<PAGE>
Filed Pursuant to Rule 424(b)(5)
File No. 33-51593
PROSPECTUS SUPPLEMENT
(TO PROSPECTUS DATED DECEMBER 12, 1996)
$65,000,000
NORTHERN STATES POWER COMPANY
(A WISCONSIN CORPORATION)
----------------
FIRST MORTGAGE BONDS, SERIES DUE DECEMBER 1, 2026, 7 3/8%
Interest on the First Mortgage Bonds, Series due December 1, 2026, 7 3/8%
(the "Offered Bonds") is payable on June 1 and December 1 of each year,
commencing June 1, 1997. The Offered Bonds are redeemable in whole or in part at
the option of the Company at the redemption prices set forth herein, provided
that the Offered Bonds are not redeemable prior to December 1, 2006. See
"Supplemental Description of Offered Bonds".
The Offered Bonds will be represented by a global security registered in the
name of a nominee of The Depository Trust Company, as depository ("DTC").
Beneficial interests in the Offered Bonds will be shown on, and transfers
thereof will be effected only through, records maintained by DTC and its
participants. Except as described herein, Offered Bonds in definitive form will
not be issued. So long as the Offered Bonds are registered in the name of DTC or
its nominee, the Offered Bonds will trade in DTC's Same-Day Funds Settlement
System and secondary market trading activity in the Offered Bonds will,
therefore, settle in immediately available funds. All payments of principal and
interest on the global security will be made by the Company in immediately
available funds.
------------------------
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>
<CAPTION>
UNDERWRITING
PRICE TO DISCOUNTS AND PROCEEDS TO
PUBLIC (1) COMMISSIONS (2) COMPANY (1)(3)
<S> <C> <C> <C>
Per Bond........................................... 99.587% .570% 99.017%
Total.............................................. $64,731,550 $370,500 $64,361,050
<FN>
(1) Plus accrued interest from December 1, 1996.
(2) The Company has agreed to indemnify the Underwriter against certain
liabilities, including liabilities under the Securities Act of 1933, as
amended.
(3) Before deducting estimated expenses of $165,000 payable by the Company.
</TABLE>
------------------------
The Offered Bonds are offered, subject to prior sale, when, as and if
delivered to and accepted by the Underwriter, and subject to certain other
conditions. The Underwriter reserves the right to withdraw, cancel or modify
such offer and to reject orders in whole or in part. It is expected that the
Offered Bonds will be delivered in book-entry form only, on or about December
19, 1996, through the facilities of DTC against payment therefor in immediately
available funds.
------------------------
BEAR, STEARNS & CO. INC.
DECEMBER 12, 1996.
<PAGE>
IN CONNECTION WITH THIS OFFERING, THE UNDERWRITERS MAY OVER-ALLOT OR EFFECT
TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE OFFERED BONDS
OR ANY OTHER SECURITIES OF THE COMPANY AT LEVELS ABOVE THOSE WHICH MIGHT
OTHERWISE PREVAIL IN THE OPEN MARKET. SUCH STABILIZING, IF COMMENCED, MAY BE
DISCONTINUED AT ANY TIME.
------------------------
USE OF PROCEEDS
The net proceeds from the sale of $65,000,000 in aggregate principal amount
of the Offered Bonds will be added to the general funds of the Company and
applied to the redemption of $44,635,000 aggregate principal amount of its First
Mortgage Bonds, Series due April 1, 2021, 9 1/8% (the "Prior Bonds") at a
redemption price of 105.344 percent of the principal amount to be redeemed. The
balance of the net proceeds will be used to repay short-term borrowings.
SUPPLEMENTAL DESCRIPTION OF OFFERED BONDS
The following description of the particular terms of the Offered Bonds
supplements the description of the general terms and provisions of the New Bonds
set forth in the accompanying Prospectus under the caption "Description of New
Bonds," to which description reference is hereby made. The following brief
summaries of certain provisions contained in the Supplemental Trust Indenture,
dated December 1, 1996, relating to the Offered Bonds (the "New Supplemental
Indenture") do not purport to be complete, use certain terms defined in the New
Supplemental Indenture, and are qualified in their entirety by express reference
to the provisions of the New Supplemental Indenture. Capitalized words not
defined herein are used as defined in the accompanying Prospectus or the New
Supplemental Indenture.
GENERAL
Interest on the Offered Bonds at the annual rate set forth on the cover page
of this Prospectus Supplement will accrue from December 1, 1996, and is to be
payable semi-annually on June 1 and December 1, beginning June 1, 1997. Subject
to certain exceptions, the New Supplemental Indenture provides for the payment
of interest on the interest payment date only to persons in whose names the
Offered Bonds are registered on the Record Date (the May 21 prior to June 1 and
the November 20 prior to December 1 unless any Record Date is not a Business
Day, in which event the Record Date will be the next preceding Business Day).
Following the issuance of the Offered Bonds and the redemption of the Prior
Bonds, three series of Bonds in an aggregate principal amount of $215,000,000
will be outstanding under the Indenture.
REDEMPTION PROVISIONS
OPTIONAL REDEMPTION. The Offered Bonds will be redeemable, at the option of
the Company, as a whole or in part on any date upon not less than 30 days'
previous notice, at the principal amount thereof plus accrued interest thereon
to the date of redemption and the applicable premium on the principal amount as
specified below under the caption "Regular Redemption Premium," provided that no
Offered Bonds shall be redeemed prior to December 1, 2006. If less than all the
Offered Bonds are to be redeemed, the particular Offered Bonds to be redeemed
shall be selected by the Trustee by lot. The selection for partial redemption of
any Offered Bonds held in the DTC book-entry system will be made in accordance
with DTC's established procedures.
<TABLE>
<CAPTION>
IF REDEEMED DURING THE REGULAR
TWELVE MONTH PERIOD REDEMPTION
BEGINNING DECEMBER 1 PREMIUM
- ----------------------- -----------
<S> <C>
2006 3.481%
2007 3.133
2008 2.785
2009 2.437
<CAPTION>
IF REDEEMED DURING THE REGULAR
TWELVE MONTH PERIOD REDEMPTION
BEGINNING DECEMBER 1 PREMIUM
- ----------------------- -----------
<S> <C>
2010 2.089%
2011 1.741
2012 1.392
2013 1.044
<CAPTION>
IF REDEEMED DURING THE REGULAR
TWELVE MONTH PERIOD REDEMPTION
BEGINNING DECEMBER 1 PREMIUM
- ----------------------- -----------
<S> <C>
2014 0.696%
2015 0.348
2016 and thereafter None
</TABLE>
SINKING FUND REDEMPTION. The Offered Bonds will not be subject to mandatory
sinking fund redemption.
S-2
<PAGE>
BOOK-ENTRY BONDS
The Offered Bonds will be issued initially as global securities and,
accordingly, will be represented by a fully-registered global security (the
"Global Security") in the aggregate principal amount of the Offered Bonds. The
Global Security will be deposited with, or on behalf of, DTC, or its successor,
as depository (the "Depository"), and registered in the name of the Depository
or a nominee of the Depository.
