Pursuant to Rule 424(b)(2)
Reg. No. 33-50513 and 33-56553
PROSPECTUS SUPPLEMENT
(To Prospectus dated December 13, 1994)
COMMERCIAL CREDIT COMPANY
$200,000,000
7 3/4% Notes due March 1, 2005
Interest payable March 1 and September 1
ISSUE PRICE: 99.924%
Interest on the 7 3/4% Notes due March 1, 2005 (the "Notes") is payable
semiannually on March 1 and September 1 of each year, beginning September 1,
1995. The Notes will not be redeemable prior to maturity and will not be subject
to any sinking fund. The Notes will be represented by one or more Global
Securities registered in the name of The Depository Trust Company ("DTC") or its
nominee. Interests in the Global Securities will be shown on, and transfer
thereof will be effected only through, records maintained by DTC and its
participants. Except as provided herein, Notes in definitive form will not be
issued. See "Description of Notes--Book-Entry Notes."
The Notes will trade in the Same-Day Funds Settlement System of DTC until
maturity, and secondary market trading activity in the Notes will therefore
settle in immediately available funds. All payments of principal and interest
will be made by the Company in immediately available funds. See "Description of
Notes--Same-Day Settlement and Payment."
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.
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UNDERWRITING
PRICE TO DISCOUNTS AND PROCEEDS TO
PUBLIC(1) COMMISSIONS(2) COMPANY(1)(3)
<S> <C> <C> <C>
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Per Note 99.924% .479% 99.445%
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Total $199,848,000 $958,000 $198,890,000
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(1) Plus accrued interest from March 1, 1995 to the date of delivery.
(2) The Company has agreed to indemnify the Underwriter against certain
liabilities, including liabilities under the Securities Act of 1933, as
amended. See "Underwriting."
(3) Before deducting expenses payable by the Company, estimated at $75,000.
The Notes are offered, subject to prior sale, when, as and if accepted by the
Underwriter and subject to approval of certain legal matters by Dewey
Ballantine, counsel for the Underwriter. It is expected that delivery of the
Notes will be made on or about March 2, 1995 through the facilities of DTC
against payment therefor in same-day funds.
J.P. MORGAN SECURITIES INC.
February 23, 1995
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IN CONNECTION WITH THIS OFFERING, THE UNDERWRITER 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.
No person has been authorized to give any information or to make any
representations other than those contained or incorporated by reference 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 to
which they relate or any offer to sell or the solicitation of an offer to buy
such securities in any circumstance in which such offer or solicitation is
unlawful. Neither the delivery of this Prospectus Supplement or the Prospectus
nor any sale made hereunder 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 the information contained herein is correct as of any
time subsequent to its date.
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TABLE OF CONTENTS
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PROSPECTUS SUPPLEMENT
Capitalization....................................................................... S-3
Ratio of Earnings to Fixed Charges................................................... S-3
Use of Proceeds...................................................................... S-3
Description of Notes................................................................. S-4
Underwriting......................................................................... S-5
Experts.............................................................................. S-6
Legal Opinions....................................................................... S-6
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PROSPECTUS
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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
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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 issuance and sale of additional long-term debt of the Company after
December 31, 1994 through the date hereof, and the application of the proceeds
from each of these transactions to the repayment of short-term borrowings, as if
such transactions had occurred on December 31, 1994.
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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 1,904.6
Long-term debt................................................... 4,010.0 4,410.0
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Total debt................................................... $ 6,388.1 $ 6,388.1
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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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RATIO OF EARNINGS TO FIXED CHARGES
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YEAR ENDED DECEMBER 31,
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1994 1993 1992 1991 1990
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<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 these ratios, fixed charges consist of interest
expense and that portion of rentals deemed representative of the appropriate
interest factor.
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.
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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 23, 1995, $950,000,000 aggregate principal
amount of Securities remains currently available to be offered by the Company
under the Registration Statement 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 March 1,
1995, at the annual rate set forth on the cover page of this Prospectus
Supplement. The Notes will mature on March 1, 2005. Interest on the Notes will
be payable semiannually on March 1 and September 1, commencing September 1,
1995, to the persons in whose names the Notes are registered at the close of
business on the preceding February 15 or August 15, respectively. The Notes will
not be redeemable prior to maturity and will not be subject to any sinking fund.
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.
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
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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 Underwriter 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 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 23, 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 J.P. Morgan Securities Inc. (the
"Underwriter"), and the Underwriter has agreed to purchase, the entire principal
amount of the Notes.
The Underwriting Agreement provides that the obligations of the Underwriter
to pay for and accept delivery of the Notes are subject to the approval of
certain legal matters by its counsel and to certain other conditions. The
Underwriter is committed to take and pay for all of the Notes if any are taken.
The Underwriter initially proposes 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. The Underwriter
may allow, and such dealers may reallow, a concession not in excess of .250% of
the principal amount to certain other dealers. After the initial public
offering, the public offering price and such concessions may be changed.
The Company has agreed to indemnify the Underwriter 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 Underwriter that it presently
intends to make a market in the Notes, as permitted by applicable laws and
regulations. The Underwriter is 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 Underwriter. Accordingly, no assurance can be given as to the
liquidity of, or trading markets for, the Notes.
The Underwriter and its affiliates may engage in transactions (which may
include commercial banking transactions) with and perform services for the
Company or one or more of its affiliates in the ordinary course of business.
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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 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
changes in the Company's methods of accounting for postretirement benefits other
than pensions and accounting for postemployment benefits in 1993, and its method
of accounting for income taxes in 1992.
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 Underwriter 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.
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