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TABLE OF CONTENTS

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Approximate date of commencement of proposed sale to the public:
As soon as practicable after the effective date of this Registration Statement.

          If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act of 1933, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.     o

          If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act of 1933, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.     o

          If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act of 1933, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.     o

(1)

Estimated pursuant to Rule 457(o) solely for the purpose of calculating the registration fee.

           The Registrants hereby amend this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrants shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, or until this Registration Statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine.

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The information in this prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell nor does it seek an offer to buy these securities in any jurisdiction where the offer or sale is not permitted.

*

Principal amounts are approximate and subject to change

           The total price to the public is $        . The total amount of the underwriting discounts and commissions is $        . The total amount of proceeds to PSNH Funding LLC 3 before deduction of expenses (estimated to be $        ) is $        . The distribution frequency is        . The first expected distribution date is         .

           Public Service Company of New Hampshire, as Depositor , is offering $            aggregate principal amount of the Rate Reduction Bonds, Series 2018-1 listed above (each bond designation a Tranche and the Tranches, collectively, the Rate Reduction Bonds , or the RRBs ), to be issued by PSNH Funding LLC 3, referred to herein as the Issuer , as issuing entity .

           The RRBs are senior secured obligations of the Issuer. The RRBs are supported by the RRB Property , which constitutes a current and irrevocable vested property right of the Issuer under the Finance Order (as defined below), including, without limitation, all right, title and interest of the Issuer in and to all revenues, collections, claims, payments, money or proceeds of or arising from the RRB Charges (as defined below) and to all rights to obtain adjustments to the RRB Charges pursuant to the terms of the Finance Order. The RRB Charges , which are charges authorized pursuant to the Finance Order that will be billed to Customers to recover the RRB Costs, will be used to pay principal, interest and all other amounts payable in connection with the RRBs. Upon the issuance of the RRBs, the RRB Charges may not be revalued or revised by the New Hampshire Public Utilities Commission, or the NHPUC , except as adjusted pursuant to the Periodic Adjustments described herein. The RRB Charges shall be non-bypassable and will be assessed against and collected from all retail Customers taking retail electric service from Public Service Company of New Hampshire, or PSNH , or its successors or assignees under rate schedules approved by the NHPUC. RRB Charges are payable by Customers regardless of who they have chosen as their energy supplier and regardless of whether or not they are self-generating, so long as they are connected to PSNH's distribution system for back-up power. The RRB Property includes the right to mandatory Periodic Adjustments to ensure that the aggregate RRB Charges billed for an applicable period will result in RRB Charge Collections that are sufficient to pay principal and interest on the RRBs and all other required amounts and charges payable in connection with the RRBs. With respect to the foregoing, interest is due on each Payment Date and principal is due upon the Final Maturity Date for each Tranche.

           The RRBs do not constitute a debt, liability or other obligation of, or interest in, PSNH or any of its other affiliates (other than the Issuer). The RRBs will not be insured or guaranteed by PSNH, including in its capacity as Sponsor, Depositor, Seller or Servicer, or by its parent, Eversource Energy, any of their respective affiliates, The Bank of New York Mellon, as the Indenture Trustee , or any other person or entity. The RRBs will be nonrecourse obligations, secured only by the RRB Collateral. The RRBs are not a debt or liability of the State of New Hampshire or any of its political subdivisions, including the NHPUC, and shall not constitute a pledge of the full faith and credit of the State of New Hampshire or its political subdivisions, except, insofar as the State of New Hampshire or any such political subdivision, agency or instrumentality is receiving retail electric service from PSNH or its successor or assignee, such governmental entity will be obligated, in its capacity as a Customer, to pay RRB Charges.

           The RRBs will be issued pursuant to NH Rev. Stat. Chapter 369-B, or the Financing Act , and an irrevocable Finance Order issued by the NHPUC on January 30, 2018 approving the issuance of the RRBs. Under the irrevocable Finance Order, the NHPUC has pledged that it will act, as directed by the Financing Act, to implement the Periodic Adjustments for making any adjustments to the RRB Charges to ensure that the aggregate RRB Charges billed for an applicable period will result in RRB Charge Collections that are sufficient to pay principal of and interest on the RRBs and all other required amounts and charges payable in connection with the RRBs. The NHPUC's obligations under the Financing Act and the Finance Order are irrevocable and the NHPUC shall not have authority, except pursuant to the Periodic Adjustments, to revalue or revise for ratemaking purposes the RRB Costs or the RRB Charge, to determine that the RRB Charge is unjust or unreasonable or in any way to reduce or impair the value of the RRB Property by taking the RRB Charge.

           The RRBs will accrue interest from the date of issuance. The RRBs are scheduled to pay principal and interest semi-annually and sequentially as described herein. The Issuer will pay principal and interest on the RRBs on February 1 and August 1 of each year, beginning on February 1, 2019.

           The RRBs will be payable only from revenues received by the Issuer under the Indenture for the RRBs and funds on deposit in trust accounts relating to the RRBs. These amounts, together with the RRB Property, including the Periodic Adjustments, are the source of funds for the payment of principal of and interest on the RRBs. A Capital Subaccount will hold the Depositor's capital contribution to the Issuer. An Excess Funds Subaccount will hold revenues that are collected but not needed to meet current obligations associated with the RRBs. Credit enhancement for the RRBs will be primarily provided by the Periodic Adjustments, as well as the Capital Subaccount and the ability to collect the RRB Charges beyond the Scheduled Final Payment Date until the Final Maturity Date. The primary purpose of the Excess Funds Subaccount is not to provide credit enhancement for the RRBs. However, amounts in the Excess Funds Subaccount may be used to make debt service payments on the RRBs if needed.

           PSNH is the Depositor, Sponsor, Seller and initial Servicer for the RRBs. PSNH is the sole member and owner of the Issuer's equity interest. PSNH's Central Index Key number is 0000315256. The Issuer's Central Index Key number is 0001730300.

            Investing in the RRBs involves risks. See " Risk Factors " beginning on page 11 to read about factors you should consider before buying the RRBs.

            NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

           The RRBs will be ready for delivery in book-entry form through the facilities of The Depository Trust Company against payment in New York, New York on or about        , 2018.

GOLDMAN SACHS & CO. LLC

The date of this prospectus is            , 2018

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ABOUT THIS PROSPECTUS

        This prospectus is part of a registration statement filed with the Securities and Exchange Commission, or SEC . This prospectus provides you with a description of the RRBs being offered. You should carefully review this prospectus, any free writing prospectus the Issuer files with the SEC, and the information, if any, contained in the documents referenced in this prospectus under the heading "Where You Can Find More Information."

        References in this prospectus to the Issuer mean PSNH Funding LLC 3, the issuing entity. References to PSNH , the Depositor or the Sponsor refer to Public Service Company of New Hampshire or to any successor thereto. References to the Servicer are to PSNH, and any successor servicer under the Servicing Agreement described in this prospectus. References to the Seller mean PSNH or any successor under the Sale Agreement described in this prospectus. References to the Administrator mean PSNH, or any successor or assignee under the Administration Agreement described in this prospectus. References to the NHPUC are to the New Hampshire Public Utilities Commission. References to the Financing Act are to Chapter 369-B, New Hampshire Revised Statutes. Unless the context otherwise requires, the term Customer means any person or entity purchasing directly or otherwise obtaining or being supplied directly with retail electric service by PSNH for end use consumption, including those served under special contracts. References to a Finance Order , unless the context indicates otherwise, are to the irrevocable Finance Order issued by the NHPUC on January 30, 2018. You can find a glossary of some of the other defined terms used in this prospectus on page 108 of this prospectus.

        This prospectus includes cross-references to other sections in this prospectus to allow you to find further related discussions. You can also find key topics in the table of contents on the preceding pages. Check the table of contents to locate these sections.

        You should rely only on the information contained or incorporated by reference in this prospectus and in any related free writing prospectus the Issuer files with the SEC. Neither the Issuer nor any underwriter, any agent, any dealer, any salesperson or PSNH has authorized anyone else to provide you with any different information. If anyone provides you with different or inconsistent information, you should not rely on it. The RRBs are not being offered in any jurisdiction where the offer or sale is not permitted. The information in this prospectus and any free writing prospectus is current only as of the date of this prospectus.

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CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

        This prospectus includes forward-looking statements, including regarding expectations, estimates and projections about the electric consumption of PSNH's Customers, PSNH's ability to service the RRB Property and collect the RRB Charges, the Issuer's ability to pay back the RRBs, and the NHPUC's adherence to the State Pledge to protect the rights of Holders. Any statements that express, or involve discussions as to, expectations, beliefs, plans, objectives, assumptions or future events of performance (often, but not always, through the use of words or phrases such as "will," "are expected to," "will continue," "is anticipated," "believe," "could," "should," "estimated," "may," "plans to," "potential," "projection," "designed to," "intended") are not statements of historical facts and may be forward-looking. Forward-looking statements involve estimates, assumptions and uncertainties. Accordingly, any such statements are qualified in their entirety by reference to important factors included in "Risk Factors" (in addition to any assumptions and other factors referred to specifically in connection with such forward-looking statements) that could have a significant impact on financial results, and could cause actual results to differ materially from those contained in forward-looking statements made by or on behalf of the Issuer or PSNH, in this prospectus, in presentations, on websites, in response to questions or otherwise.

        The following are some factors, among others, that could cause actual results to differ materially from those expressed or implied by forward looking statements in this prospectus:

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state and federal legislative, judicial and regulatory actions or developments, including deregulation and restructuring of the electric utility industry, and changes in, or changes in application of, laws or regulations applicable to other aspects of PSNH's business;



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actions of NRSROs, including downgrading the ratings of the RRBs;



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the accuracy of the Servicer's forecasts of energy consumption resulting from Customer usage patterns, including energy efficiency efforts and use of alternative energy sources, including self-generation;



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changes in market demand, including the effect of Customers ceasing to do business or leaving the service territory;



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the influence of weather and other natural phenomena affecting electric Customer energy usage in the service territory, including the economic, operational and other effects of severe weather, such as ice and snow storms, hurricanes and other natural disasters;



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the accuracy of the Servicer's estimates of the Customer payment patterns, including the rate of delinquencies and charge-offs;



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problems with energy generation, transmission or distribution resulting from a change in the market structure of the electric industry, including with respect to PSNH's transition from reliance on its own power generation to reliance on third-party power generators;



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economic conditions affecting electric Customer energy usage in the service territory;



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direct or indirect results of cyber attacks, security breaches or other attempts to disrupt the Servicer's business; and



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acts of war or terrorism, global instability or other catastrophic events affecting electric Customer energy consumption in the service territory.