So long as the Depository, or its nominee, is the registered owner of a
Global Security, such Depository or such nominee, as the case may be, will be
considered the owner of such Global Security for all purposes, including any
notices and voting. Except in the circumstances described below, the owners of
beneficial interests in a Global Security will not be entitled to have any
individual Offered Bonds registered in their names, will not receive or be
entitled to receive physical delivery of any such Offered Bonds and will not be
considered the owners of Offered Bonds under the Indenture. Accordingly, each
person holding a beneficial interest in a Global Security must rely on the
procedures of the Depository and, if such person is not a Direct Participant (as
defined below), on procedures of the Direct Participant through which such
person holds its interest, to exercise any of the rights of a registered owner
of such Offered Bonds.
If the Depository is at any time unwilling or unable to continue as
depository and a successor depository is not appointed, the Company will issue
individual securities in certificated form ("Certificated Securities") in
exchange for the Global Security or Global Securities representing the
corresponding book-entry Offered Bonds represented by one or more Global
Securities. Further, in such event, an owner of a beneficial interest in a
Global Security representing book-entry Offered Bonds may, on terms acceptable
to the Company and the Depository for such Global Security, receive such
book-entry Offered Bonds as Certificated Securities. In any such instance, an
owner of a beneficial interest in a Global Security representing book-entry
Offered Bonds will be entitled to physical delivery of individual Certificated
Securities equal in principal amount to such beneficial interest and to have
such Certificated Securities registered in the name of such owner. Certificated
Securities will be issued as fully registered Offered Bonds in denominations of
$1,000.
DTC will act as securities depository for the Global Security. The Offered
Bonds will be registered in the name of Cede & Co. (DTC's partnership nominee).
One fully-registered Global Security certificate will be issued in the aggregate
principal amount of the Offered Bonds, and will be deposited with DTC.
DTC is a limited-purpose trust company organized under the New York Banking
Law, a "banking organization" within the meaning of the New York Banking Law, a
member of the Federal Reserve System, a "clearing corporation" within the
meaning of the New York Uniform Commercial Code, and a "clearing agency"
registered pursuant to the provisions of Section 17A of the Securities Exchange
Act of 1934. DTC holds securities that its participants ("Participants") deposit
with DTC. DTC also facilitates the settlement among Participants of securities
transactions, such as transfers and pledges, in deposited securities through
electronic computerized book-entry changes in Participants' accounts, thereby
eliminating the need for physical movement of securities certificates. Direct
Participants include securities brokers and dealers, banks, trust companies,
clearing corporations, and certain other organizations. DTC is owned by a number
of its Direct Participants and by the New York Stock Exchange, Inc., the
American Stock Exchange, Inc., and the National Association of Securities
Dealers, Inc. Access to the DTC system is also available to others such as
securities brokers and dealers, banks, and trust companies that clear through or
maintain a custodial relationship with a Direct Participant, either directly or
indirectly ("Indirect Participants"). The Rules applicable to DTC and its
Participants are on file with the Commission.
Purchases of the Global Securities under the DTC system must be made by or
through Direct Participants, which will receive a credit for such purchases of
Global Securities on DTC's records. The ownership interest of each actual
purchaser of each Global Security ("Beneficial Owner") is in turn to be recorded
on the Direct and Indirect Participants' records. Beneficial Owners will not
receive written confirmation from DTC of their purchase, but Beneficial Owners
are expected to receive written confirmations providing details of the
transaction, as well as periodic statements of their holdings, from the Direct
or Indirect Participant through which the Beneficial Owner entered into the
transaction. Transfers of ownership interests in the Global Securities are to be
accomplished by entries made on the books of Participants acting
S-3
<PAGE>
on behalf of Beneficial Owners. Beneficial Owners will not receive certificates
representing their ownership interests in the Global Securities, except in the
event that use of the book-entry system for the Global Securities is
discontinued.
To facilitate subsequent transfers, all Global Securities deposited by
Participants with DTC are registered in the name of DTC's partnership nominee,
Cede & Co. The deposit of the Global Securities with DTC and their registration
in the name of Cede & Co. effect no change in beneficial ownership. DTC has no
knowledge of the actual Beneficial Owners of the Global Securities; DTC's
records reflect only the identity of the Direct Participants to whose accounts
such Global Securities are credited, which may or may not be the Beneficial
Owners. The Participants will remain responsible for keeping account of their
holdings on behalf of their customers.
Conveyance of notices and other communications by DTC to Direct
Participants, by Direct Participants to Indirect Participants, and by Direct
Participants to Beneficial Owners will be governed by arrangements among them,
subject to any statutory or regulatory requirements as may be in effect from
time to time.
Redemption notices shall be sent to Cede & Co. If less than all of the
Global Securities within an issue are being redeemed, DTC's practice is to
determine by lot the amount of the interest of each Direct Participant in such
issue to be redeemed.
Neither DTC nor Cede & Co. will consent or vote with respect to the Global
Securities. Under its usual procedures, DTC mails an Omnibus Proxy to the
Company as soon as possible after the record date. The Omnibus Proxy assigns
Cede & Co.'s consenting or voting rights to those Direct Participants to whose
accounts the Global Securities are credited on the record date (identified in a
listing attached to the Omnibus Proxy).
Principal and interest payments on the Global Securities will be made to
DTC. DTC's practice is to credit Direct Participants' accounts on payable date
in accordance with their respective holdings shown on DTC's records unless DTC
has reason to believe that it will not receive payment on payable date. Payments
by Participants to Beneficial Owners will be governed by standing instructions
and customary practices, as is the case with securities held for the accounts of
customers in bearer form or registered in "street name," and will be the
responsibility of such Participant and not of DTC, the Trustee, or the Company,
subject to any statutory or regulatory requirements as may be in effect from
time to time. Payment of principal and interest on the Offered Bonds represented
by Global Securities to DTC is the responsibility of the Company or the Trustee.
Disbursement of such payments to Direct Participants shall be the responsibility
of DTC, and disbursement of such payments to the Beneficial Owners shall be the
responsibility of Direct and Indirect Participants.
DTC may discontinue providing its services as securities depository with
respect to the Global Securities at any time by giving reasonable notice to the
Company or the Trustee. Under such circumstances, if a successor securities
depository is not obtained, Offered Bonds in certificated form are required to
be printed and delivered.
The Company may decide to discontinue use of the system of book-entry
transfers through DTC (or a successor securities depository). In that event,
Global Security certificates will be printed and delivered.
The information in this section concerning DTC and DTC's book-entry system
has been obtained from DTC, and the Company and the Underwriter take no
responsibility for the accuracy thereof.
The Underwriter is a Direct Participant of DTC.
