Filed Pursuant to Rule 424(b)(5)
Reg. No. 33-56553 and 33-50513
PROSPECTUS SUPPLEMENT
(To Prospectus Dated December 13, 1994)
$200,000,000
COMMERCIAL CREDIT COMPANY
7 7/8% NOTES DUE FEBRUARY 1, 2025
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Commercial Credit Company (the "Company") is offering $200,000,000 principal
amount of its 7 7/8% Notes due February 1, 2025 (the "Notes"). Interest on the
Notes is payable on February 1 and August 1, commencing August 1, 1995. The
Notes may not be redeemed prior to maturity by the Company, but registered
holders of the Notes may elect to have the Notes, or any portion thereof that is
an integral multiple of $1,000, repaid on February 1, 2005, at the principal
amount thereof together with interest payable to the date of repayment. Such
election, which is irrevocable when made, must be made within the period
commencing December 1, 2004 and ending at the close of business on January 1,
2005 (or, if such January 1 is not a business day, the next succeeding business
day). See "Description of Notes."
The Notes will be issued in fully registered form only in denominations of
$1,000 or integral multiples thereof. The Notes will be initially represented by
one or more global notes registered in the name of The Depository Trust Company
("DTC") or its nominee. Beneficial interests in Notes will be shown on, and
transfers thereof will be effected only through, records maintained by DTC and
its participants. Owners of beneficial interests in Notes will be entitled to
physical delivery of Notes in certificated form equal in principal amount to
their respective beneficial interests only under the limited circumstances
described herein. See "Description of Notes--Book-Entry Notes."
Settlement for the Notes will be made in immediately available funds. The
Notes will trade in the Same-Day Funds Settlement System of DTC, and, to the
extent that secondary market trading activity in the Notes is effected through
the facilities of DTC, such trades will be settled in immediately available
funds. All payments of principal and interest will be made by the Company in
immediately available funds.
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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. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
<TABLE>
UNDERWRITING
PRICE TO DISCOUNTS AND PROCEEDS TO
PUBLIC (1) COMMISSIONS (2) COMPANY (1) (3)
<S> <C> <C> <C>
Per Note............................. 100.00% .507% 99.493%
Total................................ $200,000,000 $1,014,000 $198,986,000
</TABLE>
(1) Plus accrued interest, if any, from February 10, 1995 to the date of
delivery.
(2) The Company has agreed to indemnify the Underwriters against certain
liabilities, including liabilities under the Securities Act of 1933, as
amended.
(3) Before deducting expenses payable by the Company estimated to be
$75,000.
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The Notes are offered by the Underwriters named herein, subject to prior
sale, when, as and if accepted by the Underwriters and subject to certain
conditions. It is expected that delivery of the Notes in book-entry form will be
made through the facilities of DTC, on or about February 10, 1995.
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SMITH BARNEY INC. CS FIRST BOSTON
February 3, 1995
<PAGE>
IN CONNECTION WITH THIS OFFERING, THE UNDERWRITERS MAY OVER-ALLOT OR EFFECT
TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE NOTES OFFERED
HEREBY AT A LEVEL ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET.
SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE COMMISSIONER
OF INSURANCE FOR THE STATE OF NORTH CAROLINA, NOR HAS THE COMMISSIONER OF
INSURANCE RULED UPON THE ACCURACY OR THE ADEQUACY OF THIS DOCUMENT.
-------------------
CAPITALIZATION
The following table sets forth the capitalization of the Company at December
31, 1994, and as adjusted to give effect to the issuance and sale of the Notes
and the application of the proceeds therefrom to the repayment of short-term
borrowings, as if such transaction had occurred on December 31, 1994.
<TABLE>
<CAPTION>
AT DECEMBER 31, 1994
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OUTSTANDING AS ADJUSTED
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(DOLLARS IN MILLIONS)
<S> <C> <C>
Debt:
Certificates of deposit.......................................... $ 73.5 $ 73.5
Short-term borrowings............................................ 2,304.6 2,104.6
Long-term debt................................................... 4,010.0 4,210.0
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Total debt................................................... $ 6,388.1 $ 6,388.1
Stockholder's equity:
Common stock ($.0l par value)--1,000
shares authorized: issued--1 share............................. -- --
Additional paid-in capital....................................... 163.5 163.5
Retained earnings................................................ 974.5 974.5
Other............................................................ (25.6) (25.6)
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Total stockholder's equity................................... 1,112.4 1,112.4
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Total capitalization................................................. $ 7,500.5 $ 7,500.5
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</TABLE>
RATIO OF EARNINGS TO FIXED CHARGES
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
------------------------------------
1994 1993 1992 1991 1990
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Ratio of earnings to fixed charges.................. 1.83 2.09 2.12* 1.67 1.54
</TABLE>
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* Included in earnings from continuing operations before income taxes (used in
the computation above) are net gains of $47.0 million resulting from the sale
of stock of Inter-Regional Financial Group, Inc., the sale of the Company's
investment in the common stock of Musicland Stores Corporation and the sale of
50% of Commercial Insurance Resources, Inc. Without giving effect to these net
gains, the ratio of earnings to fixed charges for 1992 would have been 1.99.