        Any forward-looking statement speaks only as of the date on which such statement is made, and the Issuer and PSNH do not undertake any obligation to update any forward-looking statement to reflect events or circumstances, including unanticipated events, after the date on which such statement is made. New factors emerge from time to time and it is not possible for management of the Issuer and PSNH to predict all of such factors, nor can the Issuer and PSNH assess the impact of each such factor on the business of the Issuer and PSNH or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statement.

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RISK FACTORS

         You should consider carefully all the information included in this prospectus, including the following factors, which might negatively impact the Issuer's ability to pay interest on and the principal amount of the RRBs and result in a reduction in the market value of your investment in the RRBs, before you decide whether to invest in the RRBs:

The Issuer might not be able to pay interest and the principal amount of the RRBs, and you might experience payment delays as a result of limited sources of payment for the RRBs and limited credit enhancement.

        You may not receive interest or principal payments or you may suffer material payment delays on your RRBs if the RRB Collateral securing your RRBs is insufficient to pay the accrued interest on and the principal amount of those RRBs in full. The only source of funds for payments of interest on and principal of the RRBs will be the RRB Collateral. The RRB Collateral for the RRBs will be limited to:

•

the RRB Property securing the RRBs, which represents a current and irrevocable vested property right including, without limitation, the right, title and interest of the Issuer in and to all revenues, collections, claims, payments, money or proceeds of or arising from the RRB Charges authorized pursuant to the Finance Order to recover the RRB Costs, and the right to implement the Periodic Adjustments in respect of the RRB Charges;



•

the funds on deposit in the Collection Account, including all subaccounts thereof, held by the Indenture Trustee and the Investment Earnings thereon (other than Capital Subaccount Investment Earnings); and



•

the Issuer's rights under various contracts described in this prospectus.

        The RRBs will not be insured or guaranteed by PSNH, including in its capacity as Sponsor, Depositor, Seller or Servicer, or by its parent, Eversource Energy, any of their respective affiliates, the Indenture Trustee or any other person or entity. The RRBs will be nonrecourse obligations, secured only by the RRB Collateral. The Issuer's failure to pay interest on and the principal amount of the RRBs or delays in payment on the RRBs might result in a reduction in the market value of the RRBs and, therefore, the value of your investment in the RRBs.

        The RRBs do not constitute a debt, liability or other obligation of, or interest in, PSNH or any of its other affiliates (other than the Issuer). The RRBs are not a debt or liability of the State of New Hampshire or any of its political subdivisions, including the NHPUC, and shall not constitute a pledge of the full faith and credit of the State of New Hampshire or any of its political subdivisions.

Risks Associated with Potential Judicial, Legislative or Regulatory Actions

Future legal action might challenge or invalidate the Financing Act or the Finance Order and materially adversely affect your investment.

        The RRB Property is created pursuant to the Financing Act and a Finance Order issued by the NHPUC pursuant to the Financing Act. In June 2000, the New Hampshire General Court enacted 2000 N.H. Laws 249 which, among other things, created a new RSA chapter, RSA Chapter 369-B. RSA Chapter 369-B, the Financing Act, authorized the use of securitization by PSNH to recover certain stranded costs associated with the restructuring of the electric industry in the State of New Hampshire. In July 2015, the Financing Act was amended to provide the NHPUC with the authority to issue the Finance Order authorizing the issuance of RRBs to recover certain stranded costs resulting from the divestiture of some or all of PSNH's generation assets.

        The Financing Act or any provisions thereof might be directly contested in courts or otherwise become the subject of litigation. In addition, the Finance Order or any provision thereof might be

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directly contested in courts or otherwise become the subject of litigation. As of the date of this prospectus, no such litigation has arisen; however, the Issuer cannot assure you that a lawsuit challenging the validity of the Financing Act or the Finance Order will not be filed in the future or that, if filed, such lawsuit will not be successful. If an invalidation of any relevant underlying legislative provision or Finance Order provision were to result from such litigation, you might lose some or all of your investment or you might experience delays in recovering your investment. See "The RRB Property and the Financing Act" and "The Finance Order" in this prospectus.

        New Hampshire and other states have passed legislation similar to the Financing Act to authorize recoveries by utilities of specified costs, such as costs associated with deregulation of the electricity market, environmental control costs or hurricane recovery costs, and some of those laws have been challenged by judicial actions or utility commission Proceedings. To date, none of those challenges has succeeded, but future judicial challenges might be made. An unfavorable decision challenging legislation similar to the Financing Act would not automatically invalidate the Financing Act or the Finance Order, but it might provoke a challenge to the Financing Act or the Finance Order, establish a legal precedent for a successful challenge to the Financing Act or the Finance Order or heighten awareness of the political and other risks of the RRBs, and in that way may limit the liquidity and value of the RRBs. Therefore, legal activity in other states might indirectly affect the value of your investment in the RRBs.

Future New Hampshire legislative action might attempt to invalidate the RRBs or the RRB Property.

        Under the Financing Act, the State of New Hampshire has pledged not to limit, alter, amend, reduce or impair the RRB Charges, the RRB Property, the Finance Order, or any rights thereunder or ownership thereof or security interest therein until the RRBs, including all principal, interest, premium costs and arrearages thereon are fully met and discharged, unless adequate provision is made by law for the protection of the owners, Holders and Indenture Trustees of the RRBs, which is referred to as the State Pledge. For a description of the State Pledge, see "The Financing Act and the Finance Order" in this prospectus. Despite the State Pledge, the New Hampshire legislature might attempt to repeal the Financing Act, or attempt to amend the Financing Act, or as described below, the NHPUC might take certain actions that impair the RRB Property.

        Under U.S. and New Hampshire constitutional principles related to the impairment of contracts, the New Hampshire legislature and the NHPUC would generally be prohibited, without paying just compensation, from passing any subsequent law or exercising any legislative powers, as applicable, that would limit, alter, amend, reduce or impair the value of the RRB Property so as to substantially impair the rights of the owners of the RRB Property or the Holders. There have been numerous cases in which legislative or popular concerns with the burden of taxation or government charges have led to adoption of legislation reducing or eliminating taxes or charges that supported bonds or other contractual obligations entered into by public instrumentalities.

        The Issuer cannot assure you that a repeal or amendment of the Financing Act will not be adopted or sought or that any action or refusal to act by the State of New Hampshire will not occur, any of which may constitute a violation of the State Pledge with the owners of the RRB Property and the Holders. If a violation of this pledge occurred, costly and time-consuming litigation might ensue regardless of the outcome of such litigation. Any litigation might materially adversely affect the price of the RRBs and your ability to resell the RRBs and might delay the timing of payments on the RRBs. Moreover, given the lack of controlling judicial precedent directly addressing the RRBs and the State Pledge, the Issuer cannot predict the outcome of any litigation with certainty, and, accordingly, you could experience a delay in receipt of payments on or incur a loss on your investment in the RRBs.

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        Except as described in "The Sale Agreement—Indemnification" in this prospectus, neither the Issuer, PSNH, nor any of its successors, assignees or affiliates will indemnify you for any change in law, including any amendment or repeal of the Financing Act, that might affect the value of the RRBs.

The NHPUC might attempt to take actions which might reduce the value of your investment.

        The NHPUC will continue to regulate many aspects of the electric industry in New Hampshire and may take actions that adversely affect Holders. For example, the NHPUC will:

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regulate investor-owned electric distribution companies, including PSNH;



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set requirements for electric generation suppliers and other third parties; and



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set customer billing guidelines and collection, metering and disclosure requirements for electric distribution companies, electric generation suppliers and other third parties.

        Actions taken by the NHPUC pursuant to the regular exercise of its regulatory powers as described above could adversely affect the ability of the Servicer to collect the RRB Charges on a full and timely basis or impose financial constraints on the Servicer that could lead it to default on its obligations.

        Additionally, the NHPUC could revise or rescind any of its regulations or take other actions relating to the RRB Charges or the RRB Property. Any such change in regulations or other action would be subject to the State Pledge not to limit, alter, amend, reduce or impair the RRB Charges, the RRB Property, the Finance Order, or any rights thereunder or ownership thereof or security interest therein, without making adequate provision for the interests of the Issuer, the Indenture Trustee and the Holders. See "The Financing Act and the Finance Order" in this prospectus. Any such change in regulations or other action also would be subject to the provision of the Financing Act that prohibits the NHPUC from revaluing or revising stranded costs, determining that the RRB Charges are unjust or unreasonable or in any way reducing or impairing the value of the RRB Property or revenues arising from its collection. See "The Financing Act and the Finance Order" in this prospectus. PSNH cannot predict whether the NHPUC will make new regulations, the timing or content of any new NHPUC Regulations or any other actions relating to the RRB Charges or the RRB Property that the NHPUC might take in the future. Future NHPUC Regulations may affect the ratings of the RRBs or their price. Those actions may also affect the rate of collections of RRB Charges and, as a result, the amortization of RRBs and their weighted average lives. As a result, Holders could suffer a loss of their investment.

        PSNH, as Servicer, is required to file with the NHPUC Routine True-Up Letters and Non-Routine True-Up Letters to adjust the RRB Charges. See "The Servicing Agreement—Periodic Adjustment Process" in this prospectus. These adjustments are intended to provide, among other things, for timely payment on the RRBs. Although the Finance Order approves PSNH's routine Periodic Adjustment methodology and provides that routine RRB Charge adjustments will take effect within a specified period of time after the filing of the applicable Routine True-Up Letter, the NHPUC might challenge an adjustment contained in a Routine True-Up Letter or may refuse to permit a routine adjustment to take effect, on the ground that the adjustment contains an error or for some other reason. The NHPUC also might challenge an adjustment contained in a Non-Routine True-Up Letter or might refuse to permit a non-routine adjustment to take effect, on the ground that the adjustment contains an error or for some other reason. Any such challenge or refusal by the NHPUC could cause a delay in the payments on the RRBs.

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The Servicer may not fulfill its obligations to act on behalf of the Holders to protect Holders from actions by the NHPUC or the State of New Hampshire, or the Servicer may be unsuccessful in any such attempt.

        The Servicer will agree in the Servicing Agreement, on behalf of the Holders, to take any action or Proceeding necessary to compel performance by the NHPUC and the State of New Hampshire of any of their obligations or duties under the Financing Act, the Finance Order or any True-Up Letter, including any actions reasonably necessary to block or overturn any attempts to cause a repeal or modification of the Financing Act or the Finance Order or the rights of Holders of the RRB Property by legislative enactment or constitutional amendment that would be adverse to the Holders. The Servicer, however, may not be able to take those actions for a number of reasons, including due to legal or regulatory restrictions, financial constraints and practical difficulties in successfully challenging any such legislative enactment or constitutional amendment. Additionally, any action the Servicer is able to take may not be successful. Any such failure to perform its obligations or to successfully compel performance by the NHPUC or the State of New Hampshire could negatively impact Holders' rights and result in a loss of their investment.

