PROSPECTUS SUPPLEMENT
(TO PROSPECTUS DATED SEPTEMBER 19, 1994)
$160,000,000
THE CONNECTICUT LIGHT AND POWER COMPANY
FIRST AND REFUNDING MORTGAGE 7 7/8% BONDS, 1996 SERIES A
DUE JUNE 1, 2001
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INTEREST PAYABLE JUNE 1 AND DECEMBER 1
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THE FIRST AND REFUNDING MORTGAGE 7 7/8% BONDS, 1996 SERIES A (1996 SERIES A
BONDS) MATURE ON JUNE 1, 2001. INTEREST ON THE 1996 SERIES A BONDS IS PAYABLE
SEMI-ANNUALLY ON JUNE 1 AND DECEMBER 1 BEGINNING DECEMBER 1, 1996. THE 1996
SERIES A BONDS WILL BE REDEEMABLE IN WHOLE OR IN PART, AT THE OPTION OF THE
CONNECTICUT LIGHT AND POWER COMPANY (THE COMPANY) AT ANY TIME, AT A REDEMPTION
PRICE EQUAL TO THE GREATER OF (I) 100% OF THEIR PRINCIPAL AMOUNT AND (II) THE
SUM OF THE PRESENT VALUES OF THE REMAINING SCHEDULED PAYMENTS OF PRINCIPAL AND
INTEREST THEREON DISCOUNTED TO THE DATE OF REDEMPTION ON A SEMIANNUAL BASIS
(ASSUMING A 360-DAY YEAR CONSISTING OF TWELVE 30-DAY MONTHS) AT THE TREASURY
YIELD (AS DEFINED HEREIN), PLUS IN EACH CASE ACCRUED INTEREST TO THE DATE OF
REDEMPTION. SEE "SUPPLEMENTAL DESCRIPTION OF THE 1996 SERIES A BONDS -- OPTIONAL
REDEMPTION" HEREIN. THE 1996 SERIES A BONDS WILL BE REPRESENTED BY A GLOBAL
SECURITY REGISTERED IN THE NAME OF THE DEPOSITORY TRUST COMPANY (DTC) OR ITS
NOMINEE. BOOK-ENTRY INTERESTS IN THE GLOBAL SECURITY WILL BE SHOWN ON, AND
TRANSFERS THEREOF WILL BE EFFECTED ONLY THROUGH, RECORDS MAINTAINED BY DTC OR
ITS NOMINEE.
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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 COMMIS-
SION 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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PRICE 99.950% AND ACCRUED INTEREST, IF ANY
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UNDERWRITING
PRICE TO DISCOUNTS AND PROCEEDS TO
PUBLIC (1) COMMISSIONS(2) COMPANY (3)
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PER BOND........... 99.950% .625% 99.325%
TOTAL.............. $159,920,000 $1,000,000 $158,920,000
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(1) PLUS ACCRUED INTEREST, IF ANY, FROM JUNE 25, 1996.
(2) THE COMPANY HAS AGREED TO INDEMNIFY THE SEVERAL UNDERWRITERS
AGAINST CERTAIN LIABILITIES, INCLUDING LIABILITIES UNDER THE
SECURITIES ACT OF 1933.
(3) BEFORE DEDUCTING EXPENSES PAYABLE BY THE COMPANY ESTIMATED AT $190,000.
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THE 1996 SERIES A BONDS ARE OFFERED BY THE UNDERWRITERS, SUBJECT TO
PRIOR SALE, WHEN, AS AND IF ISSUED BY THE COMPANY AND ACCEPTED BY THE
UNDERWRITERS AND SUBJECT TO APPROVAL OF CERTAIN LEGAL MATTERS BY WINTHROP,
STIMSON, PUTNAM & ROBERTS, COUNSEL FOR THE UNDERWRITERS. IT IS EXPECTED THAT
DELIVERY OF THE 1996 SERIES A BONDS WILL BE MADE ON OR ABOUT JUNE 25, 1996
THROUGH THE BOOK-ENTRY FACILITIES OF DTC, AGAINST PAYMENT THEREFOR IN NEW YORK
FUNDS.
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MORGAN STANLEY & CO. INCORPORATED
GOLDMAN, SACHS & CO.
CIBC WOOD GUNDY SECURITIES CORP.
FIRST CHICAGO CAPITAL MARKETS, INC.
SALOMON BROTHERS INC
JUNE 20, 1996
<PAGE>
IN CONNECTION WITH THIS OFFERING, THE UNDERWRITERS MAY OVER-ALLOT OR EFFECT
TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE SECURITIES
HEREBY OFFERED AT A LEVEL ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN
MARKET. SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME.
