Filed Pursuant to Rule 424(b)(3)
Registration Statement No. 333-178133
Subject to Completion, Dated August 6, 2014
Preliminary Pricing Supplement to Prospectus Supplement Dated August 6, 2014
and Prospectus Dated November 23, 2011
Pricing Supplement dated August , 2014
(To Prospectus Supplement dated August 6, 2014
and Prospectus dated November 23, 2011)
% Secured Medium-Term Notes, Series J, due August 15, 2019
PUBLIC SERVICE ELECTRIC AND GAS COMPANY (PSE&G)
CUSIP: Trade Date: August , 2014 Original Issue Date/Settlement Date: August , 2014, which is the fourth business day following the Trade Date. Accordingly, purchasers who wish to trade the Notes on the date hereof will be required, because the Notes will not initially settle in T+3, to specify an alternative settlement date at the time of such trade to prevent a failed settlement and should consult their own advisors. Principal Amount: $ ,000,000 Price to Public: % of Principal Amount, plus accrued interest from August , 2014 if settlement occurs after that date Purchase Price: % of Principal Amount Net Proceeds to Company: $ Interest Rate: % per annum Initial Interest Accrual Date: August , 2014 Interest Payment Dates: February 15 and August 15, commencing February 15, 2015 Regular Record Dates: February 1 and August 1 Maturity Date: August 15, 2019 These Notes are DTC Eligible and will be issued in book-entry form | Mode of Distribution: [X] Underwritten [ ] Agented [ ] Barclays Capital Inc. [ ] BNP Paribas Securities Corp. [ ] BNY Mellon Capital Markets, LLC [ ] CIBC World Markets Corp. [X] Credit Suisse Securities (USA) LLC [ ] Goldman, Sachs & Co. [ ] J.P. Morgan Securities LLC [ ] Mitsubishi UFJ Securities (USA), Inc. [X] Mizuho Securities USA Inc. [ ] Morgan Stanley & Co. LLC [X] RBC Capital Markets, LLC [X] RBS Securities Inc. [X] Scotia Capital (USA) Inc. [X] Wells Fargo Securities, LLC [X] Citigroup Global Markets Inc. [X] The Williams Capital Group, L.P.
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Redemption Provisions:
The Secured Medium-Term Notes, Series J offered hereby (the “Secured Medium-Term Notes”) will be subject to redemption as described in the prospectus and prospectus supplement.
Additionally, the Secured Medium-Term Notes will be subject to redemption at any time prior to July 15, 2019 (the date that is one month prior to the Maturity Date) (the “Make Whole Redemption Period”) on not less than 30 days’ prior written notice to holders, either as a whole or in part, at the option of PSE&G, at a redemption price equal to the greater of (i) 100% of the principal amount of the Secured Medium-Term Notes to be redeemed and (ii) the sum of the present values of the remaining scheduled payments of principal and interest thereon (exclusive of accrued interest to the redemption date) discounted to the redemption date on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) at the Treasury Rate plus basis points ( %), plus, in either case, accrued interest thereon to the date of redemption.
At any time on or after July 15, 2019 (the date that is one month prior to the Maturity Date), the Secured Medium-Term Notes will be subject to redemption on not less than 30 days’ prior written notice to holders, either as a whole or in part, at the option of PSE&G, at a redemption price equal to 100% of the principal amount of the Secured Medium-Term Notes to be redeemed, plus accrued interest thereon to the date of redemption.
“Treasury Rate” means, with respect to any redemption date during the Make Whole Redemption Period, the rate per annum equal to the semi-annual 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.
“Comparable Treasury Issue” means the United States Treasury security selected by an Independent Investment Banker as having a maturity comparable to the remaining term of the Secured Medium-Term Notes to be redeemed 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 Secured Medium-Term Notes to be redeemed.
“Comparable Treasury Price” means, with respect to any redemption date during the Make Whole Redemption Period, (i) the average of three Reference Treasury Dealer Quotations for such redemption date, after excluding the highest and lowest of five Reference Treasury Dealer Quotations, or (ii) if the Trustee is unable to obtain five Reference Treasury Dealer Quotations, the average of all Reference Treasury Dealer Quotations so obtained.
“Independent Investment Banker” means one of the Reference Treasury Dealers appointed by PSE&G and acceptable to the Trustee.
“Reference Treasury Dealer” means a primary U.S. Government Securities Dealer in the United States (a “Primary Treasury Dealer”) selected by PSE&G and acceptable to the Trustee.
“Reference Treasury Dealer Quotations” means, with respect to each Reference Treasury Dealer and any redemption date during the Make Whole Redemption Period, 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 or before 5:00 p.m., New York City time, on the third business day preceding such redemption date.
Use of Proceeds:
The net proceeds from the sale of the Secured Medium-Term Notes will be added to the general funds of PSE&G and will be used for general corporate purposes, including, together with the net proceeds from the sale of PSE&G’s $ % Secured Medium-Term Notes, Series J, due August 15, 2024 and other available general funds, the redemption at maturity of PSE&G’s $250,000,000 5.00% Secured Medium-Term Notes, Series D, due August 15, 2014 and $250,000,000 0.85% Secured Medium-Term Notes, Series G, due August 15, 2014.
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