A municipal entity might assert the right to acquire portions of PSNH's electric distribution facilities and avoid payment of the RRB Charges.

        The Financing Act provides that if a municipal entity assumes responsibility for providing electric service to a portion of an electric utility's service territory—an event commonly referred to as municipalization—the NHPUC will, in matters over which the Federal Energy Regulatory Commission, or FERC , does not have jurisdiction or grants jurisdiction to the State of New Hampshire, determine the consequential damages arising from the assumption and establish a recovery mechanism for these damages. These consequential damages include those resulting from the electric utility's stranded investment. The Financing Act also provides that consequential damages are to be allocated between the RRB Charges and other rates and charges in a just and reasonable manner. If a municipalization occurs with respect to a portion of PSNH's service territory accounting for a significant portion of PSNH's revenues or sales, the NHPUC could underestimate future sales by the new municipal electric entity in determining the amount of PSNH's consequential damages under the Financing Act, which could cause shortfalls in RRB Charge Collections and delays in payments to Holders.

Neither the Issuer nor PSNH is obligated to indemnify you for changes in law.

        Neither the Issuer nor PSNH nor any of their successors, assignees or affiliates will indemnify you for any changes in the law, including any federal preemption or repeal or amendment of the Financing Act that might affect the value of your RRBs. Although PSNH or any successor assignee might be required to indemnify the Issuer if legal action based on the law in effect at the time of the issuance of the RRBs invalidates the RRB Property, such indemnification obligations do not apply for any changes in law after the date the RRBs are issued, whether such changes in law are effected by means of any legislative enactment, any constitutional amendment or any final and non-appealable judicial decision. See "The Sale Agreement—Seller Representations and Warranties" and "The Servicing Agreement—Servicing Standards and Covenants" in this prospectus.

Risks Associated with Servicing

Your investment in the RRBs depends on PSNH or its successors or assignees acting as Servicer of the RRB Property.

        PSNH, as Servicer, will be responsible for, among other things, calculating, billing, collecting and posting the RRB Charges from Customers, submitting requests to the NHPUC to adjust these charges, monitoring the RRB Collateral for the RRBs and taking certain actions in the event of non-payment by a Customer. The Indenture Trustee's receipt of collections in respect of the RRB Charges will

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depend in part on the skill and diligence of the Servicer in performing these functions. The systems that the Servicer has in place for RRB Charge billings, collections and postings, as the same may be modified by any applicable current or future NHPUC Regulations, might, in particular circumstances, cause the Servicer to experience difficulty in performing these functions in a timely and accurate manner. In addition, should the Servicer enter into bankruptcy, to the extent permitted by law or a bankruptcy court, it may stop acting as Servicer, resulting in disruption of collection of RRB Charges. If the Servicer fails to make collections for any reason, then the Servicer's payments to the Indenture Trustee in respect of the RRB Charges might be delayed or reduced. In that event, the Issuer's payments on the RRBs might be delayed or reduced.

Changes to billing, collection and posting practices might reduce the value of your investment in the RRBs.

        The Finance Order specifies the methodology for determining the amount of the RRB Charges the Issuer may impose. However, subject to any required NHPUC approval, the Servicer may set its own billing, collection and posting arrangements with Customers from whom it collects RRB Charges, provided that these arrangements comply with any applicable NHPUC customer safeguards and the provisions of the Servicing Agreement. For example, to recover part of an outstanding bill, the Servicer may agree to compromise amounts due or to extend a Customer's payment schedule, including the RRB Charges, so long as such action is in accordance with the Servicer's existing collection policies and complies in all material respects with applicable law. Also, subject to any required NHPUC approval, the Servicer may change billing, collection and posting practices, which might adversely impact the timing and amount of Customer payments and might reduce RRB Charge Collections, thereby limiting the Issuer's ability to make scheduled payments on the RRBs. Separately, the NHPUC might require changes to these practices. Any changes in billing, collection and posting practices or regulations might make it more difficult for the Servicer to collect the RRB Charges and adversely affect the value of your investment in the RRBs.

If the Issuer needs to replace PSNH as the Servicer, the Issuer may experience difficulties finding and using a replacement Servicer.

        Under certain circumstances, PSNH may resign as Servicer, or the Indenture Trustee or certain Holders may remove PSNH as Servicer. See "The Servicing Agreement—Matters Regarding the Servicer" and "The Servicing Agreement—Rights When Servicer Defaults." If PSNH ceases to service the RRB Property related to the RRBs, it might be difficult to find a successor Servicer. Also, any successor Servicer might have less experience and ability than PSNH and might experience difficulties in collecting RRB Charges and determining appropriate adjustments to the RRB Charges and billing and/or payment arrangements may change, resulting in delays or disruptions of collections. A successor Servicer might only be willing to perform such services for fees higher than those approved in the Finance Order or might charge fees that, although permitted under the Finance Order, are substantially higher than the fees paid to PSNH as Servicer. Although a Periodic Adjustment may be required to allow for the increase in fees, there could be a gap between the incurrence of those fees and the implementation of a Periodic Adjustment to adjust for that increase that might adversely affect distributions to Holders. In addition, in the event of the commencement of a case by or against the Servicer under the Bankruptcy Code or similar laws, the Issuer and the Indenture Trustee might be prevented from effecting a transfer of servicing due to operation of the Bankruptcy Code. Any of these factors might delay the timing of payments and reduce the value of your investment.

It might be difficult for successor Servicers to collect the RRB Charges from PSNH's Customers.

        Any successor Servicer may bring an action against a Customer for non-payment of the RRB Charge, but only a successor Servicer that is a successor electric utility may terminate electric service for failure to pay the RRB Charge. A successor Servicer that does not have the threat of termination

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of electric service available to enforce payment of the RRB Charge would need to rely on the successor electric utility to threaten to terminate service for nonpayment of other portions of monthly electric utility bills. This inability might result in higher delinquencies and reduce the value of your investment. Also, a change in the Servicer would cause payment instructions to change, which could lead to a period of disruption in which Customers withhold payment or continue to remit payment according to the former payment instructions, resulting in delays in collection that could result in delays in payments on the RRBs.

Risk Associated with the Unusual Nature of the RRB Property

A shortfall in RRB Charge Payments as a result of inaccurate forecasting or unanticipated delinquencies could lead to payment delays or losses.

        Because the RRB Charges are assessed based on kilowatt-hours, or kWh, of electricity consumed by Customers, a shortfall of payments arising from the RRB Charges could result if the Servicer inaccurately forecasts electricity consumption or underestimates Customer delinquencies or charge-offs when setting the RRB Charges, both initially and at the time of any Periodic Adjustment of the RRB Charges. See "The Servicing Agreement—Periodic Adjustment Process" in this prospectus. A shortfall could cause payments on the RRBs to be made later than expected or not at all. As a result, payments of principal of the RRBs might not be paid according to the Expected Amortization Schedule, which would lengthen the weighted average life of the RRBs. In addition, a change in energy consumption by Customers might also result in payments of principal of the RRBs not being paid by the Final Maturity Date of the RRBs or not being paid at all. For the same reasons, payments of interest on the RRBs could also be delayed or not made. Although the RRB Charge adjustment process is intended to mitigate these risks over the life of the RRBs, the process may not prevent a temporary delay in payment.

        Inaccurate forecasting of electricity consumption by the Servicer could result from, among other things:

•

warmer winters or cooler summers, resulting in less electricity consumption than forecasted;



•

general economic conditions being worse than expected, causing Customers to migrate from PSNH's or a successor distribution company's service territory or reduce their electricity consumption;



•

the occurrence of a natural disaster, such as a blizzard or hurricane, unexpectedly disrupting electrical service and reducing consumption;



•

problems with energy generation, transmission or distribution resulting from a change in the market structure of the electric industry, including with respect to PSNH's transition from reliance on its own power generation to reliance on third-party power generators;



•

Customers accounting for a significant portion of PSNH's revenues or sales ceasing to do business or leaving PSNH's or a successor distribution company's service territory, which may be more likely because the Financing Act prohibits electric utilities from charging or assessing any exit fees on Customers;



•

Customers consuming less electricity because of increased conservation efforts or technological change; or



•

Customers accounting for a significant portion of PSNH's revenues or sales switching to self-generation or co-generation of electric power, which may be more likely because the Financing Act prohibits electric utilities from charging or assessing any exit fees on Customers.

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        Inaccurate forecasting of delinquencies or charge-offs by the Servicer could result from, among other things:

•

unexpected deterioration of the economy, the occurrence of a natural disaster, an act of war or terrorism or other catastrophic events, causing greater charge-offs than expected or forcing PSNH or a successor distribution company to grant additional payment relief to more Customers;



•

a change in law that makes it more difficult for PSNH or a successor distribution company to disconnect nonpaying Customers, or that requires PSNH or a successor distribution company to apply more lenient credit standards in accepting Customers; or



•

the introduction into the energy markets of less creditworthy third-party energy suppliers that are permitted under the Finance Order to collect and remit payments arising from the RRB Charges to the Servicer on behalf of Customers.

Time limitation on assessment of RRB Charges may lead to insufficient revenues to make payments.

        You may experience payment defaults on the RRBs because under the Finance Order the RRB Charges may only be billed and collected for two years after the Final Maturity Date of the latest maturing Tranche of RRBs. See "The Financing Act and the Finance Order" in this prospectus. If the principal of and interest on the RRBs have not been paid in full by the end of the period during which the RRB Charges may be assessed and collected, Holders may suffer a loss of their investment.

Unique nature of RRB Collateral may impair the Indenture Trustee's ability to realize on RRB Collateral.

        If there is an Event of Default on the RRBs and the Indenture Trustee elects or is directed by the Holders to foreclose on the RRB Property, there is likely to be a limited market, if any, for the RRB Property so the Indenture Trustee is unlikely to be able to resell the RRB Property because of its unique nature. Therefore, foreclosure might not be a realistic or practical remedy. Moreover, although principal of the RRBs will be due and payable upon acceleration of the RRBs after an Event of Default, payment of the RRB Charges by Customers likely would not be accelerated and therefore the principal of the RRBs would only be paid as funds become available. If there is an acceleration of the RRBs, all Tranches of the RRBs will be paid pro rata; therefore, some Tranches might be paid earlier than expected and some Tranches might be paid later than expected.

Risks Associated with External Factors Affecting Collections

Storm damage to PSNH's operations might impair payment of the RRBs.