None of the Company, the Trustee, or any agent for payment on or
registration of transfer or exchange of any Global Security will have any
responsibility or liability for any aspect of the records relating to or
payments made on account of beneficial interests in such Global Security or for
maintaining, supervising or reviewing any records relating to such beneficial
interests.
SAME-DAY SETTLEMENT AND PAYMENT
Settlement for the Offered Bonds 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.
S-4
<PAGE>
Secondary trading in long-term notes and debentures of corporate issuers is
generally settled in clearinghouse or next-day funds. In contrast, the Offered
Bonds will trade in the DTC's Same-Day Funds Settlement System until maturity or
until the Offered Bonds are issued in certificated form, and secondary market
trading activity in the Offered Bonds will therefore be required by DTC to
settle 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 Offered Bonds.
UNDERWRITING
Subject to the terms and conditions set forth in the Underwriting Agreement
relating to the Offered Bonds, the Company has agreed to sell to Bear, Stearns &
Co. Inc. (the "Underwriter"), and the Underwriter has agreed to purchase, the
Offered Bonds.
The Underwriting Agreement provides that the obligations of the Underwriter
are subject to certain conditions precedent and that the Underwriter will be
obligated to purchase all of the Offered Bonds if any are purchased.
The Underwriter has advised the Company that it proposes to offer all or
part of the Offered Bonds directly to retail purchasers at the initial public
offering price set forth on the cover page of this Prospectus Supplement, and to
certain securities dealers at such price less a concession not in excess of
.350% of the principal amount of the Offered Bonds. The Underwriter may allow
and such dealers may reallow to certain brokers and dealers a concession not in
excess of .250% of the principal amount of the Offered Bonds. After the Offered
Bonds are released for sale to the public, the offering price and other selling
terms may from time to time be varied.
The Company has been advised by the Underwriter that it intends to make a
market in the Offered Bonds, but it is not obligated to do so and may
discontinue such market-making at any time without notice. No assurance can be
given as to the liquidity of the trading market for the Offered Bonds.
The Underwriting Agreement provides that the Company will indemnify the
Underwriter against certain liabilities, including liabilities under the
Securities Act of 1933, as amended, or contribute to payments the Underwriter
may be required to make in respect thereof.
S-5
<PAGE>
(This page has been left blank intentionally.)
<PAGE>
PROSPECTUS
NORTHERN STATES POWER COMPANY
(A WISCONSIN CORPORATION)
FIRST MORTGAGE BONDS
-----------
Northern States Power Company, a Wisconsin corporation (the "Company"), may
offer for sale from time to time up to $65,000,000 aggregate principal amount of
its First Mortgage Bonds (the "New Bonds"), in one or more series, on terms and
in amounts to be determined at the time of sale. The aggregate principal amount,
rate or rates (or method of calculation) and time or times and place of payment
of interest, maturity or maturities, offering price, any redemption terms or
other specific terms of the series of New Bonds in respect of which this
Prospectus is being delivered (the "Offered Bonds") will be set forth in a
supplement to this Prospectus (the "Prospectus Supplement").
The Company may sell the New Bonds through underwriters or dealers, directly
to a limited number of institutional purchasers or through agents. See "Plan of
Distribution." The Prospectus Supplement will set forth the names of any
underwriters, dealers or agents involved in the distribution of the Offered
Bonds and any applicable commissions or discounts and the net proceeds to the
Company from such sale.
--------------
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. ANY REPRESENTATION
TO THE CONTRARY IS A CRIMINAL OFFENSE.
--------------
The date of this Prospectus is December 12, 1996.
<PAGE>
NO DEALER, SALESMAN OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS, OTHER THAN THOSE CONTAINED OR
INCORPORATED BY REFERENCE IN THIS 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 OR AGENT. NEITHER THE DELIVERY OF THIS
PROSPECTUS NOR ANY SALE MADE HEREUNDER 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 DOES NOT CONSTITUTE AN OFFER TO SELL OR A
SOLICITATION OF AN OFFER TO BUY THE NEW BONDS IN ANY JURISDICTION TO ANY PERSON
TO WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER OR SOLICITATION IN SUCH JURISDICTION.
This Prospectus and the documents incorporated by reference herein,
including statements regarding the anticipated impact of the proposed merger,
contain certain forward-looking statements and information that are subject to
certain risks, uncertainties and assumptions. Such forward-looking statements
are intended to be identified in this document by the words "anticipate",
"estimate", "expect", "objective", "possible", "potential" and similar
expressions. Actual results may vary materially. Factors that could cause actual
results to differ materially include, but are not limited to: general economic
conditions, including their impact on capital expenditures; business conditions
in the energy industry; competitive factors; unusual weather; regulatory
decisions regarding the proposed combination of the Company and Wisconsin Energy
Company; and the other risk factors listed in Exhibit 99.01 to the Company's
report on Form 10-Q for the quarter ended September 30, 1996.
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance
therewith files reports and other information with the Securities and Exchange
Commission (the "Commission"). Such reports and other information on file can be
inspected at the public reference offices of the Commission currently at 450
Fifth Street, N.W., Washington, D.C. 20549; 500 West Madison Street, Chicago,
Illinois 60661; and 7 World Trade Center, New York, New York 10048. Copies of
such material can be obtained from the Public Reference Section of the
Commission at its principal office at 450 Fifth Street, N.W., Washington, D.C.
20549, at prescribed rates. In addition, electronically filed documents,
including reports, proxy and information statements and other information
regarding the Company, can be obtained from the Commission's Web site at
http://www.sec.gov. The Company is not required to, and does not, provide annual
reports to holders of its debt securities unless specifically requested by a
holder.
The Company has filed with the Commission a registration statement on Form
S-3 (herein, together with all amendments and exhibits, referred to as the
"Registration Statement") under the Securities Act of 1933, as amended. This
Prospectus does not contain all of the information set forth in the Registration
Statement, certain parts of which are omitted in accordance with the rules and
regulations of the Commission. For further information, reference is made to the
Registration Statement.
DOCUMENTS INCORPORATED BY REFERENCE
The following documents filed by the Company with the Commission are
incorporated by reference into this Prospectus:
1. The Company's Annual Report on Form 10-K for the year ended December 31,
1995, as amended by Form 10-K/A filed on May 31, 1996 (collectively, the
"1995 Form 10-K"); and
2. The Company's Quarterly Reports on Form 10-Q for the quarters ended
March 31, 1996, June 30, 1996 and September 30, 1996 (the "September 1996
Form 10-Q").
All documents filed by the Company pursuant to Section 13(a), 13(c), 14 or
15(d) of the Exchange Act after the date of this Prospectus and prior to the
termination of this offering shall be deemed to be incorporated by reference in
this Prospectus from the date of filing of such documents. Any statement
contained in a document incorporated or deemed to be incorporated by reference
in this Prospectus shall be deemed to be modified or superseded for purposes of
this Prospectus to the extent that a statement contained in this Prospectus or
in any other subsequently filed document which also is or is deemed to be
incorporated by reference in this Prospectus modifies or supersedes such
statement. Any statement so modified or superseded shall not be deemed, except
as so modified or superseded, to constitute a part of this Prospectus.