The ratio of earnings to fixed charges has been computed by dividing
earnings from continuing operations before income taxes and fixed charges by the
fixed charges. For purposes of this ratio, fixed charges consist of interest
expense and that portion of rentals deemed representative of the appropriate
interest factor.
S-2
<PAGE>
USE OF PROCEEDS
The net proceeds to be received by the Company from the sale of the Notes
will be added to its general corporate funds and may be used to reduce or
refinance other borrowings, for investments or for general corporate purposes.
In order to fund its financial services business, the Company expects to incur
additional indebtedness in the future.
DESCRIPTION OF NOTES
The following description of the terms of the Notes offered hereby (referred
to in the Prospectus as the "Offered Securities") supplements the description of
the general terms of Securities set forth in the Prospectus, to which
description reference is hereby made. The following summary of the Notes is
qualified in its entirety by reference thereto and to the Indenture referred to
therein.
The Notes will be limited to $200,000,000 in aggregate principal amount, as
a result of which, as of February 3, 1995, $1,150,000,000 aggregate principal
amount of Securities remains currently available to be offered by the Company
under the Registration Statements of which this Prospectus Supplement and the
accompanying Prospectus form a part. The Notes will be issued only in fully
registered form without coupons, in denominations of $1,000 and integral
multiples thereof. Initially, the Notes will be issued in the form of one or
more global notes (each, a "Book-Entry Note") registered in the name of DTC or
its nominee, as described below. The Notes will bear interest from February 10,
1995, at the annual rate set forth on the cover page of this Prospectus
Supplement. The Notes will mature on February 1, 2025. Interest on the Notes
will be payable semiannually on February 1 and August 1, commencing August 1,
1995, to the persons in whose names the Notes are registered at the close of
business on the preceding January 15 or July 15, respectively.
Principal of and interest on the Notes will be payable at the office or
agency of the Company to be maintained in the Borough of Manhattan, The City of
New York, initially at the Corporate Trust Office of the Trustee, 111 Wall
Street, Fifth Floor, New York, New York; 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 register of
holders of Notes. Notwithstanding the foregoing, payments of principal of and
interest on Book-Entry Notes will be made as described below.
The Indenture permits the defeasance of Securities upon the satisfaction of
the conditions described under "Description of Securities--Defeasance" in the
Prospectus. The Notes are subject to these defeasance provisions.
REDEMPTION
The Notes will not be redeemable at the option of the Company prior to
maturity and will not be subject to any sinking fund.
REPAYMENT AT OPTION OF HOLDER
The Notes will be repayable on February 1, 2005 (the "Put Option Date"), at
the option of the registered holders of the Notes, at 100% of their principal
amount together with interest payable to the date of repayment. In order for a
Note to be repaid on the Put Option Date, the Company must receive at the
Corporate Trust Office of the Trustee in the Borough of Manhattan, The City of
New York, within the period commencing December 1, 2004 and ending at the close
of business on January 1, 2005 (or, if such January 1 is not a business day, the
next succeeding business day), the Note with the form entitled "Option to Elect
Repayment" on the reverse of or otherwise accompanying the Note duly completed.
Any such notice received by the Company within the period commencing December 1,
2004 and ending at the close of business on January 1, 2005 (or, if such January
1 is not a business day, the next succeeding business day) shall be irrevocable.
The repayment option may be exercised by the holder of a Note for less than the
entire principal amount of such Note provided the principal amount which is to
be repaid is equal to $1,000 or an integral multiple of $1,000. All questions as
to the validity,
S-3
<PAGE>
eligibility (including time of receipt) and acceptance of any Note for repayment
will be determined by the Company, whose determination will be final and
binding.