        Severe weather, such as ice and snow storms, hurricanes and other natural disasters, may cause outages and property damage. The potential disruption of PSNH's operations or the operations of power generation facilities owned by third parties from which PSNH purchases power due to storms, natural disasters or other catastrophic events could be substantial. Generation, transmission, distribution and consumption of electricity might be interrupted temporarily, reducing the collections of RRB Charges. There might be longer-lasting adverse effects on residential and commercial development and economic activity in the PSNH service area, which could cause the per-kWh RRB Charges to be greater than expected. Legislative action adverse to the Holders might be taken in response, and such legislation, if challenged as a violation of the State Pledge, might be defended on the basis of public necessity. Please read "The Financing Act and the Finance Order" and "Risk Factors—Risks Associated with Potential Judicial, Legislative or Regulatory Actions—Future New Hampshire Legislative Action Might Attempt to Invalidate the RRBs or the RRB Property" in this prospectus.

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Technological change might make alternative energy sources more attractive in the future.

        Technological developments and/or tax or other economic incentives might result in the introduction of economically attractive, more fuel-efficient, more environmentally-friendly and/or more cost-effective alternatives to purchasing electricity through a utility's distribution facilities for increasing numbers of Customers. Manufacturers of self-generation facilities may develop smaller-scale, more fuel-efficient on-site generating and/or storage units that can be cost-effective options for a greater number of Customers. Moreover, an increase in self-service power may result if extreme weather conditions cause shortages of grid-supplied energy or if other factors cause grid-supplied energy to be less reliable. Customers who self-generate their electricity must pay the RRB Charges to the extent that such energy, or emergency back-up power, is transmitted through use of a utility's delivery system. Technological developments might allow greater numbers of Customers to reduce or even altogether avoid RRB Charges under such provisions through on-site generation and storage. This might reduce the kilowatt-hours of electric energy delivered to Customers by means of PSNH's transmission and distribution facilities, thereby causing reduced collections and payment delays on the RRBs. In addition, RRB Charges to the remaining Customers would increase, which could increase the risk of charge-offs.

Risks Associated with Potential Bankruptcy Proceedings

        For a detailed discussion of the following risks, please read "Bankruptcy and Creditors' Rights Issues" in this prospectus. In addition, the risk factors enumerated below in this subsection are based on general legal principles and outcomes; each bankruptcy case is factually unique, and the outcome of any bankruptcy case is based upon the application of legal principles to the specific facts of that bankruptcy case.

Bankruptcy of PSNH or any successor or assignee could result in losses or delays in payments on the RRBs.

        The Financing Act provides that as a matter of New Hampshire law:

•

RRB Property may be sold to one or more special purpose financing entities, that is authorized by a finance order to issue rate reduction bonds, acquire the RRB Property, or both on behalf of an electric utility.



•

The sale or transfer of the RRB Property shall be treated as a "true sale" or absolute transfer, if the parties to the transfer expressly so state in the governing documentation, in a transaction approved by a finance order and made in connection with the issuance of the RRBs.



•

The characterization of the transfer of the RRB Property as a "true sale" will not be impaired or negated notwithstanding any contrary treatment of such transfer for accounting, tax or other purposes.



•

The RRB Charges constitute RRB Property within the meaning of the Financing Act and will represent a current and irrevocable vested property right including, without limitation, the right, title and interest of PSNH or the Issuer in and to all revenues, collections, claims, payments, money or proceeds of or arising from the RRB Charges authorized pursuant to the Finance Order to recover the RRB Costs and all rights to obtain adjustments to the RRB Charges pursuant to the terms of the Finance Order, and shall constitute a current and irrevocable vested property right, notwithstanding the fact that the value of such property right may depend upon electricity usage or the performance of certain services.

        These principles are important to maintaining payments on the RRBs in accordance with their terms during any bankruptcy of PSNH. In addition, the transaction has been structured with the objective of keeping the Issuer separate from PSNH in the event of a bankruptcy of PSNH.

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        The Financing Act further provides that the interest of an assignee or pledgee in RRB Property specified in the Finance Order, and in the revenue and collections arising from that property, is not subject to setoff, counterclaim, surcharge, or defense by the electric utility or any other person or in connection with the reorganization, bankruptcy, or other insolvency of the electric utility or any other entity.

        A bankruptcy court generally follows state property law on issues such as those addressed by the four principles described above. However, a bankruptcy court has authority not to follow state law if it determines that the state law is contrary to a paramount federal bankruptcy policy or interest. If a bankruptcy court in a bankruptcy of PSNH refused to enforce one or more of the state property law provisions described above for this reason, the effect of this decision on you as a Holder could be similar to the treatment you would receive in a bankruptcy of PSNH if the RRBs had been issued directly by PSNH, including without limitation possibly causing material delays in payment of, or losses on, your RRBs and possibly materially reducing the value of your investment in the RRBs. Specific examples of possible effects are set forth below. A decision by the bankruptcy court that, despite the separateness of the Issuer from PSNH, the assets and liabilities of the Issuer and those of PSNH should be substantively consolidated would have a similar effect on you as a Holder.

        The Issuer has taken steps together with PSNH, as the Seller, to reduce the risk that in the event PSNH or an affiliate of PSNH were to become the debtor in a bankruptcy case, a court would order that the assets and liabilities of the Issuer would be substantively consolidated with those of PSNH or an affiliate. Such steps include, without limitation, provisions in the LLC Agreement of the Issuer concerning entity separation and requiring an independent manager. Nonetheless, these steps might not be effective, and thus if PSNH or an affiliate of PSNH were to become a debtor in a bankruptcy case, a court may order that the assets and liabilities of the Issuer be consolidated with those of PSNH or the affiliate.

        Additionally, a bankruptcy filing by PSNH could trigger a bankruptcy filing by the Issuer with similar negative consequences for Holders. In a recent bankruptcy case, In re General Growth Properties, Inc. , General Growth Properties, Inc., or GGP , filed for bankruptcy together with many of its direct and indirect subsidiaries, including many subsidiaries that were organized as special purpose financing entities. The Southern District of New York bankruptcy court upheld the validity of the filings of these special purpose subsidiaries. Additionally, as part of the original cash collateral motion, the debtors sought approval of a debtor in possession loan to GGP and to GGP Limited Partnership that would be guaranteed by the special purpose entities and secured with second liens on substantially all their assets. As upstream guarantors, the special purpose entities would have received no direct benefit from the loan because the proceeds would have been disbursed to their parent entities. The debtor in possession loan that was ultimately approved by the bankruptcy court did not contain this guarantee or involve a pledge of assets of the special purpose entities. In a subsequent order, the court, while refusing to dismiss the chapter 11 petitions of certain special purpose entities, stated: "The salient point for purposes of these Motions is that the fundamental protections that the Movants negotiated and that the SPE structure represents are still in place and will remain in place during the Chapter 11 cases. This includes protection against the substantive consolidation of the project-level debtors with any other entities." The General Growth case nevertheless serves as a reminder that bankruptcy courts may subordinate legal rights of creditors in the interests of helping debtors reorganize.

        Regardless of whether a bankruptcy court makes any adverse determination with respect to substantive consolidation of the assets and liabilities of the Issuer with PSNH or an affiliate of PSNH, a bankruptcy filing by PSNH or an affiliate of PSNH might cause material delays in payment of, or losses on, your RRBs and might materially reduce the value of your investment in the RRBs.

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        Specific effects of bankruptcy filing by PSNH or an affiliate of PSNH could include:

•

without permission from the bankruptcy court, the Indenture Trustee might be prevented from taking actions against PSNH or recovering or using funds on your behalf or replacing PSNH as the Servicer;



•

the bankruptcy court might order the Indenture Trustee to exchange the RRB Property for other property, which might be more illiquid or of lower value;



•

tax or other government liens on PSNH's property that arose after the transfer of the RRB Property to the Issuer might nevertheless have priority over the Indenture Trustee's lien and might be paid from RRB Charge Collections before payments on your RRBs;



•

the Indenture Trustee's lien might not be properly perfected in RRB Charge Collections that were commingled with other funds of PSNH collected from Customers as of the date of PSNH's bankruptcy, or might not be properly perfected in all of the RRB Property, including, without limitation, if all perfection requirements are not met, and the lien might therefore be set aside in the bankruptcy, with the result that your RRBs would represent only general unsecured claims against PSNH;



•

the bankruptcy court might rule that neither the Issuer's property interest nor the Indenture Trustee's lien extends to RRB Charges in respect of electricity consumed after the commencement of PSNH's bankruptcy case, with the result that your RRBs would represent only general unsecured claims against PSNH;



•

The Issuer and PSNH might be relieved of the obligation to make any payments on your RRBs during the pendency of the bankruptcy case and might be relieved of any obligation to pay interest accruing after the commencement of the case;



•

PSNH might lower the interest rate, extend the maturity date or otherwise alter the terms of your RRBs as part of its plan of reorganization;



•

the bankruptcy court might rule that the RRB Charges should be used to pay a portion of the cost of providing electric service;



•

the bankruptcy court might rule that the remedy provisions of the Sale Agreement are unenforceable, leaving the Issuer with an unsecured claim of actual damages against PSNH which might be expensive and difficult to prove or enforce;



•

the sale of the RRB Property might be construed as a financing and not a sale which might delay or limit payment on your RRBs and potentially deprive you of collateral securing the RRBs;



•

claims against PSNH or any successor or assignee might be limited in the event of a bankruptcy of the Seller;



•

a bankruptcy of PSNH or any successor or assignee could limit the remedies available to the Indenture Trustee;



•

if the Servicer defaults or enters bankruptcy Proceedings, it might be difficult to find a successor Servicer and payments on your RRBs might be temporarily suspended; or



•

if the Servicer enters bankruptcy Proceedings, the collections of the RRB Charges paid by the Servicer during a period of up to one year prior to the commencement of the bankruptcy case might constitute voidable preferences.

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Other Risks Associated with the Purchase of the RRBs

PSNH's obligation to indemnify the Issuer for a breach of a representation or warranty might not be sufficient to protect your investment.

        PSNH will be obligated under the Sale Agreement to indemnify the Issuer and the Indenture Trustee, for itself and on behalf of the Holders, only in specified circumstances. Similarly, PSNH will be obligated under the Servicing Agreement to indemnify the Issuer and the Indenture Trustee, for itself and on behalf of the Holders only in specified circumstances. Please read "The Sale Agreement" and "The Servicing Agreement" in this prospectus.