THE COMPANY WILL PROVIDE WITHOUT CHARGE TO EACH PERSON (INCLUDING ANY
BENEFICIAL OWNER) TO WHOM A COPY OF THIS PROSPECTUS HAS BEEN DELIVERED, UPON THE
WRITTEN OR ORAL REQUEST OF ANY SUCH PERSON, A COPY OF ANY OR ALL OF THE
DOCUMENTS REFERRED TO ABOVE WHICH HAVE BEEN INCORPORATED IN THIS PROSPECTUS BY
REFERENCE, OTHER THAN EXHIBITS TO SUCH DOCUMENTS. REQUESTS FOR SUCH COPIES
SHOULD BE DIRECTED TO THE TREASURER, NORTHERN STATES POWER COMPANY, P.O. BOX 8,
EAU CLAIRE, WISCONSIN 54702 (715-839-2416).
2
<PAGE>
[LOGO]
Northern States Power Company (the "Company"), incorporated in 1901 under
the laws of Wisconsin as the La Crosse Gas and Electric Company, is an operating
public utility company with executive offices at 100 North Barstow Street, Eau
Claire, Wisconsin 54702-0008 (phone: 715-839-2416). The Company is a
wholly-owned subsidiary of Northern States Power Company, a Minnesota
corporation (the "Minnesota Company").
The Company is engaged in the production, transmission and distribution of
electricity to approximately 202,000 retail customers in an area of
approximately 18,900 square miles in northwestern Wisconsin, to approximately
9,200 electric retail customers in an area of approximately 300 square miles in
the western portion of the Upper Peninsula of Michigan, and to 10 wholesale
customers in the same general area. The Company is also engaged in the
distribution and sale of natural gas in the same service territory to
approximately 67,000 customers in Wisconsin and 4,800 customers in Michigan. In
Wisconsin, some of the larger communities to which the Company provides natural
gas are Eau Claire, Chippewa Falls, La Crosse, Hudson, Menomonie and Ashland. In
the Upper Peninsula of Michigan the largest community to which the Company
provides natural gas is Ironwood. In 1995, the Company derived 83 percent of its
total operating revenues from electric utility operations and 17 percent from
gas utility operations.
PROPOSED MERGER
The Minnesota Company, Wisconsin Energy Corporation, a Wisconsin corporation
("WEC"), Northern Power Wisconsin Corp., a Wisconsin corporation and
wholly-owned subsidiary of the Minnesota Company, and WEC Sub Corp., a Wisconsin
corporation and wholly-owned subsidiary of WEC, have entered into an Agreement
and Plan of Merger, dated as of April 28, 1995, as amended and restated as of
July 26, 1995 (the "Merger Agreement"), which provides for a strategic business
combination involving the Minnesota Company and WEC in a "merger-of-equals"
transaction (the "Transaction"). The Transaction, which was unanimously approved
by the Boards of Directors of the constituent companies and approved by the
shareholders of both the Minnesota Company and WEC, is expected to close shortly
after all of the conditions to the consummation of the Transaction, including
obtaining applicable regulatory approvals, are met or waived. The goal of the
Minnesota Company and WEC was to receive approvals from all regulatory
authorities by the end of 1996. However, it appears that all necessary
regulatory approvals will not be obtained by the end of 1996, and as a result,
the merger will not be completed during 1996. If this is the case, the Minnesota
Company and WEC will continue to pursue regulatory approvals and completion of
the merger as soon as possible in 1997.
In the Transaction, the holding company of the combined enterprise will be
registered under the Public Utility Holding Company Act of 1935, as amended. The
holding company will be named Primergy Corporation ("Primergy") and will be the
parent company of both the Minnesota Company (which, for regulatory reasons,
will reincorporate in Wisconsin) and of WEC's present utility subsidiary,
Wisconsin Electric Power Company ("WEPCO") which will be renamed "Wisconsin
Energy Company." It is anticipated that, following the Transaction, except for
certain gas distribution properties serving the cities of LaCrosse and Hudson,
Wisconsin that will be transferred to the Minnesota Company, the Company will be
merged into Wisconsin Energy Company (the "Company Merger").
The Transaction is subject to customary closing conditions, including,
without limitation, the receipt of all necessary governmental approvals and the
making of all necessary governmental filings, all as more fully described in the
1995 Form 10-K and the September 1996 Form 10-Q. Additional information
concerning the Transaction and the Merger Agreement is included in the 1995 Form
10-K and the September 1996 Form 10-Q.
Both the Company and WEPCO recognize that the divestiture of their existing
gas operations is a possibility under the new registered holding company
structure, but will seek approval from the
3
<PAGE>
Commission to maintain such businesses. If divestiture is ultimately required,
the Commission has historically allowed companies sufficient time to accomplish
divestitures in a manner that protects shareholder value.
Following the completion of the Company Merger, the New Bonds and the
Company's other outstanding first mortgage bonds will be obligations of
Wisconsin Energy Company, as a subsidiary of Primergy, and will continue to be
secured by the Indenture as described in this Prospectus. See "DESCRIPTION OF
NEW BONDS -- Security for New Bonds." However, as described above, the New Bonds
will not be an obligation of Primergy or any other subsidiary of Primergy. The
1995 Form 10-K and September 1996 Form 10-Q include pro forma financial
information for Wisconsin Energy Company following the Company Merger.
USE OF PROCEEDS
The proceeds from the sale of the New Bonds will be added to the general
funds of the Company and used for general corporate purposes, which may include
the purchase or redemption of one or more series of outstanding first mortgage
bonds and the repayment of outstanding short-term borrowings incurred in
connection with the Company's continuing construction program. Short-term
borrowings of the Company aggregated $64 million as of November 30, 1996. The
specific allocation of the proceeds of a particular series of the Offered Bonds
will be described in the Prospectus Supplement.
CONSTRUCTION PROGRAM AND FINANCING
The Company's construction program for 1996-2000, including allowance for
funds used during construction, is presently estimated to be $303 million (1996:
$53.8 million; 1997: $59.7 million; 1998: $68.5 million; 1999: $64.0 million;
and 2000: $56.6 million). Of these construction expenditures, approximately 89%
are expected to be provided by internally generated funds. The foregoing
estimates of construction expenditures and internally generated funds may be
subject to substantial changes due to unforeseen factors, such as changed
economic conditions, competitive conditions, technological innovations, new
government regulations, changed tax laws and rate regulation. In addition, if
the Company Merger is completed as expected, the Company's construction program
for 1997 and future years will be incorporated into Wisconsin Energy Company's
overall construction program.