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SUMMARY INFORMATION
THE FOLLOWING MATERIAL IS QUALIFIED IN ITS ENTIRETY BY, AND SHOULD BE
CONSIDERED IN CONJUNCTION WITH, THE INFORMATION AND FINANCIAL STATEMENTS
APPEARING ELSEWHERE IN THIS PROSPECTUS SUPPLEMENT AND THE ACCOMPANYING
PROSPECTUS, AND IN THE DOCUMENTS AND INFORMATION INCORPORATED BY REFERENCE.
THE OFFERING
Securities Offered.................... $160,000,000 principal amount of First
and Refunding Mortgage 7 7/8% Bonds.
1996 Series A (1996 Series A Bonds).
Maturity.............................. June 1, 2001.
Interest Payment Dates................ June 1 and December 1, commencing
December 1, 1996.
SELECTED CONSOLIDATED FINANCIAL INFORMATION
(THOUSANDS, EXCEPT PERCENTAGES AND RATIOS)
<TABLE>
<CAPTION>
12 MONTHS
YEAR ENDED DECEMBER 31, ENDED
-------------------------------------------- MARCH 31,
1993(a) 1994 1995 1996
------- ---- ---- ---------
(UNAUDITED)
<S> <C> <C> <C> <C>
Income Summary:
Operating Revenues................................ $2,366,050 $ 2,328,052 $ 2,386,107 $ 2,445,229
Operating Income.................................. $ 241,655 $ 286,948 $ 324,026 $ 287,812
Income before cumulative effect of
accounting change............................. $ 143,702 $ 198,288 $ 205,216 $ 172,191
Cumulative effect of accounting change(b)......... $ 47,747 -- -- --
Net Income........................................ $ 191,449 $ 198,288 $ 205,216 $ 172,191
Total Assets (end of period)........................... $6,397,405 $ 6,217,457 $ 6,030,735 $ 5,933,992
</TABLE>
<TABLE>
<CAPTION>
AT MARCH 31, 1996
---------------------------------------------
(UNAUDITED)
AS % OF ADJUSTED
ACTUAL ADJUSTED(c) CAPITALIZATION
------ ----------- --------------
<S> <C> <C> <C>
Capitalization Summary:
Long-Term Debt (including current maturities)................. $1,824,204 $2,046,204 53.4%
Preferred Stock Subject to Mandatory Redemption
(including portion to be redeemed within one year)........ 155,000 155,000 4.1%
Preferred Stock Not Subject to Mandatory Redemption
(including portion to be redeemed within one year)........ 116,200 116,200 3.0%
Common Stockholder's Equity................................... 1,514,893 1,514,893 39.5%
---------- ---------- -------
Total Capitalization...................................... $3,610,297 $3,832,297 100.0%
========== ========== ======
</TABLE>
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31, 12 MONTHS ENDED
----------------------------------------- MARCH 31,
1991 1992 1993 1994 1995 1996
---- ---- ---- ---- ---- ------------
(UNAUDITED)
<S> <C> <C> <C> <C> <C> <C>
Ratio of Earnings to Fixed Charges................. 3.02 2.96 2.71 3.65 3.64 3.35
</TABLE>
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(a) Restated to reflect consolidated financial information for the Company and
its subsidiaries.
(b) The cumulative effect is the result of a one-time change in the Company's
method of accounting for property taxes that was booked during the first
quarter of 1993.
(c) Adjusted to reflect the proposed sale of $160 million principal amount of
1996 Series A Bonds and the net proceeds from the sale on May 21, 1996 by
the Connecticut Development Authority (CDA) of $62 million of its pollution
control revenue bonds, the proceeds of which were loaned by CDA to the
Company.
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SUPPLEMENTAL DESCRIPTION OF
THE 1996 SERIES A BONDS
This Prospectus Supplement relates to the offer and sale of $160,000,000
principal amount of First and Refunding Mortgage 7 7/8% Bonds, 1996 Series A,
due June 1, 2001 (1996 Series A Bonds) of The Connecticut Light and Power
Company (the Company). The 1996 Series A Bonds will be the second and final
series of New Bonds covered by the accompanying Prospectus (the Prospectus). The
section of the Prospectus entitled "Description of the New Bonds" contains
detailed information about the New Bonds. Set forth below is supplemental
information that more specifically relates to the 1996 Series A Bonds.
GENERAL
The 1996 Series A Bonds will be issued under a Supplemental Indenture dated
as of June 1, 1996 and will bear interest from the date of original issuance at
the rate of 7 7/8% per annum. Interest will be payable semiannually in arrears
on June 1 and December 1 of each year, commencing December 1, 1996, to
registered owners as of the close of business on the May 15 or November 15 next
preceding the interest payment dates, or if May 15 or November 15 falls on a day
on which banks are authorized to close in New York City, then as of the next
preceding banking day.