It is anticipated that DTC's nominee will be the registered holder of the
Notes and therefore will be the only entity that can exercise a right to
repayment, and that repayment will be made in accordance with DTC's repayment
procedures in effect at that time. See "Description of Notes--Book-Entry Notes"
below. In order to ensure that DTC's nominee will timely exercise a right to
repayment with respect to a particular beneficial interest in the Notes, the
beneficial owner of such interest must instruct the broker or other direct or
indirect participant through which it holds a beneficial interest in the Notes
to notify DTC of its desire to exercise a right to repayment. Different firms
have different cut-off times for accepting instructions from their customers
and, accordingly, each beneficial owner should consult the broker or other
direct or indirect participant through which it holds an interest in the Notes
in order to ascertain the cut-off time by which such an instruction must be
given in order for timely notice to be delivered to DTC.
BOOK-ENTRY NOTES
The Notes will initially be issued in the form of one or more Book-Entry
Notes, which will be deposited with, or on behalf of, DTC and registered in the
name of DTC or its nominee. Except as set forth below, Book-Entry Notes may not
be transferred except as a whole by DTC to a nominee of DTC or by a nominee of
DTC to DTC or another nominee of DTC or by DTC or any nominee to a successor of
DTC or a nominee of such successor.
Principal and interest payments on the Notes represented by one or more
Book-Entry Notes will be made by the Company to DTC or its nominee, as the case
may be, as the registered owner of the related Book-Entry Note or Notes. The
Company expects that DTC or its nominee, upon receipt of any payment of
principal or interest in respect of Book-Entry Notes, will credit immediately
the accounts of the related participants with payment in amounts proportionate
to their respective holdings in principal amount of beneficial interests in such
Book-Entry Notes as shown on the records of DTC. Neither the Company nor the
Trustee or any Paying Agent will have any responsibility or liability for any
aspect of the records relating to or payments made on account of beneficial
ownership interests of Book-Entry Notes, or for maintaining, supervising or
reviewing any records relating to such beneficial interests. The Company also
expects that payments by participants to owners of beneficial interests in
Book-Entry Notes held through such participants will be governed by standing
customer instructions and customary practices, as is the case with securities
registered in "street name." Such instructions will be the responsibility of
such participants.
If DTC is at any time unwilling, unable or ineligible to continue as
depositary and a successor depositary is not appointed by the Company within 90
days, the Company will issue Notes in certificated form in exchange for
beneficial interests in the Book-Entry Notes. In addition, the Company may at
any time determine not to have its Notes represented by one or more Book-Entry
Notes, and, in such event, will issue Notes in certificated form in exchange for
beneficial interests in Book-Entry Notes. In any such instance, an owner of a
beneficial interest in a Book-Entry Note will be entitled to physical delivery
in certificated form of Notes equal in principal amount to such beneficial
interest and to have such Notes registered in its name. Notes so issued in
certificated form will be issued in denominations of $1,000 or any amount in
excess thereof that is an integral multiple of $1,000 and will be issued in
registered form only, without coupons.
SAME-DAY SETTLEMENT AND PAYMENT
Settlement for the Notes will be made by the Underwriters in immediately
available funds. All payments of principal and interest will be made by the
Company in immediately available funds.
Secondary trading in long-term notes and debentures of corporate issuers is
generally settled in clearing-house or next-day funds. In contrast, the Notes
are expected to trade in the Same-Day Funds Settlement System of DTC until
maturity, and, to the extent that secondary market trading activity in the Notes
is effected through the facilities of DTC, such trades will be settled in
immediately available
S-4
<PAGE>
funds. No assurance can be given as to the effect, if any, of settlement in
immediately available funds on trading activity in the Notes.
UNDERWRITING
Subject to the terms and conditions set forth in the Terms Agreement dated
February 3, 1995, which incorporates by reference the Underwriting Agreement
Basic Provisions dated November 28, 1989 (together, the "Underwriting
Agreement"), the Company has agreed to sell to each of the Underwriters named
below, and each of the Underwriters has severally agreed to purchase, the
principal amount of Notes set forth opposite its name below:
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT
NAME OF NOTES
- ----------------------------------------------------------------------------- ------------
<S> <C>
Smith Barney Inc. ........................................................... $150,000,000
CS First Boston Corporation.................................................. 50,000,000
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Total.................................................................... $200,000,000
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</TABLE>
The Underwriting Agreement provides that the obligations of the several
Underwriters to pay for and accept delivery of the Notes are subject to the
approval of certain legal matters by their counsel and to certain other
conditions. The Underwriters are committed to take and pay for all of the Notes
if any are taken.
The Underwriters propose to offer part of the Notes directly to the public
at the public offering price set forth on the cover page hereof and part to
certain dealers at a price that represents a concession not in excess of .350%
of the principal amount under the public offering price. Any Underwriter may
allow, and such dealers may reallow, a concession not in excess of .250% of the
principal amount to certain other dealers.