RATIO OF EARNINGS TO FIXED CHARGES
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
--------------------------------------------------
1995 1994 1993 1992
TWELVE MONTHS ----- ----- ----- -----
ENDED
SEPTEMBER 30,
1996
-----------------
(UNAUDITED)
<S> <C> <C> <C> <C> <C>
Ratio of Earnings to Fixed Charges...................... 4.3 4.2 4.2 4.3 4.3
Wisconsin Energy Company Pro Forma Ratio of Earnings to
Fixed Charges.......................................... 4.3 4.3 3.6 3.7 3.8
<CAPTION>
1991
-----
<S> <C> <C>
Ratio of Earnings to Fixed Charges...................... 4.4
Wisconsin Energy Company Pro Forma Ratio of Earnings to
Fixed Charges.......................................... 4.2
</TABLE>
For purposes of computing the ratio of earnings to fixed charges, (i)
earnings consist of income from continuing operations before accounting change
plus fixed charges, federal and state income taxes, deferred income taxes and
investment tax credits; and (ii) fixed charges consist of interest on long-term
debt, other interest charges, the interest component on leases and amortization
of debt discount, premium and expense.
The Wisconsin Energy Company unaudited pro forma ratios of earnings to fixed
charges for each of the years in the five-year period ended December 31, 1995,
and for the twelve months ended September 30, 1996, give effect to the Company
Merger as if it had occurred at January 1, 1991. See
4
<PAGE>
the Notes to Unaudited Pro Forma Combined Condensed Financial Statements of
Wisconsin Energy Company in the 1995 Form 10-K for a description of the
assumptions used to prepare the unaudited pro forma ratios of earnings to fixed
charges.
The annual interest requirement on long-term debt of the Company outstanding
at September 30, 1996, was $15,924,539.
DESCRIPTION OF NEW BONDS
Each series of New Bonds is to be an initial issue of a new series of first
mortgage bonds (the "Bonds") issued under the Trust Indenture dated April 1,
1947 (the "1947 Indenture") as supplemented by 12 supplemental trust indentures
(collectively, the "Supplemental Indentures,"), a Supplemental and Restated
Trust Indenture dated March 1, 1991 (the "Restated Indenture") and a new
supplemental trust indenture for such series of New Bonds (the "New Supplemental
Indenture") all from the Company to Firstar Trust Company (formerly known as
First Wisconsin Trust Company), as trustee (the "Trustee"). The 1947 Indenture,
as supplemented by the Supplemental Indentures, the Restated Indenture and the
New Supplemental Indenture herein are referred to collectively as the
"Indenture." Excluding the New Bonds, three series of Bonds in an aggregate
principal amount of $194,635,000 currently are outstanding under the Indenture.
Copies of the 1947 Indenture, the Supplemental Indentures, the Restated
Indenture and the form of the New Supplemental Indenture are filed as Exhibits
4.01A to 4.01O to the Registration Statement and the statements herein made
(being for the most part succinct summaries of certain provisions of the
Indenture) are subject to the detailed provisions of the 1947 Indenture, the
Supplemental Indentures, the Restated Indenture and the New Supplemental
Indenture which are incorporated herein by this reference.
The Restated Indenture amends and restates the 1947 Indenture and the
Supplemental Indentures. The Restated Indenture became effective and operative
on October 1, 1993.
References are made to specific Article and Section numbers of the Restated
Indenture and the New Supplemental Indenture. Unless the context indicates
otherwise, words or phrases defined in the Restated Indenture or the New
Supplemental Indenture are capitalized and used with the same meanings herein.
TERMS OF NEW BONDS
The New Bonds will be issued as fully registered bonds without coupons in
denominations of multiples of $1,000. New Bonds may be issued in temporary form
if, for any reason, the Company is unable to deliver New Bonds in definitive
form. Principal and interest are to be payable in Milwaukee, Wisconsin, at
Firstar Trust Company. New Bonds will be interchangeable in the manner provided
in Article II of the New Supplemental Indenture. The New Bonds may be issued in
book-entry form through the facilities of a depository. The description of any
book-entry arrangements will be contained in the Prospectus Supplement.
No charge will be made by the Company for any exchange or transfer of New
Bonds, other than for any taxes or other governmental charges.
Reference is made to the Prospectus Supplement that will accompany this
Prospectus for the following terms and other information with respect to the
Offered Bonds: (1) the designation and aggregate principal amount of such
Offered Bonds; (2) the date or dates on which such Offered Bonds will mature;
(3) the rate or rates per annum (or method of calculation) at which such Offered
Bonds will bear interest and the date from which such interest shall accrue; (4)
the dates on which such interest will be payable; (5) the record dates for
payments of interest; and (6) any optional or mandatory redemption terms or
other specific terms applicable to the Offered Bonds. The holders of the
outstanding Bonds do not, and the holders of the New Bonds will not, have the
right to tender such Bonds to the Company for repurchase upon the Company
becoming involved in a highly leveraged or change in control transaction. The
Indenture does not have any provision that is designed specifically in response
to highly leveraged or change in control transactions. However, bondholders
would have
5
<PAGE>
the security afforded by the first mortgage lien on substantially all the
Company's property as described under the subcaption "Security for New Bonds"
below. In addition, any change in control transaction and any incurrence of
additional indebtedness (as first mortgage bonds or otherwise) by the Company in
such a transaction would require approval of state utility regulatory
authorities and, possibly, of federal utility regulatory authorities. Management
believes that such approvals would be unlikely in any transaction that would
result in the Company, or a successor to the Company, including Wisconsin Energy
Company, having a highly leveraged capital structure. See "PROPOSED MERGER."
SECURITY FOR NEW BONDS
In the opinion of counsel for the Company, the New Bonds when issued will be
secured by the Indenture, which constitutes a first mortgage lien, subject only
to Permitted Encumbrances, upon all real and fixed properties now owned by the
Company (except as otherwise stated in this paragraph) for the equal pro rata
security of all Bonds issued or to be issued under the Indenture, subject to the
provisions relating to any sinking fund or similar fund for the benefit of Bonds
of any particular series. There are excepted from the Lien of the Indenture
securities, cash, contracts, receivables, motor vehicles, merchandise, equipment
and supplies, and certain non-utility real property. (Granting Clauses of the
Restated Indenture.) The Indenture contains provisions for subjecting to the
lien thereof (subject to the limitations in Article XVI in the case of
consolidation or merger) all property acquired by the Company after the date of
the 1947 Indenture other than property of the kind mentioned in the preceding
sentence. Such provisions might not be effective as to property acquired within
90 days prior and subsequent to the filing of a case with respect to the Company
under the United States Bankruptcy Code. The opinion of counsel does not cover
titles to easements for flowage rights not presently exercised or titles to
rights-of-way for transmission and distribution facilities, as counsel for the
Company believes that the expense of examination would exceed the cost of
acquiring, by condemnation or purchase, any easements or rights-of-way held
under defective title. The Company has the power of eminent domain in the states
in which it operates.