        Neither the Indenture Trustee nor the Holders will have the right to accelerate payments on the related RRBs as a result of a breach under the Sale Agreement or Servicing Agreement, absent an Event of Default under the Indenture and the Series Supplement as described in "Description of the RRBs—Events of Default; Rights Upon Event of Default." Furthermore, PSNH might not have sufficient funds available to satisfy its indemnification obligations, and the amount of any indemnification paid by PSNH might not be sufficient for you to recover all of your investment in the RRBs. In addition, if PSNH becomes obligated to indemnify Holders, the ratings on the RRBs might be downgraded as a result of the circumstances causing the breach and the fact that Holders will be unsecured creditors of PSNH with respect to any of these indemnification amounts. PSNH will not indemnify any person for any loss, damages, liability, obligation, claim, action, suit or payment resulting solely from a downgrade in the ratings on the RRBs, or for any consequential damages, including any loss of market value of the RRBs resulting from a default or a downgrade of the ratings of the RRBs. Please read "The Sale Agreement—Seller Representations and Warranties and "—Indemnification" in this prospectus.

PSNH may sell property similar to the RRB Property through another affiliated entity in the future.

        PSNH may in the future without your review or approval sell property similar to the RRB Property to one or more entities other than the Issuer in connection with a new issuance of bonds similar to the RRBs or similarly authorized types of bonds. Any new issuance may include terms and provisions that would be unique to that particular issue.

        In the event a Customer does not pay in full all amounts owed under any bill, including RRB Charges, PSNH, as Servicer, is required to allocate any resulting shortfalls in RRB Charges ratably based on the amounts of RRB Charges owing in respect of the RRBs, and the total amounts owed by that Customer. As a result, the Issuer cannot assure you that the issuance of future rate reduction bonds would not cause reductions or delays in payment of your RRBs.

The Issuer is issuing several Tranches of the RRBs.

        The Finance Order authorizes the Issuer to issue one or more Tranches of rate reduction bonds not to exceed the aggregate principal amount of $690,000,000. RRB Charges collected by or for the benefit of PSNH will be allocated among the Tranches of RRBs as set forth in the Extended Amortization Schedule and the priority of payments set forth under "Description of the RRBs—How Funds in the Collection Account Will Be Allocated." However, the Issuer cannot assure you that the existence of multiple Tranches of RRBs would not cause reductions or delays in payment on your RRBs. In addition, some matters relating to the RRBs may require the vote of the Holders of all Tranches of the RRBs. Your interests in these votes might conflict with the interests of the beneficial owners of RRBs of another Tranche and therefore these votes could result in an outcome that is materially unfavorable to you.

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Absence of a secondary market for the RRBs might limit your ability to resell RRBs.

        The underwriters for the RRBs might assist in resales of such RRBs but they are not required to do so. A secondary market for the RRBs might not develop. If a secondary market does develop, it might not continue or there might not be sufficient liquidity to allow you to resell any of your RRBs. The Issuer does not anticipate that any RRBs will be listed on any securities exchange.

The RRBs' credit ratings might affect the market value of your RRBs.

        A downgrading of the credit ratings of the RRBs might have an adverse effect on the market value of the RRBs. Credit ratings might change at any time and an NRSRO has the authority to revise or withdraw its rating based solely upon its own judgment. In addition, any downgrade in the credit ratings of the RRBs may result in the RRBs becoming ineligible to be held by certain funds or investors, which may require such investors to liquidate their investment in the RRBs and result in lower prices and a less liquid market trading market for the RRBs.

The ratings are no indication of the expected rate of payment of principal on the RRBs and the Issuer might pay principal of the RRBs later than expected.

        The RRBs will be rated by one or more established NRSROs. A rating is not a recommendation to buy, sell or hold the RRBs. The ratings merely analyze the probability that the Issuer will repay the total principal amount of the RRBs at their respective Final Maturity Dates (which are later than the expected Scheduled Final Payment Dates) and will make timely interest payments. The ratings are not an indication that the NRSROs believe that principal payments are likely to be paid on time according to the Expected Amortization Schedule. Thus, the Issuer might repay the principal of your RRBs later than you expect, which might materially reduce the value of your investment.

        Under Rule 17g-5 under the Exchange Act, NRSROs providing the issuer, sponsor or underwriter with the requisite certification will have access to all information posted on a website by the issuer, sponsor or underwriter for the purpose of determining the initial rating and monitoring the rating after the issuance date in respect of the RRBs. As a result, an NRSRO other than the Rating Agencies hired by PSNH may issue ratings on the RRBs, or unsolicited ratings , which may be lower, and could be significantly lower, than the ratings assigned by the Rating Agencies. The unsolicited ratings may be issued prior to, or after, the issuance date in respect of the RRBs. Issuance of any unsolicited rating will not affect the issuance of the RRBs. Issuance of an unsolicited rating lower than the ratings assigned by the Rating Agencies on the RRBs might adversely affect the value of the RRBs and, for regulated entities, could affect the status of the RRBs as a legal investment or the capital treatment of the RRBs. Investors in the RRBs should consult with their legal counsel regarding the effect of the issuance of a rating by an NRSRO other than the Rating Agencies that is lower than the rating of a Rating Agency. None of PSNH, the Issuer, the underwriters or any of their affiliates will have any obligation to inform you of any unsolicited ratings assigned after the date of this prospectus. In addition, if the Issuer or PSNH fail to make available to an NRSRO other than the Rating Agencies any information provided to any Rating Agency for the purpose of assigning or monitoring the ratings on the RRBs, a Rating Agency could withdraw its ratings on the RRBs, which could adversely affect the market value of your RRBs and could limit your ability to resell your RRBs.

Regulatory provisions affecting certain investors could adversely affect the liquidity and the regulatory treatment of investments in the RRBs.

        In Europe, the U.S. and elsewhere there continues to be increased political and regulatory scrutiny of the asset-backed securities industry. This has resulted in a range of regulations which are currently at various stages of implementation and which may have an adverse impact on the regulatory position of certain investors in securitizations and/or the incentives for certain investors to hold asset-backed

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securities, thereby affecting the liquidity of such securities. None of PSNH, the Issuer nor any other party to the transaction of which this offering is a part makes any representation to any prospective investor or purchaser of the RRBs regarding the regulatory treatment of their investment in the RRBs now or at any time in the future. Investors in the RRBs are responsible for analyzing their own regulatory positions and are encouraged to consult their own investment and legal advisors regarding the suitability of the RRBs for investment.

        Among other regulations, investors based in the EU should be aware of the EU risk retention and due diligence requirements which currently apply, or are expected to apply in the future, in respect of various types of EU-regulated investors. Such requirements restrict a relevant investor from (among other things) investing in asset-backed securities unless: (a) that investor is able to demonstrate that it has undertaken certain due diligence in respect of various matters including its securities position, the underlying assets and (in the case of certain types of investors) the relevant sponsor or originator; and (b) the originator, sponsor or original lender in respect of the relevant securitization has explicitly disclosed to the investor that it will retain, on an on-going basis, a net economic interest of not less than 5% in respect of certain specified credit-risk tranches or asset exposures. Failure to comply with one or more of the requirements may result in various penalties, including, in the case of those investors subject to regulatory capital requirements, the imposition of a penal capital charge on the securities acquired by the relevant investor.

        The Issuer and PSNH are of the opinion that the RRBs do not constitute an exposure to a "securitisation position" for the purposes of the EU risk retention and due diligence requirements and that, as such, the EU risk retention and due diligence requirements should not apply to investments in the RRBs. Therefore, neither the Issuer, PSNH nor any other entity has committed to retain a material net economic interest in relation to this transaction.

If the investment of collected RRB Charges and other funds held pursuant to the Indenture and the Series Supplement in the Collection Account results in investment losses or the investments become illiquid, you might receive payment of principal of and interest on the RRBs later than you expect.

        Funds held pursuant to the Indenture and the Series Supplement in the Collection Account will be invested in Eligible Investments. Eligible Investments include money market funds having a rating from Moody's Investors Service, Inc. (or any successor in interest) and S&P Global Ratings (or any successor in interest), of Aaa and AAA, respectively. Although investments in these money market funds have traditionally been viewed as highly liquid with a low probability of principal loss, illiquidity and principal losses have been experienced by investors in certain of these funds as a result of disruptions in the financial markets in recent years. If investment losses or illiquidity are experienced, you might experience a delay in payments of principal and interest and a decrease in the value of your investment in the RRBs.

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REVIEW OF THE RRB PROPERTY

        Pursuant to Regulation AB, PSNH, as Sponsor, has performed a review of the RRB Property underlying the RRBs. As required by Regulation AB, the review was designed and effected to provide reasonable assurance that disclosure regarding the RRB Property is accurate in all material respects. PSNH did not engage a third party in conducting its review but consulted with its legal counsel and structuring agent in conducting its review.

        The RRBs will be secured under the Indenture by the RRB Collateral. The principal asset included within the RRB Collateral is the RRB Property. The RRB Property is a current and irrevocable vested property right of the Issuer under the Finance Order, including, without limitation, all right, title and interest of the Issuer in and to all revenues, collections, claims, payments, money or proceeds of or arising from the RRB Charges authorized pursuant to the Finance Order to recover the RRB Costs and to all rights to obtain adjustments to the RRB Charges pursuant to the terms of the Finance Order. The RRB Charges are non-bypassable and are payable by all Customers taking retail electric service from PSNH or its successors or assignees. RRB Charges are payable by Customers regardless of who they have chosen as their energy supplier and regardless of whether or not they are self-generating, so long as they are connected to PSNH's distribution system for back-up power.

        The RRB Property is not a static pool of assets. The RRB Charges included within the RRB Property are irrevocable and not subject to limitation, alteration, amendment, reduction or impairment or, except for the Periodic Adjustments to correct any overcollections or undercollections, adjustment by further action of the NHPUC. RRB Charges will be adjusted at least annually through an Annual Routine True-Up Letter filed by the Servicer with NHPUC no later than January 15 of each year to ensure that there are adequate funds to meet the Periodic RRB Payment Requirements for the two Remittance Periods beginning, respectively, on January 1 and July 1 of the year that such letter is filed. RRB Charges may be adjusted semi-annually through the filing of a Mid-Year Routine True-Up Letter no later than July 15 of each year if the Servicer reasonably projects that expected collections of the RRB Charges will be insufficient to meet the Periodic RRB Payment Requirements for the Remittance Period beginning on July 1 of such year. In addition, except during the two Remittance Periods preceding the Final Maturity Date of the latest maturing Tranche of RRBs, the Servicer may file an Other Routine True-Up Letter not later than the date that is 15 days before the end of the then-current calendar month if the Servicer reasonably projects that expected collections of the RRB Charges will be insufficient to meet the Periodic RRB Payment Requirements for the then-current Remittance Period. During the two Remittance Periods preceding the Final Maturity Date of the latest maturing Tranche of RRBs, if the Servicer reasonably projects that expected collections of the RRB Charges will be insufficient to meet the Periodic RRB Payment Requirements for the then-current Remittance Period, the Servicer will file an Other Routine True-Up Letter not later than the date that is 15 days before the end of the then-current calendar month. There is no cap on the level of RRB Charges that may be imposed on Customers as a result of the Periodic Adjustments to pay on a timely basis scheduled principal of and interest on the RRBs and other ongoing costs as described under "Description of the RRBs—How Funds in the Collection Account will be Allocated." The RRB Collateral securing payment of the RRBs is described in more detail under "Description of the RRBs—Collateral for the RRBs" in this prospectus.