The 1996 Series A Bonds will be issued initially under a book-entry only
system in the form of one fully registered certificate, registered in the name
of Cede & Co., as registered bondholder and nominee of The Depository Trust
Company, New York, New York (DTC). DTC will act as securities depository for the
1996 Series A Bonds. So long as Cede & Co., as nominee of DTC, or any successor
nominee of DTC, is the registered bondholder of the 1996 Series A Bonds,
references herein and in the Prospectus to the bondholders or registered owners
of 1996 Series A Bonds will mean Cede & Co. or such successor nominee. See the
section in the Prospectus entitled "Book-Entry Only System" for certain
information regarding DTC and the book-entry only system.
For information concerning the requirements of the Indenture and for
additional general information about the Indenture and the New Bonds issuable
thereunder, see "Description of the New Bonds" in the Prospectus.
EARNINGS COVERAGE
The section of the Prospectus entitled "Description of the New
Bonds--Issuance of Additional Bonds, Earnings Coverage" sets forth information
about earnings coverage requirements of the Indenture. Because the 1996 Series A
Bonds will be issued against bonds that have been previously retired, redeemed,
cancelled or surrendered, the earnings coverage requirements of the Indenture
are not applicable to the issuance of the 1996 Series A Bonds. Based on the
bonds and prior lien obligations outstanding as of March 31, 1996 and after
giving effect to the sale of the 1996 Series A Bonds, the earnings coverage
would be 4.59 for the twelve months ended March 31, 1996, which would satisfy
such requirements.
OPTIONAL REDEMPTION
The 1996 Series A Bonds will be redeemable in whole or in part, at the
option of the Company at any time, at a redemption price equal to the greater of
(i) 100% of their principal amount and (ii) the sum of the present values of the
remaining scheduled payments of principal and interest thereon discounted to the
date of redemption on a semiannual basis (assuming a 360-day year consisting of
twelve 30-day months) at the Treasury Yield, plus in each case accrued interest
to the date of redemption (the Redemption Date).
"Treasury Yield" means, with respect to any Redemption Date, the rate per
annum equal to the semiannual equivalent yield to maturity of the Comparable
Treasury Issue, assuming 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.
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"Comparable Treasury Issue" means the United States Treasury security
selected by an Independent Investment Banker having a maturity comparable to the
remaining term of the 1996 Series A Bonds 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 1996 Series A Bonds. "Independent Investment Banker" means Morgan Stanley
& Co. Incorporated or, if such firm is unwilling or unable to select the
Comparable Treasury Issue, an independent investment banking institution of
national standing selected by the Company and appointed by the Trustee.
"Comparable Treasury Price" means, with respect to any Redemption Date, (i)
the average of the bid and asked prices for the Comparable Treasury Issue
(expressed in each case as a percentage of its principal amount) on the third
business day preceding such Redemption Date, as set forth in the daily
statistical release (or any successor release) published by the Federal Reserve
Bank of New York and designated "Composite 3:30 p.m. Quotations for U.S.
Government Securities" or (ii) if such release (or any successor release) is not
published or does not contain such prices on such business day, (A) the average
of the Reference Treasury Dealer Quotations for such Redemption Date, after
excluding the highest and lowest such Reference Treasury Dealer Quotations, or
(B) if the Trustee obtains fewer than four Reference Treasury Dealer Quotations,
the average of all such Quotations. "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 such Reference Treasury
Dealer at 5:00 p.m. on the third business day preceding such Redemption Date.
"Reference Treasury Dealer" means each of Morgan Stanley & Co.
Incorporated, Goldman, Sachs & Co. and another Primary Treasury Dealer (as
defined herein) at the option of the Company, PROVIDED, HOWEVER, that if any of
the foregoing shall cease to be a primary U.S. Government securities dealer in
New York City (a Primary Treasury Dealer), the Company shall substitute therefor
another Primary Treasury Dealer.
Holders of 1996 Series A Bonds to be redeemed will receive notice thereof
sent by first-class mail at least 30 and not more than 60 days prior to the date
fixed for redemption.
SINKING AND IMPROVEMENT FUND
If the Company seeks to eliminate or modify the requirements of the annual
sinking and improvement fund, and subject to the receipt of any required
regulatory approvals, the holders of the New Bonds, including the 1996 Series A
Bonds, will be deemed to have consented to any such amendment or amendments of
the Indenture. See "Description of the New Bonds--Sinking and Improvement Fund"
in the Prospectus.