Permitted Encumbrances include (a) rights of Persons who are parties to
agreements with the Company relating to property owned or used jointly (in
common) by the Company with such Persons, provided (i) that such rights do not
materially impair the use of such jointly owned or used property in the normal
operation of the Company's business and do not materially affect the security
afforded by the Indenture and (ii) that such rights are not inconsistent with
the remedies of the Trustee upon a Completed Default; (b)(i) leases existing at
the Effective Date of the Restated Indenture affecting property owned by the
Company on the Effective Date; (ii) leases which do not interfere in any
material respect with the use of the related property for the purpose for which
it is held by the Company and which will not have material adverse impact on the
security afforded by the Indenture or (iii) other leases relating to not more
than 5% of the sum of the Company's Depreciable Property and Land; and (c) any
mortgage, lien, charge or encumbrance prior or equal to the Lien of the
Indenture, other than a Prepaid Lien, existing at the date any property is
acquired by the Company, provided that at the date of acquisition of such
property: (i) no Default has occurred and is continuing; (ii) the principal
amount of indebtedness outstanding under and secured by such mortgage, lien,
charge or encumbrance shall not exceed 66 2/3% of the lesser of the Cost or Fair
Value of the property so acquired; and (iii) each such mortgage, lien, charge or
encumbrance shall apply only to the property and improvements originally subject
thereto and that the Company shall cause to be closed all mortgages or other
liens existing at the time of acquisition of any property thereafter acquired by
the Company and will permit no additional indebtedness to be issued thereunder
or secured thereby. (Section 1.03 of the Restated Indenture.)
The holders of 66 2/3% of the principal amount of Bonds Outstanding may (a)
consent to the creation or existence of a Prior Lien with respect to up to 50%
of the sum of the Company's Depreciable Property and Land, after giving effect
to such Prior Lien or (b) terminate the Lien of the Indenture with respect to up
to 50% of the sum of the Company's Depreciable Property and Land. (Section
19.02(e) of the Restated Indenture.)
6
<PAGE>
The Indenture is not a lien on the properties of the Minnesota Company. The
Lien of the Indenture will continue to apply only to property and franchises
owned by the Company prior to the Company Merger, and to any additions,
extensions and repairs to such properties acquired or made after the Company
Merger, and will not apply to any property owned by WEPCO prior to the Company
Merger. It is expected that following the Company Merger, Wisconsin Energy
Company's outstanding indebtedness will include first mortgage bonds that were
previously issued by the Company, WEPCO, Wisconsin Natural Gas Company and
Wisconsin Southern Gas Company under separate trust indentures. See "PROPOSED
MERGER" and "RATIO OF EARNINGS TO FIXED CHARGES." It is not expected that any
additional Bonds will be issued under the Indenture following the Company
Merger.
SINKING FUND PROVISIONS
The sinking fund redemption provision, if any, for each series of the New
Bonds will be set forth in the Prospectus Supplement. As an annual sinking fund,
the Company covenants to pay to the Trustee annually on April 1 an amount
sufficient to redeem, on the following June 1, for sinking fund purposes 1% of
the highest amount at any time outstanding of Bonds of the Series due April 1,
2021 and the Bonds of the Series due March 1, 2023. Sinking fund payments may be
offset at the option of the Company by (a) retirement or delivery to the Trustee
of Bonds of the series for which the sinking fund is applicable or (b)
application of Amounts of Established Permanent Additions equal to 150% of the
principal amount of Bonds which would otherwise be required to be retired by the
sinking fund. (Sections 5.04(vi), 5.07 and 13.01(c) of the Restated Indenture.)
The Trustee is required to apply sinking fund money to the purchase or
redemption of Bonds of the series for which such funds are applicable. (Article
XIII of the Restated Indenture.)
MAINTENANCE PROVISIONS
As a Maintenance Fund for the Bonds, the Company covenants to pay to the
Trustee annually on May 1 an amount equal to 2.50% of its Completed Depreciable
Property as of the end of the preceding calendar year, after deducting credits
at the Company's option for (a) maintenance, (b) property retirements offset by
Permanent Additions, (c) retirement of Bonds and (d) Amounts of Established
Permanent Additions. (Section 9.01 of the Restated Indenture.) The Restated
Indenture further provides that to the extent that Maintenance Fund credits
exceed 2.50% of Completed Depreciable Property for any year after 1990, such
excess credits may be applied in future years (a) to offset any Maintenance Fund
deficiency or (b) to increase the Amount of Established Permanent Additions
available for use under the Indenture. (Section 9.05 of the Restated Indenture.)
The Company has covenanted to maintain its properties in adequate repair,
working order and condition. (Section 8.06 of the Restated Indenture.)
ISSUANCE OF ADDITIONAL BONDS
The maximum principal amount of Bonds that may be issued under the Indenture
is not limited except as described below. Additional Bonds may be issued on the
basis of (a) 66 2/3% of the Cost or Fair Value, whichever is less, of Permanent
Additions, after making the required deductions on account of Retired Property
(Article V of the Restated Indenture); (b) retired Bonds that have not been
otherwise used under the Indenture (Article VI of the Restated Indenture); and
(c) deposit of an equal amount of cash with the Trustee, which cash may be
withdrawn on the same basis as additional Bonds may be issued under clauses (a)
and (b) above. (Article VII of the Restated Indenture.)
The New Bonds will be issued under clauses (a) and/or (b) above. At
September 30, 1996 the amount of net Permanent Additions available for the
issuance of Bonds exceeded $102 million, of which $97.6 million could be used
for the authentication of $65 million principal amount of the New Bonds. As of
September 30, 1996, $81 million of retired Bonds were available for the
authentication of up to $81 million of New Bonds.
No additional Bonds may be issued on the basis of clause (a), clause (b)
under specified conditions, or clause (c) unless the Earnings Applicable to Bond
Interest for a specified twelve month period are equal to twice the annual
interest requirements on the Bonds including those about to be issued, and
7
<PAGE>
any obligations secured by Prior Liens and any indebtedness secured by Permitted
Encumbrances. The calculation of Earnings Applicable to Bond Interest includes
all non-utility revenues of the Company. (Sections 1.03, 5.03, 6.02 and 7.01 of
the Restated Indenture.)
Permanent Additions include: the Company's electric and steam generating,
transmission and distribution properties; the Company's gas storage and
distribution properties; construction work-in-progress; fractional and undivided
property interests of the Company; property used for providing telephone or
other communications services; and engineering, financial, economic,
environmental, geological and legal or other studies, surveys or reports
associated with the acquisition or construction of any Depreciable Property.
(Section 1.03 of the Restated Indenture.)
Earnings Applicable to Bond Interest for the twelve months ended September
30, 1996, would be 3.9 times the annual interest requirements on the Bonds
assuming the issuance of the New Bonds at an assumed interest rate of 7.375%.
Additional Bonds may vary from the Offered Bonds as to maturity, interest rate,
redemption prices, sinking fund and in certain other respects. (Article II of
the Restated Indenture.)