        In the Finance Order, NHPUC, among other things:

•

established the RRB Charge and authorized PSNH to collect the RRB Charge from all Customers taking retail electric service during the term that the RRBs are outstanding;



•

confirmed that the Holders and the Indenture Trustee will be entitled to rely on and are entitled to the benefit of the State Pledge; and

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•

approved the procedures and methodologies for adjusting the RRB Charges during the term that the RRBs are outstanding to ensure that the expected RRB Charge Collections are sufficient to pay on a timely basis scheduled principal of and interest on the RRBs and other ongoing costs.

        Please read "The Financing Act and the Finance Order" in this prospectus for more detail.

        The characteristics of the RRB Property are unlike the characteristics of assets underlying mortgage and other commercial asset securitizations because the RRB Property is a creature of statute and state regulatory commission proceedings. Because the nature and characteristics of the RRB Property and many elements of the securitization are set forth in and constrained by the Financing Act and the Finance Order, PSNH, as Sponsor, does not select the assets to be securitized in ways common to many securitizations. Moreover, the RRBs do not contain origination or underwriting elements similar to typical mortgage or other loan transactions involved in other forms of asset-backed securities. The Financing Act and the Finance Order require the imposition on, and collection of RRB Charges from, existing and future Customers. Since the RRB Charges are assessed against all such Customers and the Periodic Adjustments adjust for the impact of Customer defaults, the collectability of the RRB Charges is not ultimately dependent upon the credit quality of particular Customers, as would be the case in the absence of the Periodic Adjustments.

        The review by PSNH of the RRB Property underlying the RRBs has involved a number of discrete elements as described in more detail below. PSNH has analyzed and applied the Financing Act's requirements for securitization of qualified costs in seeking approval of the NHPUC for the issuance of the Finance Order and in its proposal with respect to the characteristics of the RRB Property to be created pursuant to the Finance Order. PSNH worked with its counsel and its financial advisor in preparing the petition for a Finance Order and with the NHPUC on the terms of the Finance Order. Moreover, PSNH worked with its counsel, its structuring agent and counsel to the structuring agent and the underwriters in preparing the legal agreements that provide for the terms of the RRBs and the collateral for the RRBs. PSNH has analyzed economic issues and practical issues for the collection of the RRB Charges and the scheduled payment of the RRBs, including the impact of economic factors, potential for disruptions due to weather or catastrophic events and its own forecasts for electricity usage as well as the historic accuracy of its prior forecasts.

        In light of the unique nature of the RRB Property, PSNH has taken (or, prior to the offering of the RRBs, will take) the following actions in connection with its review of the RRB Property and the preparation of the disclosure for inclusion in this prospectus describing the RRB Property, the RRBs and the proposed securitization:

•

reviewed the Financing Act, other relevant provisions of New Hampshire statutes and any applicable NHPUC Regulations as they relate to the RRB Property in connection with the preparation and filing of the application with the NHPUC for the approval of the Finance Order in order to confirm that the application and proposed Finance Order satisfied applicable statutory and regulatory requirements;



•

actively participated in the proceedings before the NHPUC relating to the approval of the Finance Order;



•

compared the process by which the Finance Order was adopted and approved by the NHPUC to the requirements of the Financing Act and any applicable NHPUC Regulations as they relate to the RRB Property to confirm that it met such requirements;



•

compared the proposed terms of the RRBs to the applicable requirements in the Financing Act, other relevant provisions of New Hampshire statutes, the Finance Order and any applicable NHPUC Regulations to confirm that they met such requirements;

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•

prepared and reviewed the agreements to be entered into in connection with the issuance of the RRBs and compared such agreements to the applicable requirements in the Financing Act, other relevant provisions of New Hampshire statutes, the Finance Order and any applicable NHPUC Regulations to confirm that they met such requirements;



•

reviewed the disclosure in this prospectus regarding the Financing Act, other relevant provisions of New Hampshire statutes, the Finance Order and the agreements to be entered into in connection with the issuance of the RRBs, and compared such descriptions to the relevant provisions of the Financing Act, other relevant provisions of New Hampshire statutes, the Finance Order and such agreements to confirm the accuracy of such descriptions;



•

consulted with legal counsel to assess if there is a basis upon which the Holders (or the Indenture Trustee acting on their behalf) could successfully challenge the constitutionality of any legislative action by the State of New Hampshire (including the NHPUC) that could repeal or amend the securitization provisions of the Financing Act that could substantially impair the value of the RRB Property, or substantially reduce, alter or impair the RRB Charges;



•

reviewed the process and procedures in place for it, as Servicer, to perform its obligations under the Servicing Agreement, including billing, collecting and posting the RRB Charges to be provided for under the RRB Property, forecasting RRB Charges, and preparing and filing applications for Periodic Adjustments to the RRB Charges;



•

reviewed the methodology and procedures for the Periodic Adjustments for adjusting RRB Charge levels to meet the scheduled payments on the RRBs and in this context took into account its experience with the NHPUC; and



•

with the assistance of the underwriters, prepared financial models in order to set the initial RRB Charges to be provided for under the RRB Property at a level sufficient to pay on a timely basis scheduled principal of and interest on the RRBs and other ongoing costs.

        In connection with the preparation of such models, PSNH:

•

reviewed (i) the historical electric usage and Customer growth within its service territory and (ii) forecasts of expected electric usage and Customer growth;



•

reviewed its historical collection of RRB Charges with respect to the 2001 and 2002 securitization bonds issued by an affiliate of PSNH and reviewed the resulting payment history and true-up adjustment experience with respect to the 2001 and 2002 bonds; and



•

analyzed the sensitivity of the weighted average life of the RRBs in relation to variances in actual electric usage from forecasted levels and in relation to the Periodic Adjustments in order to assess the probability that the weighted average life of the RRBs may be extended as a result of such variances, and in the context of the Periodic Adjustments for adjustment of RRB Charges to address undercollections or overcollections in light of scheduled payments on the RRBs.

        As a result of this review, PSNH has concluded that:

•

the RRB Property, the Finance Order and the agreements to be entered into in connection with the issuance of the RRBs meet in all material respects the applicable statutory and regulatory requirements;



•

the disclosure in this prospectus regarding the Financing Act, other relevant provisions of New Hampshire statutes, the Finance Order and the agreements to be entered into in connection with the issuance of the RRBs is accurate in all material respects;

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•

the Servicer has adequate processes and procedures in place to perform its obligations under the Servicing Agreement;



•

RRB Charges, as adjusted from time to time as provided in Financing Act and the Finance Order, are expected to generate sufficient revenues to pay on a timely basis scheduled principal of and interest on the RRBs and other ongoing costs; and



•

the design and scope of PSNH's review of the RRB Property as described above is effective to provide reasonable assurance that the disclosure regarding the RRB Property in this prospectus is accurate in all material respects.

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THE FINANCING ACT AND THE FINANCE ORDER

        The Financing Act was enacted into New Hampshire law on June 12, 2000 to provide for the issuance of rate reduction bonds to enable by PSNH to recover certain stranded costs associated with the restructuring of the electric industry in the State of New Hampshire. The Financing Act was subsequently amended on July 9, 2015 to specifically authorize the use of securitization by PSNH to recover certain stranded costs resulting from the divestiture of some or all of PSNH's generation assets.

        The Financing Act authorizes the NHPUC to issue a finance order, which is a regulatory order that approves the recovery of certain costs incurred by PSNH through a securitization. On June 15, 2017, PSNH filed with the NHPUC a petition for a finance order to approve the issuance of RRBs to enable PSNH to recover certain of its stranded costs resulting from the divestiture of its generating assets. An updated and amended version of the petition was filed with the NHPUC on November 13, 2017. On December 6, 2017, the NHPUC held a hearing on PSNH's petition. The petition was supported by the staff of the NHPUC as well as the New Hampshire Office of the Consumer Advocate. No party opposed PSNH's petition or sought to intervene in the matter. On January 30, 2018, the NHPUC issued the Finance Order. Pursuant to New Hampshire law, after the expiration of a 30-day rehearing period in which no motion for rehearing is filed, the Finance Order will become final. If any request for rehearing is made, the NHPUC will have 30 days to approve or reject the request for rehearing, or suspend the Finance Order pending further consideration. If any request for rehearing is made and rejected by the NHPUC, the Finance Order may be appealed to the New Hampshire Supreme Court within 30 days of such rejection. As of the date hereof, no party has sought to appeal the Finance Order. Pursuant to the Financing Act, once final, the Finance Order is irrevocable and is not subject to rescission, alteration or amendment by further action of the NHPUC, except for the Periodic Adjustments to the RRB Charge.

        The Financing Act permits PSNH to recover any RRB Costs through the issuance of the RRBs. The Financing Act defines RRB Costs to include, among other items, expenditures incurred to implement the 2015 Settlement Agreement or other divestitures of some or all of PSNH's generating assets as ordered by the NHPUC. The NHPUC approved the 2015 Settlement Agreement on July 1, 2016 in Docket No. DE 14-238 and subsequently approved the contracts for divestiture of certain of PSNH's generation assets by orders issued on November 28 and 29, 2017 in Docket No. DE 17-124. The Finance Order expressly approved the costs to be securitized through the issuance of the RRBs and found that the entire amount of RRB Costs approved under the Finance Order is eligible to be considered "RRB Costs" within the meaning of RSA 369-B:2, XIV, is reasonable, and is eligible to be funded with the proceeds of the RRBs issued under the authority of the Finance Order.

        The Finance Order authorizes the issuance of the RRBs in one or more series in an aggregate principal amount not to exceed $690,000,000. The Finance Order permits PSNH to determine the final principal amount of RRBs to be issued after the divestiture of the thermal (fossil) generation assets as approved by the NHPUC has been consummated and PSNH has a reasonable basis to calculate its stranded costs, unrecovered deferrals, transaction costs, tax stabilization payments, employee protections and other costs with respect to such divesture. The Finance Order also approves the organization and capitalization of the Issuer, the creation of the RRB Property and the use of proceeds of the RRBs. The Finance Order contains all determinations that are required under the Financing Act, including with respect to the reasonableness of the RRB Charge and the issuance of the Finance Order being consistent with the public interest.