The Company has agreed to indemnify the several Underwriters against certain
liabilities, including liabilities under the Securities Act of 1933, as amended.
The Company does not intend to apply for listing of the Notes on a national
securities exchange, but has been advised by the Underwriters that they
presently intend to make a market in the Notes, as permitted by applicable laws
and regulations. The Underwriters are not obligated, however, to make a market
in the Notes, and any such market making may be discontinued at any time at the
sole discretion of the Underwriters. Accordingly, no assurance can be given as
to the liquidity of, or trading markets for, the Notes.
Certain of the Underwriters and their affiliates have engaged in
transactions with and performed services for the Company or one or more of its
affiliates in the ordinary course of business, and may do so in the future.
EXPERTS
The consolidated financial statements and schedules of the Company as of
December 31, 1993 and 1992, and for each of the years in the three-year period
ended December 31, 1993, included in the Company's Annual Report on Form 10-K
for the year ended December 31, 1993, have been incorporated by reference
herein, in reliance upon the report (also incorporated by reference herein) of
KPMG Peat Marwick LLP, independent certified public accountants, and upon the
authority of said firm as experts in accounting and auditing. The report of KPMG
Peat Marwick LLP covering the December 31, 1993 consolidated financial
statements and schedules refers to a change in the Company's methods of
accounting for postretirement benefits other than pensions and accounting for
postemployment benefits in 1993, and a change in the Company's method of
accounting for income taxes in 1992.
S-5
<PAGE>
LEGAL OPINIONS
The validity of the Notes offered hereby will be passed upon for the Company
by Charles O. Prince, III, Esq., as counsel for the Company, 65 East 55th
Street, New York, New York 10022 and for the Underwriters by Dewey Ballantine,
1301 Avenue of the Americas, New York, New York 10019-6092. Mr. Prince, Senior
Vice President, General Counsel and Secretary of the Company, beneficially owns,
or has rights to acquire under The Travelers Inc. employee benefit plans, an
aggregate of less than 1% of the common stock of The Travelers Inc. Dewey
Ballantine has from time to time acted as counsel for The Travelers Inc. and
certain of its subsidiaries and may do so in the future.
S-6
<PAGE>
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NO DEALER, SALESMAN OR ANY OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION, OR TO MAKE ANY REPRESENTATIONS, OTHER THAN THOSE CONTAINED IN THIS
PROSPECTUS SUPPLEMENT OR THE PROSPECTUS, IN CONNECTION WITH THE OFFER CONTAINED
IN THIS PROSPECTUS SUPPLEMENT AND THE PROSPECTUS, AND, IF GIVEN OR MADE, SUCH
INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN
AUTHORIZED BY THE COMPANY OR ANY UNDERWRITER. NEITHER THE DELIVERY OF THIS
PROSPECTUS SUPPLEMENT AND THE PROSPECTUS NOR ANY SALE MADE HEREUNDER OR
THEREUNDER SHALL UNDER ANY CIRCUMSTANCES CREATE AN IMPLICATION THAT THERE
HAS BEEN NO CHANGE IN THE AFFAIRS OF THE COMPANY SINCE THE DATE HEREOF. THIS
PROSPECTUS SUPPLEMENT AND THE PROSPECTUS ARE NOT AN OFFER TO SELL OR A
SOLICITATION OF AN OFFER TO BUY ANY SECURITY IN ANY JURISDICTION IN WHICH
IT IS UNLAWFUL TO MAKE SUCH OFFER OR SOLICITATION.
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TABLE OF CONTENTS
PAGE
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PROSPECTUS SUPPLEMENT
Capitalization........................ S-2
Ratio of Earnings to Fixed Charges.... S-2
Use of Proceeds....................... S-3
Description of Notes.................. S-3
Underwriting.......................... S-5
Experts............................... S-5
Legal Opinions........................ S-6
PROSPECTUS
Available Information................. 2
Incorporation of Certain Documents
by Reference........................ 3
The Company........................... 4
Use of Proceeds....................... 4
Ratio of Earnings to Fixed Charges.... 4
Description of Securities............. 5
Plan of Distribution.................. 12
ERISA Matters......................... 13
Experts............................... 13
Legal Matters......................... 13
$200,000,000
COMMERCIAL CREDIT
COMPANY
7 7/8% NOTES DUE FEBRUARY 1, 2025
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PROSPECTUS SUPPLEMENT
FEBRUARY 3, 1995
---------------------
SMITH BARNEY INC.
CS FIRST BOSTON
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