DIVIDENDS ON COMMON STOCK
The Indenture does not restrict the Company's payment of dividends on its
common stock.
RELEASE PROVISIONS
The Indenture contains provisions permitting the release from its lien of
any property upon depositing or pledging cash or certain other property of
comparable Fair Value. The Indenture also contains provisions for the
cancellation, change or alteration of leases, rights-of-way and easements, and
for the surrender and modification of any franchise or governmental consent
subject to certain restrictions, in each case without any release or consent by
the Trustee or accountability thereto for any consideration received by the
Company. (Article XI of the Restated Indenture.)
Under the Indenture, (a) the Company may sell or otherwise dispose of, free
of the Lien of the Indenture, all vessels and marine equipment, railroad cars,
engines and related equipment, airplanes, office furniture and leasehold
interests in property owned by third parties and (b) the Company may enter into
leases with respect to the property subject to the Lien of the Indenture which
do not interfere in any material respect with the use of such property for the
purpose for which it is held by the Company and will not have a material adverse
impact on the security afforded by the Indenture. (Section 11.02(b) of the
Restated Indenture.)
Any of the mortgaged and pledged property may be released from the Lien of
the Indenture without depositing the proceeds from the sale of such property
with the Trustee, if after such release, the Fair Value of the remaining
mortgaged and pledged property of the character of Permanent Additions equals or
exceeds a sum equal to 150% of the aggregate principal amount of Bonds
Outstanding. (Section 11.03(k) of the Restated Indenture.) Upon satisfaction of
the requirements set forth in the Indenture, this provision would permit the
Company to spin-off or otherwise dispose of a substantial amount of assets or a
line of business, including all or a portion of the Company's electric
generation, transmission or distribution assets, or its gas storage and
distribution assets, without depositing cash or property with the Trustee or
obtaining the consent of the bondholders.
REDEMPTION GENERALLY
Moneys on deposit in the Maintenance Fund and the Release Fund under the
Indenture may be used for the purchase or redemption of Bonds, provided that the
Company does not have the power to use any such moneys to redeem any Bond that
is not otherwise redeemable or to redeem any Bond at a price less than the price
at which such Bond could be redeemed pursuant to its terms.
MODIFICATION OF THE INDENTURE
With the consent of the Company, the provisions of the Indenture may be
changed by the affirmative vote of the holders of 66 2/3% in principal amount of
the Bonds Outstanding except that,
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<PAGE>
among other things, the maturity of a Bond may not be extended, the interest
rate reduced, nor the terms of payment of principal or interest changed without
the consent of the holder of each Bond so affected. (Article XIX of the Restated
Indenture.)
CONCERNING THE TRUSTEE
In case of a Completed Default the Trustee may, and upon written request of
the holders of a majority in principal amount of the Bonds then Outstanding
shall, declare the principal of all Bonds then Outstanding and the interest
accrued thereon to be due and payable immediately, and the same shall become due
and payable subject to the right of the holders of the majority in principal
amount of the Bonds then Outstanding upon certain conditions to rescind and
annul such declaration. The Indenture provides in substance that no holder of
any Bond shall have any right to institute any suit, action or proceeding in
equity or at law for the foreclosure of the Indenture or for the appointment of
a receiver or for any other remedy thereunder unless such holder shall have
previously given to the Trustee written notice of default, nor unless also the
holders of 25% in principal amount of the Bonds then Outstanding shall have made
written request to the Trustee to exercise the powers granted by the Indenture
but the right of action of holders of Bonds to enforce payment of the principal
or interest shall not be impaired. As a condition precedent to certain actions
by the Trustee in the enforcement of the Lien of the Indenture and institution
of action on the Bonds, the Trustee may require adequate indemnity against
costs, expenses and liabilities to be incurred thereby. (Article XIV of the
Restated Indenture.)
The Company utilizes some of the commercial banking services offered by an
affiliate of the Trustee.
DEFAULTS
The following is a summary of events defined in the Indenture as Completed
Defaults: (a) default in the payment of principal of or premium, if any, on any
Bond when due and payable, (b) default continued for 30 days in the payment of
interest on any Bond; (c) default continued for 60 days in any sinking fund
payment; (d) default in the covenants of the Company with respect to bankruptcy,
insolvency, assignment or receivership, or (e) default continued for 60 days
after notice to the Company from the Trustee in the performance of any other
covenant, agreement or condition contained in the Indenture. (Section 14.01 of
the Restated Indenture.)
The Trustee is required to give notice to bondholders (1) within 90 days
after the occurrence of a Default known to the Trustee within such period, or
(2) if the Trustee is unaware of a Default during such period, promptly after
the Trustee knows of such Default, unless such Default shall have been cured
before the giving of such notice; provided that, except in the case of a Default
resulting from the failure to make any payment of principal of, or interest on,
any Bonds or to make any sinking fund payment, the Trustee may withhold such
notice upon determination in good faith by the board of directors, the executive
committee or a trust committee of directors and/or responsible officers of the
Trustee that the withholding of such notice is in the interest of the
bondholders. (Article XVII of the Restated Indenture.)
If the Trustee recovers any moneys following a Completed Default, all such
moneys shall be applied in the following order: (i) to the payment of taxes,
assessments or Prior Liens and all costs and expenses, including the payment of
the fees, expenses, liabilities and advances incurred or made by the Trustee,
(ii) to the payment in full of the amounts then due and unpaid for principal and
interest upon the Bonds then Outstanding, and in the case such proceeds shall be
insufficient to pay in full the amounts so due and unpaid, then to the payment
thereof ratably, with interest on overdue principal and interest, and (iii) to
the Company, its successors or assigns. (Section 14.11 of the Restated
Indenture.)
The Company is required to file with the Trustee such information, documents
and reports with respect to compliance by the Company with the conditions and
covenants of the Indenture as may be
9
<PAGE>
required by the rules and regulations of the Commission including a certificate,
furnished not less frequently than annually, as to the Company's compliance with
all of the conditions and covenants under the Indenture. (Section 8.18 of the
Restated Indenture.)
GENERAL
Whenever all indebtedness secured by the Indenture shall have been paid, or
adequate provision therefor made, the Trustee shall, upon request of the
Company, cancel and discharge the Lien of the Indenture. (Article XVIII of the
Restated Indenture.) The Company may deposit with the Trustee any combination
of cash or Governmental Obligations in order to provide for the payment of any
series or all of the Bonds Outstanding. Such a deposit could constitute a
taxable event as to the holders of such bonds, creating possible adverse tax
consequences. The Indenture also provides that the Company shall furnish to the
Trustee Officers' Certificates, certificates of an Engineer, Appraiser or other
expert and, in certain cases, Accountants' Certificates in connection with the
authentication of Bonds, the release or release and substitution of property and
certain other matters, and Opinions of Counsel as to the Lien of the Indenture
and certain other matters. (Articles IV, V, VI, VII, XI and XVIII and Section
21.08 of the Restated Indenture.)