        The Finance Order establishes, among other things, the RRB Charge to recover the stranded costs specified therein. Pursuant to the Financing Act, the RRB Charge is non-bypassable in that Customers must pay the RRB Charge whether or not they receive retail electric service from PSNH or a third party supplier of energy, and whether or not their distribution system is being operated by PSNH or a successor distribution company. The Financing Act provides that the right to collect payments based on

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the RRB Charge is a property right which may be pledged, assigned or sold in connection with the issuance of RRBs. The Finance Order expressly provides that the sale of the RRB Property will be treated as a true sale, and not as a pledge or other financing, pursuant to the Financing Act. In addition, the Finance Order provides that upon the sale of the RRB Property to the Issuer, the Issuer, the Holders and the Indenture Trustee will be entitled to rely on and entitled to the benefit of the State Pledge.

        The RRB Charges are permitted to be adjusted periodically, but not less frequently than annually nor more frequently than monthly, as specified in the Finance Order and are assessed as an amount per kilowatt-hour of electricity usage by a Customer. See "Description of the Servicing Agreement—Periodic Adjustment Process." In addition to the Periodic Adjustments, the Finance Order permits the Issuer to bill and collect RRB Charges for an additional two (2) years beyond the Scheduled Final Payment Date for the latest maturing Tranche of RRBs (or, if earlier, through the date on which the RRB Costs have been fully paid).

        The Finance Order provides that PSNH shall file, for informational purposes, an Issuance Advice Letter relating to the issuance of the RRBs to the NHPUC. The Issuance Advice Letter will establish the final structure and repayment terms of the RRBs, the identity of the Issuer, the total principal amount and pricing of the RRBs, the initial RRB Charges by Customer class to be implemented upon issuance of the RRBs, the capital contribution amount and the actual upfront transaction costs. The filing of the Issuance Advice Letter is not a condition to the effectiveness of the Finance Order or the issuance of the RRBs. In addition, within 90 days following the RRB issuance, and within 60 days of the end of each fiscal quarter thereafter until the proceeds have been applied in full, PSNH shall file with the NHPUC a report showing the use of RRB proceeds in compliance with the Finance Order.

        The Financing Act and the Finance Order provide that the RRBs will not constitute a debt or liability of the State of New Hampshire or of any political subdivision thereof, and will not constitute a pledge of the full faith and credit of the State or any of its political subdivisions. The Finance Order provides that the issuance of the RRBs does not directly, indirectly, or contingently obligate the State of New Hampshire or any political subdivision thereof to make any appropriation for their payment.

        In the Financing Act, the State of New Hampshire has pledged, contracted and agreed with the Issuer, as owner of the RRB Property, and the Holders and the Indenture Trustee that neither the state nor any of its agencies, including the NHPUC, will limit, alter, amend, reduce, or impair the RRB Charges, RRB Property, Finance Order, and all rights thereunder or ownership thereof or security interest therein until the RRBs, including all principal, interest, premium, costs and arrearages thereon, are fully met and discharged, unless adequate provision is made by law for the protection of the Issuer, Holders and the Indenture Trustee. In the Finance Order, the NHPUC approved that the Issuer, Holders and the Indenture Trustee will be entitled to rely on and will be entitled to the benefit of the pledge, contract and agreement set forth above.

Constitutional Matters

        Ropes & Gray LLP expects to deliver an opinion, in connection with the closing of the offering of the Rate Reduction Bonds, as to whether, with respect to United States federal law, a reviewing court of competent jurisdiction, in a properly prepared and presented case, would conclude that: (i) the pledge contained in Section 369-B:6 of the Financing Act constitutes a contractual relationship between the Holders and the State of New Hampshire for purposes of Article I, Section 10 of the United States Constitution; (ii) absent a demonstration by the State of New Hampshire that a substantial impairment of that contract is reasonable and necessary to further a significant and legitimate public purpose, the Holders (or the Indenture Trustee acting on their behalf) could successfully challenge under the federal Contract Clause the constitutionality of any law subsequently enacted, whether by legislation or by voter initiative, determined by such court to limit, alter, amend, reduce or impair the RRB Charge, the

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RRB Property, the Finance Order, and all rights thereunder or ownership thereof or security interest therein so as to cause a substantial impairment prior to the time that the Rate Reduction Bonds are fully paid and discharged, unless adequate provision shall be made by law for the protection of the Issuer, the Holders and the Indenture Trustee; (iii) although sound and substantial arguments might support the granting of preliminary and permanent injunctive relief to prevent implementation of any law determined to alter, impair or reduce the value of the RRB Property in violation of the federal Contract Clause, the decision to do so will be in the discretion of the court requested to take such action, which will be exercised on the basis of the considerations discussed in the opinion; and (iv) the State of New Hampshire would be required to pay just compensation to Holders if the State of New Hampshire, including its agencies, acted in contravention of the pledge contained in Section 369-B:6 of the Financing Act, after the Rate Reduction Bonds are issued, but before they are fully paid, that materially affected a substantial property interest of Holders in the Rate Reduction Bonds or the RRB Property and the action (a) constituted a permanent appropriation of such substantial property interest or denied all economically beneficial or productive use of the RRB Property; (b) destroyed the RRB Property, other than in response to so-called emergency conditions; or (c) substantially altered, impaired, or reduced the value of the RRB Property in a manner that inflicts a severe economic impact on such Holders and unduly interferes with their reasonable expectations, unless adequate provision shall be made by law for the protection of the Holders. We will file a copy of the opinion as an exhibit to an amendment to the registration statement of which this prospectus is a part or to one of our periodic filings with the SEC.

        For a discussion of risks associated with potential judicial, legislation or regulatory actions, please read "Risk Factors—Risks Associated with Potential Judicial, Legislative or Regulatory Actions."

        McLane Middleton, Professional Association expects to deliver an opinion, in connection with closing of the offering of the Rate Reduction Bonds, as whether, with respect to New Hampshire law, a reviewing court of competent jurisdiction, in a properly prepared and presented case, would conclude that: (i) the pledge contained in Section 369-B:6 of the Financing Act constitutes a contractual relationship between the Holders and the State of New Hampshire for purposes of Part 1, Article 23 of the New Hampshire Constitution, or the N.H. Contracts Clause ; (ii) absent a demonstration by the State of New Hampshire that a substantial impairment of that contract is reasonable and necessary to further a significant and legitimate public purpose, the Holders (or the Indenture Trustee acting on their behalf) could successfully challenge under the N.H. Contracts Clause the constitutionality of any law subsequently enacted, determined by such court to limit, alter, impair, amend, or reduce the value of the RRB Property, the RRB Charge, the Finance Order, and all rights thereunder or ownership thereof or security interest therein so as to cause a substantial impairment prior to the time that the Rate Reduction Bonds are fully paid and discharged, unless adequate provision shall be made by law for the protection of the Issuer, the Holders and the Indenture Trustee; (iii) although sound and substantial arguments might support the granting of preliminary and permanent injunctive relief to prevent implementation of any law determined to alter, impair or reduce the value of the RRB Property in violation of the N.H. Contracts Clause, the decision to do so will be in the discretion of the court requested to take such action, which will be exercised on the basis of the consideration discussed in the opinion; and (iv) the State of New Hampshire would be required to pay just compensation to Holders if, after the Rate Reduction Bonds are issued, but before they are fully paid, the State of New Hampshire, including its agencies, acted arbitrarily or unreasonably and in contravention of the pledge contained in Section 369-B:6 of the Financing Act that materially affected a substantial vested property interest of Holders in the Rate Reduction Bonds or the RRB Property and the action (a) constituted a permanent appropriation of such substantial property interest or denied all economically beneficial or productive use of the RRB Property; (b) destroyed the RRB Property, other than in response to so-called emergency conditions; or (c) substantially limited, altered, amended, impaired, or reduced the value of the RRB Property in a manner that inflicts a severe economic impact on such Holders and unduly interferes with their reasonable expectations, unless adequate provision shall be made by law for

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the protection of the Holders. We will file a copy of the opinion as an exhibit to an amendment to the registration statement of which this prospectus is a part or to be one of our periodic filings with the SEC.

        For a discussion of risks associated with potential judicial, legislation or regulatory actions, please read "Risk Factors—Risks Associated with Potential Judicial, Legislative or Regulatory Actions."

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DESCRIPTION OF THE ISSUER

General

        The Issuer is a limited liability company organized under the laws of the State of Delaware and will be governed by the LLC Agreement to be entered into upon issuance of the RRBs. PSNH is the Issuer's sole member. The Issuer was formed on January 18, 2018. The Issuer's fiscal year ends on December 31 of each year.

        The Issuer has been organized to serve as a special purpose subsidiary of PSNH, for the limited purpose of acquiring and holding the RRB Property and certain Other Collateral and to issue and sell the RRBs. At the time of the issuance of the RRBs, the Issuer's assets will consist of the RRB Property and the Other Collateral , which includes (i) the rights of the Issuer held under the Basic Documents (ii) the Collection Account and (iii) any Investment Earnings on amounts held by the Issuer, with the exception of Capital Subaccount Investment Earnings. See "Description of the RRBs—Collateral for the RRBs" in this prospectus.

        As of the date of this prospectus, the Issuer has not carried on any business activities and has no operating history. The LLC Agreement has been filed as an exhibit to the registration statement of which this prospectus forms a part.

        On or before the date of issuance of the RRBs, PSNH will make a capital contribution to the Issuer in an amount equal to 0.5% of the initial principal amount of the RRBs which will be held in the Capital Subaccount. When the RRBs have been fully paid, any balance in the Capital Subaccount (including Capital Subaccount Investment Earnings not previously remitted to PSNH) shall belong and be returned to PSNH in its capacity as equityholder of the Issuer (and for the avoidance of doubt will not be credited to PSNH's Customers). In addition, Capital Subaccount Investment Earnings will be remitted to PSNH on a monthly basis.

        The Issuer will enter into a Servicing Agreement under which PSNH, on the Issuer's behalf, will manage, service and administer, and make collections in respect of, the RRB Property. See "The Servicing Agreement" in this prospectus.

        The Issuer's principal place of business is C/O Public Service Company of New Hampshire, Energy Park, 780 North Commercial Street, Manchester, New Hampshire 03101-1134.

Managers and Officers

        Pursuant to the LLC Agreement, the Issuer's business will be managed by a management committee consisting of three or more Managers. The LLC Agreement will require that the Issuer have at least one Independent Manager. The Independent Manager must be a natural person who is familiar with and has experience in asset securitization and meets certain customary independence criteria.