DIVIDEND RESTRICTIONS
See "Description of the New Bonds--Dividend Restrictions" in the Prospectus
for information about dividend limitations binding on the Company so long as
certain prior series of bonds are outstanding. The most restrictive provisions
currently binding on the Company are set forth in the Supplemental Indenture
dated as of July 1, 1992, under which $100,000,000 principal amount of Series VV
Bonds due July 1, 1999 were issued. Under these provisions, which are applicable
so long as any Series VV Bonds are outstanding, unrestricted earned surplus at
March 31, 1996 would have been $214,167,629.
OTHER FINANCIAL RESTRICTIONS
For information on financial restrictions applicable to the Company, see
"Description of the New Bonds--Other Financial Restrictions" in the Prospectus
and the Company's 1995 Annual Report on Form 10-K under the caption "Item 1.
Business--Financing Program--Financing Limitations." At March 31, 1996, the
Company's equity ratio (calculated in accordance with the Connecticut Department
of Public Utility Control decision approving Northeast Utilities' acquisition of
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Public Service Company of New Hampshire, which decision requires the inclusion
of short-term debt in excess of 7% of total capitalization) was 42.3%.
USE OF PROCEEDS
The net proceeds from the issue and sale of the 1996 Series A Bonds, plus
funds from other sources, will be used to repay approximately $193,288,000 in
principal amount of the Company's Series UU Bonds, due April 1, 1997. Prior to
the maturity of the Series UU bonds, the Company may utilize a portion of the
net proceeds to reduce short-term borrowing requirements.
INCORPORATION OF CERTAIN
DOCUMENTS BY REFERENCE
Reference is made to "Incorporation of Certain Documents by Reference" in
the Prospectus. At the date of this Prospectus Supplement, the documents
incorporated by reference or deemed to be incorporated by reference and filed in
1996 consist of the Company's Annual Report on Form 10-K for the year ended
December 31, 1995, its Quarterly Report on Form 10-Q for the quarter ended March
31, 1996 and its Current Reports on Form 8-K dated January 31, March 30, April
15, June 6 and June 18, 1996.
UNDERWRITERS
Under the terms and subject to the conditions contained in an Underwriting
Agreement dated June 20, 1996, the underwriters named below (the Underwriters)
have severally agreed to purchase from the Company, and the Company has agreed
to sell to them, severally, the respective principal amounts of the 1996 Series
A Bonds set forth opposite their respective names below.
PRINCIPAL AMOUNT
OF 1996
NAME SERIES A BONDS
---- -------------------
Morgan Stanley & Co. Incorporated ..................... $ 50,000,000
Goldman, Sachs & Co. .................................. 50,000,000
CIBC Wood Gundy Securities Corp. ...................... 20,000,000
First Chicago Capital Markets, Inc. ................... 20,000,000
Salomon Brothers Inc .................................. 20,000,000
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Total ......................................... $160,000,000
============
The Underwriting Agreement provides that the obligation of the Underwriters
to pay for and accept delivery of the 1996 Series A Bonds is subject to the
approval of certain legal matters by their counsel and to certain other
conditions. The Underwriters' obligations are such that they are committed to
take and pay for all of the 1996 Series A Bonds offered hereby if any are taken,
provided, that under certain circumstances involving a default of an
Underwriter, less than all of the 1996 Series A Bonds may be purchased. Default
by one Underwriter would not relieve the non-defaulting Underwriters from their
several obligations, and in the event of such a default, the non-defaulting
Underwriters may be required by the Company to purchase the principal amount of
the 1996 Series A Bonds that they have severally agreed to purchase and, in
addition, to purchase the principal amount of the 1996 Series A Bonds that the
defaulting Underwriter or Underwriters shall have failed to purchase, severally
and not jointly, up to a principal amount equal to one-ninth of the principal
amount of the 1996 Series A Bonds that such non-defaulting Underwriters have
otherwise agreed to purchase.
The Underwriters initially propose to offer part of the 1996 Series A Bonds
directly to the public at the public offering price set forth on the cover page
of this Prospectus Supplement and part to certain dealers at a price which
represents a concession not in excess of .375% of the principal amount of the
1996 Series A Bonds. The Underwriters may allow, and such dealers may reallow, a
concession not in excess of .250% of the principal amount of the 1996 Series A
Bonds to certain other dealers. After the initial public offering, the public
offering price and concessions may be changed.
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<PAGE>
The Company does not intend to apply for listing of the 1996 Series A Bonds
on a national securities exchange, but has been advised by the Underwriters that
they presently intend to make a market in the 1996 Series A Bonds, as permitted
by applicable law and regulations. The Underwriters are not obligated, however,
to make a market in the 1996 Series A Bonds, and any such market making may be
discontinued at any time at the sole discretion of the Underwiters. Accordingly,
no assurance can be given as to the liquidity of the trading market for the 1996
Series A Bonds.
The Company has agreed to indemnify the Underwriters against certain
liabilities, including liabilities under the Securities Act of 1933.
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