LEGAL OPINIONS
Legal opinions relating to the New Bonds will be rendered by John P. Moore,
Jr., 100 North Barstow Street, Eau Claire, Wisconsin, General Counsel for the
Company, by Loomis, Ewert, Parsley, Davis & Gotting, 1200 Manufacturer's Bank of
Lansing Building, Lansing, Michigan, special Michigan counsel for the Company,
and by Gardner, Carton & Douglas, 321 North Clark Street, Chicago, Illinois,
counsel for any underwriters, dealers or agents named in a Prospectus
Supplement. Matters pertaining to local laws will be passed upon by counsel for
the Company and as to these matters Gardner, Carton & Douglas will rely on those
opinions. The opinions contained in this Prospectus under the caption
"Description of New Bonds -- Security for New Bonds", are the opinions of John
P. Moore, Jr., who is General Counsel and Secretary of the Company. Gardner,
Carton & Douglas from time to time acts as special counsel to the Company and
the Minnesota Company in connection with certain matters, including the
Transaction.
EXPERTS
The historical financial statements of the Company for the year ended
December 31, 1995; the consolidated historical financial statements of the
Minnesota Company for the year ended December 31, 1995; the consolidated
historical financial statements of WEC; and the historical financial statements
of WEPCO incorporated in this Prospectus by reference to the Company's Annual
Report on Form 10-K, for the year ended December 31, 1995, have been so
incorporated in reliance upon the reports of Price Waterhouse LLP given on the
authority of said firm as experts in auditing and accounting.
The financial statements and the related financial statement schedules of
the Company and the Minnesota Company for the years ended December 31, 1994 and
1993, incorporated in this Prospectus by reference to the Company's Annual
Report on Form 10-K, for the year ended December 31, 1995, have been so
incorporated in reliance upon the reports of Deloitte & Touche LLP (which report
on the Minnesota Company expresses an unqualified opinion and includes an
explanatory paragraph related to the Minnesota Company's change in method of
accounting for postretirement healthcare costs in 1993) given upon the authority
of that firm as experts in accounting and auditing.
PLAN OF DISTRIBUTION
The Company may sell the New Bonds (i) to or through underwriters or
dealers; (ii) directly to one or more purchasers; or (iii) through agents. The
Prospectus Supplement with respect to each series of Offered Bonds will set
forth the terms of the offering of such Offered Bonds, including the name or
names of any underwriters, the purchase price of such Offered Bonds and the
proceeds to the
10
<PAGE>
Company from such sale, any underwriting discounts and other items constituting
underwriters' compensation, any initial public offering price, any discounts or
concessions allowed or reallowed or paid to dealers and any securities exchanges
on which such Offered Bonds may be listed. Any initial offering price and any
discounts, concessions or commissions allowed or reallowed or paid to dealers
may be changed from time to time.
If underwriters are used in the sale, the Offered Bonds will be acquired by
the underwriters for their own account and may be resold from time to time in
one or more transactions, including negotiated transactions, at a fixed public
offering price or at varying prices determined at the time of sale. The Offered
Bonds may be offered to the public either through underwriting syndicates
represented by one or more managing underwriters or directly by one or more of
such firms. The specific managing underwriter or underwriters, if any, will be
set forth in the Prospectus Supplement relating to the Offered Bonds together
with the members of the underwriting syndicate, if any. Unless otherwise set
forth in the Prospectus Supplement, the obligations of the underwriters to
purchase the Offered Bonds offered thereby will be subject to certain conditions
precedent and the underwriters will be obligated to purchase all such Offered
Bonds if any are purchased.
Offered Bonds may be sold directly by the Company or through agents
designated by the Company from time to time. The Prospectus Supplement will set
forth the name of any agent involved in the offer or sale of the Offered Bonds
in respect of which the Prospectus Supplement is delivered and any commissions
payable by the Company to such agent.
Any underwriters, dealers or agents participating in the distribution of the
Offered Bonds may be deemed to be underwriters and any discounts or commissions
received by them on the sale or resale of the Offered Bonds may be deemed to be
underwriting discounts and commissions under the Securities Act of 1933. Agents
and underwriters may be entitled, under agreements entered into with the
Company, to indemnification by the Company against certain civil liabilities,
including liabilities under the Securities Act of 1933, or to contributions with
respect to payments which the agents or underwriters may be required to make in
respect thereof. Agents and underwriters may engage in transactions with or
perform services for the Company in the ordinary course of business.
11
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NO PERSON IS AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS SUPPLEMENT OR THE
ACCOMPANYING PROSPECTUS, AND, IF GIVEN OR MADE, SUCH INFORMATION OR
REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED. THIS
PROSPECTUS SUPPLEMENT AND THE ACCOMPANYING PROSPECTUS DO NOT CONSTITUTE AN OFFER
TO SELL OR A SOLICITATION OF AN OFFER TO BUY ANY SECURITIES OTHER THAN THE
SECURITIES OFFERED BY THIS PROSPECTUS SUPPLEMENT AND THE ACCOMPANYING PROSPECTUS
OR AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY SUCH SECURITIES IN ANY
JURISDICTION TO ANY PERSON TO WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER OR
SOLICITATION IN SUCH JURISDICTION. NEITHER THE DELIVER OF THIS PROSPECTUS
SUPPLEMENT AND THE ACCOMPANYING PROSPECTUS NOR ANY SALE MADE THEREUNDER SHALL,
UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THERE HAS BEEN NO CHANGE IN
THE AFFAIRS OF NORTHERN STATES POWER COMPANY SINCE THE DATE OF THIS PROSPECTUS
SUPPLEMENT OR THE ACCOMPANYING PROSPECTUS, OR THAT THE INFORMATION HEREIN OR
THEREIN IS CORRECT AS OF ANY TIME SINCE SUCH DATE.
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TABLE OF CONTENTS
PROSPECTUS SUPPLEMENT
<TABLE>
<CAPTION>
PAGE
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<S> <C>
Use of Proceeds........................................................... S-2
Supplemental Description of Offered Bonds................................. S-2
Underwriting.............................................................. S-5
PROSPECTUS
Available Information..................................................... 2
Documents Incorporated by Reference....................................... 2
NSP....................................................................... 3
Proposed Merger........................................................... 3
Use of Proceeds........................................................... 4
Construction Program and Financing........................................ 4
Ratio of Earnings to Fixed Charges........................................ 4
Description of New Bonds.................................................. 5
Legal Opinions............................................................ 10
Experts................................................................... 10
Plan of Distribution...................................................... 10
</TABLE>
NORTHERN STATES
POWER COMPANY
(A WISCONSIN CORPORATION)
$65,000,000
FIRST MORTGAGE BONDS
DUE DECEMBER 1, 2026, 7 3/8%
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PROSPECTUS SUPPLEMENT
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BEAR, STEARNS & CO. INC.
DECEMBER 12, 1996
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