        Consent of the Independent Manager will be required to:

•

amend provisions of fundamental organizational documents which ensure the bankruptcy-remoteness of the Issuer;



•

institute or to consent to the institution of bankruptcy or insolvency Proceedings against the Issuer; and



•

dissolve, liquidate or wind up the Issuer.

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        The following is an expected list of the Issuer's Managers and Officers upon the issuance of the RRBs:

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        No compensation has been paid by the Issuer to any Manager or Officer since the Issuer was formed. The Issuer's Managers and Officers, other than any Independent Manager, are officers, directors or Managers of PSNH or its other affiliates and have not been and will not be separately compensated by the Issuer for their services on the Issuer's behalf. The Issuer will pay the Independent Manager annual fees from its revenues and will reimburse such Independent Manager for reasonable expenses in connection with the RRBs. The LLC Agreement will further provide that, to the fullest extent permitted by law, the Issuer will indemnify the Managers and Officers against any liability incurred in connection with their services as Managers and Officers for the Issuer. The Issuer will pay any indemnification amounts owed to Managers and Officers out of funds in the Collection Account, subject to the priority of payments described in "Description of the RRBs—How Funds in the Collection Account Will Be Allocated" in this prospectus.

Restricted Purposes

        The Issuer has been created for the following limited purposes:

•

to acquire, own, hold, administer, service, and enter into the Basic Documents to which it shall be a party and any other agreements regarding the receipt and servicing of the RRB Property, along with certain other related assets;



•

to enter into, perform and comply with the Sale Agreement, assignment agreements or other agreements providing for the purchase of the RRB Property and related assets by the Issuer; and to enter into, perform and comply with such servicing agreements, administration agreements, collection account agreements and other similar agreements as may be necessary or desirable in connection with such sale agreements;



•

to issue, sell, authorize and deliver the RRBs and to enter into any agreement or document providing for the authorization, issuance, sale and delivery of the RRBs;



•

to manage, collect amounts due on, sell, exchange, assign, pledge, encumber or otherwise deal with all or any part of the RRB Collateral, and, in connection therewith, to accept, collect, hold, sell, exchange or otherwise dispose of evidences of indebtedness or other property received pursuant thereto, including the encumbrance of all of the RRB Collateral as collateral security for the RRBs;



•

to invest proceeds from the RRB Property and its other assets and any capital and income of the Issuer in accordance with the Basic Documents or as otherwise determined by the management committee of the Issuer and not inconsistent with the LLC Agreement or the Basic Documents;



•

to execute any registration statement, offering document or related agreements or disclosures related to the issuance of rate reduction bonds or other instruments secured by the RRB Property; and



•

to engage in any lawful act or activity and to exercise any powers permitted to limited liability companies formed under the laws of the State of Delaware that, in either case, are incidental to and necessary, suitable or convenient for the accomplishment of the above-mentioned purposes.

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        The LLC Agreement of the Issuer will provide that it shall not engage in any activity other than in connection with the foregoing or other than as required or authorized by the terms of the Sale Agreement, any Basic Document or any other agreement referenced above.

The Issuer's Relationship with PSNH

        On the issuance date, PSNH will sell RRB Property to the Issuer pursuant to the Sale Agreement between the Issuer and PSNH. PSNH will service such RRB Property pursuant to a Servicing Agreement between the Issuer and PSNH related to the RRBs. Please read "The Sale Agreement" and "The Servicing Agreement" in this prospectus. PSNH will provide certain administrative services to the Issuer pursuant to an administration agreement.

        The RRBs will be included on the consolidated balance sheet of its parent, PSNH, as required by Generally Accepted Accounting Principles and the SEC Office of Chief Accountant governing corporate financial reporting for investor-owned utilities. The Issuer's RRBs will be treated as debt of PSNH for U.S. federal income tax purposes. See "Material U.S. Federal Income Tax Considerations" in this prospectus. For federal income tax purposes, PSNH will not recognize gross income unless and until PSNH bills Customers for the RRB Charges and only in connection with such billing of Customers for such RRB Charges.

The Issuer is Responsible to the NHPUC

        The Issuer is responsible to the NHPUC to the extent provided in the Basic Documents, the Finance Order and the Financing Act. Specifically, the NHPUC has approved the initial issuance of the RRBs pursuant to the Finance Order and the Servicer will file periodic Advice Letters with the NHPUC to adjust the RRB Charge in order to make scheduled payments of principal and interest on the RRBs.

Continuing Disclosure: SEC Filings

        The Issuer plans to file with the SEC required periodic and current reports related to the RRBs consistent with the disclosure and reporting regime established in Regulation AB and will also post those periodic and current reports at a website associated with the Issuer or its affiliates.

The Issuer is a Separate and Distinct Legal Entity

        The transaction of which this offering is a part is structured so that, in the event of a bankruptcy of PSNH, the Issuer's separate legal existence will be respected and the assets and liabilities of the Issuer will remain separate from the estate of PSNH. The structural elements supporting such separate existence include, without limitation, requirements that the Issuer be adequately capitalized, that PSNH be adequately compensated on an arm's-length basis for the servicing functions it performs in billing, collecting, and remitting the RRB Charges, and that PSNH and the Issuer take certain steps to ensure that creditors are not misled as to their separate existence.

        Under the LLC Agreement, the Issuer may not file a voluntary petition for relief under the Bankruptcy Code without a unanimous vote of its Managers, including the Independent Manager. The Issuer's LLC Agreement will require the Issuer to maintain its existence separate from PSNH including:

•

maintaining an arm's length relationship with PSNH and its affiliates; and



•

holding itself out to the public and all other persons as a legal entity separate from PSNH at all times and to correct any known misunderstandings regarding its separate identity.

        The separateness provisions in the LLC Agreement may not be amended by the Issuer without the affirmative vote of the Independent Manager.

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The Administration Agreement

        PSNH will provide the Issuer with administrative services and office space according to the terms of an administration agreement. Such administrative services will include the preparation and delivery of reports and certificates under the Basic Documents, the maintenance of the Issuer's existence and good standing and other ministerial functions under the Basic Documents. The Administration Agreement requires the Issuer to pay PSNH the annual Administration Fee of $75,000, payable semi-annually, for as long as PSNH provides these services.

Investment Company Act of 1940 and Volcker Rule Matters

        The Issuer will be relying on an exclusion or exemption from the definition of "investment company" under the Investment Company Act of 1940, as amended, or the 1940 Act , contained in Section 3(c)(5) of the 1940 Act, although there may be additional exclusions or exemptions available to the Issuer. As a result of such exclusion, the Issuer will not be subject to regulation as an "investment company" under the 1940 Act.

        In addition, the Issuer is being structured so as not to constitute a "covered fund" for purposes of the Volcker Rule, or the Volker Rule , under the Dodd-Frank Wall Street Reform and Consumer Protection Act, or the Dodd-Frank Act . As part of the Dodd-Frank Act, federal law prohibits a "banking entity"—which is broadly defined to include banks, bank holding companies and affiliates thereof—from engaging in proprietary trading or holding ownership interests in certain private funds. The definition of "covered fund" in the regulations adopted to implement the Volcker Rule includes (generally) any entity that would be an investment company under the 1940 Act but for the exemption provided under Sections 3(c)(1) or 3(c)(7) thereunder. Because the Issuer will rely on Section 3(c)(5) of the 1940 Act, it will not be considered a "covered fund" within the meaning of the Volcker Rule regulations.

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PUBLIC SERVICE COMPANY OF NEW HAMPSHIRE—THE DEPOSITOR, SPONSOR, SELLER AND SERVICER

        PSNH will be the Seller and initial Servicer of the RRBs and will be the Depositor and Sponsor of the transaction in which RRBs covered by this prospectus are issued. Public Service Company of New Hampshire, a New Hampshire corporation, is a regulated electric utility that serves residential, commercial and industrial Customers in parts of New Hampshire.

        PSNH was incorporated under New Hampshire law in 1926. On January 28, 1988, PSNH filed a voluntary petition for reorganization under the Bankruptcy Code. In April 1990, the United States Bankruptcy Court confirmed a two-step plan of reorganization pursuant to which Northeast Utilities would acquire PSNH. Pursuant to this plan, on May 16, 1991, PSNH emerged from bankruptcy, and on June 5, 1992, PSNH became a wholly owned subsidiary of Northeast Utilities. On February 2, 2015, Northeast Utilities changed its name to Eversource Energy. Eversource Energy is a public utility holding company, whose shares are listed on the New York Stock Exchange.

        PSNH does business as Eversource Energy in its service territory. As of December 31, 2016, PSNH furnished retail franchise electric service to approximately 511,000 Customers in 211 cities and towns in New Hampshire, covering an area of approximately 5,630 square miles. During the nine months ended September 30, 2017, PSNH billed approximately 5.9 billion kilowatt hours of electricity to its Customers in New Hampshire, resulting in retail electric revenues of approximately $691 million.

        PSNH is subject to regulation by the NHPUC, which, among other things, has jurisdiction over rates, certain dispositions of property and plant, mergers and consolidations, issuances of securities, standards of service and construction and operation of facilities. PSNH is subject to the jurisdiction of FERC, under the Federal Power Act, with respect to license renewals, the transmission of electric energy, accounting, issuance of certain securities and certain other matters.

        Following the sale of the RRB Property to the Issuer, PSNH will have no ownership or other interest in the RRB Property transferred to the Issuer and will have no right to receive any RRB Charges (other than collected as Servicer on the Issuer's behalf). Neither PSNH nor any of its affiliates will purchase any RRBs.

Revenues, Customer Base and Energy Consumption

        The table below sets forth PSNH's electric franchise total retail electric revenues based on categories of Customers in New Hampshire for the years 2013 to 2016:

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        The table below sets forth PSNH's Customers by class for the years 2013 to 2016:

        The table below sets forth PSNH's billed retail delivery sales volume to Customers in New Hampshire for the years 2013 to 2016:

Estimated Consumption and Estimate Variance

        PSNH's calculation of the initial RRB Charges for the Issuer and subsequent adjustments are based on electricity sales estimates. PSNH will use these estimates to calculate and set the RRB Charges at a level intended to generate revenues sufficient to pay interest on and scheduled principal of the RRBs of the Issuer, to pay fees and expenses of servicing and retiring such RRBs and to fund and replenish any deficiencies in the Issuer's Capital Subaccount.

        PSNH conducts sales estimate variance analyses on a regular basis to monitor the accuracy of delivery estimates against recorded consumption. The tables below present the estimates of PSNH's billed retail delivery sales in gigawatt-hours, or GWh , for the years 2013 through 2016. There are 1,000,000 kilowatt-hours in one gigawatt-hour. Each estimate was made in the prior year. For example, the 2013 estimate for residential service of 3,140 gigawatt-hours for PSNH was prepared in 2012.

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