of 6.008% per year). Interest is payable on March 15 and September 15 of each year beginning September 15, 2011. The proceeds of this debt were used for general corporate purposes, including the repayment of debt maturing in 2011. On November 10, 2011, the Company issued $2.1 billion of long-term debt as follows: $600 million of 5-Year Notes due November 15, 2016 at a stated interest rate of 2.75% ($600 million, net of discount, with an effective interest rate of 2.936% per year), $750 million of 10-Year Notes due February 15, 2022 at a stated In December 2012, the Company extended the life of its June 2011 five-year revolving credit and letter of credit agreement for $1.5 billion, that permits up to $500 million to be used for letters of credit. This agreement is diversified among 16 banks, with 3 banks each having 12% of the commitment and the remainder spread among 13 banks. The credit agreement includes options that are subject to consent by the administrative agent and the committing banks, to increase the commitment amount to $2 billion and to extend the term past December 2017. The credit agreement is available for general corporate purposes, including as a commercial paper backstop and for the issuance of letters of credit. This agreement has certain covenants, including a financial covenant requiring the Company to maintain a total debt-to-adjusted capital ratio at or below 0.50 to 1.00. As of December 31, 2012, the Company had $5.3 billion of borrowing capacity within the maximum debt coverage covenant in the agreement in addition to the $5.2 billion of debt outstanding. There were letters of credit of $66 million issued as of December 31, 2012. As described in Note 3, the Company acquired HealthSpring on January 31, 2012. At the acquisition date, HealthSpring had $326  million  of  debt  outstanding.  In accordance  with  debt  covenants, HealthSpring’s debt obligation was paid immediately following the acquisition. This repayment is reported as a financing activity in the statement of cash flows for the year ended December 31, 2012. 100% of the principal amount of the Notes to be redeemed; or GLYPH<127> the present value of the remaining principal and interest payments on the Notes being redeemed discounted at the applicable Treasury rate plus 30 basis points (5-Year 2.75% Notes due 2016), 35 basis points (10-Year 4% Notes due 2022), or 40 basis points (30-Year 5.375% Notes due 2042). GLYPH<127> CIGNA CORPORATION -  2012 Form  10-K 111